MGM Energy Corp.
TSX : MGX

MGM Energy Corp.

March 23, 2011 17:10 ET

MGM Energy Corp. Announces 2010 Financial Results

CALGARY, ALBERTA--(Marketwire - March 23, 2011) -

THIS PRESS RELEASE IS NOT FOR DISTRIBUTION TO ANY UNITED STATES NEWSWIRE SERVICES OR OTHERWISE FOR DISTRIBUTION IN THE UNITED STATES. ANY FAILURE TO COMPLY WITH THIS RESTRICTION MAY CONSTITUTE A VIOLATION OF UNITED STATES SECURITIES LAWS.

MGM Energy Corp. ("MGM Energy" or the "Company") (TSX:MGX) announced today its financial results for the twelve months ended December 31, 2010.

The Company reported a net loss for the twelve months ended December 31, 2010 of $19.9 million ($0.07 per share) as compared to a net loss of $50.3 million ($0.19 per share) for the twelve months ended December 31, 2009.

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 (Unaudited)      
($000s)      
             
As at December 31   2010     2009  
             
ASSETS            
Current assets            
  Cash and cash equivalents $ 1,174   $ 4,486  
  Restricted cash   -     10,000  
  Accounts receivable and other current assets   1,640     1,650  
    2,814     16,136  
Property, plant and equipment   232,849     233,127  
Future income taxes   -     258  
  $ 235,663   $ 249,521  
             
LIABILITIES AND SHAREHOLDERS' EQUITY            
Current liabilities            
  Accounts payable and accrued liabilities $ 2,175   $ 2,601  
  Due to related parties   107     70  
    2,282     2,671  
Asset retirement obligations   2,343     2,159  
    4,625     4,830  
             
             
             
Shareholders' Equity            
  Share capital   454,465     449,735  
  Contributed surplus   7,968     6,420  
  Deficit   (231,395 )   (211,464 )
    231,038     244,691  
  $ 235,663   $ 249,521  
             
             


MGM Energy Corp.
     
Statements of Loss (Unaudited)      
($000s, except as noted)      
       
Years Ended December 31   2010     2009  
             
Revenue            
  Interest income $ 31   $ 236  
             
             
Expenses            
  General and administrative   4,175     4,882  
  Stock-based compensation   1,548     1,756  
  Pipeline regulatory and access   11     -  
  Exploration   2,904     2,404  
  Lease rental and land costs   9,525     1,286  
  Dry hole   477     39,147  
  Interest and financing charges   918     783  
  Accretion of asset retirement obligations   184     206  
  Gain on settlement of asset retirement obligation   -     (114 )
  Depreciation   220     466  
    19,962     50,816  
             
Loss before income tax   (19,931 )   (50,580 )
  Future income tax recovery   -     (258 )
Net lossand other comprehensive loss $ (19,931 ) $ (50,322 )
             
Net loss per Common Share ($/share)            
  Basic $ (0.07 ) $ (0.19 )
  Diluted $ (0.07 ) $ (0.19 )
             
Weighted average Common Shares outstanding (000s)            
  Basic   306,344     268,383  
  Diluted   306,344     268,383  
             
Statements of Deficit            
($000s)            
       
Years Ended December 31   2010     2009  
             
Deficit, beginning of year $ (211,464 ) $ (161,142 )
Net loss   (19,931 )   (50,322 )
Deficit, end of year $ (231,395 ) $ (211,464 )
             

MGM Energy Corp.
     
Statements of Cash Flows (Unaudited)      
($000s)      
       
Years Ended December 31   2010     2009  
             
Operating activities            
Net loss and other comprehensive loss $ (19,931 ) $ (50,322 )
Add (deduct):            
  Stock-based compensation   1,548     1,756  
  Exploration   2,904     2,404  
  Dry hole   477     39,147  
  Accretion of asset retirement obligations   184     206  
  Depreciation   220     466  
  Non-cash general and administrative expense   -     (32 )
  Gain on settlement of asset retirement obligations   -     (114 )
  Future income tax recovery   -     (258 )
    (14,598 )   (6,747 )
Change in non-cash working capital   9,625     (3,376 )
    (4,973 )   (10,123 )
             
Financing activities            
Common shares issued, net of issuance costs   4,988     3,413  
             
             
Investing activities            
Restricted cash contributions   -     (10,000 )
Capital expenditures   (3,323 )   (54,316 )
Change in non-cash working capital   (4 )   (6,489 )
    (3,327 )   (70,805 )
             
Decrease in cash and cash equivalents   (3,312 )   (77,515 )
Cash and cash equivalents, beginning of year   4,486     82,001  
Cash and cash equivalents, end of year $ 1,174   $ 4,486  
             

Contact Information

  • MGM Energy Corp.
    H.W. (Henry) Sykes
    President
    (403) 781-7800
    (403) 781-7801 (FAX)
    or
    MGM Energy Corp.
    R. N. (Rick) Miller
    Chief Financial Officer
    (403) 781-7800
    (403) 781-7801 (FAX)