CHINA DU KANG CO. LTD.

CIK:0001472635|SEC Filings

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (USD $)	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Revenues
Sales of Liquor	$ 504,374	$ 1,215,394	$ 2,898,119	$ 3,601,121
Costs of Liquor Sold	410,793	856,042	2,190,418	2,185,630
Gross Profit	93,581	359,352	707,701	1,415,491
Selling Expenses
Advertising expenses	11,392	30,637	36,238	107,715
Promotion expenses	105,738	104,931	117,513	284,035
Office expenses	238	7,009	6,692	13,460
Sales commission	37,753	44,176	117,378	115,768
Travel and entertainment	19,442	20,155	56,948	56,904
Total Selling Expenses	174,563	206,908	334,769	577,882
General and administrative expenses
Payroll	56,643	69,392	158,843	161,658
Employee benefit and pension	4,358	21,280	16,227	35,033
Depreciation and amortization expenses	61,261	31,233	183,709	92,001
Professional Fees	47,628	3,382	71,906	6,550
Taxes	134,327	7,333	149,870	21,057
Office expenses	13,699	15,357	34,635	38,791
Vehicle expenses	2,506	4,852	10,727	19,325
Bad debt expenses				25,191
Travel and entertainment	3,267	6,706	10,537	20,011
Other general and administrative expenses	2,954	161	3,790	2,368
Total General and Administrative Expenses	326,643	159,696	640,244	421,985
Total Operating Expenses	501,206	366,604	975,013	999,867
Income from Operations	(407,625)	(7,252)	(267,312)	415,624
Other Income (Expenses)
Interest income	295	362	1,027	885
Interest Expenses-capital lease	(12,303)	(10,324)	(37,019)	(30,714)
Governmental subsidy			56,908
Other income (expense)	14,097	(440)	31,844	(105,613)
Total Other Income (Expenses)	2,089	(10,402)	52,760	(135,442)
Net Income (loss) for continuing operations	(405,536)	(17,654)	(214,552)	280,182
Provision for Income Tax	(65,979)		(65,979)
Net Income (Loss) before discontinued operations	(471,515)	(17,654)	(280,531)	280,182
Discontinued Operations
Income (loss) from operations of discontinued		(49,315)		(37,545)
Income tax benefit (expense)		2,657		(285)
Net Income (loss) from discontinued operations		(46,658)		(37,830)
Net Income (Loss)	(471,515)	(64,312)	(280,531)	242,352
Less: Net loss (income) attributable to noncontrolling interest	175,776	21,267	75,163	5,722
Net Income (Loss) attributable to China Du Kang Co., Ltd.	$ (295,739)	$ (43,045)	$ (205,368)	$ 248,074
Basic and Fully Diluted Income (Loss) per Share	$ 0.00	$ 0.00	$ 0.00	$ 0.00
Weighted average shares outstanding	100,113,791	100,113,791	100,113,791	100,113,791

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (USD $)	9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013
Cash Flows from Operating Activities
Net income (loss) including non-controlling interest	$ (280,531)	$ 242,352
Adjustments to reconcile net income including non-controlling interest to net cash provided (used) by operating activities
Loss (income) from discontinued operations		37,830
Depreciation	412,934	285,639
Amortization	31,393	32,000
Bad debt expense		25,191
Obsolete inventory write-down	66,068	85,210
Changes in operating assets and liabilities:
(Increase)/Decrease in notes receivable	32,519	(32,147)
(Increase)/Decrease in accounts receivable	(99,108)	(57,311)
(Increase)/Decrease in others receivable	(44,473)	(25,611)
(Increase)/Decrease in prepaid expenses	(141,569)	(164,730)
(Increase)/Decrease in inventories	(155,138)	(1,138,548)
Increase/(Decrease) in accounts payable	108,788	1,081,218
Increase/(Decrease) in accrued expenses	220,647	161,499
Increase/(Decrease) in other payable	51,558	55,235
Increase/(Decrease) in taxes payable	(61,199)	46,231
Increase/(Decrease) in deferred revenue	(126,619)	(712,523)
Increase/(Decrease) in security deposit	7,436
Increase/(Decrease) in capital lease interest payable	(37,019)	(30,714)
Net cash provided (used) by operating activities of continued operations	(14,313)	(109,179)
Net cash provided (used) by operating activities of discontinued operations		(148,592)
Net cash provided (used) by operating activities	(14,313)	(257,771)
Cash Flows from Investing Activities
Purchase of fixed assets	(370,237)	(138,762)
Net cash provided (used) by investing activities of continued operations	(370,237)	(138,762)
Net cash provided (used) by investing activities of discontinued operations		(1,592)
Net cash provided (used) by investing activities	(370,237)	(140,354)
Cash Flows from Financing Activities
Repayments to related parties
Repayment for a capital lease principal	(41,858)	(54,489)
Net cash provided (used) by financing activities of continued operations	(41,858)	(54,489)
Net cash provided (used) by financing activities of discontinued operations
Net cash provided (used) by financing activities	(41,858)	(54,489)
Increase (decrease) in cash	(426,408)	(452,614)
Effects of exchange rates on cash	(22,500)	(51,618)
Cash at beginning of period	573,546	681,702
Cash at end of period	124,638	177,470
Less: Cash at end of period-discontinued operations		7,997
Cash at end of period-continuing operations	124,638	169,473
Supplemental Disclosures of Cash Flow Information:
Cash paid during the year for: Interest	37,019	30,714
Cash paid during the year for: Income taxes	$ 65,979	$ 285

CONSOLIDATED BALANCE SHEETS (USD $)	Sep. 30, 2014	Dec. 31, 2013
Current Assets:
Cash and cash equivalents	$ 124,638	$ 573,546
Notes receivable		32,712
Accounts receivable (Note 4)	622,937	527,521
Others receivable	74,804	30,581
Prepaid expenses (Note 5)	608,636	470,409
Inventories (Note 6)	8,417,266	8,385,490
Total current assets	9,848,281	10,020,259
Property, Plant and Equipment, net (Note 7)	6,952,107	7,023,716
Intangible assets, net (Note 8)	1,934,116	1,978,981
Long-term investment	1,999,902	2,013,641
Total Assets	20,734,406	21,036,597
Current Liabilities:
Accounts payable	2,383,599	2,290,540
Accrued expenses (Note 9)	358,298	138,805
Others payable	147,345	96,494
Taxes payable (Note 10)	7,375	68,987
Deferred revenue (Note 11)	1,775,603	1,915,169
Security deposit	39,157	31,946
Lease liability-current	46,266	76,892
Total Current Liabilities	4,757,643	4,618,833
Long-term Liabilities:
Lease liability-long-term	636,270	689,677
Total Long-term Liabilities	636,270	689,677
Total Liabilities	5,393,913	5,308,510
Commitments and Contingencies (Note 16)
China Du Kang Co., Ltd. Shareholders' Equity
Preferred stock, par value $0.001, 5,000,000 shares authorized; no shares issued and outstanding as of September 30, 2014 and December 31, 2013
Common stock, par value $0.001, 250,000,000 shares authorized; 100,113,791 shares issued and outstanding as of 86,000,000 shares issued and outstanding as of September 30,	100,114	100,114
Additional paid-in capital	26,593,393	26,593,393
Accumulated deficit	(21,293,686)	(21,088,318)
Accumulated other comprehensive income	(543,500)	(436,437)
Total China Du Kang Co., Ltd. Shareholders' equity (deficit)	4,856,321	5,168,752
Noncontrolling Interest	10,484,172	10,559,335
Total Equity (Deficit)	15,340,493	15,728,087
Total Liabilities and Equity (Deficit)	$ 20,734,406	$ 21,036,597