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L & L Energy Announces Second Quarter Fiscal 2012 Financial Results
SEATTLE, Dec. 12, 2011 /PRNewswire/ -- L & L Energy, Inc., (NASDAQ: LLEN)("L&L" or the "Company"), a U.S.-based company operating coal businesses in China, today announced its financial results for the second fiscal quarter ended October 31, 2011. The Company generated $41.9 million in sales for the second quarter and net income totaled $5.25 million.
Second Quarter 2012 Financial Summary
Ian Robinson, Chief Financial Officer, stated, "Our earnings and revenues have seen improvements from our first quarter as a result of our mining operations beginning to ramp up production in accordance with the changing regulatory environment. Although second quarter results have improved, we are still seeing the effects of intermittent temporary slowdown and idling of all mines in our region by the government."
- Revenues were $41.9 million, up 14% from the first quarter
- Net income was $5.25 million, up 70% from the first quarter
- Gross profit was $12.4 million, up 51% from the first quarter
- Earnings per share was $0.11 per diluted share, up 38% from the first quarter
Second Quarter 2012 Operational Summary
Dickson Lee, Chairman and CEO, commented, "I expect a challenging environment for our current operations to continue throughout the course of the consolidation process. However, we have positioned ourselves very well to benefit from the consolidation in the long run with the support we have received from the government and local banks. Additionally we are bolstering up our operations in Guizhou with the addition of new wholesale operations. This will increase our visibility throughout the region and create a strong revenue base."
Lee continued, "This past year has been challenging. The capital markets have also caused us to slow our acquisition plans, but as the business cycle turns, L&L will be well positioned to take advantage of this tremendous growth opportunity in Guizhou."
- CEO, Dickson Lee, meets and receives endorsement from the Vice Governor of Guizhou for L&L to take a leadership role in the provincial coal consolidation process.
- Pan County government also issues letter supporting L&L as a leader in the consolidation policy.
- Industrial and Commercial Bank of China issues an endorsement letter to L&L indicating it will provide up to 50% financing for a period of 5 years, subject to further due diligence.
L&L Focuses on Larger Mines and Strategic Partners
- Dr. Syd Peng, L&L Director and world renowned mining expert, led an inspection team to evaluate potential acquisition targets. Larger mines that present less risk, require less capital expenditures, and have strong management will be the initial focus.
- L&L signs two joint sales/marketing agreements with China Chengtong Metals Co. and Tianjin Fuhao Industrial Co. Ltd. If fully executed, the agreements collectively will generate approximately $US 300 million in revenues throughout calendar 2012.
- Mr. Jingcai Yang, former senior executive for the world's largest coal company, China Shenhua Group Corporation Limited, joins the Company as an advisor.
Lee added, "Working with large strategic partners like CCMC, Tianjin Fuhao and Mr. Yang, one of the founders of the largest coal company in the world, positions L&L for future growth. The synergies between L&L and these large partners is apparent, as they have traditionally focused in the north and we have focused in the southern regions of China. "
Forward-Looking Statements
The statements contained words that are not historical fact, including statements related to Company's future performance, are all "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, and involve a number of risks and uncertainties. Actual results of the future events described in this document could differ materially due to numerous factors and other made by the company filing with the Securities and Exchange Commission. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements.
Dickson Lee CPA, +1-206-264-8065, for L & L Financial Holdings, Inc.
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L & L ENERGY, INC. | |||||
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CONDENSED CONSOLIDATED BALANCE SHEETS | |||||
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AS OF OCTOBER 31, 2011 AND APRIL 30, 2011 | |||||
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(Unaudited) | |||||
|
|
|
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October 31, 2011 |
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April 30, 2011 |
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ASSETS |
|
|
|
| |
|
|
CURRENT ASSETS: |
|
|
|
|
|
|
Cash and cash equivalents |
$ |
5,794,298 |
$ |
4,914,425 |
|
|
Accounts receivables |
|
28,485,050 |
|
24,017,391 |
|
|
Prepaid and other current assets |
|
23,609,723 |
|
28,641,462 |
|
|
Other receivables |
|
837,166 |
|
2,586,147 |
|
|
Inventories |
|
9,242,740 |
|
6,633,019 |
|
|
Total current assets |
|
67,968,977 |
|
66,792,444 |
|
|
|
|
|
|
|
|
|
Property, plant, equipment, and mine development, net |
|
100,287,627 |
|
96,479,552 |
|
|
Construction-in-progress |
|
58,046,584 |
|
44,943,609 |
|
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Intangible assets, net |
|
843,498 |
|
902,555 |
|
|
Goodwill |
|
3,071,441 |
|
2,988,175 |
|
|
Restricted Cash |
|
564,550 |
|
544,588 |
|
|
Long term receivable |
|
7,391,479 |
|
7,272,828 |
|
|
Related party notes receivable |
|
6,224,886 |
|
7,428,574 |
|
|
Total non-current assets |
|
176,430,065 |
|
160,559,881 |
|
|
|
|
|
|
|
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TOTAL ASSETS |
$ |
244,399,042 |
$ |
227,352,325 | |
|
|
|
|
|
|
|
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LIABILITIES AND EQUITY |
|
|
|
| |
|
CURRENT LIABILITIES: |
|
|
|
| |
|
|
Accounts payables |
$ |
5,025,342 |
$ |
3,439,460 |
|
|
Accrued and other liabilities |
|
866,272 |
|
717,298 |
|
|
Other payables |
|
5,996,245 |
|
7,546,391 |
|
|
Payables-related party |
|
15,588,508 |
|
17,264,815 |
|
|
Due to officer |
|
995,000 |
|
1,070,000 |
|
|
Taxes payables |
|
19,702,963 |
|
18,835,276 |
|
|
Customer deposits |
|
2,300,768 |
|
4,338,424 |
|
|
Bank loans |
|
5,535,085 |
|
5,385,030 |
|
|
Total current liabilities |
|
56,010,183 |
|
58,596,694 |
|
|
|
|
|
|
|
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LONG-TERM LIABILITIES |
|
|
|
| |
|
|
Related party payable - non-current |
|
800,000 |
|
800,000 |
|
|
Asset retirement obligation |
|
2,115,380 |
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1,978,877 |
|
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Total long-term liabilities |
|
2,915,380 |
|
2,778,877 |
|
|
|
|
|
|
|
|
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Total Liabilities |
|
58,925,563 |
|
61,375,571 |
|
|
|
|
|
|
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EQUITY: |
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|
|
| |
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L&L ENERGY STOCKHOLDERS' EQUITY: |
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|
| |
|
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Preferred stock, no par value, 2,500,000 shares authorized, none issued and outstanding |
|
- |
|
- |
|
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Common stock,$0.001 par value, 120,000,000 shares authorized: 32,811,044 shares issued and outstanding, and 32,277,579 shares issued and outstanding at October 31 and April 30, respectively |
|
32,811 |
|
32,278 |
|
|
Shares to be issued,14,375 shares |
|
14 |
|
|
|
|
Additional paid-in capital |
|
54,092,689 |
|
48,420,321 |
|
|
Accumulated other comprehensive income |
|
10,989,043 |
|
6,502,542 |
|
|
Retained Earnings |
|
88,064,167 |
|
81,888,339 |
|
|
Treasury stock , 253,093 shares and 1,259,000 shares at October 31 and April 30, respectively |
|
(222,778) |
|
(396,859) |
|
|
Total L & L Energy stockholders' equity |
|
152,955,946 |
|
136,446,621 |
|
|
Non-controlling interest |
|
32,517,533 |
|
29,530,133 |
|
|
Total equity |
|
185,473,479 |
|
165,976,754 |
|
TOTAL LIABILITIES AND EQUITY |
$ |
244,399,042 |
$ |
227,352,325 | |
|
|
|
|
|
|
|
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The accompanying notes are an integral part of these consolidated financial statements. | |||||
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L & L ENERGY, INC. | |||||||||
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CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME | |||||||||
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FOR THE THREE AND SIX MONTH PERIODS ENDED OCTOBER 31, 2011 AND 2010 | |||||||||
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(Unaudited) | |||||||||
|
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For The Three Months Periods Ended October 31, |
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For The Six Months Periods Ended October 31, | ||||||
|
|
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2011 |
|
2010 |
|
|
2011 |
|
2010 |
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NET REVENUES |
$ |
41,873,840 |
$ |
57,417,686 |
|
$ |
78,507,146 |
$ |
112,747,625 |
|
COST OF REVENUES |
|
29,478,282 |
|
38,145,895 |
|
|
57,922,257 |
|
74,870,158 |
|
GROSS PROFIT |
|
12,395,558 |
|
19,271,791 |
|
|
20,584,889 |
|
37,877,467 |
|
|
|
|
|
|
|
|
|
|
|
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OPERATING COSTS AND EXPENSES: |
|
|
|
|
|
|
|
|
|
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Salaries & wages-selling, general and administrative |
|
2,611,902 |
|
1,956,269 |
|
|
3,544,902 |
|
2,736,941 |
|
Selling, general and administrative expenses, excluding salaries and wages |
|
3,366,842 |
|
2,900,999 |
|
|
6,384,891 |
|
6,126,608 |
|
Total operating expenses |
|
5,978,744 |
|
4,857,268 |
|
|
9,929,793 |
|
8,863,549 |
|
|
|
|
|
|
|
|
|
|
|
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INCOME FROM OPERATIONS |
|
6,416,814 |
|
14,414,523 |
|
|
10,655,096 |
|
29,013,918 |
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OTHER INCOME (EXPENSE): |
|
|
|
|
|
|
|
|
|
|
Interest income (expense) |
|
108,307 |
|
(100,928) |
|
|
306,655 |
|
(171,468) |
|
Other income (expense) |
|
(481,273) |
|
420,960 |
|
|
(1,248,834) |
|
408,117 |
|
Total other income (expense) |
|
(372,966) |
|
320,032 |
|
|
(942,179) |
|
236,649 |
|
|
|
|
|
|
|
|
|
|
|
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INCOME BEFORE PROVISION FOR INCOME TAXES |
|
6,043,848 |
|
14,734,555 |
|
|
9,712,917 |
|
29,250,567 |
|
LESS PROVISION FOR INCOME TAXES |
|
788,467 |
|
2,006,205 |
|
|
1,374,334 |
|
4,189,505 |
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INCOME BEFORE |
|
5,255,381 |
|
12,728,350 |
|
|
8,338,583 |
|
25,061,062 |
|
|
|
|
|
|
|
|
|
|
|
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Income attributable to non-controlling interests |
|
1,465,441 |
|
1,667,492 |
|
|
2,162,755 |
|
3,061,690 |
|
Income attributable to L & L |
|
3,789,940 |
|
11,060,858 |
|
|
6,175,828 |
|
21,999,372 |
|
|
|
|
|
|
|
|
|
|
|
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NET INCOME |
$ |
5,255,381 |
$ |
12,728,350 |
|
$ |
8,338,583 |
$ |
25,061,062 |
|
|
|
|
|
|
|
|
|
|
|
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OTHER COMPREHENSIVE INCOME: |
|
|
|
|
|
|
|
|
|
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Foreign currency translation gain |
|
3,273,921 |
|
1,620,744 |
|
|
4,486,501 |
|
2,659,576 |
|
COMPREHENSIVE INCOME |
$ |
8,529,302 |
$ |
14,349,094 |
|
$ |
12,825,084 |
$ |
27,720,638 |
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income attributable to non-controlling interests |
$ |
2,006,831 |
$ |
1,667,492 |
|
$ |
2,867,882 |
$ |
|
|
Comprehensive income attributable to L & L |
|
6,522,471 |
|
12,681,602 |
|
|
9,957,202 |
|
27,720,638 |
|
|
|
|
|
|
|
|
|
|
|
|
INCOME PER COMMON SHARE – basic |
$ |
0.12 |
$ |
0.37 |
|
$ |
0.19 |
$ |
0.75 |
|
|
|
|
|
|
|
|
|
|
|
|
INCOME PER COMMON SHARE – diluted |
$ |
0.11 |
$ |
0.35 |
|
$ |
0.19 |
$ |
0.72 |
|
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING – basic |
|
32,225,085 |
|
29,923,091 |
|
|
31,788,767 |
|
29,480,271 |
|
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING - diluted |
|
33,385,777 |
|
31,225,945 |
|
|
32,949,459 |
|
30,719,093 |
|
|
|
|
|
|
|
|
|
|
|
|
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The accompanying notes are an integral part of these consolidated financial statements | |||||||||
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L & L ENERGY, INC. | |||||
|
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS | |||||
|
FOR THE SIX MONTHS ENDED OCTOBER 31, 2011 AND 2010 | |||||
|
(Unaudited) | |||||
|
|
|
2011 |
|
2010 | |
|
CASH FLOWS FROM OPERATING ACTIVITIES: |
|
|
|
| |
|
Net income |
$ |
8,338,583 |
$ |
25,061,062 | |
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
| |
|
|
Depreciation and amortization |
|
3,556,845 |
|
4,632,395 |
|
|
Stock compensation |
|
2,261,045 |
|
3,030,138 |
|
|
Accretion of asset retirement obligation |
|
136,503 |
|
- |
|
|
Accounts receivable |
|
(4,467,659) |
|
(3,496,710) |
|
|
Prepaid and other current assets |
|
5,031,739 |
|
7,204,621 |
|
|
Inventories |
|
(2,609,721) |
|
(2,343,748) |
|
|
Other receivable |
|
785,330 |
|
(660,520) |
|
|
Accounts payable and other payable |
|
(145,957) |
|
2,419,096 |
|
|
Customer deposit |
|
(2,037,656) |
|
(1,303,040) |
|
|
Accrued and other liabilities |
|
148,974 |
|
(422,040) |
|
|
Taxes payable |
|
867,687 |
|
4,778,676 |
|
|
Note receivable |
|
1,203,688 |
|
(9,563,489) |
|
Net cash provided by operating activities |
|
13,069,401 |
|
29,336,441 | |
|
|
|
|
|
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES: |
|
|
|
| |
|
|
Acquisition of property and equipment |
|
(665,714) |
|
(8,240,277) |
|
|
Construction-in-progress |
|
(15,457,929) |
|
(20,719,831) |
|
|
Increase in investments |
|
(118,651) |
|
- |
|
|
Cash received from spin-off HSC |
|
963,651 |
|
- |
|
Net cash (used in) provided by investing activities |
|
(15,278,643) |
|
(28,960,108) | |
|
|
|
|
|
|
|
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CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
| |
|
|
Payment on bank loans |
|
- |
|
(1,362,519) |
|
|
Due to officer |
|
(75,000) |
|
- |
|
|
Proceeds from warrant extension |
|
- |
|
50,000 |
|
|
Proceeds from Treasury stock sold |
|
3,585,951 |
|
- |
|
|
Payment to previous owner of acquired mine |
|
(1,676,307) |
|
- |
|
|
Warrants converted to common stock |
|
- |
|
2,069,750 |
|
Net cash provided by financing activities |
|
1,834,644 |
|
757,231 | |
|
|
|
|
|
|
|
|
Effect of exchange rate changes on cash and cash equivalents |
|
1,254,471 |
|
873,861 | |
|
|
|
|
|
|
|
|
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS |
|
879,873 |
|
2,007,425 | |
|
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD |
|
4,914,425 |
|
7,327,369 | |
|
CASH AND CASH EQUIVALENTS, END OF PERIOD |
$ |
5,794,298 |
$ |
9,334,794 | |
|
|
|
|
|
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SUPPLEMENTAL INFORMATION |
|
|
|
| |
|
INTEREST PAID |
$ |
73,443 |
$ |
160,368 | |
|
INCOME TAX PAID |
$ |
719,843 |
$ |
2,389,338 | |
SOURCE L & L Energy, Inc.
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