MIDLAND, Texas, Feb. 12 /PRNewswire-FirstCall/ -- Mexco Energy Corporation (Amex: MXC) today reported net income of $131,501, or $0.07 per diluted share, for the quarter ending December 31, 2008, the Company's third quarter of fiscal 2009, compared to $221,114 for the same quarter of fiscal 2008. Operating revenues in the third quarter of fiscal 2009 decreased $27,436 or 3% to $927,644 from $955,080 for the third quarter of fiscal 2008.
The average sales price for the third quarter of fiscal 2009 was $5.19 per Mcfe compared to $8.23 per Mcfe for the third quarter of fiscal 2008, a decrease of 37%. Gas production increased 69% and oil production decreased 7% during the third quarter of fiscal 2009 as compared to the same period of fiscal 2008.
For the nine months ended December 31, 2008, the Company reported a 378% increase in net income to $1,181,405, or $0.61 per diluted share, as compared to $247,164, or $0.14 per diluted share, for the same period of fiscal 2008. Operating revenues increased 59% to $4,208,771 for the nine month period from $2,646,505 for the same period of fiscal 2008, partially the result of revenues generated from the recent purchases of Barnett Shale oil and gas royalty interests.
For the three and nine month periods ending December 31, 2008, revenues from oil and gas royalty interests accounted for approximately 47% and 36%, respectively, of the Company's revenues, compared to approximately 16% and 18% for the same three and nine month periods ending December 31, 2007.
These nine-month period results do not reflect any income from Mexco's Steelhead #1 well in Loving County. The Company has acquired rights-of-way, built a pipeline, initiated testing and, as of January 2009, commenced sales of natural gas from this well.
Nicholas C. Taylor, President and CEO of Mexco Energy Corporation, said, 'In addition to the recent commencement of sales of natural gas from the Steelhead discovery, we expect our Ward Grande #1 well to begin sales of natural gas in the next few days. Both wells are in the testing phase.'
Thomas Graham, Jr., Chairman of the Board of Directors of the Company added, 'This latest report affirms our belief that fiscal 2009 will be a record year due to increased volumes despite declining prices for oil and gas.'
Mexco Energy Corporation owns oil and gas properties in ten states, with the majority of its activity centered in West Texas. The Company continues to focus its efforts on increasing oil and natural gas reserves, through exploration and development as well as acquisition of royalties with significant development potential.
Mexco Energy Corporation and Subsidiaries
CONSOLIDATED BALANCE SHEETS
December 31, March 31,
2008 2008
---- ----
(Unaudited)
ASSETS
Current assets
Cash and cash equivalents $256,872 $303,617
Accounts receivable:
Oil and gas sales 573,028 758,459
Trade 155,501 102,403
Related Parties - 12,659
Prepaid costs and expenses 41,000 22,062
------ ------
Total current assets 1,026,401 1,199,200
Investment in GazTex, LLC - 20,509
Property and equipment, at cost
Oil and gas properties, using the full
cost method 26,430,616 23,941,483
Other 61,362 61,362
------ ------
26,491,978 24,002,845
Less accumulated depreciation,
depletion and amortization 12,771,232 12,019,895
---------- ----------
Property and equipment, net 13,720,746 11,982,950
---------- ----------
$14,747,147 $13,202,659
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable and accrued expenses $528,842 $571,526
Long-term debt 1,650,000 2,600,000
Asset retirement obligation 418,343 374,789
Deferred income tax liabilities 1,238,450 1,196,280
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; 1,958,866 and 1,841,366
shares issued; 1,874,866 and 1,757,366
shares outstanding as of December 31
and March 31, 2008, respectively 979,433 920,683
Additional paid-in capital 5,592,562 4,381,269
Retained earnings 4,766,134 3,584,729
Treasury stock, at cost (84,000 shares) (426,617) (426,617)
-------- --------
Total stockholders' equity 10,911,512 8,460,064
---------- ---------
$14,747,147 $13,202,659
=========== ===========
Mexco Energy Corporation and Subsidiaries
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended Nine Months Ended
December 31 December 31
2008 2007 2008 2007
---- ---- ---- ----
Operating revenue:
Oil and gas sales $908,253 $952,211 $4,176,050 $2,642,302
Other 19,391 2,869 32,721 4,203
------ ----- ------ -----
Total operating
revenues 927,644 955,080 4,208,771 2,646,505
Operating expenses:
Production 237,736 241,019 930,477 1,041,405
Accretion of asset
retirement
obligation 7,291 6,368 21,495 19,691
Depreciation,
depletion,
and amortization 271,530 174,842 751,337 531,523
General and
administrative 193,102 187,648 674,002 636,191
------- ------- ------- -------
Total operating
expenses 709,659 609,877 2,377,311 2,228,810
------- ------- --------- ---------
Operating profit 217,985 345,203 1,831,460 417,695
Other income (expense):
Interest income 110 1,170 1,117 3,255
Interest expense (17,226) (22,791) (70,815) (58,484)
------- ------- ------- -------
Net other expense (17,116) (21,621) (69,698) (55,229)
------- ------- ------- -------
Earnings before
income taxes 200,869 323,582 1,761,762 362,466
Income tax expense:
Current 67,057 - 538,187 -
Deferred 2,311 102,468 42,170 115,302
----- ------- ------ -------
69,368 102,468 580,357 115,302
------ ------- ------- -------
Net income $131,501 $221,114 $1,181,405 $247,164
======== ======== ========== ========
Earnings per common share:
Basic $0.07 $0.13 $0.64 $0.14
Diluted $0.07 $0.12 $0.61 $0.14
Weighted average common
shares outstanding:
Basic 1,874,866 1,764,649 1,836,999 1,771,222
Diluted 1,938,746 1,772,583 1,928,029 1,778,008
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, 2008. Mexco Energy Corporation disclaims any intention or obligation to revise any forward-looking statements.
SOURCE Mexco Energy Corporation
