China 9D's wholly-owned subsidiary, China 9D Decoration Group Limited ("CDG Limited"), was the surviving entity in a merger transaction completed August 10, 2007 involving China 9D, CDG Limited and its stockholders, and another wholly-owned subsidiary, MQOZ Merger Sub, Inc. (the "Merger Transaction"). Under the Merger Transaction, in exchange for surrendering their shares in CDG Limited, the stockholders of CDG Limited received 35,796,796 newly-issued shares of China 9D's common stock and $15,500,000 in the form of promissory notes payable on or before the first year anniversary of the merger. For financial reporting purposes, the Merger Transaction has been treated as a reverse acquisition capital transaction, with CDG Limited deemed to be the accounting acquirer. Accordingly, the transaction has been reflected in the accompanying consolidated financial statements as a recapitalization, and the financial information presented is that of CDG Limited and its wholly-owned operating company subsidiary, Zhejiang 9D Decoration Company Limited (the "Operating Subsidiary").
We are a leading architectural and interior design and decoration and furnishing company focusing on residential, mansion, hotel, commercial and law firm buildings. In order to increase sales and our market share as well as promote our brand awareness and recognition, we expanded into the commercial market during 2007. We have our corporate offices in Hangzhou, Zhe Jiang and operate approximately 26 branches in Jiangsu, Anhui, Hunan, Hubei, San Dong, Jingzi, Fujian and Shanghai.
Our Operating Subsidiary's short to mid-term strategic plans are to focus on market expansion in the Chinese domestic commercial market while maintaining our status in the residential market. The long-term strategic goal is to focus on market expansion in the international market.
Of our approximately 3,000 current
employees, approximately 556 are full-time employees and approximately 2,494 are
The headquarters for our company and its Operating Subsidiary is at 4F Jia
De Plaza, No. 118 Qing Chun Road, Hangzhou City, Zhejiang Province, P.R. China.
The headquarter covers approximately 500 square meters of building space and is
owned by us.
In addition to our headquarters, we lease building space through our
Operating Subsidiary in twenty-seven (27) branch locations located in Jiangshu,
Anhui, Hubei, Sandong, Jingzi, Fujian and Shanghai.
Sales were $50,835,581 for the nine months ended September 30, 2007. This
is in comparison to sales of $30,639,311 for the year ended December 31, 2007.
During 2007, we expanded our business into projects for commercial customers. As
such, our revenues have increased and we are reporting higher revenues for the
nine months ended September 30, 2007 than we experienced for the year ended
Net income was $3,022,078, or approximately 6% of sales, during the nine
months ended September 30, 2007