Longwei Petroleum (fka LPIH)

[estategame]

i hope this isnt annoying and you guys are patient with me, since you have much more knowledge of the game than I. But i am just trying to progress like you and have to start some where.

im doin a little research on LPIH and dont understand how the revenue, gross profit and adjusted net income are up but the net income appears to be down unless its adjusted from GAAP? is the adjusted the one to be more in tune with? I dont understand the reasoning behind GAAP since it appears the adjusted is the one more accurate. it appears there is wiggle room when using GAAP and things recorded that dont really accutately represent the companies expenses, is this right?



Net income for the three months ended March 31, 2010 was $12.1 million as compared to $6.7 million for the three months ended March 31, 2009, due to the reasons set forth above. In accordance with GAAP, the Company recorded a noncash expense to record the change in the fair value of derivatives. The financial instruments classified as derivatives consisted of stock warrants issued in connection with the October 2009 Financing and 285,714 previously outstanding stock warrants issued in February, 2009. If the noncash adjustment had not been necessary to record, the Company's net income would have been $13.3 million, which would represent net income growth of 99.7% for the three months ended March 31, 2010 as compared to the three months ended March 31, 2009.

Net income for the nine months ended March 31, 2010 was $15.7 million as compared to $20.9 million for the nine months ended March 31, 2009. In accordance with GAAP, the Company recorded a noncash expense to record the change in the fair value of derivatives. The financial instruments classified as derivatives consisted of stock warrants issued in connection with the October 2009 Financing and 2.7 million previously outstanding stock warrants issued in February, 2009 and December, 2007. If the noncash adjustment had not been necessary to record, the Company's net income would have been $30.8 million, which would represent net income growth of 47.5% for the nine months ended March 31, 2010 as compared to the nine months ended March 31, 2009. There was no noncash adjustment for the adjustment to the fair value of the Company's stock warrants during the nine months ended March 31, 2009.


Third Quarter Ended March 31,



2010 2009

Revenues
$96.9 M $49.7 M

Gross Profit
$19.5 M $9.7 M

Adjusted Net Income
$13.3 M $6.7 M

GAAP Net Income
$12.1 M $6.7 M

Adjusted Basic EPS
$0.15 $0.09

GAAP EPS
$0.14 $0.09




Nine Months Ended March 31,


2010 2009


Revenues
$227.5 M $147.8 M

Gross Profit
$45.1 M $31.3 M

Adjusted Net Income
$30.8 M $20.9 M

GAAP Net Income
$15.7 M $20.9 M

Adjusted Basic EPS
$0.37 $0.27

GAAP EPS
$0.08 $0.27



am i reading this chart right? earnings dont seem to be down but the aarows say they are. i thought earnings were up from a year ago, maybe down from last quarter though?:

http://www.marketwatch.com/investing/stock/LPIH/charts?countryCode=US&submitted=true&intflavor=advanced&origurl=%2Ftools%2Fquotes%2Fintchart.asp&time=8&freq=1&comp=Enter%20Symbol(s)%3A&compidx=aaaaa~0&compind=aaaaa~0&uf=2048&ma=1&maval=50&lf=1&lf2=67108864&lf3=0&type=2&size=1&optstyle=1013

also, do you know how much stock the management owns? i cant find anything on it.


by the way, PERT is on the bid and ask on this stock too. who is this guy and do you think it matters? his bid is so ridiculous at .0001 and the ask at 2.04. i dont get it.