SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-K

 (Mark One)

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

      For the fiscal year ended: September 30, 2004

[ ]   TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934 For the transition period from:

                          Commission File No. 333-60608

                             JANEL WORLD TRADE, LTD.
                 (Name of small business issuer in its charter)


                 Nevada                                86-1005291
     (State of other jurisdiction of        (IRS Employer Identification No.)
      Incorporation or organization)


           150-14 132nd Avenue, Jamaica, NY             11434
       (Address of principal executive offices)       (Zip Code)


Issuer's telephone number, including area code:     (718) 527-3800


Securities issued pursuant to Section 12(b) of the Act:

                                                   Name of exchange on
           Title of each class                      which registered
           -------------------                      ----------------

                  None                                    None

<PAGE>

Securities registered pursuant to Section 12(g) of the Act:     None

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the  Securities  Exchange Act of 1934 (the
"Act")  during the  preceding  12 months (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days.

Yes X   No
   ---     ---

Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 405
of Regulation  S-K is not contained  herein,  and will not be contained,  to the
best of registrant's  knowledge,  in definitive proxy or information  statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ X ]

Indicate  by check mark  whether  the  registrant  is an  accelerated  filer (as
defined in Rule 12b-2 of the Act). [ ]

State the aggregate market value of the voting and non-voting common equity held
by non-affiliates  computed by reference to the price at which the common equity
was last sold, or the average bid and asked price of such common  equity,  as of
the last business day of the registrant's most recently  completed second fiscal
quarter. $4,121,980 (last sale as of 3/31/04)

                   (APPLICABLE ONLY TO CORPORATE REGISTRANTS)

State the number of shares  outstanding  of each of the issuer's class of common
equity, as of the latest practicable date: 16,843,000

                       DOCUMENTS INCORPORATED BY REFERENCE

List hereunder the following documents if incorporated by reference and the Part
of the Form 10-K into which the document is incorporated:  (1) Any annual report
to  security  holders;  (2) Any  proxy  or  information  statement;  and (3) Any
prospectus  filed  pursuant  to Rule 424(b) or (c) under the  Securities  Act of
1933.

None.


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<PAGE>

                                     PART 1

ITEM 1. DESCRIPTION OF BUSINESS

      GENERAL DEVELOPMENT OF BUSINESS

      Janel World Trade,  Ltd. has its executive offices at 150-14 132nd Avenue,
Jamaica,  NY  11434,  tel.  (718)  527-3800,  adjacent  to the  John F.  Kennedy
International  Airport.  The company and its predecessors  have been in business
since  1974  as a  logistics  services  provider  for  importers  and  exporters
worldwide.  It is primarily engaged,  through its wholly owned subsidiaries,  in
full-service  cargo  transportation  logistics  management,   including  freight
forwarding  - via  air,  ocean  and  land-based  carriers  -  customs  brokerage
services, and warehousing and distribution services.

      In addition to its traditional  freight  forwarding and customs  brokerage
activities,  Janel offers various related,  value-added logistics services, such
as freight consolidation,  insurance, a direct client computer access interface,
logistics  planning,  landed-cost  calculations,   in-house  computer  tracking,
product  repackaging,  online  shipment  tracking and  electronic  billing.  The
value-added  services and systems are intended to help its customers  streamline
operations, reduce inventories,  increase the speed and reliability of worldwide
deliveries  and improve the overall  management and efficiency of the customer's
supply-chain activities.

      Janel  conducts  its  business  through  a  network  of   company-operated
facilities and independent agent relationships in most trading countries. During
fiscal  2004  (Janel's  fiscal year ends  September  30),  the  company  handled
approximately  28,000  individual  import  and export  shipments,  predominately
originating or terminating in the United States,  Europe and the Far East. Janel
generated gross revenue of approximately $69.9 million in 2004, $56.9 million in
2003 and $44.8  million in 2002.  In fiscal 2004,  approximately  65% of revenue
related to import  activities,  10% to export, 20% to break-bulk and forwarding,
and 5% to  warehousing,  distribution  and  trucking.  By market,  the company's
revenue in fiscal 2004 derived from three principal industries: consumer wearing
apparel/textiles - approximately 30-35% (unchanged from 2003);  machines/machine
parts -  approximately  20-25%  (5% less  than  2003);  household  appliances  -
approximately  20% (5% more than 2003);  and sporting  goods and  accessories  -
approximately 5% (unchanged from 2002).

HISTORY

      Janel  commenced  business  in  1974  as  Janel  International  Forwarding
Company,  Inc.,  a  New  York  corporation.  In  1976,  the  "Janel  Group"  was
established  in New York City as a company  primarily  focused on quality import
customs brokerage and related transportation services.  Janel's initial customer
base  consisted  of  importers  and  exporters  of machines  and machine  parts,
principally through what was then West Germany. Shortly thereafter,  the company
began  expanding its business scope into project  transportation  and high-value
general cargo forwarding. In 1979, Janel expanded to the Midwest and West Coast,
opening branches in Chicago and Los Angeles, respectively.  Additional locations
were opened in Atlanta (1995) and Miami (franchise agent) (1997). In 1980, C and
N Corp. was organized as a Delaware  corporation  to be the corporate  parent of
the various Janel Group operating subsidiaries.


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<PAGE>

      In 1990, Janel agreed to the use of its name by a Bangkok, Thailand office
to facilitate  business  operations  during 1990 and 1992 in which it serviced a
United States  cellular  communications  carrier.  In 1997,  Janel  designed and
manufactured (through a subcontractor)  electronic switching equipment shelters,
which it sold to the carrier together with consulting services on transportation
logistics and  coordination  for  construction  of cellular  telephone  sites in
Thailand.

      In 2000, the Janel opened the office in Shanghai,  China,  followed by the
opening  of the  Hong  Kong  office  in 2001 and the  opening  of an  office  in
Shenzhen, China in 2003.

      In June and July 2002, the corporate  parent, C and N Corp.,  entered into
and completed a reverse merger  transaction  with Wine Systems  Design,  Inc. in
which it formally  changed its state of  incorporation  from Delaware to Nevada,
changed  its  corporate  name to Janel  World  Trade,  Ltd.  and became a public
company traded on the Nasdaq Bulletin Board under the symbol "JLWT."

      The company  operates out of five leased  locations in the United  States:
Jamaica, New York  (headquarters);  Lynbrook,  New York (accounting);  Elk Grove
Village (Chicago,  Illinois); Forest Park (Atlanta, Georgia); and Inglewood (Los
Angeles,  California).  Each Janel  office is managed  independently,  with each
manager having over 20 years experience with the company. Janel Shanghai,  Janel
Hong Kong and Janel China (Shenzhen)  operate as independently  owned franchises
within the company's network.  Janel's President,  Stephen P. Cesarski,  and its
Executive Vice  President,  James N. Jannello,  each personally own a 10% profit
interest in each of Janel  Shanghai and Janel Hong Kong.  Janel Miami  (Florida)
and Janel Bangkok  (Thailand)  operate only as franchises  under the Janel name,
but are not otherwise  affiliated  with the  company's  corporate  network.  Mr.
Jannello, Janel's Executive Vice President, owns 50% of the Janel Miami office.

FREIGHT FORWARDING AND RELATED SERVICES

      As a cargo freight forwarder, Janel procures shipments from its customers,
consolidates shipments bound for a particular destination from a common place of
origin,  determines the routing over which the consolidated  shipment will move,
selects  a  carrier  (air,  ocean,  land)  serving  that  route on the  basis of
departure time,  available  cargo capacity and rate, and books the  consolidated
shipment for  transportation  with the  selected  carrier.  In  addition,  Janel
prepares  all  required  shipping  documents,   delivers  the  shipment  to  the
transporting  carrier  and, in many  cases,  arranges  clearance  of the various
components  of the  shipment  through  customs at the final  destination.  If so
requested  by its  customers,  Janel  will  also  arrange  for  delivery  of the
individual  components of the consolidated shipment from the arrival terminal to
their intended consignees.

      As a result of its  consolidation  of customer  shipments  and its ongoing
volume relationships with numerous carriers, a freight forwarder is usually able
to obtain  lower  rates  from such  carriers  than its  customers  could  obtain
directly.  Accordingly,  a forwarder is generally  able to offer its customers a
lower rate than would otherwise be available directly to the customer, providing
the forwarder with its profit opportunity as an intermediary between the carrier
and end-customer.  The forwarder's gross profit is represented by the difference
between the rate it is charged by the carrier and the rate it, in turn,  charges
its customer.

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<PAGE>

      In  fulfilling  its  intermediary  role,  the  forwarder can draw upon the
transportation  assets and capabilities of any individual carrier or combination
thereof comprised of airlines and/or air cargo carriers, ocean shipping carriers
and land-based carriers, such as trucking companies. Janel solicits freight from
its customers to fill containers, charging rates lower than the rates that would
be offered directly to its customers for similar type shipments.

CUSTOMS BROKERAGE SERVICES

      As part of its  integrated  logistics  services,  Janel  provides  customs
brokerage clearance services in the United States and in most foreign countries.
These  services  typically  entail the  preparation  and  assembly  of  required
documentation in many instances (Janel provides  in-house  translation  services
into Chinese,  Spanish or Italian),  the advancement of customs duties on behalf
of importers,  and the  arrangement  for the delivery of goods after the customs
clearance  process is completed.  Additionally,  other  services may be provided
such as the procurement and placement of surety bonds on behalf of importers and
the  arrangement of bonded  warehouse  services,  which allow importers to store
goods while deferring payment of customs duties until the goods are delivered.

      Janel  has over 27  years of  experience  clearing  a wide  range of goods
through U.S.  Customs,  from  automobiles  to heavy  machinery to textiles.  The
company currently has nine fully licensed customs house brokers on staff.  Janel
is fully  certified with U.S.  Customs for both ABI and AES  transmissions.  The
company has established an active  "correspondent  Customs House Broker Network"
of  individuals   specially  chosen  for  their  ability  to  service  customers
throughout  those  locations in the United  States where Janel does not have its
own branch  office.  In addition,  the company  regularly  works with a group of
proven  independent  attorneys,  whose  specialization in  transportation,  U.S.
Customs  law  and   classifications  has  resulted  in  substantial  savings  to
customers.

OTHER LOGISTICS SERVICES

      In  addition to  providing  air,  ocean and land  freight  forwarding  and
customs brokerage services,  Janel provides its import and export customers with
an array of fully integrated global logistics services. These logistics services
include warehousing and distribution  services,  door-to-door freight pickup and
delivery,  cargo consolidation and  de-consolidation,  project cargo management,
insurance,   direct  client  computer  access  interface,   logistics  planning,
landed-cost calculations, duty-drawback (recovery of previously paid duties when
goods  are  re-exported),   in-house  computer  tracking,  product  repackaging,
domestic pickup and forwarding,  "hazmat"  certifications for hazardous cargoes,
letters of credit,  language translation services,  online shipment tracking and
electronic billing.

INFORMATION SYSTEMS

      In May 2000,  Janel upgraded its information  system hardware to an IBM AS
400 system  that is utilized  by all of its  offices in the United  States.  The
company's  information  technology  capabilities  also include DCS/HBU Logistics
software,  a T-1  online  national  network  and a  nationwide  in-house  e-mail
network. These systems enable Janel to perform in-house computer tracking and to
offer  customers  landed-cost   calculations  and  online  Internet  information
availability via the company's  websites relative to the tracking and tracing of
customer shipments.

CUSTOMERS, SALES AND MARKETING

      While  Janel's  customer base  represents a multitude of diverse  industry
groups,  the bulk of the  company's  shipments  are  related to three  principal
markets: consumer wearing apparel and textiles,  machines and machine parts, and
household appliances. During fiscal 2004, the company shipped goods and provided
logistics services for approximately  1,000 individual  accounts.  Janel markets
its global cargo transportation and integrated logistics services worldwide.  In
markets where the company does not operate its own facilities,  its direct sales
efforts are  supplemented by the referral of business through one or more of the
company's franchise or agent  relationships.  The company's six largest accounts
in fiscal 2004 were: The Conair Corporation,  Depa  International,  FAG Bearings
Corporation,  Ralph Lauren  Childrenswear  and Modell's  Sporting  Goods.  Ralph
Lauren  Childrenswear  has since moved out of the New York Metropolitan area and
is not expected to provide significant business in fiscal 2005.


                                       5
<PAGE>

      James N. Jannello and Stephen P. Cesarski are principally  responsible for
the  marketing  of  the  company's  services.  Each  branch  office  manager  is
responsible for sales activities in their U.S. local market area. Janel attempts
to cultivate  strong,  long-term  relationships  with its customers and referral
sources through high-quality service and management.

EMPLOYEES

      As of September 30, 2004, Janel employed 61 people; 30 in its Jamaica, New
York headquarters;  5 in Lynbrook, New York; 8 in Elk Grove Village, Illinois; 5
in Forest Park, Georgia;  and 13 in Inglewood,  California.  Approximately 43 of
the Company's employees are engaged principally in operations, 11 in finance and
administration  and 7 in sales,  marketing and customer service.  Janel is not a
party to any  collective  bargaining  agreement and considers its relations with
its employees to be good.

      To retain the  services of highly  qualified,  experienced  and  motivated
employees,  Janel management  emphasizes an incentive  compensation  program and
adopted a stock option plan in December 2002.

COMPETITION

      Competition   within  the   freight   forwarding   industry   is  intense,
characterized  by low economic  barriers to entry resulting in a large number of
highly fragmented participants around the world. Janel competes for customers on
the basis of its services and capabilities  against other providers ranging from
multinational,  multi-billion dollar firms with hundreds of offices worldwide to
regional and local freight forwarders to "mom-and-pop"  businesses with only one
or a few customers.

CURRENCY RISKS

      The nature of Janel's operations requires it to deal with currencies other
than the U.S. Dollar.  This results in the company being exposed to the inherent
risks of international currency markets and governmental interference.  A number
of countries where Janel maintains offices or agent  relationships have currency
control  regulations  that  influence  its  ability  to hedge  foreign  currency
exposure.  The company tries to compensate for these  exposures by  accelerating
international currency settlements among those offices or agents.

SEASONALITY

      Historically,  Janel's  quarterly  operating  results have been subject to
seasonal trends. The fiscal first quarter has traditionally been the weakest and
the fiscal third and fourth quarters have traditionally been the strongest. This
pattern has been the result of, or influenced  by,  numerous  factors  including
climate,  national  holidays,  consumer  demand,  economic  conditions and other
similar and subtle forces. This historical  seasonality has also been influenced
by the growth and diversification of Janel's  international  network and service
offerings. The company cannot accurately forecast many of these factors, nor can
it estimate the relative impact of any particular factor and, as a result, there
is no assurance that historical patterns will continue in the future.

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<PAGE>

      A significant  portion of Janel's  revenues are derived from  customers in
industries  with  shipping  patterns  closely  tied to consumer  demand and from
customers  with  shipping  patterns   dependent  upon  just-in-time   production
schedules.  Therefore,  the timing of Janel's  revenues  are, to a large degree,
affected by factors  beyond the  company's  control,  such as shifting  consumer
demand for retail goods and  manufacturing  production  delays.  Many of Janel's
customers may ship a significant  portion of their goods at or near the end of a
quarter and the company may not learn of a resulting  shortfall in revenue until
late in a quarter.

ENVIRONMENTAL ISSUES

      In the  United  States,  Janel is  subject  to  federal,  state  and local
provisions  regulating  the  discharge  of  materials  into the  environment  or
otherwise  for the  protection  of the  environment.  Similar laws apply in many
foreign jurisdictions in which Janel operates.  Although current operations have
not been  significantly  affected by compliance with these  environmental  laws,
governments are becoming increasingly  sensitive to environmental issues and the
company cannot predict what impact future environmental  regulations may have on
its business. Janel does not anticipate making any material capital expenditures
for  environmental  control  purposes  during the  remainder  of the  current or
succeeding fiscal years.

REGULATION

      With respect to Janel's activities in the air  transportation  industry in
the  United   States,   it  is  subject  to  regulation  by  the  Department  of
Transportation  as an indirect air carrier.  The company's  overseas offices and
agents are  licensed as freight  forwarders  in their  respective  countries  of
operation.  Janel is licensed in each of its offices as a freight  forwarder  by
the International Air Transport Association.  IATA is a voluntary association of
airlines which prescribes  certain operating  procedures for freight  forwarders
acting  as  agents  of  its  members.  The  majority  of the  company's  freight
forwarding businesses is conducted with airlines that are IATA members.

      Janel is  licensed  as a customs  broker  by the  Customs  Service  of the
Department of Treasury in each U.S.  Customs district in which it does business.
All U.S.  Customs  Brokers are required to maintain  prescribed  records and are
subject to periodic audits by the Customs  Service.  In other  jurisdictions  in
which Janel  performs  clearance  services,  it is  licensed by the  appropriate
governmental authority.

      Janel is registered as an Ocean  Transportation  Intermediary and licensed
as a NVOCC carrier (non-vessel operating common carrier) by the Federal Maritime
Commission.  The FMC has established certain qualifications for shipping agents,
including certain surety bonding requirements.

      Janel  does  not  believe  that  current  U.S.  and  foreign  governmental
regulations impose significant economic restraint on its business operations.

CARGO LIABILITY

      When  acting as an  airfreight  consolidator,  Janel  assumes a  carrier's
liability  for lost or damaged  shipments.  This legal  liability  is  typically
limited by contract to the lower of the transaction  value or the released value
($9.07  per  pound  unless  the  customer  declares  a higher  value  and pays a
surcharge),  excepted for loss or damages  caused by willful  misconduct  in the
absence of an appropriate  airway bill. The airline that the company utilizes to
make the actual shipment is generally  liable to Janel in the same manner and to
the same extent. When acting solely as the agent of an airline or shipper, Janel
does not  assume  any  contractual  liability  for loss or damage  to  shipments
tendered to the airline.

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<PAGE>

      When acting as an ocean  freight  consolidator,  Janel assumes a carrier's
liability for lost or damaged  shipments.  This liability is strictly limited by
contract to the lower of a  transaction  value or the  released  value ($500 for
package or customary  freight  unit unless the customer  declares a higher value
and pays a  surcharge).  The  steamship  line which  Janel  utilizes to make the
actual shipment is generally liable to the company in the same manner and to the
same extent. In its ocean freight  forwarding and customs clearance  operations,
Janel does not assume cargo liability.

      When providing warehouse and distribution services, Janel limits its legal
liability by contract to an amount generally equal to the lower of fair value or
$.50 per pound  with a maximum of $50 per "lot,"  defined as the  smallest  unit
that the  warehouse  is  required  to track.  Upon  payment of a  surcharge  for
warehouse and distribution services, Janel would assume additional liability.

      The company  maintains  marine cargo insurance  covering claims for losses
attributable  to missing or damaged  shipments  for which it is legally  liable.
Janel also  maintains  insurance  coverage for the property of others  stored in
company warehouse facilities.

RISK FACTORS

1.    WE  MAY  NOT  BE  SUCCESSFUL  IN  GROWING  EITHER  INTERNALLY  OR  THROUGH
      ACQUISITIONS.

      Our growth strategy  primarily  focuses on internal growth in domestic and
international freight forwarding,  local pick up and delivery, customs brokerage
and  acquisitions.  Our  ability  to grow will  depend  on a number of  factors,
including:

      -     existing and emerging competition;

      -     ability to operate profitably in the face of competitive pressures;

      -     the recruitment,  training and retention of operating and management
            employees;

      -     the strength of demand for our services;

      -     the availability of capital to support our growth; and

      -     the ability to identify, negotiate and fund acquisitions when
            appropriate.

2.    ACQUISITIONS INVOLVE RISKS, INCLUDING THOSE RELATING TO:

      -     the  integration  of  acquired   businesses,   including   different
            information systems;

      -     the retention of prior levels of business;

      -     the retention of employees;

      -     the diversion of management attention;

      -     the  write-offs  resulting  from  impairment of acquired  intangible
            assets; and

      -     unexpected liabilities.


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<PAGE>

      We cannot  assure that we will be successful  in  implementing  any of our
business strategies or plans for future growth.

3.    EVENTS  AFFECTING  THE  VOLUME OF  INTERNATIONAL  TRADE AND  INTERNATIONAL
      OPERATIONS COULD ADVERSELY AFFECT OUR INTERNATIONAL OPERATIONS.

      Our international  operations are directly related to and dependent on the
volume of international trade,  particularly trade between the United States and
foreign  nations.  This  trade,  as well as our  international  operations,  are
influenced by many factors, including:

      -     economic and political conditions in the United States and abroad;

      -     major work stoppages, such as the 2002 West Coast work stoppage;

      -     exchange controls, currency conversion and fluctuations;

      -     war, other armed conflicts and terrorism; and

      -     United   States  and  foreign  laws   relating  to  tariffs,   trade
            restrictions, foreign investment and taxation.

      Trade-related  events  beyond  our  control,  such as a failure of various
nations to reach or adopt  international  trade  agreements  or an  increase  in
bilateral or  multilateral  trade  restrictions,  could have a material  adverse
effect  on our  international  operations.  Our  operations  also  depend on the
availability of independent  carriers that provide cargo space for international
operations.

4.    OUR  BUSINESS  HAS BEEN AND COULD  CONTINUE  TO BE  ADVERSELY  AFFECTED BY
      NEGATIVE  CONDITIONS IN THE UNITED STATES ECONOMY OR THE INDUSTRIES OF OUR
      PRINCIPAL CUSTOMERS.

      Demand for our services had been adversely affected by negative conditions
in the United States economy or the  industries of our customers.  A substantial
number of our  principal  customers  are in the  household  products,  garments,
industrial  equipment,  telecommunications  and  related  industries,  and their
business had been adversely affected,  particularly during the 2001-2002 period.
These  customers  collectively  account  for a  substantial  percentage  of  our
revenue.  Adverse  conditions or worsening  conditions in the  industries of our
customers could cause us to lose a significant customer or experience a decrease
in the shipment  volume and business  levels of our  customers.  Either of these
events  could  negatively  affect  our  financial   results.   Adverse  economic
conditions  outside  the United  States  can also have an adverse  effect on our
customers  and our  business.  We  expect  that  demand  for our  services,  and
consequently our results of operations, will be sensitive to domestic and global
economic conditions and other factors beyond our control.

5.    THE  TERRORIST  ATTACKS ON  SEPTEMBER  11, 2001,  HAVE  CREATED  ECONOMIC,
      POLITICAL AND REGULATORY UNCERTAINTIES,  SOME OF WHICH MAY MATERIALLY HARM
      OUR  BUSINESS  AND  PROSPECTS  AND OUR ABILITY TO CONDUCT  BUSINESS IN THE
      ORDINARY COURSE.

      The  terrorist  attacks that took place in the United  States on September
11, 2001, have adversely affected many businesses,  including our business.  The
national and global responses to these terrorist  attacks,  which are varied and
unpredictable,  may materially  adversely  affect us in ways we cannot currently
predict.  Some of the possible future effects include reduced business  activity
by our customers,  increased  shipping  costs,  changes in security  measures or
regulatory  requirements  for air and other travel and  reductions  in available
commercial  flights  that may make it more  difficult  for us to arrange for the
transport of our customers'  freight and increased  credit and business risk for
customers in industries that were severely affected by the attacks.


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<PAGE>

6.    OUR ABILITY TO SERVE OUR CUSTOMERS  DEPENDS ON THE  AVAILABILITY  OF CARGO
      SPACE FROM THIRD PARTIES.

      Our ability to serve our customers  depends on the availability of air and
sea cargo  space,  including  space on  passenger  and cargo  airlines and ocean
carriers that service the  transportation  lanes that we use. Shortages of cargo
space  are most  likely to  develop  around  holidays  and in  especially  heavy
transportation  lanes. In addition,  available cargo space could be reduced as a
result of  decreases  in the  number of  passenger  airlines  or ocean  carriers
serving  particular  shipment lanes at particular  times.  This could occur as a
result of economic conditions,  transportation  strikes,  regulatory changes and
other  factors  beyond  our  control.  Our  future  operating  results  could be
adversely  affected  by  significant  shortages  of  suitable  cargo  space  and
associated  increases in rates charged by passenger  airlines or ocean  carriers
for cargo space.

7.    WE MAY LOSE BUSINESS TO COMPETITORS.

      Competition  within the freight  industry is intense.  We compete in North
America  primarily  with fully  integrated  carriers,  including much larger and
well-financed    national    companies   and   smaller    freight    forwarders.
Internationally,  we compete  primarily  with the major  European-based  freight
forwarders.  We expect to encounter continued  competition from those forwarders
that have a predominantly international focus and have established international
networks,  including those based in the United States and Europe. We also expect
to continue to  encounter  competition  from other  forwarders  with  nationwide
networks,  regional  and local  forwarders,  passenger  and cargo air  carriers,
trucking   companies,   cargo  sales  agents  and  brokers,   and  carriers  and
associations  of  shippers  organized  for the  purpose of  consolidating  their
members'  shipments to obtain lower  freight rates from  carriers.  As a customs
broker and ocean freight  forwarder,  we encounter  strong  competition in every
port in which we do business,  often  competing  with large domestic and foreign
firms as well as local and regional firms. Our inability to compete successfully
in our  industry  could  cause us to lose  customers  or lower the volume of our
shipments.

8.    OUR SUCCESS  DEPENDS ON THE EFFORTS OF OUR FOUNDER AND OTHER KEY  MANAGERS
      AND PERSONNEL.

      Our founder,  James N.  Jannello,  continues  to serve as  Executive  Vice
President and Chief  Executive  Officer,  and Stephen P.  Cesarski  continues to
serve as President and Chief Operating  Officer.  We believe that our success is
highly  dependent  on the  continuing  efforts  of Mr.  Jannello  and the  other
executive  officers  and key  employees,  as well as our  ability to attract and
retain  other  skilled  managers  and  personnel.  None of our  officers  or key
employees are subject to employment  contracts.  The loss of the services of any
of our key personnel could have a material adverse effect on us.

9.    JANEL'S OFFICERS AND DIRECTORS CONTROL THE COMPANY.

      The   officers  and   directors  of  the  company   control  the  vote  of
approximately 72% of the outstanding shares of common stock. The company's stock
option plan provides  1,600,000  shares of common stock  regarding which options
may be granted to key  employees of the company.  As a result,  the officers and
directors of the company  control the election of the  company's  directors  and
will have the ability to control the affairs of the company.  Furthermore,  they
will, by virtue of their control of a large majority of the voting shares,  have
controlling  influence  over,  among  other  things,  the  ability  to amend the
company's  Certificate  of  Incorporation  and  By-Laws  or effect  or  preclude
fundamental  corporate  transactions   involving  the  company,   including  the
acceptance or rejection of any proposals  relating to a merger of the company or
an acquisition of the company by another entity.


                                       10
<PAGE>

10.   FAILURE TO COMPLY  WITH  GOVERNMENTAL  PERMIT AND  LICENSING  REQUIREMENTS
      COULD RESULT IN FINES OR  REVOCATION  OF OUR  OPERATING  AUTHORITIES,  AND
      CHANGES IN THESE REQUIREMENTS COULD ADVERSELY AFFECT US.

      Our operations are subject to various  state,  local,  federal and foreign
regulations that in many instances require permits and licenses.  Our failure to
maintain required permits or licenses, or to comply with applicable regulations,
could result in  substantial  fines or revocation of our operating  authorities.
Moreover,  government  deregulation efforts,  "modernization" of the regulations
governing customs  clearance and changes in the  international  trade and tariff
environment  could require material  expenditures or otherwise  adversely affect
us.

11.   OUR STOCK PRICE IS SUBJECT TO VOLATILITY.

      Our common stock trades on the OTC Bulletin Board under the symbol "JLWT."
The  market  price  of  our  common  stock  has  been  subject  to   significant
fluctuations.  Such fluctuations,  as well as economic conditions generally, may
adversely affect the market price of our securities.

12.   WE HAVE NO ASSURANCE OF A CONTINUED PUBLIC TRADING MARKET.

      Janel's common stock is quoted in the  over-the-counter  market on the OTC
Bulletin  Board and is subject to the  low-priced  security or so-called  "penny
stock"   rules  that  impose   additional   sales   practice   requirements   on
broker-dealers who sell such securities.  For any transaction  involving a penny
stock,  the rules  require,  among  other  things,  the  delivery,  prior to the
transaction,  of a disclosure schedule required by the SEC relating to the penny
stock market.  The 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  customer's  account.  As a
result,  characterization  as a "penny  stock" can  adversely  affect the market
liquidity for the securities.

13.   WE HAVE NO HISTORY OF PAYING DIVIDENDS.

      Janel  has not paid cash  dividends  on our  common  stock.  We  currently
anticipate  that we will retain all future  earnings for use in our business and
do not anticipate paying any cash dividends in the foreseeable future.

ITEM 2. PROPERTIES

      Janel  leases  all of its  office  facilities.  The  executive  offices in
Jamaica,  New York  consist of  approximately  5,000 square feet of office space
adjoined by 9,000 square feet of warehouse  space, all subject to a lease with a
term ending  January  31,  2010,  and an annual  base rent of  $132,300  through
January  31,  2005,  and  $145,500  thereafter.  Its  administrative  office  in
Lynbrook,  New York is  approximately  1,318 square feet and is occupied under a
lease which expires  February 28, 2008, with an annual rent of $35,000 for 2004,
which  increases  to  $38,000 in the last year of the  lease.  Janel's  Illinois
office  occupies  approximately  2,063 square feet with an additional 800 square
feet of  warehouse  space under a lease which  expires  June 30,  2005,  with an
annual rent of $30,000.  Janel's Georgia location occupies  approximately  3,000
square feet of office and warehouse space, under a lease which expires in August
31,  2006 with an annual rent of $29,000.  Janel's Los Angeles  office  occupies
approximately  3,000 square feet of office  under a lease which  expires in June
2007 with an annual  rent of  $61,380.  Certain of the leases  also  provide for
annual increases based upon increases in taxes or service charges.


                                       11
<PAGE>

ITEM 3. LEGAL PROCEEDINGS

      Janel is occasionally subject to claims and lawsuits which typically arise
in the normal  course of business.  While the outcome of these claims  cannot be
predicted with certainty, management does not believe that the outcome of any of
these  legal  matters  will have a  material  adverse  effect  on the  company's
financial position or results of operations.

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

      There was no  submission of matters to a vote of security  holders  during
the company's fiscal year ended September 30, 2004.

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

      The  company's  common  stock is quoted  on the OTC  Bulletin  Board.  The
following  table  sets  forth the range of the high and low bid  prices  for the
company's  common  stock as reported on the OTC  Bulletin  Board for the periods
indicated.  Quotations do not necessarily  represent actual  transactions and do
not reflect related mark-ups, mark-downs or commissions:

Fiscal 2004                 High Bid       Low Bid
-----------                 --------       -------
First Quarter                 $1.33          $.67

Second Quarter                $1.55          $.81

Third Quarter                 $1.40          $.65

Fourth Quarter                $ .94          $.37



Fiscal 2003                 High Bid       Low Bid
-----------                 --------       -------
First Quarter                 $.67           $.24

Second Quarter                $.35           $.21

Third Quarter                 $.67           $.26

Fourth Quarter                $.85           $.52

      At  December  15,  2004,   the  company  had  57  holders  of  record  and
approximately 590 beneficial  holders of its shares of common stock. On December
27,  2004,  the last sale price of the shares of common stock as reported by the
OTC Bulletin Board was $.46 per share.

      Securities  which were  issued or sold by the  Registrant  within the past
three years and which were not registered  under the Securities Act of 1933 (the
"Securities Act"), are as follows:

      On July 22,  2002,  Janel's  Board of  Directors  authorized  the sale and
issuance of up to  1,803,000  shares of  restricted  common stock for a purchase
price of $.01 per share to a list of 43  employees  and five  consultants  as an
incentive for  performance.  A total of 1,801,000  shares were  purchased for an
aggregate  cash  consideration  of  $18,010,  all of which  was  applied  to the
company's general working capital.


                                       12
<PAGE>

      On October 28, 2002,  Janel's Board of Directors approved an agreement for
the sale and  issuance  of  42,000  shares  of  restricted  common  stock to the
company's  attorneys in consideration  for a reduction of $15,609 of outstanding
legal fees and costs,  which was  satisfied  by the issuance and delivery of the
shares.

      Exemption  from  registration  under the Securities Act is claimed for the
sales of common stock referred to above in reliance upon the exemption  afforded
by Section 4(2) of the  Securities Act for  transactions  not involving a public
offering.  Each  certificate  evidencing  such  shares of common  stock bears an
appropriate restrictive legend, and "stop transfer" orders are maintained on the
company's  stock  transfer  records  with respect to each of the holders of that
common stock.  None of the sales involved  participation  by an underwriter or a
broker-dealer.

ITEM 6. SELECTED FINANCIAL DATA

<TABLE>
<CAPTION>
                                                     YEAR ENDED SEPTEMBER 30,

                                        2004            2003           2002            2001            2000
                                     ------------   ------------   ------------    ------------   ------------
<S>                                   <C>            <C>            <C>             <C>            <C>
Freight Forwarding Revenue            $69,981,639    $56,916,276    $44,848,442     $46,650,094    $53,160,777
                                     ------------   ------------   ------------    ------------   ------------
Net Income (Loss)                        $264,355       $196,787      $(118,783)        $38,966      $(130,647)
                                     ------------   ------------   ------------    ------------   ------------
Net Income (Loss) per common share        $0.0157        $0.0117       $(0.0077)            N/A            N/A
                                     ------------   ------------   ------------    ------------   ------------
Total Assets                           $7,030,489     $5,798,260     $4,726,296      $4,732,370     $5,038,883
                                     ------------   ------------   ------------    ------------   ------------
Long-Term Obligations                    $100,530        $78,568        $78,568        $153,619       $212,343
                                     ------------   ------------   ------------    ------------   ------------

Cash Dividends Declared
  per common share                                           N/A            N/A             N/A            N/A
                                                    ------------   ------------    ------------   ------------

</TABLE>


                                       13
<PAGE>


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

FORWARD-LOOKING STATEMENTS

      The  statements  contained  in all  parts  of this  document  that are not
historical  facts  are,  or may be  deemed to be,  "forward-looking  statements"
within the meaning of Section 27A of the  Securities Act of 1933 and Section 21E
of the Securities Exchange Act of 1934. Such forward-looking statements include,
but are not limited to, those relating to the following: the effect and benefits
of the  company's  reverse  merger  transaction;  Janel's  plans to reduce costs
(including the scope, timing, impact and effects thereof);  potential annualized
cost   savings;   plans  for  direct  entry  into  the  trucking  and  warehouse
distribution business (including the scope, timing, impact and effects thereof);
the  company's  ability  to  improve  its  cost  structure;  plans  for  opening
additional  domestic and foreign  branch offices  (including the scope,  timing,
impact  and  effects  thereof);  the  sensitivity  of demand  for the  company's
services to domestic and global  economic  and  political  conditions;  expected
growth;  future  operating  expenses;  future margins;  fluctuations in currency
valuations; fluctuations in interest rates; future acquisitions and any effects,
benefits,  results,  terms or other  aspects  of such  acquisitions;  ability to
continue  growth and  implement  growth and  business  strategy;  the ability of
expected sources of liquidity to support working capital and capital expenditure
requirements; future expectations and outlook and any other statements regarding
future growth, cash needs, operations,  business plans and financial results and
any other statements that are not historical facts.


                                       14
<PAGE>

      When used in this document, the words "anticipate,"  "estimate," "expect,"
"may," "plans,"  "project," and similar expressions are intended to be among the
statements that identify forward-looking statements.  Janel's results may differ
significantly from the results discussed in the forward-looking statements. Such
statements involve risks and uncertainties, including, but not limited to, those
relating to costs, delays and difficulties  related to the company's  dependence
on its ability to attract and retain skilled managers and other  personnel;  the
intense  competition  within  the  freight  industry;  the  uncertainty  of  the
company's  ability to manage and continue its growth and  implement its business
strategy;  the company's  dependence on the availability of cargo space to serve
its customers;  effects of regulation;  its  vulnerability  to general  economic
conditions and dependence on its principal customers; accuracy of accounting and
other   estimates;   risk  of  international   operations;   risks  relating  to
acquisitions;  the company's future financial and operating results,  cash needs
and demand for its services;  and the  company's  ability to maintain and comply
with  permits and  licenses;  as well as other risk  factors  described  in this
Annual Report.  Should one or more of these risks or uncertainties  materialize,
or should  underlying  assumptions  prove  incorrect,  actual  outcomes may vary
materially from those projected.

      OVERVIEW

      Janel  operates its business as a single  segment  primarily  comprised of
full-service  cargo  transportation  logistics  management,   including  freight
forwarding via air, ocean and land-based  carriers,  customs brokerage services,
warehousing and distribution services, and other value-added logistics services.

      The following  discussion and analysis addresses the results of operations
for the fiscal  year ended  September  30,  2004,  as compared to the results of
operations  for the fiscal year ended  September 30, 2003; the fiscal year ended
September 30, 2003 as compared to the results of operations  for the fiscal year
ended  September  30, 2002;  and the results of  operations  for the fiscal year
ended  September  30,  2002,  as compared to the results of  operations  for the
fiscal year ended September 30, 2001. The discussion and analysis then addresses
the liquidity and financial condition of the company, and other matters.

RESULTS OF OPERATIONS - FISCAL YEAR ENDED  SEPTEMBER 30, 2004 COMPARED TO FISCAL
YEAR ENDED SEPTEMBER 30, 2003

      REVENUE.

      Total  forwarding  revenue  for fiscal 2004 was a record  $69,981,639,  as
compared  to  $56,916,276  for  fiscal  2003,  a   year-over-year   increase  of
$13,065,363,  or 23.0%. The increase in revenue was primarily due to the general
improvement  in  international  trade during fiscal 2004 in all of the principal
industry  sectors  served by the company,  in  particular,  wearing  apparel and
finished  garments,  household  electronics and sporting goods and  accessories.
During fiscal 2004,  the company  substantially  increased its overall  business
activities with existing clients as well as through the addition of new clients.
Net revenue (forwarding revenue minus forwarding  expenses) in fiscal 2004 was a
record $6,940,462,  an increase of $624,485,  or 9.9%, as compared to $6,315,977
in fiscal 2003.

                                       15
<PAGE>


         FORWARDING EXPENSE.

      Forwarding  expense  is  primarily  comprised  of the  fees  paid by Janel
directly to cargo carriers to handle and transport its actual freight  shipments
on behalf of its customers between initial and final terminal points. Forwarding
expense  also  includes  any  duties  and/or  trucking  charges  related  to the
shipments. For fiscal year 2004, forwarding expense increased by $12,440,878, or
24.6%,  to  $63,041,177  as  compared  to  $50,600,299  for  fiscal  year  2003.
Forwarding expense increased year-over-year at a slightly higher percentage than
forwarding revenue because,  in fiscal 2004, a somewhat higher proportion of the
company's  total shipments  utilized ocean freight,  for which the company earns
slightly lower margins than for air freight.

      SELLING, GENERAL AND ADMINISTRATIVE EXPENSE.

      Selling,  general and administrative  expense increased $367,015, or 6.2%,
to $6,323,606 in fiscal 2004, as compared to $5,956,591 in fiscal 2003. However,
as a  percentage  of  revenue,  SG&A  expense  in  fiscal  2004  was  9.03%,  an
improvement of 143 basis points as compared to 10.46% as a percentage of revenue
in fiscal 2003.

      INCOME FROM OPERATIONS.

      Janel's  income  from  operations  rose  $236,917,  or 70.4%,  to a record
$573,479 in fiscal 2004 as compared to $336,562 in fiscal 2003.  The  relatively
greater  percentage  increase in operating income as compared to  year-over-year
revenue generally reflects the positive leverage effect derived from the largely
fixed  nature  of  SG&A  expense.  The  operating  income  margin  (income  from
operations  divided by net  revenue)  improved  by 293 basis  points to 8.26% in
fiscal 2004 from 5.33% in fiscal 2003.

      INCOME (LOSS) BEFORE INCOME TAXES.

      Income before taxes in fiscal 2004 was a record  $468,955,  which was less
than income from  operations  for the period,  primarily as a result a charge of
$119,160  taken  in the  fiscal  fourth  quarter  reflecting  costs  related  to
abandoned business  acquisitions.  Nonetheless,  this represented a year-to-year
improvement  of  $112,668.,  or 31.6%,  as  compared to income  before  taxes of
$356,287 in fiscal 2003.

      INCOME TAXES.

      The effective income tax rate in both fiscal 2004 and fiscal 2003 reflects
the U.S. federal statutory rate and applicable state income taxes.

      NET INCOME (LOSS).

      For fiscal 2004, Janel reported record net income of $264,355, an increase
of $67,568,  or 34.3%,  as compared  to the  reported  net income of $196,787 in
fiscal 2003.  Janel's net profit margin (net income as a percent of net revenue)
was 3.81% in fiscal 2004, an improvement of 69 basis points as compared to 3.12%
in fiscal 2003.

                                       16
<PAGE>

RESULTS OF OPERATIONS - FISCAL YEAR ENDED  SEPTEMBER 30, 2003 COMPARED TO FISCAL
YEAR ENDED SEPTEMBER 30, 2002

         REVENUE.

      Total  forwarding  revenue for fiscal 2003 was  $56,916,276 as compared to
$44,848,442 for fiscal 2002, a year-over-year decrease of $12,067,834, or 26.9%.
The increased  level of revenue was primarily due to the general  improvement in
international  trade during fiscal 2003 in all of the principal industry sectors
served by the company,  in particular,  wearing  apparel and finished  garments,
household electronics and sporting goods and accessories.

      FORWARDING EXPENSE.

      Forwarding  expense  is  primarily  comprised  of the  fees  paid by Janel
directly to cargo carriers to handle and transport its actual freight  shipments
on behalf of its customers between initial and final terminal points. Forwarding
expense  also  includes  any  duties  and/or  trucking  charges  related  to the
shipments. For fiscal year 2003, forwarding expense increased by $11,575,182, or
29.7%,  to  $50,600,299  as compared to  $39,025,117  for fiscal year 2002.  The
increase was generally  consistent  with the higher level of forwarding  revenue
year-over-year.

      SELLING, GENERAL AND ADMINISTRATIVE EXPENSE.

      Selling,  general and administrative  expense increased $385,007, or 6.9%,
to  $5,956,591  in fiscal 2003 as compared to  $5,571,584  in fiscal 2002.  As a
percentage  of revenue,  SG&A  expense in fiscal 2003 at 10.46%  improved by 196
basis points as compared to 12.42% in the prior year.

      INCOME FROM OPERATIONS.

      Primarily as a result of the proportionately lesser percentage increase in
SG&A expenses  relative to the percentage  increase in revenue in fiscal 2003 as
compared to fiscal 2002, Janel's income from operations rose $105,880, or 45.9%,
to $336,562 in fiscal 2003 as compared to $230,682 in fiscal 2002. The operating
income  margin  (i.e.,  based on income  before  taxes  and other  items) on net
revenue (total  forwarding  revenue less forwarding  expenses)  increased by 137
basis points from 3.96% in fiscal 2002 to 5.33% in fiscal 2003.

      IMPAIRMENT LOSS.

      In the  fourth  quarter  of fiscal  2002,  Janel  booked a  non-recurring,
non-cash  charge of $250,000 for an  impairment  loss  related to the  company's
reverse merger transaction with Wine Systems Design, Inc. ("WSD"),  completed on
July 26,  2002,  and through  which Janel World  Trade,  Ltd.  became a publicly
traded company.  Under the terms of the  transaction,  4,000,000 shares of Janel
common stock were assigned a value of $250,000  representing  the estimated fair
value of the WSD public shell.  This amount,  which  represented the cost of the
acquisition  over the fair  value of net  assets  acquired,  was  attributed  to
goodwill.  The goodwill was subsequently reviewed for impairment and was written
off.


                                       17
<PAGE>

      INCOME (LOSS) BEFORE INCOME TAXES.

      Primarily as a result of the  nonrecurring  charge for impairment  loss of
$250,000,  the company reported a loss before income taxes of $(9,283) in fiscal
2002 as  compared to income  before  income  taxes of  $356,287 in fiscal  2003.
Excluding  the effect of the  impairment  loss,  Janel's  income before taxes in
fiscal 2002 would have been $240,717,  yielding an increase of $115,570 or 48.1%
for fiscal 2003 as compared to fiscal 2002 on that basis.

      INCOME TAXES.

      The  effective  income  tax rate in both the fiscal  2003 and fiscal  2002
years  reflects the U.S.  federal  statutory  rate and  applicable  state income
taxes. The charge for impairment loss was non-tax deductible and, therefore, did
not affect the company's provision for income taxes.

      NET INCOME (LOSS).

      For fiscal 2003,  Janel  reported a net income of $196,787,  a increase of
$315,570 as compared to reported net loss of $(118,783) in fiscal 2002. However,
excluding the effect of the charge for impairment loss, the company's net income
for fiscal  2002 would have been  $131,217,  yielding  an increase of $65,570 or
50.0% for fiscal 2003 as compared to fiscal 2002. On the same basis, Janel's net
profit margin (net income as a percent of net revenue)  would have  increased by
87 basis points from 2.25% in fiscal 2002 to 3.12% in fiscal 2003.

RESULTS OF OPERATIONS - FISCAL YEAR ENDED  SEPTEMBER 30, 2002 COMPARED TO FISCAL
YEAR ENDED SEPTEMBER 30, 2001

      REVENUE.

      Total revenue for fiscal 2002 was  $44,848,442  as compared to $46,650,094
for fiscal 2001, a year-over-year decrease of $(1,801,652), or (3.9)%. The lower
level of revenue was primarily due to the general decline in international trade
over the course of the year following the events of September 11, 2001.

      FORWARDING EXPENSE.

      Forwarding  expense  is  primarily  comprised  of the  fees  paid by Janel
directly to cargo carriers to handle and transport its actual freight  shipments
on behalf of its customers between initial and final terminal points. Forwarding
expense  also  includes  any  duties  and/or  trucking  charges  related  to the
shipments. For fiscal year 2002, forwarding expense decreased by $1,717,066,  or
4.2%,  to  $39,025,117  as compared  to  $40,742,183  for fiscal year 2001.  The
decline   was   consistent   with  the  lower   level  of   forwarding   revenue
year-over-year.

      SELLING, GENERAL AND ADMINISTRATIVE EXPENSE.

      Selling,  general and administrative  expense decreased $274,800, or 4.7%,
to  $5,571,584  in fiscal 2002 as compared to  $5,846,384  in fiscal 2001.  As a
percentage  of  revenue,   SG&A  expense  in  fiscal  2002  at  12.42%  remained
essentially flat as compared to the prior year.

      INCOME FROM OPERATIONS.

      Primarily as a result of the  proportionately  greater percentage declines
in forwarding and SG&A expenses relative to the percentage decline in revenue in
fiscal 2002 as compared to fiscal  2001,  Janel's  income from  operations  rose
$203,259, or 741.2%, to $230,682 in fiscal 2002 as compared to $27,423 in fiscal
2001. Despite the year-over-year decline in revenue, the operating income margin
(i.e.,  based on income  before  taxes and other  items) on net  revenue  (total
forwarding revenue less forwarding  expenses) increased by 350 basis points from
0.46% in fiscal 2001 to 3.96% in fiscal 2002.

      IMPAIRMENT LOSS.

      In the  fourth  quarter  of fiscal  2002,  Janel  booked a  non-recurring,
non-cash  charge of $250,000 for an  impairment  loss  related to the  company's
reverse merger transaction with Wine Systems Design, Inc. ("WSD"),  completed on
July 26,  2002,  and through  which Janel World  Trade,  Ltd.  became a publicly
traded company.  Under the terms of the  transaction,  4,000,000 shares of Janel
common stock were assigned a value of $250,000  representing  the estimated fair
value of the WSD public shell.  This amount,  which  represented the cost of the
acquisition  over the fair  value of net  assets  acquired,  was  attributed  to
goodwill.  The goodwill was subsequently reviewed for impairment and was written
off.


                                       18
<PAGE>

      INCOME (LOSS) BEFORE INCOME TAXES.

      Primarily as a result of the  nonrecurring  charge for impairment  loss of
$250,000,  the company reported a loss before income taxes of $(9,283) in fiscal
2002 as  compared  to income  before  income  taxes of $66,666  in fiscal  2001.
Excluding  the effect of the  impairment  loss,  Janel's  income before taxes in
fiscal  2002 would have been  $240,717,  an  increase  of  $174,051 or 261.1% as
compared to income before taxes reported in fiscal 2001.

      INCOME TAXES.

      The  effective  income  tax rate in both the fiscal  2002 and fiscal  2001
years  reflects the U.S.  federal  statutory  rate and  applicable  state income
taxes. The charge for impairment loss was non-tax deductible and, therefore, did
not affect the company's provision for income taxes.

      NET INCOME (LOSS).

      For fiscal 2002,  Janel reported a net loss of  $(118,783),  a decrease of
$(157,749)  as  compared  to  reported  net income of  $38,966  in fiscal  2001.
However,  excluding the effect of the charge for impairment  loss, the company's
net income for fiscal 2002 would have been  $131,217,  an increase of $92,251 or
236.7% as compared to fiscal 2001. On the same basis,  Janel's net profit margin
(net  income as a percent  of net  revenue)  would have  increased  by 159 basis
points from 0.66% in fiscal 2001 to 2.25% in fiscal 2002.

      LIQUIDITY AND CAPITAL RESOURCES

      Janel's  ability  to  meet  its  liquidity  requirements,   which  include
satisfying its debt obligations,  funding working capital,  day-to-day operating
expenses and capital expenditures depends upon its future performance,  which is
subject to general  economic  conditions  and other  factors,  some of which are
beyond its control.  During the 12 months  ended  September  30,  2003,  Janel's
primary  requirements  for working  capital  have been  directly  related to the
funding of increased accounts receivable.

      At September  30, 2004,  cash  increased  by $227,101 to  $1,287,507  from
$1,060,406  at September 30, 2003.  For the 12 months ended  September 30, 2004,
Janel's  primary use of cash in operating  activities was to finance an increase
in its  accounts  receivable  by  $972,613,  partially  offset by an increase in
accounts  payable  and accrued  expenses of $936,668  and an increase in prepaid
expenses and sundry current assets of $9,680.  For financing  activities,  Janel
increased cash through an increase in long-term debt of $26,515.

      At September  30, 2003,  cash  decreased  by $138,535 to  $1,060,406  from
$1,198,941  at September 30, 2002.  For the 12 months ended  September 30, 2003,
Janel's  primary use of cash in operating  activities was to finance an increase
in its accounts  receivable by  $1,248,272,  partially  offset by an increase in
accounts  payable  and accrued  expenses of $342,507  and an increase in prepaid
expenses and sundry current assets of $40,998. For financing  activities,  Janel
increased cash through bank borrowings of $500,000.


                                       19
<PAGE>

      At September 30, 2004, Janel had $1,200,000  ($700,000 as of September 30,
2003) of  available  borrowings  remaining  under a line of  credit  with a bank
pursuant to which it may borrow up to $2,000,000 ($1,500,000 as of September 30,
2003) bearing interest at prime plus one-half of one percent,  collateralized by
certificates  of  deposit.   Management  believes  anticipated  cash  flow  from
operations  and  availability  under a line of credit is  sufficient to meet the
working  capital  and  operating  needs of its  currently  existing  sources  of
business.  However, the company is also proceeding with its comprehensive growth
strategy  for fiscal 2005 and beyond,  which  encompasses  a number of potential
elements,  as detailed below under "Current  Outlook." To  successfully  execute
various of these growth strategy elements in the coming months, the company will
need to secure additional  capital funding estimated at up to $10,000,000 during
that  period.  There is no  assurance  either  that such  additional  capital as
necessary to execute the company's  business plan and intended  growth  strategy
will be available or, if available,  will be extended to the company at mutually
acceptable terms.

      REVERSE MERGER WITH WINE SYSTEMS DESIGN, INC.

      In June and  July  2002,  C and N Corp.,  a  predecessor  of the  company,
entered  into and  completed  a reverse  merger  transaction  with Wine  Systems
Design, Inc., formally changed the corporate name to Janel World Trade, Ltd. and
became a public  company  traded on the OTC  Bulletin  Board  under  the  symbol
"JLWT." As a result of the merger  transaction  and  related  amendments  to the
company's  certificate  of  incorporation,  Janel is  authorized  to issue up to
225,000,000  shares of common stock,  $.001 par value each, of which  16,843,000
shares are currently issued and outstanding.

      CURRENT OUTLOOK

      Janel is primarily engaged in the business of providing full-service cargo
transportation  logistics  management,  including freight  forwarding - via air,
ocean and land-based  carriers - customs  brokerage  services,  warehousing  and
distribution  services, and other value-added logistics services. Its results of
operations  are  affected  by the general  economic  cycle,  particularly  as it
influences global trade levels and specifically the import and export activities
of  Janel's  various  current  and  prospective  customers.   Historically,  the
company's  quarterly  results of operations have been subject to seasonal trends
which have been the result of, or  influenced  by,  numerous  factors  including
climate, national holidays, consumer demand, economic conditions, the growth and
diversification of its international  network and service  offerings,  and other
similar and subtle forces.

      Based upon the results for the fiscal year ended  September 30, 2004,  and
its current  operations,  Janel  projects  that gross revenue from its currently
existing  accounts and businesses for its fiscal year ending  September 30, 2005
will grow by approximately 10-15% to approximately $77 - $80 million.

      In addition,  Janel is progressing with the implementation of its business
plan and  strategy  to grow its revenue  and  profitability  for fiscal 2005 and
beyond through other avenues.  The company's  strategy for growth includes plans
to: open additional branch offices  domestically  and/or outside the continental
United  States;   introduce   additional   revenue   streams  for  its  existing
headquarters and branch  locations;  proceed with negotiations and due diligence
with privately held  transportation-related  firms which may ultimately  lead to
their  acquisition  by the company;  expand its  existing  sales force by hiring
additional  commission-only  sales  representatives  with  established  customer
bases;  increase  its focus on growing  revenue  related  to export  activities;
evaluate direct entry into the trucking and warehouse distribution business as a
complement to the services already provided to existing customers;  and continue
its focus on containing current and prospective overhead and operating expenses,
particularly with regard to the efficient  integration of any additional offices
or acquisitions.  Assuming successful execution of substantial elements of these
growth  strategies,  the  company  projects  that gross  revenue for fiscal 2005
(which may  approximate  $100 million) could be  significantly  greater than its
gross revenue for fiscal 2004,  and that  profitability  will be  commensurately
greater than should Janel's fiscal 2004 results, as well.


                                       20
<PAGE>

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

         Not applicable.

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

      The financial  statements and  supplementary  data required by this Item 8
are included in the company's  Consolidated  Financial Statements listed in Item
15(a) of this Annual Report.

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

          Not applicable.

ITEM 9A. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures.

      As required by Rule 13a-15 under the Act,  within the 90 days prior to the
filing  date of this  report,  the  company  carried  out an  evaluation  of the
effectiveness of the design and operation of the company's  disclosure  controls
and  procedures.  This evaluation was carried out under the supervision and with
the participation of the company's management, including the company's Executive
Vice  President  and Chief  Executive  Officer,  President  and Chief  Operating
Officer,  and Controller and Principal Financial and Accounting  Officer.  Based
upon that evaluation, the company's Executive Vice President and Chief Executive
Officer,  President and Chief  Operating  Officer and  Controller  and Principal
Financial and Accounting Officer,  have concluded that the company's  disclosure
controls  and  procedures  are  effective  in timely  alerting  them to material
information  relating  to the company  required to be included in the  company's
periodic SEC filings.

      Disclosure  controls and procedures are controls and other procedures that
are  designed to ensure that  information  required to be  disclosed  in company
reports filed or submitted under the Act is recorded, processed,  summarized and
reported,  within  the  time  periods  specified  in the SEC  rules  and  forms.
Disclosure  controls and procedures include,  without  limitation,  controls and
procedures  designed to ensure that  information  required  to be  disclosed  in
company reports filed under the Exchange Act is accumulated and  communicated to
management,  including the company's  Chief Executive  Officer,  Chief Operating
Officer, and Principal Financial and Accounting Officer as appropriate, to allow
timely decisions regarding required disclosures.

Changes in Internal Controls.

      There have been no changes in internal  controls or in other  factors that
could  significantly  affect  these  controls  subsequent  to the  date of their
evaluation,   including  any  corrective  actions  with  regard  to  significant
deficiencies and material weaknesses.


                                       21
<PAGE>

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

      The executive officers and directors of the Registrant are as follows:

Name                     Age            Position
----                     ---            --------
Stephen P. Cesarski      59             President, Chief Operating
                                        Officer and Director

James N. Jannello        60             Executive Vice President,
                                        Chief Executive Officer and
                                        Director

William J. Lally         51             Director

Ruth Werra               63             Secretary

Linda Bieler             43             Controller and Chief Financial
                                        and Accounting Officer


      Stephen P.  Cesarski has been the  President and a director of Janel since
1978. Mr. Cesarski is the Chief Operating Officer and is principally  engaged in
sales and marketing and also manages the export side of the company's business.

      James N. Jannello is the Executive  Vice  President and has been the Chief
Executive  Officer  of  Janel  since it was  founded  in  1974.  Mr.  Jannello's
principal  function  is the  overseeing  of all  of  the  company's  operations,
management  of the import side of the business and the setting of billing  rates
and  charges,   and  the  maintenance  of  relationships  with  overseas  agents
worldwide. Mr. Jannello is a licensed Customs House Broker.

      William J. Lally was initially  employed by Janel in New York City in 1975
and moved to Chicago,  Illinois in 1979,  where he is the President of the Janel
Group of Illinois, Inc. Mr. Lally became a director of the company in July 2002.

      Ruth  Werra  has  been the  Secretary  of  Janel  since  1994 and has been
employed by the company  since 1975.  She is the office  manager of the New York
executive office and oversees the maintenance of Janel's corporate records. Mrs.
Werra also  oversees the entry and clearance of all personal  effects  shipments
handled by the New York office.

      Linda Bieler has been the Controller of Janel since 1994. She is the Chief
Financial and  Accounting  Officer and oversees  accounting  operations  for all
branches, and manages its information systems and generation of its reports.

      Directors  hold office until the next annual meeting of  shareholders  and
thereafter  until their  successors  have been duly elected and  qualified.  The
executive  officers are elected by the Board of Directors on an annual basis and
serve under the direction of the board.  Executive  officers devote all of their
business time to the company's affairs.

      Janel's  Board  of  Directors  does  not  yet  include  any  "independent"
directors,  and the  company  does  not have a  separate  Audit  Committee  or a
Compensation Committee.

ITEM 11. EXECUTIVE COMPENSATION

      SUMMARY COMPENSATION TABLE


                                       22
<PAGE>

      The following  table sets forth,  for the fiscal years ended September 30,
2004,  2003 and 2002,  the cash  compensation  paid by the  company,  as well as
certain other  compensation  paid with respect to those years and months, to the
Chief Executive Officer and, to the extent  applicable,  each of the three other
most highly  compensated  executive officers of the company in all capacities in
which they served.
<TABLE>
<CAPTION>

                                                   Other Annual     Awards,       Securi-tiePayouts,     All Other
Name and          Year     Salary      Bonus       Compensation     Restricted    Under-lyinLTIP         Compen-
Principal                  ($)         ($)         ($)              Stock         Options   Payouts      sation
Position                                                            Awards ($)     /SARs     (#)          ($)
----------------- -------- ----------- ----------- ---------------- ------------- --------- ------------ -----------
<S>               <C>      <C>           <C>       <C>    <C>
Stephen P.        2002     153,285       35,000    17,981 (1)
Cesarski (1)      2003     164,085        6,080    41,772 (1)
President and     2004     161,689                 48,656 (1)
Chief Operating
Officer
----------------- -------- ----------- ----------- ---------------- ------------- --------- ------------ -----------
James N.          2002     147,377       35,000    13,685 (2)
Jannello (2)      2003     160,337        6,080    50,729 (2)
Executive Vice    2004     166,780                 49,750 (2)
President and
Chief Executive
Officer
----------------- -------- ----------- ----------- ---------------- ------------- --------- ------------ -----------
Noel J.           2002     118,436                  8,819 (3)
Jannello (3)      2003     124,426                 13,913 (3)
Vice President    2004     132,873                 24,242 (3)
----------------- -------- ----------- ----------- ---------------- ------------- --------- ------------ -----------
William J.        2002     100,560                  4,075 (4)
Lally (4)         2003     108,382                 21,004 (4)
Director          2004     108,382                 13,112 (4)
----------------- -------- ----------- ----------- ---------------- ------------- --------- ------------ -----------
</TABLE>

(1)   Includes  $12,821,  $11,374 and $9,783 and of medical  insurance  premiums
      paid on behalf of such individual for each of the fiscal years ended 2004,
      2003 and 2002 respectively, $33,889, $26,002 and $6,009 for automobile and
      automobile-related costs, including insurance,  incurred on behalf of such
      individual,  for  each of the  fiscal  years  ended  2004,  2003  and 2002
      respectively,$1,946,  $4,396  and  $2,189  of 401K  paid on behalf of such
      individual  for  each of the  fiscal  years  ended  2004,  2003  and  2002
      respectively.

(2)   Includes $10,132, $10,494 and $5,761 of medical insurance premiums paid on
      behalf of such  individual  for each of the fiscal years ended 2004,  2003
      and 2002  respectively,  $37,623,  $35,895 and $5,819 for  automobile  and
      automobile-related costs, including insurance,  incurred on behalf of such
      individual,  for  each of the  fiscal  years  ended  2004,  2003  and 2002
      respectively,  $1,995,  $4,340  and  $2,105 of 401K paid on behalf of such
      individual  for  each of the  fiscal  years  ended  2004,  2003  and  2002
      respectively.

(3)   Includes $10,132,  $4,500 and $4,500 of medical insurance premiums paid on
      behalf of such  individual  for each of the fiscal years ended 2004,  2003
      and 2002  respectively,  $12,937,  $6,496 and $3,000  for  automobile  and
      automobile-related costs, including insurance,  incurred on behalf of such
      individual,  for  each of the  fiscal  years  ended  2004,  2003  and 2002
      respectively,  $1,173,  $2,917  and  $1,319 of 401K paid on behalf of such
      individual for each fiscal years ended 2004, 2003 and 2002 respectively.


                                       23
<PAGE>

(4)   Includes $13,112, $19,643 and $4,075 for automobile and automobile-related
      costs, including insurance, incurred on behalf of such individual for each
      of the fiscal years ended 2004, 2003 and 2002  respectively,$1,361 of 401K
      paid on behalf of such individual for each fiscal year ended 2003.


ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

      The following  table sets forth certain  information  regarding  shares of
common stock  beneficially  owned as of December  29, 2004,  by (i) each person,
known to the company,  who  beneficially  owns more than 5% of the common stock,
(ii) each of the  company's  directors and (iii) all officers and directors as a
group:

Name and Address of                                      Percentage of
Beneficial Owner          Shares Beneficially Owned      Stock Outstanding (1)

Stephen P. Cesarski
150-14 132nd Avenue
Jamaica, NY 11434               5,500,000                   32.65%

James N. Jannello
150-14
132nd Avenue
Jamaica, NY 11434               5,500,000                   32.65%

William J.  Lally
17 West 312th Deer Path Rd.
Bensenville, IL 60106           1,000,000                    5.94%

All Officers and
Directors as a Group
(5 persons)                    12,050,000                   71.54%
--------------------------

(1)   All of these shares are owned of record.

      COMMON STOCK

      Janel is  authorized  to issue up to  225,000,000  shares of common stock,
$.001 par value  each,  of which  16,843,000  shares  are  currently  issued and
outstanding. The holders of common stock are entitled to one vote for each share
held of  record  on all  matters  to be  voted on by  shareholders.  There is no
cumulative  voting with  respect to the election of  directors,  with the result
that the holders of more than 50% of the shares of common stock can elect all of
the directors.  The company's principal officers,  James N. Jannello and Stephen
P. Cesarski,  collectively own 65.3% of the issued and outstanding  common stock
and  therefore can elect all of the  directors.  The holders of common stock are
entitled to receive dividends when and if declared by the Board of Directors out
of funds legally available therefore.  In the event of liquidation,  dissolution
or winding up of the  company,  the owners of common stock are entitled to share
all assets remaining available for distribution after the payment of liabilities
and  after  provision  has been  made for each  class  stock,  if any,  having a
preference  over the common stock as such.  The common stock has no  conversion,
preemptive or other subscription  rights, and there are no redemption  revisions
applicable to the common stock.


                                       24
<PAGE>

      SAVINGS AND STOCK OPTION PLANS

      401(k) and Profit-Sharing Plan.

      The company  maintains  an Internal  Revenue Code  Section  401(k)  salary
deferral  savings and  profit-sharing  plan (the "Plan") for all of its eligible
employees who have been employed for at least one year and are at least 21 years
old. Subject to certain limitations, the Plan allows participants to voluntarily
contribute  up to 15% of their pay on a  pre-tax  basis.  Under  the  Plan,  the
company may make matching  contributions on behalf of the pre-tax  contributions
made  up to a  maximum  of 25% of the  participant's  first  5% of  compensation
contributed as Elective Deferrals in the year. All participants are fully vested
in  their   accounts  in  the  Plan  with  respect  to  their  salary   deferral
contributions,  and are vested in company matching  contributions at the rate of
20% after  three years of  service,  40% after four years of service,  60% after
five years of service,  80% after six years of service,  with 100% vesting after
seven years of service.

      Stock Option Plan.

      On December  12,  2002,  Janel's  Board of  Directors  and majority of its
shareholders  approved  and adopted the Janel World  Trade,  Ltd.  Stock  Option
Incentive  Plan (the  "Option  Plan")  providing  for  options to purchase up to
1,600,000   shares  of  common  stock  for  issuance  to  valued  employees  and
consultants of the company as an incentive for superior performance.

      To date,  no options have been granted  under the Option Plan.  The Option
Plan is  administered  by the Board of  Directors,  which is authorized to grant
incentive  stock options and non qualified  stock options to selected  employees
and consultants of the company and to determine the participants,  the number of
options to be granted and other terms and provisions of each option.

      The exercise price of any incentive  stock option or  nonqualified  option
granted under the Option Plan may not be less than 100% of the fair market value
of the shares of common  stock of the  company at the time of the grant.  In the
case of  incentive  stock  options  granted  to  holders of more than 10% of the
voting power of the company, the exercise price may not be less than 110% of the
fair market value.

      Under the terms of the  Option  Plan,  the  aggregate  fair  market  value
(determined  at the time of grant) of shares  issuable to any one recipient upon
exercise of incentive  stock options  exercisable  for the first time during any
one calendar year may not exceed $100,000. Options granted under the Option Plan
may be exercisable in either one, two or three equal annual  installments at the
discretion  of the Board of  Directors,  but in no event  may a stock  option be
exercisable prior to the expiration of six months from the date of grant, unless
the grantee dies or becomes disabled prior thereto.  Stock options granted under
the Option Plan have a maximum  term of 10 years from the date of grant,  except
that with respect to incentive  stock options granted to an employee who, at the
time of the  grant,  is a holder  of more  than 10% of the  voting  power of the
company, the stock option shall expire not more than five years from the date of
the grant.  The option price must be paid in full on the date of exercise and is
payable in cash or in shares of common  stock  having a fair market value on the
date the option is exercised  equal to the option  price,  as  determined by the
Board of Directors.


                                       25
<PAGE>

      If a grantee's  employment  by, or  provision  of services to, the company
shall be terminated,  the Board of Directors may, in its discretion,  permit the
exercise  of stock  options for a period not to exceed one year  following  such
termination  of  employment  with respect to incentive  stock  options and for a
period not to extend  beyond the  expiration  date with respect to non qualified
options,  except that no incentive  stock  option may be  exercised  after three
months following the grantee's termination of employment, unless due to death or
permanent disability,  in which case the option may be exercised for a period of
up to one year following such termination.

      Transfer Agent.

      The company's  current transfer agent is Executive  Registrar,  3615 South
Huron Street, Suite 104, Englewood, CO 80110.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

      Stephen P. Cesarski,  Janel's President and Chief Operating  Officer,  and
James N. Jannello, Janel's Executive Vice President and Chief Executive Officer,
each own a 10% profit  interest in each of Janel  Shanghai  and Janel Hong Kong.
Mr. Jannello also owns 50% of Janel Miami (Florida), which is a franchisee using
the Janel name, but in which the company has no equity or other direct  economic
interest.

      As of the fiscal year end of  September  30, 2004,  James N.  Jannello was
indebted to the company in the  aggregate  sum of $146,184,  Steve  Cesarski was
indebted  in the amount of $7,255  and  William  J.  Lally was  indebted  in the
aggregate  amount of $7,550.  The officer loans to Mr. Jannello and Mr. Cesarski
each  bear  interest  at 4%  per  annum.  The  officer  loan  to  Mr.  Lally  is
non-interest bearing. The officer loans are due on demand.

      The transactions  described above involve actual or potential conflicts of
interest  between Janel and its officers.  To reduce the potential for conflicts
of interest  between the company and its officers  and  directors in the future,
Janel's  policy  will  be  not  to  enter  into  potential  conflict-of-interest
transactions  with officers,  directors or other affiliates  unless the terms of
such  transactions  are at least as favorable to Janel as those which would have
been obtainable from an unaffiliated  source.  The company has no plans to enter
into any additional  transactions that involve actual or potential  conflicts of
interest  between Janel and its officers or  directors,  and will not enter into
any such  transaction  in the future  without  first  obtaining  an  independent
opinion with regard to fairness to Janel of the terms and conditions of any such
transaction.

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES

      AUDIT FEES

      The aggregate  fees billed by Paritz & Company,  P.A. for the annual audit
were $25,000 and $24,500 for the fiscal years ended September 30, 2004 and 2003,
respectively, and their fees for review of the interim financial statements were
$10,500  and $10,500 for the fiscal  years  ended  September  30, 2004 and 2003,
respectively.

                                       26
<PAGE>

      FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION FEES

      Paritz & Company,  P.A. did not render any professional  services to Janel
World Trade, Ltd. for financial  information  systems design and implementation,
as described in Paragraph  (c)(4)(ii) of Rule 2-01 of Regulation S-X, during the
fiscal years ended September 30, 2004 and 2003.

      ALL OTHER FEES

      The aggregate fees billed by Paritz & Company, P.A. for all other services
rendered to Janel World Trade,  Ltd. during the fiscal years ended September 30,
2004 and 2003, other than audit services, were $11,774 for the fiscal year ended
September 30, 2004,  and $5,000 in each of the fiscal years ended  September 30,
2003 and 2002.  These  "other  fees" were for  services  related to an abandoned
acquisition ($6,774), and tax services ($5,000).

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.

      (A)   FINANCIAL STATEMENTS.

            Independent Auditor's Report

            Consolidated Balance Sheets as at September 30, 2004 and 2003

            Consolidated  Statement of Operations for the Years Ended  September
            30, 2004, 2003 and 2002

            Consolidated  Statement of Changes in  Stockholders'  Equity for the
            Years Ended September 30, 2004, 2003 and 2002

            Consolidated  Statement of Cash Flows for the Years Ended  September
            30, 2004, 2003 and 2002

            Notes to Consolidated Financial Statements

      (C)   EXHIBITS.

      2.    Agreement  and Plan of Merger  dated July 18, 2002 by and among Wine
            Systems  Design,  Inc.,  WSD  Acquisition,   Inc.  and  Janel  World
            Transport, Ltd.**

      3(i)  Articles  of  Incorporation   of  Wine  Systems  Design,   Inc.
            (predecessor name) filed on August 31, 2000.*

      3(ii) By-laws of Wine Systems Design, Inc. (predecessor name) adopted
            on September 1, 2000.*

      10.1  Janel Stock Option Incentive Plan adopted December 12, 2002.

      23.1  Consent of Paritz & Company, P.A.

      23.2  Letter dated August 1, 2002,  from Michael L. Stuck,  C.P.A.,  P.C.,
            the former independent certifying accountant.***

      31    Rule 13(a)-14(a)/15(d)-14(a) Certifications.

      32    Section 1350 Certification.


                                       27
<PAGE>

      *     Incorporated  by  reference  to  Exhibits  filed as part of the Wine
            Systems Design,  Inc.  (predecessor name) Registration  Statement on
            Form SB-2 under File No. 333-60608, filed May 10, 2001.

      **    Incorporated by reference to Exhibits filed as part of the company's
            Form 8-K report, filed July 18, 2002.

      ***   Incorporated by reference to Exhibits filed as part of the company's
            Form 8-K/A report, filed August 1, 2002.

      (D)   FINANCIAL STATEMENT SCHEDULES.

      Schedules are omitted because they are not applicable, are not required or
because the  information  is included in the  company's  Consolidated  Financial
Statements or notes thereto.

                                   SIGNATURES

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

December 28, 2004

                                     JANEL WORLD TRADE, LTD.

                                     By:/s/ James N. Jannello
                                     -------------------------------------------
                                     James N. Jannello, Executive Vice President
                                     and Chief Executive Officer

      Pursuant to the requirements of the Securities  Exchange Act of 1934, this
Report been signed below by the  following  persons on behalf of the  Registrant
and in the capacities and on the dates indicated.



/s/ James N. Jannello     Executive Vice President, Chief     December 28, 2004
---------------------     Executive Officer and Director
James N. Jannello

/s/ Stephen P. Cesarski   President, Chief Operating          December 28, 2004
-----------------------   Officer and Director
Stephen P. Cesarski

/s/ William J. Lally      Director                            December 28, 2004
--------------------
William J. Lally

/s/ Linda Bieler          Controller and Chief Financial      December 28, 2004
----------------          and Accounting Officer
Linda Bieler

/s/ Ruth Werra            Secretary                           December 28, 2004
--------------
Ruth Werra

                                       28
<PAGE>

PARITZ & COMPANY, P.A.


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

                     JANEL WORLD TRADE LTD. AND SUBSIDIARIES

                        CONSOLIDATED FINANCIAL STATEMENTS
                                      WITH
                          INDEPENDENT AUDITORS' REPORT

                     YEARS ENDED SEPTEMBER 30, 2004 AND 2003

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


<PAGE>


                          INDEPENDENT AUDITORS' REPORT

Board of Directors
Janel World Trade Ltd. and Subsidiaries
Jamaica, New York

We have  audited the  accompanying  consolidated  balance  sheets of Janel World
Trade Ltd. and  Subsidiaries  as of September  30, 2004 and 2003 and the related
consolidated statements of operations,  changes in stockholders' equity and cash
flows for each of the three years in the period ended September 30, 2004.  These
financial  statements are the  responsibility of the Company's  management.  Our
responsibility  is to express an opinion on these financial  statements based on
our audits.

We conducted our audits in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and  perform  the  audits 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 consolidated  financial statements referred to above present
fairly, in all material  respects,  the financial  position of Janel World Trade
Ltd. and  Subsidiaries  as of September 30, 2004 and 2003 and the results of its
operations  and its cash flows for each of the three  years in the period  ended
September 30, 2004 in conformity with accounting  principles  generally accepted
in the United States of America.

Hackensack, New Jersey
DATE: November 22, 2004

<PAGE>

                     JANEL WORLD TRADE LTD. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS
================================================================================


                                                          SEPTEMBER 30,
                                                        2004         2003
                                                     ----------   ----------
                                ASSETS
CURRENT ASSETS
  Cash (NOTES 1,6)                                   $1,287,507   $1,060,406
  Accounts receivable, net of
   allowance for doubtful accounts of
   $31,413 in 2004 and $30,000 in 2003                5,280,435    4,307,822
  Marketable securities (NOTE 3)                         46,137       41,093
  Loans receivable - officers (NOTE 4)                  160,989      158,332
                              - other                    26,153       18,479
  Prepaid expenses and sundry current assets             67,524       57,844
                                                     ----------   ----------
     TOTAL CURRENT ASSETS                             6,868,745    5,643,976
                                                     ----------   ----------

PROPERTY AND EQUIPMENT, NET (NOTE 5)                    111,816      102,930
                                                     ----------   ----------

OTHER ASSETS:
  Security deposits                                      49,928       51,354
                                                     ----------   ----------
     TOTAL OTHER ASSETS                                  49,928       51,354
                                                     ----------   ----------

                                                     $7,030,489   $5,798,260
                                                     ==========   ==========
           LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
  Note payable - bank (NOTE 6)                       $  800,000   $  800,000
  Accounts payable                                    3,164,933    2,273,345
  Accrued expenses and taxes payable                    153,720      108,640
  Current portion of long-term debt (NOTE 7)              8,393        3,840
                                                     ----------   ----------
     TOTAL CURRENT LIABILITIES                        4,127,046    3,185,825
                                                     ----------   ----------

OTHER LIABILITIES:
  Long-term debt                                         21,962           --
  Deferred compensation                                  78,568       78,568
                                                     ----------   ----------
     TOTAL OTHER LIABILITIES                            100,530       78,568
                                                     ----------   ----------

STOCKHOLDERS' EQUITY (NOTE 8)                         2,802,913    2,533,867
                                                     ----------   ----------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY           $7,030,489   $5,798,260
                                                     ==========   ==========

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

                 The accompanying notes are an integral part of
                    these consolidated financial statements
<PAGE>

<TABLE>
<CAPTION>

                     JANEL WORLD TRADE LTD. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF OPERATIONS
================================================================================

                                                               YEAR ENDED SEPTEMBER 30,
                                                         2004            2003           2002
                                                     ------------    ------------   ------------
<S>                                                  <C>             <C>            <C>
FREIGHT FORWARDING REVENUES                          $ 69,981,639    $ 56,916,276   $ 44,848,442
                                                     ------------    ------------   ------------



COSTS AND EXPENSES:
  Forwarding expenses                                  63,041,177      50,600,299     39,025,117
  Selling, general and administrative                   6,323,606       5,956,591      5,571,584
  Interest                                                 43,377          22,824         21,059
                                                     ------------    ------------   ------------
     TOTAL COSTS AND EXPENSES                          69,408,160      56,579,714     44,617,760
                                                     ------------    ------------   ------------

INCOME BEFORE OTHER ITEMS                                 573,479         336,562        230,682
                                                     ------------    ------------   ------------

OTHER ITEMS:
  Costs related to abandoned business acquisitions       (119,160)
  Impairment loss (NOTE 2)                                     --              --       (250,000)
  Interest and dividend income                             14,636          19,725         10,035
                                                     ------------    ------------   ------------
     TOTAL OTHER ITEMS                                   (104,524)         19,725       (239,965)
                                                     ------------    ------------   ------------

INCOME (LOSS) BEFORE INCOME TAXES                         468,955         356,287         (9,283)

Income taxes (NOTE 9)                                     204,600         159,500        109,500
                                                     ------------    ------------   ------------

NET INCOME (LOSS)                                    $    264,355    $    196,787   $   (118,783)
                                                     ============    ============   ============


BASIC AND DILUTED INCOME (LOSS) PER SHARE            $      .0157    $      .0117   $     (.0077)
                                                     ============    ============   ============

WEIGHTED NUMBER OF SHARES OUTSTANDING                  16,843,000      16,839,433     15,350,332
                                                     ============    ============   ============

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

     The accompanying notes are an integral part of these consolidated financial statements
</TABLE>

<PAGE>

<TABLE>
<CAPTION>

                                             JANEL WORLD TRADE LTD. AND SUBSIDIARIES

                                  CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
==================================================================================================================================


                                                                                                         ACCUMULATED
                                       CAPITAL STOCK           ADDITIONAL                 STOCK          OTHER
                                                               PAID-IN      RETAINED      SUBSCRIPTION   COMPREHENSIVE
                                    SHARES          $          CAPITAL      EARNINGS      RECEIVABLE     GAIN (LOSS)      TOTAL
                                 -----------   -----------   -----------   -----------    -----------    -----------   -----------
<S>                                   <C>     <C>           <C>           <C>            <C>            <C>           <C>
BALANCE - SEPTEMBER 30, 2001           1,000   $     3,200   $   228,887   $ 1,951,091    $        --    $   (13,367)  $ 2,169,811
Net loss                                  --            --            --      (118,783)            --             --      (118,783)
Effect of stock splits
 and return of shares (NOTE 2)    14,999,000        11,800       238,200            --             --             --       250,000
Sale of common stock (NOTE 8)      1,801,000         1,801        16,209            --        (18,010)            --            --
Other comprehensive (losses):
    Unrealized gains on
     available -for-sale
     marketable securities                --            --            --            --             --         (4,676)       (4,676)
                                 -----------   -----------   -----------   -----------    -----------    -----------   -----------

BALANCE - SEPTEMBER 30, 2002      16,801,000        16,801       483,296     1,832,308        (18,010)       (18,043)    2,296,352
Net income                                --            --            --       196,787             --             --       196,787
Stock subscription received               --            --            --            --         18,010             --        18,010
Issuance of common stock (NOTE 8)     42,000            42        15,567            --             --             --        15,609
Other comprehensive gains:
    Unrealized gains on
     available -for-sale
     marketable securities                --            --            --            --             --          7,109         7,109
                                 -----------   -----------   -----------   -----------    -----------    -----------   -----------

BALANCE - SEPTEMBER 30, 2003      16,843,000        16,843       498,863     2,029,095             --        (10,934)    2,533,867
Net income                                --            --            --       264,355             --             --       264,355
Other comprehensive gains:
    Unrealized gains on
     available-for-sale
     marketable securities                --            --            --            --             --          4,691         4,691
                                 -----------   -----------   -----------   -----------    -----------    -----------   -----------

BALANCE - SEPTEMBER 30, 2004      16,843,000   $    16,843   $   498,863   $ 2,293,450    $        --    $    (6,243)  $ 2,802,913
                                 ===========   ===========   ===========   ===========    ===========    ===========   ===========

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

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

</TABLE>

<PAGE>

<TABLE>
<CAPTION>

                           JANEL WORLD TRADE LTD. AND SUBSIDIARIES

                            CONSOLIDATED STATEMENTS OF CASH FLOWS
================================================================================================

                                                                YEAR ENDED SEPTEMBER 30,
                                                          2004            2003           2002
                                                       -----------    -----------    -----------
OPERATING ACTIVITIES:
<S>                                                    <C>            <C>            <C>
  Net income (loss)                                    $   264,355    $   196,787    $  (118,783)
  Adjustments to reconcile net income (loss) to net
    cash provided by (used in) operating activities:
      Impairment loss                                           --             --        250,000
      Stock issued for services                                 --         15,609             --
      Depreciation and amortization                         63,375         55,892         84,561
  Changes in operating assets and liabilities:
      Accounts receivable                                 (972,613)    (1,248,272)      (321,037)
      Loans receivable                                     (10,331)         2,046        (19,338)
      Prepaid expenses and sundry current assets            (9,680)        40,998          9,897
      Accounts payable and accrued expenses                936,668        342,507         36,462
      Other                                                  1,426         (2,647)           (56)
                                                       -----------    -----------    -----------
NET CASH PROVIDED BY (USED IN)  OPERATING ACTIVITIES       273,200       (597,080)       (78,294)
                                                       -----------    -----------    -----------

INVESTING ACTIVITIES:
  Acquisition of property and equipment, net               (72,261)       (50,946)       (26,632)
  Purchase of marketable securities                           (353)          (461)          (607)
                                                       -----------    -----------    -----------
NET CASH USED IN INVESTING ACTIVITIES                      (72,614)       (51,407)       (27,239)
                                                       -----------    -----------    -----------

FINANCING ACTIVITIES:
  Increase in (repayment of) long-term debt                 26,515         (8,058)       (99,608)
  Bank borrowings (repayment)                                   --        500,000        (25,000)
  Proceeds from sale of common stock                            --         18,010             --
                                                       -----------    -----------    -----------
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES         26,515        509,952       (124,608)
                                                       -----------    -----------    -----------

INCREASE (DECREASE) IN CASH                                227,101       (138,535)      (230,141)

CASH - BEGINNING OF YEAR                                 1,060,406      1,198,941      1,429,082
                                                       -----------    -----------    -----------

CASH - END OF YEAR                                     $ 1,287,507    $ 1,060,406    $ 1,198,941
                                                       ===========    ===========    ===========


SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
  Cash paid during the year for:
      Interest                                         $    43,377    $    22,824    $    21,059
                                                       ===========    ===========    ===========
      Income taxes                                     $   173,277    $   115,797    $     4,654
                                                       ===========    ===========    ===========
  Non-cash financing activities:
      Non-cash repayment of long-term debt             $        --    $        --    $    44,469
                                                       ===========    ===========    ===========

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

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

</TABLE>

<PAGE>

                     JANEL WORLD TRADE LTD. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                           SEPTEMBER 30, 2004 AND 2003
================================================================================

1     SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

      BUSINESS DESCRIPTION

      The Company is  primarily  engaged in  full-service  cargo  transportation
      logistics  management,  including  freight  forwarding  via air, ocean and
      land-based  carriers,  customs  brokerage  services  and  warehousing  and
      distribution services.

      BASIS OF CONSOLIDATION

      The accompanying consolidated financial statements include the accounts of
      the  Company  and its  subsidiaries,  all of which are wholly  owned.  All
      intercompany   transactions   and  balances   have  been   eliminated   in
      consolidation.

      USES OF ESTIMATES IN THE PREPARATION OF FINANCIAL STATEMENTS

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

      CASH AND CASH EQUIVALENTS

      The Company  maintains  cash balances at various  financial  institutions.
      Accounts at each institution are insured by the Federal Deposit  Insurance
      Corporation up to $100,000.  The Company's  accounts at these institutions
      may, at times,  exceed the federally  insured limits.  The Company has not
      experienced any losses in such accounts.

      MARKETABLE SECURITIES

      The   Company   classifies   all  of   its   short-term   investments   as
      available-for-sale   securities.   Such  short-term   investments  consist
      primarily  of  mutual  funds  which  are  stated  at  market  value,  with
      unrealized  gains  and  losses  on  such  securities  reflected  as  other
      comprehensive  income (loss) in stockholders'  equity.  Realized gains and
      losses on short-term  investments are included in earnings and are derived
      using the  specific  identification  method  for  determining  the cost of
      securities.  It is the Company's  intent to maintain a liquid portfolio to
      take advantage of investment opportunities.  Therefore, all securities are
      considered to be available for sale and are classified as current assets.

      PROPERTY AND EQUIPMENT AND DEPRECIATION POLICY

      Property and equipment are recorded at cost.  Depreciation is provided for
      in amounts  sufficient  to amortize  the costs of the related  assets over
      their estimated useful lives on the straight-line and accelerated  methods
      for both financial reporting and income tax purposes.

      Maintenance,  repairs  and minor  renewals  are  charged to  expense  when
      incurred. Replacements and major renewals are capitalized.

<PAGE>

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

      REVENUES AND REVENUE RECOGNITION

      Airfreight,  ocean freight and custom brokerage  services revenues include
      the  charges  to the  Company  for  carrying  the  shipments  and  customs
      clearance.  Revenues  recognized  in  other  capacities  include  only the
      commissions and fees earned.

      Revenues  related  to  export  shipments  are  recognized  at the time the
      freight is tendered  to a direct  carrier at origin.  Revenues  related to
      import shipments are recognized upon presentation of the entry for customs
      clearance.  All  other  revenues,  including  break-bulk  services,  local
      transportation,   distribution  services  and  logistics  management,  are
      recognized upon performance.

      DEFERRED COMPENSATION PLAN

      The  Company has a deferred  compensation  plan for key  executives  which
      provides  benefits due to death,  retirement or termination of employment.
      Such benefits  shall be determined  and paid in accordance  with the plan.
      The plan does not qualify under the Internal Revenue Code and,  therefore,
      tax deductions are allowable only when the benefits are paid.

      IMPAIRMENT OF LONG-LIVED ASSETS

      Long-lived assets are reviewed for impairment when circumstances  indicate
      the carrying value of an asset may not be recoverable. For assets that are
      to be held and  used,  an  impairment  is  recognized  when the  estimated
      undiscounted  cash flows  associated  with the asset or group of assets is
      less than their carrying  value.  If impairment  exists,  an adjustment is
      made to write the asset down to its fair value,  and a loss is recorded as
      the difference  between the carrying value and fair value. Fair values are
      determined  based  on  quoted  market  values,  discounted  cash  flows or
      internal and external appraisals, as applicable.  Assets to be disposed of
      are carried at the lower of carrying  value or  estimated  net  realizable
      value.

      INCOME PER COMMON SHARE

      Basic net income per common  share is  calculated  by dividing  net income
      available to common  shareholders by the weighted average of common shares
      outstanding  during the  period.  Diluted  net income per common  share is
      calculated  using  the  weighted  average  of  common  shares  outstanding
      adjusted to include the potentially dilutive effect of stock options.

      COMPREHENSIVE INCOME

      Comprehensive income encompasses all changes in stockholders' equity other
      than those arising from stockholders, and generally consists of net income
      and  unrealized  gains  and  losses  on  unrestricted   available-for-sale
      marketable equity securities.  As of September 30, 2004, accumulated other
      comprehensive  income (loss) consists of unrealized losses on unrestricted
      available-for-sale marketable equity securities.

2     MERGERS, ACQUISITIONS AND ABANDONED ACQUISITIONS

      Pursuant to an  agreement  and plan of merger dated as of June 17, 2002, C
      and N Corp. ("CN") was merged into Janel World Transport,  Ltd. ("Janel"),
      a newly formed Nevada  corporation  having the same shareholders as CN. In
      connection therewith, the shareholders of CN were issued 11,000,000 shares
      of Janel common stock ("Janel shares").

<PAGE>

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

2     MERGERS, ACQUISITIONS AND ABANDONED ACQUISITIONS - CONTINUED

      Pursuant  to an  agreement  and plan of merger  dated June 18,  2002 among
      Janel,  Wine  Systems  Design,  Inc.  ("WSD"),  a  publicly  owned  Nevada
      corporation  and WSD  Acquisition,  Inc.  ("WSD  Acquisition"),  a  Nevada
      corporation and wholly owned subsidiary of WSD, the following transactions
      occurred:

      (i)   WSD  effectuated a 19.2307 shares for 1 share stock split  resulting
            in WSD's capitalization  becoming  225,000,000  authorized shares of
            common stock ("WSD common stock"),  of which 202,076,923 shares were
            issued and outstanding.

      (ii)  WSD issued and  delivered  11,000,000  shares of WSD common stock to
            WSD Acquisition for the sole purpose of distributing those shares in
            exchange for 11,000,000 shares of Janel common stock.

      (iii) WSD  shareholders  returned  198,076,923  shares of WSD common stock
            which WSD then  canceled,  resulting in 15,000,000 WSD common shares
            remaining issued and outstanding.

      (iv)  Janel  shareholders   exchanged  11,000,000  Janel  shares  for  the
            11,000,000 shares of WSD common stock owned by WSD Acquisition.

      (v)   On July 3, 2002,  WSD  Acquisition  and Janel merged into WSD, which
            became the surviving corporation.

      (vi)  On July 3, 2002 WSD changed its name to Janel World Trade Ltd.

      Prior to the above-mentioned  transactions,  WSD was a corporation without
      any current  business  transactions or operations,  assets or liabilities.
      Accordingly,  the  merger was  accounted  for as a reverse  purchase,  the
      effect of which was that Janel was the surviving corporation.

      The   4,000,000   shares  of  Janel  common  stock  owned  by  the  former
      stockholders  of WSD  and  others,  were  assigned  a  value  of  $250,000
      representing  the  estimated  fair  value of the WSD  public  shell.  This
      amount,  which represented the cost of the acquisition over the fair value
      of net assets  acquired,  was  attributed  to  goodwill.  The goodwill was
      subsequently  reviewed for  impairment and was written off as of September
      30, 2002.

      The Company negotiated several business acquisitions during the year ended
      September 30, 2004. In connection  therewith,  the Company  incurred legal
      and accounting fees aggregating  $119,160. As of September 30, 2004, it is
      more likely than not that these  acquisitions will not be consummated and,
      accordingly, these costs have been written off.

3     MARKETABLE SECURITIES

      Marketable securities consist of the following:

                                      Unrealized
                                       Holding
                                       (losses)
                              Cost      Gains     Fair Value
                            --------   --------    --------

As of September 30, 2004:
    Mutual Funds            $ 52,380   $ (6,243)   $ 46,137
                            ========   ========    ========

As of September 30, 2003:
    Mutual Funds            $ 52,027   $(10,934)   $ 41,093
                            ========   ========    ========
<PAGE>

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

4     LOANS RECEIVABLE - OFFICERS

      The loans  receivable - officers bear interest at 4% per annum and are due
      on demand.

5     PROPERTY AND EQUIPMENT

      A summary of property and equipment  and the  estimated  lives used in the
      computation of depreciation and amortization is as follows:

                                                  September 30,
                                              2004           2003       Life


      Furniture and fixtures                 $88,688        $ 93,296  5-7 years
      Computer equipment                     325,936         291,759  5 years
                                         -----------    ------------
                                             414,624         385,055
      Less accumulated depreciation and
          Amortization                       302,808         282,125
                                         -----------    ------------

                                            $111,816        $102,930
                                         ===========    ============

6     NOTE PAYABLE - BANK

      The Company has an available  line of credit with a bank pursuant to which
      it may borrow up to $2,000,000. Advances under this facility bear interest
      at prime plus 1/2% and are  collateralized  by substantially all assets of
      the  Company.  In  addition,  all  borrowings  under  this  agreement  are
      personally guaranteed by certain stockholders of the Company.

7     LONG-TERM DEBT

      Long-term debt consists of various  capitalized lease obligations  payable
      in monthly  installments of approximately $700 inclusive of interest at 5%
      to 11% per annum. These leases are collateralized by security interests in
      certain property and equipment.

8     STOCKHOLDERS' EQUITY

      Janel is authorized to issue 225,000,000 shares of common stock, par value
      $.001.

      See Note 2 for  information  relating to shares issued in connection  with
      acquisition, merger and issuance of common stock.

      On July 22, 2002  Janel's  Board of  Directors  agreed to and approved the
      sale of 1,801,000  shares of restricted  common stock for a purchase price
      of $.01 per share to  forty-three  employees  and five  consultants  as an
      incentive for performance.

      In October 2002 the Company  issued 42,000  unregistered  shares of common
      stock as payment for legal services.
<PAGE>

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

9     INCOME TAXES

         Income taxes consist of the following:

                                            Year Ended September 30,
                                      2004           2003            2002
                                  ------------    -----------     -----------

                Federal              $152,000       $ 93,000         $66,100
                State and local        52,600         66,500          43,400
                                  ------------    -----------     -----------

                                     $204,600       $159,500        $109,500
                                  ============    ===========     ===========


         The reconciliation of income tax computed at the Federal statutory rate
         to the provision for income taxes is as follows:


                                                    Year Ended September 30,
                                                  2004         2003      2002
                                                ---------    --------  --------

 Federal taxes (benefit) at statutory rates      $159,500    $121,000  $(3,150)
 Non-deductible expenses                           10,400       4,250    86,300
 State and local taxes, net of Federal benefit     34,700      34,250    26,350
                                                ---------    --------  --------
                                                 $204,600    $159,500  $109,500
                                                =========    ========  ========

10    PROFIT SHARING AND 401(K) PLANS

      The Company  maintains a  noncontributory  profit  sharing and 401(k) plan
      covering  substantially  all full-time  employees.  The expense charged to
      operations  for  the  years  ended  September  30,  2004,  2003  and  2002
      aggregated approximately $23,000, $22,000 and $22,500, respectively.

11    RENTAL COMMITMENTS

      The Company conducts its operations from leased  premises.  Rental expense
      on operating  leases for the years ended September 30, 2004, 2003 and 2002
      were approximately $294,000, $288,000 and $275,000, respectively.

      Future  minimum  lease  commitments   (excluding  renewal  options)  under
      noncancelable leases are as follows;


 Year ended September 30, 2005                      $290,000
                          2006                       270,000
                          2007                       230,000
                          2008                       162,000
                          2009                       145,500
                    Thereafter                       194,000


<PAGE>

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

12    RISKS AND UNCERTAINTIES

      (A)   CURRENCY RISKS

            The nature of Janel's operations requires it to deal with currencies
            other  than the U.S.  Dollar.  This  results  in the  Company  being
            exposed to the inherent risks of international  currency markets and
            governmental  interference.   A  number  of  countries  where  Janel
            maintains  offices  or agent  relationships  have  currency  control
            regulations  that  influence its ability to hedge  foreign  currency
            exposure.  The Company  tries to compensate  for these  exposures by
            accelerating international currency settlements among those officers
            or agents.

      (B)   LEGAL PROCEEDINGS

            Janel is occasionally subject to claims and lawsuits which typically
            arise in the normal  course of business.  While the outcome of these
            claims  cannot be predicated  with  certainty,  management  does not
            believe  that the outcome of any of these legal  matters will have a
            material  adverse  effect on the  Company's  financial  position  or
            results of operations.

      (C)   RELATIONSHIPS WITH OFFICERS

            Janel's  President and Chief Operating  Officer,  and Executive Vice
            President and Chief Executive  Officer ("EVP"),  respectively,  each
            own a 10% profit  interest in each of Janel  Shanghai and Janel Hong
            Kong. In addition, the EVP owns 50% of Janel Miami (Florida),  which
            is a franchise using the Janel name, but in which the Company has no
            equity or other direct economic interest.

            These  relationships   involve  actual  or  potential  conflicts  of
            interest between Janel and its officers.

13    GENERAL COMMENTS

      On December 12, 2002 the Company adopted the "Janel World Trade Ltd. Stock
      Option  Incentive  Plan" (the "Plan")  reserving  1,600,000  shares of the
      Company's $.001 par value common stock for stock options.  No options have
      been granted under this plan.

      The exercise  price of any incentive  stock option or  unqualified  option
      granted under the Option Plan may not be less than 100% of the fair market
      value of the  shares of  common  stock of the  Company  at the time of the
      grant.  In the case of incentive  stock options granted to holders of more
      than 10% of the voting power of the Company, the exercise price may not be
      less than 110% of the fair market value.