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MGM Energy Corp. Announces 2012 Financial Results and Provides Operation Update

Mar 11 2013 12:00AM

Marketwire

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CALGARY, ALBERTA -- (Marketwire) -- 03/11/13 -- MGM Energy Corp. (TSX: MGX) ("MGM Energy" or the "Company") announced today its financial results for the year ended December 31, 2012.

The Company reported a net loss for the year ended December 31, 2012 of $8.1 million ($0.03 per share) as compared to a net loss of $160.9 million ($0.51 per share) for the year ended December 31, 2011. The loss for the year ended December 31, 2012 was reduced significantly from the loss in the prior year as there was a writedown in the book value of the Company's northern Canadian petroleum and natural gas properties of $150 million for the year ended December 31, 2011.

MGM Energy also announced that it had completed fraccing operations at the East MacKay I-78 well and that the testing phase of the well is continuing. An update will be provided following the completion of the testing phase, which is expected before the end of March.

MGM Energy's full audited financial statements and accompanying Management's Discussion and Analysis will be filed shortly on the SEDAR website (www.sedar.com). MGM Energy is a Canadian oil and natural gas exploration and development company active in Northern Canada. MGM Energy's common shares are listed on the Toronto Stock Exchange under the symbol "MGX".

Certain statements or information included in this press release constitute forward-looking statements under applicable securities legislation. Forward-looking statements or information in this press release include but are not limited to business strategy and objectives, exploration and drilling plans and the timing thereof, as well as the anticipated timing for seeking regulatory approvals. Such forward-looking statements or information are based on a number of assumptions which may prove to be incorrect. Although MGM Energy believes that the expectations reflected in such forward-looking statements or information are reasonable, undue reliance should not be placed on forward-looking statements because MGM Energy can give no assurance that such expectations will prove to be correct. Forward-looking statements or information are based on current expectations, estimates and projections that involve a number of risks and uncertainties which could cause actual results to differ materially from those anticipated by MGM Energy and described in the forward-looking statements or information. The forward-looking statements or information contained in this document are made as of the date hereof and MGM Energy undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

MGM Energy Corp.Balance Sheets($000s)As at December 31 2012 2011----------------------------------------------------------------------------ASSETSCurrent assets Cash and cash equivalents $ 19,869 $ 12,064 Accounts receivable and other current assets 552 552---------------------------------------------------------------------------- 20,421 12,616Non-current assets Exploration and evaluation assets 63,971 63,929 Property and equipment, net 136 163---------------------------------------------------------------------------- 64,107 64,092---------------------------------------------------------------------------- $ 84,528 $ 76,708----------------------------------------------------------------------------LIABILITIESCurrent liabilities Accounts payable and accrued liabilities $ 5,352 $ 1,782 Due to related parties 93 86---------------------------------------------------------------------------- 5,445 1,868Non-current liabilities Asset retirement obligations 4,018 3,977---------------------------------------------------------------------------- 4,018 3,977--------------------------------------------------------------------------------------------------------------------------------------------------------Total Liabilities 9,463 5,845----------------------------------------------------------------------------SHAREHOLDERS' EQUITY Share capital 466,132 454,465 Contributed surplus 9,201 8,592 Deficit (400,268) (392,194)----------------------------------------------------------------------------Total Shareholders' Equity 75,065 70,863----------------------------------------------------------------------------Total Liabilities and Shareholders' Equity $ 84,528 $ 76,708----------------------------------------------------------------------------MGM Energy Corp.Statements of Loss and Comprehensive Loss($000s, except as noted)Years Ended December 31 2012 2011----------------------------------------------------------------------------Oil and natural gas revenue $ - $ -----------------------------------------------------------------------------Expenses General and administrative 3,393 3,526 Share-based compensation 548 763 Exploration and evaluation 3,405 2,530 Dry hole - 3,189 Accretion of asset retirement obligation 41 57 Impairment of petroleum and natural gas properties - 150,000 Depreciation 93 121---------------------------------------------------------------------------- 7,480 160,186----------------------------------------------------------------------------Loss before net finance expense (7,480) (160,186)---------------------------------------------------------------------------- Finance income (78) (120) Finance expense 672 793----------------------------------------------------------------------------Net finance expense 594 673--------------------------------------------------------------------------------------------------------------------------------------------------------Net loss and comprehensive loss $ (8,074) $ (160,859)----------------------------------------------------------------------------Net loss per common share ($/share) Basic $ (0.03) $ (0.51) Diluted $ (0.03) $ (0.51)MGM Energy Corp.Statements of Cash Flows($000s)Years Ended December 31 2012 2011----------------------------------------------------------------------------Operating activitiesNet loss $ (8,074) $ (160,859)Adjustments to add (deduct) non-cash items Stock-based compensation 548 763 Non-cash general and administrative expense 61 34 Increase in asset retirement obligation - 385 Accretion of asset retirement obligations 41 57 Impairment of petroleum and natural gas properties - 150,000 Depreciation 93 121Change in non-cash working capital (68) 669----------------------------------------------------------------------------Cash flows used in operating activities (7,399) (8,830)----------------------------------------------------------------------------Financing activitiesCash payment for options exercised - (25)Common shares issued, net of issuance costs 11,667 -----------------------------------------------------------------------------Cash flows from financing activities 11,667 (25)----------------------------------------------------------------------------Investing activitiesCapital expenditures (109) (260)Proceeds from divestitures - 20,000Change in non-cash working capital 3,646 5----------------------------------------------------------------------------Cash flows from investing activities 3,537 17,945----------------------------------------------------------------------------Increase in cash and cash equivalents 7,805 10,890Cash and cash equivalents, beginning of year 12,064 1,174----------------------------------------------------------------------------Cash and cash equivalents, end of year $ 19,869 $ 12,064--------------------------------------------------------------------------------------------------------------------------------------------------------





Contacts:
MGM Energy Corp.
H.W. (Henry) Sykes
President
(403) 781-7800
(403) 781-7801 (FAX)

MGM Energy Corp.
R. N. (Rick) Miller
Chief Financial Officer
(403) 781-7800
(403) 781-7801 (FAX)





Source: Marketwire


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