**U.S.      SECURITIES AND EXCHANGE COMMISSION**

**WASHINGTON,      D.C. 20549**

**FORM      10-KSB**

|  o |   | **ANNUAL                REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF                1934** |
|---------|--------|------------------------------------------------------------------------------------------------------------------|

**For      Fiscal Year Ended:**

**OR**

|  x |   | **TRANSITION                REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF                1934** |
|---------|--------|----------------------------------------------------------------------------------------------------------------------|

| Commission file number    | **0-50236**   |
|------------------------------------------|-------------------------|

**HORNBY      INTERNATIONAL, INC.**

| Delaware                                                                                         | 95-4708001                                                                |
|--------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------|
| (State                  or other jurisdiction of                  incorporation or organization) |  (IRS                  Employer Identification                  No.) |
|                                                                                             |                                                                           |
| 1701                  Broadway 255, Vancouver, WA                                                |  98663                                                               |
| (Address                  of principal executive offices)                                        | (Zip                  Code)                                                    |

**DOCUMENTS      INCORPORATED BY REFERENCE**

----

**TABLE      OF CONTENTS**

| **Item                Number and Caption**                                                                                                                                                                          |   | **Page**       |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------|
|                                                                                                                                                                                                                |   |           |
| Forward                Looking Statements                                                                                                                                                                           |   | 3              |
|                                                                                                                                                                                                                |   |           |
| PART                1                                                                                                                                                                                               |   |           |
| Item                1. Description                of Business                                                                                                                                                  |   | 3              |
| Item                2: Description                of Property                                                                                                                                                  |   | 4              |
| Item                3. Legal                Proceedings                                                                                                                                                        |   | 4              |
| Item                4. Submission                of Matters to Vote of Security Holders                                                                                                                        |   | 4              |
| PART                II                                                                                                                                                                                              |   |           |
| Item                5. Market                for Common Equity and Related Stockholder Matters                                                                                                       |   | 4              |
| Item                6. Plan                of Operation                                                                                                                                              |   | 5              |
| Item                7. Financial                Statements                                                                                                                                           |   | 6              |
| Item                8. Changes                in and Disagreements with Accountants on AccountingAnd                Financial Disclosure                                                                  |   |  17       |
| Item                8A. Controls                and Procedure                                                                                                                                        |   | 18             |
| Item                8B. Other                Information                                                                                                                                             |   | 18             |
| PART                III                                                                                                                                                                                        |   |           |
| Item                9. Directors,                Executive Officers, Promoters, Control Persons andCorporate                Governance; Compliance with Section 16(a) of theExchange                Act   |   |   18 |
| Item                10. Executive                Compensation                                                                                                                                        |   | 20             |
| Item                11. Security                Ownership of Certain Beneficial Owners andManagement                                                                                                      |   |  22       |
| Item                12. Certain                Relationships and Related Transactions, andDirector                Independence                                                                            |   | 23             |
| Item                13. Exhibits                                                                                                                                                                          |   | 24             |
| Item                14. Principal                Accountant Fees and Services                                                                                                                        |   | 25             |

----

**FORWARD-LOOKING      STATEMENTS**

*Except      for historical information, this report contains forward-looking statements      within the meaning of Section 21E of the Securities Exchange Act of 1934. Such      forward-looking statements involve risks and uncertainties, including, among      other things, statements regarding our business strategy, future revenues and      anticipated costs and expenses. Such forward-looking statements include, among      others, those statements including the words “expects,” “anticipates,”“intends,” “believes” and similar language. Our actual results may differ      significantly from those projected in the forward-looking statements. Factors      that might cause or contribute to such differences include, but are not limited      to, those discussed in the sections “Plan of Operation” and “Business”. You are      cautioned not to place undue reliance on the forward-looking statements, which      speak only as of the date of this report. We undertake no obligation to publicly      release any revisions to the forward-looking statements or reflect events or      circumstances taking place after the date of this document.*

**PART      I**

**ITEM      1.  **
**DESCRIPTION      OF BUSINESS**

**Business      Development**

**Patents,      Trademarks and Licenses, Franchises, Concessions, Royalty Agreements or Labor      Contracts**

**Research      and Development**

**Employees**

----

**Private      Placement**

**ITEM      2.  **
**DESCRIPTION      OF PROPERTY**

**ITEM      3.  **
**LEGAL      PROCEEDINGS**

**ITEM      4.  **
**SUBMISSION      OF MATTERS TO A VOTE OF SECURITY HOLDERS**

**PART      II**

**ITEM      5.  **
**MARKET      FOR COMMON EQUITY **

**AND      RELATED STOCKHOLDER MATTERS**

**Market      Information.**

**Holders**

----

**Dividends**

**Recent      Sales of Unregistered Securities**

**Securities      Authorized For Issuance Under Equity Compensation Plans**

**ITEM      6.  **
**PLAN      OF OPERATION**

----

**ITEM      7.  **
**FINANCIAL      STATEMENTS**

|                                                                          | Page   |
|-------------------------------------------------------------------------------|--------|
| Report                  of Independent Registered Public Accounting Firm.     | 7      |
|                                                                          |   |
| Balance                  Sheets as at December 31, 2006 and June 30, 2006     | 8      |
|                                                                          |   |
| Statement                  of Operations for the six month period ended       |   |
| December                  31, 2006, the year ended June 30, 2006,             |   |
| and                  the period from August 26, 1998 (inception)              |   |
| through                  December 31, 2006                                    | 9      |
|                                                                          |   |
| Statement                  of Changes in Stockholders’ Equity (Deficit) | 10     |
|                                                                          |   |
| Statements                  of Cash Flows for the six month period ended      |   |
| December                  31, 2006, the year ended June 30, 2006,             |   |
| and                  the period from August 26, 1998 (inception)              |   |
| through                  December 31, 2006                                    | 11     |
|                                                                          |   |
| Notes                  to Financial Statements                                | 12     |

----

**Chang          G. Park, CPA, Ph. D.**

**t**

**          371 E STREET **
**t**

**          CHULA VISTA **
**t**

**          CALIFORNIA 91910-2615**
**t**

**t**
**          TELEPHONE (858)722-5953 **
**t**
**          FAX (858) 408-2695 **
**t**
**          FAX (858) 764-5480**

**t**
**          E-MAIL **
**changgpark@gmail.com**
** **
**t**

**Report      of Independent Registered Public Accounting Firm**

|                                                             |   |   |   |
|------------------------------------------------------------------|--------|--------|--------|
| /s/                Chang Park                               |   |   |        |
| CHANG                G. PARK, CPA                                |   |   |        |
| March                21, 2007San                Diego, CA. 91910 |   |   |        |

----

**HORNBY        INTERNATIONAL, INC.**

**(A            Development Stage Company) **

**Balance                Sheets**

|                                                                                              |   |                            |     |                         |   |
|----------------------------------------------------------------------------------------------|--------|---------------------------------|----------|-----------------------------------|--------|
|                                                                                         |   | **As                of**        |     |  **As                of**    |   |
|                                                                                         |   | **December                31,** |     |  **June                30,** |   |
| **ASSETS**                                                                                   |   | **2006**                        |     |  **2006**                    |   |
| **Current                Assets**                                                            |   |                            |     |                         |   |
|                                                                                         |   |                            |     |                         |   |
| Cash                                                                                         |   | $                               | 100,000  |                              | $      | 1,667 |   |
| Advance                                                                                      |   |                            | -        |                              |   | - |   |
|                                                                                         |   |                            |     |                              |   |   |   |
| **Total                Current Assets**                                                      |   |                            | 100,000  |                              |   | 1,667 |   |
|                                                                                         |   |                            |     |                              |   |   |   |
| **TOTAL                ASSETS**                                                              |   | $                               | 100,000  |                              | $      | **1,667** |   |
|                                                                                         |   |                            |     |                              |   |   |   |
|                                                                                         |   |                            |     |                              |   |   |   |
| **LIABILITIES&STOCKHOLDERS'              EQUITY              (DEFICIT **)****       |   |                            |     |                              |   |   |   |
|                                                                                         |   |                            |     |                              |   |   |   |
| **Current                Liabilities**                                                       |   |                            |     |                              |   |   |   |
|                                                                                         |   |                            |     |                              |   |   |   |
| Accounts                payable and accrued expenses                                         |   | $                               | 59,833   |                              | $      | - |   |
| Loan                payable (a related party)                                                |   |                            | 150,000  |                              |   | 10,363 |   |
|                                                                                         |   |                            |     |                              |   |   |   |
| **Total                Current Liabilities**                                                 |   |                            | 209,833  |                              |   | 10,363 |   |
|                                                                                         |   |                            |     |                              |   |   |   |
| **TOTAL                LIABILITIES**                                                         |   |                            | 209,833  |                              |   | 10,363 |   |
|                                                                                         |   |                            |     |                              |   |   |   |
| **Stockholders'                Equity (Deficit)**                                            |   |                            |     |                              |   |   |   |
|                                                                                         |   |                            |     |                              |   |   |   |
| Preferred                stock, ($.0001 par value, 20,000,000                                |   |                            |     |                              |   |   |   |
| shares                authorized; none issued and outstanding.)                              |   |                            | -        |                              |   | - |   |
| Common                stock ($.0001 par value, 80,000,000                                    |   |                            |     |                              |   |   |   |
| shares                authorized; 1,121,000 shares issued and                                |   |                            |     |                              |   |   |   |
| outstanding                as of December 31, 2006 and                                       |   |                            |     |                              |   |   |   |
| June                30, 2006)                                                                |   |                            | 112      |                              |   | 112 |   |
| Paid-in                capital                                                               |   |                            | 35,165   |                              |   | 35,165 |   |
| Deficit                accumulated during development stage                                  |   |                            | (145,110 | )                                 |   | (43,973 | ) |
|                                                                                         |   |                            |     |                              |   |   |   |
| **Total                Stockholders' Equity (Deficit)**                                      |   |                            | (109,833 | )                                 |   | (8,696 | ) |
|                                                                                         |   |                            |     |                              |   |   |   |
| **TOTAL                  LIABILITIES & STOCKHOLDERS'                  EQUITY (DEFICIT)** |   | $                               | 100,000  |                              | $      | **1,667** |   |

**See      Notes to Financial Statements**

----

**HORNBY        INTERNATIONAL, INC.**

**(A            Development Stage Company) **

**Statements        of Operations**

|                                                 |   |                            |      |                            |   |  **August                26, 1998** |   |
|------------------------------------------------------|--------|---------------------------------|-----------|--------------------------------------|--------|------------------------------------------|--------|
|                                                 |   | **(6                months)**   |      |  **(12                months)** |   |  **(inception)**                    |   |
|                                                 |   | **Year                Ended**   |      |  **Year                Ended**  |   |  **through**                        |   |
|                                                 |   | **December                31,** |      |  **June                30,**    |   |  **December                31,**    |   |
|                                                 |   | **2006**                        |      |  **2006**                       |   |  **2006**                           |   |
|                                                 |   |                            |      |                            |   |                                |   |
| **Revenues**                                         |   |                            |      |                            |   |                                |   |
|                                                 |   |                            |      |                            |   |                                |   |
| Revenues                                             |   | $                               | -         |                                 | $      | -                                        |   | $ | 200 |   |
|                                                 |   |                            |      |                                 |   |                                     |   |   |   |   |
| **Total                Revenues**                    |   |                            | **-**     |                                 |   | **-**                                    |   |   | 200 |   |
|                                                 |   |                            |      |                                 |   |                                     |   |   |   |   |
| General                & Administrative Expenses |   |                            | 111,500   |                                 |   | 7,146                                    |   |   | 155,673 |   |
|                                                 |   |                            |      |                                 |   |                                     |   |   |   |   |
| **Income                from operations**            |   |                            | (111,500  | )                                    |   | (7,146                                   | )      |   | (155,473 | ) |
|                                                 |   |                            |      |                                 |   |                                     |   |   |   |   |
| **Other                income (expenses)**           |   |                            |      |                                 |   |                                     |   |   |   |   |
| Forgiveness                of loan                   |   |                            | 10,363    |                                 |   | -                                        |   |   | 10,363 |   |
| **Total                other income**                |   |                            | 10,363    |                                 |   | -                                        |   |   | 10,363 |   |
| **Net                Loss**                          |   | $                               | (101,137  | )                                    | $      | **(7,146**                               | **)**  | $ | **(145,110** | **)** |
|                                                 |   |                            |      |                                 |   |                                     |   |   |   |   |
|                                                 |   |                            |      |                                 |   |                                     |   |   |   |   |
| **Basic                loss per share**              |   | $                               | (0.09     | )                                    | $      | (0.01                                    | )      |   |   |   |
|                                                 |   |                            |      |                                 |   |                                     |   |   |   |   |
| **Weighted                average number of**        |   |                            |      |                                 |   |                                     |   |   |   |   |
| **common                shares outstanding**         |   |                            | 1,121,000 |                                 |   | 1,121,000                                |   |   |   |   |

**See        Notes to Financial Statements**

----

**HORNBY        INTERNATIONAL, INC.**

**(A            Development Stage Company) **

**Statement      of Changes in Stockholders' Equity (Deficit)**

**From        August 26, 1998 (inception) through December 31,        2006**

|                                                 |   |       |          |       |   |           |   | **Deficit**     |       |            |   |
|------------------------------------------------------|--------|------------|---------------|------------|--------|----------------|--------|-----------------|------------|-----------------|--------|
|                                                 |   |       |          |       |   |           |   | **Accumulated** |       |            |   |
|                                                 |   |       |          | **Common** |   | **Additional** |   | **During**      |       |                 |   |
|                                                 |   | **Common** |          | **Stock**  |   | **Paid-in**    |   | **Development** |       |            |   |
|                                                 |   | **Stock**  |          | **Amount** |   | **Capital**    |   | **Stage**       |       | **Total**  |   |
|                                                 |   |       |          |       |   |           |   |            |       |            |   |
| Stock                issued for cash on August 26,   |   |       |          |       |   |           |   |            |       |            |   |
| 1998                @ $0.001 per share               |   |       | 1,000,000     |       | $      | 100            |   | $               | 900        |            | $      | - |   | $ | 1,000 |   |
|                                                 |   |       |          |       |   |           |   |            |       |            |   |   |   |   |   |   |
| Stock                issued from sale of private     |   |       |          |       |   |           |   |            |       |            |   |   |   |   |   |   |
| placement                (note 1) on February 17,    |   |       |          |       |   |           |   |            |       |            |   |   |   |   |   |   |
| 1999                @ $0.10 per share                |   |       | 121,000       |       |   | 12             |   |            | 12,088     |            |   |   |   |   | 12,100 |   |
|                                                 |   |       |          |       |   |           |   |            |       |            |   |   |   |   |   |   |
| Net                loss, August 26, 1998 (inception) |   |       |          |       |   |           |   |            |       |            |   |   |   |   |   |   |
| through                June 30, 1999                 |   |       |          |       |   |           |   |            |       |            |   | (5,628 | ) |   | (5,628 | ) |
|                                                 |   |       |          |       |   |           |   |            |       |            |   |   |   |   |   |   |
| **Balance,                June 30, 1999**            |   |       | **1,121,000** |       |   | **112**        |   |            | **12,988** |            |   | **(5,628** | **)** |   | **7,472** |   |
|                                                 |   |       |          |       |   |           |   |            |       |            |   |   |   |   |   |   |
| Net                loss, June 30, 2000               |   |       |          |       |   |           |   |            |       |            |   | (7,143 | ) |   | (7,143 | ) |
|                                                 |   |       |          |       |   |           |   |            |       |            |   |   |   |   |   |   |
| **Balance,                June 30, 2000**            |   |       | **1,121,000** |       |   | **112**        |   |            | **12,988** |            |   | **(12,771** | **)** |   | **329** |   |
|                                                 |   |       |          |       |   |           |   |            |       |            |   |   |   |   |   |   |
| Net                loss, June 30, 2001               |   |       |          |       |   |           |   |            |       |            |   | (2,176 | ) |   | (2,176 | ) |
|                                                 |   |       |          |       |   |           |   |            |       |            |   |   |   |   |   |   |
| **Balance,                June 30, 2001**            |   |       | **1,121,000** |       |   | **112**        |   |            | **12,988** |            |   | **(14,947** | **)** |   | **(1,847** | **)** |
|                                                 |   |       |          |       |   |           |   |            |       |            |   |   |   |   |   |   |
| Net                loss, June 30, 2002               |   |       |          |       |   |           |   |            |       |            |   | (2,094 | ) |   | (2,094 | ) |
|                                                 |   |       |          |       |   |           |   |            |       |            |   |   |   |   |   |   |
| **Balance,                June 30, 2002**            |   |       | **1,121,000** |       |   | **112**        |   |            | **12,988** |            |   | **(17,041** | **)** |   | **(3,941** | **)** |
|                                                 |   |       |          |       |   |           |   |            |       |            |   |   |   |   |   |   |
| Net                loss, June 30, 2003               |   |       |          |       |   |           |   |            |       |            |   | (3,697 | ) |   | (3,697 | ) |
|                                                 |   |       |          |       |   |           |   |            |       |            |   |   |   |   |   |   |
| **Balance,                June 30, 2003**            |   |       | **1,121,000** |       |   | **112**        |   |            | **12,988** |            |   | **(20,738** | **)** |   | **(7,638** | **)** |
|                                                 |   |       |          |       |   |           |   |            |       |            |   |   |   |   |   |   |
| Contributed                Capital                   |   |       |          |       |   |           |   |            | 8,049      |            |   |   |   |   | 8,049 |   |
|                                                 |   |       |          |       |   |           |   |            |       |            |   |   |   |   |   |   |
| Contributed                Capital                   |   |       |          |       |   |           |   |            | 1,628      |            |   |   |   |   | 1,628 |   |
|                                                 |   |       |          |       |   |           |   |            |       |            |   |   |   |   |   |   |
| Net                loss, June 30, 2004               |   |       |          |       |   |           |   |            |       |            |   | (5,227 | ) |   | (5,227 | ) |
|                                                 |   |       |          |       |   |           |   |            |       |            |   |   |   |   |   |   |
| **Balance,                June 30, 2004**            |   |       | **1,121,000** |       |   | **112**        |   |            | **22,665** |            |   | **(25,965** | **)** |   | **(3,188** | **)** |
|                                                 |   |       |          |       |   |           |   |            |       |            |   |   |   |   |   |   |
| Contributed                Capital                   |   |       |          |       |   |           |   |            | 7,500      |            |   |   |   |   | 7,500 |   |
|                                                 |   |       |          |       |   |           |   |            |       |            |   |   |   |   |   |   |
| Net                loss, June 30, 2005               |   |       |          |       |   |           |   |            |       |            |   | (10,862 | ) |   | (10,862 | ) |
|                                                 |   |       |          |       |   |           |   |            |       |            |   |   |   |   |   |   |
| **Balance,                June 30, 2005**            |   |       | **1,121,000** |       | **$**  | **112**        |   | **$**           | **30,165** |            | **$**  | **(36,827** | **)** | **$** | **(6,550** | **)** |
|                                                 |   |       |          |       |   |           |   |            |       |            |   |   |   |   |   |   |
|                                                 |   |       |          |       |   |           |   |            |       |            |   |   |   |   |   |   |
| Contributed                Capital                   |   |       |          |       |   |           |   |            | 5,000      |            |   |   |   |   | 5,000 |   |
|                                                 |   |       |          |       |   |           |   |            |       |            |   |   |   |   |   |   |
| Net                loss, June 30, 2006               |   |       |          |       |   |           |   |            |       |            |   | (7,146 | ) |   | (7,146 | ) |
|                                                 |   |       |          |       |   |           |   |            |       |            |   |   |   |   |   |   |
| **Balance,                June 30, 2006**            |   |       | **1,121,000** |       |   | **112**        |   |            | **35,165** |            | **$**  | **(43,973** | **)** | **$** | **(8,696** | **)** |
|                                                 |   |       |          |       |   |           |   |            |       |            |   |   |   |   |   |   |
| Net                loss, December 31, 2006           |   |       |          |       |   |           |   |            |       |            |   | (101,137 | ) |   | (101,137 | ) |
|                                                 |   |       |          |       |   |           |   |            |       |            |   |   |   |   |   |   |
| **Balance,                December 31, 2006**        |   |       | **1,121,000** |       |   | **112**        |   |            | **35,165** |            | **$**  | **(145,110** | **)** | **$** | **(109,833** | **)** |

**See        Notes to Financial Statements**

----

**HORNBY        INTERNATIONAL, INC.**

**(A            Development Stage Company)**
**Statements              of Cash Flows**

|                                                                                    |   |                            |        |                           |   |  **August                26, 1998** |   |
|-----------------------------------------------------------------------------------------|--------|---------------------------------|-------------|--------------------------------|--------|------------------------------------------|--------|
|                                                                                    |   | **(6                months)**   |        | **(12                months)** |   |  **(inception)**                    |   |
|                                                                                    |   | **Year                Ended**   |        | **Year                Ended**  |   |  **through**                        |   |
|                                                                                    |   | **December                31,** |        | **June                30,**    |   |  **December                31,**    |   |
|                                                                                    |   | **2006**                        |        | **2006**                       |   |  **2006**                           |   |
|                                                                                    |   |                            |        |                           |   |                                |   |
| **CASH                FLOWS FROM OPERATING ACTIVITIES**                                 |   |                            |        |                           |   |                                |   |
|                                                                                    |   |                            |        |                           |   |                                |   |
| Net                income (loss)                                                        |   | $                               | (101,137    | )                              | $      | (7,146                                   | )      | $ | (145,110 | ) |
| Adjustments                to reconcile net income to net                               |   |                            |        |                           |   |                                     |   |   |   |   |
| cash                provided by (used in) operating activities:                         |   |                            |        |                           |   |                                     |   |   |   |   |
| Amortization                                                                            |   |                            | -           |                           |   | -                                        |   |   | 351 |   |
| (Increase)                decrease in organization costs                                |   |                            | -           |                           |   | -                                        |   |   | (351 | ) |
| Forgiveness                of loan to officer                                           |   |                            | (10,363     | )                              |   |                                     |   |   | - |   |
| Changes                in operating assets and liabilities:                             |   |                            |        |                           |   |                                     |   |   |   |   |
| Decrease                (increase) in advance                                           |   |                            | -           |                           |   | -                                        |   |   | - |   |
| Increase                (decrease) in accounts payable                                  |   |                            | 59,833      |                           |   | -                                        |   |   | 59,833 |   |
|                                                                                    |   |                            |        |                           |   |                                     |   |   |   |   |
| ***Net                cash provided by (used in) operating                activities*** |   |                            | **(51,667** | **)**                          |   | **(7,146**                               | **)**  |   | **(85,277** | **)** |
|                                                                                    |   |                            |        |                           |   |                                     |   |   |   |   |
|                                                                                    |   |                            |        |                           |   |                                     |   |   |   |   |
| **CASH                FLOWS FROM INVESTING ACTIVITIES**                                 |   |                            |        |                           |   |                                     |   |   |   |   |
|                                                                                    |   |                            |        |                           |   |                                     |   |   |   |   |
| ***Net                cash provided by (used in) investing                activities*** |   |                            | **-**       |                           |   | **-**                                    |   |   | **-** |   |
|                                                                                    |   |                            |        |                           |   |                                     |   |   |   |   |
| **CASH                FLOWS FROM FINANCING ACTIVITIES**                                 |   |                            |        |                           |   |                                     |   |   |   |   |
|                                                                                    |   |                            |        |                           |   |                                     |   |   |   |   |
| Incerease                in loan payable                                                |   |                            | 150,000     |                           |   | 3,750                                    |   |   | 150,000 |   |
| Proceeds                from issuance of commons stock                                  |   |                            | -           |                           |   | -                                        |   |   | 112 |   |
| Proceeds                from issuance of paid in capital                                |   |                            | -           |                           |   | 5,000                                    |   |   | 35,165 |   |
|                                                                                    |   |                            |        |                           |   |                                     |   |   |   |   |
| ***Net                cash provided by (used in) financing                activities*** |   |                            | **150,000** |                           |   | **8,750**                                |   |   | **185,277** |   |
|                                                                                    |   |                            |        |                           |   |                                     |   |   |   |   |
| ***Net                increase (decrease) in cash***                                    |   |                            | **98,333**  |                           |   | **1,604**                                |   |   | **100,000** |   |
|                                                                                    |   |                            |        |                           |   |                                     |   |   |   |   |
| ***Cash                at beginning of period***                                        |   |                            | 1,667       |                           |   | 63                                       |   |   | - |   |
|                                                                                    |   |                            |        |                           |   |                                     |   |   |   |   |
| ***Cash                at end of period***                                              |   | $                               | 100,000     |                           | $      | 1,667                                    |   | $ | **100,000** |   |
|                                                                                    |   |                            |        |                           |   |                                     |   |   |   |   |
| **SUPPLEMENTAL                DISCLOSURES OF CASH FLOW**                                |   |                            |        |                           |   |                                     |   |   |   |   |
| **INFORMATION:**                                                                        |   |                            |        |                           |   |                                     |   |   |   |   |
|                                                                                    |   |                            |        |                           |   |                                     |   |   |   |   |
| Interest                paid                                                            |   | $                               | -           |                           | $      | -                                        |   | $ | **-** |   |
|                                                                                    |   |                            |        |                           |   |                                     |   |   |   |   |
| Income                taxes paid                                                        |   | $                               | -           |                           | $      | -                                        |   | $ | **-** |   |

**See      Notes to Financial Statements**

----

**HORNBY        INTERNATIONAL, INC.**

**(A        Development Stage Company)**

**Notes        to Financial Statements**

**As        of December 31, 2006 and June 30, 2006**

***NOTE      1. ORGANIZATION AND DESCRIPTION OF BUSINESS***

***NOTE      2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES***

**a.      **
**Basis      of Accounting**

**b.      **
**Use      of Estimates**

----

**HORNBY      INTERNATIONAL, INC.**

**(A      Development Stage Company)**

**Notes      to Financial Statements**

**As      of December 31, 2006 and June 30, 2006**

***NOTE      2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)***

**c.      **
**Cash      Equivalents**

**d.      **
**Basic      Earnings (Loss) per Share**

**e.      **
**Income      Taxes**

**f.      **
**Recent      Accounting Pronouncements**

----

**HORNBY        INTERNATIONAL, INC.**

**(A        Development Stage Company)**

**Notes        to Financial Statements**

**As        of December 31, 2006 and June 30, 2006**

**f.      **
**Recent      Accounting Pronouncements (Continued)**

***NOTE      3. WARRANTS AND OPTIONS***

***NOTE      4. GOING CONCERN***

***NOTE      5. RELATED PARTY TRANSACTION***

----

**HORNBY        INTERNATIONAL, INC.**

**(A        Development Stage Company)**

**Notes        to Financial Statements**

**As        of December 31, 2006 and June 30, 2006**

***NOTE      6. INCOME TAXES***

|                                            |   | **As                of****December                31, 2006** |    | **As                of****June                30, 2006** |   |
|-------------------------------------------------|--------|--------------------------------------------------------------|---------|----------------------------------------------------------|--------|
|                                            |   |                                                         |    |                                                     |   |
| Deferred                tax assets:             |   |                                                         |    |                                                     |   |
| Net                operating loss carryforwards |   | $                                                            | 145,110 |                                                     | $      | 43,973 |   |
| Other                                           |   |                                                         | -0-     |                                                     |   | -0- |   |
| Gross                deferred tax assets        |   |                                                         | 21,766  |                                                     |   | 6,596 |   |
| Valuation                allowance              |   |                                                         | (21,766 | )                                                        |   | (6,596 | ) |
|                                            |   |                                                         |    |                                                     |   |   |   |
| Net                deferred tax assets          |   | $                                                            | -0-     |                                                     | $      | -0- |   |

***NOTE      7. NET OPERATING LOSSES***

***NOTE      8. STOCKHOLDERS’ EQUITY***

| ·   | Preferred                stock, $0.0001 par value: 20,000,000 shares authorized; -0- shares                issued                and outstanding. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------|

----

**HORNBY        INTERNATIONAL, INC.**

**(A        Development Stage Company)**

**Notes        to Financial Statements**

**As        of December 31, 2006 and June 30, 2006**

| ·   | Common                stock, $0.0001 par value: 80,000,000 shares authorized; 1,121,000                shares                issued and outstanding. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------|

***NOTE      9. PRIVATE PLACEMENT***

----

**ITEM      8.  **
**CHANGES      IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL      DISCLOSURE**

| ·   | internal                controls necessary for us to develop reliable financial statements                did not                exist; |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------|

| ·   | information                had come to their attention that led them to no longer be able to                rely on                our management’s representations or made them unwilling to be associated                with the financial statements prepared by our                management; |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | there                was a need to expand significantly the scope of their audit, or that                information had come to their attention during such time periods                that if                further investigated might materially impact the fairness or reliability                of either a previously issued audit report or the underlying financial                statement; or the financial statements issued or to be issued covering                the                fiscal periods subsequent to the date of the most recent financial                statements covered by an audit report;                or |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | information                had come to their attention that they had concluded materially impacted                the fairness or reliability of either (i) a previously issued audit                report                or the underlying financial statements, or (ii) the financial statements                issued or to be issued covering the fiscal periods subsequent to                the date                of the most recent financial statements covered by an audit                report. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

**ITEM      8A. CONTROLS AND PROCEDURES**

*Evaluation      of Disclosure Controls and Procedures.*

*Changes      in Internal Control over Financial Reporting*

**ITEM      8B. OTHER INFORMATION**

**PART      III**

**ITEM      9.  **
**DIRECTORS,      EXECUTIVE OFFICERS, **

**PROMOTERS,      CONTROL PERSONS AND CORPORATE **

**GOVERNANCE;      COMPLIANCE WITH SECTION 16(A) OF **

**THE      EXCHANGE ACT**

**Executive      Officers and Directors**

----

| Name                          |   | Positions                Held                                                        |   | Age |   | Date                of Election or Appointment as Director |
|-------------------------------|--------|--------------------------------------------------------------------------------------|--------|-----|--------|----------------------------------------------------------------------|
| John                Probandt  |   | President,                Secretary, Treasure, Chief Executive and Financial Officer |   | 52  |   | July                7, 2006                                          |
| Maureen                Brogan |   | Director                                                                             |   | 43  |   | August                26, 1998                                       |

**Board      of Directors**

----

**Compliance      with Section 16(a) of the Exchange Act**

**Code      of Ethics**

**ITEM      10.  **
**EXECUTIVE      COMPENSATION**

----

**Summary      Compensation Table**

| Name                andPrincipal Position             |   | Year   |   | Salary                ($) |   | Bonus                ($) |   | Stock                Awards ($) |   | Option                Awards ($) |   | Non-Equity                Incentive Plan Compen-sation ($) |   | Change                in Pension Value and Non-qualified Deferred Compen-sation Earnings                ($) |   | All                Other Compensation ($) |   | Total                ($) |   |
|------------------------------------------------------------|--------|--------|--------|---------------------------|--------|--------------------------|--------|---------------------------------|--------|----------------------------------|--------|------------------------------------------------------------|--------|-------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------|--------|--------------------------|--------|
| (a)                                                        |   | (b)    |   | (c)                       |   | (d)                      |   | (e)                             |   | (f)                              |   | (g)                                                        |   | (h)                                                                                                         |   | (i)                                       |   | (j)                      |   |
| John                Probandt, Chief Executive Officer      |   |   | 2006   |                      |   | 0                        |   |                            | 0      |                             |   | 0                                                          |   |                                                                                                        | 0      |                                      |   | 0                        |   |   | 0 |   |   | 0 |   |   | 0 |   |
|                                                       |   |   | 2005   |                      |   | 0                        |   |                            | 0      |                             |   | 0                                                          |   |                                                                                                        | 0      |                                      |   | 0                        |   |   | 0 |   |   | 0 |   |   | 0 |   |
|                                                       |   |   |   |                      |   |                     |   |                            |   |                             |   |                                                       |   |                                                                                                        |   |                                      |   |                     |   |   |   |   |   |   |   |   |   |   |
| Maureen                Brogan, Chief Executive Officer (2) |   |   | 2006   |                      |   | 0                        |   |                            | 0      |                             |   | 0                                                          |   |                                                                                                        | 0      |                                      |   | 0                        |   |   | 0 |   |   | 0 |   |   | 0 |   |
|                                                       |   |   | 2005   |                      |   | 0                        |   |                            | 0      |                             |   | 0                                                          |   |                                                                                                        | 0      |                                      |   | 0                        |   |   | 0 |   |   | 0 |   |   | 0 |   |

| (1) | John                Probandt has served as our sole officer and as a director since July                7,                2006. We do not have an employment agreement with Mr. Probandt and                have                not been paid any compensation to Mr. Probandt to                date. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | Maureen                Brogan served as our chief executive officer from our inception until                July                7, 2006. She has served as a director since our inception. Ms. Brogan                received no compensation from us in her capacity as our chief executive                officer during 2005 or 2006. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Compensation      of Directors**

----

**ITEM      11.  **
**SECURITY      OWNERSHIP OF CERTAIN BENEFICIAL**

**OWNERS        AND MANAGEMENT**

| Name                and Addressof                Beneficial Owner                                           |   | Shares                of Common Stock Beneficially Owned |      | Percentage                Ownership                (1) |   |
|-------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------------|-----------|--------------------------------------------------------|--------|
| China                Sea Holdings LLC (2)1701                Broadway 255Vancouver,                WA 98663 |   |                                                               | 1,000,000 |                                                   |   | 89.2 | % |
|                                                                                                        |   |                                                               |      |                                                   |   |   |   |
| John                Probandt1701                Broadway 255Vancouver,                WA 98663              |   |                                                               | 1,000,000 |                                                   |   | 89.2 | % |
|                                                                                                        |   |                                                               |      |                                                   |   |   |   |
| Maureen                Brogan1701                Broadway 255Vancouver,                WA 98663             |   |                                                               | 0         |                                                   |   | 0 | % |
|                                                                                                        |   |                                                               |      |                                                   |   |   |   |
| All                directors and executive officersas                a group (2 persons)                    |   |                                                               | 1,000,000 |                                                   |   | 89.2 | % |

----

| (1) | Based                upon 1,121,000 shares issued and outstanding as at April 17,                2007. |
|-----|--------------------------------------------------------------------------------------------------------|

| (2) | The                beneficial owner of China Sea Holdings,                LLC. |
|-----|--------------------------------------------------------------------------------|

| (3) | John                Probandt is the beneficial owner of 1,000,000 shares registered in                the                name of China Sea Holdings LLC. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------|

----

**Changes      in Control**

**Securities      Authorized for Issuance Under Equity Compensation Plans**

**ITEM      12.  **
**CERTAIN      RELATIONSHIPS AND RELATED TRANSACTIONS**
**,      AND **

**DIRECTOR      INDEPENDENCE**

----

**ITEM      13.  **
**EXHIBITS**

**Exhibits**

| Exhibit                No. |   | SEC                Report Reference Number |   | Description                                                                                                                                 |
|----------------------------|--------|--------------------------------------------|--------|---------------------------------------------------------------------------------------------------------------------------------------------|
| 3.1                        |   | 2.1                                        |   | Certificate                of Incorporation of Registrant filed August 26, 1998                (1)                                          |
| 3.2                        |   | 2.2                                        |   | By-Laws                of Registrant. (1)                                                                                                   |
| 14                         |   |                                       |   | Code                of Ethics(2)                                                                                                            |
| 21                         |   |                                       |   | List                of Subsidiaries of Registrant(3)                                                                                        |
| 31.1/31.2                  |   |                                       |   | Rule                13(a) - 14(a)/15(d) - 14(a) Certification of Principal Executive                and                Financial Officer(3) |
| 32.1/32.2                  |   |                                       |   | Rule                1350 Certification of Chief Executive and Financial                Officer(3)                                           |

----

| (1) | Filed                with the Securities and Exchange Commission on April 3, 2007 as an                exhibit, numbered as indicated above, to the Registrant’s registration                statement on Form 10-SB, which exhibit is incorporated herein by                reference. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | Filed                with the Securities and Exchange Commission on September 25, 2006                as an                exhibit, numbered as indicated above, to the Registrant’s Annual Report on                Form 10-QSB for the year ended June 30, 2006, which exhibit is                incorporated herein by reference. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | Filed                herewith. |
|-----|--------------------------------|

----

**ITEM      14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.**

|  Fee                Category     |   | Six                Months endedDecember                31, 2006 |   | Year                endedJune                30, 2006 |   | Year                endedJune                30, 2005 |   |
|---------------------------------------|--------|-----------------------------------------------------------------|--------|-------------------------------------------------------|--------|-------------------------------------------------------|--------|
| Audit                fees (1)         |   | $                                                               | 3,700  |                                                  | $      | 2,500                                                 |   | $ | 2,000 |   |
| Audit-related                fees (2) |   |                                                            | 0      |                                                  |   | 0                                                     |   |   | 0 |   |
| Tax                fees (3)           |   |                                                            | 0      |                                                  |   | 0                                                     |   |   | 0 |   |
| All                other fees (4)     |   |                                                            | 0      |                                                  |   | 0                                                     |   |   | 0 |   |
| Total                fees             |   |                                                            | 3,700  |                                                  |   | 2,500                                                 |   |   | 2,000 |   |

| (1)   | Audit                fees consists of fees incurred for professional services rendered                for the                audit of consolidated financial statements, for reviews of our interim                consolidated financial statements included in our quarterly reports                on                Form 10-QSB and for services that are normally provided in connection                with                statutory or regulatory filings or                engagements. |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |   |
|--------|--------|

| (2)   | Audit-related                fees consists of fees billed for professional services that are reasonably                related to the performance of the audit or review of our consolidated                financial statements, but are not reported under “Audit fees.” |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |   |
|--------|--------|

| (3)   | Tax                fees consists of fees billed for professional services relating to                tax                compliance, tax planning, and tax                advice. |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |   |
|--------|--------|

| (4)   | All                other fees consists of fees billed for all other                services. |
|-----------------|----------------------------------------------------------------------------------------------|

----

**SIGNATURES**

|                                       |                                                 |                                                          |
|--------------------------------------------|------------------------------------------------------|---------------------------------------------------------------|
| Date:                April 27, 2007 . | HORNBY              INTERNATIONAL, INC               |
|                                  |                                            |                                                     |
|                                            | By:                                        | /s/              John              Probandt    |
|                                       | John                Probandt,                        |
|                                       | President                and Chief Executive Officer |

|  SIGNATURE                                                      |   |  TITLE                                                                                                        |   |  DATE                    |
|----------------------------------------------------------------------|--------|--------------------------------------------------------------------------------------------------------------------|--------|-------------------------------|
| /s/                John Probandt John                Probandt   |   | President,                Treasurer Chief Executive Officer, Chief Financial and Accounting                Officer |   | April                27, 2007 |
|                                                                 |   |                                                                                                               |   |                          |
| Board                of Directors                                    |   |                                                                                                               |   |                          |
|                                                                 |   |                                                                                                               |   |                          |
| /s/                John Probandt John                Probandt   |   | Director                                                                                                           |   | April                27, 2007 |
|                                                                 |   |                                                                                                               |   |                          |
| /s/                Maureen Brogan Maureen                Brogan |   | Director                                                                                                           |   | April                27, 2007 |

----