Longwei Petroleum Reports April And May 2012 Revenues Up 4.6% Year-Over-Year To $89.0 Million
TAIYUAN CITY, China, June 26, 2012 /PRNewswire-Asia-FirstCall/ -- Longwei Petroleum Investment Holding Ltd. (NYSE Amex: LPH) ("Longwei" or the "Company"), an energy company engaged in the storage and distribution of finished petroleum products in the People's Republic of China ("PRC"), today reported its revenues for April and May 2012 were up 4.6% year-over-year to $89.0 million.
For the eleven-month period ended May 31, 2012, Longwei reported its revenues were up 5.6% year-over-year to $463.2 million. During this period the retail price of gasoline was adjusted by the National Development and Reform Commission ("NDRC"), the PRC's top economic planning organization, five times during a period of fluctuating international crude oil prices. The retail price of gasoline in the PRC has been adjusted upward twice and downward three times for different durations of time during the Company's fiscal 2012. While the Company's overall sales price per metric ton has gone up year-over-year because of the longer periods at higher prices, the net effect of the retail price changes is that gasoline prices for the PRC consumer are now 2.8% lower than at June 30, 2011.
Brent crude oil, one of the primary components in the basket of crude oil prices used by the NDRC to determine the retail price of gasoline in the PRC, is currently trading near 18-month lows of approximately US $90 per barrel. Brent crude oil's most recent peak was approximately US $128 per barrel in early March 2012. ( Reuters, June 21, 2012, "Oil Falls Below $90 for the First Time Since December 2010.")
The Company continues to use its working capital to increase its inventory position and product availability based on the current changes in the market price. "We are balancing our working capital to take advantage of pricing opportunities, as well as balancing the funding required to complete the acquisition of the Huajie Petroleum assets," stated Mr. Cai Yongjun, Chairman and CEO of Longwei. "We look forward to finalizing the Huajie Petroleum asset purchase, which will add another 100,000 metric tons to our storage capacity and solidify our position as one of the largest private fuel distributors in the PRC."
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