Market Overview

MEXCO ENERGY CORPORATION REPORTS FINANCIAL RESULTS FOR FISCAL 2018 AND ANNOUNCES FURTHER DEVELOPMENT OF PROPERTIES

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MIDLAND, TX , July 02, 2018 (GLOBE NEWSWIRE) -- Mexco Energy Corporation (NYSE:MXC) reported results on its Annual Report on Form 10-K to the Securities and Exchange Commission ("SEC") for the fiscal year ended March 31, 2018.

The Company reported a net loss of $321,489 or ($0.16) per diluted share, for fiscal year 2018, a decrease from a net loss of $694,553, or ($0.34) per diluted share, for fiscal 2017.

Operating revenues in fiscal 2018 were $2,705,235, an increase of 7% when compared to fiscal 2017 operating revenues of $2,525,363.  This is the result of a 18% increase in oil prices and a 17% increase in gas prices partially offset by an 11% decrease in gas production.

The Company reported a profit of $264,461 for the quarter ending March 31, 2018, the Company's fourth quarter of fiscal 2018, compared to a loss of $3,454 from the comparable quarter of fiscal 2017.  Operating revenues in the fourth quarter were $763,532 compared to $684,204 for the same quarter in fiscal 2017, an increase of 12%.  This is primarily the result of increased oil and natural gas prices and a decrease in depreciation, depletion and amortization.

The Company's estimated present value of proved reserves at March 31, 2018 was approximately $22 million based on estimated future net revenues discounted at 10% per annum, pricing and other assumptions set forth in "Item2 – Properties" of the Company's Form 10-K, a decrease of 13% as compared to the same at March 31, 2017.  The Company's estimated proved oil reserves at March 31, 2018 decreased 44% to 1.197 million barrels of oil and natural gas liquids, and natural gas reserves decreased 18% to 5.487 billion cubic feet over the prior fiscal year.  This reduction in reserves was due to sales of non-core properties and the restructuring of our plans for development of a non-producing leasehold interest in Martin County, Texas.  For fiscal 2018, oil constituted approximately 57% of the Company's total proved reserves and approximately 67% of the Company's revenues.

After fiscal 2018, Mexco reduced its bank indebtedness to $500,000 as of June 30, 2018, resulting in a debt to equity ratio of 6%.

In addition to an indeterminate number of wells to be drilled by other operators on Mexco's royalty interests, the Company currently expects to participate in the drilling and completion of approximately 50 horizontal wells, at an estimated aggregate cost of approximately $1,300,000 for the fiscal year ended March 31, 2019, of which approximately $141,000 has been expended to date.  The operators of these wells include Concho Resources, Inc., Marathon Oil Company, Mewbourne Oil Company, XTO Energy, Inc. and others.

Mexco Energy Corporation, a Colorado corporation, is an independent oil and gas company located in Midland, Texas engaged in the acquisition, exploration and development of oil and gas properties primarily in the Permian Basin.  For more information on Mexco Energy Corporation, go to www.mexcoenergy.com.

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, 2018.  Mexco Energy Corporation disclaims any intention or obligation to revise any forward-looking statements.



Mexco Energy Corporation and Subsidiaries
CONSOLIDATED BALANCE SHEETS
               
          March 31,   March 31,
            2018       2017  
ASSETS          
  Current assets      
    Cash and cash equivalents $   492,610     $   73,451  
    Accounts receivable:      
      Oil and gas sales     395,991         381,414  
      Trade     436,249         13,744  
    Prepaid costs and expenses     47,583         36,325  
        Total current assets     1,372,433         504,934  
               
  Property and equipment, at cost      
    Oil and gas properties, using the full cost method     35,224,784         37,640,096  
    Other       107,484         107,484  
    Accumulated depreciation, depletion and amortization   (26,453,025 )     (25,572,606 )
        Property and equipment, net     8,879,243         12,174,974  
           
    Other noncurrent assets   149,278       28,157  
        Total assets $   10,400,954     $   12,708,065  
               
LIABILITIES AND STOCKHOLDERS' EQUITY      
  Current liabilities      
    Accounts payable and accrued expenses $   446,815     $   137,259  
        Total current liabilities   446,815       137,259  
               
  Long-term debt     700,000         2,900,000  
  Asset retirement obligations   852,553         968,484  
        Total liabilities   1,999,368       4,005,743  
               
  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;      
      2,104,266 shares issued and 2,037,266 shares outstanding      
       as of March 31, 2018 and 2017, respectively     1,052,133         1,052,133  
    Additional paid-in capital     7,265,601         7,244,848  
    Retained earnings     429,853         751,342  
    Treasury stock, at cost (67,000 shares)     (346,001 )       (346,001 )
  Total stockholders' equity     8,401,586         8,702,322  
        Total liabilities and stockholders' equity $   10,400,954     $   12,708,065  


Mexco Energy Corporation and Subsidiaries
CONSOLIDATED STATEMENTS OF OPERATIONS
Years ended March 31,
           
        2018       2017  
Operating revenues:      
  Oil and gas $   2,650,232     $   2,337,222  
  Other   55,003       188,141  
    Total operating revenues   2,705,235       2,525,363  
           
Operating expenses:      
  Production   1,070,447       878,458  
  Accretion of asset retirement obligation   31,460       35,743  
  Depreciation, depletion and amortization   880,419       1,177,422  
  General and administrative   955,147       976,392  
    Total operating expenses   2,937,473       3,068,015  
           
Operating loss    (232,238 )     (542,652 )
           
Other income (expenses):      
  Interest income   286       225  
  Interest expense   (89,537 )     (152,126 )
    Net other (expense) income   (89,251 )     (151,901 )
           
Loss before provision for income taxes   (321,489 )     (694,553 )
           
Income tax   -       -  
           
Net loss $   (321,489 )   $   (694,553 )
           
           
Loss per common share:      
  Basic: $   (0.16 )   $   (0.34 )
  Diluted: $   (0.16 )   $    (0.34 )
           
Weighted average common shares outstanding:      
  Basic:   2,037,266       2,037,266  
  Diluted:   2,037,266       2,037,266  


 

For additional information, please contact:  

Nicholas C. Taylor, 
Chairman and Chief Executive Officer 

Tammy L. McComic, 
President and Chief Financial Officer 

Mexco Energy Corporation, (432) 682-1119.

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