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Press release from Marketwire

MGM Energy Corp: Financial Results for the Three and Six Months Ended June 30, 2011

Thursday, July 28, 2011

MGM Energy Corp: Financial Results for the Three and Six Months Ended June 30, 201117:23 EDT Thursday, July 28, 2011CALGARY, ALBERTA--(Marketwire - July 28, 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. (TSX:MGX) ("MGM Energy" or the "Company") announced today its financial results for the three and six months ended June 30, 2011. The Company reported a net loss for the three month period ended June 30, 2011 of $1.3 million ($5.6 million for the six month period ended June 30, 2011). 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).The Company also announced that it has posted an updated presentation on its website regarding the recent land acquired in the Central Mackenzie Valley. As announced on July 4, 2011, MGM Energy acquired a 50% interest in three parcels of land in the Central Mackenzie Valley. The presentation posted on the website provides additional information regarding MGM Energy's preliminary assessment of the liquids rich shale play in the Central Mackenzie Valley. As previously announced, MGM Energy intends to provide an update on its plans respecting these new land parcels by the end of September 2011. 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 and exploration and drilling plans and the timing thereof. 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.Condensed Interim Balance Sheets (Unaudited)($000s)As at June 30As at December 3120112010ASSETSCurrent assetsCash and cash equivalents$15,198$1,174Accounts receivable and other current assets5101,64015,7082,814Non-current assetsExploration and evaluation assets212,954233,051Property and equipment213272213,167233,323Total Assets$228,875$236,137LIABILITIESCurrent liabilitiesAccounts payable and accrued liabilities$307$2,175Due to related parties991074062,282Non-current liabilitiesAsset retirement obligations2,8102,9052,8102,905Total Liabilities3,2165,187SHAREHOLDERS' EQUITYShare capital454,465454,465Contributed surplus8,1417,820Deficit(236,947)(231,335)Total Shareholders' Equity225,659230,950Total Liabilities and Shareholders' Equity$228,875$236,137Note: MGM Energy adopted International Financial Reporting Standards ("IFRS") effective for fiscal years beginning on or after January 1, 2011 and the Company has applied IFRS as of January 1, 2010 for comparative purposes. Certain prior period amounts have been adjusted to reflect the changes in the Company's accounting policies.MGM Energy Corp.Condensed Interim Statements of Changes in Equity (Unaudited)($000s)Six Months Ended June 3020112010Share CapitalBalance, beginning of period$454,465$449,735Issue of Common Shares-4,988Tax adjustment on flow-through shares-(258)Balance, end of period$454,465$454,465Contributed SurplusBalance, beginning of period$7,820$6,334Share-based compensation321901Balance, end of period$8,141$7,235DeficitBalance, beginning of period$(231,335)$(211,591)Net loss(5,612)(5,439)Balance, end of period$(236,947)(217,030)Total Shareholders' Equity$225,659$244,670Note: MGM Energy adopted International Financial Reporting Standards ("IFRS") effective for fiscal years beginning on or after January 1, 2011 and the Company has applied IFRS as of January 1, 2010 for comparative purposes. Certain prior period amounts have been adjusted to reflect the changes in the Company's accounting policies.MGM Energy Corp.Condensed Interim Statements of Loss and Comprehensive Loss (Unaudited)($000s)Three Months Ended June 30Six Months Ended June 302011201020112010Oil and natural gas revenue$-$-$-$-ExpensesGeneral and administrative expenses6178741,5251,939Share-based compensation232619321901Exploration and evaluation expenditures2755775512,005Dry hole--2,804-Accretion of asset retirement obligation13152929Depreciation295559110Pipeline and regulatory expenses-4-111,1662,1445,2894,995Loss before net finance expenses(1,166)(2,144)(5,289)(4,995)Finance income(39)(13)(50)(19)Finance expenses170221373463Net finance expenses131208323444Net loss and comprehensive loss$(1,297)$(2,352)$(5,612)$(5,439)Net loss per Common Share ($/share)Basic$(0.00)$(0.01)$(0.02)$(0.02)Diluted$(0.00)$(0.01)$(0.02)$(0.02)Note: MGM Energy adopted International Financial Reporting Standards ("IFRS") effective for fiscal years beginning on or after January 1, 2011 and the Company has applied IFRS as of January 1, 2010 for comparative purposes. Certain prior period amounts have been adjusted to reflect the changes in the Company's accounting policies.MGM Energy Corp.Condensed Interim Statements of Cash Flows (Unaudited)($000s)Six Months Ended June 3020112010Operating activitiesNet loss for the period$(5,612)$(5,439)Adjustments to add non-cash itemsShare-based compensation321901Accretion of asset retirement obligation2929Depreciation59110Change in non-cash working capital(796)(809)Cash flows used in operating activities(5,999)(5,208)Financing activitiesCommon shares issued, net of issuance costs-4,988Cash flows from financing activities-4,988Investing activitiesCapital expenditures(27)31Proceeds from divestitures20,000-Change in non-cash working capital50(32)Cash flows used in (from) investing activities20,023(1)Increase (decrease) in cash and cash equivalents14,024(221)Cash and cash equivalents, beginning of period1,1744,486Cash and cash equivalents, end of period$15,198$4,265Note: MGM Energy adopted International Financial Reporting Standards ("IFRS") effective for fiscal years beginning on or after January 1, 2011 and the Company has applied IFRS as of January 1, 2010 for comparative purposes. Certain prior period amounts have been adjusted to reflect the changes in the Company's accounting policies.FOR FURTHER INFORMATION PLEASE CONTACT: H.W. (Henry) SykesMGM Energy Corp.President(403) 781-7800(403) 781-7801 (FAX)ORR.N. (Rick) MillerMGM Energy Corp.Chief Financial Officer(403) 781-7800(403) 781-7801 (FAX)