UNITED STATES

SECURITIES AND
EXCHANGE COMMISSION

Washington, D.C. 20549







FORM 10-QSB

Quarterly Report Under
Section 13 or 15(d)

of the Securities
Exchange Act of 1934.







|For the quarterly period ended September 30, 2004 | Commission file number 333-72230
|------------------------------------------------- | --------------------------------



ROYAL PHOENIX

(Exact name of small
business issuer as specified in its charter)



|Nevada                                   | 88-0475757         
|---------------------------------------- | -------------------
|(State or other
jurisdiction of          | (I.R.S. Employer   
|incorporation or
organization)           | Identification No.)
|                                        
|2950 E. Flamingo Rd. Suite B-A2         
|Las Vegas, Nevada                        | 89121              
|(Address of principal executive
offices) | (zip code)         



(702) 866-5835

(Issuer's telephone
number)



Check whether the
issuer (1) 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



As of September 30,
2004 there were 28,845,000 shares of common stock outstanding.



Transitional Small Business
Disclosure Format (check one)

Yes      No X

---

ROYAL PHOENIX

(a Development Stage
Company)

BALANCE SHEET



PART I - FINANCIAL
INFORMATION

Item 1. Financial Statements

|                                                                                                                                                  | September 30,
		2004(unaudited)
|------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------
|ASSETS                                                                                                                                            |                                
|                                                                                                                                                  |                                
|CURRENT ASSETS                                                                                                                                    |                                
|Cash                                                                                                                                              | $ 17,351                       
|                                                                                                                                                  |                                
|TOTAL CURRENT ASSETS                                                                                                                              | 17,351                         
|                                                                                                                                                  | $ 17,351                       
|                                                                                                                                                  |                                
|LIABILITIES AND STOCKHOLDERS'
		EQUITY                                                                                                            |                                
|                                                                                                                                                  |                                
|CURRENT LIABILITIES                                                                                                                               |                                
|Notes Payable                                                                                                                                     | $ 0                            
|                                                                                                                                                  |                                
|TOTAL CURRENT LIABILITIES                                                                                                                         | 0                              
|                                                                                                                                                  |                                
|STOCKHOLDERS' EQUITY                                                                                                                              |                                
|                                                                                                                                                  |                                
|Preferred stock, $0.001
			par value authorized 5,000,000; no shares issued and outstanding as
			of 9/30/04                                      | 0                              
|                                                                                                                                                  |                                
|Common stock, $0.001 par
			value, authorized 60,000,000 shares; 28,845,000 shares issued and
			outstanding as of 9/30/04 retroactively restated | 28,845                         
|                                                                                                                                                  |                                
|Additional paid-in capital                                                                                                                        | 18,955                         
|                                                                                                                                                  |                                
|(Deficit) accumulated during
		development stage                                                                                                  | (30,449)                       
|TOTAL STOCKHOLDERS' EQUITY                                                                                                                        | 17,351                         
|                                                                                                                                                  | $ 17,351                       



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

---

ROYAL PHOENIX

(a Development Stage
Company)

STATEMENTS OF
OPERATIONS

UNAUDITED



|                                                                               | Three Months
		Ended September 30, 2004 | Three Months
		Ended  September 30, 2003 | Nine Months
		Ended  September 30, 2004 | Nine Months Ended  September 30, 2003 | For the Period
		October 17, 2000, (Inception) to September 30, 2004
|------------------------------------------------------------------------------ | --------------------------------------- | ---------------------------------------- | --------------------------------------- | ------------------------------------- | --------------------------------------------------------------------
|                                                                               |                                         |                                          |                                         |                                       |                                                                     
|Revenue                                                                        | $ 0                                     | $ 0                                      | $ 0                                     | $ 0                                   | $ 0                                                                 
|                                                                               |                                         |                                          |                                         |                                       |                                                                     
|EXPENSES                                                                       |                                         |                                          |                                         |                                       |                                                                     
|General and Administrative                                                     | 750                                     | 1,500                                    | 6,000                                   | 4,000                                 | 30,449                                                              
|                                                                               |                                         |                                          |                                         |                                       |                                                                     
|TOTAL EXPENSES                                                                 | 750                                     | 1,500                                    | 6,000                                   | 4,000                                 | 30,449                                                              
|                                                                               |                                         |                                          |                                         |                                       |                                                                     
|NET (LOSS)                                                                     | $ (750)                                 | $ (1,500)                                | $ (6,000)                               | $ (4,000)                             | $ (30,449)                                                          
|                                                                               |                                         |                                          |                                         |                                       |                                                                     
|Weighted average number of
		common shares outstanding basic and fully diluted | 28,845,000                              | 28,800,000                               | 28,845,000                              | 28,800,000                            |                                                                     
|                                                                               |                                         |                                          |                                         |                                       |                                                                     
|Net (loss) per weighted
		shares-basic and fully diluted                       | $ (0.00)                                | $ (0.00)                                 | $ (0.00)                                | $ (0.00)                              |                                                                     



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

---



ROYAL PHOENIX

(a Development Stage
Company)

STATEMENTS OF CASH
FLOWS

UNAUDITED



|                                                                   | Nine Months
		Ended
		September 30,
		2004 | Nine Months
		Ended
		September 30,
		2003 | For the Period
		October 17, 2000, (Inception) to September 30, 2004
|------------------------------------------------------------------ | ------------------------------------------ | ------------------------------------------ | --------------------------------------------------------------------
|                                                                   |                                            |                                            |                                                                     
|Cash Flows from                                                    |                                            |                                            |                                                                     
|Operating Activities                                               |                                            |                                            |                                                                     
|Net loss                                                           | $ (6,000)                                  | $ (4,000)                                  | $ (30,449)                                                          
|Shares issued for services                                         | 0                                          | 0                                          | 7,500                                                               
|                                                                   |                                            |                                            |                                                                     
|Adjustment to reconcile
			net loss to net cash used by operations | 0                                          | 0                                          | 0                                                                   
|Note Payable                                                       | 0                                          | 0                                          | 0                                                                   
|                                                                   |                                            |                                            |                                                                     
|Net cash used in operating
		activities                            | (6,000)                                    | (4,000)                                    | (22,949)                                                            
|                                                                   |                                            |                                            |                                                                     
|Cash Flows from Investing
		Activities                             | 0                                          | 0                                          | 0                                                                   
|                                                                   |                                            |                                            |                                                                     
|Cash Flows from Financing
		Activities                             |                                            |                                            |                                                                     
|Converted Note Payable to
		Equity                                 | 0                                          | 1,500                                      | 1,500                                                               
|Issuance of common stock                                           | 0                                          | 25,000                                     | 38,800                                                              
|                                                                   |                                            |                                            |                                                                     
|Net increase in cash                                               | (6,000)                                    | 22,500                                     | 17,351                                                              
|                                                                   |                                            |                                            |                                                                     
|Cash, beginning of period                                          | 23,351                                     | 1,351                                      | 0                                                                   
|Cash, end of period                                                | $ 17,351                                   | $ 23,851                                   | $ 17,351                                                            
|                                                                   |                                            |                                            |                                                                     
|Supplemental Disclosure                                            |                                            |                                            |                                                                     
|Interest Paid                                                      | $ 0                                        | $ 0                                        | $ 0                                                                 
|Taxes Paid                                                         | $ 0                                        | $ 0                                        | $ 0                                                                 



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

---

ROYAL PHOENIX

(A Development Stage
Company)

NOTES TO FINANCIAL
STATEMENTS



Note 1 - Basis of
Presentation



The condensed interim
financial statements included herein, presented in accordance with United States
generally accepted accounting principles and stated in US dollars, have been
prepared by the Company, without audit, pursuant to the rules and regulations of
the Securities and Exchange Commission. Certain information and footnote
disclosures normally included in financial statements prepared in accordance
with generally accepted accounting principles have been condensed or omitted
pursuant to such rules and regulations, although the Company believes that the
disclosures are adequate to make the information presented not misleading.



These statements
reflect all adjustments, consisting of normal recurring adjustments, which in
the opinion of management, are necessary for fair presentation of the
information contained therein. It is suggested that these condensed interim
financial statements be read in conjunction with the financial statements of the
Company for the year ended December 31, 2003 and notes thereto included in the
Company's 10-KSB annual report. The Company follows the same accounting policies
in the preparation of interim reports.



Results of operation
for the interim period are not indicative of annual results.



Note 2 - Going
concern



The accompanying
financial statements have been prepared assuming that the Company will continue
as a going concern which contemplates the recoverability of assets and the
satisfaction of liabilities in the normal course of business. As noted above,
the Company is in the development stage and, accordingly, has not yet generated
revenues from operations. Since its inception, the Company has been engaged
substantially in financing activities and developing its product line, setting
up its e-commerce website, and incurring substantial costs and expenses. As a
result, the Company incurred accumulated net losses from October 17, 2000
(inception) through the period ended June 30, 2004 of $29,699. In addition, the
Company's development activities since inception have been financially sustained
through equity financing.



The ability of the
Company to continue as a going concern is dependent upon its ability to raise
additional capital from the sale of common stock and, ultimately, the
achievement of significant operating revenues. The accompanying financial
statements do not include any adjustments that might be required should the
Company be unable to recover the value of its assets or satisfy its liabilities.



Note 3 - Related
party transactions



The officer and
director of the Company is involved in other business activities and may in the
future, become involved in other business opportunities. If a specific business
opportunity becomes available, such person may face a conflict in selecting
between the Company and its other business interests. The Company has not
formulated a policy for the resolution of such conflicts.

---

ROYAL PHOENIX

(A Development Stage
Company)

NOTES TO FINANCIAL
STATEMENTS



Note 4 -
Stockholders' equity



During the period
ending September 30, 2004, the Company amended its articles of incorporation to
increase it authorized $0.001 par value common stock to 60,000,000 shares.



On September 29,
2004, the Company approved a three for one forward split of its $0.001 par value
common stock with an effective date of October 11, 2004. All reference to the
number of shares issued and outstanding have been retroactively restated to
reflect the forward split.



There have been no
other issuances of common stock during the period ended September 30, 2004.





---



Item 2. Plan of
Operation.



This report contains
forward-looking statements. Actual results and events could differ materially
from those projected, anticipated, or implicit, in the forward-looking
statements as a result of the risk factors set forth below and elsewhere in this
report.



With the exception of
historical matters, the matters discussed herein are forward-looking statements
that involve risks and uncertainties. Forward-looking statements include, but
are not limited to, statements concerning anticipated trends in revenues and net
income, the date of introduction or completion of our products, projections
concerning operations and available cash flow. Our actual results could differ
materially from the results discussed in such forward-looking statements
primarily as the result of insufficient cash to pursue production and marketing
efforts. The following discussion of our financial condition and results of
operations should be read in conjunction with our financial statements and the
related notes thereto appearing elsewhere herein.



Overview



Royal Phoenix, which
was incorporated in Nevada in October 2000, is a Development Stage Company,
engaged in the business of marketing and distributing Royal Phoenix, a line of
herbal products. The Royal Phoenix herbal product line was developed by Desert
Health Products several years ago, however, the product line, after development,
was not marketed.



We have a limited
operating history and have not generated revenues from the sale of any products.
Our company and products are the result of an agreement, which was entered into
between Royal Phoenix and Desert Health Products, which resulted in the
separation from Desert Health Products of the Royal Phoenix line of herbal
products developed by Desert Health Products. Our activities have been limited
to the negotiation of a license agreement and preliminary market analysis,
capital raising and placing the Company in a position of raising additional
capital once the Company's securities are quoted. Consequently, we have incurred
the expenses of start-up. As a result of our lack of liabilities, and limited
operations our current cash position allows us to maintain a status quo position
for a period of approximately nine months. However, this position will not allow
us to pursue any significant business opportunity.



Plan of Operation



Change in Business
Direction



As a result of our
lack of revenue generation and the extremely competitive environment for
nutritional supplements, we have not been satisfied with our business plan or
original plan of operation. In our June 30, 2004 Form 10-QSB we disclosed that
during the next 12 months we planned to re-assess our business plan and
alternatively seek out other business opportunities capable of increasing
stockholder value.

---

We plan to locate and
negotiate with a business entity for the merger of a target business into the
Company. In certain instances, a target business may wish to become a subsidiary
of the Company or may wish to contribute assets to the Company rather than
merge. No assurances can be given that we will be successful in locating or
negotiating with any target business.



Management believes
that there are perceived benefits to being a reporting company with a class of
publicly-traded securities. These are commonly thought to include (1) the
ability to use registered securities to make acquisition of assets or
businesses; (2) increased visibility in the financial community; (3) the
facilitation of borrowing from financial institutions; (4) improved trading
efficiency; (5) stockholder liquidity; (6) greater ease in subsequently raising
capital; (7) compensation of key employees through stock options; (8) enhanced
corporate image; and (9) a presence in the United States capital market.



A business entity, if
any, which may be interested in a business combination with us may include (1) a
company for which a primary purpose of becoming public is the use of its
securities for the acquisition of assets or businesses; (2) a company which is
unable to find an underwriter of its securities or is unable to find an
underwriter of securities on terms acceptable to it; (3) a company which wishes
to become public with less dilution of its common stock than would occur
normally upon an underwriting; (4) a company which believes that it will be able
to obtain investment capital on more favorable terms after it has become public;
(5) a foreign company which may wish to gain an initial entry into the United
States securities market; (6) a special situation company, such as a company
seeking a public market to satisfy redemption requirements under a qualified
Employee Stock Option Plan; or (7) a company seeking one or more of the other
perceived benefits of becoming a public company.



Management is
actively engaged in seeking a qualified company as a candidate for a business
combination. We are authorized to enter into a definitive agreement with a wide
variety of businesses without limitation as to their industry or revenues. It is
not possible at this time to predict with which company, if any, we will enter
into a definitive agreement or what will be the industry, operating history,
revenues, future prospects or other characteristics of that company.



We may seek a
business opportunity with entities which have recently commenced operations, or
which wish to utilize the public marketplace in order to raise additional
capital in order to expand business development activities, to develop a new
product or service, or for other corporate purposes. We may acquire assets and
establish wholly-owned subsidiaries in various businesses or acquire existing
businesses as subsidiaries.



Our management, in
all likelihood will not be experienced in matters relating to the business of a
target business, will rely upon our own efforts in accomplishing our business
purposes. Outside consultants or advisors may be utilized by us to assist in the
search for qualified target companies. If we do retain such an outside
consultant or advisor, any cash fee earned by such person will need to be
assumed by the target business, as we have limited cash assets with which to pay
such obligation.

---



The analysis of new
business opportunities will be undertaken by, or under the supervision of our
officer and director, who is not a professional business analyst. In analyzing
prospective business opportunities, management may consider such matters as:



- the
			available technical, financial and managerial resources;
- working
			capital and other financial requirements; history of operations, if
			any;
- prospects
			for the future;
- nature of
			present and expected competition;
- the
			quality and experience of management services which may be available
			and the depth of that management;
- the
			potential for further research, development, or exploration;
- specific
			risk factors not now foreseeable but which then may be anticipated
			to impact our proposed activities;
- the
			potential for growth or expansion;
- the
			potential for profit;
- the
			perceived public recognition or acceptance of products, services, or
			trades; name identification; and
- other
			relevant factors.

Management does not
have the capacity to conduct as extensive an investigation of a target business
as might be undertaken by a venture capital fund or similar institution. As a
result, management may elect to merge with a target business which has one or
more undiscovered shortcomings and may, if given the choice to select among
target businesses, fail to enter into an agreement with the most
investment-worthy target business.



Following a business
combination we may benefit from the services of others in regard to accounting,
legal services, underwritings and corporate public relations. If requested by a
target business, management may recommend one or more underwriters, financial
advisors, accountants, public relations firms or other consultants to provide
such services.



A potential target
business may have an agreement with a consultant or advisor, providing that
services of the consultant or advisor be continued after any business
combination. Additionally, a target business may be presented to us only on the
condition that the services of a consultant or advisor be continued after a
merger or acquisition. Such preexisting agreements of target businesses for the
continuation of the services of attorneys, accountants, advisors or consultants
could be a factor in the selection of a target business.



In implementing a
structure for a particular business acquisition, we may become a party to a
merger, consolidation, reorganization, joint venture, or licensing agreement
with another corporation or entity. We may also acquire stock or assets of an
existing business. On the consummation of a transaction, it is likely that our
present management and stockholder will no longer be in our control. In
addition, it is likely that our officer and director will, as part of the terms
of the acquisition transaction, resign and be replaced by one or more new
officers and directors.

---



It is anticipated
that any securities issued in any such reorganization would be issued in
reliance upon exemption from registration under applicable federal and state
securities laws. In some circumstances however, as a negotiated element of its
transaction, we may agree to register all or a part of such securities
immediately after the transaction is consummated or at specified times
thereafter. If such registration occurs, of which there can be no assurance, it
will be undertaken by the surviving entity after we have entered into an
agreement for a business combination or have consummated a business combination.
The issuance of additional securities and their potential sale into any trading
market which may develop in our securities may depress the market value of our
securities in the future if such a market develops, of which there is no
assurance.



While the terms of a
business transaction to which we may be a party cannot be predicted, it is
expected that the parties to the business transaction will desire to avoid the
creation of a taxable event and thereby structure the acquisition in a tax-free
reorganization under Sections 351 or 368 of the Internal Revenue Code of 1986,
as amended.



With respect to any
merger or acquisition negotiations with a target business, management expects to
focus on the percentage of the Company which target business stockholders would
acquire in exchange for their shareholdings in the target business. Depending
upon, among other things, the target business's assets and liabilities, our
stockholder swill in all likelihood hold a substantially lesser percentage
ownership interest in the Company following any merger or acquisition. Any
merger or acquisition effected by us may have a significant dilutive effect on
the percentage of shares held by our stockholders at such time.



No assurances can be
given that we will be able to enter into a business combination, as to the terms
of a business combination, or as to the nature of the target business.



As of the date
hereof, management has not made any final decision concerning or entered into
any written agreements for a business combination. When any such agreement is
reached or other material fact occurs, we will file notice of such agreement or
fact with the Securities and Exchange Commission on Form 8-K. Persons reading
this Current Report are advised to determine if we have subsequently filed a
Form 8-K.



We anticipate that
the selection of a business opportunity in which to participate will be complex
and without certainty of success. Management believes (but has not conducted any
research to confirm) that there are numerous firms in various industries seeking
the perceived benefits of a publicly registered corporation. Such perceived
benefits may include facilitating or improving the terms on which additional
equity financing may be sought, providing liquidity for incentive stock options
or similar benefits to key employees, increasing the opportunity to use
securities for acquisitions, and providing liquidity for our stockholders and
other factors. Business opportunities may be available in many different
industries and at various stages of development, all of which will make the task
of comparative investigation and analysis of such business opportunities
extremely difficult and complex. We can provide no assurance that we will be
able to locate compatible business opportunities.

---



Liquidity and Capital Resources



Since inception, we
have financed our cash flow requirements through the issuance of common stock
which has resulted in our receipt of $38,500. As we expand our activities, we
may continue to experience net negative cash flows from operations, pending
receipt of sales revenues. Additionally we anticipate obtaining additional
financing to fund operations through common stock offerings and bank borrowings,
to the extent available, or to obtain additional financing to the extent
necessary to augment our working capital.



Over the next twelve
months we believe that existing capital and anticipated funds from operations
will be sufficient to sustain operations and planned expansion. However, in
order to expand our business operations we will be required to seek additional
capital in the future to fund growth and expansion through additional equity or
debt financing or credit facilities. No assurance can be made that such
financing would be available, and if available it may take either the form of
debt or equity. In either case, the financing could have a negative impact on
our financial condition and our Stockholders.



We anticipate
incurring operating losses over the next twelve months. Our lack of operating
history makes predictions of future operating results difficult to ascertain.
Our prospects must be considered in light of the risks, expenses and
difficulties frequently encountered by companies in their early stage of
development. Such risks include, but are not limited to, an evolving and
unpredictable business model and the management of growth. To address these
risks we must, among other things, obtain a customer base, implement and
successfully execute our business and marketing strategy, continue to develop
and upgrade technology and products, respond to competitive developments, and
attract, retain and motivate qualified personnel. There can be no assurance that
we will be successful in addressing such risks, and the failure to do so can
have a material adverse effect on our business prospects, financial condition
and results of operations.



Off-Balance Sheet Arrangements



We do not have any
off-balance sheet arrangements that have or are reasonably likely to have a
current or future effect on our financial condition, changes in financial
condition, revenues or expenses, results or operations, liquidity, capital
expenditures or capital resources that is material to investors.



FACTORS THAT MAY
AFFECT OUR PLAN OF OPERATION



We are a development
stage company, recently organized and have minimal operating history, which
raises substantial doubt as to our ability to successfully develop profitable
business operations.



We were incorporated
in October of 2000 as a wholly owned subsidiary of Desert Health Products.
Concurrent with formation it was determined to separate Royal Phoenix from
Desert Health Products. As a result of our recent start up, Royal Phoenix has
yet to generate revenues from operations and has been focused on organizational,
start-up, and market analysis activities since we incorporated. Although we have
products to market as a result of our license with Desert Health Products, there
is nothing at this time on which to base an assumption that our business
operations will prove to be successful or that we will ever be able to operate
profitably. In addition, we are actively seeking merger or acquisition
candidates, which is anticipated to drastically change our business operations.

---



We are an
insignificant participant in the business of seeking mergers wherein a large
number of established and well financed entities are our competitors.



We are and will
continue to be an insignificant participant in the business of seeking mergers
with and acquisitions of business entities. A large number of established and
well-financed entities, including venture capital firms, are active in mergers
and acquisitions of companies, which may be merger or acquisition target
candidates for us. Nearly all such entities have significantly greater financial
resources, technical expertise and managerial capabilities than we do and,
consequently, we will be at a competitive disadvantage in identifying possible
business opportunities and successfully completing a business combination.
Moreover, we will also compete with numerous other small public companies in
seeking merger or acquisition candidates.



We have no agreement
for a business combination or other transaction and have no predetermined
standards for a business combination.



We have no current
arrangement, agreement or understanding with respect to engaging in a business
combination with a specific entity. There can be no assurance that we will be
successful in identifying and evaluating suitable business opportunities or in
concluding a business combination. Management has not identified any particular
industry or specific business within an industry for evaluation by us. There is
no assurance that we will be able to negotiate a business combination on terms
favorable to us. We have not established a specific length of operating history
or a specified level of earnings, assets, net worth or other criteria, which we
will require a Target Company to have achieved, or without which we would not
consider a business combination with such business entity. Accordingly, we may
enter into a business combination with a business entity having no significant
operating history, losses, limited or no potential for immediate earnings,
limited assets, negative net worth or other negative characteristics.



A merger with our
company will result in a change in control and management.



A business
combination involving the issuance of our common stock will, in all likelihood,
result in stockholders of a Target Company obtaining a controlling interest in
us. The resulting change in control will likely result in removal of our present
officer and director and a corresponding reduction in or elimination of his
participation in our future affairs.



Because our common
stock is deemed a low-priced "Penny" stock, an investment in our common stock
should be considered high risk and subject to marketability restrictions.



Since our common
stock is a penny stock, as defined in Rule 3a51-1 under the Securities Exchange
Act, it will be more difficult for investors to liquidate their investment even
if and when a market develops for the common stock. Until the trading price of
the common stock rises above $5.00 per share, if ever, trading in the common
stock is subject to the penny stock rules of the Securities Exchange Act
specified in rules 15g-1 through 15g-10. Those rules require broker-dealers,
before effecting transactions in any penny stock, to:

---

- Deliver to the customer, and obtain
				a written receipt for, a disclosure document;
- Disclose certain price information
				about the stock;
- Disclose the amount of compensation
				received by the broker-dealer or any associated person of the
				broker-dealer;
- Send monthly statements to
				customers with market and price information about the penny
				stock; and
- In some circumstances, approve the
				purchaser's account under certain standards and deliver written
				statements to the customer with information specified in the
				rules.

Consequently, the
penny stock rules may restrict the ability or willingness of broker-dealers to
sell the common stock and may affect the ability of holders to sell their common
stock in the secondary market and the price at which such holders can sell any
such securities. These additional procedures could also limit our ability to
raise additional capital in the future.



We will need
additional capital in the future to finance our operations, which we may not be
able to raise or it may only be available on terms unfavorable to us or our
stockholders, which may result in our inability to fund our working capital
requirements and harm our operational results.



We have and expect to
continue to have substantial capital expenditure and working capital needs. We
believe that current cash on hand and the other sources of liquidity are only
sufficient enough to fund our operations through June 30, 2005. After that time
we will need to raise additional funds to fund our operations.



If operating
difficulties or other factors, many of which are beyond our control, cause our
revenues or cash flows from operations, if any, to decrease, we may be limited
in our ability to spend the capital necessary to complete our development,
exploitation and exploration programs. If our resources or cash flows do not
rapidly commence, we will require additional financing to fund our planned
growth.



Additional financing
might not be available on terms favorable to us, or at all. If adequate funds
were not available or were not available on acceptable terms, our ability to
fund our operations, take advantage of unanticipated opportunities, develop or
enhance our business or otherwise respond to competitive pressures would be
significantly limited.

---



If we raise
additional funds through the issuance of equity or convertible debt securities,
the percentage ownership of our stockholders would be reduced, and these newly
issued securities might have rights, preferences or privileges senior to those
of existing stockholders.



Our auditor's report
reflects the fact that without realization of additional capital, it would be
unlikely for us to continue as a going concern.



As a result of our
deficiency in working capital at December 31, 2003 and other factors, our
auditors have included a paragraph in their report regarding substantial doubt
about our ability to continue as a going concern. Our plans in this regard are
to seek merger or acquisition candidates, seek additional funding through future
equity private placements or debt facilities.



Going Concern



The financial
statements included in this filing have been prepared in conformity with
generally accepted accounting principles that contemplate the continuance of the
Company as a going concern. The Company's cash position may be inadequate to pay
all of the costs associated with testing, production and marketing of products.
Management intends to use borrowings and security sales to mitigate the effects
of its cash position, however no assurance can be given that debt or equity
financing, if and when required will be available. The financial statements do
not include any adjustments relating to the recoverability and classification of
recorded assets and classification of liabilities that might be necessary should
the Company be unable to continue existence.



Item 3. Controls and
Procedures



The Company maintains
disclosure controls and procedures designed to ensure that information required
to be disclosed in reports filed under the Securities Exchange Act of 1934, as
amended, is recorded, processed, summarized and reported within the specified
time periods. As of the end of the period covered by this report, the Company's
sole officer evaluated the effectiveness of the Company's disclosure controls
and procedures. Based on the evaluation, which disclosed no significant
deficiencies or material weaknesses, the Company's sole officer concluded that
the Company's disclosure controls and procedures are effective. There were no
changes in the Company's internal control over financial reporting that occurred
during the Company's most recent fiscal quarter that have materially affected,
or are reasonably likely to materially affect, the Company's internal control
over financial reporting.



PART II--OTHER INFORMATION



Other Items



Stock Split and
Increase in Authorized Capital Stock



On September 29,
2004, our Board of Directors approved a three for one forward stock-split of our
issued and outstanding shares of common stock of record on October 11, 2004. The
forward stock-split was effective on October 13, 2004 and increased our number
of shares outstanding from 9,615,000 to 28,845,000.

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In conjunction with
the forward stock-split, we increased our authorized shares of common stock from
20 million shares to 60 million shares, $0.001 par value per share. Pursuant to
NRS 78.209 a meeting of our stockholders was not required to increase the
authorized shares of common stock or approve the forward stock-split.



OTC:BB Symbol Change



On October 13, 2004,
in connection with the stock-split referenced above, the Registrant's OTC:BB
symbol changed to "RYLP".



Item 1. Legal Proceedings.



None.



Item 2. Unregistered Sales of Equity
Securities and Use of Proceeds.



Use of Proceeds From Sales of
Registered Securities



Our Registration
Statement on Form SB- 2 (File No. 333-72230), related to our initial public
offering, was declared effective by the SEC on December 30, 2002. A total of
250,000 shares of our Common Stock was registered with the SEC with an aggregate
offering price of $25,000. All of these shares were registered on our behalf.
The offering commenced in June 2003, and all shares of common stock offered were
sold for the aggregate offering price directly by the Company with no
commissions paid on funds raised.



We incurred offering
expenses of approximately $6,000 in connection with the offering. Thus the net
offering proceeds to us (after deducting offering expenses) were approximately
$19,000. No offering expenses were paid directly or indirectly to any of our
directors or officers (or their associates), persons owning ten percent (10%) or
more of any class of our equity securities or to any other affiliates.



As of September 30,
2004, $4,000 of the net proceeds had been used for legal, accounting and
transfer agent expenses. The remaining $15,000 of the net proceeds are in our
operating account pending future use.



Item 3. Defaults Upon Senior
Securities.



None.



Item 4. Submission of Matter to a
Vote of Security Holders.



None.

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Item 5. Other Information.



None.



Item 6. Exhibits.



Ex-31 - Certification pursuant to
Section 302 of the Sarbanes-Oxley Act

Ex-32 - Certification pursuant to
Section 906 of the Sarbanes-Oxley Act

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SIGNATURES



Pursuant to the
requirements 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.



ROYAL PHOENIX





By:/s/ Jospeh Scott Wilson

Joseph Scott Wilson, President

(On behalf of the registrant and as

principal accounting officer)



Date: November 12, 2004