American Oriental Bioengineering Reports Third Quarter 2008 Financi...(LIABILITIES AND SHAREHOLDER...)

SHAREHOLDERS' EQUITY $503,907,426 $353,714,896 AMERICAN ORIENTAL BIOENGINEERING, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (UNAUDITED)

THREE MONTHS ENDED NINE MONTHS ENDED

SEPTEMBER 30, SEPTEMBER 30,

2008 2007 2008 2007

REVENUES $70,593,949 $43,514,049 $168,372,552 $103,062,573

COST OF GOODS

SOLD 23,402,407 12,833,252 54,808,490 31,048,916

GROSS PROFIT 47,191,542 30,680,797 113,564,062 72,013,657

Selling and

marketing 9,938,877 5,644,776 22,656,477 12,210,509

Advertising 9,913,728 6,934,160 21,760,300 16,150,754

General and

administrative 4,467,638 3,742,364 13,633,595 9,234,426

Depreciation

and

amortization 1,024,436 377,856 3,012,107 1,054,128

Total

operating

expenses 25,344,679 16,699,156 61,062,479 38,649,817

INCOME FROM

OPERATIONS 21,846,863 13,981,641 52,501,583 33,363,840

EQUITY IN

EARNINGS

(LOSS) FROM

UNCONSOLIDATED

ENTITIES 49,417 3,953 (591,650) 14,848

INTEREST INCOME

(EXPENSE), NET (1,143,013) 360,365 (1,156,782) 375,604

OTHER INCOME

(EXPENSE), NET 91,986 (16,144) (264,515) 118,436

INCOME BEFORE

INCOME TAXES 20,845,253 14,329,815 50,488,636 33,872,728

INCOME TAXES 4,362,334 2,386,189 10,723,896 5,846,543

NET INCOME 16,482,919 11,943,626 39,764,740 28,026,185

OTHER

COMPREHENSIVE

INCOME

Foreign

currency<
'/>"/>