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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