Saturday, December 19, 2009

L & L International Holdings Announces Second Quarter Fiscal 2010 Financial Results

On Wednesday December 16, 2009, 10:35 am EST

SEATTLE, Dec. 16 /PRNewswire-FirstCall/ -- L&L International Holdings, Inc. (OTC Bulletin Board: LLFH) ("L&L"), a U.S. company operating coal businesses in China, announced financial results for the quarter ended October 31, 2009. Earnings in the second quarter of fiscal year 2010 totaled $6.94 million, or $0.29 per diluted share, exceeding the prior-year period of $2.35 million, or $0.10 per diluted share.

Highlights for Second Quarter Fiscal 2010 Financial Results:

  • Revenues increased approximately 139% year-over-year to $24.48 million.
  • Net income increased by 195% year-over-year to $6.94 million.
  • Acquired 93% controlling interest in Hon Shen coking operations and an additional 28% of Hon Shen coal-washing facilities located in Yunnan Province.


"Strong results from our coal mining and coal-washing facilities will continue to add to our top and bottom lines in the second half of fiscal 2010," said Dickson Lee, Chairman and CEO of L&L. "With the acquisition of Hon Shen coking, we completed vertical integration for our coal businesses. We will continue to expand production at our coal mines and pursue strategic joint ventures. With revenues generated by Hon Shen and the expansion at our DaPuAn and SuTsong coal mines, we expect continued growth for fiscal year 2010."

Results of Operations

Coal revenues for Q2-2010 were derived entirely in China, from coal mining, coal washing, coking and coal wholesale operations. The Company conducted all its coal (energy) operations in Yunnan province. As of October 31, 2009, L&L owned 100% of KMC coal wholesale operations, and majority equity controlling interest of the DaPuAn Coal Mine and SuTsong Mine under the provisional name of L&L Coal Partners (the "2 Mines"), and Hon Shen Coal Co. Ltd. (coal washing operation and coking operation) ("HSC").

On July 16, 2009, the Company acquired 65% equity interest of coal washing facilities of Hon Shen. On October 23, 2009, L&L increased its interest from 65% to 93%. Additionally, L&L acquired 93% equity interest in Hon Shen's coking facilities, thus reaching an overall 93% equity interest of HSC's coal washing and coking operations.

Total Revenue and Gross Profit

During Q2-2010, L&L sales increased approximately 139% to $24.48 million from $10.24 million in Q2-2009. Mining contributed sales of $12.4 million, HSC contributed sales of $8.3 million, and KMC contributed sales of $3.7 million to the Company. Gross profit in Q2-2010 was $12.67 million, 122% higher than $5.7 million in Q2-2009.

Net Income and Earnings Per Share

Net income totaled $6.94 million in Q2-2010, 195% higher than $2.35 million in Q2-2009. The increase was mainly due to the acquisition of HSC and increased efficiencies of mining operations.

Operating Expenses

Operating expenses totaled $3.52 million in Q2-2010, increasing 207% from $1.15 million, for Q2-2009. The increase was due to the Company's rapid growth and new acquisitions which led to higher personnel, legal and professional expenses.

Business Objectives for Fiscal Year 2010

L&L plans continued expansion in its mining operations, including its DaPuAn mine from 150,000 tons to 300,000 tons and its SuTsong mine from 90,000 tons to 150,000 tons. L&L also plans additional acquisitions to increase coal sales and gain access to higher margin markets. Additionally, through its wholesale KMC subsidiary, L&L expects to process 300,000 tons of coal supported by five other strategic mining partners for the new fiscal year 2010.

About L & L International Holdings

Founded in 1995 and headquartered in Seattle, Washington, L&L serves the vast energy market in China through the operation and acquisition of coal mining, consolidation and distribution facilities. Led by an experienced, multi-lingual management team, the Company owns and operates coal mines and coal wholesaler networks in China. For further information, please visit the Company's website at http://www.lnlinternational.com.

L & L INTERNATIONAL HOLDINGS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

AS OF OCTOBER 31, 2009 and APRIL 30, 2009

(UNAUDITED)



October 31, 2009

April 30, 2009

ASSETS




CURRENT ASSETS:




Cash and cash equivalents

$11,345,517

$5,098,711


Accounts receivable

19,518,573

16,906,010


Prepaid and other current assets

5,429,122

3,611,371


Other Receivables

7,666,357

9,360,881


Inventories

3,200,571

1,524,493


Loan to business associates

1,866,917

5,983,636


Total current assets

49,027,057

42,485,102






Property and equipment, net

12,694,855

5,243,142


Construction-in-progress

10,061,162

2,085,134


Intangible assets, net

2,557,303

2,507,331


Investments

1,539,792

1,275,660


Investment held in a subsidiary disposed of

573,677

573,677


Deferred tax assets

105,175

105,329


Total non-current assets

27,531,964

11,790,273





TOTAL ASSETS

$76,559,021

$54,275,375

LIABILITIES AND STOCKHOLDERS' EQUITY



CURRENT LIABILITIES:




Accounts payable

$1,601,893

$4,930,866


Accrued and other liabilities

1,881,479

953,395


Current portion of long-term payable

3,795,360

3,000,000


Taxes payable

6,371,517

6,014,922


Customer deposits

2,303,770

300,435


Bank loan

1,742,313

-


Due to shareholder

-

910,791


Total current liabilities

17,696,332

16,110,409





LONG-TERM LIABILITIES




Long-term payable

3,250,366

3,000,000


Total long-term liabilities

3,250,366

3,000,000


Total Liabilities

20,946,698

19,110,409

EQUITY:



STOCKHOLDERS' EQUITY:




Preferred stock, no par value, 2,500,000 shares authorized, none issued and outstanding

-

-


Common stock, $0.001 par value, 120,000,000 shares authorized, 24,712,720 and 21,202,200 shares issued for October 31, 2009 and April 30, 2009, respectively

24,713

21,201


Paid-in Capital

29,602,451

9,604,694


Service cost being amortized

(5,037,453)

-


Deferred stock compensation

(44,667)

(63,667)


Accumulated other comprehensive income

631,808

669,913


Retained Earnings

21,841,748

12,200,838


Total stockholders' equity

47,018,600

22,432,979


Non-controlling interest

8,593,723

12,731,987


Total Equity

55,612,323

35,164,966

TOTAL LIABILITIES AND EQUITY

$76,559,021

$54,275,375





L & L INTERNATIONAL HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

FOR THE THREE MONTHS AND NINE MONTHS ENDED OCTOBER 31, 2009 AND 2008

(UNAUDITED)


For the Three Months Ended October 31

For the Six Months Ended October 31


2009

2008

2009

2008

NET REVENUES

$24,482,676

$10,244,949

$37,227,726

$20,910,930

COST OF REVENUES

11,809,412

4,541,646

18,494,051

9,465,941

GROSS PROFIT

12,673,264

5,703,303

18,733,675

11,444,989






OPERATING COSTS AND EXPENSES:





Salaries & wages

1,592,617

533,686

1,920,565

874,386

Selling, general and administrative expenses

1,930,986

612,938

2,756,924

1,326,627

Total operating expenses

3,523,603

1,146,624

4,677,489

2,201,013






INCOME FROM OPERATIONS

9,149,661

4,556,679

14,056,186

9,243,976

OTHER EXPENSES (INCOME):





Interest expense

29,704

34,836

33,302

95,221

Other expenses (income), net

(528,697)

76,272

(629,055)

85,003

Total other expenses (income)

(498,993)

111,108

(595,753)

180,224






INCOME FROM CONTINUED OPERATION BEFORE PROVISION FOR INCOME TAXES, DISCONTINUED OPERATIONS AND NON-CONTROLLING INTEREST

9,648,654

4,445,571

14,651,939

9,063,752

LESS PROVISION FOR INCOME TAXES

814,764

269,484

1,167,398

572,157

INCOME FROM CONTINUED OPERATION BEFORE DISCONTINUED OPERATIONS AND NON-CONTROLLING INTEREST

8,833,890

4,176,087

13,484,541

8,491,595

DISCONTINUED OPERATIONS, Net of tax

-

27,097

-

69,138

NET INCOME

8,833,890

4,203,184

13,484,541

8,560,733

LESS NET INCOME ATTRIBUTABLE TO NON-CONTROLLING INTERESTS

1,887,109

1,849,312

3,843,631

3,626,497

NET INCOME ATTRIBUTABLE TO THE COMPANY

6,946,781

2,353,872

9,640,910

4,934,236






OTHER COMPREHENSIVE INCOME:





Foreign currency translation income (loss)

-

434

(38,105)

570,244

COMPREHENSIVE INCOME

$6,946,781

$2,354,306

$9,602,805

$5,504,480






INCOME PER COMMON SHARE – basic from continued operation

$0.31

$0.11

$0.44

$0.22

INCOME PER COMMON SHARE – basic from discontinued operation

$0.00

$0.00

$0.00

$0.01

INCOME PER COMMON SHARE – basic

$0.31

$0.11

$0.44

$0.23






INCOME PER COMMON SHARE – diluted from continued operation

$0.29

$0.10

$0.41

$0.22

INCOME PER COMMON SHARE – diluted from discontinued operation

$0.00

$0.00

$0.00

$0.00

INCOME PER COMMON SHARE – diluted

$0.29

$0.10

$0.41

$0.22






WEIGHTED AVERAGE COMMON SHARES OUTSTANDING – basic

22,726,935

21,987,912

21,964,044

21,671,211

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING – diluted





24,397,083

22,386,910

23,634,192

22,070,209

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