UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                   FORM 10-KSB


(Mark One)

[X]  ANNUAL REPORT  PURSUANT TO SECTION 13 OR 15(d) OF THE  SECURITIES  EXCHANGE
     ACT OF 1934

For the fiscal year ended: December 31, 2003

                                       OR

[_]  TRANSITION  REPORT  PURSUANT  TO  SECTION  13 OR  15(d)  OF THE  SECURITIES
     EXCHANGE ACT OF 1934

For the transition period from ________________ to _________________.


Commission file number: 000-32567


                              BLUE INDUSTRIES INC.
                  -------------------------------------------
                 (Name of small business issuer in its charter)


          NEVADA                                         52-2273215
-------------------------------             ------------------------------------
(State or other jurisdiction                (I.R.S. Employer Identification No.)
of incorporation or organization)

 1480 Breakers West Boulevard
  Royal Palm Beach, Florida                                33401
-------------------------------             ------------------------------------
(Address of principal                                    (Zip Code)
 executive offices)

Issuer's telephone number: (561) 271-8983


Securities registered under Section 12(g) of the Exchange Act:

                         Common Stock, $0.001 par value
                            ------------------------
                                (Title of class)


Copies of Communications Sent to:

                               Wayne Hartke, Esq.
                               The Hartke Building
                               7637 Leesburg Pike, Suite 200
                               Falls Church, VA 22043
                               Phone (703-734-2810)


<PAGE>



     Check  whether  the issuer (1) filed all  reports  required  to be filed by
Section 13 or 15(d) of the  Exchange  Act during the past 12 months (or for such
shorter period that the  registrant was required to file such reports),  and (2)
has been subject to such filing requirements for the past 90 days.

                                                        Yes [X] No [_]



     Check if there is no disclosure  of  delinquent  filers in response to Item
405 of Regulation S-B is not contained in this form,  and no disclosure  will be
contained,  to the  best of  registrant's  knowledge,  in  definitive  proxy  or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. [_]



State issuer's revenues for its most recent fiscal year: $0.



     State the aggregate  market value of the  2,449,681  shares of common stock
held by  non-affiliates  computed by  reference to the price at which the common
equity was sold, or the average bid and asked price of such common equity, as of
a specified date within the past 60 days.  (See  definition of affiliate in Rule
12b-2 of the  Exchange  Act.) was  $244,968 at the close of business on November
24, 2004.



     State the number of shares  outstanding of each of the issuer's  classes of
common equity,  as of the latest  practicable  date.  4,870,714 Shares of Common
Stock at the close of business on November 24, 2004.



Transitional Small Business Disclosure Format (check one): Yes [_] No [X]










<PAGE>



                                     PART I


FORWARD-LOOKING STATEMENTS

     This annual  report  contains  forward-looking  statements  as that term is
defined  in  the  Private  Securities  Litigation  Reform  Act  of  1995.  These
statements relate to future events or our future financial performance.  In some
cases, you can identify forward-looking statements by terminology such as "may",
"will", "should", "expects", "plans",  "anticipates",  "believes",  "estimates",
"predicts",  "potential"  or  "continue" or the negative of these terms or other
comparable terminology.  These statements are only predictions and involve known
and unknown risks,  uncertainties and other factors,  including the risks in the
sections  entitled  Description  of Business  and  Management's  Discussion  and
Analysis  or Plan of  Operation,  that may cause our actual  results,  levels of
activity, performance or achievements to be materially different from any future
results, levels of activity, performance or achievements expressed or implied by
these forward-looking statements.

     Although we believe that the expectations  reflected in the forward-looking
statements  are  reasonable,  we  cannot  guarantee  future  results,  levels of
activity,  performance or  achievements.  Except as required by applicable  law,
including the securities  laws of the United States,  we do not intend to update
any of the  forward-looking  statements  to conform  these  statements to actual
results.


ITEM 1. DESCRIPTION OF BUSINESS.

HISTORY OF OUR COMPANY

     Our company was  incorporated in Nevada on April 5, 2000. Our original name
was Burrard Technologies, Inc., and our original business purpose was to develop
and  commercialize  an on-line  Internet domain name  registration  service that
would allow users to complete domain  registrations  for Chinese  websites using
Chinese  characters.  On May 24,  2000,  we  purchased  the right to develop and
commercialize a software product known as "International Reg," together with the
associated  www.internationalreg.com website, from Pan Ocean Consulting Ltd. for
$32,000.  We  subsequently  filed a Form SB-2  registration  statement under the
Securities  Act of 1933 to  register  the  resale  of our  outstanding  stock by
selling stockholders.  In April 2001, we filed a Form 8-A registration under the
Securities  Exchange Act of 1934.  We have been a reporting  company  since that
date.

     Our  efforts to  commercialize  the  International  Reg  software  were not
successful and in the summer of 2001, we decided to begin  consider  alternative
financing and business opportunities.  In October 2001, we implemented a 3 for 1
stock split that increased our outstanding  capital stock from 5,729,000  shares
to 17,187,000 shares.

     On December 4, 2002, we agreed to acquire 100% of the outstanding  stock of
Technocall  SA, a Swiss  corporation,  pursuant  to a share  purchase  agreement
between our company,  Technocall SA ("Technocall") and Technocall's stockholders
Advanced Technologies  Development Co. Ltd. ("ATD"),  Rocasoprane Ltd. and Axiom
S.A.  (collectively,  the  "Technocall  Shareholders").   On  the  date  of  the
agreement,  we were essentially inactive;  and we had net liabilities of $62,068
and an accumulated deficit of $117,468 from our prior business operations.






                                       3
<PAGE>



     Under the terms of the share purchase agreement:

     o    Our company agreed to acquire all of the issued and outstanding  stock
          of Technocall in exchange for 7,600,000 shares of common stock;
     o    Our former  president and our former secretary and treasurer agreed to
          surrender  an  aggregate  of  7,125,000  shares of common stock to our
          company for cancellation; and
     o    The  former  members  of our board of  directors  agreed to  appoint a
          successor  board  selected  by the  Technocall  Stockholders  and then
          resign.

     We closed the  Technocall  acquisition  on December 18,  2001.  We received
certificates  for a total of 7,125,000  shares from our former  officers,  which
were promptly  cancelled,  and  concurrently  issued  certificates for 7,600,000
shares of our common stock to the Technocall Shareholders as follows:

Technocall Shareholder                         Number of Shares
---------------------------------------------------------------
Advanced Technologies Development Co. Ltd.     3,800,000 Shares
Rocasoprane Ltd.                               2,538,400 Shares
Axiom S.A.                                     1,261,600 Shares

     In  connection  with  the  Technocall  acquisition,  our  former  board  of
directors  appointed a successor  board selected by the Technocall  Shareholders
and then  resigned.  There were no  disagreements  between  our  company and our
former  directors  on  any  matter  relating  to  our  operations,  policies  or
practices.  Upon  completion of the  Technocall  acquisition  we had  17,662,000
shares of common stock issued and outstanding;  and the Technocall  Shareholders
owned  43% of our  outstanding  common  stock  and  controlled  of our  board of
directors.  Accordingly,  the  Technocall  acquisition  resulted  in a change in
control.  The persons who became directors of our company in connection with the
Technocall acquisition are identified in the following table:

Name                      Age     Position
--------------------------------------------------------
Fernand LeLoroux           63     Director and President
Cyril Heitzler             33     Director and Secretary

     We changed  our name to Blue  Industries,  Inc.  on April 2,  2002;  and on
October  28,  2002,  we  implemented  a 1 for 20  reverse  stock  split.  Unless
otherwise  noted,  balance of this report gives  retroactive  effect the reverse
stock split.

     In March 2003, we formed a new  subsidiary,  Blue  Industries,  Inc.  under
Florida law.

     In 2003 we elected to file bankruptcy of our French and Swiss subsidiaries.
These  liquidations  were  completed  during 2003.  The Company  recorded a gain
amounting to $1,042,500 as a result of these liquidations.


                              HISTORY OF TECHNOCALL

     Technocall  was  incorporated  in  Switzerland  on March 11, 1992,  but was
essentially  inactive  until  September  29,  2001  when  it  purchased  certain
intellectual property, parts and supplies,  machinery and equipment and computer
software   for  the  design,   manufacturing,   management   and   operation  of
small-throughput  water treatment systems. From September through December 2001,
Technocall's principal business activities focused on the further development of
the  acquired  properties  and  the  initiation  of  marketing   activities  for
small-throughput water treatment systems.

     Agreements with ATD and Cartis, Inc. Technocall  purchased its intellectual
properties,  parts and supplies,  machinery and equipment and computer software,
together with an electronic  smart card management  system for  small-throughput
water treatment  systems,  from ATD.  Concurrently,  Technocall  entered into an
exclusive  distribution  and supply  agreement with Cartis Inc., an affiliate of
ATD. Cartis is a public company that withdrew its securities  from  registration
under  the  Exchange  Act in  January  of  2002  and  presently  trades  through
quotations in the NQB Pink Sheets.



                                       4
<PAGE>



     Technocall  issued a  subordinated  note  payable  to ATD in the  amount of
$4,288,500 as consideration for the purchase of the software, designs, technical
know-how,  equipment,  components  and  supplies.  The ATD note  was  unsecured,
non-interest bearing, subordinated against future indebtedness of Technocall and
had no specific terms for repayment.  Since ATD was a significant stockholder of
Technocall on the date of the  transaction,  we valued the  purchased  assets at
$423,937,  their historical cost to ATD. The difference  between the face amount
of the ATD note and the carrying  value of the purchased  assets was recorded in
our financial  statements  for the year ended  December 31, 2001 as a $3,864,563
distribution of equity. ATD subsequently  agreed to forgive $31,070 of principal
in recognition of certain expenses  incurred by Technocall.  This forgiveness of
indebtedness  was recorded as a reduction in the  distribution  of equity in our
financial  statements  for the year ended  December 31, 2001. In April 2002, ATD
agreed to forgive the balance of the note. This  forgiveness of indebtedness was
recorded as a reduction to the  distribution  of equity and  additional  paid-in
capital in our financial statements for the year ended December 31, 2002.

     Under  the  terms of the  Cartis  Agreement,  Technocall  was  granted  the
exclusive  worldwide right to distribute certain consumable  filtration products
manufactured  by  Cartis  that  were  designed  for use  small-throughput  water
treatment systems. The exclusivity of the rights granted by Cartis was dependent
on  Technocall's  ability to meet  certain  agreed sales  targets at  six-month,
12-month  and 18- month  intervals.  If the agreed upon sales  targets  were not
achieved,  Cartis would be free to terminate the  exclusivity  provisions of the
contract,  but would not have the right to terminate the  contract.  In exchange
for the  distribution  rights  granted by Cartis,  Technocall  granted  Cartis a
non-exclusive  right to purchase  electronic smart card management  systems from
Technocall  for  use  in  certain  small-  throughput  water  treatment  systems
manufactured  by Cartis.  The Cartis  Agreement  provides for a three-year  term
ending on  September  28,  2004 that is subject to  automatic  renewal for three
years if no notice of cancellation  is sent during the six months  preceding the
termination date.


                             BUSINESS OF OUR COMPANY

                                  Introduction

     We have elected to simply sell small-throughput water treatment systems and
associated  consumable  products that provide reliable supplies of safe drinking
water to end users.  Our  products  give  end-users  a cost  effective  means of
filtering,  treating,  disinfecting  and  conserving  water  without  the use of
chlorine and other  chemicals.  The primary  target markets for our products are
residential,  industrial,  municipal and  agricultural  users in less  developed
countries and other areas that do not have ready access to reliable  supplies of
safe clean water for human consumption and other purposes.

     The  flexibility of the water  treatment  technologies  available to us has
facilitated  the  development of a series of  small-throughput  water  treatment
systems for human  consumption,  agriculture,  aquaculture  and industrial  use.
These  products  are also useful in the  treatment of  wastewater.  Depending on
configuration,  these  products can process  between 3,600 and 288,000 liters of
water per day.



                                       5
<PAGE>



     Our   business   plan  calls  for   licensing   standardized   designs  for
small-throughput   water  treatment  systems  and  selling  the  components  and
consumables  that  are  required  for the  operation  and  maintenance  of water
treatment systems based on these designs. We believe the principal purchasers of
our products will be:

     o    Businesses  that  have  special  water  treatment   requirements   for
          industry, agriculture and aquaculture;
     o    Remote  towns  and  villages  in less  developed  countries  where the
          availability  of clean water for human  consumption  is a  significant
          problem; and
     o    Individuals  who are not  adequately  served  by safe  drinking  water
          systems.

     We commenced limited sales of demonstration systems we originally developed
in the first quarter of 2002.

                           Development of our business

     Our business plan has undergone a radical  transformation since the closing
of the Technocall  acquisition.  Our original plan was to integrate technologies
purchased from ATD;  consumables  purchased  from Cartis and other  technologies
developed by third  parties into  integrated  small-throughput  water  treatment
systems.  Over the last 16  months we have  encountered  numerous  economic  and
technical  problems that delayed the  implementation  of our plan. The principal
problems we encountered include:

     o    A series of  agreements  with  Eaudegam  SA relating to our license of
          certain  patented   technologies  for  the  initial  clarification  of
          wastewater and other highly contaminated water supplies;
     o    A series of negotiations with potential customers in China,  Thailand,
          Cambodia,  Africa and Middle  East that  accentuated  the cost  issues
          inherent in our original business plan;
     o    A series of increasingly  hostile business and technical disputes with
          ATD, Cartis and Mr. Herve Gallion, a principal stockholder and control
          person of both companies; and
     o    A burglary at our Pringy  facility in mid-March that  precipitated  an
          April  8,  2003  bankruptcy  filing  by  our  French  subsidiary  Blue
          Industries  SAS and the  subsequent  bankruptcy  filing  of our  Swiss
          subsidiary, Blue Industries, SA.

     The following paragraphs  separately discuss the foregoing problems and our
responses to those problems.

     Eaudegam license.  We first licensed the Eaudegam technology in February of
2002, and we subsequently  agreed to issue 450,000 shares of our common stock in
exchange  for a  significant  reduction  in  our  future  royalty  payments.  We
ultimately  concluded that the Eaudegam  technology was unsuitable for our needs
and that comparable or superior  clarification  technologies were available from
others at a significantly  lower cost.  Accordingly,  we terminated the Eaudegam
license and the  associated  agreement  to issue  stock in exchange  for reduced
royalties in April of 2002.  We did not make any material  payments or issue any
stock to Eaudegam in connection  with either the creation or the  termination of
the license.

     Customer  negotiations.  In  negotiations  with our  distributors in China,
Thailand, Cambodia, Africa and Middle East, it became apparent that our original
plan to manufacture  small-throughput water treatment systems in France and then
ship finished products to developing countries was flawed,  primarily because of
high French labor costs. In effect, our distributors concluded that our products
could not be competitive in developing  countries  unless they were assembled in



                                       6
<PAGE>



the destination country using local labor and imported  components.  In response
to these  concerns,  we have  modified our  original  business  plan.  Under our
modified plan, we intend to act primarily as a licensor of proprietary  designs,
a provider of engineering and consulting  services and a supplier of specialized
consumables. Most of our non-technical manufacturing and assembly functions will
be  outsourced  to local  contractors  in the  developing  countries  where  our
products will be used.

     ATD and Cartis  disputes.  Our business and technical  disputes with Cartis
initially  focused on  over-invoicing  for  short-weight  deliveries and quality
control  issues.  These  disputes were  complicated by the fact that our product
performance  testing  was  considerably  less  favorable  than the test  results
claimed by Cartis in its  promotional  materials  and patents.  In the summer of
2002, our investigations  revealed that Herve Gallion,  the president of Cartis,
was a convicted  felon who was sentenced in 1987 to a four-year  prison term for
fraud.  In  combination,  these  developments  left us with  considerable  doubt
respecting  the  reliability of Mr. Gallion and the ability of Cartis to deliver
filtration  products that  conformed to contract  specifications.  We ultimately
concluded  that we could not rely on Cartis to deliver a  consistent  product in
sufficient volume to satisfy our projected needs. After careful consideration of
available  options,  we  elected  to  develop a line of  proprietary  filtration
products and terminate our relationship with Cartis.

     Pringy  burglary.  In March  2003,  we  suffered a  burglary  at our Pringy
facility  that  appears  to be  directly  related to our  disputes  with ATD and
Cartis.  We leased our facility in September 2002, after an affiliate of Cartis,
cancelled  its lease on the  premises.  Unknown to us, Mr.  Herve  Gallion,  the
principal  stockholder and president of Cartis and ATD unlawfully kept copies of
the keys when the lease was terminated. When we discovered the burglary, we also
found a letter addressed to our company and signed by Mr. Gallion who advised us
that since the  relationship  between Cartis and our company had terminated,  we
had no right to continued  possession of the products and inventory we purchased
from  Cartis.  Therefore,  Mr.  Gallion  apparently  believed  he had a right to
surreptitiously  enter our  Pringy  facility  over the  weekend  and  remove our
property without our permission.

     We have  reported  the  burglary to the French  police who are treating the
entry and  burglary as a criminal  matter.  The French  police  have  cautioned,
however,  that they may be  unable to find Mr.  Gallion,  who is a  resident  of
Mauritius;  determine  whether  our  property is still in France;  and  commence
appropriate  legal action to prosecute Mr. Gallion and compel the restitution of
our property.  There are no assurances that the French police will ever find Mr.
Gallion within their jurisdiction, that our property will ever be found, or that
our  property  will have been  stored  under  conditions  that would  permit the
eventual resale to customers in the ordinary course of business.

     We have submitted a claim to GAN Assurance SA, our insurance carrier. Since
Mr. Gallion  retained copies of the keys to our Pringy facility when the earlier
lease was  terminated,  GAN Assurance has taken a preliminary  position that the
theft loss may be excluded under the terms of our policy.  Negotiations with GAN
Assurance are  continuing and it may be necessary to institute a civil action in
the French courts.

     Bankruptcy of Blue  Industries SAS. After the French police advised us that
they could not find Mr.  Gallion or our property;  and GAN Assurance  took a the
position  that the theft loss may be excluded  under the terms of our  insurance
policy,  our board of  directors  determined  that the best way to  protect  the
interests  of our company  and our  stockholders  would be to file a  bankruptcy
petition  under  French law for the  liquidation  of Blue  Industries  SAS,  our



                                       7
<PAGE>



principal operating subsidiary.  This petition for the bankruptcy liquidation of
Blue  Industries  SAS was filed with  Tribunal de Commerce in Annecy,  France on
April 8, 2003 (Case No. 3290). For a more detailed discussion of this bankruptcy
proceeding and its impact of on our business,  property and prospects, see Items
3 and 6.

                                 WATER TREATMENT

     The  purification of water for human  consumption,  or for use in industry,
agriculture and aquaculture, is generally a three-stage process.

     Clarification.  In the first  stage,  contaminated  water is  clarified  to
remove suspended organic and inorganic particles and other contaminants.  If the
source is relatively clean,  simple cartridge or sand filters can do an adequate
job. However, if suspended organic and inorganic particles or other contaminants
are a significant  problem,  more sophisticated  methods may be required. A wide
variety of  clarification  technologies and products are available in the public
domain. Other clarification  technologies can be licensed from third parties who
hold  patents  or  other  intellectual  property  rights  with  respect  to such
technologies.  We  believe  simple  cartridge  or sand  filters  will be able to
provide adequate clarification for the bulk of our potential customers.

     Ultra filtration.  In the second stage, clarified water is further filtered
to remove  microscopic  particles.  A wide variety of effective ultra filtration
technologies  are  available  in  the  public  domain.  Other  ultra  filtration
technologies  can be  licensed  from  third  parties  who hold  patents or other
intellectual property rights. We believe off-the-shelf ultra filtration products
will be able to  provide  adequate  purification  for the bulk of our  potential
customers.

     Disinfection. In the third stage, filtered water is further treated to kill
any amoebic,  bacterial and viral  pathogens  that after the  clarification  and
ultra filtration stages.  While a variety of physical and chemical  disinfection
technologies  are  available  in  the  public  domain,  and  other  disinfection
technologies  can be  licensed  from  third  parties  who hold  patents or other
intellectual  property rights, we prefer an off-the-shelf  in-line  disinfection
system that uses ultraviolet light to kill residual amoebic, bacterial and viral
pathogens.


                                    MARKETING

     We have identified  three principal  markets for the small throughput water
treatment systems: available to us

     Residential use. The availability of adequate supplies of potable water for
residential  use is a  worldwide  concern.  Currently,  only  one-  third of the
world's  population is supplied with reliable potable water. We believe that the
supply of water treatment  systems to developing  countries is a large potential
market  because  of the  amount  of  funding  available  from  governmental  and
non-governmental  sources. The installation and maintenance of traditional water
treatment systems in remote areas is typically  difficult because the population
often widely  dispersed and far from  economic  centers.  In addition,  there is
typically  a  lack  of  infrastructure   and  adequately   trained   maintenance
technicians.  We have designed our small throughput  water treatment  systems to
function well in remote locations with minimal maintenance.  We believe that our
small  throughput  water  treatment  systems  satisfy all applicable  government
regulations.



                                       8
<PAGE>



     Industrial use. The availability of adequate  supplies of potable water for
industry is a worldwide  concern.  We believe that the supply of scalable  water
treatment  systems to industrial  users in less  developed  countries is a large
potential  market.  The installation  and maintenance of traditional  industrial
water  treatment  systems  in remote  areas is often  difficult  because  of the
technical  skills  required  for the safe  operation  of  chemical  based  water
purification  systems.  We have designed our industrial water treatment products
to function well in remote  locations with minimal  maintenance,  monitoring and
technical support staff.

     Agriculture  and  Aquaculture.  Water  quality is a  critical  issue in the
fields of agriculture and aquaculture  because production is wholly dependent on
water quality. In hydroponics, our technologies have demonstrated the ability to
eliminate   microscopic  pathogens  while  permitting  the  reuse  of  nutritive
solutions.  Similar  results  have  been  obtained  in  aquaculture  operations,
particularly  shrimp farms, where disease control without the indiscriminate use
of  antibiotics  is a  critical  issue.  Tests have also  demonstrated  that the
incorporation  of our  technology  into  irrigation  systems  can help  increase
production while minimizing the risks of water borne microscopic pathogens.

                              GOVERNMENT REGULATION

     The distribution  and use of our small  throughput water treatment  systems
will be regulated by a variety of government agencies.  The amount and nature of
the applicable regulations will vary from jurisdiction to jurisdiction, and will
primarily  apply to our  distributors  who must ensure that the quality of water
produced using our products meets applicable standards.  Therefore,  our ability
to sell our  products  in a  particular  country  will  depend on our ability to
demonstrate  that our products satisfy  applicable  regulatory  requirements.  A
failure to demonstrate that our products meet applicable government  regulations
could make it impossible to sell our products in a particular country.

                                    EMPLOYEES

     In  connection  with  the  bankruptcy  of  Blue  Industries  SAS  and  Blue
Industries  SA described in Item 3 below,  all employees of our French and Swiss
subsidiaries were terminated.  We currently have one part-time employee,  who is
the executive officer of our company.

                            RESEARCH AND DEVELOPMENT

     In  the  year  ended  December  31,  2003,  we  spent  $0 on  research  and
development activities.


ITEM 2. DESCRIPTION OF PROPERTY

     We do not own any real  property.  As a result  of the  bankruptcy  of Blue
Industries  SAS and  Blue  Industries,  SA,  we  have  relocated  our  principal
executive offices to.222 Lakeview Ave, PMB 435, West Palm Beach, FL 33401


ITEM 3. LEGAL PROCEEDINGS.

     On April 6, 2003, we filed a bankruptcy  petition  under French law for the
liquidation of Blue Industries  SAS, our principal  operating  subsidiary,  with
Tribunal de Commerce,  Annecy,  France (Case No. 3290).  In connection  with the
filing of this petition,  Jean Blanchard, a court appointed liquidator,  assumed
control over  substantially  all of the operating assets and liabilities of Blue
Industries SAS.



                                       9
<PAGE>



     If the French police are able to locate the property that was stolen in the
burglary of our Pringy  facility and compel the prompt return of such  property,
we may be able to dismiss the bankruptcy  case. But we will only be able to take
such action if the property has been stored under  conditions  that would permit
the eventual resale to customers in the ordinary  course of business.  Likewise,
we may be able to dismiss the bankruptcy  case if we can negotiate an acceptable
agreement with our insurance carrier with respect to the theft loss. Since there
is no assurance that the police will be able to find the stolen property or that
our  insurance  carrier  will decide to honor the theft loss claim,  there is no
assurance that any amounts the liquidator ultimately recovers will be sufficient
to permit the  dismissal of the  bankruptcy  petition for Blue  Industries  SAS.
Therefore,  we expect the theft and the associated  bankruptcy  action to have a
material adverse impact on our business, properties and prospects.

     In 2003,  we also  filed a  bankruptcy  petition  under  Swiss  law for the
liquidation of Blue Industries, SA, in Geneva, Switzerland.

     During  2003,  both our Fench and our Swiss  subsidiaries  were  liquidated
pursuant to these bankruptcy filings.


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

     There were no matters submitted to a vote by our stockholders during 2003..



                                     PART II

ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

Market price data

     Our shares  have been  quoted on the OTC  Bulletin  Board  since the fourth
quarter of 2001.  Our trading symbol was changed to BLII in October 2002 when we
implemented a 1 share for 20 reverse split. Previously, our trading symbols were
BLUI and BTCS. The following table provides  information on the high and the low
prices for our shares for each quarter.

Fiscal 2002                                   High               Low
  4th Quarter                                $1.47             $0.20

Fiscal 2003                                   High               Low
  1st Quarter                                $2.20             $0.20
  2nd Quarter                                $0.80             $0.45
  3rd Quarter                                $1.25             $0.30
  4th Quarter                                $1.01             $0.35


Holders of Common Stock

     On November 3, 2004, we had approximately 430 stockholders of record and an
indeterminate number of beneficial owners who hold shares in brokerage and other
custodial accounts.

Dividends

     There are no restrictions in our Articles of  Incorporation  or bylaws that
restrict us from  declaring  dividends.  The Nevada Revised  Statutes,  however,
prohibit  us  from  declaring  dividends  where,  after  giving  effect  to  the
distribution:

     o    We would not be able to pay our debts as they  become due in the usual
          course of business; or
     o    Our total assets would be less than the sum of our total  liabilities,
          plus the  amount  that  would be  needed  to  satisfy  the  rights  of
          shareholders who have preferential  rights superior to those receiving
          the distribution.



                                       10
<PAGE>



     We have  never  paid any cash  dividends  on our  capital  stock and do not
anticipate paying cash dividends in the foreseeable  future.  Our current policy
is to retain any earnings in order to finance the  expansion of our  operations.
Our  board of  directors  will  determine  future  declaration  and  payment  of
dividends,  if any, in light of the  then-current  conditions they deem relevant
and in accordance with the Nevada Revised Statutes.

Recent sales of unregistered securities

     During  the  fourth  quarter  of  2002,  we  sold  235,670  shares  of  our
post-reverse split common stock in private placement  transactions at a price of
$2 per share for gross  proceeds of $471,340.  These  securities  were sold to a
total of 42 non-US  persons in reliance on the exemption from  registration  set
forth in  Securities  and  Exchange  Commission  Regulation  S. Each sale was an
offshore transaction. Each purchaser certified that he or she: (a) is not a U.S.
person;  (b) will not resell the purchased  securities unless the resale is made
in accordance  with the  provisions  of  Regulation S, pursuant to  registration
under the Act, or pursuant to an available exemption from registration; (c) will
not  engage in  hedging  transactions  with  regard to our  securities;  and (d)
understands  that we will refuse to register any transfer of the securities that
is not in compliance  with the  requirements  of applicable  law. Each purchaser
also  confirmed his or her intention to acquire our  securities  for  investment
only and not with a view toward  distribution.  Each investor was given adequate
access  to  sufficient  information  about  our  company  to  make  an  informed
investment  decision.   All  certificates  issued  to  non-US  persons  bear  an
appropriate restrictive legend.

     In December  2002, we issued  2,095,000  shares of our  post-reverse  split
common  stock  to  19  employees,   consultants  and  advisors  in  compensatory
transactions.  Four of the  employees,  consultants  and  advisors  who received
shares in  compensatory  transactions  are  citizens or  residents of the United
States. The other 15 employees, consultants and advisors are non-US persons.

     We conducted the  distribution to U.S. persons in reliance on the exemption
from  registration  set forth in Section 4(2) of the Act. Each  purchaser was an
accredited   investor  who  had  a   long-standing   employment   or  consulting
relationship  with our company.  Each  purchaser  represented  his  intention to
acquire  the  securities  for  investment  only  and  not  with  a  view  toward
distribution. Each purchaser was given adequate access to sufficient information
about our company to make an informed investment decision.  We did not engage in
general  solicitation with respect to the distribution.  All certificates issued
to US persons bear an appropriate restrictive legend.

     We  conducted  the  distribution  to  non-US  persons  in  reliance  on the
exemption  from  registration  set forth in Securities  and Exchange  Commission
Regulation S. Each sale was an offshore  transaction.  Each purchaser  certified
that  he or she:  is not a U.S.  person;  (b)  will  not  resell  the  purchased
securities  unless  the  resale is made in  accordance  with the  provisions  of
Regulation  S,  pursuant  to  registration  under  the Act,  or  pursuant  to an
available   exemption  from  registration;   (c)  will  not  engage  in  hedging
transactions  with regard to our securities;  and (d)  understands  that we will
refuse to register any transfer of the securities that is not in compliance with
the  requirements  of applicable  law. Each  purchaser also confirmed his or her
intention  to acquire our  securities  for  investment  only and not with a view
toward  distribution.  Each  investor was given  adequate  access to  sufficient
information  about our  company to make an  informed  investment  decision.  All
certificates issued to non-US persons bear an appropriate restrictive legend.

     During the first quarter of 2003, we sold 46,368 shares of our common stock
in private placement  transactions at a price of $2 per share for gross proceeds
of $92,736.  During the second  quarter of 2003,  we sold 750,000  shares of our
common stock in private placement transactions at a price of $0.40 per share for
gross  proceeds of $300,000.  During the fourth  quarter of 2003, we sold 25,000
shares of our common stock in private placement transactions at a price of $0.40
per share for gross  proceeds of $10,000.  All of these  transactions  were with



                                       11
<PAGE>



non-US  persons.  In June 2003,  we issued  64,014 shares of our common stock to
consultants and advisors in compensatory transactions valued at $0.40 per share,
for a total value of $25,606. These consultants and advisors are non-US persons.

     We  conducted  the  distribution  to  non-US  persons  in  reliance  on the
exemption  from  registration  set forth in Securities  and Exchange  Commission
Regulation S. Each sale was an offshore  transaction.  Each purchaser  certified
that  he or she:  is not a U.S.  person;  (b)  will  not  resell  the  purchased
securities  unless  the  resale is made in  accordance  with the  provisions  of
Regulation  S,  pursuant  to  registration  under  the Act,  or  pursuant  to an
available   exemption  from  registration;   (c)  will  not  engage  in  hedging
transactions  with regard to our securities;  and (d)  understands  that we will
refuse to register any transfer of the securities that is not in compliance with
the  requirements  of applicable  law. Each  purchaser also confirmed his or her
intention  to acquire our  securities  for  investment  only and not with a view
toward  distribution.  Each  investor was given  adequate  access to  sufficient
information  about our  company to make an  informed  investment  decision.  All
certificates issued to non-US persons bear an appropriate restrictive legend.


ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.

     We had no  revenue  during  the year  ended  December  31,  2003.  While we
generated  $1,373,468 in revenue  during the year ended  December 31, 2002,  our
revenue was sporadic and the  implementation of our business plan was impeded by
numerous  economic and  technical  problems  that are  discussed  Item 1 of this
report.

     Due to our history of operating losses,  the theft of substantial  property
from our Pringy facility,  our decision to file a bankruptcy  petition on behalf
of our principal operating  subsidiary and the other uncertainties  discussed in
this  report,  there is  substantial  uncertainty  over our  ability to continue
functioning as a going  concern.  The  short-term  plan of operations  discussed
below is subject to numerous contingencies and uncertainties and we can offer no
assurance that our company or our business will survive.

     Bankruptcy of Blue Industries SAS and Blue Industries,  SA. As described in
Items 1 and 3 of this report,  we filed a bankruptcy  petition  under French law
for the liquidation of Blue Industries SAS, our French  subsidiary,  on April 8,
2003, and we filed a bankruptcy  petition under Swiss law for the liquidation of
Blue Industries SA, our Swiss  subsidiary.  At December 31, 2002 and at the date
of the bankruptcy  filing,  the bulk of our consolidated  assets and liabilities
were assets and liabilities of Blue Industries SAS.

LIQUIDITY AND FINANCIAL CONDITION

     We had $3,200 in cash at  December  31,  2003,  as  compared  to $63,600 at
December  31,  2002.  At December  31,  2003,  our working  capital  deficit was
$132,400,  as compared to $488,700 at December  31,  2002.  Our working  capital
deficit  declined  principally due to the bankruptcy  liquidations of our French
and Swiss subsidiaries during 2003.

     The bankruptcy  petition we filed on behalf of Blue Industries SAS resulted
in the  surrender  of $397,000 in  operating  assets to the  liquidator  and the
discharge of $306,000 in operating liabilities. Overall, the Blue Industries SAS
bankruptcy  improved our working position by  approximately  $12,000 and reduced
our stockholders' equity by approximately $91,000. We do not believe our company
is likely to be contingently liable for the accumulated operating liabilities of
Blue Industries SAS.

RESULTS OF OPERATIONS

     We  realized  $0 and  $293,300  in gross  profit  from  product  sales  and
consulting services in the years ended December 31, 2003 and 2002, respectively.



                                       12
<PAGE>



     We  incurred a net loss of  ($401,800)  and  ($2,782,000),  or ($0.08)  and
($0.81) per share, for the years ended December 31, 2003 and 2002, respectively.
Our net cash used by operating  activities  during the years ended  December 31,
2003 and 2002 was $186,400 and $1,877,300, respectively.

     We have significantly  reduced our staff and operating overhead as a result
of the bankruptcies of Blue Industries SAS and Blue Industries, SA. Therefore we
do not believe that our results of operations  for the years ended  December 31,
2003 and 2002 are a reliable  indicator of our future operating  results.  If we
are able to successfully implement the plan of operations described below we can
expect  increased  revenues and decreased  costs during the current fiscal year.
But we are presently unable to predict the magnitude of the revenue increases or
the overall amount of the anticipated cost savings.

GOING CONCERN QUALIFICATION

     At December 31,  2003,  we had  accumulated  losses of  ($3,276,300)  and a
working capital deficit of ($132,400).  Accordingly,  the independent  auditors'
report on our financial statements for the year ended December 31, 2003 contains
a fourth explanatory  paragraph that our financial statements have been prepared
assuming that our company will continue as a going concern and that the problems
discussed above raise substantial doubt about our ability to continue as a going
concern.

PLAN OF OPERATIONS

     We are likely to incur operating losses for the foreseeable future. We have
approximately  $3,000  in cash at the  date of  this.  We will  need  additional
capital to pay our operating expenses and finance our planned expansion.

     Over the next six months, we intend to finance our business operations from
the proceeds of our expected future private placement.

     If  revenues  from  product  sales  do not  materialize  or are  less  than
presently  anticipated,   we  will  require  additional  funds  to  finance  our
day-to-day  operations.  We will need  capital to pay our  day-to-day  operating
costs,  finance inventories and pay for the expansion of our sales and marketing
activities.  We may also need  additional  capital to finance the acquisition of
complementary  assets,   technologies  and  businesses.   We  intend  to  pursue
additional financing as opportunities arise.

     Our ability to obtain additional financing in the future will be subject to
a variety of  uncertainties.  The inability to raise  additional  funds on terms
favorable  to us,  or at  all,  would  have a  material  adverse  effect  on our
business,  financial  condition and results of  operations.  If we are unable to
obtain  additional  capital when  required,  we will be forced to scale back our
planned expenditures, which would adversely affect our growth prospects.

     We have the  authority  to issue  50,000,000  shares  of  Common  Stock and
10,000,000  shares  of a  blank  check  preferred  stock  without  a vote of the
stockholders.  We had 4,870,714 shares of Common Stock issued and outstanding on
the date of this report. Our Board has the authority to issue all or any part of
our authorized and unissued capital stock to raise additional capital or finance
acquisitions. The Board also has the authority to fix the rights, privileges and
preferences  of the  holders of  Preferred  Stock,  which may be superior to the
rights of holders  of the  Common  Stock.  We expect to seek  additional  equity
capital in the future and we may attempt to acquire other companies or operating
assets as we develop our business and implement our growth strategy.  Any future
issuances of common or preferred stock will dilute the ownership interest of our
current   shareholders  and  may  dilute  the  book  value  of  our  outstanding
securities.



                                       13
<PAGE>



     Due to our limited  operating  history,  our business  model and our growth
strategy are  unproven.  We cannot be certain  that our  business  model and our
growth  strategy  will be  successful  or  that  we  will  be  able  to  compete
effectively, achieve market acceptance or otherwise address the risks associated
with our existing and proposed business activities.


ITEM 7. FINANCIAL STATEMENTS.

     The following consolidated financial statements for the year ended December
31, 2003 are included in this Annual Report on Form 10- KSB:

                          INDEX TO FINANCIAL STATEMENTS




Independent Auditors' Reports...............................................F-2

Consolidated Balance Sheets.................................................F-3

Consolidated Statements of Operations and Comprehensive Income (Loss).......F-4

Consolidated Statements of Stockholders' Equity (Deficiency)................F-5

Consolidated Statements of Cash Flows.......................................F-7

Notes to Consolidated Financial Statements..................................F-8

























                                                                             F-1

<PAGE>



                          INDEPENDENT AUDITORS' REPORT


The Board of Directors and Stockholders
Blue Industries, Inc.


We  have  audited  the   accompanying   consolidated   balance  sheets  of  Elva
International,  Inc.,  (the  "Company") as of December 31, 2003 and 2002 and the
related  consolidated  statements of operations and comprehensive income (loss),
stockholders'  equity  (deficiency)  and cash flows for each of the two years in
the period ended December 31, 2003. These consolidated  financial statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and  perform  the  audit  to  obtain  reasonable  assurance  about  whether  the
consolidated  financial statements are free of material  misstatement.  An audit
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the  consolidated  financial  statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly, in all material  respects,  the financial  position of the Company as of
December 31, 2003 and 2002 and the results of its  operations and its cash flows
for each of the two years in the period ended  December 31, 2003,  in conformity
with U.S. generally accepted accounting principles.

The accompanying  consolidated  financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Note 4 to the
consolidated financial statements,  the Company has experienced net losses since
inception.   The  Company's  financial  position  and  operating  results  raise
substantial doubt about its ability to continue as a going concern. Management's
plans  with  regard  to  these  matters  are  also  described  in  Note  4.  The
consolidated  financial  statements  do not include any  adjustments  that might
result from the outcome of this uncertainty.




/s/Durland & Company, CPAs, P.A.
Durland & Company, CPAs, P.A.

Palm Beach, Florida
October 21, 2004





                                                                             F-2

<PAGE>



<TABLE>
<CAPTION>
                              Blue Industries, Inc.
                           Consolidated Balance Sheets
                                  December 31,



                                                                                       2003                2002
                                                                                -----------------  -----------------
<S>                                                                             <C>                <C>
                          ASSETS
CURRENT ASSETS
  Cash and equivalents                                                          $           3,163  $          63,600
  Accounts receivable (net of allowance of $0 and $30,063)                                      0            338,088
  Accounts receivable - related parties                                                         0            103,313
   Inventory                                                                                    0            687,019
                                                                                -----------------  -----------------
          Total current assets                                                              3,163          1,192,020
                                                                                -----------------  -----------------
PROPERTY AND EQUIPMENT
  Software                                                                                      0             13,405
  Computers and equipment                                                                       0            306,906
        Less: accumulated depreciation                                                          0            (37,936)
                                                                                -----------------  -----------------
          Net property and equipment                                                            0            282,375
                                                                                -----------------  -----------------
OTHER ASSETS
  Deposits and other assets                                                                     0             49,073
  Patent                                                                                        0              3,969
        Less:  accumulated amortization                                                         0               (128)
                                                                                -----------------  -----------------

          Net other assets                                                                      0             52,914
                                                                                -----------------  -----------------
Total Assets                                                                    $           3,163  $       1,527,309
                                                                                =================  =================
        LIABILITIES AND STOCKHOLDERS' EQUITY ( DEFICIENCY)
CURRENT LIABILITIES
   Accounts payable                                                             $          22,507  $         707,170
   Accrued Expenses
       Payroll and taxes                                                                   25,000            155,155
       VAT tax payable                                                                          0            105,274
   Due to a former officer                                                                 66,088             66,088
   Short-term debt                                                                         22,000            647,029
                                                                                -----------------  -----------------

          Total current liabilities                                                       135,595          1,680,716
                                                                                -----------------  -----------------
Total Liabilities                                                                         135,595          1,680,716
                                                                                -----------------  -----------------
STOCKHOLDERS' EQUITY (DEFICIENCY)
   Preferred stock, $0.0001 par value, authorized 10,000,000 shares;
      none issued and outstanding                                                               0                  0
   Common stock, $0.0001 par value, authorized 50,000,000 shares;
      4,870,714 and 3,985,332 issued and outstanding shares                                   487                399
   Additional paid-in capital                                                           3,143,400          2,715,147
   Accumulated comprehensive income (loss)                                                      0              5,581
   Deficit                                                                             (3,276,319)        (2,874,534)
                                                                                ------------------------------------
          Total stockholders' equity (deficiency)                                        (132,432)          (153,407)
                                                                                -----------------  -----------------
Total Liabilities and Stockholders' Equity (Deficiency)                         $           3,163  $       1,527,309
                                                                                =================  =================
</TABLE>





     The accompanying notes are an integral part of the financial statements


                                                                             F-3
<PAGE>



<TABLE>
<CAPTION>
                              Blue Industries, Inc.
      Consolidated Statements of Operations and Comprehensive Income (Loss)
                             Year Ended December 31,


                                                                                       2003                2002
                                                                                -----------------  -----------------
<S>                                                                             <C>                <C>
REVENUES                                                                        $               0  $       1,373,468
                                                                                -----------------  -----------------
COST OF SALES                                                                                   0          1,080,139
                                                                                -----------------  -----------------
          Gross margin                                                                          0            293,329
                                                                                -----------------  -----------------
OPERATING EXPENSES
    Salaries                                                                                    0            464,094
    Depreciation and amortization                                                               0             34,227
    General and administrative                                                            259,537          2,484,749
    Research and development                                                                    0                  0
                                                                                -----------------  -----------------
          Total operating expenses                                                        259,537          2,983,070
                                                                                -----------------  -----------------
 Operating Loss                                                                          (259,537)        (2,689,741)
                                                                                -----------------  -----------------
OTHER INCOME (EXPENSE):
    Interest income                                                                             0                  1
    Interest expense                                                                            0            (42,347)
    Operating loss from disposed operations                                            (1,184,778)                 0
    Gain (loss) on bankruptcy of subsidiaries                                           1,042,530                  0
    Foreign currency transaction gain (loss)                                                    0            (23,130)
    Reserve for bad debt                                                                        0            (26,750)
                                                                                -----------------  -----------------
          Total other income (expense)                                                   (142,248)           (92,226)
                                                                                -----------------  -----------------

        Net loss                                                                         (401,785)        (2,781,967)

Other comprehensive income (loss):
    Foreign currency translation gain (loss)                                               (5,581)             2,170
                                                                                -----------------  -----------------

Comprehensive loss                                                              $        (407,366) $      (2,779,797)
                                                                                =================  =================

Net loss per common share                                                       $           (0.08) $           (0.81)
                                                                                =================  =================


Weighted average number of common shares outstanding                                    4,591,799          3,434,230
                                                                                =================  =================
</TABLE>







     The accompanying notes are an integral part of the financial statements


                                                                             F-4
<PAGE>



<TABLE>
<CAPTION>
                              Blue Industries, Inc.
          Consolidated Statements of Stockholders' Equity (Deficiency)



                                                                                    Add'l.
                                              Number of           Common            Paid-in
                                               Shares             Stock             Capital
                                            ---------------   --------------   -----------------
<S>                                         <C>               <C>              <C>
BEGINNING BALANCE,
January 1, 2001                                       1,000   $       59,880   $               0

Year ended December 31, 2001:
   Recapitalization                               7,599,000          (52,280)             52,280
   Stock subscription received                            0                0                   0
   Distribution of assets at acquisition                  0                0          (3,864,563)
   Settlement of debt                                     0                0              31,070
   Reverse acquisition                           10,062,000           10,062             (72,130)
   Other comprehensive income (loss)                      0                0                   0
   Net loss                                               0                0                   0
                                            ---------------   --------------   -----------------

BALANCE, December 31, 2001                       17,662,000           17,662          (3,853,343)

Year ended December 31, 2002:
   Shares issued for cash                         5,701,431            5,701           1,281,528
   Note forgiveness                                       0                0           3,864,563
   Shares issued for inventory                    9,757,489            9,758             397,355
   1 for 20 reverse split                       (31,464,874)         (31,465)             31,465
   Amended par value                                      0           (1,490)              1,490
   Shares issued for services                     2,095,000              210             523,540
   Shares issued for cash                           234,286               23             468,549
   Other comprehensive income (loss)                      0                0                   0
   Net loss                                               0                0                   0
                                            ---------------   --------------   -----------------


BALANCE, December 31, 2002                        3,985,332              399           2,715,147

Year ended December 31, 2003:
   Shares issued for cash                            46,368                5              92,731
   Shares issued for cash                           775,000               77             309,922
   Shares issued for services                        64,014                6              25,600
   Comprehensive income (loss)                            0                0                   0
(401,785)ss                                               0                0                   0
                                            ---------------   --------------   -----------------

ENDING BALANCE, December 30, 2003                 4,870,714   $          487   $       3,143,400
                                            ===============   ==============   =================
</TABLE>









     The accompanying notes are an integral part of the financial statements


                                                                             F-5
<PAGE>



<TABLE>
<CAPTION>
                              Blue Industries, Inc.
          Consolidated Statements of Stockholders' Equity (Deficiency)


                           Accum.                                   Total
       Stock               Comp.             Retained           Stockholders'
   Subscriptions           Income            Earnings               Equity
    Receivable             (Loss)           (Deficit)            (Deficiency)
-------------------    --------------   ------------------   --------------------
<C>                    <C>              <C>                  <C>

$           (29,940)   $            0   $          (31,070)  $             (1,130)


                  0                 0                    0                      0
             29,940                 0                    0                 29,940
                  0                 0                    0             (3,864,563)
                  0                 0                    0                 31,070
                  0                 0               16,196                (45,872)
                  0             3,411                    0                  3,411
                  0                 0              (77,693)               (77,693)
-------------------    --------------   ------------------   --------------------

                  0             3,411              (92,567)            (3,924,837)


                  0                 0                    0              1,287,229
                  0                 0                    0              3,864,563
                  0                 0                    0                407,113
                  0                 0                    0                      0
                  0                 0                    0                      0
                  0                 0                    0                523,750
                  0                 0                    0                468,572
                  0             2,170                    0                  2,170
                  0                 0           (2,781,967)            (2,781,967)
-------------------    --------------   ------------------   --------------------


                  0             5,581           (2,874,534)              (153,407)


                  0                 0                    0                 92,736
                  0                 0                    0                309,999
                  0                 0                    0                 25,606
                  0            (5,581)                   0                 (5,581)
                  0             (401,785)
-------------------    --------------

$                 0    $            0   $       (3,276,319)  $           (132,432)
===================    ==============   ==================   ====================
</TABLE>









     The accompanying notes are an integral part of the financial statements


                                                                             F-6
<PAGE>




<TABLE>
<CAPTION>
                              Blue Industries, Inc.
                      Consolidated Statements of Cash Flows
                             Year Ended December 31,


                                                                                       2003                2002
                                                                                -----------------  -----------------
<S>                                                                             <C>                <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
        Net loss                                                                        (401,785)         (2,781,967)
Adjustments to reconcile net loss to net cash used by operating activities:
     Depreciation and amortization                                                             0              34,227
     Common stock issued for services                                                     25,606             523,750
     Foreign exchange transaction gain (loss)                                                  0              23,130
     Reserve for bad debt                                                                      0              26,750
    Operating loss from disposed operations                                            1,184,778                   0
     Gain on bankruptcy of subsidiary                                                 (1,042,530)                  0
Changes in operating assets and liabilities:
     (Increase) decrease in accounts receivable                                                0            (327,572)
     (Increase) decrease in inventory                                                          0            (222,914)
     (Increase) decrease in deposits and other assets                                          0             (44,308)
     Increase (decrease) in accounts payable                                              22,507             650,464
     Increase (decrease) in VAT tax payable                                                    0              93,673
     Increase (decrease) in salaries and payroll and taxes                                25,000             147,455
                                                                                ----------------   -----------------

Net cash  provided (used) by operating activities                                       (186,424)         (1,877,312)
                                                                                ----------------   -----------------

CASH FLOW FROM INVESTING ACTIVITIES:
     Payment of accounts payable of subsidiaries by parent                              (274,854)                  0
     Purchase of property and equipment                                                        0            (203,165)
     Increase expenditure application patent                                                   0              (3,772)
                                                                                ----------------   -----------------

Net cash provided (used) by investing activities                                        (274,854)           (206,937)
                                                                                ----------------   -----------------

CASH FLOW FROM FINANCING ACTIVITIES:
     Related party advances                                                                    0             (91,925)
     Proceeds of  long term debt - related party                                               0             575,709
     Proceeds from short-term loan - third party                                          22,000                   0
     Issuance of common stock for cash                                                   402,735           1,755,801
                                                                                ----------------   -----------------

Net cash provided by financing activities                                                424,735           2,239,585
                                                                                ----------------   -----------------

Effect of exchange rates on cash                                                         (23,894)           (110,016)
                                                                                ----------------   -----------------

Net increase (decrease) in cash and equivalents                                          (60,437)             45,320

CASH and equivalents, beginning of period                                                 63,600              18,280
                                                                                ----------------   -----------------

CASH and equivalents, end of period                                             $          3,163   $          63,600
                                                                                ================   =================

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Interest paid in cash                                                           $              0   $               0
                                                                                ================   =================

Non-Cash Financing Activities:
  Forgiveness of debt                                                           $              0   $       4,257,430
                                                                                ================   =================
</TABLE>










     The accompanying notes are an integral part of the financial statements


                                                                             F-7
<PAGE>



                              Blue Industries, Inc.
                   Notes to Consolidated Financial Statements

(1)  Summary of Significant Accounting Principles
     The Company Blue Industries,  Inc., (the "Company"), was incorporated under
     the laws of the State of Nevada on April 5, 2000 as  Burrard  Technologies,
     Inc. ("Burrard") and was involved in software development. During 2001, the
     Company  discontinued  the software  development  and became inactive until
     December 18, 2001, when it acquired all the issued and  outstanding  shares
     of Technocall S.A. ("Technocall"), a Swiss company.

     Technocall SA, a proprietary  micro-calculator  and  electronic  management
     system that regulates and controls the water  treatment  process,  had been
     inactive  until  September  2001,  at which time it acquired all the assets
     comprising the Blue Industries water treatment  process.  On April 2, 2002,
     the Company changed its legal name to Blue Industries Inc.

     In March 2003, the Company formed Blue  Industries,  Inc., a new subsidiary
     under the laws of the state of Florida.  The  following  summarize the more
     significant accounting and reporting policies and practices of the Company:

          a)  Use  of  estimates  In  preparing   the   consolidated   financial
     statements,  management is required to make estimates and assumptions  that
     affect the reported amounts of assets and liabilities as of the date of the
     statements of financial  condition,  and revenues and expenses for the year
     then ended. Actual results may differ significantly from those estimates.

          b) Significant  acquisition  In September  2001,  Technocall  acquired
     substantially  all of the assets  comprising the Blue Industries  water and
     treatment  process from a then third party in exchange  for a  subordinated
     note payable in the amount of $4,288,500. The debt was subordinated against
     future indebtedness of the Company,  was unsecured,  non-interest  bearing,
     with no specific terms of repayment. At the date of acquisition, the assets
     held a carrying  value of  $423,937.  Subsequent  to the  acquisition,  the
     stockholder  agreed  to  forgive  $31,070  of the note  payable,  which was
     recorded as a reduction in the distribution of capital.

          On  December  18,  2001,  the Company  acquired  all of the issued and
     outstanding  shares of Technocall in exchange for 7.6 million common shares
     of the Company's common stock, in a reverse merger, which was accounted for
     as a reorganization of Technocall.

          c) Principles of consolidation The consolidated  financial  statements
     include  the  accounts  of  Blue  Industries,  Inc.  and its  wholly  owned
     subsidiary. Inter-company balances and transactions have been eliminated.

          d) Net loss per  common  share  Basic  net loss per  weighted  average
     common share is computed by dividing  the net loss by the weighted  average
     number of common shares outstanding during the period.

          e) Property and  equipment  All property and equipment are recorded at
     cost  and  depreciated  over  their  estimated  useful  lives,   using  the
     straight-line  method.  Upon sale or  retirement,  the  costs  and  related
     accumulated depreciation are eliminated from their respective accounts, and
     the  resulting  gain or loss is  included  in the  results  of  operations.
     Repairs and  maintenance  charges which do not increase the useful lives of
     the assets are charged to operations as incurred.  Depreciation expense was
     $0  and  $34,099  for  the  years  ended   December   31,  2003  and  2002,
     respectively.

          f) Cash and  equivalents  The company  considers  investments  with an
     initial maturity of three months or less as cash equivalents.




                                                                             F-8

<PAGE>



                              Blue Industries, Inc.
                   Notes to Consolidated Financial Statements

(1)  Summary of Significant Accounting Principles (Continued)
          g)  Patents  Patents  are  recorded  at cost  and are  amortized  on a
     straight-line  basis over five years,  commencing in the period the patents
     are put into  service.  No  residual  value is  expected  at the end of the
     patents' useful lives.  Amortization  expense was $0 and $128 for the years
     ended December 31, 2002 and 2001, respectively.

          h)  Revenue  recognition  In 2002,  the  Company  entered  into  sales
     contracts with  companies in China and Thailand to supply units  containing
     the Blue  water  treatment  process  having  contract  values of 15 million
     Euros, (approximately  $15,350,000),  and $850,000,  respectively.  Revenue
     earned on these  contracts were recognized as the units are shipped and all
     aspects of performance  insofar as delivery and installation were complete,
     the price is fixed or determinable and the collection is probable.

          i) Foreign  currency  transaction and translation  gains (losses) As a
     Swiss company operating in Switzerland,  Technocall's  functional  currency
     was the Swiss franc.  Assets and  liabilities of Technocall were translated
     at the  exchange  rate in effect at the year end date,  while  revenue  and
     expenses were translated at the average exchange rate for the period. Gains
     or losses on translation are deferred as a separate component of capital.

          As a  French  company  operating  in  France,  Blue  Industries  SAS's
     functional currency was the Euro. Assets and liabilities of Blue Industries
     SAS were  translated  at the exchange  rate in effect at the year end date,
     while revenue and expenses were translated at the average exchange rate for
     the  period.  Gains or losses on  translation  are  deferred  as a separate
     component of capital.

          The  functional  currency of Blue  Industries,  Inc. on a consolidated
     basis was the Euro, and the Company's  reporting currency is the US Dollar.
     The  Company  translated  the  income  statement  items  using the  average
     exchange  rate for the  period and  balance  sheet  items  using the end of
     period  exchange rate,  except for equity items,  which were  translated at
     historical rates, in accordance with SFAS 52.

          j)  Research &  development  Research  and  development  expenses  are
     expensed in the period incurred.

          k)  Software  development  costs  In  accordance  with  SFAS  No.  86,
     "Accounting  for the  Cost of  Computer  Software  to be Sold,  Leased,  or
     Otherwise  Marketed",  development  costs  incurred  in  the  research  and
     development  of new  software  products  are  expensed  as  incurred  until
     technological  feasibility  in  the  form  of  a  working  model  has  been
     established.

          l) VAT tax  receivable/payable  In Switzerland and France,  as in many
     other countries,  the government  charges a Value Added Tax, (VAT), that is
     similar  in  nature  to  sales  tax  in  the  US.  There  are  three  major
     differences.  First is that VAT is charged at each point of sale. Second is
     that there are no  exemptions  from the  collection of VAT.  Finally,  each
     company files a VAT return with the government monthly reflecting the gross
     VAT  collected  and VAT paid.  If the VAT paid is  greater  than the amount
     collected,  the Company receives a refund from the government approximately
     three to five months later.

          m)  Comprehensive  income  The  Company  has  adopted  SFAS  No.  130,
     "Reporting Comprehensive Income", which establishes standards for reporting
     and  display  of  comprehensive  income,  its  components  and  accumulated
     balances.  The Company is disclosing  this  information on its Statement of
     Changes in Capital Deficit. Comprehensive income is comprised of net income
     (loss) and all  changes to capital  deficit  except  those  resulting  from
     investments by owners and distribution to owners.



                                                                             F-9

<PAGE>



                              Blue Industries, Inc.
                   Notes to Consolidated Financial Statements


(2)  Stockholders'  Equity  The  Company  has  authorized  50,000,000  shares of
     $0.0001 par value common stock and  10,000,000  shares of $0.0001 par value
     preferred  stock.  Rights and  privileges of the preferred  stock are to be
     determined  by the Board of Directors  prior to  issuance.  The Company had
     4,870,714 and  3,985,332  shares of common stock and no shares of preferred
     stock issued and outstanding at December 31, 2003 and 2002, respectively.

          In March 2002,  the  Company's  stockholders  approved a change to the
     Company's  authorized share capital to increase the authorized common stock
     to 50,000,000  shares at a par value of $0.001 per share,  and to authorize
     the creation of  100,000,000  shares of  preferred  stock at a par value of
     $0.001 per share.  In March 2002,  the  Company  issued  534,765  shares of
     common stock in connection  with a private  placement for gross proceeds of
     $957,229, the majority of which was used to purchase inventory.

          Immediately  prior to the acquisition of Technocall,  two stockholders
     of the  Company  surrendered  7,125,000  common  shares to the  Company for
     cancellation.  No consideration was paid on redemption of these shares. The
     fair value of the note payable to a former  Technocall  stockholder was not
     practicable  to  determine.  On April 2,  2002,  the  noteholder  agreed to
     forgive  the  balance  owing,  which  is  recorded  as a  reduction  to the
     distribution of capital and additional paid-in capital.

          In early  2002,  the Company  issued  5,701,431  shares of  restricted
     common  stock  for  $1,287,229  in  cash.   With  the  forgiveness  of  the
     acquisition  promissory note, the Company reversed the $3,864,563 charge to
     additional  paid-in  capital.  In early 2002, the Company issued  9,757,489
     shares of  restricted  common  stock in exchange  for  inventory  valued at
     $407,113,  as delivered.  In October 2002, the Company completed a 1 for 20
     reverse split of the then issued and outstanding  common shares,  resulting
     in the  retirement  of  31,464,874  shares.  In October  2002,  the Company
     amended the Articles of Incorporation to change the par value of the common
     stock from $0.001 to $0.0001 per share.  In the fourth  quarter  2002,  the
     Company  issued  2,095,000  shares  of  restricted  stock in  exchange  for
     services valued at $523,750,  or $0.25 per share.  This stock was issued to
     certain management and key consultants. The valuation was determined by the
     Board of  Directors  as a discount  to the then  market  price of $0.40 per
     share.  This was the only means by which the  Company  could  retain  these
     individuals  in order for the Company to  continue  to grow.  In the fourth
     quarter 2002, the Company issued 234,286 shares in exchange for $468,572 in
     cash.
          In  February  and March  2003,  the Company  issued  46,368  shares in
     exchange  for $92,736 in cash,  or $2 per share.  In May 2003,  the Company
     issued 750,000 shares in exchange for $300,000 in cash, or $0.40 per share.
     In June 2003,  the Company  issued 64,014 shares in exchange for $25,606 in
     services,  or $0.40 per share.  In October 2003,  the Company issued 25,000
     shares in exchange for $10,000 in cash, or $0.40 per share.


(3)  Income Taxes   The Company follows the provisions of Statement of Financial
     Accounting Standards ("SFAS") No. 109, "Accounting for Income Taxes", which
     requires the Company to recognize  deferred tax  liabilities and assets for
     the expected future tax consequences of events that have been recognized in
     the Company's  consolidated  financial  statements or tax returns using the
     liability  method.  Under this method,  deferred tax liabilities and assets
     are  determined  based on the temporary  differences  between the financial
     statement  carrying  amounts and tax bases on assets and liabilities  using
     enacted  tax rates in effect  in the  years in which  the  differences  are
     expected to reverse.


                                                                            F-10
<PAGE>


                              Blue Industries, Inc.
                   Notes to Consolidated Financial Statements


(3)  Income  Taxes  (Continued)  The  amount  recorded  as  deferred  tax asset,
     cumulative as of December 31, 2003 and 2002 is approximately $1,310,500 and
     $1,150,000,  respectively,  which  represents the amount of tax benefits of
     the loss carry-forwards.  The Company has established a valuation allowance
     for this deferred tax asset of $1,310,500  and  $1,150,000,  as the Company
     has no history of profitable  operations.  The  significant  components net
     deferred tax asset as of December 31, 2002 and 2001 are:

                                      2003                    2002
                             ----------------------   ---------------------
Net operating losses         $            1,310,500   $           1,150,000
Valuation allowance                      (1,310,500)             (1,150,000)
                             ----------------------   ---------------------
Net deferred tax asset       $                    0   $                   0
                             ======================   =====================

          Deferred  income tax assets and the  related  valuation  allowance  of
     Burrard  totaled  $55,100  at the  date of  recapitalization.  The  Company
     evaluates its valuation  allowance  requirements  based on projected future
     operations. When circumstances change resulting in a change in management's
     judgment regarding recoverability of deferred tax assets, the impact of the
     change on the valuation allowance is reflected in current income.

(4)  Going Concern These  financial  statements have been prepared in accordance
     with United States generally accepted accounting principles applicable to a
     going  concern,  which  contemplates  the  realization  of  assets  and the
     satisfaction  of  liabilities  and  commitments  in the  normal  course  of
     business.  The  conditions  raising  substantial  doubt about the Company's
     ability to  continue  as a going  concern  are the  $3,276,300  accumulated
     deficit,  negative  working  capital  balance  and  the  theft  of  assets,
     principally  inventory,  in March 2003 and the  bankruptcy of the Company's
     two major operating  subsidiaries . The Company's  financial  statements do
     not   include   any   adjustments   related  to  the   recoverability   and
     classification of recorded asset amounts or the amounts and  classification
     of  liabilities  that may be  necessary  should  the  Company  be unable to
     continue as a going concern.

(5)  Related Party Transactions
               a) Long-term debt Amounts due to a former director and officer of
          the Company are unsecured, non-interest bearing and due on demand.

(6)  Bankruptcy  of   Subsidiaries   The  Company   elected  to  liquidate  Blue
     Industries, SAS and Blue Industries, SA, its French and Swiss subsidiaries.
     These  bankruptcies  were  completed  in 2003.  As a  result,  the  Company
     recorded a $1,042,500 gain.


                                                                            F-11




<PAGE>


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

None



                                    PART III


ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE
        WITH SECTION 16(a) OF THE EXCHANGE ACT.

     Our  Company's  directors  and  executive  officers are  identified  in the
following table:

Name                     Age            Positions
---------------------------------------------------------------------
Patrick Gouverneur        54       President, Chief Executive Officer
                                   and Director


     At the date of this Report,  our Mr. Gouverneur is the only employee of our
Company.  Biographical  information  on our officers and  directors is set forth
below.

     Patrick Gouverneur has served as our president and as a member of our board
of directors since October 18, 2002. Before joining our company,  Mr. Gouverneur
was employed for 6 years as the president of CIF International  Corp., a Florida
real estate management firm. Mr. Gouverneur is a graduate of the Lycee Ste Barbe
and the European Business School, both in Paris, France.

INFORMATION CONCERNING THE BOARD OF DIRECTORS AND ITS COMMITTEES

     We have no compensation  committee,  no audit committee,  and no nominating
committee.  Decisions  concerning  nominees for Director and  executive  officer
compensation for fiscal 2003 were made by the full Board of Directors.

     The Board of Directors  held regular  meetings and took action by unanimous
written  consent  during the fiscal year ended  December 31, 2003,  in which all
members of the board of directors took part.

     Our  Directors  are elected  annually and hold office until the next annual
meeting of our stockholders or until their successors are elected and qualified.
Officers  are  elected  annually  and  serve at the  discretion  of the Board of
Directors.  There is no family  relationship  between any of our  directors  and
executive officers. Board vacancies are filled by a majority vote of the Board.

SECTION 16(a) BENEFICIAL OWNERSHIP AND REPORTING COMPLIANCE

     Section  16(a) of the Exchange Act requires our  officers,  directors,  and
persons who beneficially own more than ten percent of our equity securities,  to
file  reports of  ownership  and changes in ownership  with the  Securities  and
Exchange  Commission and provide  copies of those reports to our company.  Based
solely on our review of the  copies of the  reports  provided  to us, we believe
that all of our officers,  directors and principal stockholders failed to comply




                                       24
<PAGE>


on a timely basis with the  requirements  of Section 16(a) during the year ended
December  31,  2002.  The  following  schedule  identifies  each  person who was
required to file one or more reports  pursuant to Section  16(a) of the Exchange
Act and failed to file the  required  report.  For  purposes  of the table,  all
transactions  prior to October  28,  2002 have been  restated  to give pro forma
effect to a 1 for 20 reverse split that was effected on that date.


<TABLE>
<CAPTION>
Advanced Technologies
Development Ltd. (1)                 Shares           Required      Reportable         Report            Report
   (10% Stockholder)            Purchased (Sold)       Report       Event Date        Due Date         Filing Date
------------------------------------------------------------------------------------------------------------------
<S>                                <C>                 <C>          <C>              <C>                <C>
     Initial Statement               190,000           Form 3       17-Dec-2001      27-Dec-2001        Not filed
     Change in Ownership              25,000           Form 4       03-Jan-2002      10-Feb-2002        Not filed
     Change in Ownership             487,875           Form 4       30-May-2002      10-Jun-2002        Not filed
     Change in Ownership            (487,875)          Form 4       30-May-2002      10-Jun-2002        Not filed
     Change in Ownership            (140,123)          Form 4       21-Jun-2002      10-Jul-2002        Not filed
     Annual Statement                                  Form 5                        15-Feb-2003        Not filed
</TABLE>
------------------------
(1)  Includes   shares   registered  in  the  names  of  Advanced   Technologies
     Development Ltd. and Herve Gallion.


<TABLE>
<CAPTION>
Mohammed Al Yamani (5)               Shares           Required      Reportable         Report            Report
   (10% Stockholder)                Purchased          Report       Event Date        Due Date         Filing Date
------------------------------------------------------------------------------------------------------------------
<S>                                <C>                 <C>          <C>              <C>                <C>
     Stock Acquisition               126,920           Form 3       30-May-2002      10-Jun-2002        Not filed
     Stock Acquisition               125,000           Form 3       30-Aug-2002      10-Sep-2002        Not filed
     Stock Acquisition               250,000           Form 3       19-Dec-2002      10-Jan-2003        Not filed
     Annual Statement                                  Form 5                        15-Feb-2003        Not filed
</TABLE>
----------------------
(5)  Includes  shares  registered  in the names of Mohammed Al Yamani and Famoya
     Holdings BV.

<TABLE>
<CAPTION>
Bernard Bouverot                     Shares           Required      Reportable         Report            Report
   (Former Officer)                 Purchased          Report       Event Date        Due Date         Filing Date
------------------------------------------------------------------------------------------------------------------
<S>                                <C>                 <C>          <C>              <C>                <C>
     Initial Statement                25,000           Form 4       30-May-2002      10-Jun-2002        Not filed
     Change in Ownership              95,000           Form 4       19-Dec-2002      10-Jan-2003        Not filed
     Annual Statement                                  Form 5                        15-Feb-2003        Not filed
</TABLE>
----------------------

<TABLE>
<CAPTION>
Patrick Gouverneur                   Shares           Required      Reportable         Report            Report
   (Officer and Director)           Purchased          Report       Event Date        Due Date         Filing Date
------------------------------------------------------------------------------------------------------------------
<S>                                <C>                 <C>          <C>              <C>                <C>
     Initial Statement                80,000           Form 3       19-Dec-2002      10-Jan-2003        Not filed
     Annual Statement                                  Form 5                        15-Feb-2003        Not filed
</TABLE>
----------------------



                                       25
<PAGE>



ITEM 10. EXECUTIVE COMPENSATION.

     The  following  table sets forth  certain  information  as to the Company's
highest  paid  executive  officers  and  directors  for the fiscal  years  ended
December 31, 2003 and 2002. No other  compensation  was paid to any such officer
or directors other than the compensation set forth below.

<TABLE>
<CAPTION>
                                                                                       Long Term Compensation
                                                                                  ----------------------------------
                                                 Annual Compensation                      Awards          Payouts
                                    --------------------------------------------------------------------------------
             Name                                                        Other
             and                                                         Annual    Restricted                       All Other
          Principal                                                     Compen-      Stock     Options/     LTIP     Compen-
           Position            Year   Salary            Bonus          sation (1)    Awards      SARs     Payouts    sation
-------------------------------------------------------------------------------------------------------------------------------
<S>                             <C>     <C>                         <C>         <C>         <C>         <C>      <C>  <C>
Patrick Gouverneur
Chief Executive Officer         2003         $0                     $0          $0          $0          0        $0         $0
(effective October 15, 2002)    2002    $25,000                     $0          $0          $0          0        $0   $160,000

Cyril Heitzler                  2002    $75,000                     $0          $0          $0          0        $0   $310,000
Secretary/treasurer             2001         $0                     $0          $0          $0          0        $0         $0

Philippe Notton                 2002         $0                     $0          $0          $0          0        $0   $300,000
Director                                                                                                                    $0

Bernard Bouverot                2002    $60,000                     $0          $0          $0          0        $0   $190,000
Secretary/treasurer             2001         $0                     $0          $0          $0          0        $0         $0

Fernand Leloroux                2002    $96,250                     $0          $0          $0          0        $0         $0
Chief Executive Officer         2001         $0                     $0          $0          $0          0        $0         $0
</TABLE>
-----------------------

     In December  2002, we issued 480,000 shares of common stock to our officers
and directors as compensation for services.  All such shares have been valued at
$.25  per  share  for  financial  reporting  purposes  and for  purposes  of the
foregoing table.

STOCK OPTION GRANTS

     We did not grant stock options to any executive  officers during the fiscal
years ended December 31, 2003 or 2002.

EXERCISES OF STOCK OPTIONS AND YEAR-END OPTION VALUES

     No stock  options were  exercised by executive  officers  during the fiscal
years ended December 31, 2003 or 2002.

OUTSTANDING STOCK OPTIONS

     No stock options were outstanding at December 31, 2003 or 2002.

COMPENSATION ARRANGEMENTS

     We pay Mr. Patrick  Gouverneur,  our chief executive  officer,  a salary of
$120,000  per  annum.  We do not have a written  employment  agreement  with Mr.
Gouverneur and we do not pay any additional  compensation to Mr.  Gouverneur for
his services as a member of our board of directors.





                                       26
<PAGE>



ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

     We have  4,870,714  shares of common stock  outstanding on the date of this
Report. There are no outstanding securities, contracts or other instruments that
obligate  our  company  to issue  shares  of  common  stock in the  future.  The
following table presents certain information  regarding the beneficial ownership
of our  common  stock by (i)  each  person  known  to own  more  than 5% of such
securities,  (ii) each of our directors, and (iii) all directors and officers as
a group. Unless otherwise noted, we believe that each of identified stockholders
has sole  investment  and voting  power  with  regard to the  securities  listed
opposite his name.

           Name of           Number of                  Percent
      Beneficial Owner      Shares Owned               of Class
------------------------------------------------------------------------
Olex Financial Ltd. (1)         750,000                  13.6%
Famoya Holdings BV (3)          501,920                  10.5%
Rocasoprane Ltd. (4)            409,861                   8.6%
Patrick Gouverneur (2)           80,000                   1.7%
Cyril Heitzler (5)              281,920                   5.9%

All officers & directors as
 a group (1 person)              80,000                   1.7%
-----------------------------
(1)  Road Town, Tortola BVI.
(2)  222 Lakeview Ave, PMB 435, West Palm Beach, FL 33401
(3)  c/o Multinvest Overseas SA, Nevis, St Kitts & Nevis
(4)  Calle 55 El Cangrejo, Panama City, Republic of Panama
(5)  9 Rue des Alpes, Geneva 1204 Switzerland

     Except as otherwise  noted, it is believed by us that all persons have full
voting and  investment  power with  respect to the shares  indicated.  Under the
rules of the Securities and Exchange Commission,  a person (or group of persons)
is deemed to be a  "beneficial  owner" of a security  if he or she,  directly or
indirectly,  has or shares  the power to vote or to  direct  the  voting of such
security,  or the power to  dispose  of or to  direct  the  disposition  of such
security.  Accordingly,  more than one person  may be deemed to be a  beneficial
owner of the same security.  A person is also deemed to be a beneficial owner of
any security, which that person has the right to acquire within 60 days, such as
options or warrants to purchase our common stock.


ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

     Except as described below,  none of the following persons has any direct or
indirect  material  interest in any transaction to which our company was a party
during the past two years,  or any current or proposed  transaction to which our
company will be a party:

     o    Any director or officer;
     o    Any proposed nominee for election as a director;
     o    Any person who beneficially owns, directly or indirectly,  shares more
          than 5% of our voting equity securities,  or other securities that are
          or  may  be  convertible  into  more  than  5% of  our  voting  equity
          securities; or
     o    Any  relative  or  spouse  of  any of the  foregoing  persons,  or any
          relative of such spouse,  who shares the same  principal  residence as
          person or who is a director or officer of any parent or subsidiary.




                                       27
<PAGE>



Payments to former affiliates

     Prior to the  acquisition  of  Technocall,  we paid $1,000 per month to Mr.
William  Robertson,  our former  president as  consideration  for certain office
space that was used in our business operations.  This arrangement was terminated
upon our acquisition of Technocall.

ATD Note

     Technocall  purchased certain  intellectual  property,  parts and supplies,
machinery and equipment and computer software, together with an electronic smart
card management system for small-throughput  water treatment systems,  from ATD.
In connection with this purchase,  Technocall issued a subordinated note payable
to ATD in the amount of $4,288,500.  The ATD note was  unsecured,  non- interest
bearing,  subordinated  against  future  indebtedness  of Technocall  and had no
specific  terms  for  repayment.  Since  ATD was a  significant  stockholder  of
Technocall on the date of the  transaction,  we valued the  purchased  assets at
$423,937,  their historical cost to ATD. The difference  between the face amount
of the ATD note and the carrying  value of the purchased  assets was recorded in
our financial  statements  for the year ended  December 31, 2001 as a $3,864,563
distribution of equity. ATD subsequently  agreed to forgive $31,070 of principal
in recognition of certain expenses  incurred by Technocall.  The forgiveness was
recorded  as a  reduction  in  the  distribution  of  equity  in  our  financial
statements  for the year ended  December 31, 2001. In April 2002,  ATD agreed to
forgive the balance of the note. Accordingly, neither our company nor Technocall
are liable for the repayment of the ATD note. The  forgiveness  of  indebtedness
was recorded as a reduction to the distribution of equity and additional paid-in
capital in our financial statements for the year ended December 31, 2002. Former
Management

Purchase of supplies from ATD

     In February 2002, we ordered  $1,175,670 in supplies from ATD. In May 2002,
our  company,  ATD and  certain  of  ATD's  creditors  negotiated  a  triangular
agreement  where we issued 487,875 shares of common stock to creditors of ATD in
full payment of the amount due under the February  purchase order.  Three of our
directors were creditors of ATD who  participated  in the foregoing  transaction
and received shares of our common stock in connection  therewith.  The number of
shares   received  by  persons  who  were   officers,   directors  or  principal
stockholders of our company on the date of this report is summarized below:

Fernand Leloroux, a former officer and director         126,920 shares

Cyril Heitzler,an officer and director                  126,920 shares

Famoya Holdings BV, a principal stockholder             126,920 shares

Bernard Bouverot, a former director                      25,000 shares
                                                        -------
                   Total                                405,760 shares
                                                        =======

Resale of shares by ATD in violation of Section 16

     We have been advised that on June 21, 2002, ATD completed a  reorganization
where it exchanged  approximately 140,123 shares of our common stock for certain
shares of  Cartis,  Inc.  that were  owned by others.  In  connection  with this
transaction,  ATD distributed  shares of our common stock to  approximately  180
persons.  Given the complexity of the exchange  transaction  effected by ATD and
the  fact  that  the  transaction  was  closed 6  months  and 4 days  after  our
acquisition of Technocall, we believe there is a significant likelihood that the



                                       28
<PAGE>



transaction  violated  Section 16 of the Exchange  Act and that any  short-swing
profits realized by ATD would be recoverable by our company if we had sufficient
resources to fully investigate transaction and bring a suit for the disgorgement
of those profits.  In light of the recent bankruptcy of Blue Industries SAS, our
very limited  financial  resources and the complexity of obtaining  jurisdiction
over Cartis, a Florida corporation,  ATD, a Gibraltar corporation, and Mr. Herve
Gallion,  a Mauritius  resident who is the principal  stockholder of both Cartis
and ATD, we have no present  ability to institute a Section 16 action and we may
be unable to do so before the 2-year statute of limitations specified in Section
16 expires.

Stockholder's loan

     On June 25,  2002,  Famoya  Holdings BV agreed to loan our company  through
Blue  Industries,  SAS, our former  French  subsidiary,  up to $600,000  under a
five-month  loan  facility.  On the  transaction  date,  Famoya  holdings  owned
approximately  9.1% of our common stock.  The interest  associated with the loan
facility was calculated at the rate of 2% per month on the outstanding principal
balance.  Three-quarters  of the interest was payable in cash and one-quarter of
the  interest was payable in shares of our common stock at an agreed price of $2
per share.  Principal  and interest on the loan facility were payable in full on
November 30, 2002 and the Famoya loan is presently in default.  While Famoya has
the right to convert the unpaid  loan  balance  and all  accrued  interest  into
shares of our common stock at a price of $2 per share,  the conversion  price is
significantly greater than the market price of our shares.  Accordingly,  Famoya
is not expected to exercise its conversion rights.

Stock sales to related parties

     In August 2002, we sold 125,000  shares of our  restricted  common stock to
Dr.  Mohammed Al Yamani,  the principal  stockholder of Famoya  Holdings BV, for
$230,000  in  cash,  a price  that  represented  a  substantial  premium  to the
prevailing market price of our unrestricted shares on the transaction date. As a
result of this  transaction,  Dr. Yamani became a principal  stockholder  of our
company.

     In September 2002, we sold 83,334 shares of our restricted  common stock to
Rocasoprane  Ltd for $50,000 in cash,  a price that  represented  a 40% discount
from the prevailing  market price of our unrestricted  shares on the transaction
date.  Rocasoprane  Ltd. was a former  principal  stockholder  of Technocall and
became a principal stockholder of our company as a result of this transaction.

Compensatory stock issuances

     In December 2002,  our board of directors  issued  2,095,000  shares of our
restricted common stock to 19 individuals in compensatory transactions that were
valued  at $.25 per share  for  financial  reporting  purposes.  Of this  total,
980,000  shares were  issued to  individuals  who were  officers,  directors  or
principal  stockholders of our company on the date of this report. The following
table summarizes the stock issuances to those affiliates:


Dr. Mohammed Al Yamani, a principal stockholder                 250,000 shares

Christophe Giovannetti, a principal stockholder                 250,000 shares

Cyril Heitzler, a former officer and director                   155,000 shares

Philippe Notton, a former director                              150,000 shares

Bernard Bouverot, a former director                              95,000 shares

Patrick Gouverneur, an officer and director                      80,000 shares
                                                                -------
                   Total                                         980,000 shares
                                                                =======


                                       29
<PAGE>



ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K.

     (a) The exhibits  required to be filed  herewith by Item 601 of  Regulation
S-B, as described in the following index of exhibits, are incorporated herein by
reference, as follows:

Exhibit No.    Description
----------  -------------------------------------

31.1 *      Section 302 Certification by Chief Executive Officer.

31.2 *      Section 302 Certification by Chief Financial Officer.

32.1 *      Section 906 Certification  by  Chief  Executive  Officer  and  Chief
            Financial Officer.
-------------------

*    Filed herewith

        (b) Reports on Form 8-K

     None


ITEM 14 - PRINCIPAL ACCOUNTANT FEES AND SERVICES

     The  Company  paid or accrued the  following  fees in each of the prior two
fiscal years to its principal accountant, Durland & Company, CPAs, P.A., of Palm
Beach, Florida.

                                           Year ended        Year ended
                                          December 31,      December 31,
                                             2003               2002
                                          -------------------------------

(1)      Audit fees                       $  30,000         $  10,000
(2)      Audit-related fees                   8,500                 -
(3)      Tax fees                                 -                 -
(4)      All other fees                           -                 -
                                          ---------         ---------

   Totals                                 $  38,500         $  10,000
                                          =========         =========

     We have  considered  whether the  provision of such  non-audit  services is
compatible with Durland & Company,  CPAs, P.A., maintaining its independence and
determined that these services do not compromise their independence.

     Financial Information System Design and Implementation.  Durland & Company,
CPAs, P.A., did not charge the Company any fees for financial information system
design and implementation fees.

     The Company has no formal  audit  committee.  However,  the entire Board of
Directors (the "Board") is the Company's defacto audit committee. In discharging
its oversight  responsibility  as to the audit process,  the Board obtained from
the independent auditors a formal written statement describing all relationships
between  the  auditors  and  the  Company  that  might  bear  on  the  auditors'
independence  as  required  by  Independence  Standards  Board  Standard  No. 1,


                                                                              30
<PAGE>



"Independence  Discussions with Audit  Committees." The Board discussed with the
auditors any  relationships  that may impact their objectivity and independence,
including fees for non-audit services,  and satisfied itself as to the auditors'
independence.  The Board also discussed with management,  the internal  auditors
and the independent  auditors the quality and adequacy of the Company's internal
controls.  The Board reviewed with the  independent  auditors  their  management
letter on internal controls.

     The Board discussed and reviewed with the independent  auditors all matters
required to be discussed by auditing standards  generally accepted in the United
States of America,  including those described in Statement on Auditing Standards
No. 61, as amended,  "Communication  with Audit Committees".  The Board reviewed
the audited  consolidated  financial statements of the Company as of and for the
year ended  December 31, 2003,  with  management and the  independent  auditors.
Management has the responsibility for the preparation of the Company's financial
statements  and  the  independent  auditors  have  the  responsibility  for  the
examination  of  those  statements.  Based  on the  above-mentioned  review  and
discussions with the independent auditors and management, the Board of Directors
approved the Company's audited consolidated financial statements and recommended
that they be  included  in its Annual  Report on Form  10-KSB for the year ended
December 31, 2003, for filing with the Securities and Exchange  Commission.  The
Board also  approved the  reappointment  of Durland & Company,  CPAs,  P.A.,  as
independent auditors.

     The Company's principal accountant,  Durland & Company, CPAs, P.A., did not
engage  any  other  persons  or  firms  other  than the  principal  accountant's
full-time, permanent employees.




                                   SIGNATURES

     Pursuant to the  requirements of Section 13 or 15(d) of the Exchange Act of
1934,  the  registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.



Date November    , 2004                BLUE INDUSTRIES, INC.




By:  /s/ Patrick Gouverneur
-------------------------------------
Patrick Gouverneur
Chief Executive Officer and Director
And Chief Accounting Officer



                                                                              31
<PAGE>


                               CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

I Patrick Gouverneur,  Chief Executive Officer of Blue Industries,  Inc. certify
that:

1. I have reviewed this annual report on Form 10-KSB of Blue Industries, Inc.;

2.  Based on my  knowledge,  this  annual  report  does not  contain  any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made,  not  misleading  with  respect to the period  covered by this annual
report;

3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included  in this annual  report,  fairly  present in all  material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this annual report;

4.  The  registrant's  other  certifying  officers  and I, are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

     a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others  within those  entities,  particularly  during the
period in which this annual report is being prepared;
     b) evaluated the effectiveness of the registrant's  disclosure controls and
procedures  as of a date  within 90 days prior to the filing date of this annual
report (the "Evaluation Date"); and
     c) presented in this annual report our conclusions  about the effectiveness
of the  disclosure  controls and  procedures  based on our  evaluation as of the
Evaluation Date;

5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation,  to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent function):

     a) all  significant  deficiencies  in the design or  operation  of internal
controls  which  could  adversely  affect  the  registrant's  ability to record,
process,  summarize  and  report  financial  data  and have  identified  for the
registrant's auditors any material weaknesses in internal controls; and
     b) any fraud,  whether or not material,  that involves  management or other
employees who have a significant role in the registrant's internal controls; and

6. The  registrant's  other  certifying  officers  and I have  indicated in this
annual report whether or not there were significant changes in internal controls
or in other factors that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.


/s/ Patrick Gouverneur
---------------------------
Patrick Gouverneur
Chief Executive Officer