Editorial Summary

Chinese finance industry software and service provider Longtop Financial Technologies Limited (NYSE: LFT) announced second quarter financials for the period ending September 30 after market close on Monday. Longtop recorded US$20.2 million in total revenue, increasing 80.3 percent year-on-year, and net income of US$11.6 million. Software development revenue accounted for US$18.2 million of total revenue, up 115.6 percent year-on-year. Longtop generated approximately $143 million through its initial public offering of nine million American depositary shares on October 24. In the same month, Longtop completed the acquisition of Chinese business intelligence company FEnet to add 261 employees to Longtop's existing 1,094 member staff. Longtop expects third quarter (period ending December 31) revenue, excluding FEnet revenue, to come in at $15.5 million. The estimate is an increase of 33.6 percent year-on-year, but a quarter-on-quarter decrease of 23 percent due to "seasonality". Included in total revenue, Longtop predicts $13.5 million to be generated by software development. The company forecasts third quarter net income of $8.5 million, up from $5.3 million in the year ago period. For the fourth quarter (ending March 31, 2008), Longtop expects total revenue to reach $58 million, with 84 percent of the total coming from software development revenue, and net income to hit $30 million.