L & L Energy (NASDAQ:LLEN)

SEATTLE, Jan. 30, 2012  /PRNewswire/ -- L & L Energy, Inc., (Nasdaq: LLEN) ("L&L" or the "Company"), a U.S.-based company founded in 1995 with coal mining and distribution businesses in China, announced today that it has entered an agreement acquiring 51% controlling interest of the Weishe coal mine ("The Mine" or "Weishe") in China.  

Weishe Mine Acquisition Highlights          

• Purchase Price:            Approximately $16.2 million, to be paid in full with 3 million LLEN shares at $5.396/share
• Interest %:                   51% controlling interest
• Mine Reserves:            19 million tons in a 1.8 square KM site
• Design:                        450,000 ton annually  

Estimated FY2013 (Ended April 30) Impact of Weishe

• Production:                                124,000 tons
• Price per ton:                              $158
• Revenues:                                  $19.6 million
• EBITA:                                       $9.8 million
• Cash flow attributable to L&L:       $3.75 million

Weishe mine produces high quality, low sulfur, anthracite coal, and is one of three newly constructed mines owned by Union Energy located in Hezhang, Guizhou Province, China. The mine is expected to be expanded to its designed 450,000 tons of annual production over the next few years.

Dr. Syd Peng, L&L board member and world-renown mine expert, said, "I welcome the new Weishe mine, which is the first of many new mines we are targeting to upgrade our mining portfolio for better safety and mechanization."  Mr. Po Shui, owner of Union Energy, a local Guizhou company, stated, "I believe in L&L and am pleased to take common shares as payment. I also look forward to the possibility of joint venturing with L&L on two other Union Energy mines, one of which is scheduled to begin producing in the spring and the other in the fall of this year."

Dickson Lee, Chairman and CEO of L&L Energy commented, "L&L Energy has been focused on executing our plan for the Guizhou consolidation. With the recently established Hong Gou operational office in Guizhou, the government's approval of our new wholesales license, and now the addition of the Weishe Mine, we are positioning ourselves well to fully execute the two one millions ton wholesale agreements negotiated in the fall of 2011," Lee continued. "The management team at the Weishe mine is very strong and will be excellent addition to L&L as we scale at a faster pace. To share in our excitement, we invite investors to visit our new operations this summer."

GeoInvesting Stands by its Claims that L&L Energy does not Own the Ping Yi Mine: More Color Provided

We understand that some investors have attempted to discredit our research, observing differences between the mining permit number/address on the official Ping Ying Mine chopped business license and Mining Permit compared to web sites posting disclosing the sale of the Ping Yi Mine. Conclusions based on this observation are baseless.

The Mining Permit number issue in no way unsubstantiates our findings. Our research is based on a mountain of findings.

1. Our research was performed using the official Business License and Mining Permit posted by the owner. Website postings are secondary to our conclusions, except for the sale information itself.
2. We have obtained an official chopped SAIC filing of the Ping Yi Mine that clearly shows that LLEN does not own this mine.
3. Most importantly, the press release issued by LLEN on Jan 17, 2012 states that, "Regarding the sale notices mentioned by GeoInvesting in its article, the Company never authorized or prepared such sale notices. Accordingly, the Company does not know the source of such notices." In other words, it does not dispute that the Ping Yi Mine is for sale.
4. The only issue regarding the difference in addresses is that the owner refers to the older address of Ping Yi Mine (we will address below).
5. We note that outside of a possible typo or human error regarding the Mining Permit number, there are no discrepancies in our argument about the ownership of Ping Yi Mine.

We stand by our conclusion that LLEN does not and never did own the Ping Yi Mine. Investors who do not embrace this conclusion are grasping for strings and playing a dangerous game.

For more detail on the mining permit and issue about the address, please read the following explanation:

In this detailed sales post, the sale representative posted the map of Ping Yi Mine, the business license of Ping Yi Mine and the Mining Permit of the Ping Yi Mine (http://www.worldmr.net/Exhibition/ForeCastList/Info/2011-10-11/112458.shtml). The Mining Permit is as follows:

The first paragraph of the introduction of the Ping Yi Mine in the same sales post states:

Translated into English:

"Pingguan Ping yi Mine locates at Sandaogou, Pinguan town, Pan County. It is around 10 km away from Pingguan and there is a low level paved road links Pingguan to the Mine. It is around 25 km away from Hongguo twon and the transportation is very convenient. Based on the mine map in the mining permit issued by Natural Resource Bureau of Guizhou province (No. 5200000711358), eight coordinates defines the scale of the mine with the 2.2694 m2 and the exploration depth is 2250-2210 m."

Apparently, there are two discrepancies between the web sales posting of the Ping Yi Mine and the posted business license and mining permit of Ping Yi Mine.

"Sandaogou Pingguan Town" vs. "Yiche village, Pingguan Town" in the Business License

"No. 5200000711358" vs.

In the SAIC file, there is a corporate change page as follows:

This corporate change clearly explained that the Ping Yi Mine moved from Sandaogou to the current address, Yiche village. It is reasonable to believe that when the owners wrote the sale posting, they made a mistake and used the old address on the sale post.

When the owners wrote the sale posting, they used the Mining Permit number "No. 5200000711358", rather than the , which Ping Yi Mine obtained on Aug. 2008 and is disclosed in the official mining permit in the same sale posting. There are several reasons for this mistake:

1. A typo
2. Before Aug. 2008, Ping Yi Mine had another Mining Permit, which may have carried the number "No. 5200000711358".

This does not debunk our finding that LLEN does not own Ping Yi Mine, which is clearly shown in the SAIC file.

Recordings and Transcripts Provide Conclusive Proof that L & L Int (LLEN) Never Purchased the Ping Yi Mine

Over the past few days, we have presented indisputable evidence that L&L Energy (LLEN: NASDAQ) has materially misled its investors and the SEC. For two years now, LLEN has unambiguously claimed to be a 100% owner of the Ping Yi mine, which allegedly provides almost 40% of its claimed capacity. As we explained in

our full report

After the report, some investors have stated that the SAIC file we pulled on Jan 13, 2012 showing that LLEN does not own the Ping Yi Mine is not the most up to date SAIC filing. They have also disputed what the sales agent of the mine, Mr. Wu, said.

We will now present the most compelling piece of evidence that we have, the recordings and transcripts. The conversations that you are about to read will make it crystal clear what actually happened in this story and that LLEN does not own the Ping Yi Mine.

The first conversation is a new conversation with Mr. Zhao Weijun (赵维君), the vice director of Company Registry of Guizhou SAIC Office on Jan 19. 2012 (Beijing Time). Mr. Zhao Weijun clearly explained what the examination date (核准日期) means and confirmed that there shall be no corporate change after the examination date shown on the SAIC file.

• Jan 19, 2012 Conversation with Mr. Zhao Weijun, Vice Director of the Guizhou SAIC office, proving we have the most current SAIC filing - Full Recording and Transcript

On multiple occasions in December, 2011 and January 2012, we contacted the sales representative for the Ping Yi Mine, Mr. Wu. Mr. Wu confirmed that the mine was up for sale by an investment group (four individuals) with no discernible ties to LLEN. When we asked him whether LLEN owned the mine, he answered an insistent no, and doubted that LLEN was even financially strong enough to make such an acquisition. He also told us that LLEN had discussed an acquisition in 2009, but no deal had happened.

We recorded two conversations with Mr. Wu, sales representative of the Ping Yi Mine on Jan 11, 2012 and Jan 16, 2012: The first one is a conversation prior to our first alert on Jan 13, 2012 and the second one is after our alert.

1. Jan 11, 2012 Conversation with Mr. Wu, confirming LLEN does not own the Ping Yi Mine Full Recording and Transcript
2. Jan 16, 2012 Conversation with Mr. Wu, confirming again that LLEN does not own the Ping Yi Mine Full Recording and Transcript
   
   Conversation with Mr. Zhao Weijun regarding the different dates on the SAIC file.

Background:

There is a confusion regarding the date on the SAIC file below.

 There is a date of Aug. 20, 2008 as the examination date (核准日期) on the file we pulled on Jan 13, 2012. Some people regard that the file we pulled only explain the legal status of Ping Yi Mine up to Aug. 20, 2008. We already explained this issue as follows:

To clarify this issue, we called Mr. Zhao Weijun (赵维君), the vice director of Company Registry of Guizhou SAIC Office, which is in charge of the company registration of Guizhou province, picked up our call and confirmed our explanation. The key points of the conversation between our investigator and Mr. Zhao Weijun (赵维君) is as follows:

Geo: Here it is. This company is established on Aug. 2, 2000. There is an examination date (核准日期) which is Aug. 20, 2008. At the bottom of the file, there is a date, which is Jan 13, 2012. I want to know, what does the examination date (核准日期) mean? (是这样的，这个企业的成立日期是2000年8月2日。上面有一个核准日期是2008年8月20日。然后这个文件最底下是2012年1月13日。我想问你一下，那个核准日期是什么意思？)

Mr. Zhao: Examination date (核准日期), for example, if the company comes to our office to do the corporate change, such as business scope, and we exanimate the corporate change, that day shall be the examination date. There is only one establishment date, which shall not change at all. (核准日期，比方说，它今年来变更，我们核准以后，比方说它变更经营范围，我们核准以后，这就是核准日期。如果说成立日期，它只有一个，它不会变的。)

Mr. Zhao: To the examination date, if the company changes one item, such as company name, registered capital, there shall be an examination date for each change. (核准日期，如果说它有变更事项，比如说变更名称，变更注册资本，每变更一次，就有核准日期。)

Geo: Now, the examination date (核准日期) of the company is Aug. 20, 2008. We can say there is no any corporate change from Aug. 20, 2008 to now, right? (那现在就是说，这个公司的核准日期是2008年8月20日，那就是说2008年8月20日到今天，它没有做任何变更，对吧？)

Geo: thank you very much. How can I call you? (谢谢。那您怎么称呼？)

Mr. Zhao: My last name is Zhao. (免贵姓赵)

Geo: Are you vice director, Mr. Zhao? (赵副局长，对吧？)

Mr. Zhao: Yes. (是的。)

Geo: thank you so much. Vice Director Zhao. (谢谢你，赵副局长。)

Two conversations with Mr. Wu, the sales agent of Ping Yi Mine

After the GeoTeam found the sales post of Ping Yi Mine at the beginning of Dec. 2011, we contacted Mr. Wu on Dec 12, 2011 to talk about the possible acquisition of the Ping Yi Mine. Our GEO investigator pretended to be from an investment company from Beijing China. In our first talk, Mr. Wu confirmed that Ping Yi Mine was still for sale.

After that, we periodically contacted Mr. Wu regarding the acquisition of Ping Yi Mine and confirmed with him several times that the Ping Yi Mine was not acquired by Fuyuan County Baoxing Economic & Trade Co. Step by Step, GEO told Mr. Wu that it was LLEN that told us that Ping Yi Mine was acquired by Fuyuan County Baoxing Economic & Trade Co. for the consideration of around USD 4 million at the end of 2009. Mr. Wu denied this claim by LLEN. To build trust, the Geoteam told Mr. Wu that a group of people led by Mr. Zheng (郑总) from Beijing may visit Ping Yi Mine before the Chinese New Year.

On Jan 11, 2012 (Wed.) (Beijing Time), GEO called Mr. Wu again and made an excuse that the group of people cannot visit Ping Yi Mine as there are not available air tickets before the Chinese New Year. We recorded this call and confirmed relevant issues surrounding the ownership of Ping Yi Mine again with Mr. Wu. The key part of the conversation is as follows:

[...]

Geo: then. We will try to visit you before the Lantern Festival (Feb. 5, 2012). Is it ok?

Mr. Wu: OK. OK.

GEO: Additionally, we contacted Longteng Mining (龙腾矿业，LLEN's Chinese name) again. They told us that Baoxing Economic & Trade CO., Ltd. paid you tens of millions in RMB, or USD 4 million to purchase the mine at the end of 2009 or beginning of 2010. Did you have this deal or not?

Mr. Wu: No. No.

GEO: No? No for this deal?

Mr. Wu: the deal failed at last （最后没成啊）.

GEO: this deal failed at last, right?

Mr. Wu: Yes.

GEO: Oh. They said that, at that time, Baoxing did pay around USD 4 million, or RMB more than 20 million amount. It is to say that that deal failed at last?

Mr. Wu: Yes.

GEO: Oh. They said that, at that time, Baoxing did pay around USD 4 milion, or RMB more than 20 million. It is to say that that deal failed at last?

Mr. Wu: Yes.

GEO: OK. We are not clear about their stance. Whatever, we just disregard this [LLEN's stance].

Mr. Wu: Yes.

[...]

After we released our initial alert on Jan 13, 2012, we knew that some investors may call Mr. Wu during the long holiday weekend and that LLEN may also contact Mr. Wu regarding this issue. On Jan 16, 2012 (Monday) GEO's investigator called Mr. Wu to once again confirm the relevant issues surrounding the ownership of Ping Yi Mine. Mr. Wu confirmed again that Ping Yi Mine is still owned by four individuals and LLEN did not acquire the mine. He also said that LLEN did contact them to acquire Ping Yi Mine but that deal never went through. Mr. Wu also told us that several guys called him during the weekend with "private numbers" or "oversea numbers". Furthermore, Mr. Wu did not mention whether LLEN contacted him or not after we release this press release. The key part of this conversation is as follows:

[...]

Mr. Wu: Now, our biggest boss is Mr. Zhang, Zhang Baoguo. The mine is owned by individuals. (我们最大的老板姓张，张保国。我们现在是私有的。)

GEO: What? （现在是什么？）

Mr. Wu: owned by individuals. At the beginning, LLEN (龙腾矿业) did discuss this deal with us. At last we did not reach a final deal. （私有的。最初，龙腾矿业谈是谈过，但是最终没成交易。）

GEO: Oh.

Mr. Wu: LLEN did not pay money to us at all. （他们也没有付钱。）

GEO: signed a contract but not pay any money? So the claimed agreement is a void contract?

Mr. Wu: Yes.

GEO: Oh. The agreement on the hand of my boss is a void contract?

Mr. Wu: Yes. Even mentioned something called like Baoxing Group. （还说那个什么宝兴集团）

GEO: Yes. Baoxing Economic & Trade Company. Therefore, my boss complained about Mr. Zhang a lot and said he did not do a good job. As this is a big issue, we also pulled the SAIC file of Ping Yi Mine. Based on the SAIC file, we realized that Ping Yi Mine is owned by four individuals as a partnership. (the voice is disturbed) Hello?

Mr. Wu: I am listening.

GEO: This is owned by four individuals as a partnership, not owned by LLEN, right?

Mr. Wu: Yes.

Mr. Wu: Yes. Now, it is owned by four individuals and it is not sold to any other. （是的。现在是四个自然人所有的，没有卖给任何人。）

GEO: Yes. I read the SAIC file and it says that it is owned by four individuals.（是的，我知道，我看了工商档案，是说四个自然人。）

Mr. Wu: No such a thing (acquisition by LLEN) at all. （没有这个事情）

GEO: no such a thing (acquisition by LLEN) at all, right? （根本没有这个事情，对不对？）

Mr. Wu: There was this thing. But, there is no reached deal. （有是有过，但是最后没有成交。）

GEO: We know. If the deal is not done, we know what we can do. Then, I can report to Mr. Zheng, my boss, to arrange the following things and possible trip. After our arrangement, I will give you a call. Is that ok?

Mr. Wu: You already know the information of the mine, right?

GEO: Yes. This is the only thing in doubt. Even though I am already on my vacation, my boss still asked me to call you to confirm this.

Mr. Wu: There are several guys that called me in these days to enquire about this issue. There was no phone number reflected on my cell phone. Sometime, it reflects "private phone number" or "oversea phone number". （这两天有好几个人打电话给我，来问这个事情。他那个号码没有来电显示，还有就是显示为私人号码或者海外号码。）

GEO: Oh. Really?

Mr. Wu: they all called me for this issue. I thought they were from your company. （他们打电话都是问这个事情，我还以为是你们公司的人。） [...]

See our full report

Disclosure: Short LLEN

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SEATTLE, Jan. 17, 2012 /PRNewswire/ -- L & L Energy, Inc. (Nasdaq: LLEN) ("L&L" or the "Company"), a U.S. based company since 1995 with coal mining and distribution businesses in southwest China, announced today it is concentrating greater efforts in the Guizhou Province, specifically, on new acquisitions that will focus on larger mines, as well as newer mines that meet anticipated enhanced safety and mechanization regulations .  The Company will also explore geographical diversification from southwestern China by looking at new coal resources in other provinces.

L&L recently signed two joint sales/marketing agreements with two giants; China Chengtong Metals Co. and Tianjin Fuhao Industrial Co. Ltd to expand its wholesale operation in addition to its existing sales operations in South China. If fully executed, the agreements collectively will generate approximately $US 300 million in revenues throughout 2012.

L&L also recently added Mr. Jingcai Yang as an advisor. He is a former senior executive from China Shenhua Group Corporation Limited, the world largest coal producer and will assist the Company to explore coal sales on a national level. As an executive who ran one of the largest surface mines in the world, Mr. Yang will also help the Company evaluate potential surface mines, which have experienced fewer disruptions than underground mines.

The Company also recently signed an MOU with three newly built mines Guizhou and is in active negotiations to acquire all three.

Dr. Syd Peng commented, "What I learned from my recent extensive visit to inspect potential mine acquisitions is that the Company should take advantage of the new availability of larger mines with stronger management teams as well as some new mines that meet anticipated enhanced safety and mechanization regulations." 

Dickson Lee, Chairman and CEO added, "As a company with 16 years of experience in China we have consistently sought to take our operations to the next level. Our partnerships with companies of CCMC and Tianjin Fuhao's caliber have exposed us to many new opportunities. We believe our vision and hard work have helped us to navigate this somewhat turbulent past year and we are positioning ourselves to bring solid results to our shareholders."

SEATTLE, Jan. 17, 2012 /PRNewswire/ -- L & L Energy, Inc. (Nasdaq: LLEN) ("L&L" or the "Company"), a U.S. based company since 1995 with coal mining and distribution businesses in southwest China, announced today it reaffirms its ownership in Ping Yi Mine ("Ping Yi") and states it has not posted Ping Yi for sale.  

A GeoInvesting blog/article recently cites three questions, regarding ownership of Ping Yi, availability of Ping Yi for sale, and coal production at DaPuAn Mine ("DaPuAn").

Regarding ownership, the Company reaffirms its ownership rights in Ping Yi Mine.  As the Company has disclosed in its most recent 10-K, "effective November 1, 2009, KMC (a wholly owned subsidiary of L&L) through its subsidiary Baoxing Co., entered into an agreement to acquire 100% of Ping Yi mine operations."  The disclosure is consistent with both legal opinion (issued by a large and reputable law firm in China) and audit opinion (issued by an independent auditing firm after its FY 2011 year-end audit on the Company.) 

Ed Moy, L&L Board Director and Vice President commented, "Last April, I led investors on a tour of our operations in Yunnan and Guizhou Provinces of China, which included a visit to Ping Yi Mine.  Investors had a chance to meet and talk with our staff and local mine management. I can therefore confirm our ownership of Ping Yi Mine."

Regarding the sale notices mentioned by GeoInvesting in its article, the Company never authorized or prepared such sale notices.  Accordingly, the Company does not know the source of such notices.

As stated in the Company's last quarterly report, an accident that happened at a mine not owned by L&L (located a few miles from DaPuAn) had caused DaPuAn to be temporarily idled.  The Company is currently working with the local government to reach full production.  However, due to the way local governments and agencies operate, it is often extremely difficult to predict the overall impact of any governmentally initiated interruption on coal production.  Therefore, as already stated in our most recent 10-Q, "we believe that the Company will continue to experience periodic to frequent idling or production slowdowns until the consolidation process reaches critical mass and closes down small or high risk mines that were not acquired by a consolidator."

Dickson Lee, Chairman and CEO of L&L further commented, "L&L made an officer available to GeoInvesting for interview and also offered to answer GeoInvesting's questions directed to me in writing.  But GeoInvesting refused and insisted on speaking with me personally, at a time when I have been traveling extensively in Asia and frequently in very remote mining areas."

Given that GeoInvesting has made publication without proper verification, the Company with due respect, does not plan to respond to any of GeoInvesting's future publications. 

We are offering conclusive proof that L & L International LLEN does not own the Ping Yi Mine:

• We offer evidence that undoubtedly proves that LLEN did not purchase the Ping Yi Mine as it has been repeatedly asserted in SEC filings.
• We offer evidence that undoubtedly proves that the Ping Yi Mine is for sale by an investment group with no discernible ties to LLEN.
• We reference multiple data points across several official Chinese and SEC filings that precisely match information on the SAIC filing we have pulled. We argue this identical match is conclusive proof that we have not misidentified the Ping Yi Mine.
• One of our pieces of evidence includes an official government document published in a public news periodical that supports our conclusion that LLEN does not own the Ping Yi Mine.
• We spoke to the person representing the investment group selling the Ping Yi mine who repeatedly denies that LLEN ever purchased the mine.
• Directly check the current basic information regarding the Ping Yi Mine yourself with only a click. The investor can directly go to the Guizhou Province SAIC Office http://old.gzaic.org.cn/service/index_qyinfo.html to check the current status of the Ping Yi Mine. After typing the full name of Ping Yi Mine and security code, you can see that the current legal representative is Mr. Hu Shiwei, who is not affiliated with LLEN, and the current business license number is 5200002932260.

As previously stated in our original report, and even more so after further due diligence, we believe that LLEN shares are not investable and pose an extreme risk to long investors.　

We also take note of LLEN's two press releases this morning:

In the face of on the record, detailed accusations from researchers responsible for discovering a series of massive governance frauds at the like of YUII and PUDA, a press release promising a looming 25% revenue increase via expanded sales and marketing joint agreements should be seen as an attempt to distract investors from the grave matters at hand.

Similarly, as we continue to demonstrate, there is a large amount of conclusive documentary evidence from official sources that LLEN utterly ignores. Instead, its management appears unconcerned that someone is advertising one of their key assets for sale. In sum, we are being asked to trust their legal team and Auditor, Kabani and Co, a firm that has been involved in many of the most dubious reverse merger audits. We respectfully decline to give them our trust.

These evasions and tactics should be abundantly familiar to the burned investors of dozens of Chinese reverse mergers and bodes ill for the value of their capital.

Any long or short LLEN investor should read every page of the following report thoroughly.

See all the evidence! (and comment on slide share)

Disclosure: Short LLEN

Sincerely,

The GeoTeam

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January 13, 2012

In recent months, things have been pretty bad for Chinese coal company L&L Energy (LLEN). There have been public allegations of fraud, mine shutdowns and falling profits. The only bright spot has been the company�s valuation, which has stayed quite high relative to the rest of the China RTO sector (~$100 million market cap). As bad as things seem for LLEN, it could get much worse. That�s because the GeoTeam recently uncovered evidence that appears to indicate that LLEN does not own and never acquired the Ping Yi Mine. LLEN claims in its SEC filings that it acquired the Ping Yi Mine in January of 2010 and that the mine contributed close to 40% of the company�s total coal production for the financial year ended on April 30, 2011.

• The SAIC file of the Ping Yi Mine shows that the Ping Yi Mine is currently held by a private investment group, rather than the LLEN subsidiary, Fuyuan County Baoxing Economic & Trade Co., Ltd., the company identified as the acquirer of the mine in SEC disclosures.
  
• In a truly mind-blowing development, this investment group has put the Ping Yi mine up for sale during the second half of 2011. There are multiple readily navigable web links in China that address the sale of the mine:
   
  • China Mining Industry Consulting Network, (see also, English translated page)
  • Global Mineral Resources Network, (see also, English translated page)
  • My Coal Network, (see also, English translated page)
    

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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 compared to $0.35 in the 2011 Second quarter

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."

Need to raise capital has has become more explicit:

We will need to raise additional capital to expand our operations, both to fund additional investments in capital equipment and technology to increase production and improve safety at existing facilities and to acquire additional profit making operations.

SEATTLE, Dec. 5, 2011 /PRNewswire/ -- L & L Energy, Inc. (Nasdaq: LLEN) ("L&L" or the "Company"), a U.S. based company since 1995 with coal mining and distribution businesses in southwest China, announced today that its subsidiary has entered into a long term joint sales agreement with China Chengtong Metal Corporation ("CCMC") to jointly market/sell one million tons of coal in China during calendar 2012, starting in February.

DaXing- L&L (Guizhou) Coal Inc., a new L&L wholly owned coal subsidiary based at L&L's Hong Gou office, entered the joint sales agreement with China Chengtong Metal Tianjin Company, a wholly owned subsidiary of CCMC, a large China state owned enterprise specializing in coal and metal trading throughout the north China and inner Mongolia markets. The Tianjin company is a market oriented sales unit with strong existing coal customers and recently demonstrated substantial sales growth. The joint sales agreement will synergize both company's resources, sales network, and share geological market information forming an integrated coal supply chain to service additional customers in the growing China coal market.

The parties will work collaboratively to source and sell/market one million tons of coal (both coking and thermal coal), in calendar 2012. The sales agreement will generate approximately $150 million in revenues if fully executed, using a $150 per ton coal price. 

SEATTLE, Sept. 21, 2011 /PRNewswire/ -- L & L Energy, Inc., (Nasdaq: LLEN) ("L&L" or the "Company"), a U.S.-based company since 1995 with coal mining and distribution businesses in China, announced that LLEN shareholders re-elected all seven directors with over 98% of the vote during the September 15th Annual Shareholders Meeting.

During the meeting Dickson Lee, Chairman and CEO, gave an in depth presentation on the tremendous growth opportunities that L&L will be focusing on in the Guizhou Province. Highlights from Mr. Lee's remarks included:

• Details regarding L&L's meeting with Guizhou's Vice Governor and Energy Bureau Chief where L&L received an endorsement to take a leadership role in the consolidation process.
• 1,600 locally owned mines currently operating in the Guizhou Province will be reduced to 200 or less under the outlined plan.
• L&L is the only American owned and US publicly listed company in Guizhou, which is unique from the government's perspective.
• L&L is working with one a large local commercial bank that may assist with financing.
• L&L signed letters of intent with owners of 14 locally operated mines in the Guizhou Province who are willing to be acquired by L&L, subject to further due diligence.

Dr. Syd Peng, L&L Director and world renowned mining expert from the US, commented on his planned visit to Guizhou, saying "I am eager to get on the ground and help L&L target quality acquisitions. We will evaluate each mine's geology and mining operations, emphasizing safety and mechanization. Our goal is to apply a US level of standards to China, which will bring long term benefit to the Company and its shareholders.

LLEN was more direct in its Fiscal 2011 first quarter that it will need to raise capital to implement its growth plans, but less specific than other filings in the tools it will utilize to raise capital:

Fiscal 2012 first quarter

We will need to raise additional capital to expand our operations, both to fund additional investments in capital equipment and technology to increase production and improve safety at existing facilities and to acquire additional profit making operations.

Fiscal 2011 10K

Management presently believes that cash flow from operations and increasing access to credit will provide the company sufficient capital resources for the infrastructure, mechanization, and safety elements of its business strategy. To implement its acquisition strategy, in conjunction with the government mandated consolidation of mines, the Company may consider the issuance of additional debt or equity securities. In addition to potential externally raised funds, the Company intends to utilize a combination of existing cash on hand, cash flow from operations, and seller paper to finance the acquisition of mines.

First Quarter 2012 Results

Results of Operations

Fiscal 2012 First Quarter Summary and Recent Highlights

• Accelerated Guizhou Provincial Consolidation policy creates tremendous growth opportunity for L&L
• 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
• L&L signs letters of intent with 14 operating Guizhou mines that collectively produce approximately 3 million tons per year
• L&L enters into a Memorandum of Understanding with Tianjin Fuhao, a fully-owned subsidiary of Tianjin Materials and Equipment Co., and a leader in coal logistics and infrastructure in China
• Revenues and earnings were negatively affected during the last quarter and this quarter due to temporary idling of all company-owned mines. In accordance with the provincial-wide mandate, approximately 1600 mines in Guizhou were temporarily idled. Three of four L&L mines are now back in operation
• Revenues for the first quarter were approximately $36.7 million
• Net income was $3.08 million
• Earnings per share was $0.08 per diluted share
• Operating profit was $4.24 million
• Gross profit was $8.19 million

In this quarter our net revenues decreased to $36.7 million during the three months ended July 31, 2011, down from $55 million during the same period the year before. The decrease was primarily due to the government's temporary slowdown and idling of all mines in our region, coupled with the cyclical low summer season.

The idling of mines and regional shut downs had negative effects across all segments of our business. Revenues from mining operations for the first quarter were $7.3 million. Our washing and wholesale segments were affected by the lack of coal. Revenues from coal washing decreased over the first quarter to $18.98 million and revenues from wholesale operations decreased to $4.46 million. The volume of sales dropped due to decreased supplies of raw coal and fine coal in Yunnan and Guizhou. Coking was also negatively affected, with revenues for the first quarter being $6.64 million.

Our gross profit was margin was reduced to 22%. Mining, which typically has had the highest margin, was impacted most by the idling. Secondly the vast majority of our work force stayed on payroll and spent significant time implementing upgrades to meet increasing safety and regulatory standards.

"Our earnings and revenues were affected across all segments of our business by the idling of our mines during mandatory, but temporary closures and slowdowns issued by the local government," said Ian Robinson, Chief Financial Officer of L&L. "The negative effect on our numbers are temporary and we support the government's stance on increasing accountability and safety in our industry. We continue to work with the local provincial governments to take the lead in increasing the standards of not only safety, but also operational efficiency. We expect that the government will play a major role in supporting consolidation efforts and we look forward to working with them to ensure safe and efficient operations within the region."

Dickson Lee, Chairman and CEO stated, "Continued negative perception on companies who operate in China has slowed our growth plans. However we continue to improve our foothold in the coal industry and have been able to make tremendous strides in positioning ourselves at the forefront of a number of opportunities in South China. We are focused and confident in our position to take a leadership role in the Guizhou coal consolidation process and with the support of the local government, we have been able to sign letters of intent with 14 potential mines that collectively could yield US$500 million in revenues. The next step will be to have Dr. Syd Peng, an L&L Board Member and world-renowned coal expert, lead our acquisition team on a trip through Guizhou to evaluate each potential acquisition.  Dr. Peng is a recognized expert in underground mining in both the U.S. and China and will be able to assist our very strong mining and acquisition team in China to evaluate each mines' management team and mining operations, including mechanization potential, safety, and production expansion capabilities."

Lee continued, "The potential in Guizhou is huge, and going forward I expect we will expend a tremendous percentage of our resources on this potentially game-changing opportunity."

The government took action and issued the provincial-wide temporary closure due to several fatal mine accidents (our mines had no accidents) in South China during the spring. Our Yunnan mines have resumed production, although are undergoing improvements in accordance with the recent regulatory changes. Our Da Ping mine has been approved to resume production and is currently expanding its production capacity. However, our Ping Yi mine remains idle as of July 31, 2011.

SEATTLE, Sept. 6, 2011 /PRNewswire/ -- L & L Energy, Inc., (Nasdaq: LLEN) ("L&L" or the "Company"), a U.S.-based company since 1995 with coal mining and distribution businesses in China, announced that it has signed Letters of Intent with 14 operating coal mines in the Guizhou Province. The mines produce primarily coking coal and have been collectively approved for 3 million tons of annual coal capacity. If executed, based on current market prices, it would yield approx. US$ 500 million in revenue.

In an effort to increase mine size and improve production efficiency, the Guizhou Province recently announced a plan to reduce its 1,600 locally owned mines to some 40 holding companies. The government also mandates that total coal production in the province be increased by a 40%, equating to 300 million tons per year by 2015. L&L's acquisition team has been working hard at the forefront in the consolidation process, which could result in exponential revenue growth. L&L is the only American owned, and U.S. public listed mining company in the province with strong U.S. management skills, and 16 years of in-China experience. The Company is working with Asian and local sources to finance the acquisitions.

Dickson Lee, Chairman and CEO of L&L Energy commented, "Guizhou's accelerated consolidation plan provides an enormous profit opportunity. In my recent meetings with Vice Governor of Guizhou and the Chief of the Energy Bureau, we were encouraged to target 5 million tons of capacity and to take a leadership position in the Guizhou consolidation process. With our deep relationships in the region and our success of bringing U.S. operating standards to China, I am confident in our position moving forward. A U.S. technical team, led by L&L board member Dr. Syd Peng, will head to China in September to supervise the acquisitions. Based on the team's assessments of geology, staffing and consultation of local agencies, we will execute appropriate mines in our first round of acquisitions."

SEATTLE, Aug. 29, 2011 /PRNewswire/ -- L & L Energy, Inc. (Nasdaq: LLEN) ("L&L" or the "Company"), a U.S. based company since 1995 with coal mining and distribution businesses in China, today announced that the Company's Chairman and CEO, Dickson Lee, has converted $420,000 of his prior loan to the Company into LLEN common stock at $8.50 per share.  The closing price of LLEN common stock on Friday, August 26th was $3.42. The loan was made in early 2011 to support the funding of Bowie mine. 

Mr. Clayton Fong, Executive Vice President of L&L commented, "Mr. Lee's conversion of his personal loan into LLEN shares at $8.50 has received endorsement from the Company's Board Directors. The large conversion premium displays Mr. Lee's confidence in the company.  I share his belief that LLEN's current market capitalization does not reflect the value of our operations, and it substantially discounts the tremendous growth opportunities in Guizhou Province's coal consolidation."

Fiscal Year 2011 Financial Results

• Revenues generated in fiscal year 2011 increased to approximately $224 million up from $109 million, in 2010.
• Income from continued operations for fiscal year 2011 increased to approximately $37 million compared to $31 million in 2010.
• Fully diluted earnings per share from continued operations for fiscal year 2011 were approximately $1.21 vs $1.28 in 2010

Dickson Lee, Chairman CEO of L & L, commented: "I am pleased to report that our revenues experienced strong growth, primarily attributable to the execution of our organic expansion plans. In April of 2011, the last month of the fourth quarter, we cooperated with local authorities to slow down mining production to enforce safety standards, which was the primary reason we missed our guidance on net income for this fiscal year. Our results for this fiscal year continue to illustrate our ability to increase the production capacity of our existing operations, conduct accretive acquisitions, such as the DaPing mine, as well as our flexibility to work under increasing government safety requests."

Lee also commented," As the Guizhou coal mining consolidation has started in April, L & L is ready to take on these opportunities and challenges to demonstrate our leadership and prowess in becoming a leader in the China coal industry."

L & L Energy, Inc. (“L&L” or the “Company”) is filing this Amendment to Form 10-K (this “Form 10-K/A”) to amend that Form 10-K filed on July 28, 2010 corresponding to the annual report for the Company’s fiscal year ended on April 30, 2010 (the “Original 10-K”).  This Form 10-K/A amends the Original 10-K’s Part II, Items 6 and 8 to:

(i)                  (a) reclassify $3,729,784 recorded as “Intangible assets, net” in the Original 10-K as “Property, plant, equipment, and mine development, net” in this Form 10-K/A, (b) reclassify 557,202 recorded as “Current Assets – Prepaid and other current assets” in the Original 10-K as “Equity – Deferred stock compensation,” and (c) make conforming changes to “Working Capital,” “Total assets” and Total Shareholders” Equity under Item 6 – Selected Financial Date – Balance Sheets Data,”; and

(ii)                file herewith two updated reports issued by Kabani & Co. Inc., the Company’s independent auditing firm (the “Independent Auditing Firm”) to disclose the firm’s adverse opinion on the Company’s internal control over financial reporting as of April 30, 2010 (originally the Independent Auditing Firm issued a “disclaimer” opinion on the Company’s internal control over financial reporting).

Please note that some of the aforementioned reclassifications, adjustments, and additional disclosures contained herein have resulted from comments issued by the Securities and Exchange Commission of the United States (the “SEC”) during the review process related to filings made by the Company.  .  For clarification, the filing of this Form 10-K/A shall not be deemed any indication that the original Form 10-K, when filed, included any untrue statement of a material fact or omitted to state a material fact necessary to make a statement therein not misleading.

SEATTLE, July 1, 2011 /PRNewswire/ -- L & L Energy, Inc., (Nasdaq: LLEN) ("L&L" or the "Company"), a U.S.-based company since 1995 with coal mining and distribution businesses in China, announced today that Ian Robinson, CPA, will join the Company as Chief Financial Officer, effective June 30, 2011.

SEATTLE, May 23, 2011 /PRNewswire/ -- L & L Energy, Inc.,  announced today the formation of Yunnan L&L Tai Fung Coal Co. Ltd. ("Tai Fung") in the Yunnan province of China.

SEATTLE, March 28, 2011 /PRNewswire/ -- L & L Energy, Inc. announced that it has entered into a contract to acquire a majority controlling interest (60%) of the DaPing coal mine. The acquisition became effective on March 15, 2011.

The DaPing mine is located in PanXian, Guizhou Province in China. The mine currently produces approximately 150,000 tons of high-quality, low-sulfur metallurgical coal per year and is expanding to 300,000 tons of production capacity, which is expected to be completed in 2012. The Mine is expected to generate an estimated $36 million in annual revenue based on current production capacity and an average coal price of $240 per ton. The Mine is expected to contribute an estimated $11 million in net income attributable to L&L for the fiscal year ending April 30, 2012.

SEATTLE, March 15, 2011 /PRNewswire/ -- L & L Energy, Inc., today announced financial results for its FY Q3 2011 ended January 31, 2011.

• Revenues for the FY Q3 2011 were $65.9 million, an increase of 74% from the $38.0 million reported in the same quarter last year. Sales growth was driven by sustained demand for coal as well as price increases.
• Gross profit grew 33% to $21.4 million, compared to $16 million for FY Q3 2010. Gross margin declined slightly sequentially to 32.5% as compared with 33.5% in the prior quarter and reflects increased levels of coal washing at the expanded Hong Xingwashing facility.
• Operating expense remained steady at nearly $4.9 million. Operating margin increased to 77% from 75%, reflecting the increased sales level.
• Operating income grew 26% to $16.5 million as compared to $13 million in FY Q3 2010. Earnings per share of $0.41 grew 21% as compared to $0.34 in FY Q3 2010.

"Demand for coal in our operating region of Southwest China remains robust," said Dickson Lee, Chairman and CEO of L&L. "We are encouraged by our strong results, our partnership with Bowie Resources in Colorado, and ongoing discussions with the Zhanjiang Port in China. We anticipate sustained demand for our fiscal fourth quarter, driven by ongoing overall economic growth."

Dear Fellow Shareholders,

I am pleased to report to you on our progress and recap our accomplishments during 2010. This has been a year of growth and advancement for L&L Energy, and I want to begin by thanking all of you for your support as we continue to strive to become a world-class coal provider with a global footprint.

We kicked off the 2010 calendar year by changing our name from L&L International Holdings to L&L Energy, a strategic decision that symbolized our focus on penetrating the opportunities in China's energy market, specifically coal mining and distribution. The following month, we received approval to begin trading on the Nasdaq Global Market exchange, which provided a significant boost to our volume and visibility.

Our rapid operational growth and growing reputation have also engendered wide recognition for L&L since our initial Nasdaq uplisting. In June, our stock was added to the Russell 3000 Index, giving us greater institutional exposure due to the index's wide acceptance as a market benchmark. In October, we were added to the Halter USX China Index, a popular benchmark of U.S.-listed Chinese companies. Lastly, we announced just a few weeks ago that our stock will move to the Nasdaq Global Select, which has the highest initial listing standards of any exchange in the world based on market value and financial requirements. Each of these accomplishments is its own confirmation of the progress we've made in developing our business in 2010.

From a financial perspective, this year has been successful. Our 2010 fiscal year, which ended in April, yielded record results including 167% year-over-year revenue growth and 230% net income growth. We are on track for another record year financially in fiscal 2011; in fact, our revenues of roughly $113 million in the first two quarters already exceed our total sales for fiscal 2010.

Commitment to Safety and Quality

Since our inception, safety and regulatory compliance both in China and in the U.S. have always been two of our chief concerns, and in 2010 we have made a number of decisions, some difficult, to uphold our commitment to excellence in these areas. While our mines have an exemplary safety record, we recognize the inherent risks and the safety problems that have plagued the industry in China for years. In May, we publicly reaffirmed our pledge to constantly improve the safety practices of our own mines and, by introducing higher U.S. standards in our acquired operations, to serve as a model for other mine operators to adopt and improve upon.

Our commitment to safety was tested in a very tangible way this year as we evaluated the potential acquisition of Shunda Mining Co. The transaction appeared promising and would have substantially increased our mining and washing capacity. However, after completing due diligence we determined that we would have been unable to satisfy our internal standards with this acquisition and withdrew from negotiations. While we sacrificed significant revenues and profit in the short-run by forgoing the acquisition, our management team believed that the decision was in the best interests of our investors. Moving forward, however, we are actively seeking out other acquisition targets of similar size that could increase our production capabilities and profitability, and we are currently evaluating several attractive options.

Addition of Top Talent

We are dedicated to building and retaining a management team of the highest caliber. We are excited about the new directors and senior executives we've brought on this year, beginning with our operational director Dr. Shen-Lin Chang, who has over 30 years of industry experience and oversees our daily operations in China. In August, we were very excited to add former U.S. Secretary of Commerce and Secretary of Transportation Norman Mineta to our board of directors. Mr. Mineta, who now serves as vice-chairman of the board, brings a wealth of experience, insight, and established relationships in both the public and private sectors to L&L, and we have greatly appreciated his contribution these past few months.

As we build our business, we understand the importance of continually expanding all aspects of our organization. Finances and financial controls are a very big piece of any public company, and given our substantial growth, we have needed to continually build out this department. Our Director of Accounting for China Operations David Lin, CPA who has worked for several Big Four accounting firms including Arthur Andersen, KPMG, and Deloitte, and our Chief Accounting Officer Paul Cheng have both joined L&L recently and will be very valuable members of our team. We also anticipate further expansion of our financial staff as we continue to grow.

Most recently, Edmund C. Moy has joined the Company as Vice President of Corporate Infrastructure. Mr. Moy's appointment will be effective January 10, 2011, and his key areas of responsibility will include corporate development, global logistics, and general administration. Mr. Moy joins us from the United States Mint, where he has served as 38th Director of the Mint since 2006. In this capacity, Ed oversaw over 2,000 employees and we look forward to the perspective and experience he will bring to our team.

Growth & Acquisitions

Our dramatic growth over the past year has been a combination of both acquisitions and organic expansion. In the second half of last fiscal year, we completed a number of substantial acquisitions of mining assets; coal washing facilities and coking facilities. Post-acquisition, we spent the next several months integrating and improving these businesses from an operating and financial perspective. During this time, we took the opportunity to rapidly expand the production of these operations, which significantly added to the value of our business. We also utilized our cash flow from operations to build a new coal washing facility that enabled us to further vertically integrate our company for future growth.

This expansion of capacity in our coal washing business has allowed us to focus largely on acquiring and expanding coal mining assets in the coming year, as opposed to washing or coking. Coal mining is the core focus of our business and generates substantially higher margins for our investors. Also, we have found that, post-acquisition, we are able to organically expand coal mining assets to a much greater degree by utilizing Westernized management and mining philosophies. Thanks to our established resources and infrastructure, as well as the due diligence experience we gained in analyzing Shunda, we are able to target significantly larger mining acquisitions in terms of production, revenue and profitability this year than we did a year ago.

In a strategic first step, we recently provided a $3 million loan to Bowie Resources, which owns and operates the Bowie coal mine in Colorado, with the option to acquire a 9% equity interest in the company. We see this as an excellent opportunity to acquire a portion of a high-quality, U.S.-based coal mining operation with an experienced management team at an attractive price. Our efforts in North America are 100% focused on expanding our business globally. We want to be able to secure supplies in the U.S. through loans, acquisitions, and partnerships to export the coal to China. If we can source very good coal from the U.S., ship it to China, and then blend in coal from our Chinese operations while still keeping the quality of our coal well above the relevant standards, we will be able to provide strong returns for both our investors and our U.S. partners.

2011 Market Outlook

We believe the Chinese coal market will remain robust in 2011. We operate in South Central China, which has a great need for both met coal and thermal coal, between which our business is appropriately balanced. We very much like operating in the South due to the relatively less competitive environment compared to in the North, as well as the fact that transportation of coal in China is substantially easier in the South. Central China is significantly less developed than the coastal regions, and we believe the area will experience a substantial expansion of infrastructure, as well as a growing need for energy, for many years to come. We are currently seeing very attractive coal pricing for both products as well. As China becomes more internally developed and continues to expand its GDP, we believe this will further stabilize the local and national economy as well as increase the need for coal.  

As we look toward the coming year, we are optimistic regarding our prospects. Over the next few years, we believe we will become a significantly larger and stronger company driven by both the continued global demand for coal and the drive and passion of our managers. Thank you for your continuing support, and happy New Year!

Sincerely,

Dickson Lee

Chairman & CEO, L&L Energy, Inc.

Fiscal 2010 Second Quarter

• Total revenue jumped from $24.5 million to $57.4 million compare to last year, approximately 135% growth.
  
  
  • This is due to our acquisition decision.
  • During the three months ended October 31, 2010, our coal mining net sale decreased by $436,423, approximately 4% decrease compared to the three months ended October 31, 2009. This sales decrease was mainly due to increase in intersegment sales from Ping Yi mine to its washing facility.
  • Total intersegment sale was $6.6 million, which was eliminated from our mining revenue.
  • Coal wholesale went up by 48% due to higher coal price and increase volume this year.
  • Coal washing revenue went up sharply in 2010 because we acquired HongXing Coal Washing Facility and established of Ping Yi Coal Washing Plant.
  • Coal Coking revenue increase because we acquired ZoneLin Coal coking facility in 2010 with production capacity of 150,000 tons annually.
     
• Our gross margin went down from 52% to 34% for the period due to two factors. First, expansion into washing and coking are lower margin businesses, but vertical integration increases the overall value of the business and adds stability to the supply chain. Second, expansion of capacity and increases in safety standards on new acquisitions require up front investments.

• Net income attributable to Common shareholders was $11,060,858 vs. $6,946,781.

• Fully diluted EPS was $0.35 vs. $0.29.

L&L Energy Announces Preliminary Second Quarter Fiscal Year 2011 Financial Results 

• Record Revenue of $57.4 million in Q2 Increased 135% Year-over-Year and 3.8% Quarter-over-Quarter
• Gross Profit of $19.2 million increased 135% Year-over-Year and 3.8% Quarter-over-Quarter
• Record Net Income of $12.7 million
• Earnings per Share of $0.35 increased 21% Year-over-Year
• Doubled Production for two Acquired Mines to 300,000 Tons
• Company Entered into Agreement to Provide Loan to High Quality U.S.-Based Bowie Coal Mine

"We are very pleased with our continued strong performance in the second quarter," said Dickson Lee, Chairman and CEO of L&L. "Our continued focus on the improvement of our acquired operations has enabled us to more than double revenue compared to last year's quarter. Additionally, our agreement to provide bridge financing to the Bowie Mine is an exciting first step that extends the company onto the global stage. 

2011 Fiscal First Quarter:

• Shunda Mining Company acquisition is taken off the table.  During the LLEN's due diligence process, management spotted safety record issues that would have increased business risk.
  
• Assured investors that the company is evaluating additional accretive acquisition targets that could help exceed financial guidance; Believes a transaction will be consummated before the end of 2010.
  
• Reaffirmed that company guidance does not include acquisitions.   
  
• Addressed sequential decline in gross margins: The company continues to diversify its business and reduce overall business risk. Part of this strategy includes ramping up its coal washing business which carries less margin than direct mining operations.  Management also noted that the company has made some investments that may benefit margins going forward.
  
• Vertical integration strategy and emphasis on being a service provider gives it pricing power.
  
• Financing goals: Appears that the company will use debt over equity in the current market environment.
  
• L & L Energy has strengthened its internal control procedures.
  
  
  • Hired internal auditors and a CPA from Arthur Anderson.
  • Will continue to upgrade professional staff.
  • Contemplating retention of a new auditor.

L & L Energy reported preliminary results for its fiscal 2011 first quarter:

• Revenues for the first quarter increased approximately 336% to $55.3 million, compared with revenues of $12.7 million in the same period a year ago.
  
• Gross profit for the first quarter increased to $18.6 million, up approximately 207% compared with $6.1 millionin the same period a year ago.
  
• Net income increased approximately 306% year-over-year to $10.9 million, compared with $2.7 million in the same period a year ago.
  
• Earnings per share for the quarter totaled $0.36 per diluted share, an increase of approximately 177% compared with $0.13 in the same period a year ago.

"We are delighted to be able to announce such exceedingly positive preliminary results for our first quarter," commented Dickson Lee, Chairman and CEO of L&L. "We continue to experience the accretive effects of the four acquisitions we made last year, as well as the benefits of operational improvements at those facilities. China's government recently reiterated its commitment to consolidate the coal industry and support mergers and acquisitions of smaller mines, which form the crux of our strategic expansion. We look forward to sharing our full quarterly results with our shareholders shortly.  We expect strong continued growth for the rest of the year as we continue to execute our core businesses, integrate our recent acquisitions, and seek out new growth avenues."

GeoTeam note:

According to analysts estimates, LLEN has one more quarter left of above average EPS growth, before EPS growth is forecast to slow for a few quarters.

Source: Reuters

We have referenced this issue in the past. Please be aware that 2011 company EPS guidance of $1.61 is greater than analyst estimates.  Also keep in mind that LLEN goal is to pursue accretive acquisitions.

Fiscal Year 2010 Financial and Operating Highlights

(Pending Finalization of Audit)

Management believes that:

• Revenues generated in fiscal year 2010 increased to approximately $109 million, up from $41 million in 2009, representing a 166% increase.
• Operating income for fiscal year 2010 doubled to approximately $39 million, compared to $19 million in 2009
• Net income for fiscal year 2010 tripled to approximately $30 million, compared with $10 million in 2009
• Fully diluted earnings per share for fiscal year 2010 were approximately $1.17, up from 2009 EPS of $0.46.

Dickson Lee, Chairman and CEO of L & L, commented: "We are thrilled to report such dramatic growth in our fiscal year April 30, 2010 results.  We believe our financial performance in 2010 showcases the effectiveness of our aggressive growth strategy.  We have seen strong organic growth this year, coupled with an unprecedented number of successful acquisitions, which resulted in sales growth of 2 1/2 times.  The integration of these new additions into our existing operations will continue to benefit the Company. We will continue to look for other strategic actions to create the best possible value for our shareholders. We expect continued high demand for our products in the long-term, as approximately 80% of China's electricity generation is fueled by coal. We look forward to fiscal year 2011 with enthusiasm, and will share any new developments as they materialize."

Financial Outlook for Fiscal Year 2011

Management reaffirms previously stated guidance of $218 million in revenue and $46 million in net income for fiscal year 2011 ended April 30, 2011. These organic growth projections translate to EPS of $1.61 based on 29 million shares outstanding today. This does not include Company's potential acquisitions. Revenue and net income guidance projections for fiscal year 2011 represent year-over-year growth of 100% and 56%, respectively, from 2010.

The Company expects

• Revenue of $218 million for the 2011 fiscal year ending April 30, 2011 which represents growth of approximately 102% over previously released 2010 guidance of $108.1 million.
• Expects net income after tax and minority interest to grow from an estimated $28.1 million in 2010 to $46.7 million in 2011 for an increase of 66%. The Company is
• Earnings per share of $1.33 for 2011, an increase of 41% over previously released 2010 guidance EPS of $0.94 for the fiscal year 2010.

Removing L&L Energy from the GeoBargain list. The company issued bullish fiscal 2011 annual guidance. However, breaking the guidance down on a quarterly basis will likely not result in the quarterly 30% EPS minimum growth required for a GeoBargain.

Added to the GeoBargain List on May 19, 2009  @ $1.90

Reached a high of $14.91 in April 2010.

Current price $10.25

Management believes revenues and earnings would exceed the previously provided guidance released in March 2010. Management said that it expects fiscal 2010 annual revenue ended on April 30, 2010 to be higher than $108.1 million. The Company also believes net income would exceed the previously announced $28.1 million, or $0.94 EPS, on a GAAP basis, subject to final audit.

"We have two important elements working in our favor: first, demand for coal in the world's fastest growing economy, China, continues to exceed supply; and secondly, the PRC's mandate that smaller coal mines make infrastructure investments to improve efficiency and safety or face being shut down. With the mandate in process, we intend to acquire more profitable coal mines and help comply with the PRC mandate, that will bring in significant revenue and profits."

Valuation Scenarios

Coded as a GeoBargain on May 19, 2009 at a price of $1.90

Data Inputs:

Fiscal Year Ends in April
 

This morning LLFH announced the closing of a financing deal with Laidlaw & Company.  This is significant as LLFH previously stated fiscal 2010 guidance was contingent upon financing, which was also reaffirmed. The GeoTeam® is still awaiting news of an exchange uplisting.

Source: PR News Wire (October 9, 2009) 

Yesterday, LLFH released its fiscal 2010 first quarter financial results. 

At first glance the results were not up to par to what we were looking for. However, the following factors have to be considered :

1. Less than one month of sales were included in its recently acquired coal washing facilities.

2. The GeoTeam® is assuming that there may have been some one time integration costs associated with the coal washing facilities.

3. In its Rodman investor presentation LLFH issued very bullish guidance.

4. Comments from the company remain bullish:

"In the next quarter, L&L will show a full 3 months of operations from coal washing and results will be much more impressive as Hon Shen and DaPuAn have a combined annual capacity of over 500,000 tons."

Source: PRnewswire (September 15, 2009)

^a The above forecasts reflect the Company's current and preliminary views and are therefore subject to change. Please refer to the Company's Safe Harbor Statement (usually in press releases) for the factors that could cause actual results to differ materially from those contained in any forward-looking statement.

^b Guidance is subject to funding requirements.

Excerpt from the GeoTeam's® initial report on L & L Intl Holdings.

Tying It All Together

L&L's favorable revenue guidance along with industry trends have prompted the GeoTeam to follow the LLFH story. At a quick glance the the stock is selling at at P/E of just 5 times the fully taxed adjusted 2010 analyst EPS estimate of $0.39 (Analyst estimate is $0.47) Furthermore, this estimate is likely conservative for three reasons:

1. The estimate is based on revenue of $55.1 million which is below the company's recently stated guidance of $95 million.
   
2. The estimate is based on 22.49 million diluted shares outstanding. The company currently has 20.5 million diluted shares outstanding.
   
3. The estimate does not include the revenue contribution from its new coal washing endeavor.

It should be safe to assume that analyst EPS estimates will be substantially raised. A quick rudimentary analysis implies 2010 EPS potential of $0.74 fully taxed. The company should be reporting 2009 year end results shortly, which will shed further light on the future, at which time the The GeoTeam will create detailed potential valuation scenarios.

Its also interesting to note that currently L&L owns 60% of its recently acquired mines. The company has commented, in its SEC filings, that it would like to pursue a 100% ownership. Depending on how such a deal would be structured it could add another element of EPS upside.

Valuation Scenarios

Coded as a GeoBargain on May 19, 2009 at a price of $1.90

Data Inputs:

Fiscal Year Ends in April
 

Fiscal Year Ends April

Source: See Filing for the period ended October 31, 2008

 
Fiscal 3rd QUARTER 2009 vs. 2008 FINANCIAL SNAPSHOT ENDED JANUARY

Source: See Filing for the period ended January 31, 2009

GeoNuggets®- Quick Check List Highlighting Undiscovered Opportunities.

L & L International Holdings (OTCBB:LLFH)

Price (5/22/09) = $2.10

Company Description: The Company holds and operates profitable coal mines and wholesale facilities in China.

L & L Intl Holdings is the newest addition to the GeoBargain List as it meets nine out of the ten GeoBargain® criteria and is taking the necessary steps to propel its growth to the next level.

	Requirement
	Recent 52-week High
	30% EPS Growth Rate
	10% Revenue Growth
	Strong Balance Sheet
	Positive Cash Flow
	Debt to Equity Ratio less than 20%
	Current Ratio is at least 2:1
	Return on Equity is at least 15%
	Minimum Pre-tax Operating Margins of 8%
	Preferably Under 50 Million Shares
	High Insider Ownership (generally greater than 15%)
	Limited Institutional Ownership
	P/E Divided by Growth Rate (PEG Ratio) is Less Than 1.

L & L Intl Holdings is not your typical U.S. Listed Chinese firm. The company has United States head quarters with an American influenced management team and has been in operation for 13 years. The Company recruits bilingual professional accountants, engineers, advisors and assigns them to China to improve operations and impart American management philosophy.

L & L Intl Holdings participates in the coal related business. The company's mining and distribution operations are in Yunnan, a coal rich province of China. Prior to coal mining operations the company was engaged in the business of selling air compressors to coal mines to pump air into mines. However, through this venture the company recognized a greater opportunity to directly participate in coal mining operations . Thus, to focus on this opportunity, L&L recently spun off its air compressor operation. The company's current strategy relies on three modes of revenue.

1. Wholesale Revenue. In 2006 L & L Intl entered into the coal aggregation market as a Wholesaler. The company gathers coal from entities that operate mines which, it then re-sells to its customers. The majority of coal mining operations in china are comprised of small "mom and pop" ventures. The players tend to be inefficient and unsophisticated and not large enough to supply the needs of large end user customers. Customers would prefer to purchase their coal needs from a few reliable source. This need has created a market for well organized firms such as L & L Intl.
   
   
2. Direct Mining Revenue. In 2008 the company made a decision to vertically integrate its operations and actually take ownership in coal mines. Doing so would help them meet the increasing demand for coal in china that far outweighs supply. This also makes strategic sense in that they have an existing loyal customer base who they can sell their coal to. Furthermore, direct ownership should result in higher margins compared to wholesale operations. The company executed this strategy in May 2008 when it acquired a 60% interest in two income producing coal mines located in the Yunnan coal rich region of China. Acquiring an income producing mine is significant as it generally takes 3 to 5 years for a new mining venture to become income producing. The GeoTeam found it interesting that customers actually pick up the coal from L & L Intl's mine locations, limiting transportation costs.

   Benefits to direct ownership of coal mines:

   • Direct mining business has significantly higher margins than the Wholesale business.
     
   • Will enable the company to increase its coal capacity, thereby attracting more customers and enabling it to meet the greater demand for coal in China.
     
   • Could make the company a viable acquisition target.
     
     
3. Coal Washing Revenue. Building on its vertical integration strategy the company just announced its entry into to the coal washing market. What is coal washing and its significance? Coal washing is a process that separates coal into "quality tranches." The coal is crushed and then doused with water. The washed coal is then separated by weight into categories of poor, medium and high quality. The higher quality tranche commands a higher price. When coal is sold unwashed it will thus command a lower price. Entering this market is a logical step as the company can now offer a complete product to its customers at higher prices. Customers also become more satisfied by knowing what they are buying and not having to outsource the washing process.

Reasons L & L Intl Holdings Has Piqued The GeoTeam's Interest

1. Poised For Major Revenue Gains. The Company's coal capacity is increasing:
   
   
   • The company plans to increase the capacity of its current two mines by 88% to 450k tons annually.
   • L&L owns an 85% interest in a third mine which is expected to receive an official license, becoming operational by the end of 2009, with an estimated 200,000 tons of annual coal capacity.
   • L&L owns a 65% interest in a fourth mine slated for operation in 2011.
   • At full capacity the new coal washing facility can process 300 million tons and can produce annual revenues of $30 million.
   • The company's vertical integration should enable it to gain more customers as a one stop shop source for coal.
   
   
2. Industry Dynamics Are Favorable
   
   
   • Coal represented over 70% of China energy source in 2008.
   • China's Stimulus Plan is already giving a boost to its economy.
   • L&L's operations are located in the Yunnan Province whose infrastructure demands require large quantities of steel, coke, and coal.
   
   
3. Margins to Remain Healthy
   
   
   • Vertical integration into direct mining activities should increase overall margins.
   • Coal prices should increase which becomes more advantageous as the company strengthens its direct mining endeavors.
   • Vertical integration into coal washing should create greater pricing power.
   
   
4. Competitive Advantage
   
   
   • Vertical integration should enable it to retain and attract new business as a one stop shop.
   • The Company's American management philosophy and organization make it more attractive than inefficient fragmented competitors.
   
   
5. Focus on Enhancing Shareholder Value
   
   
   • The company shares information with Wall Street.
   • The company recently reduced its shares outstanding to approximately 20.5 million shares from 22.5 million shares, which will help to drive EPS growth.
   
   
6. Favorable 2009 Guidance

   On April 28, 2009 L&L issued revenue guidance of $95 million. The company reported revenues of $30 million for the nine months ended December 2008. Furthermore, this guidance does not include the revenue contribution from its new coal washing endeavor.

L&L's favorable revenue guidance along with industry trends have prompted the GeoTeam to follow the LLFH story. At a quick glance the the stock is selling at at P/E of just 5 times the fully taxed adjusted 2010 analyst EPS estimate of $0.39 (Analyst estimate is $0.47) Furthermore, this estimate is likely conservative for three reasons:

1. The estimate is based on revenue of $55.1 million which is below the company's recently stated guidance of $95 million.
   
2. The estimate is based on 22.49 million diluted shares outstanding. The company currently has 20.5 million diluted shares outstanding.
   
3. The estimate does not include the revenue contribution from its new coal washing endeavor.

Plan of Operations

As China does not substantial petroleum or natural gas reserves, different from that of the US, 71% of China energy is relying on coal. As China economy continues coal grow at high speed, supply of coal cannot meet the demand, thus drives coal prices upward in the recent years. This continuing demand of coal provides a leading, competitive edge for L&L energy operations, which is based on the coal rich region of Yunnan Province in the southwestern area of China. Yunnan’s strong infrastructure demands large quantities of steel, coke, and coal supplies in the next 3 years. As a result, the Company plans to expand its energy business via M&A existing operation to following government’s oligopoly policy that is to aim to eliminate many small inefficient coal mines, to increase operational efficiency and safety standards.

The Company has entered 3 MOUs to acquire other energy related entities in Yunnan Province in July of 2008, following its policy to continuously acquire and expand other profitable energy entities in China and other parts of the world. Due to the unexpected Wall Street financial crisis, happened in the summer of 2008, the US liquidity is dried up which resulting a delay of the Company funding process. It is the Company’s plan to focus on funding while upgrading its team by inviting additional qualified professionals to help growth.

L&L is a US company, public listed in the US OTC-BB market since 8/4/2008. L&L is known to have organizational skills and visions to upgrade the coal mining standards, which most of the local small China miners do not have. To ensure its growth momentum, L&L is investing its time and resource to develop strategic relationship with large Japanese coal trading firms, not only to learn the high standards of Japan coal operations but also to take advantage of price differences between the higher international coal markets, and lower China domestic markets, following the Company international operational policy.

The Company seeks institutions capital funding to increase its business competitive advantages and to fund acquisitions. The Company registered the KMC and LSP investments with the Chinese government, and is in process to register the 2 Mines (“L&L Coal”) and recruit experienced managers to join in as executives, when financial resources become feasible.

Source: SEC Form 10Q (FOR THE FIRST QUARTER ENDED ON October 31, 2008)