SECURITIES AND EXCHANGE COMMISSION
                               Washington, D.C. 20549

                                      FORM 10-K

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

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

                         For the fiscal year ended: March 31, 2004

                              Commission File Number: 0-16734

                                    C.E.C. INDUSTRIES CORP.

                    (Exact name of registrant as specified in its charter)


                  Nevada                                      87-0217252
          (State  or  other jurisdiction of                (I.R.S. Employer
            incorporation or organization)                Identification No.)

                2999 N.E. 191st Street, PH2
                Aventura, FL                                 33180


         (Address of principal executive offices)          (Zip Code)


       Registrant's telephone number including area code: (866) 820-5139

             Securities registered pursuant to Section 12(b) of the Act:
                           Common Stock, $0.001 par value

               Securities registered pursuant to Section 12(g) of the Act:
                            Common Stock, $0.001 par value

Indicate by check mark whether the registrant (a) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 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

Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not 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-K or any
amendment to this Form 10-K. [ ]

The aggregate market value (the average bid and asked prices) of the voting
stock held by non-affiliates of the registrant on August 9, 2004 was
approximately $717,496.

The number of shares of Common Stock, $0.001 par value, outstanding on
August 9, 2004 was 56,724,707 shares.

<PAGE>

                                     PART I

ITEM  1. BUSINESS

(a) General

C.E.C. Industries Corp. is a Nevada corporation with principal and executive
offices located at 2999 N.E. 191st Street, Penthouse 2, Aventura, FL 33180,
telephone (866) 820-5139. C.E.C. Industries Corp. and it's consolidated
subsidiaries are referred to as either C.E.C. or the Company. C.E.C. is
currently engaged in seeking an acquisition or merger candidate.  C.E.C.
was incorporated as Justheim Petroleum Company in Nevada in 1952.  C.E.C.
Management Corp. was merged into Justheim Petroleum Company effective
December 31, 1986, and was renamed C.E.C. Industries Corp. Prior to the
merger, Justheim had historically engaged in the business of acquiring,
holding and selling oil and gas leaseholds and retaining overriding royalty
rights. C.E.C. Management Corp. primarily was in the business of engineering
consulting and designing and marketing customized minerals processing systems
and equipment. The Company is currently not engaged in a primary business and
is seeking an acquisition or merger candidate.


Executive Offices

C.E.C.'s executive offices are located at 2999 N.E. 191st Street, Penthouse 2,
Aventura, Florida 33180.

EMPLOYEES

Currently, the Companies sole employees are the members of its Board of
Directors.  The Company intends to hire additional employees as needed in
the future.

ITEM  2. PROPERTIES

C.E.C. does not currently lease or rent office space.

ITEM  3. LEGAL PROCEEDINGS

On September 2, 1998, a judgement was entered in United States District
Court, District of Utah, Central Division, against C.E.C. Industries, Inc.
in favor of George A. Matthews, Jr. a former President and Director of
C.E.C. Industries.  The judgement entered was in the amount of $207,306.93.
The judgement award was to compensate Mr. Matthews for monies allegedly owed
to him on his Employment Agreement, from an alleged wrongful stop transfer,
interest, and attorney's fees.  The company has been unable to post a bond.
The judgement has been recorded in several states under the Sister State
Judgement Act.

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

No matter was submitted to a vote of security holders, through the
solicitation of proxies or otherwise, during the fourth quarter of the
Company's fiscal year ended March 31, 2004

<PAGE>

                                      PART II

ITEM  5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
        MATTERS

The Company's Common Stock is quoted on the Pink Sheets under the symbol CECC.
The following table sets forth the quarterly high and low bid prices for the
Company's Common Stock during the last two fiscal years of the Company, as
reported by the National Quotations Bureau. The quotations reflect inter-
dealer prices, without retail mark-up, mark-down or commission, and may not
necessarily represent actual transactions.

                   2004              2003                 2002
              High      Low       High      Low       High      Low
1st Quarter    .52      .05        .12      .006      $.075    $.025
2nd Quarter    .40      .18        .06      .002       .01      .003
3rd Quarter    .25      .12        .045     .002       .025     .01
4th Quarter    .17      .013       .17      .04        .03      .01
Yearly        0.520    0.013     0.17     0.002      0.075     0.003

No dividend was declared or paid by the Company during fiscal year 2004, 2003
or 2002. A decision to pay dividends in the future will depend upon the
Company's profitability, need for liquidity and other financial
considerations. There are over 1,500 shareholders of the 58,724,707
outstanding shares, as of August 9, 2004.


ITEM  6.   SELECTED FINANCIAL DATA

                     2004         2003      2002          2001           2000

Revenue from
continuing
operations             0            0      $1,721        $10,305       $5,253

Revenue from
discontinued
operations             0            0           0              0            0

Net income (loss)
from
continuing
operations    (1,317,947)   ($241,471)    $(5,536)     $(167,953)   $(147,178)

Net gain/ loss
From Discontinued
operations             0            0           0              0            0

Gain/loss per
common share:
Continuing
operations                       (.03)       (.00)       (.01)           (.01)
Discontinued
operations          0.00         0.00        0.00        0.00            0.00

Total Assets    $384,922     $116,910    $116,891       $117,727     $121,953

Long term
obligations            0            0           0              0            0

Cash dividends per
     common share      0            0           0              0            0

<PAGE>

ITEM  7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
        RESULTS OF OPERATIONS

The following discussion should be read in conjunction with the financial
statements and the notes thereto.

Overview

The company has continued to go through major transitions pertaining to
direction and continued operations. During fiscal 2004, the Company earned
no revenues.

On November 30, 2003, CEC entered into an Acquisition and Financing Agreement
with PayCard Solutions, Inc., pursuant to which CEC's subsidiary, Paycard
Unlimited, Inc. purchased all of the outstanding shares of PayCard in
consideration  for the  issuance of  3,000,000  CEC shares to the PayCard
shareholders and 200 shares or twenty (20%) percent of the Subsidiary's
outstanding  shares,  whichever  is  greater.  Pursuant to the Agreement, CEC
agreed to lend a total of $250,000 to PayCard for a term of one year with
eight (8%) interest which shall be secured by Paycard.  A total of $250,000
was loaned to PayCard pursuant to this agreement through loan secured by CEC
and of such amount a total of $53,150 was provided by an independent entity.
The Company has subsequently discovered that a shareholder of such entity was
indicted for bank fraud and related charges in federal court in California.
The individual has provided information confirming that loan proceeds from
the entity have no connection to the pending criminal case against the
individual.   The Company is in the process of attempting to obtain
independent verification to confirm the source of funds loaned by the
individual through the entity.  Once the Company completes its due diligence
and obtains additional relevant information from the individual and the
entity, it will take all necessary and appropriate steps to protect the
interests of the Company with respect to these funds.

As a precautionary measure, the Company has determined that it is appropriate
to take immediate steps to sever its relationship with both the individual and
the entity as well as any other companies affiliated with the individual, and
return, to the extent practicable, the parties to the original positions they
were in before the transactions were effected. To effect this separation, both
the individual and the entity have agreed to assign the portion of the note
($53,150) paid by the entity to the entity.  The entity, the individual and
any other companies affiliated with the individual have also agreed to return
all of the CEC shares owed by them to the Company and have agreed to release
the Company from any obligations owed to the entity, the individual and his
affiliated entities.  To date this agreement has been entered into but these
shares have not been canceled of record.

Due to this situation, Paycard refused to provide its financial statements
to the Company so that the Company could complete its audited financial
statements for its March 31, 2004 10KSB.  Therefore, the Company assigned
eighty-five (85%) percent of its ownership interest in Paycard to
Knightsbridge Holding, LLC, which has been providing and will continue to
provide funding to the Company.  Upon completion of such assignment, the
Company will only own fifteen (15%) percent of PayCard and will no longer be
required to provide an audit for PayCard

The Company also entered into an Asset Purchase Agreement with CEC Asset
Reclamation Corp. to sell the balance of its remaining assets for a total
purchase price of 80 % of net proceeds in the liquidation of these assets.

Liquidity and Capital Resources

Cash requirements of C.E.C. have been met by funds provided from (a)
borrowing. The ratio of current assets to current liabilities at March 31,
2004 was .01 to 1 compared to .06 to 1 at March 31, 2003. The working capital
of the Company as of March 31, 2004, was ($1,202,449). The working capital at
March 31, 2003 was ($981,147). Cash was $13,507 at fiscal 2004 year end versus
$495 at fiscal 2003 year end versus $476 at fiscal 2002 year end.

<PAGE>

Analysis of Operating, Investing and Financing Activities During 2004.

During 2004, the Company increased its accounts payable by $789,950
compared. to 2003 $774,336 where it increased its accounts payable by
$15,614.  During 2004, the Company moved its recorded $207,306 judgment
awarded George Matthews Jr. from long term debt to current liabilities.  It
recorded additional long term debt from notes payable of $218,700.  There
were no accounts receivable as March 31, 2004, March 31, 2003 or for
March 31, 2002.


Borrowing Activities

During the past three years, the Company's operations and investing
activities have been financed extensively from borrowings. Borrowings have
been approximately $218,700, $2,190, $23,727 and $145,521 in fiscal years
2004, 2003, 2002 and 2000, respectively.


Results of Operations

Fiscal Year 2004 Compared to Fiscal Year 2003

Revenues. The Company's revenues remained at $0 for 2004 from $-0- in 2003.

Selling, General and Administrative Expenses. The Company's selling, general
and administrative expenses increased from $4,671 in 2003 to $23,542 in 2004,
an increase of $18,871. Selling, General and Administrative Expenses (S,G&A)
net increases were primarily attributable to activity of the company
Consulting expenses were $27,300 in 2003 and $1,049,405 in 2004.  The increase
in consulting expenses is the result of management activity to establish a
viable business operation.  Executive Compensation was $-0- in 2002 and
$210,000 in 2003 and $0 in 2004.  Legal expenses were $-0- in 2004 and 2003.

Interest Expense. Interest expense for the Company was from $0 in 2002 to $0
in 2003 and remained at $0 in 2004

Other Income and Expense. Other income and expense for the Company
was from $0 in 2002 and $0 in 2003 and increased in 2004 to $245,000 including
write-offs of notes receivable.

Gain or Loss on Sale of Assets. There was no gain or loss on sale of assets
for the Company in 2002, 2003 or 2004.

Gain or Loss from Discontinued Operations. There was no gain or loss from
discontinued operations during 2002, 2003 or 2004.

Gain or Loss on Disposal of Discontinued Operations. There was no Gain or
loss from disposal of discontinued operations during 2002, 2003 or 2004.


ITEM  8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

See Financial Statements and Financial Statement Schedules appearing on F-1 to
F-25 of this Form 10-K Annual Report.

In addition as mentioned in Item 7. there were a number of events that occurred
subsequent to the balance sheet date.  Accordingly, management has prepared
these unaudited pro forma statements to illustrate the effects on the
March 31, 2004 financial statements had these events been known or transpired
prior to March 31, 2004.

<PAGE>

ITEM  8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA (CONTINUED)

                      C.E.C. INDUSTRIES, CORP. AND SUBSIDIARIES
                             (A DEVELOPMENT STAGE COMPANY)
                               PRO FORMA BALANCE SHEET
                                        AS AT
                                   MARCH 31, 2004
<CAPTION>
<TABLE>
                                                 March 31, 2004
     ASSETS
<S>                                              <C>
CURRENT
Cash                                               $ 13,507.00
                                                --------------

Total Current Assets                                 13,507.00
                                                --------------

LIABILITIES & EQUITY

LIABILITIES
     CURRENT LIABILITIES
Accounts Payable                                 $   34,926.00
Judgement Payable                                   207,306.00
Convertible notes payable                           218,700.00
                                                --------------

Total Current Liabilities                        $  460,932.00
                                                --------------

EQUITY

Common Stock                                      2,091,305.00
Additional Paid in Capital                        7,654,620.00
Retained Earnings                               (10,193,350.00)
                                                --------------

Total Equity                                       (447,425.00)
                                                --------------

TOTAL LIABILITIES EQUITY                         $   13,507.00
                                                --------------
                                                --------------
</TABLE>
                                   Unaudited
<PAGE>

ITEM  8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA (CONTINUED)

                       C.E.C. INDUSTRIES, CORP. AND SUBSIDIARIES
                                (A DEVELOPMENT STAGE COMPANY)
                           PRO FORMA STATEMENT OF OPERATIONS
                                      FOR YEAR ENDING
                                       March 31, 2004
<TABLE>
<CAPTION>
                                                 March 31, 2004
<S>                                              <C>
ROYALTY REVENUE                                          0.00
                                                -------------

OPERATING EXPENSES

Consulting fees                                  1,049,405.00
Management fees                                          0.00
General and Administrative                          23,542.00
                                                --------------
Total Operating Expenses                         1,072,947.00
                                                --------------
OPERATING LOSS                                  (1,072,947.00)
                                                --------------
OTHER ITEMS
Write off of notes receivable                     (200,000.00)
Writedown of technology rights                    (300,000.00)
                                                --------------
                                                  (505,000.00)
                                                --------------

NET LOSS                                        (1,572,947.00)
                                                --------------
                                                --------------

Weighted average number of shares outstanding -
basic and fully diluted                            44,444,885

Net Loss per share - basic and fully diluted      $     (0.03)

</TABLE>

                                   Unaudited


ITEM  9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

NONE.

                                   PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

The Directors and Officers of the Company as of August 9, 2004 are as follows:

Name and Address                                Position Held

Jeffrey Sternberg                           Chairman of the Board,
2999 N.E. 191st Street, PH2                 Chief Executive Officer,
Aventura, FL 33180                          President, Principal Financial
                                            Officer, Principal Accounting
                                            Officer, Secretary/Treasurer

Craig Press                                 Director
150-38 12th Avenue
Staten Island, NY 10301

<PAGE>

JEFFREY I. STERNBERG was appointed as our Executive Vice President and as a
member of our Board of Directors in March 2004 and was appointed as our
President, Chief Executive Officer, Chief Financial Officer and as a member
of our Board of Directors on July 16, 2004. Since June 2002, Mr. Sternberg
has been the managing member of Phoenix Capital Partners, LLC a financial
investment company located in Hollywood, Florida. Prior to his acquiring
Phoenix Capital Partners, LLC, he worked for Atico International based in
South Florida. Atico is a specialty importer of goods. Mr. Sternberg spent
over two decades working with mass merchandisers, drug chains and specialty
stores and consulting with regional and national buyers to distribute goods
throughout the United States and Asia. Additionally, Mr. Sternberg served
these and other customers by managing their imports and exports of products,
arranging for the financing and the manufacturing of a wide variety of retail
merchandise. Mr. Sternberg attended the University of Miami.

CRAIG PRESS was appointed to our Board of Directors on July 16, 2004. From
1996 to the present, Mr. Press has been the Vice President and head of
operations for Georal International, Corp. and AJR International, Ltd., both
located in Whitestone, New York. His responsibilities include the oversight
and management of day to day operations of the company's employees, its
sales, marketing, public relations and construction, of all of the company's
products and services. Additionally, he is responsible for the day to day
operations of the company's California facility and its personnel as well.
Mr. Press also maintains control of the company's contacts with federal, state
and municipal organizations as well as major real estate, banking and
industrial corporations. Mr. Press is also a security consultant for anti-
terrorism perimeter security, employee entrance and egress, fire, building
and safety codes and negotiates all labor contracts with the New York City
unions with which his company interacts.


ITEM 11. EXECUTIVE COMPENSATION

The Compensation which the Company paid to the President for services in all
capacities and for the fiscal years indicated, was as follows:

Name and Principal Position             Year    Salary              Other

Jeffrey Sternberg                       2004    $      0
Craig Press                             2004    $      0
Brian Dvorak                            2004    $      0
Brian Dvorak                            2003    $210,000
Brian Dvorak                            2002    $      0
Brian Dvorak                            2001    $      0
Brian Dvorak                            2000    $      0

Brian Dvorak resigned as President, CEO, CFO and as a member of the Board of
Directors of the Company in July 2004. Brian Dvorak received no compensation
for his services in 2000, 2001 or 2002. In fiscal year ending March 31, 2003,
he received 30,000,000 shares of the company's common stock valued at $210,000
for services rendered. No compensation was recorded in 2004.

STOCK AWARD PLAN

On November 29, 2002, the company established a Stock Award Plan to promote
the interests of the Company and its Subsidiaries and shareholders by using
investment interests in the Company to attract, retain and motivate its key
officers, employees, directors, advisors and consultants to encourage and
reward their contributions to the long range performance goals of the Company
and to link their compensation interests with the long term interests of the
Company and its shareholders.  The Company had issued  3,900,000 shares of its
common stock under the plan as at March 31, 2004.  No additional shares were
recorded in 2004.

<PAGE>

EMPLOYEE BENEFIT PLAN

None.


ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

BENEFICIAL STOCK OWNERSHIP

The following table sets forth, as of August 9, 2004, Common Stock ownership
of (1) the directors of the Company, (2) the only persons known to management
to be the beneficial owners of more than five percent of the Common Stock of
the Company, and (3) the Company's directors and officers as a group:

                                        Amount and               Options
                                         Nature of               or Other
Title of      Name and Address           Beneficial   Percent    Beneficial
  Class     of Beneficial Owner(1)     Ownership of    Class     Owners(2)(3)

Common       Jeffrey Sternberg                   0        0%
Common       Craig Press                         0        0%
Common       Brian Dvorak(4)             7,475,000       12.73%


(1) Addresses are furnished only for those beneficial owners of 5% or more of
the Company's Common Stock.
(2) All beneficial owners have sole voting and investment power over all of
the shares they own, except as indicated in column five and these footnotes.
(3) The amounts in column three include the amounts in column five.
(4) Mr. Dvorak has entered into a resignation agreement and release agreement
with the Company pursuant to which he has resigned as President, CEO, CFO,
Secretary and Board of Directors of the Company.  In addition, pursuant to
such agreement, Mr. Dvorak agreed to return 2,475,000 shares of the 7,475,000
shares that he currently holds in the Company.  To date the agreement has
been entered into but the shares have not been canceled of record.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

None

ITEM 14. PRINCIPAL ACCOUNTANTING FEES AND SERVICES

Audit Fees

For the Company's fiscal year ended March 31, 2004, we were billed
approximately $4,500.00 for professional services rendered for the audit of
our financial statements. We also were billed approximately $3,000.00 for the
review of financial statements included in our periodic and other reports
filed with the Securities and Exchange Commission for our year ended
March 31, 2004.

Tax Fees

For the Company's fiscal year ended March 31, 2004, we were billed $-0- for
professional services rendered for tax compliance, tax advice, and tax
planning.

All Other Fees

The Company did not incur any other fees related to services rendered by our
principal accountant for the fiscal year ended March 31, 2004.

ITEM 15.  EXHIBITS AND REPORTS ON FORM 8K

     (a)  Exhibits:

          None

     (b)  Reports of Form 8-K filed in fourth quarter of the fiscal year:

          None


SIGNATURES

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

C.E.C. INDUSTRIES CORP.


By:  /s/ Jeffrey Sternberg                  Dated: August 9, 2004
     ---------------------
         Jeffrey Sternberg,
         Chief Executive Officer

<PAGE>

                          FINANCIAL STATEMENTS
                              March 31, 2003
                                    and
                              March 31, 2002

                             TABLE OF CONTENTS

                                                                    PAGE

     Independent Auditors' Report

     Consolidated Balance Sheet as at March 31, 2003
        and March 31, 2004                                         F-2

     Consolidated Statement of Operations for the Years
        ended March 31, 2003 and March 31, 2004                    F-3

     Consolidated Statement of Changes in Stockholders'
        Equity for years ended March 31, 2003 and March 31, 2004   F-4

     Consolidated Statement of Cash Flows for the years ended
        March 31, 2003 and March 31, 2004                          F-5

    Notes to Financial Statements                                  F-6 TO F-11

<PAGE>


                             Russell & Atkins, PLC
                          Certified Public Accountants


To the Stockholders and Board of Directors
C.E.C. Industries Corp.


We have audited the accompanying balance sheet of C.E.C. Industries Corp. (a
development stage company) as of  March 31, 2004, and the related
consolidated statements of operations, stockholders' equity (deficit) and
cash flows for the year ended March 31, 2004. These financial statements are
the responsibility of the Company's management.  Our responsibility is to
express an opinion on these financial statements based on our audit. We did
not examine the financial statements of the Company prior to April 1, 2002,
and these statements were audited by the other auditors whose report dated
April 5, 2002, has been furnished to us and contained a paragraph describing
their concerns regarding the ability of the Company to continue as a going
concern.

We conducted our audit in accordance with auditing standards generally
accepted in the United States of America..  Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement.  An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the 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
audit provides a reasonable basis for our opinion.

In our opinion, based on our audit and the report of other auditors, the
consolidated financial statements referred to above present fairly, in all
material respects, the financial position of C.E.C. Industries Corp. as of
March 31, 2004, and the results of its operations and its cash flows for the
year then ended in conformity with accounting principles generally accepted
in the United States of America.

The Company's consolidated financial statements are prepared using the
generally accepted accounting principles applicable to a going concern, which
contemplates the realization of assets and liquidation of liabilities in the
normal course of business.  The Company has incurred accumulated losses since
inception of $10,619,659.  These factors as discussed in Note 8 to the
consolidated financial statements, raise substantial doubt about the
Company's ability to continue as a going concern.  The consolidated financial
statements do not include any adjustments that might result from the outcome
of this uncertainty.

Russell & Atkins, PLC
------------------------------
/s/ Russell & Atkins

Edmond, Oklahoma
July 12, 2004


                          P O Box 1035, Edmond, Oklahoma  73083
                 Telephone: 405 209-5485 Fax: 405 843-9975


<PAGE>


                      C.E.C. INDUSTRIES, CORP. AND SUBSIDIARIES
                             (A DEVELOPMENT STAGE COMPANY)
                               CONSOLIDATED BALANCE SHEET
                                        AS AT
                            MARCH 31, 2004 and MARCH 31, 2003
<CAPTION>
<TABLE>
                                                 March 31, 2004 March 31, 2003
     ASSETS
<S>                                              <C>            <C>
CURRENT
Cash                                               $ 13,507.00     $    495.00
Prepaid expenses                                             -               -
                                                --------------   -------------

Total Current Assets                                 13,507.00          495.00
                                                --------------   -------------


OTHER
Oil & Gas Interests                                 116,415.00      116,415.00
Technological rights                                225,000.00               -
                                                --------------   -------------


Total Other Assets                                 $371,415.00     $116,415.00
                                                --------------   -------------


TOTAL ASSETS                                       $384,922.00     $116,910.00
                                                --------------   -------------
                                                --------------   -------------


LIABILITIES & STOCKHOLDERS' EQUITY

LIABILITIES
Accounts Payable                                 $  789,950.00     $774,336.00
Judgement Payable                                   207,306.00      207,306.00
Convertible notes payable                           218,700.00               -
                                                --------------   -------------

Total Current Liabilities                        $1,215,956.00     $981,642.00
                                                --------------   -------------


STOCKHOLDERS' EQUITY

Preferred stock, par value $.001, convertible
authorized - 100,000,000
issued and outstanding - none
Common stock, par value $.001, authorized -
50,000,000
issued and outstanding 58,724,707
(2003 - 34,309,707                                2,097,405.00    2,072,990.00

Additional Paid in Capital                        7,691,220.00    6,336,230.00

Deficit accumulated during
development stage                               (10,619,659.00)  (9,303,952.00)
                                                --------------   -------------


Total Stockholders' Equity                         (831,034.00)    (864,732.00)
                                                --------------   -------------

TOTAL LIABILITIES & STOCKHOLDERS' EQUITY           $384,922.00     $116,910.00
                                                --------------   -------------
                                                --------------   -------------
</TABLE>
                       See accompanying notes to financial statements
                                            F-2
<PAGE>

                       C.E.C. INDUSTRIES, CORP. AND SUBSIDIARIES
                                (A DEVELOPMENT STAGE COMPANY)
                           CONSOLIDATED STATEMENT OF OPERATIONS
                                      FOR YEARS ENDING
                            March 31, 2004 and March 31, 2003
<TABLE>
<CAPTION>
                                                 March 31, 2004 March 31, 2003

<S>                                              <C>            <C>
ROYALTY REVENUE                                          0.00             0.00
                                                --------------   -------------

OPERATING EXPENSES

Consulting fees                                  1,049,405.00        27,300.00
Management fees                                          0.00       210,000.00
General and Administrative                          23,542.00         4,671.00
                                                --------------   -------------
Total Operating Expenses                         1,072,947.00       241,971.00
                                                --------------   -------------
OPERATING LOSS                                  (1,072,947.00)     (241,971.00)
                                                --------------   -------------
OTHER ITEMS
Write off of notes receivable                     (200,000.00)            0.00
Writedown of technology rights                     (45,000.00)            0.00
                                                --------------   -------------
                                                  (245,000.00)
                                                --------------   -------------

NET LOSS                                        (1,317,947.00)     (241,971.00)
                                                --------------   -------------
                                                --------------   -------------

Weighted average number of shares outstanding -
basic and fully diluted                            44,444,885        7,552,447

Net Loss per share - basic and fully diluted      $     (0.03)      $    (0.01)

</TABLE>
                       See accompanying notes to financial statements
                                            F-3
<PAGE>

                  C.E.C. INDUSTRIES, CORP. AND SUBSIDIARIES
                       (A DEVELOPMENT STAGE COMPANY)
         CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
                     FROM APRIL 1, 1999 TO MARCH 31, 2004
<TABLE>
<CAPTION>
                                                                       Deficit
                                                                     Accumulated
                                                        Additional      during
                             Common  Stock               Paid-In     Development
                                Shares        Amount     Capital        Stage       Totals
-------------------------------------------------------------------------------------------
<S>                             <C>          <C>        <C>          <C>          <C>
Balance - April 1, 1999         187,320   $  934,090   $7,124,830  $(8,741,314) $(682,394)

April 1999 - Stock issued for
legal services                    1,002        5,000       (2,000)                  3,000

Net loss - March 31, 2000                                             (147,178)  (147,178)
-------------------------------------------------------------------------------------------
Balance March 31, 2000          188,322      939,090    7,122,830   (8,888,492)  (826,572)

September 2000
stock issued for services        20,000      100,000      (60,000)                 40,000

October 2000
stock issued for services       200,000    1,000,000     (900,000)                100,000

Net loss - March 31, 2001                                             (167,953)  (167,953)
-------------------------------------------------------------------------------------------
Balance - March 31, 2001        408,322    2,039,090    6,162,830   (9,056,445)  (854,525)

Net loss - March 31, 2002                                               (5,536)    (5,536)
-------------------------------------------------------------------------------------------
Balance - March 31, 2002        408,322    2,039,090    6,162,830   (9,061,981)  (860,061)

Rounding due to reverse split     1,385

Issuance of S-8 stock
for services                  3,900,000        3,900       23,400                  27,300

January 2003 - issuance of
stock for management fees    30,000,000       30,000      180,000                 210,000

Net loss - March 31, 2003                                             (241,971)  (241,971)
-------------------------------------------------------------------------------------------
Balance - March 31, 2003     34,309,707    2,072,990    6,366,230   (9,303,952)  (864,732)

Issuance of S-8 stock
for services during period   16,815,000       16,815      917,590                 934,405

Issuance of 144 stock
for services                  4,600,000        4,600      110,400                 115,000

Issuance of 144 stock for
technology rights             3,000,000        3,000      297,000                 300,000

Net loss - March 31, 2004                                           (1,317,947)(1,317,947)
-------------------------------------------------------------------------------------------
Balance - March 31, 2004     58,724,707    2,097,405    7,691,220  (10,621,899)  (833,276)
</TABLE>
                       See accompanying notes to financial statements
                                            F-4

<PAGE>

                       C.E.C. INDUSTRIES, CORP. AND SUBSIDIARIES
                               (A DEVELOPMENT STAGE COMPANY)
                           CONSOLIDATED STATEMENT OF CASH FLOWS
                                    FOR THE YEARS ENDED
                             March 31, 2004 and March 31, 2003

<TABLE>
<CAPTION>
                                                 March 31, 2004 March 31, 2003
<S>                                              <C>            <C>
Cash Flows From Operating Activities:
Net Loss for the period                          $(1,317,947.00)  $(241,971.00)
Adjustments to Reconcile Net Loss to Net
Cash used in operating activities:
Stock issued for services                          1,049,405.00     237,300.00
Writedown of technology rights                        45,000.00
Acquisition of technology rights for stock           300,000.00

Change in assets and liabilities:
Increase in prepaid expenses
Increase in accounts payable                          17,854.00       4,690.00
                                                    -----------    -----------
Net Cash Used in Operating Activities                 94,312.00          19.00
                                                    -----------    -----------

Cash Flows From Investing Activities
Acquisition of technology rights                    (300,000.00)
                                                    -----------    -----------

Net Cash Used In Investing Activities               (300,000.00)
                                                    -----------    -----------

Cash Flows From Financing Activities
Notes Payable                                        218,700.00
                                                    -----------    -----------

Net Cash Provided by Financing Activities            218,700.00

Change in Cash                                        13,012.00          19.00

Cash and Cash Equivalents - Beginning of year            495.00         476.00
                                                  -------------    -----------

Cash and Cash Equivalents - End of year             $ 13,507.00   $     495.00
                                                  -------------    -----------

Supplementary Information
Interest Paid                                    $     195.00     $     180.00
Taxes Paid                                       $       0.00     $       0.00

</TABLE>
                       See accompanying notes to financial statements
                                            F-5

<PAGE>

                 C.E.C. Industries, Corp. and Subsidiaries
                       (A Development Stage Company)
                       NOTES TO FINANCIAL STATEMENTS

 1.  General

     Business and Principles of Consolidation

The consolidated financial statements include the accounts of C.E.C.
Industries Corp. (the  Parent) and its subsidiaries, Custom Environmental
International, Inc. ("CEI") (80% owned the reduction in ownership of CEI from
90% was due to the issuance of additional shares of common stock to employees
in lieu of salaries), Plata Oro (57% owned), Moonridge Development Corp.
(100% owned), Sterling Travel (100% owned), Microsphere Technology (100%
owned), Islet Transplant Technology (100% owned), Mid-Nevada Art, Inc. (100%
owned) and Basia Holding, Inc. (100% owned.). During the fiscal year 1996,
the Sterling Travel (100%) purchase was canceled due nonperformance by
Sterling Travel. During the fiscal year 1996, Microshpere Technology (100%)
and Islet Transplant Technology (100%) operations were discontinued. During
the fiscal year 1997, the Company sold Moonridge Development Corp. Custom
Environmental International, Inc. is developing and marketing a carbon
regeneration furnace.  Plata Oro is involved in minerals exploration but has
been inactive for several years.  Moonridge Development Corp. develops
unimproved land in Las Vegas, Nevada.  Sterling Travel is a travel agency in
Boca Raton, Florida. Microsphere Technology and Islet Transplant Technology
are engaged in research and development of medical technology.  Mid-Nevada
Art, Inc. purchases artworks for lease and rental. Basia Holding, Inc. holds
title by quitclaim deed to approximately 9,000 unencumbered acres of land and
coal  reserves. All subsidiaries are inactive and the Company does not expect
any operations in aforementioned subsidiaries in the future.  The books and
records of the Company already reflect the writedown of investments in these
subsidiaries in prior years.


     Development Stage Enterprise

The Company has no revenues and has just commenced operations. The Company's
activities are accounted for as those of a "Development Stage Enterprise" as
set forth in Financial Accounting Standards Board Statement No. 7 ("SFAS 7").
Among the disclosures required by SFAS 7 are that the Company's financial
statements be identified as those of a development stage company, and that
the statements of operations, stockholders' equity(deficit) and cash flows
disclose activity since the date of the Company's inception.


 2.  SIGNIFICANT ACCOUNTING POLICIES

     Basis of Accounting

These financial statements are presented on the accrual method of accounting
in accordance with generally accepted accounting principles.  Significant
accounting principles followed by the Company and the methods of applying
those principles, which materially affect the determination of financial
position and cash flows, are summarized below.

     Basis of Consolidation

The accompanying consolidated financial statements include the accounts of
C.E.C Industries, Corp. and its wholly owned subsidiaries, as named above.
All significant intercompany transactions and balances have been eliminated
on consolidation
                                            F-6
<PAGE>

                 C.E.C. Industries, Corp. and Subsidiaries
                       (A Development Stage Company)
                       NOTES TO FINANCIAL STATEMENTS

 2.  SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

     Use of Estimates

The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and the disclosure
of contingent assets and liabilities at the date of the financial statements
and the reported amounts of revenue and expenses during the reporting period.
Actual results may differ from those estimates.

     Cash and Cash Equivalents

The Company considers all highly liquid debt instruments and investments,
purchased with an original maturity date of three months or less, to be cash
equivalents.

     Income Taxes

The Company accounts for income taxes under SFAS No. 109, which requires the
asset and liability approach to accounting for income taxes.  Under this
method, deferred assets and liabilities are measured based on differences
between financial reporting and tax bases of assets and liabilities
measured using enacted tax rates and laws that are expected to be in effect
when differences are expected to reverse.

     Net earnings(loss) per share

Basic and diluted net loss per share information is presented under the
requirements of SFAS No. 128, Earnings per Share.  Basic net loss per share
is computed by dividing net loss by the weighted average number of shares of
common stock outstanding for the period, less shares subject to repurchase.
Diluted net loss per share reflects the potential dilution of securities by
adding other common stock equivalents, including stock options, shares
subject to repurchase, warrants and convertible preferred stock, in the
weighted-average number of common shares outstanding for a period, if
dilutive.  All potentially dilutive securities have been excluded from this
computation, as their effect is anti-dilutive.

     Fair Value of Financial Instruments

The carrying amount of cash and accounts payable are considered to be
representative of their respective fair values because of the short-term
nature of these financial instruments


     Revenue Recognition

Royalty revenues are recorded as received from oil and gas leasehold
interests and retained overriding royalty rights.


 3.  RECENT ACCOUNTING PRONOUNCEMENTS

In July 2001, SFAS No. 141, "Business Combinations," and SFAS No. 142,
"Goodwill and Other Intangible Assets," were issued. SFAS No. 141 changes
certain accounting methods used for business combinations. Specifically, it
requires use of the purchase method of accounting for all business
combinations, and eliminates the pooling-of-interests method. SFAS No. 142
establishes new guidance on how to account for purchased intangible assets,
and for goodwill and intangible assets after a business combination is
completed.
                                            F-7
<PAGE>

                 C.E.C. Industries, Corp. and Subsidiaries
                       (A Development Stage Company)
                       NOTES TO FINANCIAL STATEMENTS

 3.  RECENT ACCOUNTING PRONOUNCEMENTS (CONTINUED)

In August 2001, the FASB issued SFAS No. 144, Accounting for the Impairment
or Disposal of Long-Lived Assets. SFAS No. 144 supercedes SFAS No. 121,
Accounting for the Impairment of Long-Lived Assets and Long-Lived Assets to
be Disposed of and APB No. 30, Reporting the Results of Operations -
Reporting the Effects of the Disposal of a Segment Business and
extraordinary, Unusual and Infrequently Occurring Events and Transactions.
SFAS No. 144 establishes a single accounting model for assets to be disposed
of by sale whether previously held and used or newly acquired. SFAS No. 144
retains the provisions of APB No. 30 for presentation of discontinued
operations in the income statement, but broadens the presentation to include
a component of an entity. SFAS No. 144 is effective for our fiscal year
beginning July 1, 2002.

In June 2002, the FASB issued SFAS No. 146, "Accounting for Costs Associated
with Exit or Disposal Activities", which addresses accounting for
restructuring and similar costs. SFAS NO. 146 supersedes previous accounting
guidance, principally Emerging Issues Task Force Issue No. 94-3. SFAS No 146
requires that the liability for costs associated with an exit or disposal
activity be recognized when the liability is incurred, SFAS No. 146 also
establishes that the liability should initially be measured and recorded at
fair value. Accordingly, SFAS No. 146 may affect the timing of recognizing
future restructuring costs as well as the amount recognized. SFAS NO. 146 is
effective for exit or disposal activities that are initiated after December
31, 2002.

In December 2002, the FASB issued SFAS No. 148 "Accounting for Stock-Based
Compensation-Transition and Disclosure - an amendment of FASB Statement No.
123" (FAS 148). The statement amends SFAS 123 "Accounting for Stock Based
Compensation:" (FAS 123) to provide alternative methods of voluntarily
transition to the fair value based method of accounting for stock based
employee compensation. FAS 148 also amends the disclosure requirement of FAS
123 to require disclosure of the method used to account for stock based
employee compensation and the effect of the method on reported results in
both annual and interim financial statements. The disclosure provisions will
be effective for the Company beginning with the Company's quarter ended March
31, 2003. The Company has no current intention to change its policy of
accounting for stock-based compensation.

In November 2002, the FASB Interpretation No. 45 (FIN 45) " Guarantor's
Accounting and Disclosure Requirements for Guarantees, Including Indirect
Guarantees of Indebtedness of Others." FIN 45 requires that a liability be
recorded in the guarantor's balance sheet upon issuance of certain
guarantees. FIN 45 also requires disclosure about certain guarantees that an
entity has issued. The Company has implemented the disclosure requirements
required by FIN 45, which were effective for fiscal years ending after
December 15, 2002. The Company will apply the recognition provisions of FIN
45 prospectively to guarantees issued after December 31, 2002.

In January 2003, the FASB issued FASB Interpretation No. 46 (FIN 46),
"Consolidation of Variable Interest Entities, and Interpretation of ARB

No.51." FIN 46 requires certain variable interest entities to be consolidated
by the primary beneficial of the entity if the equity investors in the entity
do not have characteristics of a controlling financial interest or do not
have sufficient equity at risk for the entity to finance its activities
without additional subordinated financial support from other parties. FIN 46
is effective for all new variable interest entities created or acquired after
January 31, 2003. For variable interest entities created or acquired prior to
February 1, 2003, the provisions of FIN 46 must be applied for the first
interim or annual period beginning on or after June 15, 2003.

                                            F-8
<PAGE>

                 C.E.C. Industries, Corp. and Subsidiaries
                       (A Development Stage Company)

                       NOTES TO FINANCIAL STATEMENTS

 3.  RECENT ACCOUNTING PRONOUNCEMENTS (CONTINUED)

On April 30, 2003 the FASB issued Statement No. 149, "Amendment of Statement
133 on Derivative Instruments and Hedging Activities." The Statement amends
and clarifies accounting for derivative instruments, including certain
derivative instruments embedded in other contracts, and for hedging
activities under Statement 133. The amendments set forth in Statement 149
improve financial reporting by requiring that contracts with comparable
characteristics be accounted for similarly. In particular, this Statement
clarifies under what circumstances a contract with an initial net investment
meets the characteristic of a derivative as discussed in Statement 133. In
addition, it clarifies when a derivative contains a financing component that
warrants special reporting in the statement of cash flows. This Statement is
effective for contracts entered into or modified after June 30, 2003.


On May 15, 2003 the FASB issued Statement No. 150, "Accounting for Certain
Financial Instruments with Characteristics of both Liabilities and Equity".
The Statement improves the accounting for certain financial instruments that,
under previous guidance, issuers could account for as equity. The new
Statement requires that those instruments be classified as liabilities in
statements of financial position. In addition to its requirements for the
classification and measurement of financial instruments in its scope,
Statement 150 also requires disclosures about alternative ways of settling
the instruments and the capital structure of entities, all of whose shares
are mandatorily redeemable. Most of the guidance in Statement 150 is
effective for all financial instruments entered into or modified after May
31, 2003.

Management's preliminary assessment of these recent pronouncements is that
they will not have a material impact on the Company's financial position or
results of operations since the Company is inactive.

 4.  TECHNOLOGY RIGHTS

On December 30, 2003 the Company acquired certain technology rights from
PayCard, a company providing payroll debit cards to employers and individuals.
This purchase was part of a purchase of 80% of the common stock of PayCard.
However, this acquisition was short lived and the shares reverted back to the
original owners before the year end.  The Company however retained the
technology rights to the software which were subsequently sold in June 2004
for reduction of certain debt of the Company for $ 255,000.  The writedown of
the technology rights has been reflected in the operating statement of the
Company.

 5.  CAPITAL STOCK TRANSACTIONS

On December 2, 2002, the Company consummated a 100:1 reverse stock split.

On December 2, 2002, the Company authorized a 100:1 reverse split.  All
common stock issues are listed as if the reverse had been effect all periods.

On December 3, 2002, the Company filed a S-8 authorizing the issuance of
10,000,000 of its par value $.001 common stock per the filed stock plan.

On December 3, 2002, the Company issued 200,000 shares of its Common Stock at
$.007 per share per its S-8 stock plan.

December 5, 2002, the Company issued 1,300,000 shares of its Common Stock at
$.007 per share per its S-8 stock plan.

                                            F-9
<PAGE>

                 C.E.C. Industries, Corp. and Subsidiaries
                       (A Development Stage Company)
                       NOTES TO FINANCIAL STATEMENTS

 5.   CAPITAL STOCK TRANSACTIONS (CONTINUED)

On January 13, 2003, the Company issued 400,000 shares of its Common Stock at
$.007 per share per its S-8 stock plan.

On January 16, 2003, the Company issued 2,000,000 shares of its Common Stock
at $.007 per share per its S-8 stock plan.

On January 16, 2003, the board of directors authorized 30,000,000 shares of
the Company's Common Stock to be issued to the president for executive
compensation.  The stock is restricted and was valued at the S-8 issue price
of $.007 per share.

During the year ended March 31, 2004 the Company issued a total of 19,665,000
to consultants and management for consulting services rendered at a prices of
$ .027 and $ .007 respectively.

On December 30, 2003 the Company issued 3,000,000 shares of restricted common
stock for certain technology rights at a price of $ .10 per share.

From January 2004 to March 31, 2004 the Company issued a total of  1,700,000
shares of restricted common stock to consultants at a price of $ .007 per share.

 6.  CONVERTIBLE NOTES PAYABLE

On November 1, 2003, the Company issued $ 150,000 in convertible notes payable
in connection with certain advances.  These advances were subsequently
increased to $ 218,700.  The notes bear interest at the rate of 6.5% interest
and are due November 1, 2004.  These notes are convertible into common stock
based 70% of the average of the lowest of three days trading during the five
days preceding the conversion or the average of the lowest three days trading
prices during the five days preceding the funding dates of these notes.

 7.  INCOME TAXES

There has been no provision for U.S. federal, state, or foreign income taxes
for any period because the Company has incurred losses in all periods and for
all jurisdictions.

Deferred income taxes reflect the net tax effects of temporary differences
between the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for income tax purposes. Significant
components of deferred tax assets are as follows:

Deferred tax assets
   Net operating loss carry forwards             $10,619,659
   Valuation allowance for deferred tax assets   $10,619,659)
                                                 ------------
   Net deferred tax assets                       $         -
                                                 ------------
                                                 ------------

Realization of deferred tax assets is dependent upon future earnings, if any,
the timing and amount of which are uncertain.  Accordingly, the net deferred
tax assets have been fully offset by a valuation allowance. As of March 31,
2004, the Company had net operating loss carry forwards of approximately
$10,619,659 for federal and state income tax purposes.  These carry forwards,
if not utilized to offset taxable income begin to expire in 2018.
Utilization of the net operating loss may be subject to substantial annual
limitation due to the ownership change limitations provided by the Internal
Revenue Code and similar state provisions.  The annual limitation could
result in the expiration of the net operating loss before utilization

                                    F-10
<PAGE>

                 C.E.C. Industries, Corp. and Subsidiaries
                       (A Development Stage Company)
                       NOTES TO FINANCIAL STATEMENTS

 8.  RELATED PARTY TRANSACTIONS

On June 17, 2003, the Company issued 1,500,000 shares of its common stock to
its president, Mr. Brian Dvorak for executive compensation amounting to
$ 10,500.

Accounts payable includes $595,516 (2003- $595,516) owing to the
President and major shareholder of the Company.

 9.  COMMITMENTS & CONTINGENCIES

In a lawsuit subsequent to the date of the financial statements, a judgment
was entered in United States District Court, District of Utah, Central
Division, against C.E.C. Industries, Inc. in favor of George A. Matthews, Jr.
A former President and Director of C.E.C Industries.  The judgment was for
the amount of $207,306.93.  The company has filed an appeal with the United
States Court of Appeals for the Tenth Circuit.  The company has been unable
to post a bond.

As of the date hereof, the Company is not aware of any other material legal
proceedings, pending or contemplated, to which the Company is, or would be, a
party of which any of its property is, or would be the subject.

10.  GOING CONCERN

The accompanying financial statements have been prepared in conformity with
generally accepted accounting principles, which contemplates continuation of
the Company as a going concern.

The future success of the Company is likely dependent on its ability to
attain additional capital to develop its proposed business objectives and
ultimately, upon its ability to attain future profitable operations.

There can be no assurance that the Company will be successful in obtaining
financing, or that it will attain positive cash flow from operations.

The Company has sustained substantial losses over the years, the ability of
the Company to continue as a going concern is in question.

11.  SUBSEQUENT EVENTS

In June, 2004, the Company exchanged its remaining interest in certain
technology rights, acquired on December 30, 2003, for the reduction of debt
totaling $255,000.

In July, 2004 the Company entered into agreements to sell its remaining assets.

The company has prepared unaudited pro forma financial statements to reflect
these events had they transpired or been known prior to March 31, 2004.
See Item 8 of the Company's 10K for March 31, 2004.

                                            F-11