AutoChina International today announced that the Company is being investigated by the U.S. Securities and Exchange Commission (SEC), and expects to restate its previously issued financial statements for the year ended December 31, 2009, and subsequent periods to recognize a derivative liability relating to the Earn-out Share Provision, which was part of its initial business combination in 2009.
AutoChina reiterates its previously announced financial guidance for 2011. The Company believes revenue from its commercial vehicle sales, servicing, leasing and support business will be between $900 million and $950 million and net income between $52 million and $57 million.
The company expects to lease approximately 20,000 vehicles in 2011 and operate at least 500 stores by the end of 2011. The company believes revenue will be between $900 million and $950 million and net income between $52 million and $57 million for the year ending December 31, 2011. The company expects continued improvement in gross margin as finance and insurance revenues increase as a percentage of total revenues in each quarter.
"We were pleased with the steady growth throughout our operations in the fourth quarter, in addition to a number of exciting developments that we announced during the period. We continued to expand in southern China, opening 82 stores and leasing 3,076 vehicles during the fourth quarter. We also announced the establishment of a new financial leasing company and the conversion of our existing wholly foreign-owned enterprise into a financial leasing company. These two financial leasing companies will allow us to lease commercial vehicles directly to our customers and represent the first steps in the transition away from our VIE holding structure."