MGM Energy Corp.
TSX : MGX

MGM Energy Corp.

October 29, 2013 19:30 ET

MGM Energy Corp.: Financial Results for the Three and Nine Months Ended September 30, 2013

CALGARY, ALBERTA--(Marketwired - Oct. 29, 2013) - MGM Energy Corp. (TSX:MGX) ("MGM Energy" or the "Company") announced today its financial results for the three month and nine month periods ended September 30, 2013.

The Company reported a net loss for the three month period ended September 30, 2013 of $3.0 million ($0.01 per share) as compared to a net loss of $2.1 million ($0.01 per share) for the three month period ended September 30, 2012. MGM Energy had working capital of $11.0 million as at September 30, 2013, which is expected to be sufficient to fund operations based on current level of expenditures until mid-2015. MGM Energy's full unaudited financial statements and accompanying Management's Discussion and Analysis will be filed shortly on the SEDAR website (www.sedar.com).

MGM Energy continues to analyze the results of the East Mackay I-78 well drilled in the Canol shale oil play in the winter of 2012/13 and anticipates that it will provide an update of its original oil in place estimate during the fourth quarter of 2013. The Company will also begin a formal search for a partner on its Canol shale oil play lands in the fourth quarter.

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. Such forward-looking statements or information are based on a number of assumptions which may prove to be incorrect. Forward-looking information in this news release includes, but is not limited to, MGM Energy's expectations regarding sufficiency of working capital to fund future costs to mid-2015 and the Company's intention to begin a formal search for a partner on its Canol shale oil lands. 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
September 30
As at
December 31
2013 2012
ASSETS
Current assets
Cash and cash equivalents $ 11,199 $ 19,869
Accounts receivable and other current assets 3,117 552
14,316 20,421
Non-current assets
Exploration and evaluation assets 64,533 63,971
Property and equipment, net - 136
64,533 64,107
Total Assets $ 78,849 $ 84,528
LIABILITIES
Current liabilities
Accounts payable and accrued liabilities $ 3,248 $ 5,352
Due to related parties 43 93
3,291 5,445
Non-current liabilities
Asset retirement obligation 4,570 4,018
Environmental restoration liability 566 -
5,136 4,018
Total Liabilities 8,427 9,463
SHAREHOLDERS' EQUITY
Share capital 466,159 466,132
Contributed surplus 9,953 9,201
Deficit (405,690) (400,268)
Total Shareholders' Equity 70,422 75,065
Total Liabilities and Shareholders' Equity $ 78,849 $ 84,528
MGM Energy Corp.
Statements of Loss and Comprehensive Loss (Unaudited)
($000s)
Three Months Ended
September 30
Nine Months Ended
September 30
2013 2012 2013 2012
Oil and natural gas revenue $ - $ - $ - $ -
Rental income - - 531 -
- - 531 -
Expenses
General and administrative 675 623 2,103 2,199
Share-based compensation 237 67 733 354
Exploration and evaluation 1,981 1,182 2,811 2,732
Accretion of asset retirement obligation 12 10 33 30
Depreciation - 25 15 68
2,905 1,907 5,695 5,383
Loss before net finance expenses (2,905) (1,907) (5,164) (5,383)
Finance income (26) (15) (95) (62)
Finance expenses 71 255 353 607
Net finance expenses 45 240 258 545
Net loss and comprehensive loss $ (2,950) $ (2,147) $ (5,422) $ (5,928)
Net loss per Common Share ($/share)
Basic $ (0.01) $ (0.01) $ (0.01) $ (0.02)
Diluted $ (0.01) $ (0.01) $ (0.01) $ (0.02)
MGM Energy Corp.
Statements of Cash Flows (Unaudited)
($000s)
Nine Months Ended
September 30
2013 2012
Operating activities
Net loss for the period $ (5,422) $ (5,928)
Adjustments to add (deduct) non-cash items
Share-based compensation 733 354
Non-cash general and administrative expenses (11) 32
Accretion of asset retirement obligation 33 30
Depreciation 15 68
Change in non-current environmental restoration provision 566 -
Change in non-cash working capital (330) (1,444)
Cash flows used in operating activities (4,416) (6,888)
Financing activities
Cash payment for options exercised (20) -
Cash received pursuant to exercise of options 27 -
Cash flows from financing activities 7 -
Investing activities
Capital expenditures 128 (659)
Recovery of amounts from Farmout Agreement previously capitalized - 617
Change in non-cash working capital (4,389) (403)
Cash flows used in investing activities (4,261) (445)
Decrease in cash and cash equivalents (8,670) (7,333)
Cash and cash equivalents, beginning of period 19,869 12,064
Cash and cash equivalents, end of period $ 11,199 $ 4,731

Contact Information

  • 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)