================================================================================


                UNITED STATES SECURITIES AND EXCHANGE COMMISSION

                             Washington, D. C. 20549

                                   FORM 10-KSB
                                  AMENDMENT # 1

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

                   For the fiscal year ended December 31, 2005

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

          For the transition period from _____________ to _____________

                           Commission File No. 0-28181
                           ---------------------------

                                  ORANCO, INC.
                  --------------------------------------------
                 (Name of Small Business Issuer in its Charter)

                Nevada                                  87-05744
     (State or Other Jurisdiction of            (I.R.S. Employer I.D. No.)
      incorporation or organization)

                         1981 East 4800 South, Suite 110
                           Salt Lake City, Utah 84117
                           --------------------------
                    (Address of Principal Executive Offices)
                    Issuer's Telephone Number: (702) 939-4728

             -------------------------------------------------------
          (Former Name or Former Address, if changed since last Report)

Securities Registered under Section 12(b) of the Exchange Act:   None
Name of Each Exchange on Which Registered:                       None
Securities Registered under Section 12(g) of the Exchange Act:   Common

     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 Company was required to file such reports),  and (2) has
been subject to such filing requirements for the past 90 days.

     (1)   Yes  [X]    No [ ]           (2)   Yes [X]    No  [ ]

     Check  if  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  Company'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. [ ]

     Indicate  by check mark  whether  the  registrant  is a shell  company  (as
defined in Rule 12b-2 of the Exchange Act) Yes [X] No [ ]



                                      -1-
<PAGE>


     State Issuer's revenues for its most recent fiscal year.
                           December 31, 2005 -$90,178
                           --------------------------

     State the aggregate market value of the voting stock held by non-affiliates
computed by reference  to the price at which the stock was sold,  or the average
bid and asked  prices of such stock,  as of a specified  date within the past 60
days.

     At  March  20,  2005,  the  market  value  of  the  voting  stock  held  by
non-affiliates is undeterminable and is considered to be 0.

                     (APPLICABLE ONLY TO CORPORATE ISSUERS)

     State the number of shares  outstanding of each of the Issuer's  classes of
common equity, as of the latest practicable date:

                                 March 20, 2006
                                    4,269,950

                       DOCUMENTS INCORPORATED BY REFERENCE

List hereunder the following documents if incorporated by reference and the part
of the form 10- KSB (e.g.,  part I, part II,  etc.) into which the  document  is
incorporated:  (1) Any annual report to security holders; (2) any proxy or other
information statement;  and (3) Any prospectus filed pursuant to rule 424 (b) or
(C)) under the Securities Act of 1933: None





                                      -2-
<PAGE>



                                TABLE OF CONTENTS
================================================================================


PART I
------                                                                      Page
                                                                            ----
ITEM 1.    DESCRIPTION OF BUSINESS                                            4

ITEM 2.    DESCRIPTION OF PROPERTIES                                          9

ITEM 3.    LEGAL PROCEEDINGS                                                  9

ITEM 4.    SUBMISSION OF MATTERS TO VOTE OF SECURITY HOLDERS                  9

PART II
-------

ITEM 5.    MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS           9

ITEM 6.    MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION         10

ITEM 7.    FINANCIAL STATEMENTS                                              12

ITEM 8.    CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
           AND FINANCIAL DISCLOSURE                                          12

ITEM 8A.   CONTROLS AND PROCEDURES                                           12

ITEM 8B.   OTHER INFORMATION                                                 12

PART III
--------

ITEM 9.    DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS, AND CONTROL PERSONS;
           COMPLIANCE WITH SECTION 16 (a) OF THE EXCHANGE ACT                13

ITEM 10.   EXECUTIVE COMPENSATION                                            15

ITEM 11.   SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
           AND MANAGEMENT                                                    16

ITEM 12.   CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS                    18

PART IV
-------

ITEM 13.   EXHIBITS                                                          18

ITEM 14.   PRINCIPAL ACCOUNTANT FEES AND SERVICES                            19





                                      -3-
<PAGE>


                                     PART I

Item 1.  Description of Business.
---------------------------------

Business Development.
---------------------

Organization and Charter Amendments.
------------------------------------


     Oranco,  Inc., (the "Company") was incorporated under the laws of the State
of  Nevada,  on June 10,  1977.  The  purposes  for  which the  corporation  was
organized were: (1)to engage in any lawful business from time to time authorized
by the board of  directors,  (2) to act as  principal,  agent,  partner or joint
venturer  or in any  other  capacity  in  any  transaction,  (3) to do  business
anywhere in the world,  and (4) to have and  exercise all rights and powers from
time to time granted to the corporation by law. From 1977 until 1981 the Company
was dormant and undertook no activities.  Beginning in 1982 the Company explored
the option of entering into a joint venture to develop a mercury mining property
at Mercury Mountain,  Nevada. As a part of these activities the Company, through
the  sale of its  common  stock,  raised  funds to  engage  the  services  of an
independent  mining  engineer  to  prepare  a report on the  feasibility  of the
project.  By late 1983 it had been  determined  that the project did not warrant
any  further  investment.  From that time  until 1997 the  Company's  activities
concentrated  on  maintaining  its  corporate  existence  and  looking for other
opportunities  for the Company.  In May of 1997 new management was appointed,  a
shareholders'  meeting  was  held,  amendments  to  the  Company's  articles  of
incorporation were approved, and additional effort was made by new management to
make the Company a viable merger candidate.  These efforts included engaging the
services of a certified Public Accounting firm to audit the Company's  financial
statements,  obtaining  an  Opinion  of  Counsel  as to the  tradability  of the
Company's  outstanding shares,  preparation of the information  required by Rule
15c2-11, and applying to the OTC Bulletin Board for trading on the medium.

     By September of 1999, no viable  acquisitions or merger candidates had been
located for the Company and  management  became aware that the Company  would be
required to register  its shares  under the  Securities  Exchange Act of 1934 in
order to maintain its stock on the OTC  Bulletin  Board.  Management  determined
that the Company needed new management which might be better  positioned to find
a suitable  acquisition or merger  candidate and which would be in a position of
funding the upcoming expenses of the Company. On September 1, 1999 management of
the Company  resigned and Claudio  Gianascio  was appointed as sole director and
officer. On November 9, 1999 the Company sold 700,000 of its common stock to Mr.
Gianascio for $.05 per share,  netting a total of $35,000.  On November 18, 1999
the Company filed a registration  statement on Form 10SB which became  effective
sixty days thereafter.

     The  Company had an initial  authorized  capital of $25,000  consisting  of
100,000 shares of $.25 par value common stock. On June 10, 1997 the shareholders
approved an amendment to the Articles of  Incorporation  of The Company changing
the  authorized  capital  to  100,000,000  shares  at a par  value of $.001  and
providing  for a 10 to 1 share  forward  split of the  outstanding  shares.  The
Articles of Amendment were filed with the State of Nevada on August 6, 1998.

     In the  summer  of 2000,  the  Company  completed  a private  placement  of
2,500,000 units for which it received  $250,000 Each unit consisted of one share
of  common  stock;  one "a"  warrant  giving  the  holder  thereof  the right to
purchase,  upon a minimum  of 60 days  prior  notice of  exercise,  one share of
common stock at $.10 per share within two years of the date of issuance; and one
"b" warrant giving the holder  thereof the right to purchase,  upon a minimum of
60 days prior  notice of  exercise,  one share of common stock at $.25 per share
within two years of the date of issuance.


                                      -4-
<PAGE>


Business.
---------

     Other than the  above-referenced  matters  and  seeking  and  investigating
potential  assets,  properties or businesses to acquire,  the Company has had no
business operations since inception.  To provide revenue on an interim basis, on
March  29,  2004 the  Company  entered  into an  agreement  with  Air  Packaging
Technologies,  Inc.("AIRP")  to fund an evaluation of a lawsuit by it against 3M
Corp. for 3M's failure to use reasonable efforts to sell the products of AIRP to
which it had exclusive rights,  thus causing the failure of AIRP's business plan
for lack of revenue.  The cause of action was settled in September of 2005.  All
amounts  advanced  by the  Company on this  matter  were  considered  loans with
interest at 12% per annum and secured by a lien  against the assets of AIRP.  In
the event of a recovery,  the  Company  was  entitled to a return of all amounts
advanced and 60% of the net proceeds from the recovery. As of September 30, 2002
the Company had advanced $99,327,  including accrued interest.  In November 2005
the  Company  received  payment of  $178,833,  which  repaid the Company for all
amounts  advanced,  12% interest,  and 60% of the net proceeds received from the
recovery.

     To the extent that the Company  intends to continue to seek the acquisition
of  assets,   property  or  business  that  may  benefit  the  Company  and  its
stockholders, it is essentially a "blank check" company. Because the Company has
limited assets and conducts no business,  management  anticipates  that any such
acquisition  would  require it to issue  shares of its common  stock as the sole
consideration  for the acquisition.  This may result in substantial  dilution of
the shares of current stockholders.  The Company's Board of Directors shall make
the final determination  whether to complete any such acquisition;  the approval
of stockholders will not be sought unless required by applicable laws, rules and
regulations,  its Articles of Incorporation or Bylaws, or contract.  The Company
makes no assurance that any future enterprise will be profitable or successful.

     The Company is not currently engaging in any substantive  business activity
and has no plans to engage in any such activity in the  foreseeable  future.  In
its present form,  the Company may be deemed to be a vehicle to acquire or merge
with a business or company.  The Company  does not intend to restrict its search
to any particular business or industry,  and the areas in which it will seek out
acquisitions,  reorganizations  or mergers may include,  but will not be limited
to, the fields of high technology,  manufacturing,  natural resources,  service,
research and development, communications,  transportation, insurance, brokerage,
finance and all medically related fields,  among others.  The Company recognizes
that the number of suitable potential business ventures that may be available to
it may be extremely  limited,  and may be  restricted  to entities who desire to
avoid what  these  entities  may deem to be the  adverse  factors  related to an
initial public  offering  ("IPO").  The most prevalent of these factors  include
substantial  time  requirements,  legal and accounting  costs,  the inability to
obtain an underwriter who is willing to publicly offer and sell shares, the lack
of or the  inability to obtain the  required  financial  statements  for such an
undertaking,  limitations  on the  amount of  dilution  to public  investors  in
comparison to the stockholders of any such entities, along with other conditions
or requirements  imposed by various federal and state securities laws, rules and
regulations.  Any of these types of  entities,  regardless  of their  prospects,
would require the Company to issue a substantial  number of shares of its common
stock to  complete  any such  acquisition,  reorganization  or  merger,  usually
amounting to between 80 and 95 percent of the outstanding  shares of the Company
following the completion of any such  transaction;  accordingly,  investments in
any such private  entity,  if available,  would be much more  favorable than any
investment in the Company.

     In the event that the Company  engages in any  transaction  resulting  in a
change of control of the  Company  and/or the  acquisition  of a  business,  the
Company will be required to file with the  Commission  a Current  Report on Form
8-K within 15 days of such  transaction.  A filing on Form 8-K also requires the


                                      -5-
<PAGE>


filing of audited financial statements of the business acquired,  as well as pro
forma financial  information  consisting of a pro forma condensed balance sheet,
pro forma statements of income and accompanying explanatory notes.

     Management  intends to  consider  a number of  factors  prior to making any
decision as to whether to participate in any specific business endeavor, none of
which may be  determinative  or provide  any  assurance  of  success.  These may
include,  but will not be limited to an analysis of the quality of the  entity's
management  personnel;  the  anticipated  acceptability  of any new  products or
marketing concepts;  the merit of technological  changes;  its present financial
condition,  projected  growth potential and available  technical,  financial and
managerial  resources;  its working  capital,  history of operations  and future
prospects;  the nature of its present and expected competition;  the quality and
experience  of its  management  services  and the depth of its  management;  its
potential  for  further  research,  development  or  exploration;  risk  factors
specifically  related to its  business  operations;  its  potential  for growth,
expansion and profit;  the  perceived  public  recognition  or acceptance of its
products,  services,  trademarks  and name  identification;  and numerous  other
factors  which are  difficult,  if not  impossible,  to properly  or  accurately
analyze, let alone describe or identify, without referring to specific objective
criteria.

     Regardless,  the  results  of  operations  of any  specific  entity may not
necessarily be indicative of what may occur in the future, by reason of changing
market  strategies,  plant or product  expansion,  changes in product  emphasis,
future management  personnel and changes in innumerable other factors.  Further,
in  the  case  of a new  business  venture  or one  that  is in a  research  and
development mode, the risks will be substantial,  and there will be no objective
criteria to examine the  effectiveness or the abilities of its management or its
business  objectives.  Also,  a firm market for its products or services may yet
need to be established,  and with no past track record, the profitability of any
such entity will be unproven and cannot be predicted with any certainty.

     Management  will  attempt  to  meet  personally  with  management  and  key
personnel  of the entity  sponsoring  any business  opportunity  afforded to the
Company,  visit and inspect material facilities,  obtain independent analysis or
verification  of  information   provided  and  gathered,   check  references  of
management  and key  personnel  and conduct other  reasonably  prudent  measures
calculated to ensure a reasonably  thorough  review of any  particular  business
opportunity;  however,  due to time constraints of management,  these activities
may be limited.

     The Company is unable to predict the time as to when and if it may actually
participate in any specific  business  endeavor.  The Company  anticipates  that
proposed  business  ventures  will  be made  available  to it  through  personal
contacts  of  directors,   executive   officers  and   principal   stockholders,
professional advisors, broker dealers in securities,  venture capital personnel,
members  of the  financial  community  and others  who may  present  unsolicited
proposals.  In certain cases,  the Company may agree to pay a finder's fee or to
otherwise  compensate  the persons who submit a potential  business  endeavor in
which  the  Company  eventually  participates.  Such  persons  may  include  the
Company's directors,  executive officers, beneficial owners or their affiliates.
In this  event,  such  fees may  become a factor  in  negotiations  regarding  a
potential acquisition and,  accordingly,  may present a conflict of interest for
such individuals.

     Although the Company has not identified any potential  acquisition  target,
the possibility  exists that the Company may acquire or merge with a business or
company in which the Company's executive officers, directors,  beneficial owners
or their affiliates may have an ownership interest.  Current Company policy does
not  prohibit  such  transactions.  Because  no such  transaction  is  currently
contemplated,  it is impossible to estimate the potential  pecuniary benefits to
these persons.

     Further,  substantial fees are often paid in connection with the completion
of these types of acquisitions, reorganizations or mergers, ranging from a small
amount to as much as $250,000. These fees are usually divided among promoters or


                                      -6-
<PAGE>


founders,  after deduction of legal,  accounting and other related expenses, and
it is not  unusual  for a  portion  of  these  fees  to be paid  to  members  of
management or to principal  stockholders as consideration for their agreement to
retire a portion of the shares of common stock owned by them.  In the event that
such  fees are paid,  they may  become a factor in  negotiations  regarding  any
potential acquisition by the Company and, accordingly, may present a conflict of
interest for such individuals.

Principal Products and Services.
--------------------------------

     The  limited  business  operations  of the  Company,  as now  contemplated,
involve those of a "blank check" company. The only activities to be conducted by
the  Company  are to  manage  its  current  limited  assets  and to seek out and
investigate the  acquisition of any viable business  opportunity by purchase and
exchange for securities of the Company or pursuant to a reorganization or merger
through which securities of the Company will be issued or exchanged.

Distribution Methods of the Products or Services.
-------------------------------------------------

     Management will seek out and  investigate  business  opportunities  through
every reasonably available fashion, including personal contacts,  professionals,
securities broker dealers,  venture capital personnel,  members of the financial
community and others who may present unsolicited proposals; the Company may also
advertise its  availability as a vehicle to bring a company to the public market
through a "reverse" reorganization or merger.

Status of any Publicly Announced New Product or Service.
--------------------------------------------------------

     None; not applicable.

Competitive Business Conditions.
--------------------------------

     Management  believes  that there are  literally  thousands of "blank check"
companies engaged in endeavors similar to those engaged in by the Company;  many
of  these  companies  have   substantial   current  assets  and  cash  reserves.
Competitors  also  include  thousands  of other  publicly-held  companies  whose
business  operations  have proven  unsuccessful,  and whose only viable business
opportunity is that of providing a publicly-held vehicle through which a private
entity may have access to the public capital markets. There is no reasonable way
to predict the  competitive  position of the Company or any other  entity in the
strata of these endeavors;  however, the Company, having limited assets and cash
reserves,  will no doubt be at a  competitive  disadvantage  in  competing  with
entities which have recently  completed  IPO's,  have significant cash resources
and have recent operating  histories when compared with the complete lack of any
substantive operations by the Company for the past several years.

Sources and Availability of Raw Materials and Names of Principal Suppliers.
--------------------------------------------------------------------------

     None; not applicable.

Dependence on One or a Few Major Customers.
-------------------------------------------

     None; not applicable.



                                      -7-
<PAGE>


Patents, Trademarks, Licenses, Franchises, Concessions, Royalty Agreements
--------------------------------------------------------------------------
or Labor Contracts.
-------------------

     None; not applicable.

Need for any Governmental Approval of Principal Products or Services.
---------------------------------------------------------------------

     Because the Company currently  produces no products or services,  it is not
presently subject to any governmental regulation in this regard. However, in the
event that the Company  engages in a merger or acquisition  transaction  with an
entity  that  engages  in  such  activities,  it  will  become  subject  to  all
governmental  approval  requirements  to which the merged or acquired  entity is
subject.


Effect of Existing or Probable Governmental Regulations on Business.
--------------------------------------------------------------------

     The integrated  disclosure system for small business issuers adopted by the
Commission  in  Release  No.  34- 30968 and  effective  as of August  13,  1992,
substantially  modified the information  and financial  requirements of a "Small
Business  Issuer,"  defined to be an issuer  that has  revenues of less than $25
million;  is a U.S. or Canadian issuer; is not an investment  company;  and if a
majority-owned subsidiary, the parent is also a small business issuer; provided,
however,  an entity is not a small business issuer if it has a public float (the
aggregate  market  value  of  the  issuer's   outstanding   securities  held  by
non-affiliates) of $25 million or more.

     The  Commission,  state  securities  commissions  and  the  North  American
Securities Administrators Association, Inc. ("NASAA") have expressed an interest
in adopting  policies that will streamline the registration  process and make it
easier for a small business issuer to have access to the public capital markets.
The present laws, rules and regulations  designed to promote availability to the
small  business  issuer of these  capital  markets and similar  laws,  rules and
regulations  that may be  adopted  in the future  will  substantially  limit the
demand for "blank  check"  companies  like the Company,  and may make the use of
these companies obsolete.

Research and Development.
-------------------------

     None; not applicable.

Cost and Effects of Compliance with Environmental Laws.
-------------------------------------------------------

     None; not applicable.  However,  environmental  laws, rules and regulations
may have an adverse  effect on any business  venture viewed by the Company as an
attractive  acquisition,  reorganization or merger candidate,  and these factors
may further  limit the number of potential  candidates  available to the Company
for acquisition, reorganization or merger.

Number of Employees.
--------------------

     None.


                                      -8-
<PAGE>


Item 2. Description of Property.
--------------------------------


     The Company has no assets,  property or business;  its principal  executive
office  address  and is the  business  office  address  of its  transfer  agent,
Interwest  Transfer Co., Inc., and is currently provided at no cost. Because the
Company has had no business, its activities will be limited to keeping itself in
good standing in the State of Nevada, seeking out acquisitions,  reorganizations
or mergers and preparing and filing the appropriate  reports with the Securities
and Exchange Commission.  These activities have consumed an insubstantial amount
of management's time.

Item 3. Legal Proceedings.
--------------------------

     The  Company  is  not a  party  to any  pending  legal  proceeding.  To the
knowledge  of  management,  no federal,  state or local  governmental  agency is
presently  contemplating  any  proceeding  against  the  Company.  No  director,
executive officer or affiliate of the Company or owner of record or beneficially
of more than five percent of the  Company's  common stock is a party  adverse to
the Company or has a material interest adverse to the Company in any proceeding.

Item 4. Submission of Matters to a Vote of Security Holders.
------------------------------------------------------------

     No matter was submitted to a vote of the Company's  security holders during
the fourth quarter of the calendar year covered by this Report.



                                     PART II

Item 5. Market for Common Equity and Related Stockholder Matters.

-----------------------------------------------------------------


Market Information
------------------

     There is no  "public  market"  for shares of common  stock of the  Company.
Although  the  Company's  shares  are  quoted on the OTC  Bulletin  Board of the
National  Association  of Securities  Dealers,  the Company is aware of only two
transactions  having taken place, one in the year 2000 and the other in 2005. In
any event,  no assurance can be given that any market for the  Company's  common
stock will develop or be maintained.

     The  ability  of an  individual  shareholder  to trade  their  shares  in a
particular  state may be subject to various rules and regulations of that state.
A number of states  require that an issuer's  securities  be registered in their
state or  appropriately  exempted from  registration  before the  securities are
permitted  to  trade  in that  state.  Presently,  the  Company  has no plans to
register  its  securities  in any  particular  state.  Further,  most likely the
Company's  shares will be subject to the  provisions  of Section  15(g) and Rule
15g-9 of the Securities  Exchange Act of 1934, as amended (the "Exchange  Act"),
commonly referred to as the "penny stock" rule. Section 15(g) sets forth certain
requirements for transactions in penny stocks and Rule 15g-9(d)(1)  incorporates
the definition of penny stock as that used in Rule 3a51-1 of the Exchange Act.




                                      -9-
<PAGE>


     The Commission generally defines penny stock to be any equity security that
has a market  price less than $5.00 per  share,  subject to certain  exceptions.
Rule 3a51-1  provides that any equity security is considered to be a penny stock
unless that security is: registered and traded on a national securities exchange
meeting  specified  criteria set by the Commission;  authorized for quotation on
The NASDAQ Stock Market;  issued by a registered  investment  company;  excluded
from the  definition  on the basis of price (at  least  $5.00 per  share) or the
issuer's net tangible assets; or exempted from the definition by the Commission.
If the  Company's  shares are deemed to be a penny stock,  trading in the shares
will be subject to additional sales practice requirements on broker- dealers who
sell penny stocks to persons other than  established  customers  and  accredited
investors,  generally  persons  with  assets in excess of  $1,000,000  or annual
income exceeding $200,000, or $300,000 together with their spouse.

     For transactions covered by these rules, broker-dealers must make a special
suitability  determination  for the  purchase of such  securities  and must have
received  the  purchaser's  written  consent  to the  transaction  prior  to the
purchase.  Additionally,  for any  transaction  involving a penny stock,  unless
exempt,  the rules require the delivery,  prior to the first  transaction,  of a
risk disclosure  document  relating to the penny stock market.  A broker- dealer
also must disclose the  commissions  payable to both the  broker-dealer  and the
registered representative,  and current quotations for the securities.  Finally,
monthly  statements  must be sent  disclosing  recent price  information for the
penny stocks held in the account and  information on the limited market in penny
stocks. Consequently,  these rules may restrict the ability of broker-dealers to
trade and/or maintain a market in the Company's  Common stock and may affect the
ability of shareholders to sell their shares.

Holders
-------

     The number of record  holders of the Company's  common stock as of the date
of this Report is approximately 45.

Dividends
---------

     The Company has not declared any cash  dividends with respect to its common
stock and does not intend to declare  dividends in the foreseeable  future.  The
future dividend policy of the Company cannot be ascertained  with any certainty,
and until the Company completes any acquisition, reorganization or merger, as to
which no assurance may be given, no such policy will be formulated. There are no
material  restrictions  limiting,  or that are  likely to limit,  the  Company's
ability to pay dividends on its common stock.

Sales of "Unregistered" and "Restricted" Securities Over The Past Three Years.
-----------------------------------------------------------------------------

     In March 2005 the Company  issued  250,000  shares of stock pursuant to the
exercise of outstanding  employee  stock options issued  pursuant to Rule 701 of
the  Securities  Act of 1933.  The  purchase  price  was  $0.10  per share or an
aggregate of $25,000. This increased the outstanding shares to 4,269,950.

Item 6. Management's Discussion and Analysis or Plan of Operation.
------------------------------------------------------------------


Plan of Operation.
------------------

     The Company has not engaged in any material  operations or had any revenues
from operations since inception. The Company's plan of operation for the next 12
months  is to  continue  to  seek  the  acquisition  of  assets,  properties  or
businesses that may benefit the Company and its stockholders. Management intends
to focus is efforts  in Europe  both  because  management  is located  there and
because  management  believes that the Company can locate  superior  acquisition


                                      -10-
<PAGE>


opportunities  in  Europe.  Management  anticipates  that to  achieve  any  such
acquisition,  the  Company  will issue  shares of its  common  stock as the sole
consideration for such acquisition.

     During the next 12 months, the Company's only foreseeable cash requirements
will  relate to  maintaining  the  Company in good  standing  or the  payment of
expenses  associated  with  reviewing or  investigating  any potential  business
venture, which the Company expects to pay from its cash resources.  In addition,
it agreed to fund the  evaluation  of a lawsuit by Air  Packaging  Technologies,
Inc.  against 3M Corp.  as described  below.  As of December  31,  2005,  it had
$216,684 in cash or cash equivalents.  Management  believes that these funds are
sufficient to cover its cash needs for the next 12 months.  If additional  funds
are required  during this period,  such funds may be advanced by  management  or
stockholders as loans to the Company. Because the Company has not identified any
such  venture as of the date of this  Report,  it is  impossible  to predict the
amount  of any  such  loan.  However,  any  such  loan  will be on terms no less
favorable to the Company than would be available from a commercial  lender in an
arm's  length  transaction.  As of the date of this  Report,  the Company is not
engaged in any negotiations with any person regarding any venture.

Results of Operations.
----------------------

     Other than restoring and  maintaining  its good  corporate  standing in the
State of  Nevada,  obtaining  an audit of the  Company's  financial  statements,
submitting  the  Company's  common stock for quotation on the NASD OTC Bulleting
Board,  the filing of a Form 10  Registration,  and the  completion of a private
placement,  the Company has had no material business  operations in the two most
recent calendar years.

Year ended December 31, 2005 compared to year ended December 31, 2004
---------------------------------------------------------------------

     Revenues  for the year ended  December  31, 2005 were  $90,178  compared to
$6,770 for the year ended  December 31,  2004.  This  represents  an increase of
$83,408 or 1232%.  This  increase is  attributable  to settlement of the lawsuit
which  was the  basis  of the Air  Packaging  Technologies,  Inc.("AIRP")  Claim
against 3M Corp of the Company's share of the net proceeds therefrom.

     Expenses  for the year ended  December  31, 2005 were  $56,780  compared to
$14,697 for the year ended  December  31,  2004.  This  represents a increase of
$42,083  or  286%  and  is  attributable  to  a  increase  in  legal  and  other
administrative  costs to comply with recent SEC  requirements,  increased travel
due to AIRP settlement and meetings with prospective acquisition candidates, and
office expense to support AIRP claim.

     Net profit for the year ended  December 31, 2005 was $33,398  compared to a
net loss of  $7,297  for the year  ended  December  31,  2004.  This  profit  is
attributable  to settlement of the AIRP claim against 3M Corp. And the Company's
share of the settlement.

Liquidity.
----------

     The  Company's  primary  need  for  capital  has  been to pay  the  ongoing
administrative expenses associated with being a reporting company such as legal,
accounting and EDGAR filing. The Company,  although more aggressively seeking an
acquisition  or merger  partner  and  incurring  travel  and other  expenses  in
relation  thereto,  does not  anticipate  this  changing  in the next 12 months,
unless a suitable acquisition or merger candidate is located.  However,  because
of the limited amount  available no assurance can be given that this will be the
case.

     In addition,  on March 29, 2004 the Company  entered into an agreement with
Air Packaging  Technologies,  Inc.("AIRP") to fund an evaluation of a lawsuit by
it  against 3M Corp.  for 3M's  failure  to use  reasonable  efforts to sell the
products of AIRP to which it had exclusive  rights,  thus causing the failure of
AIRP's  business  plan for lack of  revenue.  The cause of action was settled in
September  of 2005.  All  amounts  advanced  by the  Company on this matter were
considered  loans with  interest at 12% per annum and secured by a lien  against
the assets of AIRP.  In the event of a recovery,  the Company was  entitled to a
return of all amounts advanced and 60% of the net proceeds from the recovery. As


                                      -11-
<PAGE>


of  September  30, 2002 the  Company had  advanced  $99,327,  including  accrued
interest.  In November  2005 the Company  received  payment of  $178,833,  which
repaid the Company for all amounts  advanced,  12% interest,  and 60% of the net
proceeds received from the recovery.

     During the fiscal  years ended  December 31, 2005 the Company has been able
to pay its expenses and costs  through it cash on hand.  As of December 31, 2005
had  $335,094 in cash or cash  equivalents  compared to $216,684 at December 31,
2004,  an  increase  of  $118,410.  This  increase is  primarily  attributed  to
repayment of the loan to AIRP for the 3M litigation, together with the Company's
share of the net proceeds of the settlement of the litigation.

Item 7. Financial Statements.
-----------------------------

     The  financial  statements  of  the  Company  are  included  following  the
signature pages to this form 10-KSB.

Item 8. Changes  in and  Disagreements  with  Accountants  on  Accounting  and
------------------------------------------------------------------------------
Financial Disclosure.
---------------------

NONE

Item 8A. Controls and Procedures
--------------------------------


     Based on an evaluation  as of the date of the end of the period  covered by
this Form 10-KSB, our Chief Executive Office/ Chief Financial Officer, conducted
an evaluation of the effectiveness of the design and operation of our disclosure
controls and procedures,  as required by Exchange Act Rule 13a-15. Based on that
evaluation,  our Chief Executive Officer/ Chief Financial Officer concluded that
our disclosure controls and procedures were effective to ensure that information
required to be  disclosed  by us in the reports that we file or submit under the
Exchange Act is recorded,  processed,  summarized  and reported  within the time
periods  specified by the SEC's rules and forms.  In addition,  he has concluded
that  these  controls  and  procedures  are also  effective  to ensure  that the
information required to be disclosed in the reports that we file or submit under
the Exchange Act is accumulated and  communicated  to management,  including the
Chief Executive Officer, to allow timely decisions regarding required disclsure.


Changes in Internal Controls

     There were no significant  changes in our internal  controls over financial
reporting that occurred during the quarter and year ended December 31, 2005 that
have materially  affected,  or are reasonably likely to materially  affect,  our
internal control over financial reporting.

Limitations on the Effectiveness of Controls


     We believe that a control system, no matter how well designed and operated,
cannot provide absolute  assurance that the objectives of the control system are
met, and no  evaluation  of controls  can provide  absolute  assurance  that all
control  issues  and  instances  of fraud,  if any,  within a company  have been
detected.  However,  we believe that our controls and procedures are designed to
provide reasonable  assurance that the objectives of the controls and procedures
are met and the Chief Executive  Officer/Chief  Financial  Officer has concluded
that our disclosure  controls and  procedures  are effective at that  reasonable
assurance level.


Item 8b. Other Information
--------------------------

     None



                                      -12-
<PAGE>


                                    PART III


Item 9. Directors, Executive Officers, Promoters and Control Persons; Compliance
--------------------------------------------------------------------------------
With Section 16(a) of the Exchange Act.
---------------------------------------

Identification of Directors and Executive Officers
--------------------------------------------------

     The  following  table sets  forth the names of all  current  directors  and
executive  officers  of the  Company.  These  persons  will serve until the next
annual  meeting of the  stockholders  or until their  successors  are elected or
appointed and qualified, or their prior resignation or termination.

                                                         DATE ELECTED OR
NAME                       POSITION(S)                      APPOINTED
--------------------       ---------------------         ---------------
Claudio Gianascio          President, Secretary,
                           Treasurer, Director               09/01/99

Alfredo M. Villa           Director                         01/10/2000

Business Experience
-------------------

     Mr. Gianascio is presently an independent  financial  advisor and currently
residing in Andorra.  Formerly he was CEO and  Chairman of the Board of Givigest
Fiduciaria  S.A.,  a Swiss  financial  services  company he co- founded in 1990.
Until  2002  he was  also a  board  member  of III  Intermediazioni  Immobiliari
Internazionali S.A., a real estate company;  Until 2000 he was a board member of
SCF Societa di Consulenza  Finanziaria S.A., a Swiss private banking company and
a board  member of Zandano  and  Partners  S.A.,  a Swiss  financial  consulting
company. Mr. Gianascio holds a Master Degree in Economics which he received from
the University of Geneva,  Switzerland and is a licensed Fiduciario  Finanziario
within  the  state  of  Ticino,  Switzerland.  Prior  to co-  founding  Givigest
Fiduciaria  S.A.,  Mr.  Gianascio was employed  within the banking and financial
industries by Union Bank of Switzerland,  Manufacturers  Hanover  (Suisse) S.A.,
and Chemical Bank (Suisse) S.A..

     Mr. Villa graduated in Economics at University of Geneva, Switzerland.  Mr.
Villa's  career  started at Banca della  Svizzera  Italiana  as currency  option
dealer,  and then joined Soginvest Banca (CIAL Group), In 1991 he co- founded in
Lugano,  Switzerland,  Givigest  Fiduciaria  SA,  a firm  actively  involved  in
investment  banking.  In 1994 he co-founded SCF SA, a financial  consulting firm
offering asset management  services,  which was sold in 2001. He is a 'Chartered
Technical Analyst' (CTA) qualified by US Market  Technicians  Association in New
York,,  as well as an authorised  Financial & Commercial  Fiduciary in the Swiss
Canton of Ticino. Mr. Villa's current activities are based mainly in Italy where
he is a board member and partner of Gabrielli & Associati in Milan,  a financial
consulting  company  which  just  sold a  private  fund  with  100M  euro  under
management,  and a board member and a  shareholder  of  Mediapolis  S.p.A a real
estate company  established to develop the largest  amusement park in Italy. Mr.
Villa is also a non executive  director in Brainspark plc, a AIM Listed company.
Mr.  Villa is also an  independent  consultant  and private  investor in several
venture capital companies.  Mr. Villa is also Chairman of "Fondazione  Settembre
Onlus" and VP of "Homes for Hope" Charities.


                                      -13-
<PAGE>


Significant Employees.
----------------------

     The Company has no employees  who are not executive  officers,  but who are
expected to make a significant contribution to the Company's business.

Family Relationships.
---------------------

     There  are  no  family  relationships  between  any  current  directors  or
executive officers of the Company, either by blood or by marriage.

Audit Committee
---------------

     The Company  has no audit  committee  financial  expert,  as defined  under
Section  228.401,  serving  on its  audit  committee  because  it  has no  audit
committee  and is not  required to have an audit  committee  because it is not a
listed security as defined in Section 240.10A-3.

Code of Ethics
--------------

     The  Company has  adopted a code of ethics  that  applies to the  Company's
principal executive officer,  principal financial officer,  principal accounting
officer or  controller  which was  attached  hereto as Exhibit  99.1 to the 2003
10KSB of the Company.

Involvement in Certain Legal Proceedings.
-----------------------------------------

     Except as stated  above,  during the past five years,  no director,  person
nominated to become a director, executive officer, promoter or control person of
the Company:

     (1) was a general  partner or  executive  officer of any  business  against
which any bankruptcy petition was filed, either at the time of the bankruptcy or
two years prior to that time;

     (2) was  convicted in a criminal  proceeding  or named subject to a pending
criminal proceeding (excluding traffic violations and other minor offenses);

     (3) was  subject  to  any  order,  judgment  or  decree,  not  subsequently
reversed,  suspended  or  vacated,  of  any  court  of  competent  jurisdiction,
permanently or temporarily enjoining,  barring, suspending or otherwise limiting
his involvement in any type of business, securities or banking activities; or

     (4) was found by a court of competent jurisdiction (in a civil action), the
Securities and Exchange  Commission or the Commodity Futures Trading  Commission
to have  violated a federal or state  securities  or  commodities  law,  and the
judgment has not been reversed, suspended or vacated.

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


     Since the  Company  ceased  operations  in 1990,  the  Company  knows of no
person,  who at any time during the  subsequent  fiscal  years,  was a director,
officer,  beneficial  owner of more  than ten  percent  of any  class of  equity
securities  of the  registrant  registered  pursuant  to Section 12  ("Reporting
Person"),  that  failed to file on a timely  basis any  reports  required  to be
furnished  pursuant  to  Section  16 (a).  Based  upon a review of Forms 3 and 4
furnished to the  registrant  under Rule 16a-3(d)  during its most recent fiscal


                                      -14-
<PAGE>



year,  other than disclosed  below,  the registrant knows of no Reporting Person
that failed to file the required  reports  during the most recent fiscal year or
prior years.

     The  following  table  sets forth as of  December  31,  2005,  the name and
position of each  Reporting  Person  that  failed to file on a timely  basis any
reports required pursuant to Section 16(a) during the most recent fiscal year or
prior years.

     Name               Position             Reports Filed
     ----               --------             -------------

     NONE

Item 10. Executive Compensation.
--------------------------------

     The  following  table sets  forth the  aggregate  compensation  paid by the
Company for services rendered during the periods indicated

                           SUMMARY COMPENSATION TABLE
           Annual Compensation                    Awards           Payouts
-------------------------------------------  ----------------- -----------------

(a)            (b)      (c)    (d)    (e)     (f)      (g)     (h)      (I)
                                                     Secur-
                                                      Ities             All
Name and     Year or                 Other   Rest-    Under-   LTIP    Other
Principal    Period   Salary  Bonus  Annual  ricted   lying    Pay-    Comp-
Position      Ended     ($)    ($)   Compen  Stock  Options(#) outs   ensat'n
--------------------------------------------------------------------------------

Claudio
Gianascio,  12/31/2005   0     0       0       0        0       0        0
Pres, Sec,  12/31/2004   0     0       0       0        0       0        0
Treas, Dir  12/31/2003   0     0       0       0        0       0        0

** Claudio  Gianascio became an officer and director of the Company on September
1, 1999.

                      Option/SAR Grants in Last Fiscal Year
                      -------------------------------------
                                Individual Grants
                                -----------------

                No. Of Sec.     % of Total
                Underlying      Options/SARs
                Options/        Granted to       Exercise
                SARs            Employees        or Base
                Granted         In Fiscal        Price       Expiration
Name            (#)             Year             ($/Sh)      Date
----            -----------     ------------     ---------   ----------

NONE


                                      -15-
<PAGE>


Compensation of Directors.
--------------------------
     There  are  no  standard  arrangements  pursuant  to  which  the  Company's
directors are compensated for any services  provided as director.  No additional
amounts are payable to the Company's  directors for committee  participation  or
special assignments.

     There are no arrangements  pursuant to which any of the Company's directors
was  compensated  during the  Company's  last  completed  calendar  year for any
service provided as director.

Employment Contracts and Termination of Employment and Change-in-Control
------------------------------------------------------------------------
Arrangements.
-------------

     There are no  employment  contracts,  compensatory  plans or  arrangements,
including payments to be received from the Company, with respect to any director
or executive officer of the Company which would in any way result in payments to
any  such  person  because  of his  or  her  resignation,  retirement  or  other
termination  of  employment  with the Company or any  subsidiary,  any change in
control of the Company, or a change in the person's responsibilities following a
change in control of the Company.


Item 11. Security Ownership of Certain Beneficial Owners and Management.
--------------------------------------------------------------------------------

Security Ownership of Certain Beneficial Owners.
------------------------------------------------
     The  following  table sets forth the  shareholdings  of those  persons  who
beneficially  own more than five percent of the Company's common stock as of the
date of this Report,  with the computations being based upon 4,269,950 shares of
common stock being outstanding on March 20, 2006, unless otherwise noted.

                                      Number of Shares      Percentage
Name and Address                     Beneficially Owned    of Class (1)
---------------------------------    -------------------   -------------

Claudio Gianascio                         825,000              19.32%
La Pleta de Sant Pere
El Tartar, Canillo, Andorra

Comprehensive Ventures Inc. Ltd.          400,000               9.36%
Clinch's House Lord Street
Douglas, Isle of Man
British Isles IM99 1RZ

Progressive Emerging Ventures Ltd.        400,000               9.36%
Suite 743, Europort
P.O. Box 629
Gibraltar


                                      -16-
<PAGE>


Capital One International SA              350,000               8.19%
Torre Banco Germanico
P.O. Box 850048
Calle 50 Y 55 Este, 8th Floor
Panama, Republic of Panama

Prestige Underwriters NV                  350,000               8.19%
Middenstraat 1A,
P.O. Box 97
Willemstad, Curacao
Netherland Antilles

OTC Opportunities Limited                 350,000               8.19%
The Lake Building, First Floor
P.O. Box 915
Roadtown, BVI

(1) Percentage is calculated upon the 4,269,950 shares outstanding.

Security Ownership of Management.
---------------------------------

     The following table sets forth the shareholdings of the Company's directors
and executive officers as of the date of this Report:

                                        Number of                Percentage of
Name and Address                 Shares Beneficially Owned        of Class (1)
----------------                 --------------------------      -------------

Claudio Gianascio                        825,000                      19.32%
La Pleta de Sant Pere
El Tartar, Canillo, Andorra

Alfredo M. Villa                         125,000                       2.93%
Chelsea Court No. 2262
Triq 1-1M6HAZEL, Swiequi
Malta
                                         -------                      ------

All directors and
executive officers                       950,000                      22.25%
as a group (2 people)

(1) Percentage is calculated upon the 4,269,950 shares outstanding.


                                      -17-
<PAGE>


Changes in Control.
-------------------

     There are no present  arrangements  or pledges of the Company's  securities
which may result in a change in control of the Company.

Item 12. Certain Relationships and Related Transactions.
--------------------------------------------------------

Transactions with Management and Others.
----------------------------------------

     For a description  of  transactions  between  members of  management,  five
percent stockholders,  "affiliates",  promoters and finders, see captions "Sales
of 'Unregistered'  and 'Restricted'  Securities Over the Past Three Years" under
Item 5.

Item 13. Exhibits and Reports on Form 8-K.
------------------------------------------

Reports on Form 8-K
-------------------

NONE

Exhibits
--------

Exhibit
Number       Description*
-------      ------------

 3.1 *       Initial Articles of Incorporation,


 3.2 *       Articles of Amendment to the Articles of Incorporation,

 3.3 *       By-Laws

10.1 **      2000 non-Qualified Key Man Stock Option Plan

10.2 **      Form of Option Certificate delivered in connection with the grant
             of individual options.

31.1         Rule 13a-14(a)/15d-14(a) Certification.

32.1         Certification by the Chief Executive Officer/Acting Chief Financial
             Officer Relating to a Periodic Report Containing Financial
             Statements.***

99.1****     Code of Ethics

*** The  Exhibit  attached  to this Form 10-Q  shall not be deemed  "filed"  for
purposes of Section 18 of the  Securities  Exchange  Act of 1934 (the  "Exchange
Act") or otherwise  subject to  liability  under that  section,  nor shall it be
deemed incorporated by reference in any filing under the Securities Act of 1933,
as amended,  or the  Exchange  Act,  except as  expressly  set forth by specific
reference in such filing.


                                      -18-
<PAGE>


DOCUMENTS INCORPORATED BY REFERENCE

* Documents  previously  filed as exhibits to Form 10 filed on November 18, 1999
and incorporated herein by this reference.

** Documents  previously  filed as exhibits to Form 10KSB annual report for year
ending 12/31/99.

**** Documents  previously filed as exhibit to Form 10KSB annual report for year
ending 12/31/2003.

Item 14. Principal Accountant Fees and Services
-----------------------------------------------

Audit Fee
---------

The aggregate fees billed for each of the last two fiscal years for professional
services  rendered by the  principal  account  for the audit of Oranco's  annual
financial  statement  and review of  financial  statements  included in Oranco's
10-QSB  reports and services  normally  provided by the accountant in connection
with statutory and regulatory filings or engagements were $4,015 for fiscal year
ended 2004 and $4,105 for fiscal year ended 2005.

Audit-Related Fees
------------------

The aggregate fees billed in each of the last two fiscal years for assurance and
related services by the principal  accountant that are reasonably related to the
performance of the audit or review of Oranco's financial statements that are not
reported above were $ -0- for fiscal years ended 2004 and 2005.

Tax Fees
--------

The aggregate fees billed in each of the last two fiscal years for  professional
services  rendered by the principal  accountant for tax compliance,  tax advise,
and tax planning  were $150.00 for fiscal year ended 2004 and $150.00 for fiscal
year ended 2005.

All Other Fees
--------------

The aggregate  fees billed in each of the last two fiscal years for products and
services provided by the principal accountant,  other than the services reported
above were $ -0- for fiscal years ended 2004 and 2005.

We do not have an audit committee currently serving and as a result our board of
directors performs the duties of an audit committee. Our board of directors will
evaluate  and approve in  advance,  the scope and cost of the  engagement  of an
auditor before the auditor renders audit and non-audit services.  We do not rely
on pre-approval policies and procedures.

                                   SIGNATURES

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

                                             ORANCO, INC.



Date: 5/10/2006                              By S/Claudio Gianascio
                                                -------------------------
                                             Claudio Gianascio
                                             President, Secretary, Treasurer
                                             and Director






                                      -19-
<PAGE>


     Pursuant to the  requirements  of the  Securities  Exchange Act of 1934, as
amended, this Report has been signed below by the following persons on behalf of
the Company and in the capacities and on the dates indicated:

                                  ORANCO, INC.

Date: May 10, 2006                S/ Claudio Gianascio
                                  --------------------------------------------
                                   Claudio Gianascio
                                   President, Secretary,
                                   Treasurer and Director



Date: May 10, 2006                S/ Alfredo Villa
                                  --------------------------------------------
                                   Alfredo M. Villa
                                   Director






















                                      -20-
<PAGE>


MADSEN & ASSOCIATES, CPA's INC.                            684 East Vine St, # 3
-------------------------------                               Murray, Utah 84107
Certified Public Accountants and Business Consultants     Telephone 801-268-2632
                                                                Fax 801-262-3978



Board of Directors
Oranco, Inc.


             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We have audited the  accompanying  balance  sheet of Oranco,  Inc. ( development
stage   company)  at  December  31,  2005  and  the  statement  of   operations,
stockholders'  equity, and cash flows for the years ended December 31, 2005, and
2004 and the period June 16, 1977 (date of  inception)  to  December  31,  2005.
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 conducted  our audit 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 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  audits  provide  a
reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects,  the financial  position of Oranco,  Inc. at December 31,
2005 and the results of operations,  and cash flows for the years ended December
31, 2005 and 2004 and the period June 16, 1977 (date of  inception)  to December
31, 2005, in conformity with  accounting  principles  generally  accepted in the
United States of America.



March 13, 2006
Salt Lake City, Utah                    s/Madsen & Associates, CPA's Inc.










                                      -21-
<PAGE>



                                  ORANCO, INC.
                           (Development Stage Company)
                                  BALANCE SHEET
                                December 31, 2005

================================================================================


ASSETS
CURRENT ASSETS

  Cash                                                                $ 335,094
                                                                      ---------

     Total Current Assets                                             $ 335,094
                                                                      =========



LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES

  Accounts payable                                                    $   2,372
                                                                      ---------

     Total Current Liabilities                                            2,372
                                                                      ---------

STOCKHOLDERS' EQUITY

  Common stock
   100,000,000 shares authorized, at $0.001 par value;
      4,269,950 shares issued and outstanding                             4,270
   Capital in excess of par value                                       349,898
   Deficit accumulated during the development stage                     (21,446)
                                                                      ---------

     Total Stockholders' Equity                                         332,722
                                                                      ---------

                                                                      $ 335,094
                                                                      =========


    The accompanying notes are an integral part of these financial statements




                                      -22-
<PAGE>


                                  ORANCO, INC.
                           (Development Stage Company)
                            STATEMENTS OF OPERATIONS
             For the Years Ended December 31, 2005, and 2004 and the
          Period June 16, 1977 (Date of Inception) to December 31, 2005

================================================================================


                                      Dec 31,        Dec 31,     Jun 16, 1977 to
                                       2005           2004        Dec  31, 2005
                                    -----------    -----------   --------------

REVENUES                            $    90,178    $     6,770     $   150,945
                                    -----------    -----------     -----------

EXPENSES

 Administrative                          56,780         14,697         141,990
 Valuation adjustment-
  available-for-sale securities               -              -          30,401
                                    -----------    -----------     -----------
                                         56,780         14,697         172,391
                                    -----------    -----------     -----------

NET PROFIT (LOSS)                   $    33,398    $    (7,927)    $   (21,446)
                                    ===========    ===========     ===========



NET LOSS PER COMMON SHARE

 Basic and diluted                  $       .01    $         -
                                    -----------    -----------


AVERAGE  OUTSTANDING SHARES

 Basic                                4,207,950      4,019,950
                                    -----------    -----------






    The accompanying notes are an integral part of these financial statements


                                      -23-
<PAGE>


                                  ORANCO, INC.
                  STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
          Period June 16, 1977 (date of inception) to December 31, 2005
================================================================================

                                       Common Stock      Capital in
                                    ------------------   Excess of   Accumulated
                                    Shares      Amount   Par Value     Deficit
                                    ------      ------   ----------  -----------

Balance June 16, 1977
 (date of inception)                       -    $    -    $      -    $       -

Issuance of common stock
 for cash at $.034 -
   July 9, 1982                      231,300       231       7,594            -
Issuance of common stock
 for cash at $.079 -
   November 12, 1982                 143,650       144      11,199            -
Issuance of common stock
 for cash at $.025
   December 12, 1983                  40,000        40         960            -
Net operating loss for
 the year ended
   December 31, 1983                       -         -           -      (20,168)
Issuance of common stock
 for cash at $.019
   June 6, 1984                       40,000        40         710            -
Net operating loss for
 the year ended
   December 31, 1984                       -         -           -         (750)
Issuance of common stock
 for cash at $.019
   January 15, 1985                   40,000        40         710            -
Net operating loss for
 the year ended
   December 31, 1985                       -         -           -         (750)
Issuance of common stock
 for cash at $.05 -
   May 16, 1997                      200,000       200       9,800            -
Net operating loss for the
 year ended
   December 31, 1997                       -         -           -       (2,290)
Net operating loss for the
 year  ended
   December 31, 1998                       -         -           -       (7,710)
Issuance of common stock for
 cash at $.05 - November 12, 1999    700,000       700      34,300            -
Net operating loss for the year
 ended December 31, 1999                   -         -           -       (7,671)
Issuance of common stock for cash
 at $.10 - June and July 2000      2,500,000     2,500     247,500            -
Issuance of common stock for cash
 at $.10 - July 5, 2000              125,000       125      12,375            -
Net operating loss for the year
 ended December 31, 2000                   -         -           -       (7,497)
Net operating profit for the year
 ended December 31, 2001                   -         -           -       11,247
Net operating profit for the year
 ended December 31, 2002                   -         -           -        3,910


    The accompanying notes are an integral part of these financial statements


                                      -24-
<PAGE>


                                  ORANCO, INC.
            STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY - continued
          Period June 16, 1977 (date of inception) to December 31, 2005

================================================================================

                                       Common Stock      Capital in
                                    ------------------   Excess of   Accumulated
                                    Shares      Amount   Par Value     Deficit
                                    ------      ------   ----------  -----------

Net operating loss for the year
 ended December 31, 2003                   -         -           -     (15,238)
Net operating loss for the year
 ended December 31, 2004                   -         -           -      (7,927)
                                   ---------   -------   ---------   ---------

Balance December 31, 2004          4,019,950     4,020     325,148     (54,844)

Issuance of common stock for cash
 at $.10 - March 2005                250,000       250      24,750           -
Net operating profit for the year
 ended December 31, 2005                   -         -           -      33,398
                                   ---------   -------   ---------   ---------

Balance December 31, 2005          4,269,950   $ 4,270   $ 349,898   $ (21,446)
                                   =========   =======   =========   =========



















    The accompanying notes are an integral part of these financial statements


                                      -25-
<PAGE>


                                  ORANCO, INC.
                           (Development Stage Company)
                             STATEMENT OF CASH FLOWS
             For the Years Ended December 31, 2005, and 2004 and the
          Period June 16, 1977 (Date of Inception) to December 31, 2005

================================================================================


                                                                    Jun 16, 1977
                                             Dec 31,      Dec 31,    to Dec 31,
                                              2005         2004          2005
                                             ---------   ---------  ------------


CASH FLOWS FROM
 OPERATING ACTIVITIES

 Net profit (loss)                           $  33,398   $  (7,927)   $ (21,446)

  Adjustments to reconcile net loss to
  net cash provided by operating activities

   Change in income tax payable                      -        (422)           -
   Changes in accrued interest receivable        4,754      (4,754)           -
   Changes in accounts payable                   1,834         538        2,372


                                             ---------   ---------    ---------

   Net Change in Cash  from Operations          39,986     (12,565)     (19,074)
                                             ---------   ---------    ---------


CASH FLOWS FROM INVESTING
 ACTIVITIES

   Net changes in long term note receivable     65,924     (65,924)           -
                                             ---------   ---------    ---------

CASH FLOWS FROM FINANCING
 ACTIVITIES

   Proceeds from issuance of common stock
    & stock subscriptions                       12,500      12,500      354,168
                                             ---------   ---------    ---------

 Net Change in Cash                            118,410     (65,989)     335,094

 Cash at Beginning of Period                   216,684     282,673            -
                                             ---------   ---------    ---------

 Cash at End of Period                       $ 335,094   $ 216,684    $ 335,094
                                             =========   =========    =========


   The accompanying notes are an integral part of these financial statements.


                                      -26-
<PAGE>



                                  ORANCO, INC.
                           (Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                                December 31, 2005
================================================================================


1. ORGANIZATION

The Company was  incorporated  under the laws of the state of Nevada on June 16,
1977 with  authorized  common stock of 100,000 shares at a par value of $.25. On
June 10, 1997 the authorized  common stock was increased to  100,000,000  shares
with a par value of $.001.

The Company has been in the  business of the  development  of mineral  deposits.
During 1983 all activities were abandoned and the Company has remained  inactive
since that time.

The Company is in the development stage.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Accounting Methods
------------------

The  Company  recognizes  income and  expenses  based on the  accrual  method of
accounting.

Dividend Policy
---------------

The Company has not yet adopted a policy regarding payment of dividends.

Income Taxes
------------

The Company utilizes the liability method of accounting for income taxes.  Under
the liability method deferred tax assets and liabilities are determined based on
the differences  between financial reporting and the tax bases of the assets and
liabilities  and are measured  using the enacted tax rates and laws that will be
in effect,  when the differences are expected to reverse.  An allowance  against
deferred tax assets is recorded,  when it is more likely than not, that such tax
benefits will not be realized.

On  December  31,  2005 the  Company  had a net  operating  loss  available  for
carryforward  of  $21,446.  The tax  benefit of  approximately  $6,500  from the
carryforward has been fully offset by a valuation reserve because the use of the
future tax benefit is doubtful since the Company has not started operations. The
net operating loss will expire starting in 2018 through 2026.

Financial and Concentrations Risk
---------------------------------

The Company does not have any  concentration  or related  financial  credit risk
except that the  Company  maintains  cash in banks over the  insured  amounts of
$100,000, however they are considered to be in banks of high quality.



                                      -27-
<PAGE>


                                 ORANCO, INC.
                           (Development Stage Company)
                    NOTES TO FINANCIAL STATEMENTS (Continued)
                                December 31, 2005
================================================================================

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Basic and Diluted Net Income (Loss) Per Share
---------------------------------------------

Basic net income  (loss) per share  amounts are  computed  based on the weighted
average  number of shares  actually  outstanding.  Diluted net income (loss) per
share amounts are computed  using the weighted  average  number of common shares
and common  equivalent  shares  outstanding  as if shares had been issued on the
exercise of any common share rights unless the exercise becomes antidilutive and
then only the basic per share amounts are shown in the report.

Statement of Cash Flows
-----------------------

For the  purposes of the  statement  of cash flows,  the Company  considers  all
highly  liquid  investments  with a maturity of three  months or less to be cash
equivalents.

Revenue Recognition
-------------------

Revenue  will be  recognized  on the  sale  and  delivery  of a  product  or the
completion of a service provided.

Advertising and Market Development
----------------------------------

The company will expense advertising and market development costs as incurred.

Estimates and Assumptions
-------------------------

Management uses estimates and assumptions in preparing  financial  statements in
accordance with accounting principles generally accepted in the United States of
America.  Those  estimates and  assumptions  affect the reported  amounts of the
assets and liabilities, the disclosure of contingent assets and liabilities, and
the reported revenues and expenses. Actual results could vary from the estimates
that were assumed in preparing these financial statements.

Financial Instruments
---------------------

The carrying amounts of financial instruments are considered by management to be
their estimated fair values due to their short term maturities.



                                      -28-
<PAGE>


                                  ORANCO, INC.
                           (Development Stage Company)
                    NOTES TO FINANCIAL STATEMENTS (Continued)
                                December 31, 2005
================================================================================

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Recent Accounting Pronouncements
--------------------------------

The  Company  does not  expect  that the  adoption  of other  recent  accounting
pronouncements will have a material impact on its financial statements.

3. NOTE RECEIVABLE

The Company made 12% interest loans to Air Packaging  Technologies  Inc. for the
purpose of pursuing a legal action to recover alleged damages.  The terms of the
loan  included a repayment of the loan amounts plus accrued  interest and 60% of
the net recoveries. The note was paid during November 2005 resulting in a profit
of $78,420.

4. COMMON CAPITAL STOCK

On January 11, 2000 the Company  adopted a non  qualified  key man stock  option
plan of 500,000 common shares of its capital stock which can be exercised at the
trading  value on the date of grant.  375,000 of the options  were  exercised on
June 22, 2000 at $.10 per share, and on July 5, 2000 125,000 of the options were
exercised at $.10 per share.  The  remaining  250,000 were  exercised and issued
during March 2005.

5. SIGNIFICANT TRANSACTIONS WITH RELATED PARTIES

Officers-directors have acquired 22% of the outstanding common stock.








                                      -29-

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