Form 6-K
 
 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of April 2010
 
Commission File Number: 001-34238
 
THE9 LIMITED
Building No. 3, 690 Bibo Road
Zhangjiang Hi-tech Park, Pudong New Area
Shanghai 201203, People’s Republic of China
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F þ            Form 40-F o
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): o
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): o
 
 

 

 

 

SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
         
  THE9 LIMITED
 		  
  By:   /s/ Jun Zhu    
    Name:   Jun Zhu   
    Title:   Chairman and Chief Executive Officer   
Date: April 16, 2010

 

 

 

Exhibit Index
     
Exhibit 99.1  
Unaudited consolidated financial information for the quarter ended December 31, 2009 and audited consolidated financial information for the year ended December 31, 2009

 

 

 

Exhibit 99.1
THE9 LIMITED
CONSOLIDATED STATEMENTS OF INCOME INFORMATION
(Expressed in Renminbi — RMB and US Dollars — US$, except share data)
                                                         
    Quarter Ended     Year Ended  
    December 31,     September 30,     December 31,     December 31,     December 31,     December 31,     December 31,  
    2008     2009     2009     2009     2008     2009     2009  
    RMB     RMB     RMB     US$     RMB     RMB     US$  
    (unaudited)     (unaudited)     (unaudited)     (unaudited)     (audited)     (audited)     (unaudited)  
Revenues:
                                                        
Online game services
     429,643,488       25,744,962       20,712,264       3,034,364       1,800,313,225       795,476,714       116,537,997  
Game operating support, website solutions and advertisement
     118,972       79,208       58,201       8,526       598,797       570,600       83,593  
Other revenues
     1,290,119       1,077,513       1,277,179       187,108       5,218,199       6,582,037       964,274  
 
                                          
 
     431,052,579       26,901,683       22,047,644       3,229,998       1,806,130,221       802,629,351       117,585,864  
 
                                                        
Sales Taxes
     (22,492,929 )     (1,410,747 )     (1,150,060 )     (168,485 )     (94,639,527 )     (42,113,498 )     (6,169,662 )
 
                                          
 
                                                        
Net Revenues
     408,559,650       25,490,936       20,897,584       3,061,513       1,711,490,694       760,515,853       111,416,202  
 
                                          
 
                                                        
Cost of Services
     (249,170,341 )     (33,606,420 )     (96,909,129 )     (14,197,268 )     (997,948,540 )     (712,472,751 )     (104,377,848 )
 
                                          
 
                                                        
Gross Profit (loss)
     159,389,309       (8,115,484 )     (76,011,545 )     (11,135,755 )     713,542,154       48,043,102       7,038,354  
 
                                                        
Operating Expenses:
                                                        
Product development
     (24,492,343 )     (26,291,516 )     (30,496,768 )     (4,467,802 )     (73,819,607 )     (114,443,552 )     (16,766,075 )
Sales and marketing
     (29,748,961 )     (20,709,170 )     (18,539,240 )     (2,716,014 )     (103,725,123 )     (112,517,602 )     (16,483,922 )
General and administrative
     (145,305,184 )     (62,174,821 )     (46,454,604 )     (6,805,638 )     (319,298,044 )     (225,051,424 )     (32,970,220 )
Impairment of equipment, intangible assets and goodwill
     (82,149,755 )     —       (48,671,892 )     (7,130,472 )     (82,149,755 )     (78,871,643 )     (11,554,761 )
 
                                          
 
                                                        
Total operating expenses:
     (281,696,243 )     (109,175,507 )     (144,162,504 )     (21,119,926 )     (578,992,529 )     (530,884,221 )     (77,774,978 )
 
                                                        
(Loss) income from operations
     (122,306,934 )     (117,290,991 )     (220,174,049 )     (32,255,681 )     134,549,625       (482,841,119 )     (70,736,624 )
Interest income
     13,972,458       7,188,006       7,402,843       1,084,523       56,690,807       30,501,101       4,468,436  
Other (expense) income, net
     (1,082,325 )     55,967,903       6,122,924       897,013       (18,967,099 )     61,840,303       9,059,656  
 
                                          
 
(Loss) income before income taxes, impairment loss on investments and share of loss in equity investments
     (109,416,801 )     (54,135,082 )     (206,648,282 )     (30,274,145 )     172,273,333       (390,499,715 )     (57,208,532 )
Income tax (expense) benefit
     (24,070,899 )     (4,858,272 )     11,092,063       1,624,996       (47,928,533 )     5,535,866       811,009  
 
                                          
(Loss) income before impairment loss on investments and share of loss in equity investments
     (133,487,700 )     (58,993,354 )     (195,556,219 )     (28,649,149 )     124,344,800       (384,963,849 )     (56,397,523 )
Impairment loss on investments
     (24,020,108 )     (12,160,769 )     (10,251,500 )     (1,501,853 )     (25,922,363 )     (22,412,269 )     (3,283,416 )
Share of loss in equity investments, net of taxes
     (994,469 )     (677,625 )     (1,429,471 )     (209,419 )     (2,241,135 )     (2,555,515 )     (374,385 )
 
                                          
 
Net (loss) income
     (158,502,277 )     (71,831,748 )     (207,237,190 )     (30,360,421 )     96,181,302       (409,931,633 )     (60,055,324 )
Less: Net (loss) income attributable to noncontrolling interest
     (179,071 )     1,805,658       (1,714,026 )     (251,106 )     (654,734 )     (4,779,226 )     (700,161 )
 
                                          
 
                                                        
Net (loss) income attributable to holders of ordinary shares
     (158,323,206 )     (73,637,406 )     (205,523,164 )     (30,109,315 )     96,836,036       (405,152,407 )     (59,355,163 )
 
                                          
 
                                                        
Net (Loss) income attributable to holders of ordinary shares per share
                                                        
— Basic
     (5.78 )     (2.93 )     (8.18 )     (1.20 )     3.50       (15.94 )     (2.34 )
 
                                          
— Diluted
     (5.78 )     (2.93 )     (8.18 )     (1.20 )     3.50       (15.94 )     (2.34 )
 
                                          
 
                                                        
Weighted average number of shares outstanding
                                                        
— Basic
     27,410,714       25,094,283       25,119,580       25,119,580       27,664,687       25,414,620       25,414,620  
 
                                          
— Diluted
     27,410,714       25,094,283       25,119,580       25,119,580       27,704,201       25,414,620       25,414,620  
 
                                          
 
                                                        
Amount attributable to holders of ordinary shares
     (158,323,206 )     (73,637,406 )     (205,523,164 )     (30,109,315 )     96,836,036       (405,152,407 )     (59,355,163 )
 
                                          

 

 

 

THE9 LIMITED
CONSOLIDATED BALANCE SHEETS INFORMATION
(Expressed in Renminbi — RMB and US Dollars — US$)
                         
    As at  
    December 31,     December 31,     December 31,  
    2008     2009     2009  
    RMB     RMB     US$  
    (audited)     (audited)     (unaudited)  
 
Assets
                        
Current Assets
                        
Cash and cash equivalents
     2,152,585,574       1,675,081,345       245,400,803  
Short term investments
     68,039,221       —       —  
Accounts receivable
     8,323,084       920,214       134,812  
Due from related party
     637,708       1,110,424       162,678  
Advances to suppliers
     1,435,781       44,132,089       6,465,388  
Prepayments and other current assets
     68,371,912       77,896,385       11,411,885  
Prepaid royalties
     138,843,227       —       —  
Deferred costs
     55,748,737       1,516,601       222,183  
Deferred tax assets, current
     —       2,139,896       313,497  
 
                  
Total current assets
     2,493,985,244       1,802,796,954       264,111,246  
 
                  
Investments in equity investees
     291,642,529       308,806,125       45,240,353  
Available-for-sale investments
     29,218,400       —       —  
Property, equipment and software
     200,034,094       75,977,200       11,130,723  
Goodwill
     30,199,751       —       —  
Intangible assets
     136,129,801       51,628,286       7,563,587  
Land use right
     81,798,755       79,877,847       11,702,171  
Long-term deposits
     —       603,910       88,473  
Deferred tax assets, non-current
     —       5,267,185       771,647  
 
                  
Total Assets
     3,263,008,574       2,324,957,507       340,608,200  
 
                  
 
                        
Liabilities
                        
Current Liabilities
                        
Accounts payable
     29,758,563       35,013,675       5,129,532  
Income tax payable
     56,680       29,947       4,387  
Other taxes payable
     99,416,815       6,270,518       918,636  
Advances from customers
     143,464,990       11,154,437       1,634,134  
Deferred revenue
     201,645,952       10,933,464       1,601,762  
Refund of game points
     —       196,401,440       28,772,974  
Other payables and accruals
     69,423,536       51,704,425       7,574,741  
 
                  
Total current liabilities
     543,766,536       311,507,906       45,636,166  
 
                  
 
                        
Equity
                        
The9 Limited shareholders’ equity:
                        
Common shares (US$0.01 par value; 26,817,688 shares issued and outstanding as of December 31, 2008, 25,121,645 shares issued and outstanding as of December 31, 2009)
     2,190,645       2,051,712       300,578  
Additional paid-in capital
     2,128,607,581       2,069,616,975       303,200,600  
Statutory reserves
     24,836,354       28,071,982       4,112,569  
Accumulated other comprehensive income
     13,643,131       —       —  
Retained earnings (deficit)
     549,964,327       (88,364,685 )     (12,945,500 )
 
                  
Total The9 Limited shareholders’ equity
     2,719,242,038       2,011,375,984       294,668,247  
Non-controlling interest
     —       2,073,617       303,787  
 
                  
Total equity
     2,719,242,038       2,013,449,601       294,972,034  
 
                  
Total liabilities and equity
     3,263,008,574       2,324,957,507       340,608,200