Mexco Energy Corporation Reports Profitable Fiscal 2012

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Mexco Energy Corporation

Jul 03, 2012, 11:09 ET

MIDLAND, Texas, July 3, 2012 /PRNewswire/ -- Mexco Energy Corporation (AMEX: MXC) reported results on its Annual Report on Form 10-K to the Securities and Exchange Commission for the fiscal year ended March 31, 2012.

The Company reported net income of $329,993, or $.16 per diluted share, for fiscal year 2012, an increase of 112%, as compared to $155,696, or $.08 per diluted share, for fiscal 2011.  

Operating revenues in fiscal 2012 were $3,240,039, an increase of 2% when compared to 2011 operating revenues of $3,161,858.  This is the result of a 14% increase in oil production and a 19% increase in oil price partially offset by a 14% decrease in natural gas production and a 10% decrease in natural gas price.  The average sales price received was $6.29 per Mcfe compared to $5.60 per Mcfe received in fiscal 2011.  Revenues from oil and gas royalty interests accounted for approximately 36% of the Company's revenues for fiscal 2012. 

The Company's estimated present value of proved reserves at March 31, 2012 was approximately $25.0 million based on estimated future net revenues discounted at 10% per annum, pricing and other assumptions set forth in "Item 2 – Properties" of the Company's Form 10-K, an increase of 10% as compared to the same at March 31, 2011.  The Company's total estimated proved reserves at March 31, 2012 were 8.445 billion cubic feet of natural gas, a decrease of 4% over the prior fiscal year, and 346,000 barrels of oil and natural gas liquids, an increase of 19% over the prior fiscal year.  For fiscal 2012, natural gas constituted approximately 80% of the Company's total proved reserves and approximately 44% of the Company's revenues. 

Nicholas C. Taylor, Chairman and Chief Executive Officer, stated, "Fiscal 2012 was a productive year for drilling including 54 gross wells (1.55 net wells).  Expenditures for fiscal 2012 amounted to approximately $1,800,000 funded primarily out of cash flow.  Also, in both drilling and acquisitions, Mexco shifted emphasis from natural gas to oil."  The Company's debt is currently at $1,475,000, 11% of equity.       

The Company owns oil and gas properties in twelve states, with the majority of its activity centered in West Texas.  The Company continues to focus its efforts to increase oil and natural gas reserves, through acquisitions, exploration and development.

In accordance with the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995, Mexco Energy Corporation cautions that statements in this press release which are forward-looking and which provide other than historical information involve risks and uncertainties that may impact the Company's actual results of operations.  These risks include, but are not limited to, production variance from expectations, volatility of oil and gas prices, the need to develop and replace reserves, exploration risks, uncertainties about estimates of reserves, competition, government regulation, and mechanical and other inherit risks associated with oil and gas production.  A discussion of these and other factors, including risks and uncertainties, is set forth in the Company's Form 10-K for the fiscal year ended March 31, 2012.  Mexco Energy Corporation disclaims any intention or obligation to revise any forward-looking statements

Mexco Energy Corporation and Subsidiaries

CONSOLIDATED STATEMENTS OF OPERATIONS

Year ended March 31,











2012

2011

2010

Operating revenues:





Oil and gas

$       3,223,659

$       3,145,247

$       3,220,763

Other

16,380

16,611

24,993


Total operating revenues

3,240,039

3,161,858

3,245,756








Operating expenses:





Production

926,215

1,025,932

1,054,224

Accretion of asset retirement obligation

36,251

34,129

31,625

Depreciation, depletion and amortization

996,205

1,047,906

1,113,141

General and administrative

950,690

877,790

870,558


Total operating expenses

2,909,361

2,985,757

3,069,548








Operating profit

330,678

176,101

176,208








Other income (expenses):





Interest income

195

360

478

Interest expense

(28,840)

(36,361)

(33,082)









Net other expense

(28,645)

(36,001)

(32,604)








Earnings before provision for income taxes

302,033

140,100

143,604








Income tax expense (benefit):





Current

-

(25,502)

25,502

Deferred

(27,960)

9,906

(282,737)



(27,960)

(15,596)

(257,235)








Net income

$          329,993

$          155,696

$          400,839
















Earnings per common share:





Basic:

$                0.16

$                0.08

$                0.21

Diluted:

$                0.16

$                0.08

$                0.21








Weighted average common shares outstanding:





Basic:

2,028,014

1,947,605

1,888,070

Diluted:

2,036,241

1,962,656

1,929,588

Mexco Energy Corporation and Subsidiaries

CONSOLIDATED BALANCE SHEETS













March 31,

March 31,





2012

2011

ASSETS





Current assets




Cash and cash equivalents

$      498,681

$      179,071


Accounts receivable:





Oil and gas sales

333,191

384,215



Trade

30,404

42,432


Prepaid costs and expenses

16,782

64,479




Total current assets

879,058

670,197

















Property and equipment, at cost




Oil and gas properties, using the full cost method

31,840,059

30,426,817


Other

78,520

78,520





31,918,579

30,505,337










Less accumulated depreciation, depletion and amortization

16,223,267

15,227,063




Property and equipment, net

15,695,312

15,278,274





$ 16,574,370

$ 15,948,471








LIABILITIES AND STOCKHOLDERS' EQUITY











Current liabilities




Accounts payable and accrued expenses

$      402,098

$      199,944









Long-term debt

1,700,000

1,800,000

Asset retirement obligations

613,279

528,911

Deferred income tax liabilities

884,703

912,663









Commitments and contingencies











Stockholders' equity




Preferred stock - $1.00 par value;





10,000,000 shares authorized; none outstanding

-

-


Common stock - $0.50 par value; 40,000,000 shares authorized;





2,099,116 and 2,089,116 shares issued;

2,035,949 and 2,029,949 shares outstanding as of







 March 31, 2012 and 2011, respectively

1,049,558

1,044,558


Additional paid-in capital

6,608,350

6,453,226


Retained earnings

5,641,827

5,311,834


Treasury stock, at cost (63,167 and 59,167 shares, respectively)

(325,445)

(302,665)

Total stockholders' equity

12,974,290

12,506,953





$ 16,574,370

$ 15,948,471

SOURCE Mexco Energy Corporation