American Oriental Bioengineering (NYSE: AOB) announced another solid financial performance in Q3. The company’s revenues rose 62% to $70.6 million, and net income was higher by 38% at $16.5 million or 21 cents per diluted share. According to the company, net income failed to keep pace with the rise in revenues because of higher sales and marketing expenditures and because of amortization of costs from acquisitions.

The bulk of American Oriental’s revenues came from pharmaceutical products. This division produced $62.1 million of revenues, a 75% increase. OTC products climbed 91% to $37.8 million. In contrast, nutraceutical products were flat, up a meager 6% at $8.5 million.

Since the third quarter of 2007, American Oriental has closed two acquisitions: CCXA and Boke. These two companies added $17.1 million of revenue to the company’s pharmaceutical and OTC divisions during Q3. That means the acquisitions were responsible for well over half of the increase in sales for American Oriental.

Because the results were strong, American Oriental bumped its forecast for full-year 2008 revenues by $5 million to $250 million. Net income is expected to hit $62 million before any interest costs from a recent convertible note instrument. In July, American Oriental placed $115 million in convertible notes and reiterated its intention of buying back $30 million in stock. The company did not discuss its progress on the stock buyback.

In October, American Oriental announced that it would spend $53.1 million to make two acquisitions: drug distributor Nuo Hua and GHK, a pharmaceutical firm. Those acquisitions did not have any effect on Q3 results.

The company ended Q3 with more than $220 million in cash, but that amount will be diminished by the two recently announced acquisitions and the uncompleted part of the stock buyback. After the earnings release, American Oriental climbed 37% (6%) to $6.45, giving the company a market capitalization of $551 million.