SECURITIES
AND EXCHANGE COMMISSION


Washington,
D.C. 20549





FORM
10-Q





x
            QUARTERLY
      REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934





For
the quarterly period ended September 30, 2009





OR





o
            TRANSITION
      REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE
  ACT





For
the transition period from ______ to __________





COMMISSION
FILE NUMBER: 333-128532





CHISEN ELECTRIC
CORPORATION


(Exact
name of registrant as specified in its charter)





Nevada
            
            20-2190950(State
      or other jurisdiction of
              incorporation
      or organization)
            
            (IRS
      Employer
              Identification
      No.)





Jingyi
Road, Changxing Economic Development Zone, Changxing, Zhejiang
Province,


The
People’s Republic of China


(Address
of principal executive offices)





(011)
0572-6267666


(Registrant’s
Telephone Number, Including Area Code)





(Former
Name, Former Address and Former Fiscal Year, if Changed Since Last
Report)





Check
whether the issuer (1) has filed all reports required to be filed by Section 13
or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter
period that the issuer was required to file such reports), and (2)has been
subject to such filing requirements for the past 90 days. Yes x No o





Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such
files).  Yes o     No
o





Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer or a smaller reporting company filer.
 See definition of “accelerated filer” and “large accelerated filer” in
Rule 12b-2 of the Exchange Act (Check one):




Large
      Accelerated Filer o
            Accelerated
      Filer o
            Non-Accelerated
      Filer o
            Smaller
      Reporting Company x





Indicate
by check mark whether the registrant is a shell company as defined in Rule 12b-2
of the Exchange Act.  Yes  o No x





State the
number of shares outstanding of each of the issuer’s classes of common equity,
as of the latest practicable date:  As of November 12, 2009, the registrant
had 50,000,000 shares of common stock, par value $0.001 per share, issued and
outstanding.







TABLE
OF CONTENTS





PART
      I FINANCIAL INFORMATION
              
              F-iITEM
      1. FINANCIAL STATEMENTS
              
              F-iITEM
      2. MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF
    OPERATION
              
              3ITEM
      3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
    RISK
              
              12ITEM
      4. CONTROLS AND PROCEDURES
              
              13PART
      II OTHER INFORMATION
              
              14ITEM
      1. LEGAL PROCEEDINGS
              
              14ITEM
      1A. RISK FACTORS
              
              14ITEM
      2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF
    PROCEEDS
              
              14ITEM
      3. DEFAULTS UPON SENIOR SECURITIES
              
              14ITEM
      4. SUBMISSION OF MATTERS TO A VOTE OF SECURITYHOLDERS
              
              14ITEM
      5. OTHER INFORMATION
              
              14ITEM
      6. EXHIBITS
              
              14SIGNATURES
              
              18EXHIBIT
      31.1EXHIBIT
      31.2EXHIBIT
      32.1EXHIBIT
      32.2




2




PART
I


FINANCIAL
INFORMATION




ITEM
1. FINANCIAL STATEMENTS





PageUnaudited
      Condensed Consolidated Statements of Operations and Other
      Comprehensive Income
              
              F-1Unaudited
      Condensed Consolidated Balance Sheets
              
              F-2
      – F-3Unaudited
      Condensed Consolidated Statements of Changes in Stockholders’
      Equity
              
              F-4Unaudited
      Condensed Consolidated Statements of Cash Flows
              
              F-5Notes
      to and Forming Part of Unaudited Condensed Consolidated Financial
      Statements
              
              F-6
      – F-18




F-i




Chisen
Electric Corporation
 
 Unaudited
Condensed Consolidated Statements of Operations and Other Comprehensive
Income
 For the
six months ended September 30, 2009 and 2008
 
  Three months ended
                                                              September 30
                                                            
                                                            
                                                            Six months ended
                                                              September 302009
                                                            
                                                            
                                                            2008
                                                            
                                                            
                                                            2009
                                                            
                                                            
                                                            2008Note
                                                            
                                                            
                                                            US$’000
                                                            
                                                            
                                                            US$’000
                                                            
                                                            
                                                            US$’000
                                                            
                                                            
                                                            US$’000Operating
      revenues:Net sales to third
      parties
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            50,392
                                                            
                                                            
                                                            
                                                            35,588
                                                            
                                                            
                                                            
                                                            79,867
                                                            
                                                            
                                                            
                                                            57,813Cost
      of sales
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            (41,708
                                                            )
                                                            
                                                            
                                                            (28,521
                                                            )
                                                            
                                                            
                                                            (65,813
                                                            )
                                                            
                                                            
                                                            (46,715
                                                            )Gross
      income
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            8,684
                                                            
                                                            
                                                            
                                                            7,067
                                                            
                                                            
                                                            
                                                            14,054
                                                            
                                                            
                                                            
                                                            11,098Operating
      expenses:Sales, marketing
      anddistribution
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            (2,167
                                                            )
                                                            
                                                            
                                                            (1,337
                                                            )
                                                            
                                                            
                                                            (3,953
                                                            )
                                                            
                                                            
                                                            (2,442
                                                            )General and
      administrative
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            (1,030
                                                            )
                                                            
                                                            
                                                            (982
                                                            )
                                                            
                                                            
                                                            (2,086
                                                            )
                                                            
                                                            
                                                            (1,594
                                                            )Operating
      income
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            5,487
                                                            
                                                            
                                                            
                                                            4,748
                                                            
                                                            
                                                            
                                                            8,014
                                                            
                                                            
                                                            
                                                            7,062Other
      income, net
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            578
                                                            
                                                            
                                                            
                                                            88
                                                            
                                                            
                                                            
                                                            725
                                                            
                                                            
                                                            
                                                            293Interest
      income
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            -
                                                            
                                                            
                                                            
                                                            142
                                                            
                                                            
                                                            
                                                            55
                                                            
                                                            
                                                            
                                                            149Interest
      expense
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            (378
                                                            )
                                                            
                                                            
                                                            (246
                                                            )
                                                            
                                                            
                                                            (747
                                                            )
                                                            
                                                            
                                                            (533
                                                            )Income
      before income taxes
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            5,687
                                                            
                                                            
                                                            
                                                            4,732
                                                            
                                                            
                                                            
                                                            8,048
                                                            
                                                            
                                                            
                                                            6,971Income
      taxes expenses
                                                            
                                                            
                                                            4
                                                            
                                                            
                                                            
                                                            (770
                                                            )
                                                            
                                                            
                                                            (578
                                                            )
                                                            
                                                            
                                                            (1,125
                                                            )
                                                            
                                                            
                                                            (906
                                                            )Net
      income
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            4,917
                                                            
                                                            
                                                            
                                                            4,154
                                                            
                                                            
                                                            
                                                            6,923
                                                            
                                                            
                                                            
                                                            6,065Other
      comprehensive incomeForeign
      currency translation adjustment
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            24
                                                            
                                                            
                                                            
                                                            38
                                                            
                                                            
                                                            
                                                            24
                                                            
                                                            
                                                            
                                                            264Comprehensive
      income
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            4,941
                                                            
                                                            
                                                            
                                                            4,192
                                                            
                                                            
                                                            
                                                            6,947
                                                            
                                                            
                                                            
                                                            6,329Shares
                                                            
                                                            
                                                            Shares
                                                            
                                                            
                                                            Shares
                                                            
                                                            
                                                            SharesEarnings
      per shareWeight
      average number of common stock outstanding-
      basic and diluted
                                                            
                                                            
                                                            3
                                                            
                                                            
                                                            
                                                            50,000,000
                                                            
                                                            
                                                            
                                                            50,000,000
                                                            
                                                            
                                                            
                                                            50,000,000
                                                            
                                                            
                                                            
                                                            50,000,000US$
                                                            
                                                            
                                                            US$
                                                            
                                                            
                                                            US$
                                                            
                                                            
                                                            US$Net
      income per share of common stock outstanding-
      basic and diluted
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            0.10
                                                            
                                                            
                                                            
                                                            0.08
                                                            
                                                            
                                                            
                                                            0.14
                                                            
                                                            
                                                            
                                                            0.12
 
 The
condensed consolidated financial statements should be read in conjunction with
the accompanying notes.
  F-1
  Chisen
Electric Corporation
 
 Unaudited
Condensed Consolidated Balance Sheets
 As of
September 30, 2009 and March 31, 2009
 
 (Audited)As of
                          September 30,
                          2009
                        
                        
                        As of
                          March 31,
                          2009Note
                        
                        
                        US$’000
                        
                        
                        US$’000ASSETSCurrent
      assets:Cash
      and cash equivalents
                        
                        
                        
                        
                        
                        7,418
                        
                        
                        
                        2,620Restricted
      bank balances
                        
                        
                        5
                        
                        
                        
                        23,693
                        
                        
                        
                        13,878Other
      financial assets
                        
                        
                        6
                        
                        
                        
                        5,077
                        
                        
                        
                        1,314Accounts
      receivable, net
                        
                        
                        
                        
                        
                        
                        48,450
                        
                        
                        
                        35,023Other
      receivables
                        
                        
                        
                        
                        
                        
                        1,124
                        
                        
                        
                        842Prepayments
                        
                        
                        
                        
                        
                        
                        2,144
                        
                        
                        
                        862Due
      from related parties
                        
                        
                        14(b)
                        
                        
                        
                        176
                        
                        
                        
                        474Inventories
                        
                        
                        7
                        
                        
                        
                        21,673
                        
                        
                        
                        17,135Total
      current assets
                        
                        
                        
                        
                        
                        
                        109,755
                        
                        
                        
                        72,148Available-for-sale
      financial assets
                        
                        
                        8
                        
                        
                        
                        879
                        
                        
                        
                        878Long-term
      land lease prepayments, net
                        
                        
                        
                        
                        
                        
                        602
                        
                        
                        
                        608Property,
      plant and equipment, net
                        
                        
                        9
                        
                        
                        
                        5,659
                        
                        
                        
                        5,315Deposit
      for acquisition of land and buildings
                        
                        
                        
                        
                        
                        
                        1,463
                        
                        
                        
                        -Total
      assets
                        
                        
                        
                        
                        
                        
                        118,358
                        
                        
                        
                        78,949
 
 The
condensed consolidated financial statements should be read in conjunction with
the accompanying notes.
  F-2
  Chisen
Electric Corporation
 
 Unaudited
Condensed Consolidated Balance Sheets
 As of
September 30, 2009 and March 31, 2009
 
 (Audited)As of
                              September 30,
                              2009
                            
                            
                            As of
                              March 31,
                              2009Note
                            
                            
                            US$’000
                            
                            
                            US$’000LIABILITIES
      AND STOCKHOLDERS’ EQUITYCurrent
      liabilities:Accounts
      payable
                            
                            
                            
                            
                            
                            16,210
                            
                            
                            
                            11,176Notes
      payable
                            
                            
                            10
                            
                            
                            
                            35,685
                            
                            
                            
                            23,343Accrued
      expenses and other liabilities
                            
                            
                            
                            
                            
                            
                            5,506
                            
                            
                            
                            3,769Due
      to related parties
                            
                            
                            14(b)
                            
                            
                            
                            319
                            
                            
                            
                            639Income
      taxes payable
                            
                            
                            
                            
                            
                            
                            770
                            
                            
                            
                            264Short-term
      bank borrowings
                            
                            
                            11
                            
                            
                            
                            33,638
                            
                            
                            
                            20,451Total
      current liabilities
                            
                            
                            
                            
                            
                            
                            92,128
                            
                            
                            
                            59,642Government
      subsidies
                            
                            
                            12
                            
                            
                            
                            162
                            
                            
                            
                            186Deferred
      tax liabilities
                            
                            
                            
                            
                            
                            
                            460
                            
                            
                            
                            460Total
      non-current liabilities
                            
                            
                            
                            
                            
                            
                            622
                            
                            
                            
                            646Total
      liabilities
                            
                            
                            
                            
                            
                            
                            92,750
                            
                            
                            
                            60,288Commitments
      and contingencies
                            
                            
                            15
                            
                            
                            
                            
                            
                            
                            
                            -Stockholders’
      equity:Preferred
      stock, US$0.001 per value:10,000,000 shares authorized
      and no shares issued and outstanding
                            
                            
                            
                            
                            
                            
                            -
                            
                            
                            
                            -Common
      stock, US$0.001 par value:100,000,000
      shares authorized50,000,000
      shares issued and outstanding
                            
                            
                            1
                            
                            
                            
                            50
                            
                            
                            
                            50Capital
      reserves
                            
                            
                            
                            
                            
                            
                            144
                            
                            
                            
                            144Statutory
      reserves
                            
                            
                            
                            
                            
                            
                            1,806
                            
                            
                            
                            1,103Accumulated
      other comprehensive income
                            
                            
                            
                            
                            
                            
                            972
                            
                            
                            
                            948Retained
      earnings
                            
                            
                            
                            
                            
                            
                            22,636
                            
                            
                            
                            16,416Total
      stockholders’ equity
                            
                            
                            
                            
                            
                            
                            25,608
                            
                            
                            
                            18,661Total
      liabilities and stockholders’ equity
                            
                            
                            
                            
                            
                            
                            118,358
                            
                            
                            
                            78,949
 
 The
condensed consolidated financial statements should be read in conjunction with
the accompanying notes.
  F-3
  Chisen
Electric Corporation
 
 Unaudited
Condensed Consolidated Statements of Changes in Stockholders'
Equity
 For the
period from April 1, 2009 to September 30, 2009
 
 Common
      stock issuedNumber
                    of
      shares
                  
                  
                  Amount
                  
                  
                  Capital
                    reserves
                  
                  
                  Statutory
                    reserves
                  
                  
                  Accumulated
                    other
                    comprehensive
                    income
                  
                  
                  Retained
                    earnings
                  
                  
                  TotalUS$’000
                  
                  
                  US$’000
                  
                  
                  US$’000
                  
                  
                  US$’000
                  
                  
                  US$’000
                  
                  
                  US$’000Balance
      as of April 1, 2009
                  
                  
                  50,000,000
                  
                  
                  
                  50
                  
                  
                  
                  144
                  
                  
                  
                  1,103
                  
                  
                  
                  948
                  
                  
                  
                  16,416
                  
                  
                  
                  18,661Net
      income
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  6,923
                  
                  
                  
                  6,923Transfer
      to statutory reserves
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  703
                  
                  
                  
                  -
                  
                  
                  
                  (703
                  )
                  
                  
                  -Foreign
      currency translation adjustment
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  24
                  
                  
                  
                  -
                  
                  
                  
                  24Balance
      as of September 30, 2009
                  
                  
                  50,000,000
                  
                  
                  
                  50
                  
                  
                  
                  144
                  
                  
                  
                  1,806
                  
                  
                  
                  972
                  
                  
                  
                  22,636
                  
                  
                  
                  25,608
 
 The
condensed consolidated financial statements should be read in conjunction with
the accompanying notes.
  F-4
  Chisen
Electric Corporation
 
 Unaudited
Condensed Consolidated Statements of Cash Flows
 For the
six months ended September 30, 2009 and 2008
 
 Six months ended September 30,2009
                        
                        
                        2008US$’000
                        
                        
                        US$’000Cash
      flows from operating activitiesNet
      income
                        
                        
                        6,923
                        
                        
                        
                        6,065Adjustments
      to reconcile net income to net cash provided by operating
      activities:Depreciation of property, plant
      and equipment
                        
                        
                        270
                        
                        
                        
                        205Written-off of property, plant
      and equipment
                        
                        
                        6
                        
                        
                        
                        47Amortization of long-term land
      lease prepayments
                        
                        
                        6
                        
                        
                        
                        6Exchange
      differences
                        
                        
                        147
                        
                        
                        
                        184Provision for warranty
      costs
                        
                        
                        44
                        
                        
                        
                        (305
                        )Government grant
      recognized
                        
                        
                        (24
                        )
                        
                        
                        (24
                        )Changes
      in assets and liabilities:Other financial
      assets
                        
                        
                        (3,761
                        )
                        
                        
                        3,230Accounts receivable,
      net
                        
                        
                        (13,386
                        )
                        
                        
                        (12,965
                        )Other
    receivables
                        
                        
                        (281
                        )
                        
                        
                        118Prepayment
                        
                        
                        (1,281
                        )
                        
                        
                        159Due from related
      parties
                        
                        
                        299
                        
                        
                        
                        798Inventories
                        
                        
                        (4,518
                        )
                        
                        
                        (2,299
                        )Accounts
payable
                        
                        
                        5,020
                        
                        
                        
                        3,008Notes payable
                        
                        
                        12,314
                        
                        
                        
                        13,129Accrued expenses and other
      liabilities
                        
                        
                        1,732
                        
                        
                        
                        705Due to related
      parties
                        
                        
                        (321
                        )
                        
                        
                        (1,367
                        )Income taxes
      payable
                        
                        
                        507
                        
                        
                        
                        460Net
      cash provided by operating activities
                        
                        
                        3,696
                        
                        
                        
                        11,154Cash
      flows from investing activitiesPurchase
      of property, plant and equipment
                        
                        
                        (657
                        )
                        
                        
                        (801
                        )Additions
      of long-term land lease prepayments
                        
                        
                        -
                        
                        
                        
                        (113
                        )Investment
      in restricted bank balances, net
                        
                        
                        (9,798
                        )
                        
                        
                        -Deposit
      paid for acquisition of land and buildings
                        
                        
                        (1,463
                        )
                        
                        
                        -Net
      cash used in investing activities
                        
                        
                        (11,918
                        )
                        
                        
                        (914
                        )Cash
      flows from financing activitiesProceeds
      from short-term bank loans
                        
                        
                        23,839
                        
                        
                        
                        4,376Repayment
      of short-term bank loans
                        
                        
                        (10,676
                        )
                        
                        
                        -Proceeds
      from bills financing, net
                        
                        
                        -
                        
                        
                        
                        (11,670
                        )Net
      cash provided by (used in) financing activities
                        
                        
                        13,163
                        
                        
                        
                        (7,294
                        )Net
      increase in cash and cash equivalents
                        
                        
                        4,941
                        
                        
                        
                        2,946Cash
      and cash equivalents, beginning of period
                        
                        
                        2,620
                        
                        
                        
                        786Effect
      on exchange rate changes
                        
                        
                        (143
                        )
                        
                        
                        (131
                        )Cash
      and cash equivalents, end of period
                        
                        
                        7,418
                        
                        
                        
                        3,601Supplemental
      disclosure of cash flow informationInterest
      paid
                        
                        
                        704
                        
                        
                        
                        711Tax
      paid
                        
                        
                        550
                        
                        
                        
                        451Non-cash
      investing activityPurchase
      of property, plant and equipment recorded as payable to
      contractors
                        
                        
                        43
                        
                        
                        
                        133
 
 The
condensed consolidated financial statements should be read in conjunction with
the accompanying notes.
  F-5
  Chisen
Electric Corporation
 
 Notes
to and Forming Part of
 Unaudited
Condensed Consolidated Financial Statements
 For the
six months ended September 30, 2009
 1.           ORGANIZATION
AND PRINCIPAL ACTIVITIES
 
 Chisen
Electric Corporation (“Chisen Electric”), formerly known as World Trophy
Oufitters, Inc., was formed as a Nevada corporation on January 13, 2005. Its
common stocks are currently trading on the Over-The-Counter Bulletin Board under
the symbol “CIEC”.
 
 Chisen
Electric is an investment holding company with no operations. The principal
activities of its subsidiaries (together with Chisen Electric, collectively
referred as “the Company”) are the manufacture and sales of sealed lead-acid
battery products and investment holding.
 
 Details
of Chisen Electric’s subsidiaries as of September 30, 2009 are as
follows:
 
 Name
                            Place and
                              date of
                              establishment /
                              incorporation
                            
                            Percentage of
                              effective equity
                              interest / voting
                              right attributable
                              to the Company
                            
                            Principal activitiesFast
      More Limited (“Fast More”)
                            Hong
      Kong
                              December
      17, 2007
                            
                            
                            100
                            %
                            Investment
      holdingChangxing
      Chisen Battery
                              Co.,
      Limited (“Changxing Chisen”) *
                            Zhejiang,
                              the
      People’s Republic of China (“PRC”)
                              February
      25, 2002
                            
                            
                            100
                            %
                            Manufacture
      and sales of sealed lead-acid battery productsChisen
      Technology Holdings Corporation (“Chisen Technology”)
                            Nevada,
      United States
                              May
      18, 2009
                            
                            
                            100
                            %
                            Inactive
 
 *
              This is a direct translation
      of the name in Chinese for identification purpose only and is not the
      official name in English.
 
 On
November 12, 2008, Chisen Electric entered into a Share Exchange Agreement
(“Exchange”) with Fast More, Cheer Gold Development Limited (“Cheer Gold”) and
Floster Investment Limited (Floster Investment Limited and together with Cheer
Gold, the “Stockholders”) whereby Chisen Electric acquired all of the issued and
outstanding common stock of Fast More from the Stockholders in exchange for the
issuance by Chisen Electric to the Stockholders of an aggregate 35,000,000
newly-issued shares of Chisen Electric’s common stock, par value of US$0.001
each, representing 70% of Chisen Electric’s common stock issued and outstanding
upon completion of the share exchange (the “Share Exchange
Transaction”).
 
 Prior to
the closing of the Share Exchange Transaction, Chisen Electric implemented a 3
for 1 forward stock split, resulting to the increase of Chisen Electric’s common
stock issued and outstanding from 11,219,400 shares to 33,658,200 shares,
immediately before the completion of the Share Exchange
Transaction.
  F-6
  Chisen
Electric Corporation
 
 Notes
to and Forming Part of
 Unaudited
Condensed Consolidated Financial Statements
 For the
six months ended September 30, 2009
  1.           ORGANIZATION
AND PRINCIPAL ACTIVITIES (CONTINUED)
 
 Upon the
completion of the Share Exchange Transaction (including, but not limited to, the
cancellation of the 18,658,200 shares of Chisen Electric’s common stock
concurrent and simultaneous with the consummation of the Share Exchange
Transaction) on November 12, 2008, there were 50,000,000 shares of Chisen
Electric’s common stock issued and outstanding.
 
 The
acquisition by Chisen Electric of Fast More is deemed to be a reverse
acquisition in accordance with generally accepted accounting principles. In
accordance with the Accounting and Financial Reporting Interpretations and
Guidance prepared by the staff of the U.S. Securities and Exchange Commission,
Chisen Electric (the legal acquirer) is considered the accounting acquiree and
Fast More (the legal acquiree) is considered the accounting acquirer. The
consolidated financial statements of the consolidated entity will in substance
be those of Fast More, with the assets and liabilities, and revenues and
expenses, of Chisen Electric being included effective from the date of
completion of Share Exchange Transaction. Chisen Electric is deemed to be a
continuation of business of Fast More. The outstanding common stock of Chisen
Electric prior to the Share Exchange Transaction will be accounting for at their
net book value and no goodwill will be recognized.
 
 In order
to rationalize the corporate structure and prepare for the Share Exchange
Transaction, Fast More and Changxing Chisen (collectively referred to as “the
Fast More Group”) underwent a reorganization (“Reorganization”) prior to the
consummation of the Share Exchange Transaction.
 
 Since the
ultimate beneficial owner of the companies now comprising the Fast More Group
was, all the time prior to the completion of the Reorganization, Mr. Xu Ke
Cheng, the ownership transfer transaction was accounted for as a transfer of
entities under common control in accordance with the FASB Accounting Standards
Codification (“ASC”) Topic 805 “Business Combinations”. Hence, the consolidation
has been accounted for at historical cost and prepared on the basis as if the
Reorganization had become effective as of the beginning of the first period
presented in the accompanying consolidated financial
statements.
  F-7
  Chisen
Electric Corporation
 
 Notes
to and Forming Part of
 Unaudited
Condensed Consolidated Financial Statements
 For the
six months ended September 30, 2009
 
 2.           PREPARATION
OF INTERIM FINANCIAL STATEMENTS
  Basis
of presentations
 The
accompanying unaudited condensed consolidated financial statements as of
September 30, 2009 have been prepared based upon Securities and Exchange
Commission rules that permit reduced disclosure for interim periods and include,
in the opinion of management, all adjustments (consisting of normal recurring
adjustments and reclassifications) necessary to present fairly the financial
position, results of operations and cash flows as of September 30, 2009 and for
all periods presented.
  Certain
information and footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principles in the
United States of America (“USGAAP”) have been condensed or omitted. These
condensed consolidated financial statements should be read in conjunction with
the audited financial statements and notes thereto included in the Chisen
Electric's Form 10-K filed on June 29, 2009 for the year ended March 31, 2009.
The results of operations for both the three months and six months ended
September 30, 2009 and 2008 are not necessarily indicative of the operating
results to be expected for the full year.
  The
condensed consolidated financial statements and accompanying notes are presented
in United States dollars and prepared in conformity with USGAAP which requires
management to make certain estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of financial statements and the reported amounts of
revenues and expenses during the reporting period. Actual results could differ
from those estimates.
  Basis
of consolidation
 The
      consolidated financial statements include the financial information of
      Chisen Electric and its subsidiaries. All significant intercompany
      accounts and transactions have been eliminated upon
      consolidation.
 
 Recently
issued accounting pronouncements
 In June
2009, the FASB issued ASC Topic 105, “the FASB Accounting Standards
Codification” (“Codification”). Codification would become the source of
authoritative US GAAP recognized by the FASB to be applied by nongovernmental
entities. Once the Codification is in effect, all of its content could carry the
same level of authority. The Codification becomes effective for interim and
annual periods ending on or after September 15, 2009. The Company adopted the
Codification in the second quarter of fiscal 2010. The adoption of the
Codification did not have an effect on the Company’s financial position and
results of operations. However, because the Codification completely replaces
existing standards, it affects the way U.S. GAAP is referenced within the
consolidated financial statements and accounting policies.
  F-8
  Chisen
Electric Corporation
 
 Notes
to and Forming Part of
 Unaudited
Condensed Consolidated Financial Statements
 For the
six months ended September 30, 2009
 
 2.           PREPARATION
OF INTERIM FINANCIAL STATEMENTS
 
 Recently
issued accounting pronouncements (Continued)
 In June
2009, the FASB issued SFAS No. 166, Accounting for Transfers of Financial Assets
– an amendment of FASB Statement No.140.  SFAS 166 requires entities
to provide more information about sales of securitized financial assets and
similar transactions, particularly if the seller retains some risk to the
assets.  The statement eliminates the concept of a qualifying
special-purpose entity, changes the requirements for the de-recognition of
financial assets, and calls upon sellers of the assets to make additional
disclosures about them.  SFAS 166 is effective as for an entity’s
first annual reporting period that begins after November 15,
2009.  The Company does not expect that the adoption of SFAS 166 will
have a material impact on its financial statements.
 
 June
2009, the FASB issued SFAS No. 167, Amendments to FASB Interpretation No.
46(R).  SFAS 167 amends Interpretation No.46(R) to require enhanced
disclosures that will provide users of financial statements with more
transparent information about an enterprise’s involvement in a variable interest
entity.  SFAS 167 is effective for an entity’s first fiscal period
that begins after November 15, 2009.  The Company does not expect that
the adoption of SFAS 167 will have a material impact on its financial
statements.
 
 3.           EARNINGS
PER SHARE
 
 Basic
earnings per share is computed by dividing income available to common
stockholders by the weighted-average number of common stocks outstanding during
the year. Diluted earnings per share is computed similar to basic earnings per
share except that the denominator is increased to include the number of
additional common stocks that would have been outstanding if the potential
common shares had been issued and if the additional common shares were dilutive.
There were no potentially dilutive securities for both the three months and six
months ended September 30, 2009 and 2008.
 
 Upon the
completion of the Share Exchange Transaction, the number of Chisen Electric’s
common stock issued and outstanding, taken into account of the 3 for 1 forward
split as detailed in note 1 was increased to 50,000,000 shares and was applied
retrospectively for the calculation of earnings per share.
  F-9
  Chisen
Electric Corporation
 
 Notes
to and Forming Part of
 Unaudited
Condensed Consolidated Financial Statements
 For the
six months ended September 30, 2009
 
 4.
              INCOME
      TAXES
 
 Chisen
Electric had a net operating loss carry-forward for income tax reporting
purposes that might be offset against future taxable income. These net operating
loss carry-forwards are severely limited when Chisen Electric experiences a
change in control.  Therefore, following the Exchange as mentioned in
Note 1 in November 2008, the amount available to offset future taxable income is
limited. No tax benefit has been reported in the financial statements, because
Chisen Electric believes that it is more-likely-than-not that the carry-forwards
will finally expire and therefore cannot be used.  Accordingly, the
potential tax benefits of the loss carry-forwards are offset by a valuation
allowance of the same amount.
 
 Chisen
Electric’s subsidiaries are subject to income taxes on an entity basis on income
arising in or derived from the tax jurisdictions in which each entity domiciles
and operates.
 
 Hong Kong
Profits Tax has not been provided as Fast More had no assessable profit for the
period.
 
 Changxing
Chisen is subject to state and local enterprise income taxes in the PRC at a
standard rate of 25%. Changxing Chisen received official designation by the
local tax authority as a foreign invested enterprise engaged in manufacturing
activities and is confirmed by the local tax authority that it is exempted from
enterprise income tax for two years commencing from the first profitable year in
2006, followed by a 50% reduction for the next three years.
 
 Dividends
payable by a foreign invested enterprise in the PRC to its foreign investors in
Hong Kong are subject to a 5% withholding tax.
 
 (a)
              Income
      tax expenses are comprised of the
following:
 
 Three months ended
                                          September 30
                                        
                                        Six months ended
                                          September 302009
                                        
                                        2008
                                        
                                        2009
                                        
                                        2008US$’000
                                        
                                        US$’000
                                        
                                        US$’000
                                        
                                        US$’000Current
      taxes arising in the PRC:-
      For the period
                                        
                                        770
                                        
                                        578
                                        
                                        1,125
                                        
                                        906
  The FASB
Accounting Standards Codification Topic 740, “Accounting for Uncertainty in
Income Taxes – an interpretation of FASB Statement No. 109” (“ASC 740”) issued
by the FASB clarifies the accounting and disclosure for uncertainty in tax
positions, as defined, and prescribes the measurement process and a minimum
recognition threshold for a tax position, taken or expected to be taken in a tax
return, that is required to be met before being recognized in the financial
statements. Under ASC 740, the Company must recognize the tax benefit from an
uncertain position only if it is more-likely-than-not the tax position will be
sustained on examination by the taxing authority, based on the technical merits
of the position. The tax benefits recognized in the financial statements
attributable to such position are measured based on the largest benefit that has
a greater than 50% likelihood of being realized upon the ultimate resolution of
the position.
  F-10
  Chisen
Electric Corporation
 
 Notes
to and Forming Part of
 Unaudited
Condensed Consolidated Financial Statements
 For the
six months ended September 30, 2009
 
 4. INCOME
TAXES (CONTINUED)
  (a)
              (continued)
  Subject
to the provision of ASC 740, the Company has analyzed its filing positions in
all of the domestic and foreign jurisdictions where it is required to file
income tax returns. As of September 30, 2009, the Company has identified the
following jurisdictions as “major” tax jurisdictions, as defined, in which it is
required to file income tax returns: United States, Hong Kong and the PRC. Based
on the evaluations noted above, the Company has concluded that there are no
significant uncertain tax positions requiring recognition in its consolidated
financial statements.
  As of
September 30, 2009, the Company had no unrecognized tax benefits or accruals for
the potential payment or interest and penalties. The Company’s policy is to
record interest and penalties in this connection as a component of the provision
for income tax expense. For the six months ended September 30, 2009 and 2008, no
interest or penalties were recorded.
  (b)
              Reconciliation
      from the expected income tax expenses calculated with reference to the
      statutory tax rate in the PRC of 25% (2008: 25%) is as
      follows:
 
 Three months ended
                          September 30
                        
                        
                        Six months ended
                          September 302009
                        
                        
                        2008
                        
                        
                        2009
                        
                        
                        2008US$’000
                        
                        
                        US$’000
                        
                        
                        US$’000
                        
                        
                        US$’000Expected
      income tax expenses
                        
                        
                        1,422
                        
                        
                        
                        1,183
                        
                        
                        
                        2,012
                        
                        
                        
                        1,742Effect
      on tax incentives / holiday
                        
                        
                        (761
                        )
                        
                        
                        (616
                        )
                        
                        
                        (1,092
                        )
                        
                        
                        (904
                        )Non-deductible
      items
                        
                        
                        99
                        
                        
                        
                        47
                        
                        
                        
                        172
                        
                        
                        
                        66Others
                        
                        
                        10
                        
                        
                        
                        (36
                        )
                        
                        
                        33
                        
                        
                        
                        2Income
      tax expenses
                        
                        
                        770
                        
                        
                        
                        578
                        
                        
                        
                        1,125
                        
                        
                        
                        906
 
 5.           RESTRICTED
BANK BALANCES
 
 Restricted
bank balances as of September 30, 2009 and March 31, 2009 represented
time deposits with original maturity between three and twelve months. As of
September 30, 2009 and March 31, 2009, all restricted bank balances were pledged
for the issue of notes payable as disclosed in Note 10 below.
  F-11
  Chisen
Electric Corporation
 
 Notes
to and Forming Part of
 Unaudited
Condensed Consolidated Financial Statements
 For the
six months ended September 30, 2009
 
 6.
              OTHER
      FINANCIAL ASSETS
 
 Other
financial assets represented notes receivable from customers for the settlement
of accounts receivable balances. As of September 30, 2009 and March
31, 2009, all notes receivable were guaranteed by established banks in the
PRC and had maturities of 6 months or less from the date of issue.
  7.           INVENTORIES
  (Audited)As of
                        September 30,
                        2009
                      
                      
                      As of
                        March 31,
                        2009Inventories consisted of the following:
                      
                      US$’000
                      
                      
                      US$’000Raw
      materials
                      
                      
                      5,384
                      
                      
                      
                      4,269Work-in-progress
      and semi-finished goods
                      
                      
                      8,966
                      
                      
                      
                      9,370Finished
      goods
                      
                      
                      7,323
                      
                      
                      
                      3,49621,673
                      
                      
                      
                      17,135
 
 8.           AVAILABLE-FOR-SALE
FINANCIAL ASSETS
 
 Available-for-sale
      financial assets as of September 30, 2009 and March 31, 2009 represented
      investment in unlisted equity securities and are recorded at cost. The
      management has estimated that the recoverable amount of the assets exceed
      their carrying value.
 
 9.           PROPERTY,
PLANT AND EQUIPMENT, NET
  (Audited)As of
                        September 30,
                        2009
                      
                      
                      As of
                        March 31,
                        2009Property,
      plant and equipment is summarized as follows:
                      
                      US$’000
                      
                      
                      US$’000Buildings
                      
                      
                      2,661
                      
                      
                      
                      2,632Plant
      and machinery
                      
                      
                      2,828
                      
                      
                      
                      2,386Motor
      vehicles
                      
                      
                      801
                      
                      
                      
                      807Furniture,
      fixtures and office equipment
                      
                      
                      558
                      
                      
                      
                      427Construction-in-progress
                      
                      
                      383
                      
                      
                      
                      3657,231
                      
                      
                      
                      6,617Accumulated
      depreciation
                      
                      
                      (1,572
                      )
                      
                      
                      (1,302
                      )5,659
                      
                      
                      
                      5,315
  F-12
  Chisen
Electric Corporation
 
 Notes
to and Forming Part of
 Unaudited
Condensed Consolidated Financial Statements
 For the
six months ended September 30, 2009
 
 9.           PROPERTY,
PLANT AND EQUIPMENT, NET (CONTINUED)
 
 Depreciation
expenses were US$138,000 and US$105,000 for the three months ended September 30,
2009 and 2008, respectively, and US$270,000 and US$206,000 for the six months
ended September 30, 2009 and 2008, respectively.
 
 The
Company has pledged certain buildings as collateral against general banking
facilities granted to Changxing Chisen, details of which are disclosed in Note
11.
 
 10.         NOTES
PAYABLE
 
 All notes
payable issued by the Company were interest-free, guaranteed by banks, repayable
within six months from date of issue and collateralized by restricted bank
balances as set out in Note 5 and certain land lease prepayments and buildings
as set out in Note 11 below.
 
 In
addition, various parties have issued guarantees against these notes payable as
follows:
 
 (Audited)As of
                        September 30,
                        2009
                      
                      
                      As of
                        March 31,
                        2009US$’000
                      
                      
                      US$’000Corporate
      and personal guarantees issued by related parties (Note
    14(d))
                      
                      
                      10,969
                      
                      
                      
                      8,034Corporate
      guarantees issued by third parties
                      
                      
                      2,925
                      
                      
                      
                      2,922
  11.         SHORT-TERM
BANK BORROWINGS
  Short-term
bank loans represent amounts due to various banks which are due within 12
months, and these loans can normally be renewed with the banks upon
expiry/maturity.
  The loans
and the notes payable as set out in note 10 are collateralized by land lease
prepayments and buildings of the Company with carrying values as
follows:
  (Audited)As
      of
                        September
      30,
                        2009
                      
                      
                      As
      of
                        March
      31,
                        2009US$’000
                      
                      
                      US$’000Land
      use rights
                      
                      
                      603
                      
                      
                      
                      608Buildings
                      
                      
                      2,009
                      
                      
                      
                      2,0692,612
                      
                      
                      
                      2,677
  F-13
  Chisen
Electric Corporation
 
 Notes
to and Forming Part of
 Unaudited
Condensed Consolidated Financial Statements
 For the
six months ended September 30, 2009
  11.         SHORT-TERM
BANK BORROWINGS (CONTINUED)
  Various
parties have also issued guarantees against these short-term bank loans as
follows:
  (Audited)As
      of
                        September
      30,
                        2009
                      
                      
                      As
      of
                        March
      31,
                        2009US$’000
                      
                      
                      US$’000Corporate
      and personal guarantees issued by related parties (Note
    14(d))
                      
                      
                      29,250
                      
                      
                      
                      16,069Corporate
      guarantees issued by third parties
                      
                      
                      2,779
                      
                      
                      
                      4,381
  The
weighted average annual interest rates of the short-term bank loans were 5.53%
and 7.9% as of September, 30 2009 and March 31, 2009, respectively.
  12.
              GOVERNMENT
      SUBSIDIES
 
 During
the year ended March 31, 2008, the Company received a government grant of
approximately US$231,000 for the purpose of subsidising its acquisition of
property, plant and equipment, of which approximately US$12,000 and US$12,000
was credited to the statement of operations for the three months ended September
30, 2009 and 2008, respectively, and US$24,000 and US$24,000 were credited to
the statements of operations for the six months ended September 30, 2009 and
2008, respectively.
 
 13.         FINANCIAL
INSTRUMENTS
 
 The
carrying amounts of cash and cash equivalents, restricted bank balances, other
financial assets, accounts receivable and payable, deposits, prepayment and
other receivables, notes payable, accrued expenses and other liabilities, amount
due from/to related parties and short-term borrowings are assumed to approximate
their fair value due to the short-term maturity of these balances.
  F-14
  Chisen
Electric Corporation
 
 Notes
to and Forming Part of
 Unaudited
Condensed Consolidated Financial Statements
 For the
six months ended September 30, 2009
 
 14.         RELATED
PARTY TRANSACTIONS
  (a) Names
and relationship of related parties:
 
 Name of related party
                  
                  Existing relationships with the
      CompanyMr.
      Xu Kecheng
                  
                  Director
      and controlling stockholder of Chisen ElectricZhejiang
      Chisen Glass Company Limited (“Chisen Glass”)*
                  
                  A
      company controlled by a close family member of Mr. Xu
    KechengMr.
      Xu Keyong
                  
                  A
      close family member of Mr. Xu KechengMs.
      Zhou Fang Qin
                  
                  Spouse
      of Mr. Xu KechengChangxing
      Chisen Xinguangyuan Company Limited (“Xinguangyuan”)*
                  
                  A
      company controlled by a close family member of Mr. Xu
    KechengZhejiang
      Ai Ge Organism Products Company Limited (“Ai Ge
Organism”)*
                  
                  A
      company controlled by Mr. Xu KechengZhejiang
      Changxing Nuo Wan Te Ke Glass Company Limited (“Nuo Wan Te
      Ke”)*
                  
                  A
      company controlled by a close family member of Mr. Xu
    KechengZhejiang
      Changxing Ruilang Electronic Company Limited (“Ruilang
      Electronic”)*
                  
                  A
      company controlled by a close family member of Mr. Xu
    Kecheng
  *
              These
      are direct translations of the name in Chinese for identification purpose
      only and are not official names in
English.
  (b)   Summary
of balances with related parties:
 (Audited)As
      of
                        September
      30,
                        2009
                      
                      
                      As
      of
                        March
      31,
                        2009US$’000
                      
                      
                      US$’000Due
      from related parties:Ms.
      Zhou Fang Qin
                      
                      
                      87
                      
                      
                      
                      195Chisen
      Glass
                      
                      
                      88
                      
                      
                      
                      278Xinguangyuan
                      
                      
                      1
                      
                      
                      
                      1176
                      
                      
                      
                      474Due
      to related parties:Mr.
      Xu Keyong
                      
                      
                      24
                      
                      
                      
                      24Ai
      Ge Organism
                      
                      
                      292
                      
                      
                      
                      602Nuo
      Wan Te Ke
                      
                      
                      3
                      
                      
                      
                      13319
                      
                      
                      
                      639
  All
amounts due from / to related parties represent unsecured advances which are
interest-free and repayable on demand.
  F-15
  Chisen
Electric Corporation
 
 Notes
to and Forming Part of
 Unaudited
Condensed Consolidated Financial Statements
 For the
six months ended September 30, 2009
  14.           RELATED
PARTY TRANSACTIONS (CONTINUED)
  (c)       Summary
of related party transactions:
 
 Name of
                                    related party
                                  
                                  Nature of
                                    transactions
                                  
                                  Three months ended
                                    September 30
                                  
                                  
                                  Six months ended
                                    September 302009
                                  
                                  
                                  2008
                                  
                                  
                                  2009
                                  
                                  
                                  2008US$’000
                                  
                                  
                                  US$’000
                                  
                                  
                                  US$’000
                                  
                                  
                                  US$’000Chisen
      Glass
                                  
                                  Acquisition
      of motor vehicle
                                  
                                  
                                  -
                                  
                                  
                                  
                                  -
                                  
                                  
                                  
                                  -
                                  
                                  
                                  
                                  160Ruilang
      Electronic
                                  
                                  Deposit
      paid for acquisition and land buildings (Note)
                                  
                                  
                                  1,462
                                  
                                  
                                  
                                  -
                                  
                                  
                                  
                                  1,462
                                  
                                  
                                  
                                  -
 
 Note:
 In
September 2009, the Company entered into an agreement with Ruilang Electronic
for the acquisition of land and buildings at a consideration of US$2,925,000
(equivalent to RMB20,000,000). A deposit of US$1,463,000 was paid to Ruilang
Electronic in September 2009 and the remaining balance of US$1,462,000 will be
paid upon transfer of title of the land and buildings.
 
  (d)      Other
arrangements:
  ..
                As
      of September 30, 2009, US$10,676,000 of the Company’s short-term bank
      loans was collateralized by a guarantee provided by Chisen
      Glass.
  ..
                As
      of September 30, 2009, US$2,486,000 of the Company’s short-term bank loans
      was collateralized by land use rights owned by Ruilang
      Electronic.
  ..
                As
      of September 30, 2009, Chisen Glass, Mr. Xu Kecheng and Ms. Zhou Fang Qin
      provided guarantees, in the aggregate, amounting to US$5,850,000 to secure
      the notes payable of the
Company.
  ..
                As
      of September 30, 2009, Xinguangyuan and Mr. Xu Kecheng provided
      guarantees, in aggregate, amounting to US$5,850,000 and US$2,925,000 to
      secure the short-term bank loans and notes payable of the Company,
      respectively.
  ..
                As
      of September 30, 2009, Xinguangyuan provided guarantees, in aggregate,
      amounting to US$1,463,000 and US$2,194,000 to secure the short-term bank
      loans and notes payable of the Company,
  respectively.
  ..
                As
      of September 30, 2009, Xinguangyuan, Mr. Xu Kecheng and a third party
      provided guarantees, in aggregate, amounting to US$8,775,000 to secure the
      short-term bank loans of the
Company.
  F-16
  Chisen
Electric Corporation
 
 Notes
to and Forming Part of
 Unaudited
Condensed Consolidated Financial Statements
 For the
six months ended September 30, 2009
  15.         COMMITMENTS
AND CONTINGENCIES
 
 (a)
              Operating
      lease commitments
 
 The
following table summarizes the approximate future minimum rental payments under
non-cancelable operating leases in effect as of September 30, 2009 and March 31,
2009:
 
 (Audited)As of
                            September 30,
                            2009
                          
                          
                          As of
                            March 31,
                            2009US$’000
                          
                          
                          US$’000Within
      one year
                          
                          
                          443
                          
                          
                          
                          185One
      to two years
                          
                          
                          465
                          
                          
                          
                          205Two
      to three years
                          
                          
                          488
                          
                          
                          
                          202Three
      to four years
                          
                          
                          475
                          
                          
                          
                          212Four
      to five years
                          
                          
                          99
                          
                          
                          
                          54Total
                          
                          
                          1,970
                          
                          
                          
                          858
 
 (b)
              Capital
      commitments
 
 As of
September 30, 2009 and March 31, 2009, the Company had capital expenditure
commitments for construction projects and purchase of fixed assets of
approximately US$1,462,000 and US$423,000, respectively.
  F-17
  Chisen
Electric Corporation
 
 Notes
to and Forming Part of
 Unaudited
Condensed Consolidated Financial Statements
 For the
six months ended September 30, 2009
 
 16.         PROVISION
FOR WARRANTY
 
 Estimated
warranty costs are recognised at the time when the Company sells its products
and are included in sales, marketing and distribution expenses. The Company uses
historical failure rates and costs to repair product defects during the warranty
period to estimate the provision for warranty costs. The provision made is
reviewed periodically in light of actual experience. The reconciliation of the
changes in the warranty obligation is as follows:
  Three months ended
                  September 30
                
                
                Six months ended
                  September 302009
                
                
                2008
                
                
                2009
                
                
                2008US$’000
                
                
                US$’000
                
                
                US$’000
                
                
                US$’000Beginning
      balance
                
                
                147
                
                
                
                291
                
                
                
                121
                
                
                
                413Exchange
      realignment
                
                
                -
                
                
                
                1
                
                
                
                1
                
                
                
                1Accrual
      for warranties issued during the period
                
                
                65
                
                
                
                151
                
                
                
                105
                
                
                
                421Utilised
      during the period
                
                
                (20
                )
                
                
                (329
                )
                
                
                (35
                )
                
                
                (721
                )Closing
      balance
                
                
                192
                
                
                
                114
                
                
                
                192
                
                
                
                114
  17.         RETIREMENT
PLAN COSTS
 
 Contributions
to defined contribution retirement schemes are charged to general and
administrative expenses in the consolidated statements of operations and other
comprehensive income as and when the related employee services are provided.
Retirement plan costs were US$66,000 and US$32,000 for the three months ended
September 30, 2009 and 2008, respectively, and US$238,000 and US$64,000 for the
six months ended September 30, 2009 and 2008, respectively.
 
 18.         SEGMENTAL
INFORMATION
 
 During
the three months and six months ended September 30, 2009 and 2008, all revenue
of the Company represented income from sales of sealed lead-acid battery and
therefore no financial information by business segment is presented.
Furthermore, as all income is derived from the PRC, no geographical segment is
presented.
 
 19.         SUBSEQUENT
EVENTS
 
 In
      accordance with the provision of the FASB Accounting Standards
      Codification topic 855 issued by the FASB, the Company has evaluated all
      events or transactions that occurred after September 30, 2009 up through
      November 14, 2009 , the date the Company issued these unaudited condensed
      consolidated financial statements. During this period the Company did not
      have any material subsequent events that impacted the Company’s unaudited
      condensed consolidated financial
statements.
  F-18





ITEM
2. MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION




Forward
Looking Statements




The following discussion of our
financial condition and results of operations of Chisen Electric Corporation
(formerly known as World Trophy Outfitters, Inc., and the term “World Trophy” is used
when discussing the operations of the Company prior to November 12, 2008 and the
“Registrant”
when discussing its operations after November 12, 2008) is based upon and should
be read in conjunction with our consolidated financial statements and their
related notes included in this report. This report contains forward-looking
statements. Generally, the words “believes”, “anticipates”, “may”, “will”,
“should”, “expect”, “intend”, “estimate”, “continue” and similar expressions or
the negative thereof or comparable terminology are intended to identify
forward-looking statements. Such statements are subject to certain risks and
uncertainties, including the matters set forth in this report or other reports
or documents we file with the SEC from time to time, which could cause actual
results or outcomes to differ materially from those projected. Undue reliance
should not be placed on these forward-looking statements which speak only as of
the date hereof. We undertake no obligation to update these forward-looking
statements.





Exchange
Agreement





On November 12, 2008 (the “Closing Date”), World
Trophy entered into a Share Exchange Agreement (the “Exchange Agreement”)
with Fast More Limited, a Hong Kong investment holding company (“Fast More”), Cheer
Gold Development Limited, a company organized under the laws of Samoa (“Cheer Gold”) and
Floster Investment Limited, a company organized under the laws of Samoa (“Floster” and together
with Cheer Gold, the “Stockholders”). As a
result of the share exchange, the World Trophy acquired all of the issued and
outstanding securities of Fast More from the Stockholders in exchange for
Thirty-Five Million (35,000,000) newly-issued shares of the World Trophy’s
common stock, par value $0.001 per share (“Common Stock”), of
which Thirty-Two Million Nine Hundred Thousand (32,900,000) shares were issued
to Cheer Gold and Two Million One Hundred Thousand (2,100,000) shares were
issued to Floster. As of the Closing Date, the Stockholders collectively
beneficially own seventy percent (70%) of the voting capital stock of the
Company, 65.8% of which is owned by Cheer Gold and 4.2% of which is owned by
Floster. As a result of the Exchange, Fast More became a wholly-owned subsidiary
of World Trophy.





Effective February 2, 2009, the
Registrant amended its Articles of Incorporation to change its name from “World
Trophy Outfitters, Inc.” to “Chisen Electric Corporation”. The following is
disclosure regarding the Registrant, Fast More and Fast More’s wholly-owned and
chief operating subsidiary, Changxing Chisen Electric Co., Ltd. (hereinafter
referred to as “Chisen” or “CCEC”, and together
with Fast More and the Registrant, the “Company”), the
principal business activities of which consist of the manufacture and sale of
sealed lead-acid battery products primarily in the electric bicycle
market.





Prior
Operations of World Trophy





World Trophy was formed as a Nevada
corporation on January 13, 2005, and had been in the business of selling big
game hunting packages to high end clients who sought to hunt with the top tier
big game outfitters.  Its main product sold was hunting trips, which
included the hunting license and guide fees.  World Trophy purchased and
resold several hunting trips, selling them at a profit or for a mark-up. World
Trophy also provided incidental advisory services to purchasers of hunting trips
by helping these clients select an appropriate hunt, with no additional fees
charged for these services.





During the year ended March 31, 2008,
World Trophy sold its entire inventory of big game hunts, but was unsuccessful
in developing a profitable business.  World Trophy ceased its operations
and became a development stage company effective April 1, 2008. Prior to the
Exchange, World Trophy focused its efforts on seeking a business opportunity and
had been in the process of locating and negotiating with business entities for
the merger of a target company into World Trophy.




The Registrant’s Common Stock is
currently traded on the Over-The-Counter Bulletin Board (“OTCBB”) under the
symbol “CIEC”. Immediately prior to the Exchange, World Trophy was considered a
“blank check” development stage company with US$51,039 in assets and a net loss
of US$(27,977) for the three (3) months ended September 30, 2008.  On the
Closing Date, the Registrant did not have any liabilities.


3





Current
Operations of the Company




Fast More
is an investment holding company incorporated in Hong Kong on December 17, 2007
with limited liability. CCEC was founded in Huzhou, Zhejiang Province, The
People’s Republic of China (also referred to herein as the “PRC”) in 2002 with
registered capital of RMB1,000,000 (approximately US$124,452). On February 16,
2008, Fast More acquired the 51%, 9% and 40% equity interests in Chisen from Mr.
Xu Kecheng, Mr. Xu Keyong and BEME International Co., Ltd., respectively, for
RMB6,502,500 (approximately US$926,000), RMB1,147,500 (approximately US$164,000)
and RMB 5,100,000 (approximately US$726,000), respectively. Upon the completion
of these acquisition transactions, CCEC became the wholly-owned and chief
operating subsidiary of Fast More. On December 4, 2008, it resolved to increase
the registered capital from RMB 1,000,000 to RMB 50,000,000 (approximately
US$7,353,000).





Since the
ultimate beneficial owner of Fast More was, at all times, the substantial
stockholder of CCEC (Mr. Xu Kecheng), the ownership transfer transaction was
accounted for as a transfer of entities under common control in accordance with
the FASB Accounting Stardards Codification (“ASC”) Topic 805.




Fast More has authorized capital of
HK$10,000 (approximately US$1,282) divided into Ten Thousand (10,000) common
shares authorized at HK$1.00 each, Ten Thousand (10,000) of which are currently
issued and outstanding and held by the Registrant as a result of the Exchange.
World Trophy acquired 9,400 of these shares from Cheer Gold and 600 of these
shares from Floster. Xu Hua serves as theSole Director of Fast
More and is a Chinese citizen. Fast More’s registered office is located at Room
1401, 14/F, World Commerce Centre Harbour City, 7-11 Canton Road TST, Hong
Kong.





On May 18, 2009, the Company
incorporated Chisen Technology Holdings Corporation in Nevada as its
wholly-owned subsidiary.  Chisen Technology Holdings Corporation is
authorized to do business in the State of Washington and as of November 16,
2009, this entity has no operations.





Summary
of the Company’s Current Business




The
Company is a leading lead-acid motive battery producer in China's personal
transportation device market. Our motive battery products are sold under our own
brand name and are predominantly used in electric bicycles and distributed and
sold in China. Electric bicycles become increasingly popular. Among all types of
battery for electric bicycles, the lead-acid motive battery is the preferred
choice for electric bicycle manufacturers in China because of its cost
efficiency.




Today,
the Company manufactures over 15,000,000 batteries each year, has more than
2,000 employees and is one of China's largest manufacturers of lead-acid
batteries for electric-powered bicycles (LABEBs). For each of the Company’s
fiscal years ended March 31, 2009and2008, sales revenues were US$109,020,000and
US$65,387,000, respectively, and our net income during the same periods amounted
to US$8,880,000and US$6,701,000, respectively.  Sales revenues were
US$79,867,000and US$57,813,000 for the six (6)
months ended September 30, 2009 and 2008, respectively, and our net income
during the same periods amounted to US$6,923,000and US$6,065,000,
respectively.




The
Company is located at Changxing Economic Development Zone at the bank of the
Taihu Lake in Zhejiang Province, in close proximity to major national
transportation systems, including National Highways 104 and 318, the Shanghai –
Jiangsu – Zhejiang – Anhui – Hangzhou – Nanjing Expressway, the Changxing –
Huzhou – Shanghai Channel, the Xuancheng – Hangzhou Railway and the Xinyi –
Changxing Railway. The Company’s corporate offices are located at Jingyi Road,
Changxing Economic Development Zone, Changxing, Zhejiang Province, The People’s
Republic of China.




The
Company’s Products




Description
of our Lead-Acid Motive Batteries




The key
components of a lead-acid motive battery include electrode plates and fiberglass
dividing plates. The electrode plates are coated with oxidized lead and alloy
lead. Pairs of positively charged electrode plates and negatively charged
electrode plates each separated by a fiberglass dividing plate are bound
together by metal strip and installed into the plastic casing of a lead-acid
motive battery. The battery is then filled with sulfuric acid and charged with
electricity. The number and the size of electrode plates required to be
installed in a lead-acid motive battery will depend on the required level of its
storage capacity and the power output.




We
produce and offer nine (9) models of lead-acid motive battery products for sale
and are mainly engaged in the production of the following models of lead-acid
motive battery products for electric bicycles:


4





Product
                    
                    Dimentions (LxWxH)
                    
                    Weight
                      (kg)
                    
                    
                    Power
                      Output
                      (w)
                    
                    
                    Estimated
                      Hours
                      Required
                      Per
                      Charging
                      (1)
                    
                    
                    Estimated
                      Minutes
                      of Use
                      Per
                      Charging
                      (min)(2)
                    
                    
                    Estimated
                      Travel
                      Distance Per
                      Charging (km)6-DZM-10Ah
                    
                    151×99×98
                    
                    
                    4.2
                    
                    
                    
                    60
                    
                    
                    
                    10
                    h
                    
                    
                    135-145
                    
                    
                    
                    45-506-DZM-12Ah
                    
                    151×99×102
                    
                    
                    4.3
                    
                    
                    
                    72
                    
                    
                    
                    10
                    h
                    
                    
                    120-130
                    
                    
                    
                    45-506-DZM-16Ah
                    
                    151×99×118
                    
                    
                    5.6
                    
                    
                    
                    96
                    
                    
                    
                    10
                    h
                    
                    
                    120-130
                    
                    
                    
                    50-606-DZM-17Ah
                    
                    181×76×166
                    
                    
                    6.3
                    
                    
                    
                    102
                    
                    
                    
                    10
                    h
                    
                    
                    120-130
                    
                    
                    
                    50-606-DZM-20Ah
                    
                    181×76×170
                    
                    
                    7.0
                    
                    
                    
                    120
                    
                    
                    
                    10
                    h
                    
                    
                    120-130
                    
                    
                    
                    60-708-DZM-18Ah
                    
                    250×100×128
                    
                    
                    9.0
                    
                    
                    
                    144
                    
                    
                    
                    10
                    h
                    
                    
                    120-130
                    
                    
                    
                    60-708-DZM-20Ah
                    
                    250×100×128
                    
                    
                    9.05
                    
                    
                    
                    160
                    
                    
                    
                    10
                    h
                    
                    
                    120-130
                    
                    
                    
                    60-706-DZM-24Ah
                    
                    175×165×125
                    
                    
                    9.5
                    
                    
                    
                    144
                    
                    
                    
                    10
                    h
                    
                    
                    120-130
                    
                    
                    
                    70-806-DZM-25Ah
                    
                    250×78×118
                    
                    
                    8.85
                    
                    
                    
                    150
                    
                    
                    
                    10
                    h
                    
                    
                    120-130
                    
                    
                    
                    70-80





(1)
Estimated hours required per charging refers to the estimated number of hours
required for charging the battery from nil to full storage
capacity.




(2)
Estimated hours of use per charging refer to the estimated maximum number of
hours for which the battery is able to be used on each occasion when it is
charged to its full storage capacity.





All the
lead-acid motive battery products produced by us are re-chargeable and can be
recharged approximately 500 times. They are standardized and can be used in
electric bicycles, electric motorcycles and electric cars produced by different
manufacturers.





Pictures
of Our Products




6-DZM-10AH
            
            6-DZM-12AH





6-DZM-16AH
            
            6-DZM-17AH


5





6-DZM-20AH
            
            8-DZM-18AH/8-DZM-20AH6-DZM-24AH
            
            6-DZM-25AH




Distribution
Methods




We sell our lead-acid motive battery
products principally to manufacturers of electric bicycles. However, with the
growing retail market for replacement of battery products, i.e. our secondary
market, we have also strengthened our efforts in the sales of battery products
to sales representatives and exclusive distributors which are strategically
located in 27 provinces, autonomous regions and directly-administered
municipalities in China. Chisen currently has exclusive sales agreements with
distributors at the provincial and county level, and employs sales
representatives in each province across China to help distributors to further
distribute products from counties to towns. We have established and maintained
long-term relationships with distributors who we believe have local business
experience and established regional sales networks.  Our largest
distributors are located in Zhumadian, Henan Province, Tangshan, Hebei Province,
Haimen, Jiangsu Province and Yancheng, Jiangsu Province.




Market Share




Zhejiang
is the main province of producing LABEBs, the output of which accounted for
approximately half of the total domestic output of LABEBs in China. According to
the China Battery Industry Association, in 2008, total output of the top ten
(10) enterprises operating in Zhejiang accounted for approximately 50 million
LABEBs of the approximate 100 million sold across China in the personal
transportation market. According to market research results of Adfaith
Consulting Co., Ltd., for the year ended March 31, 2009, our sales of lead-acid
battery products in China represented approximately 6% of the total market size
(in terms of sales revenue) of the lead-acid motive battery products for
electric bicycles in China.


6





The table
below shows the three (3) top manufacturers of LABEBs in China, and their
revenues during fiscal year ended March 31, 2009:




Battery Manufacturer
                      
                      Production Location
                      
                      Revenues in 2009
                        (approximate)
                        US$(Million)
                      
                      Market ShareTianneng
      Power International
                      
                      Changxing,
      Zhejiang
                      
                      
                      376.97
                      
                      22
                      %Zhejiang
      Chaowei Power Co., Ltd.
                      
                      Changxing,
      Zhejiang
                      
                      
                      222.69
                      
                      13
                      %CHISEN
                      
                      Changxing,
      Zhejiang
                      
                      
                      109.02
                      
                      6
                      %




Revenues
generated by the Company in China accounted for 100% of the Company’s revenues
in the fiscal years ended March 31, 2009 and 2008 and 100% of the Company’s
revenues for the periods ended September 30, 2009 and 2008.




In the
calendar year ended December 31, 2008, Chisen’s battery production reached 7
million. In the calendar year ending December 31, 2009, we believe that Chisen’s
battery production will reach between 12 and 13 million.





Competitive
Business Conditions and Market Trends




We believe that in the next several
years, due to the intensifying global environmental concerns, there will be
increased development of the electric bicycle. At present, due to the fact that
the use of electric bicycles is very much in line with the energy-saving and
environmental protection policy initiated by the Chinese government, the
development of electric vehicles won its support. The electric bicycle, as an
environment-friendly and convenient personal transportation vehicle, bears the
advantages of convenience, non-pollution, safety and less energy. According to
market research results of Adfaith Consulting Co., Ltd., during the five years
from 2004 to 2008, the market sales of electric vehicles in China tripled, with
the number of electric vehicles totally amounting to 67,700,000 in 2008. In
accordance with the measured data of the electric vehicle market demand in
China, it is estimated that the market demand of electric vehicle will exceed
138,000,000 in 2013.





With respect to new product trends in
the market, Europe, the United States and Japan use primarily a lithium battery
whereas India and most of the countries of Southeast Asia use primarily a
lead-acid battery. In 2008, according to the industry magazine Business
E-Bicycle, approximately 90% of the electric bikes in China used lead-acid
motive battery products. However, with technological advancements, it is a
general market trend to develop motive battery products that are more
environmentally friendly with increased power output and less weight. There can
be no assurance that manufacturers of electric bikes will continue to use
lead-acid motive battery products as the principal source of motive power for
electric bikes. In the event that the market prefers to use other forms of
battery products and if we are not able to develop new motive battery products
to meet the future demand, our business could be adversely
affected.




In 2008, the top electric bicycle brand
in terms of production was Xinri, followed by Yadea, Taimei, Supaiqi, Lvyuan,
Aucma, Bidewen and Hongdu. Each of these companies is a relatively small
enterprise. We believe that continued industrial integration and brand
concentration will continue to increase and that these famous brands will
rapidly increase their market share.  We also believe that brands will
become more diversified by an increasing influence of well-known brands on the
market. Chisen has established long-term strategic relationships with important
electric bicycle manufacturers, including Xinri, Yadea, Taimei, Supaiqi. Xinri’s
electric bicycle was honored to serve at the Beijing 2008 Olympic Games and at
the Paralympic Games, and Chisen was chosen as the only manufacturer to supply
environmentally friendly batteries to Xinri for its electric bicycle. Based on
this, in the next several years, we will strive to create an international
first-class brand and become the leader in providing “green” energy in the
electric bicycle marketplace. Simultaneously, through constant research and
development of new chemical energy technologies, we believe Chisen will provide
energy-savings and highly-effective energy solutions to our customers for the
purpose of improving the quality of human life and a sustainable ecological
environment.




Competition




Our chief competitors are Tianneng
Power International Ltd. (“Tianneng”) and
Zhejiang Chaowei Power Co., Ltd (“Chaowei”). These
companies were the first into the battery industry. For example, Tianneng ranks
first in terms of sales volume, and its capital stock is listed on The Stock
Exchange of Hong Kong Limited. Taige Power Supply Co., Ltd. and Xinnuoli Power
Supply Co., Ltd., as the OEM customers of Tianneng, were separated from Tianneng
and officially set up their own brands in 2008, which has since somewhat
impacted the capabilities of Tianneng and the overall industry competition
structure.


7





Chaowei has a lot of after-sales
service stores. However, Tianneng and Chaowei also do not have close cooperation
with any of the top electric bicycle manufacturers in China. Although Chisen
entered into its battery industry later than some of its competitors, Chisen has
achieved success in establishing long-term strategic cooperation with a top
electric bicycle manufacturer. The Company has established long-term strategic
cooperation with many famous electric bicycle manufacturers in China, such as
Xinri, Yadea, Taimei, Xinkelin and Lvyuan.




Cooperative
Partnership




In April 2008, CCEC set up the Zhejiang
Changxing Chisen Physical-Chemical Power Supply Research and Development Center
at the College of Chemistry and Chemical Engineering at Xiamen University in
order to research and develop new products. Xiamen University is a first class
comprehensive University in China with 9 graduate schools, 120 research
institutions and cooperative inter-university ties to over 100 institutions
worldwide. A copy of Chisen’s Agreement with the Research and Development Center
is referenced hereto as Exhibit 10.1.





Chisen has established long-term
strategic relationships with important electric bicycle manufacturers, including
Xinri, Yadea, Taimei, Supaiqi.  The Company also established strategic
cooperation partnership with suppliers and vendors by means of supply chain
integration to control procurement cost and quality. Moreover, a supplier’s
assessment system has been set up to ensure the quality stability of direct
materials.





Development
Strategy of the Company




With a leading position in the LABEB
battery product market in China, our product research and development capability
and our cooperative partnership, we believe we are well positioned to capture
additional business opportunities in China's personal transportation device
market. In light of those prevailing economic trends of developing alternative
transportation devices, aiming to reduce the reliance on oil and gas and
producing less emissions, we intend to explore the motive battery market for
electric-powered motorcycles and electric cars. Leveraging our experience and
expertise in producing lead-acid motive battery products for electric bicycles,
our product mix has been expanded to include lead-acid back-up batteries,
Lithium iron motive batteries, Lithium iron back-up battery products and
complementary electrical equipment, such as chargers, controllers and motors,
for different types of personal transportation devices. It is our goal to become
the largest battery developer producer with a first-class sales and service
network in China.





The top
five (5) lead-acid motive battery manufacturers in 2008 accounted for 45% of the
total market share with the Company, representing approximately 6% of the total
market share, taking the third place in this industry.  The Company
has taken the following measures to set up its position as one of the leaders in
the industry: (a) the Company invested in an automatic production line with the
maximum daily production capacity increasing by 120% compared with that in
2008; (b) the Company is actively seeking an acquisition target to expand
its market share and develop its production capacity.





Results
of Operations for the Six (6) Months Ended September 30, 2009 Compared with the
Six (6) Months Ended September 30, 2008




The
following table sets forth a summary of certain key components of our results of
operations for the periods indicated, in dollars and as a percentage of
revenues.




For The Six (6) Months Ended September 30 (Unaudited)2009
                  
                  
                  2008
                  
                  
                  2009
                  
                  
                  2008Revenues
                  
                  $
                  79,867,000
                  
                  
                  $
                  57,813,000
                  
                  
                  
                  100.00
                  %
                  
                  
                  100.00
                  %Cost
      of sales
                  
                  $
                  65,813,000
                  
                  
                  $
                  46,715,000
                  
                  
                  
                  82.40
                  %
                  
                  
                  80.80
                  %Gross
      income
                  
                  $
                  14,054,000
                  
                  
                  $
                  11,098,000
                  
                  
                  
                  17.60
                  %
                  
                  
                  19.20
                  %Sales,
      marketing and distribution
                  
                  $
                  3,953,000
                  
                  
                  $
                  2,442,000
                  
                  
                  
                  4.95
                  %
                  
                  
                  4.22
                  %General
      and administrative expenses
                  
                  $
                  2,086,000
                  
                  
                  $
                  1,594,000
                  
                  
                  
                  2.61
                  %
                  
                  
                  2.76
                  %Operating
      income
                  
                  $
                  8,015,000
                  
                  
                  $
                  7,062,000
                  
                  
                  
                  10.04
                  %
                  
                  
                  12.22
                  %Other
      income, net
                  
                  $
                  725,000
                  
                  
                  $
                  293,000
                  
                  
                  
                  0.91
                  %
                  
                  
                  0.51
                  %Interest
      Income
                  
                  $
                  55,000
                  
                  
                  $
                  149,000
                  
                  
                  
                  0.07
                  %
                  
                  
                  0.26
                  %Net
      Income from Operations before Interest and Tax Expenses
                  
                  $
                  8,794,000
                  
                  
                  $
                  7,504,000
                  
                  
                  
                  11.01
                  %
                  
                  
                  12.98
                  %Interest
      expenses
                  
                  $
                  692,000
                  
                  
                  $
                  384,000
                  
                  
                  
                  0.87
                  %
                  
                  
                  0.66
                  %Income
      before income taxes
                  
                  $
                  8,048,000
                  
                  
                  $
                  6,971,000
                  
                  
                  
                  10.08
                  %
                  
                  
                  12.06
                  %Income
      taxes expenses
                  
                  $
                  1,125,000
                  
                  
                  $
                  906,000
                  
                  
                  
                  1.41
                  %
                  
                  
                  1.57
                  %Net
      income
                  
                  $
                  6,923,000
                  
                  
                  $
                  6,065,000
                  
                  
                  
                  8.67
                  %
                  
                  
                  10.49
                  %Other
      comprehensive income
                  
                  $
                  24,000
                  
                  
                  $
                  264,000
                  
                  
                  
                  0.03
                  %
                  
                  
                  0.46
                  %Comprehensive
      income
                  
                  $
                  6,947,000
                  
                  
                  $
                  6,329,000
                  
                  
                  
                  8.70
                  %
                  
                  
                  10.95
                  %


8





Revenues





Revenues
for the six (6) months ended September 30, 2009 and 2008 were US$79,867,000 and
US$57,813,000, respectively. The increase in revenues of 38% was mainly
attributable to the continuing strong sales of our battery products as a result
of rapid growth in the electric bicycle market in the PRC. Sales volume
increased by 78% was mainly due to the increase of demands from customers. On
the other hand, there was a decrease in average unit selling price by
approximately 25% in response to the decrease in major raw material costs. The
effect of the decrease in average selling price was offset by the significant
increase in sales volume.  As such, overall sales increased by
38%.  For the total year outlook, the trend of cost variations on the
major direct materials and ongoing competitions would continue for the remaining
year.  As such, we expect that the average selling price would
continue the current trend of fluctuation.




Cost
of Sales





Cost of
sales for the six (6) months ended September 30, 2009 and 2008 was US$65,813,000
and US$46,715,000, respectively, and cost rates were 82.4% and 80.8%,
respectively. As the effect of decrease in average selling price was only
partially offset by the effect on decrease in average cost of materials, the
gross income rate decreased by 1.6%. These were resulted from the restriction of
the whole pricing system of the battery industry.





Depreciation
and Amortization





Depreciation
expense was US$270,000 and US$205,000 for the six (6) months period ended
September 30, 2009 and 2008, respectively. The increase in depreciation expense
was mainly attributable to the new machines and equipments acquired during the
twelve (12) months period form October 1, 2008 to September 30, 2009 for which
the same depreciation method applied.





Sales,
Marketing and Distribution





Sales, marketing and distribution were
US$3,953,000 and US$2,442,000for the six (6) months
period ended September 30, 2009 and 2008, respectively.  The increase
of US$1,511,000 was mainly driven by the increases in transportation expenses,
advertising expenses, sales commission, staff salaries, after-sale related
expenses and travelling expenses by US$370,000, US$151,000, US$447,000,
US$264,000, US$128,000 and US$149,000, respectively.





General
and Administrative Expenses





General
and administrative expenseswere US$2,086,000 and
US$1,594,000for
the six (6) months period ended September 30, 2009 and 2008, respectively, and
mainly consisted of staff salaries, staff welfare, social security
contributions, depreciation expenses, research and development expenses, legal
and professional fees, other taxes and motor vehicle expenses. The increase in
general and administrative expenses was mainly due to increases in employees’
salaries and compensation and social security contribution of approximately
US$314,000 and US$207,000, respectively,  which were driven by the
increase in number of staff and the salary rate.





Other
Income, Net





Net other
income was US$725,000 and US$293,000 for the six (6) month period ended
September 30, 2009 and 2008, respectively. The increase of US$432,000 was mainly
attributable to the increase in government subsidies and sales of raw
materials.





Net
Income from Operations before Interest and Tax Expenses




Net
income from operations before interest and tax expense was US$8,794,000 and
US$7,504,000, for the six (6) month period ended September 30, 2009 and 2008,
respectively. The increase of US$1,290,000 was mainly attributable to the
increase in sales volume, thus resulting in an increase in the gross income for
the six (6) months period ended September 30, 2009.





Interest
Expense, Net





Net
interest expensewas US$692,000 and
US$384,000for the
six (6) month period ended September 30, 2009 and 2008, respectively. Net
interest expense increased by US$308,000 during these periods due to the
combined result of the increase of interest expense from the addition of short
term bank loans, as well as the decrease of the interest income from restricted
bank balance for the six (6) month period ended September 30, 2009, compared to
the six (6) month period ended September 30, 2008.


9





Net
Income





Net income was US$6,923,000 and
US$6,065,000for
the six (6) month period ended September 30, 2009 and 2008, respectively. The
increase in net incomeof US$858,000 was mainly
attributable to the continuing strong sales of our battery
products.





Results
of Operations for the Three (3) Months Ended September 30, 2009 Compared with
the Three (3) Months Ended September 30, 2008




The
following table sets forth a summary of certain key components of our results of
operations for the periods indicated, in dollars and as a percentage of
revenues.




For The Three (3) Months Ended September
       30 (Unaudited)2009
                
                
                2008
                
                
                2009
                
                
                2008Revenues
                
                $
                50,392,000
                
                
                $
                35,588,000
                
                
                
                100.00
                %
                
                
                100.00
                %Cost
      of sales
                
                $
                41,708,000
                
                
                $
                28,521,000
                
                
                
                82.77
                %
                
                
                80.14
                %Gross
      income
                
                $
                8,684,000
                
                
                $
                7,067,000
                
                
                
                17.23
                %
                
                
                19.86
                %Sales,
      marketing and distribution
                
                $
                2,167,000
                
                
                $
                1,337,000
                
                
                
                4.30
                %
                
                
                3.76
                %General
      and administrative expenses
                
                $
                1,030,000
                
                
                $
                982,000
                
                
                
                2.04
                %
                
                
                2.76
                %Operating
      income
                
                $
                5,487,000
                
                
                $
                4,748,000
                
                
                
                10.89
                %
                
                
                13.34
                %Other
      income, net
                
                $
                578,000
                
                
                $
                88,000
                
                
                
                1.15
                %
                
                
                0.25
                %Interest
      Income
                
                $
                0
                
                
                $
                142,000
                
                
                
                0
                %
                
                
                0.40
                %Net
      Income from Operations before Interest and Tax Expenses
                
                $
                6,065,000
                
                
                $
                4,978,000
                
                
                
                12.04
                %
                
                
                13.99
                %Interest
      expenses
                
                $
                378,000
                
                
                $
                246,000
                
                
                
                0.75
                %
                
                
                0.69
                %Income
      before income taxes
                
                $
                5,687,000
                
                
                $
                4,732,000
                
                
                
                11.29
                %
                
                
                13.30
                %Income
      taxes expenses
                
                $
                770,000
                
                
                $
                578,000
                
                
                
                1.53
                %
                
                
                1.62
                %Net
      income
                
                $
                4,917,000
                
                
                $
                4,154,000
                
                
                
                9.76
                %
                
                
                11.67
                %Other
      comprehensive income
                
                $
                24,000
                
                
                $
                38,000
                
                
                
                0.05
                %
                
                
                0.11
                %Comprehensive
      income
                
                $
                4,941,000
                
                
                $
                4,192,000
                
                
                
                9.81
                %
                
                
                11.78
                %




Revenues





Revenues
for the three (3) months ended September 30, 2009 and 2008 were US$50,392,000
and US$35,588,000, respectively. The increase in revenues of 42% was mainly
attributable to the continuing strong sales of our battery products as a result
of rapid growth in the electric bicycle market in the PRC. Sales volume
increased by 80% was mainly due to the increase of demands from customers. On
the other hand, there was a decrease in average unit selling price by
approximately 25% in response to the decrease in major raw material costs such
as the metal lead. The effect of the decrease in average selling price was
offset by the significant increase in sales volume.  As such, overall
sales increased by 42%. For the total year outlook, we expect that the trend of
cost variations on the major direct materials and ongoing competitions would
continue for the remainder of 2009.  As such, we also expect that the
average selling price would continue the current trend of
fluctuation.





Cost
of Sales





Cost of
sales for the three (3) months ended September 30, 2009 and 2008 was
US$41,708,000 and US$28,521,000, respectively, and cost rates were 82.77% and
80.14%, respectively. The unfavorable increase of the cost rates by 2.63% was
mainly due to the decrease of average selling price. The effect of decrease in
average selling price was only partially offset against the effect on decrease
in average cost of materials and the gross income rate decreased by
2.63%




Depreciation
and Amortization




Depreciation
expense was US$138,000 and US$104,000 for the three (3) month period ended
September 30, 2009 and 2008, respectively. The increase in depreciation expense
was mainly attributable to the new machines and equipments acquired during the
twelve (12) months period from October 1, 2008 to September 30, 2009 for which
the same depreciation method applied.


10





Sales,
Marketing and Distribution





Sales, marketing and distribution were
US$2,167,000 and US$1,337,000for the three (3) month
period ended September 30, 2009 and 2008, respectively.  The increase
of US$830,000 was mainly driven by the increases in transportation expenses,
advertising expenses, sales commission, staff salaries, after-sale related
expenses, travelling expense and provision for warranty costs by US$130,000,
US$12,000, US$186,000, US$112,000  US$20,000, US$74,000 and
US$240,000, respectively.





General
and Administrative Expenses





General
and administrative expenseswere US$1,030,000 and
US$982,000for the
three (3) month period ended September 30, 2009 and 2008, respectively, and
mainly consisted of staff salaries, staff welfare, social security
contributions, depreciation expenses, research and development expenses, legal
and professional fees, other taxes and motor vehicle expenses. The increase in
general and administrative expenses was mainly due to increases in employees’
salaries and compensation and social security contribution for an aggregate of
approximately US$97,000, which were driven by the increase in number of staff
and the salary rate, offset by the decrease in research and development expenses
by US$30,000.





Other
Income, Net





Net other
income was US$578,000 and US$88,000 for the three (3) month period ended
September 30, 2009 and 2008, respectively. The increase of US$490,000 was mainly
attributable to the increase in government subsidies and the increase in income
from sales of raw materials.





Net
Income from Operations before Interest and Tax Expenses





Net
income from operations before interest and tax expense was US$6,065,000 and
US$4,978,000, for the three (3) month period ended September 30, 2009 and 2008,
respectively. The favorable variance of US$1,087,000 was mainly due to the
favorable gross income increase by US$1,617,000, other income increased by
US$490,000, and offset by increase in sales, marketing, general
and  administrative expenses by US$878,000, thus resulting in an
increase in the gross income for the three (3) month period ended September 30,
2009.





Interest
Expense, Net





Net
interest expensewas US$378,000 and
US$104,000for the
three (3) month period ended September 30, 2009 and 2008, respectively. Net
interest expense increased by US$274,000 during these periods due to the
increase in short term bank loans for the three (3) month period ended September
30, 2009, compared to the three (3) month period ended September 30,
2008.





Net
Income





Net income was US$4,917,000 and
US$4,154,000for
the three (3) month period ended September 30, 2009 and 2008, respectively. The
increase in net incomeof US$763,000 was due to
the favorable increase of income before income taxes by US$955,000 as a result
of the continuing strong sales of our battery products, offset by the
unfavorable increase of the income taxes expenses US$192,000.





Liquidity
and Capital Resources





We generally finance our operations
through operating profit and borrowings from banks.  During the
reporting period, we arranged a number of bank loans to satisfy our financing
needs. As of the date of this report, we have not experienced any difficulty in
raising funds by bank loans, and we have not experienced any liquidity problems
in settling our payables in the normal course of business and repaying our bank
loans when they fall due.


11





The
following table sets forth the summary of our cash flows, in dollar, for the
periods indicated:





Six (6) Months Ended September
      30
                  (Unaudited)2009
                
                
                2008Net
      cash  provided by operating activities
                
                $
                3,410,000
                
                
                $
                10,892,000Net
      cash used in investing activities
                
                $
                (11,918,000)
                
                
                $
                (914,000)Net
      cash provided by(used  in)financing
      activities
                
                $
                13,163,000
                
                
                $
                (7,294,000)Net
      increase  in cash and cash equivalents
                
                $
                4,655,000
                
                
                $
                2,684,000Effect
      of exchange rate changes on cash
                
                $
                143,000
                
                
                $
                131,000Cash
      and cash equivalents at beginning of period
                
                $
                2,620,000
                
                
                $
                786,000Cash
      and cash equivalents at end of period
                
                $
                7,418,000
                
                
                $
                3,601,000





Operating
Activities





Net cash
provided by operating activities was approximately US$3,410,000 for the six (6)
months ended September 30, 2009, as compared to net cash provided by operating
activities of approximately US$10,892,000 for the six (6) months ended September
30, 2008. This decrease was mainly due to the combined result of increase in
account payables and the increasing use of bank bills for settlement of accounts
payable, offset by the increase in inventories and prepayments to raw materials
suppliers.





Investing
Activities





Net cash
used in investing activities were approximately US$11,918,000 for the six (6)
months ended September 30, 2009, as compared to approximately US$914,000 for the
six (6) months ended September 30, 2008. The increase was mainly due to the
increase of security deposits for issuing bank acceptance bill and a deposit
paid for acquisition of land and buildings.




Financing
Activities





Net cash
provided by financing activities was approximately US$13,163,000 for the six (6)
months ended September 30, 2009, as compared to net cash used in financing
activities of approximately US$7,294,000 for the six (6) months ended September
30, 2008. The increase was mainly due to the addition of short-term bank
borrowings.





Working
Capital





Our
working capital increased by approximately US$5,121,000 to approximately
US$17,627,000 as of September 30, 2009, as compared to the working capital of
approximately US$12,506,000 as of March 31,2009.  This increase is
primarily due to an increase in our cash and cash equivalents, restricted bank
balances, other financial assets, account receivables, prepayments and
inventories approximately US$37,623,000, offset by an increase in our
short-term bank loans, accounts payable, notes payable, accrued expenses
and other liabilities of approximately US$32,300,000. The
increase in accounts receivable was the result of the increase of sales
volume. The increase in inventories was mainly due to the increase of the
finished goods. The increase in short-term bank loans and notes payable was the
result of our financing arrangement.





Off-Balance Sheet
Arrangements




We do not have any outstanding
derivative financial instruments, off-balance sheet guarantees, interest rate
swap transactions of foreign currency forward contracts. Furthermore, we do not
have any retained or contingent interest in assets transferred to an
unconsolidated entity that serves as credit, liquidity or market risk support to
such entity. We do not have any variable interest in an unconsolidated entity
that provides financing, liquidity, market risk or credit support to us or that
engages in leasing, hedging or research and development services with
us.





ITEM
3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK




Interest
Rates Risk




Our
exposure to interest rate risk for changes in interest rates relates primarily
to the interest-bearing bank loans and interest income generated by the bank
deposits. We have not used any derivative financial instruments in our
investment portfolio or for cash management purposes. Interest-earning
instruments carry a degree of interest rate risk. We have not been exposed nor
do we anticipate being exposed to material risks due to changes in interest
rates. Nevertheless, our future interest expense or interest income may expect
to be decreased due to changes in interest rates in the PRC.


12





Foreign
Exchange Rates Risk




We do not hold any derivative
instruments and do not engage in any hedging activities. Because most of our
purchases and sales are made in RMB, any exchange rate change affecting the
value of the RMB relative to the U.S. dollar could have an effect on our
financial results as reported in U.S. dollars. If the RMB were to depreciate
against the U.S. dollar, amounts reported in U.S. dollars would be
correspondingly reduced. If the RMB were to appreciate against the U.S. dollar,
amounts reported in U.S. dollars would be correspondingly
increased.




Contractual
Obligations




Payments Due By PeriodContractual Obligations (US$)
                
                Total
                
                
                Less than
                  1 year
                
                
                1-3
                  years
                
                
                3-5
                  years
                
                
                More than
                  5 yearsBank
      Indebtedness
                
                (SEE
      TABLE BELOW)Other
      Indebtedness
                
                
                0
                
                
                
                0
                
                
                
                0
                
                
                
                0
                
                
                
                0Capital
      Lease Obligations
                
                
                0
                
                
                
                0
                
                
                
                0
                
                
                
                0
                
                
                
                0Operating
      Lease Obligations
                
                (SEE
      TABLE BELOW)Purchase
      Obligations
                
                (SEE
      TABLE BELOW)Other
      Long-Term Liabilities Reflected on the Company’s Balance Sheet under US
      GAAP
                
                
                0
                
                
                
                0
                
                
                
                0
                
                
                
                0
                
                
                
                0Total:
                
                
                0
                
                
                
                0
                
                
                
                0
                
                
                
                0
                
                
                
                0





Bank indebtedness (US$)
                                
                                September 30, 2009
                                
                                
                                March
                                  31, 2009Short-term
      bank borrowings
                                
                                US$33,638,000
                                
                                
                                US$20,451,000Notes
      payable (within (1) year)
                                
                                US$35,685,000
                                
                                
                                US$23,343,000Total
                                
                                US$69,323,000
                                
                                
                                US$43,794,000




Purchase Obligations (US$)
                  
                  September 30, 2009
                  
                  
                  March
                    31, 2009Purchase
      of machineries (within one (1) year)
                  
                  
                  0
                  
                  
                  US$423,000Purchase
      of land and buildings
                  
                  US$1,462,000
                  
                  
                  
                  0Total
                  
                  US$1,462,000
                  
                  
                  US$423,000




Operating Lease Obligations
      (US$)
                
                September 30, 2009
                
                
                March
                  31, 2009Within
      one (1) year
                
                US$443,000
                
                
                US$185,0001-3
      years
                
                US$953,000
                
                
                US$407,0003-5
      years
                
                US$574,000
                
                
                US$266,000Over
      five (5) years
                
                
                -
                
                
                
                -Total
                
                US$1,970,000
                
                
                US$858,000




ITEM
4. CONTROLS AND PROCEDURES




Disclosure
Controls and Procedures




Under the supervision and with the
participation of our management, including our principal executive officer and
principal financial officer, we conducted an evaluation of the effectiveness of
the design and operation of our disclosure controls and procedures, as defined
in Rule 13a-15(e) under the Exchange Act. Based on this evaluation, our
management, including our principal executive officer and our principal
financial officer, concluded that our disclosure controls and procedures were
effective as of the fiscal quarter covered by this report, to ensure that
information required to be disclosed by us in the reports filed or submitted by
us under the Exchange Act (i) is recorded, processed, summarized and
reported within the time period specified in SEC rules and forms, and
(ii) is accumulated and communicated to our management, including our
principal executive officer and our principal financial officer, as appropriate
to allow appropriate decisions on a timely basis regarding required
disclosure.


13





Changes In Internal
Controls




There was
no change in the Company’s internal control over financial reporting that was
identified in connection with such evaluation that occurred during the period
covered by this report that has materially affected, or is reasonably likely to
materially affect, the Company’s internal control over financial
reporting.





PART
II


OTHER
INFORMATION




ITEM
1. LEGAL PROCEEDINGS




In the normal course of business, we
are named as defendant in lawsuits in which claims are asserted against us. In
our opinion, the liabilities, if any, which may ultimately result from such
lawsuits, are not expected to have a material adverse effect on our financial
position, results of operations or cash flows. As of September 30, 2009, there
is no pending or outstanding material litigation with the Company.





ITEM
1A. RISK FACTORS




Not
required for a "smaller reporting company".




ITEM
2. UREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS




During
the quarter ended September 30, 2009, the Company had no unregistered sales of
equity securities.





ITEM
3. DEFAULTS UPON SENIOR SECURITIES




None.





ITEM
4. SUBMISSION OF MATTERS TO A VOTE OF SECURITYHOLDERS




On October 22, 2009, the Company
distributed to all holders of record of the Company’s common stock as of October
7, 2009 a Proxy Statement containing information related to the Annual Meeting
of Stockholders of the Company to be held at the Changxing International Hotel,
No. 1 Taihu Rd., Changxing, Zhejiang Province, The People’s Republic of China on
November 13, 2009, beginning at 10:00 a.m. local time for the purpose of
re-electing the Company’s current seven (7) directors and to ratify the
re-appointment of the Company’s current independent registered public accounting
firm (Mazars CPA Limited) for the fiscal year ending March 31,
2010.  The Company also distributed copies of the Company’s Annual
Report on Form 10-K for the year ended March 31, 2009 and Quarterly Report for
the period ended June 30, 2009.




ITEM
5. OTHER INFORMATION




None.





ITEM
6. EXHIBITS




(a) Exhibits




EXHIBIT
                    NO.
                  
                  DESCRIPTION
                  
                  LOCATION2.1
                  
                  Share
      Exchange Agreement, dated November 12, 2008, by and among World Trophy
      Outfitters, Inc., Fast More Limited, Cheer Gold Development Ltd. and
      Floster Investment Limited
                  
                  Incorporated
      by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K as
      filed with the SEC on November 12, 20083.1
                  
                  Articles
      of Incorporation of World Trophy Outfitters, Inc.
                  
                  Incorporated
      by reference to Exhibit 3(i).1 to the Registrant’s Registration Statement
      on Form SB-2 as filed with the SEC on September 23,
20053.2
                  
                  Certificate
      of Amendment to Articles of Incorporation of Chisen Electric Corporation
      (name change)
                  
                  Incorporated
      by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K as
      filed with the SEC on February 4,
2009


14




3.3
                
                Amended
      and Restated Bylaws of Chisen Electric Corporation
                
                Incorporated
      by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K as
      filed with the SEC on February 4, 2009


3.4
            
            Certificate
      of Incorporation of Fast More Limited, dated December 17,
    2007
            
            Incorporated
      by reference to Exhibit 3.3 to the Company’s Current Report on Form 8-K as
      filed with the SEC on November 12, 20083.5
            
            Memorandum
      and Articles of Association of Fast More Limited, dated as of December 17,
      2007
            
            Incorporated
      by reference to Exhibit 3.4 to the Company’s Current Report on Form 8-K as
      filed with the SEC on November 12, 20083.6
            
            Certificate
      of Incorporation of Changxing Chisen Electric Co., Ltd.
            
            Incorporated
      by reference to Exhibit 3.5 to the Company’s Current Report on Form 8-K as
      filed with the SEC on November 12, 20083.7
            
            Articles
      of Associations of Changxing Chisen Electric Co., Ltd.
            
            Incorporated
      by reference to Exhibit 3.6 to the Company’s Current Report on Form 8-K as
      filed with the SEC on November 12, 200810.1
            
            Agreement
      on Establishment of Changxing Chisen Physical Chemistry Power Research and
      Development Center, dated April 30, 2008
            
            Incorporated
      by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200810.2
            
            Form
      of Labor Contract
            
            Incorporated
      by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200810.3
            
            Lease
      Agreement, dated March 30, 2008, by and between Changxing Chisen Electric
      Co., Ltd. and Changxing Xiangyi Industrial Park Investment Co.,
      Ltd.
            
            Incorporated
      by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200810.4
            
            Contract
      For Loan on Guarantee, by and among Zhejiang Changxing Agricultural
      Cooperative Bank, Changxing Chisen Electric Co., Ltd. and Zhejiang Chisen
      Galss Co., Ltd.
            
            Incorporated
      by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200810.5
            
            Renminbi
      Loan Contract, dated January 11, 2008, by and between Changxing Chisen
      Electric Co., Ltd. and China Construction Bank Corporation (Changxing
      Branch)
            
            Incorporated
      by reference to Exhibit 10.5 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12,
2008




10.6
            
            Renminbi
      Loan Contract, dated April 11, 2008, by and between Changxing Chisen
      Electric Co., Ltd. and China Construction Bank Corporation (Changxing
      Branch)
            
            Incorporated
      by reference to Exhibit 10.6 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200810.7
            
            Renminbi
      Loan Contract, dated March 31, 2008, by and between Changxing Chisen
      Electric Co., Ltd. and Bank of China (Hong Kong) Limited Shanghan
      Branch
            
            Incorporated
      by reference to Exhibit 10.7 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200810.8
            
            Loan
      Contract (Short Term), dated August 15, 2008, by and between Changxing
      Chisen Electric Co., Ltd. and Bank of China Changxing
    Branch
            
            Incorporated
      by reference to Exhibit 10.8 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12,
2008


15





10.9
            
            Acceptance
      Agreement, dated August 25, 2008, by and between Changxing Chisen Electric
      Co., Ltd. and Industrial Bank Co., Ltd. Hangzhou Branch
            
            Incorporated
      by reference to Exhibit 10.9 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200810.10
            
            Acceptance
      Agreement of Commercial Bill, dated September 18, 2008, by and between
      Changxing Chisen Electric Co., Ltd. and China Bank Co., Ltd. Changxing
      Branch
            
            Incorporated
      by reference to Exhibit 10.10 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200810.11
            
            Acceptance
      Agreement of Commercial Bill, dated July 29, 2008, by and between
      Changxing Chisen Electric Co., Ltd. and China Construction Bank Changxing
      Branch Co., Ltd.
            
            Incorporated
      by reference to Exhibit 10.11 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200810.12
            
            Acceptance
      Agreement of Commercial Bill, dated September 9, 2008, by and between
      Changxing Chisen Electric Co., Ltd. and China Construction Bank Changxing
      Branch Co., Ltd.
            
            Incorporated
      by reference to Exhibit 10.12 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200810.13
            
            Components
      Purchase Contract, effective as of January 1, 2008, by and between
      Changxing Chisen Electric Co., Ltd. and Jiansu Xinri Electric Bicycle Co.,
      Ltd.
            
            Incorporated
      by reference to Exhibit 10.13 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200810.14
            
            Supply
      Contract, dated April 22, 2008, by and between Changxing Chisen Electric
      Co., Ltd. and Jiangsu Yadea Science & Technology Development Co.,
      Ltd.
            
            Incorporated
      by reference to Exhibit 10.14 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200810.15
            
            Sales
      Contract of Battery, dated November 10, 2007, by and between Changxing
      Chisen Electric Co., Ltd. and Hu Qinzhong, Yancheng Office
            
            Incorporated
      by reference to Exhibit 10.15 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200810.16
            
            Sales
      Contract of Battery, dated February 17, 2008, by and between Changxing
      Chisen Electric Co., Ltd. and Song Chunwei
            
            Incorporated
      by reference to Exhibit 10.16 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200814.1
            
            Code
      of Ethics
            
            Incorporated
      by reference to Exhibit 14.1 to the Company’s Current Report on Form 8-K
      as filed with the SEC on February 4,
2009




17
              
              Resignation
      of Mathew Evans, dated November 12, 2008
              
              Incorporated
      by reference to Exhibit 17 to the Company’s Current Report on Form 8-K as
      filed with the SEC on November 12, 200821
              
              List
      of Subsidiaries of World Trophy Outfitters, Inc.
              
              Provided
      herewith31.1
              
              Certifications
      of the Chief Executive Officer pursuant to Section 302 of the
      Sarbanes-Oxley Act of 2002
              
              Provided
      herewith31.2
              
              Certifications
      of the Chief Financial Officer pursuant to Section 302 of the
      Sarbanes-Oxley Act of 2002
              
              Provided
      herewith32.1
              
              Certification
      Pursuant To 18 U.S.C. Section 1350, As Adopted Pursuant To Section 906 of
      the Sarbanes-Oxley Act Of 2002
              
              Provided
      herewith32.2
              
              Certification
      Pursuant To 18 U.S.C. Section 1350, As Adopted Pursuant To Section 906 of
      the Sarbanes-Oxley Act Of 2002
              
              Provided
      herewith


16





99.1
            
            Audited
      Consolidated Financial Statements of Fast More Limited and its Subsidiary
      for the Fiscal Years Ended March 31, 2008 and 2007
            
            Incorporated
      by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200899.2
            
            Unaudited
      Condensed and Consolidated Financial Statements of Fast More Limited and
      its Subsidiary for the Three (3) Months Ended June 30, 2008 and
      2007
            
            Incorporated
      by reference to Exhibit 99.2 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200899.3
            
            Unaudited
      Pro Forma Financial Statements of Fast More Limited for the three (3)
      month period ended June 30, 2008 and the two years ended March 31,
      2008.
            
            Incorporated
      by reference to Exhibit 99.3 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200899.4
            
            Audit
      Committee Charter, dated January 15, 2009
            
            Incorporated
      by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K
      as filed with the SEC on February 4, 200999.5
            
            Compensation
      Committee Charter, dated January 15, 2009
            
            Incorporated
      by reference to Exhibit 99.2 to the Company’s Current Report on Form 8-K
      as filed with the SEC on February 4, 200999.6
            
            Corporate
      Governance and Nominating Committee Charter, dated January 15,
      2009
            
            Incorporated
      by reference to Exhibit 99.3 to the Company’s Current Report on Form 8-K
      as filed with the SEC on February 4, 2009


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SIGNATURES




Pursuant
to the requirements of Section 13 or 15 (d) of the Securities Exchange Act of
1934, as amended, the Registrant has duly caused this Quarterly Report on Form
10-Q report to be signed on its behalf by the undersigned, thereunto duly
authorized.


Date: November
      13, 2009
              By:
              /s/ Xu KechengName:
      Xu KechengIts:
      President, Chief Executive Officer and Principal Executive
      Officer




Date: November
      13, 2009
              By:
              /s/He ZhiweiName:
      He ZhiweiIts:
      Chief Financial Officer, Principal Financial and Accounting
      Officer


18