U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB
                                   -----------


                   QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

For Quarter Ended March 31, 2005                Commission File Number 000-33195
                                                                       ---------

                                XINHUA CHINA LTD.
                                -----------------
        (Exact name of small business issuer as specified in its charter)

            Nevada                                         88-0437644
            ------                                         ----------
(State or other jurisdiction of                (IRS Employer Identification No.)
incorporation or organization)

B 26F Oriental Kenzo, No. 48 Dongzhimenwai,
 Dongcheng District, Beijing, P.R. China                      100027
-------------------------------------------                   ------
  (Address of Principal Executive Offices)                  (Zip Code)

                                 86-10-84477275
                                 --------------
                           (Issuer's telephone number)

                                       N/A
                                       ---
              (Former name, former address and former fiscal year,
                          if changed since last report)


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

                                 Yes  X       No
                                    -----       -----

Applicable only to issuers involved in bankruptcy proceedings during the
preceding five years

Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court.

                                 Yes          No
                                    -----       -----

Applicable only to corporate issuers

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date. There were 61,114,375 shares as of
May 15, 2005.

Transitional Small Business Disclosure Format:

                                 Yes          No  X
                                    -----       -----


<PAGE>





                                Table of Contents
                                -----------------


PART I    FINANCIAL INFORMATION

Item 1    Financial Statements.............................................F-1

Item 2.   Management's Discussion and Analysis or Plan of Operation..........3

Item 3.   Controls and Procedures............................................7

Part II   OTHER INFORMATION

Item 1.   Legal Proceedings..................................................8

Item 2.   Unregistered Sales of Equity Securities and Use of Proceeds........8

Item 3.   Defaults Upon Senior Securities....................................8

Item 4.   Submission of Matters to a Vote of Securities Holders..............8

Item 5.   Other Information..................................................8

Item 6.   Exhibits...........................................................8

          Signatures.........................................................9





























                                        2
<PAGE>






PART I--FINANCIAL INFORMATION
-----------------------------

Item 1. Financial Statements
----------------------------




                         XINHUA CHINA LTD.
                         -----------------
                         (formerly Camden Mines Limited)


                         Consolidated Financial Statements
                         (Unaudited)
                         (Expressed in U.S. Dollars)


                         March 31, 2005


                         Index
                         -----
                         Consolidated Balance Sheets
                         Consolidated Statements of Operations
                         Consolidated Statements of Cash Flows
                         Consolidated Statements of Stockholders' Equity
                         Notes to Financial Statements





























                                       F-1
<PAGE>






<TABLE>
<CAPTION>
XINHUA CHINA LTD.
-----------------
(Formerly Camden Mines Limited)
Consolidated Balance Sheets
(expressed in U.S. dollars)
----------------------------------------------------------------------------------------
                                                        Mar. 31, 2005     Jun. 30, 2004
----------------------------------------------------------------------------------------
                                                         (Unaudited)
<S>                                                     <C>               <C>
Assets
Current Assets
   Cash                                                 $   4,803,140     $         130
   Account Receivable, net (note 3)                        54,015,594                 -
   Prepayment  (note 4)                                     8,823,217                 -
   Inventory  (note 5)                                     14,219,296                 -
----------------------------------------------------------------------------------------

Total Current Assets                                       81,861,248               130

Property, Plant and Equipment (note 6)                     25,935,260                 -
National Distribution License (note 7)                      4,325,728                 -

----------------------------------------------------------------------------------------
Total Assets                                            $ 112,122,236     $         130
========================================================================================

Liabilities and Shareholder Equity

Current Liabilities
   Loans Payable - current (note 8)                     $   1,207,837     $           -
   Account Payable                                         75,672,387             4,998
   Advance Received                                         1,042,094                 -
   Tax Provision (note 9)                                   5,160,731                 -
   Due to Related Party                                        11,503            11,503
----------------------------------------------------------------------------------------

Total Current Liabilities                                  83,094,553            16,501

Long-term Liabilities
   Loans Payable  (note 8)                                 21,101,669                 -

Total Long-term Liabilities                                21,101,669
----------------------------------------------------------------------------------------

Total Liabilities                                         104,196,222
----------------------------------------------------------------------------------------

Minority Interest                                           3,849,924
----------------------------------------------------------------------------------------

Shareholder Equity

Common Stock
   Authorized: 500,000,000 common shares with a par
     value of $0.00001 each
   Issued and outstanding 61,056,375 common shares                611               611
Additional Paid-in Capital                                  6,178,481           353,932
Share Subscriptions Received                                1,522,733
Retained Earnings                                          (3,625,734)         (370,914)
----------------------------------------------------------------------------------------

Total Shareholder Equity                                    4,076,091           (16,371)
----------------------------------------------------------------------------------------

Total Liabilities and Shareholder Equity (Deficiency)   $ 112,122,236     $         130
========================================================================================
</TABLE>

The accompanying notes are an integral part of these financial statements.
Unaudited, prepared by management

                                       F-2
<PAGE>






<TABLE>
<CAPTION>
XINHUA CHINA LTD.
-----------------
(Formerly Camden Mines Limited)
Consolidated Statements of Operations
(expressed in U.S. dollars)
-------------------------------------------------------------------------------------------------
                                                           Three Months Ended   Nine Months Ended
                                                                Mar. 31, 2005       Mar. 31, 2005
-------------------------------------------------------------------------------------------------
                                                                  (Unaudited)         (Unaudited)

<S>                                                          <C>                 <C>
Sales revenue                                                $     5,389,157     $     5,389,157
Cost of sales                                                      4,887,928           4,887,928
-------------------------------------------------------------------------------------------------
Gross profit                                                         501,229             501,229

Selling, general administrative expenses                           1,057,225           1,289,231
Stock-based compensation                                             969,216           2,567,131
Interest expense                                                      86,728              86,728
Depreciation of equipment and motor vehicle (note 2 e)                93,846              93,846
Amortization of land use right and national distribution              42,345              42,345
license (note 2 f)
-------------------------------------------------------------------------------------------------
Total operating expenses                                           2,249,360           4,079,281
-------------------------------------------------------------------------------------------------
Operating loss                                                    (1,748,132)         (3,578,053)
Interest and other income                                             15,539              15,539
-------------------------------------------------------------------------------------------------
Loss before income tax and minority interest                      (1,732,592)         (3,562,513)
Income Tax Provision                                                (162,232)           (162,232)
-------------------------------------------------------------------------------------------------
Loss before minority interests                                    (1,570,360)         (3,400,281)
Minority interests share of loss                                    (145,461)           (145,461)
-------------------------------------------------------------------------------------------------
Net Loss for the period                                      $    (1,424,899)    $    (3,254,820)
=================================================================================================
Loss per share - basic and diluted                           $         (0.02)    $         (0.05)
=================================================================================================

Weighted average number of
  common stocks outstanding
   - Basic and diluted                                            61,056,375          61,056,375
=================================================================================================
</TABLE>

The accompanying notes are an integral part of these financial statements.
Unaudited, prepared by management













                                       F-3
<PAGE>






<TABLE>
<CAPTION>
XINHUA CHINA LTD.
-----------------
(Formerly Camden Mines Limited)
Consolidated Statements of Cash Flows
(expressed in U.S. dollars)
--------------------------------------------------------------------------------------------------
                                                                 Three Months         Nine Months
                                                                        Ended               Ended
                                                                Mar. 31, 2005       Mar. 31, 2005
--------------------------------------------------------------------------------------------------

<S>                                                           <C>                 <C>
Cash flows from (used in) operating activities
Net (loss) for the period                                     $    (1,424,899)    $    (3,254,820)
Adjustments to reconcile net (loss) to net cash
  used by operating activities:
- stock-based compensation                                            969,216           2,567,131
- depreciation of equipment                                            93,846              93,846
- amortization of land use right and license                           42,345              42,345
- income tax provision                                               (162,232)           (162,232)
- minority interest share of loss                                    (145,461)           (145,461)
Change in working capital accounts:
- account receivable                                              (54,015,594)        (54,015,594)
- inventory                                                       (14,219,296)        (14,219,296)
- prepayment                                                       (8,823,217)         (8,823,217)
- account payable                                                  75,501,600          75,667,389
- advance received                                                  1,042,094           1,042,094
- tax provision                                                     5,160,731           5,160,731
--------------------------------------------------------------------------------------------------
Net cash provided by operating activities                           4,019,133           3,952,916
--------------------------------------------------------------------------------------------------

Cash flows from (used in) financing activities
- notes payable                                                     1,207,837           1,207,837
- Long-term Loan                                                   13,044,644          13,044,644
- Long-term Bank Loan                                               4,831,350           4,831,350
- Loans from Shareholders                                           3,225,675           3,225,675
- Additional Paid-in Capital                                        6,178,476           6,178,476
- Adjustment to minority interest                                           -             350,429
- Share Subscriptions Received                                      1,522,733           1,522,733
--------------------------------------------------------------------------------------------------
Net cash provided by financing activities                          30,010,715          30,361,144
--------------------------------------------------------------------------------------------------

Cash flows from (used in) investing activities
 - Cash acquired in connection with acquisition of Boheng             774,104             774,104
 - Equipment and machinery                                           (607,069)           (513,223)
 - Construction in progress                                       (19,986,605)        (19,986,605)
 - Land Use Right                                                  (5,477,778)         (5,435,433)
 - National Distribution License                                   (4,349,894)         (4,349,894)
--------------------------------------------------------------------------------------------------
Net cash provided by investing activities                         (29,647,241)        (29,511,050)
--------------------------------------------------------------------------------------------------

Increase (decrease) in cash and cash equivalents                    4,382,606           4,803,010

Cash and cash equivalents, beginning of period                        420,534                 130

Cash and cash equivalents, end of period                      $     4,803,140     $     4,803,140
</TABLE>



The accompanying notes are an integral part of these financial statements.
Unaudited, prepared by management

                                       F-4
<PAGE>






<TABLE>
<CAPTION>
XINHUA CHINA LTD.
-----------------
(Formerly Camden Mines Limited)
Consolidated Statements of Stockholders' Equity
(expressed in U.S. dollars)

-----------------------------------------------------------------------------------------------------------------------------------
                                                                                                                          Total
                                               Common Stock                  Additional   Accumulated   Subscription  Shareholders'
                                                                              Paid-in       Deficit       Received       Equity
                                                 # Shares        Amount       Capital                                   (Deficit)
                                                                   $             $             $             $              $
-----------------------------------------------------------------------------------------------------------------------------------

<C>                                           <C>             <C>           <C>           <C>           <C>           <C>
Balance-September 14, 1999                                -             -             -             -                            -
(Date of Inception)

Issuance of common stock for services and
in payment of advances for approximately
$0.055 per share                                 75,000,000           750       274,250             -                      275,000

Cancellation of common stock by directors
for services and payment of advances for
approximately $0.055 per share                  (30,000,000)         (300)     (109,700)            -                     (110,000)

Issuance of common stock for services and
in payment of advances for approximately
$0.055 per share                                 22,500,000           225        82,275             -                       82,500

Net loss for period                                       -             -             -      (264,475)                    (264,475)
                                              -------------------------------------------------------------------------------------

Balance-June 30, 2000                            67,500,000           675       246,825      (264,475)                     (16,975)

Sale of common stock for cash
at $0.10 per share                               16,056,375           161       106,882             -                      107,043















                                       F-5
<PAGE>






<CAPTION>
-----------------------------------------------------------------------------------------------------------------------------------
                                                                                                                          Total
                                               Common Stock                  Additional   Accumulated   Subscription  Shareholders'
                                                                              Paid-in       Deficit       Received       Equity
                                                 # Shares        Amount       Capital                                   (Deficit)
                                                                   $             $             $             $              $
-----------------------------------------------------------------------------------------------------------------------------------

<C>                                           <C>             <C>           <C>           <C>           <C>           <C>
Cancellation of common stock returned
for services and payment of advances            (22,500,000)         (225)          225             -                            -

Net loss for the year                                     -             -             -       (58,677)                     (58,677)
                                              -------------------------------------------------------------------------------------

Balance-June 30,2001                             61,056,375           611       353,932      (323,152)                      31,391
Net loss for the year                                     -             -             -       (23,521)                     (23,521)
                                              -------------------------------------------------------------------------------------

Balance - June 30, 2002                          61,056,375           611       353,932      (346,673)                       7,870
Net loss for the year                                     -             -             -       (16,806)                     (16,806)
                                              -------------------------------------------------------------------------------------

Balance - June 30, 2003                          61,056,375           611       353,932      (363,479)                      (8,936)
Net loss for the year                                     -             -             -        (7,435)                      (7,435)
                                              -------------------------------------------------------------------------------------

Balance - June 30, 2004                          61,056,375           611       353,932      (370,914)                     (16,371)

Recapitalization as a result of reverse
   acquisition                                   35,000,000           350     6,027,437                                  6,053,337
Cancelation of common stock as part of
   reverse acquisition                          (35,000,000)         (350)     (202,888)                                  (203,238)
Net loss for period ended Mar.31, 2005                                                     (3,254,820)                  (3,254,820)
Subscription received                                                                                     1,522,733      1,522,733
                                              -------------------------------------------------------------------------------------

Balance, March 31, 2005                          61,056,375           611     6,178,481    (3,625,734)    1,522,733      4,076,091
                                              =====================================================================================
</TABLE>



The accompanying notes are an integral part of these financial statements.
Unaudited, prepared by management









                                       F-6
<PAGE>






1.   Nature of Business and Basis of Presentation
-------------------------------------------------

     The  consolidated  financial  statements  are those of Xinhua  China  Ltd.,
     formerly  Camden  Mines  Limited,   ("parent  company'),   its  100%  owned
     subsidiary  Pac-Poly  Investments  Limited  ("Pac-Poly"),   its  95%  owned
     subsidiary Beijing Boheng Investments Ltd. ("Boheng"), and its 56.13% owned
     subsidiary  Xinhua  Publications   Circulation  &  Distribution  Co.,  Ltd.
     ("Xinhua  C&D").  Pac-Poly and Boheng jointly own 57.67% interest in Xinhua
     Publications  Circulation & Distribution  Co., Ltd. ("Xinhua C&D"), a newly
     formed company  organized under the laws of the People's  Republic of China
     on December 31, 2004. Collectively, the parent company and its subsidiaries
     are referred as the "Company".

     On January 21, 2005,  the Company  completed  two separate  Share  Purchase
     Agreements  acquiring all of the outstanding shares of Pac-Poly Investments
     Limited  ("Pac-Poly")  and 95% of the outstanding  shares of Beijing Boheng
     Investments  Ltd.  ("Boheng").  The  shareholders  of  Pac-Poly,  a company
     organized under the laws of the British Virgin Islands, received 16,387,000
     shares of the  Company's  common stock and the  shareholders  of Boheng,  a
     company  organized  under  the  laws of the  People's  Republic  of  China,
     received  18,613,000  shares of the Company's  common stock. As part of the
     acquisition,  a shareholder of the Company  cancelled  35,000,000 shares of
     common  stock  of  the  Company.  The  acquisition  was  accounted  for  as
     recapitalization  of Xinhua  C&D  because  the  shareholders  of Xinhua C&D
     controlled  the  parent  company  after the  acquisition.  The  issued  and
     outstanding  common  stock  of  Xinhua  C&D  prior  to  the  completion  of
     acquisition  was  restated to reflect the  35,000,000  stock  issued by the
     parent company.

     Xinhua C&D has been granted a nationwide  distribution license in China for
     books, periodicals,  human figure and representation art pictorials,  audio
     video product  distribution,  wholesale,  retail and mail order of publicly
     distributed electronic publications,  advertisement by domestic and foreign
     firms in certain categories of books; and classified ads.

2.   Significant Accounting Policies
------------------------------------

     a)   Base of Presentation

          These  consolidated  financial  statements include the accounts of the
          parent  company,  its 56.13%  owned  subsidiary,  Xinhua  Publications
          Circulation  and  Distribution  Co. Ltd.,  its 100% owned  subsidiary,
          Pac-Poly Investments  Limited,  and its 95% owned subsidiary,  Beijing
          Boheng  Investments  Ltd. All significant  inter-company  transactions
          have been eliminated.

     b)   Use of Estimates

          The  preparation of financial  statements in conformity with generally
          accepted   accounting   principles  in  the  United  States   requires
          management to make estimates and assumptions  that affect the reported
          amounts of assets and liabilities and disclosure of contingent  assets


                                       F-7
<PAGE>






          and  liabilities  at the  date  of the  financial  statements  and the
          reported amounts of revenues and expenses during the reporting period.
          Actual results could differ from those estimates.

     c)   Cash and Cash Equivalents

          Cash equivalents usually consist of highly liquid investments that are
          readily  convertible  to cash with  maturities of three months or less
          when purchased.

     d)   Inventories

          Inventories  are  stated  at the  lower of cost or  market  with  cost
          generally determined on a weighted moving average basis.

     e)   Property and Equipment

          Property and equipment are recorded at cost. Significant additions and
          improvements  are  capitalized,  while  repairs  and  maintenance  are
          charged  to  expenses  as  incurred.   Depreciation  of  property  and
          equipment  generally is computed using the straight-line  method based
          on the estimated useful lives of the assets as follows:

             Motor vehicles                                10 years
             Equipment and machinery                       5 years
             Land-use rights                               50 years
             Plant (construction in progress)              50 years

     f)   Licenses and Permits

             National Distribution License                 30 years


          Licenses  and permits in relation  to the right to  distribute  books,
          periodicals,  human figure and  representation  art pictorials,  audio
          video  product  distribution,  wholesale,  retail  and  mail  order of
          publicly  distributed   electronic   publications,   advertisement  by
          domestic  and  foreign  firms  in  certain  categories  of  books  and
          classified  ads in China are amortized on a  straight-line  basis over
          the life of the right to use the license and permits.  Carrying values
          of such assets are reviewed at least  annually and whatever  events or
          changes in  circumstances  indicate that the carrying value may not be
          recoverable  from future  undiscounted  net cash flows  expected to be
          generated  by the  asset.  If the asset is not fully  recoverable,  an
          impairment  loss would be recognized  for the  difference  between the
          carrying  value of the asset and its  estimated  fair  value  based on
          discounted net future cash flows or quoted market values.

     g)   Impairment of Long-Lived Assets

          The Company has adopted  Statement of Financial  Accounting  Standards
          ("SFAS")  No.  144  "Accounting  for the  Impairment  or  Disposal  of



                                       F-8
<PAGE>






          Long-Lived Assets". Long-lived assets and intangible assets subject to
          amortization are reviewed for impairment whenever events or changes in
          circumstances indicate that the carrying value of the asset may not be
          recoverable  from the future,  undiscounted net cash flows expected to
          be generated by the asset. If the asset is not fully  recoverable,  an
          impairment  loss would be recognized  for the  difference  between the
          carrying  value of the asset and its  estimated  fair  value  based on
          discounted net future cash flows or quoted market  prices.  There have
          been no impairment losses recognized to date.

     h)   Income Taxes

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

     i)   Revenue Recognition

          Sales revenue is recognized when persuasive evidence of an arrangement
          exists, the price is fixed and final,  delivery has occurred and there
          is  reasonable  assurance of  collection  of the sales  proceeds.  The
          Company generally obtains purchase  authorizations  from its customers
          for a specified  amount of products at a specified price and considers
          delivery to have  occurred when the customer  takes  possession of the
          products.  The Company  provides its customers with a limited right of
          return.  Revenue is  recognized  upon delivery and a reserve for sales
          returns is recorded.  The Company has demonstrated the ability to make
          reasonable  and reliable  estimates of products  returns in accordance
          with SFAS No. 48, Revenue Recognition When Right of Return Exists.

     j)   Foreign Currency Transactions

          The parent  company and its  subsidiaries  maintain  their  accounting
          records in their functional currencies, i.e. U.S. dollars and Renminbi
          Yuan ("RMB")  respectively.  The Company  translates  foreign currency
          transactions into its functional currency in the following manner:

          At the transaction date, each asset, liability, revenue and expense is
          translated  into the  functional  currency by the use of the  exchange
          rate in effect at that  date.  At the  period  end,  foreign  currency
          monetary assets,  and liabilities are re-evaluated into the functional
          currency by using the  exchange  rate in effect at the  balance  sheet
          date. The resulting  foreign exchange gains and losses are included in
          operations.

          The  assets  and  liabilities  of  the  foreign  subsidiaries,  Xinhua


                                       F-9
<PAGE>






          Publications  Circulation &  Distribution  Co. Ltd. and Beijing Boheng
          Investments Ltd is Renminbi Yuan, are translated into U.S.  dollars at
          exchange  rates in effect  at the  balance  sheet  date.  Revenue  and
          expenses are translated at average exchange rate. Gain and losses from
          such translations are included in stockholders' equity, as a component
          of other comprehensive income.

     k)   Stock-based Compensation

          The  Company  has  adopted  the fair value  method of  accounting  for
          stock-based  compensation  recommended  by of  Statement  of Financial
          Accounting  Standards No. 123 (SFAS 123),  "Accounting for Stock-based
          Compensation".

     l)   Comprehensive Income

          The  Company  has  adopted  SFAS  No.  130,  "Reporting  Comprehensive
          Income",  which  establishes  standards  for  reporting and display of
          comprehensive  income,  its components and accumulated  balances.  The
          Company  is   disclosing   this   information   on  its  Statement  of
          Stockholders'  Equity. The Company's  comprehensive income consists of
          net earnings (loss) and foreign currency translation adjustments.

     m)   Earnings (Loss) Per Share

          Basic earning (loss) per share is computed using the weighted  average
          number of shares  outstanding  during the period.  The Company adopted
          SFAS No. 128, "Earnings per Share".

     n)   Financial Instruments and Concentration of Credit Risks

          The fair values of financial  instruments  are estimated at a specific
          point in time, based on relevant  information  about financial markets
          and specific financial instruments.  As these estimates are subjective
          in  nature,   involving   uncertainties  and  matters  of  significant
          judgment,  they  cannot  be  determined  with  precision.  Changes  in
          assumptions can significantly affect estimated fair values.

          The carrying value of cash and cash equivalents,  accounts receivable,
          short-term  loans payable,  accounts  payable and accrued  liabilities
          approximate their fair value because of the short-term nature of these
          instruments.  The  fair  value  of  long-term  debt  is  based  on the
          discounted  value of  contractual  cash flows.  The  discount  rate is
          estimated  using the rates  currently  offered  for debt with  similar
          remaining maturities.

          The Company is operating in China,  which may give rise to significant
          foreign currency risks from  fluctuations and the degree of volatility
          of foreign  exchange rates between US dollars and the Chinese currency
          RMB.  Financial  instruments that  potentially  subject the Company to
          concentration  of credit risks consist  principally  of cash and trade
          receivables,  the  balances  of which are  stated on the  consolidated



                                      F-10
<PAGE>






          balance  sheets.  The Company  places its cash in high credit  quality
          financial institutions.  Concentration of credit risks with respect to
          trade  receivables  is limited to a degree due to the Company's  large
          number of diverse customers in different  locations in China.  Ongoing
          credit evaluations of customers' financial condition are performed and
          the  Company  maintains  provision  for  potential  credit  losses  if
          necessary.  The Company does not require  collateral or other security
          to support financial instruments subject to credit risks.

     o)   Accounting for Derivative Instruments and Hedging Activities

          The  Company  has  adopted  the  Statement  of  Financial   Accounting
          Standards No. 133 (SFAS 133),  Accounting for  Derivative  Instruments
          and Hedging  Activities,  which  requires  companies to recognize  all
          derivatives  contracts as either assets or  liabilities in the balance
          sheet and to measure  them at fair value.  If certain  conditions  are
          met, a  derivative  may be  specifically  designated  as a hedge,  the
          objective of which is to match the timing of gain or loss  recognition
          on the hedging  derivative  with the recognition of (i) the changes in
          the fair value of the hedged asset or liability that are  attributable
          to the  hedged  risk  or  (ii)  the  earnings  effect  of  the  hedged
          forecasted  transaction.  For a derivative not designated as a hedging
          instrument,  the gain or loss is recognized in income in the period of
          change.

          The Company has not entered into derivative  contracts either to hedge
          existing  risks  or for  speculative  purposes.  The  option  of  this
          pronouncement  does not have an impact on its  consolidated  financial
          statements.

     p)   New Accounting Pronouncements

          In a December 11, 2003 speech at the  American  Institute of Certified
          Public  Accountants,  the Securities and Exchange  Commission  ("SEC")
          expressed that  rate-lock  commitments  represent  written put options
          and, therefore, be valued as a liability.  The SEC expressed that they
          expect  registrants to disclose the effect on the financial  statement
          of recognizing the rate-lock  commitments as written put options,  for
          quarters  commencing  after  March  15,  2004.  Additionally,  the SEC
          recently issued Staff  Accounting  Bulletin (SAB) No. 105. SAB No. 105
          clarifies  the SEC's  position  that the  inclusion of cash flows from
          servicing or ancillary  income in the  determination of the fair value
          of interest rate lock commitments is not appropriate.  The adoption of
          SAF No.  105 does not have an  impact  on the  Company's  consolidated
          financial statements.

          In November 2004, the FASB issued SFAS No. 151,  "Inventory  Costs--an
          amendment of ARB No. 43, Chapter 4", which is the result of the FASB's
          project  to  reduce   differences   between  U.S.  and   international
          accounting  standards.  SFAS No. 151  requires  idle  facility  costs,
          abnormal  freight,  handling  costs,  and amounts of wasted  materials
          (spoilage) be treated as current-period  costs. Under this concept, if
          the costs  associated  with the actual level of spoilage or production



                                      F-11
<PAGE>






          defects are greater than the costs associated with the range of normal
          spoilage or defects, the difference would be charged to current-period
          expense,  not  included  in  inventory  costs.  SFAS  No.  151 will be
          effective for inventory  costs incurred  during fiscal years beginning
          after  June 15,  2005.  The  adoption  of SFAS No. 151 does not have a
          material impact on the Company's consolidated financial statements.

          In December  2004, the FASB issued SFAS No.  123(R),  "Accounting  for
          Stock-Based  Compensation".  SFAS 123(R) establishes standards for the
          accounting for  transactions  in which an entity  exchanges its equity
          instruments for goods or services. This Statement focuses primarily on
          accounting  for  transactions  in which  an  entity  obtains  employee
          services in share-based  payment  transactions.  SFAS 123(R)  requires
          that the fair  value  of such  equity  instruments  be  recognized  as
          expense  in  the  historical  financial  statements  as  services  are
          performed. Prior to SFAS 123(R), only certain pro-forma disclosures of
          fair value were  required.  SFAS  123(R)  shall be  effective  for the
          Company as of the beginning of the first  interim or annual  reporting
          period that begins after  December 15, 2005.  The adoption of this new
          accounting  pronouncement  does not have an  impact  on the  Company's
          consolidated financial statements.


3.   Accounts Receivable
------------------------

                                                           March 31, 2005
          ----------------------------------------------------------------
          Trade receivables                                $  54,146,005
          Allowance for doubtful accounts                       (130,411)
          ----------------------------------------------------------------

          Total                                            $  54,015,594
          ================================================================


4.   Prepayment
---------------

     Prepayment of $8,823,217 was made to publishers for books and  publications
     ordered.


5.   Inventory
--------------

                                                           March 31, 2005
          ----------------------------------------------------------------
          Books & publications                             $   14,198,322
          Packaging materials                                      20,974
          ----------------------------------------------------------------

          Total                                            $   14,219,296
          ================================================================


6.   Property, Plant, and Equipment
-----------------------------------

                                                   March 31, 2005
                                     -------------------------------------------
                                                     Accumulated        Net book
                                            Cost    Amortization           Value
     ---------------------------------------------------------------------------
     Equipment and machinery         $ 1,208,483       $ 809,731    $    398,753
     Motor vehicles                      310,473         196,004         114,470




                                      F-12
<PAGE>






     Construction in progress         19,986,605               -      19,986,605
     Land Use Right                    5,453,612          18,179       5,435,433
     ---------------------------------------------------------------------------
     Total                           $26,959,173      $1,023,913    $ 25,935,260
     ===========================================================================

     The  construction in progress is a warehouse,  office,  and retail complex.
     The construction phase has been completed and the final inspection approval
     by the local government is in process.


7.   National Distribution License
----------------------------------

                                                     March 31, 2005
                                        ----------------------------------------
                                                      Accumulated       Net book
                                            Cost     Amortization          Value
     ---------------------------------------------------------------------------
     National Distribution License    $4,349,894          $24,166    $ 4,325,728
     ---------------------------------------------------------------------------
     Total                            $4,349,894          $24,166    $ 4,325,728
     ===========================================================================

     The  national  distribution  license  is  acquired  as part of  acquisition
     transaction.  The  license  will be valid  for a period  of 30 years and is
     amortized  over the life of the license.  The carrying value of the license
     will be reviewed by the management for impairment test.


8.   Loans Payable
------------------

                                                                 March 31, 2005
     ---------------------------------------------------------------------------
     Bank loan: RMB10,000,000, unsecured, bearing interest       $    1,207,837
     at 0.36% per month and due on demand. The loan was not
     secured.
     ---------------------------------------------------------------------------
     Total loan payable - current                                $    1,207,837
     ===========================================================================

     Bank loan: RMB40,000,000, bearing interest at 0.465%        $    4,831,350
     per month and due on March 30, 2008.

     Related Party Loans:
          Loans from Xinhua Bookstore Head Office:
          RMB85,000,000, unsecured, bearing interest at              10,266,618
          0.4785% per month and due on July 30, 2006
          RMB23,000,000, unsecured ,bearing interest at               2,778,026
          5.31% per annum and due on July 30, 2006.

          Long-term loan from a shareholder:
          RMB20,000,000, unsecured, non-interest bearing and          2,415,675
          due on July 31, 2006

          Long-term loan from a shareholder:
          USD810,000, unsecured, non-interest bearing not               810,000
          secured and due on July 31, 2006
     ---------------------------------------------------------------------------
     Total Related Party Loans:                                  $   16,270,319
     ===========================================================================

     ===========================================================================
      Total loan payable - long-term                             $   21,101,669
     ===========================================================================




                                      F-13
<PAGE>






9.   Tax Provision
------------------

     The  Company has  deferred  tax  liability  of  $5,160,731  due to previous
     realized sales.


10.  A Related Party Transaction
--------------------------------

     The former  President  of the Company is owed  $11,503 as at March 31, 2005
     for  payment  of  expenses  on  behalf  of  the  Company.  This  amount  is
     non-interest bearing, unsecured and due on demand.

     Loans payable from related parties total $16,270,319 (note 8).


11.  Income Taxes
-----------------

     Xinhua  C&D is subject to income  taxes in China on its  taxable  income as
     reported in its statutory  accounts at a tax rate of 33% in accordance with
     the  relevant  income tax laws.  No income taxes were charged to Xinhua C&D
     for the nine months ended March 31, 2005. The parent company is not subject
     to income taxes.

     The potential  tax benefits  arising from the losses have not been recorded
     in the financial statements.  The Company evaluates its valuation allowance
     requirements on an annual basis based on projected future operations.  When
     circumstances  change and this  causes a change in  management's  judgement
     about the realizability of deferred tax assets, the impact of the change on
     the valuation allowance is generally reflected in current income.


12.  Stock Option Plan
----------------------

     The board of directors  approved a Stock Option Plan (the "Plan") effective
     on September 4, 2004 pursuant to which directors,  officers,  employees and
     consultants  of the Company are  eligible to receive  grants of options for
     the  Company's  common  stock.  The plan has a life of ten (10)  years  and
     expires on September 4, 2014. A maximum of  20,000,000  common  shares have
     been  reserved  under the plan.  Each stock  option  entitles its holder to
     purchase one common share of the Company. Options may be granted for a term
     not exceeding ten years from the date of grant. The plan is administered by
     the board of directors.

     On September 23, 2004,  4,100,000 stock options under the Plan were granted
     to its directors,  officers,  employees and  consultants  with the exercise
     price of $2.40 per share,  being the market price at the time of the grant.
     These  options vest at  different  periods from 18 months to 27 months from
     the date of grant depending on the optionee and all of these options have a
     life of five (5) years from the grant date.

     On October 1, 2004 and October 23, 2004, a total of 180,000  stock  options
     under the Plan were granted to its consultants  with the exercise prices of






                                      F-14
<PAGE>






     $2.62 and $3.05 per share respectively,  being the market price at the time
     of the grant. These options vest from October 2004 to October 2005 and have
     a life of about one (1) year from the grant date.

     On February 14, 2005, a total of 20,000 stock  options  under the Plan were
     granted to a consultant with the exercise prices of $4.70, being the market
     price at the time of the grant.  These  options vest from  February 2005 to
     July  2006 and have a life of about  one and a half  (1.5)  years  from the
     grant date.

     The Company charged  $2,567,131  stock-based  compensation to operations in
     the nine months  ended March 31, 2005 by applying  the fair value method in
     accordance  with SFAS No. 123. The fair value of the stock options  granted
     for the nine months ended March 31, 2005 was  estimated at $1.54 per share,
     using the  Black-Scholes  Option Pricing Model with the following  weighted
     average  assumptions:  risk-free interest rate of 3.20%,  dividend yield of
     0%, volatility of 80% and expected lives of 4.63 years.

     The following is a summary of the stock option  information  for the period
     ended March 31, 2005.

                                                   Shares      Weighted Average
                                                                 Exercise Price
--------------------------------------------------------------------------------
Options outstanding at June 30, 2004                      -         $    -

Granted                                           4,100,000         $ 2.40

Options outstanding at September 30, 2004         4,100,000         $ 2.40

Granted                                             180,000         $ 2.91

Forfeited                                          (45,000)         $ 2.62

Options outstanding at December 31, 2004          4,235,000         $ 2.42

Granted                                              20,000         $ 4.70

Options outstanding at March 31, 2005             4,255,000         $  2.43

     As at March 31, 2005, 1,656,000 (December 31, 2004 1,033,750) stock options
     were  exercisable  and  there  was  $4.9  million  of  total   unrecognized
     compensation   cost   related  to   non-vested   share-based   compensation
     arrangements granted under the Plan. That cost is expected to be recognized
     over a weighted average period of 1.31 years.

     The following table shows the assumptions  used in determining  stock-based
     compensation costs under the Black-Scholes option pricing model:






                                      F-15
<PAGE>






                                                            March 31, 2005
     ---------------------------------------------------------------------

     Expected volatility                                            80.0%

     Risk-free interest rate                                         3.2%

     Expected life (years)                                           4.63

     Dividend yield                                                   Nil

     Number of stock options outstanding                        4,255,000
     ---------------------------------------------------------------------

     Weighted average fair value of options granted                 $1.54
     ---------------------------------------------------------------------


13.  Segmented Information
--------------------------

     The Company operates  exclusively in the publication  distribution  sector.
     The Company's business is considered as operating in one segment based upon
     the Company's  organizational  structure, the way in which the operation is
     managed and evaluated,  the availability of separate  financial results and
     materiality  considerations.  All the revenues are generated in China.  The
     Company's assets by geographical location are as follows:

                                                            March 31, 2005
     ---------------------------------------------------------------------
     Assets

     North America                                                $97,399
     China                                                    112,024,837
     ---------------------------------------------------------------------
     Total                                                  $ 112,122,236
     =====================================================================


14.  Distribution of Profit
---------------------------

     Pursuant to Chinese company law applicable to foreign investment companies,
     the Company's  subsidiaries,  Xinhua C&D is required to maintain  dedicated
     reserves, which include a general reserve and an enterprise expansion fund.
     The dedicated  reserves is to be appropriated  from net income after taxes,
     determined  under the relevant  Chinese  accounting  regulations  at a rate
     determined  by the  board of  directors  of  respective  subsidiaries,  and
     recorded as a component of shareholders' equity. The dedicated reserves are
     not distributable other than upon liquidation. Pursuant to the same Chinese
     company law, the Company's  subsidiaries  are required to transfer,  at the
     discretion  of its board of  directors,  certain  amount of its  annual net
     income  after taxes as  determined  under the relevant  Chinese  accounting
     regulations to a staff welfare and bonus fund.


15.  Non Cash Transactions
--------------------------

     In January  2005,  the  Company  issued  16,387,000  common  shares for the
     acquisition  of all of  the  outstanding  shares  of  Pac-Poly  Investments
     Limited   ("Pac-Poly")  and  issued   18,613,000   common  shares  for  the
     acquisition of 95% of the outstanding  shares of Beijing Boheng Investments
     Ltd. ("Boheng").



                                      F-16
<PAGE>






16.  Common Stock
-----------------

     Prior to March 31,  2005,  the Company has offered a private  placement  to
     certain  individuals.  As of March 31,  2005,  the Company has received net
     proceeds of $1,522,733.  Each unit consists of one share of common stock at
     $3.25  per  share  and  one-half  of one  non-transferable  share  purchase
     warrant. The warrants will expire on the earlier of:

          two years from the date of issuance; and

          fifteen  business days from date that the Company  provides  notice in
          writing to the subscriber  that the Company's  common shares have been
          trading  or traded at a price of  US$7.00  or more for a period of ten
          days.

     The  warrant  shares  shall have an  exercise  price of US$4.50 per warrant
     share for the first  twelve  months,  and if still  available  after twelve
     months,  the warrant  shares  shall have an  exercise  price of US$4.60 per
     warrant  share  starting on the first day of the second twelve month period
     and  increasing  by  US$0.10  on the  first  day of each  subsequent  month
     thereafter until expiration of the warrants.


17.  Subsequent events
----------------------

     a)   Three individuals, two of whom are directors of the Company, exercised
          in aggregate  58,000 stock options in April and May at prices  between
          $2.40 per share for total proceeds of $139,200.  Such proceeds will be
          used for working capital and have not yet been expended.

     b)   Through Pac-Poly, a 100% owned subsidiary,  the Company has executed a
          letter of intent with the County  Government  of  Xihongmen  District,
          Beijing  China on March 15, 2005,  for the right to use  approximately
          128 acres of land for a period of 50 years.  The land in Beijing  will
          be  used  as a site  for  the  phased  development  of a  new,  larger
          distribution  and commercial  center.  This transaction is part of the
          Company's  strategic  plan to ensure it has the  capacity  to meet the
          needs of the  anticipated  explosive  growth in  demand  for books and
          other  publications  in China over the next  several  years.  The land
          lease transaction was initially executed between the County Government
          of Xihongmen  District and Bangsheng  Investments Co., Ltd.  Bangsheng
          subsequently  assigned  the  lease to  Pac-Poly,  a 100  percent-owned
          subsidiary  of the  Company.  The terms of the lease  call for  annual
          lease  payments  to the  County  Government  of  approximately  $US1.9
          million for the first five years of the lease, $US2.2 million in years
          6 through 10, and $US2.4 million in years 11 through 50.

     c)   Subsequent  to March 31,  2005,  additional  proceeds of $500,500  was
          received for the  subscription  of 154,000 units at the price of $3.25
          per unit (see note 16).











                                      F-17
<PAGE>






Item 2. Management's Discussion and Analysis or Plan of Operation
-----------------------------------------------------------------

The following  discussions of our results of operations  and financial  position
should be read in conjunction with the financial statements and notes pertaining
to them that appear elsewhere in this Form 10-QSB.

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

On March 31, 2005, the Company had a working  capital  deficiency of $1,233,305.
The Company has remained  solvent due to funding from its  shareholders.  During
the next year following the date of this report, the Company anticipates that it
will have to raise capital in the form of equity  financing from the sale of its
common  stock.  However,  the Company  does not have  financing  arranged and it
cannot provide investors with assurance that it will be able to raise sufficient
funding  from the sale of its common stock to fund its  anticipated  business in
China.  In the absence of such timely  financing,  the  Company's  business plan
could well be subject to adjustment.

The Company  completed its due diligence with respect to the acquisition of 100%
of  Pac-Poly   Investments  Limited  ("Pac-Poly")  and  95%  of  Beijing  Boheng
Investments  Ltd.  ("Boheng")  in  January  2005.  After  operations,   physical
properties,  intangibles,  contracts and licenses were reviewed by the Company's
accountants,  lawyers in China, and  contractors,  the Board of Directors of the
Company  decided to proceed and complete the  acquisition  of the two  companies
that hold a 57.67%  interest of Xinhua  Publications  Circulation & Distribution
Co., Ltd.  ("Xinhua C & D"); this became  effective on January 21st. As a result
the  shareholders  of  Pac-Poly  and Boheng  received  in  aggregate  35,000,000
restricted shares of the Company's common stock and our President,  Mr. Xianping
Wang, surrendered 35,000,000 common shares of the Company registered in his name
to the Company for cancellation and return to treasury.

The financial  statements with this 10-QSB filing are the first that the Company
has produced  that are  consolidated  with the two  subsidiaries  (Pac-Poly  and
Boheng)  and include  the  operations  of the new  operating  subsidiary  Xinhua
Publications  Circulation  and  Distribution  Co.,  Ltd  ("Xinhua  C&D") For the
foreseeable  future, the earnings of the Company will most likely be exclusively
derived from Xinhua C&D. The subsidiary  began legal  existence on February 1st,
2005 and this quarter's  report reflects the operating  results of less than one
month.

Xinhua  C&D  currently  serves  12,800  affiliated  bookstores  as  well as many
independent  outlets  in China for their  book  needs.  Xinhua  C&D also has the
ability to  distribute  newspapers,  periodicals,  and  electronic  publications
should it so choose.

On March 15th, 2005 the Company  announced that through a subsidiary  company it
had  executed  a letter  of  intent  with the  County  Government  of  Xihongmen
District,  Beijing  for the right to use  approximately  128 acres of land for a
period of 50 years.  The land in  Beijing  will be used as a site for the phased
development  of  a  new,  larger   distribution  and  commercial  center.   This
transaction is part of Xinhua C&D's strategic plan to ensure it has the capacity



                                        3
<PAGE>






to meet the needs of the  anticipated  explosive  growth in demand for books and
other publications in China over the next several years.

The land lease transaction was initially  executed between the County Government
of Xihongmen District and Bangsheng Investments Co., Ltd. Bangsheng subsequently
assigned the lease to Pac-Poly, a 100 percent-owned  subsidiary of Xinhua China.
The terms of the lease call for annual lease  payments to the County  Government
of  approximately  $US1.9 million for the first five years of the lease,  $US2.2
million in years 6 through 10, and $US2.4 million in years 11 through 50.

When  complete  the project  will  include  over 5 million  square feet of space
including approximately 1.5 million square feet of distribution space for Xinhua
C&D. It will also have space for use by various book publishers and a commercial
center  including a large "book city" retail  operation,  office space and other
businesses.

Development of the first phase of the project,  beginning early in the summer of
2005 will involve the  construction  of a 500,000 square foot  facility,  and is
scheduled for completion  late in 2005.  Phase II of the project is slated to be
completed in mid-2006 and will include  approximately 1.5 million square feet of
distribution  space.  Xinhua  plans to use this  part of the  center  as its own
distribution facility. It will allow Xinhua to offer more efficient distribution
to publishers than they could achieve on their own.

The third phase is scheduled for completion in 2007. The space will  incorporate
the large "Book City"  retail  bookstore  as well as shops,  restaurants  and an
office tower.  Ultimately,  Xinhua  expects to construct six large  distribution
facilities throughout China.

The Company's goal is to modernize and expand retail book  distribution in China
on a national scale,  maximize  opportunities  in one of the largest and fastest
growing economies in the world through the only existing national license in the
country.  Xinhua's nationwide license gives worldwide  publishers the ability of
distribution  of their  publications  nationwide  through China rather than seek
approval in each province.

A formal ceremony  introducing  its operating  subsidiary  (Xinhua  Publications
Circulation and Distribution Co., Ltd), to the Chinese book industry was held in
Beijing  on April 24 at the Great  Hall of the  People.  The date was  chosen to
coincide  with the founding of the original  Xinhua  Bookstore,  68 years ago on
April 24th,  1937.  Attending were senior  officials of the Chinese  government,
Xinhua  China Ltd.  and Xinhua  C&D  management,  the  company's  investors  and
numerous representatives of the Chinese book industry.

In May Xinhua retained the Beijing Ying Ke Law Firm to assist in the preparation
of a co-publishing  agreement.  Ying Ke Law Firm is one of China's leading legal
firms specializing in intellectual properties,  business and commercial law, and
the Company  believes  that  diversifying  into  co-publishing  agreements  with
foreign  publishers and distributors is a solid adjunctive  strategy to its goal
of expanding  the wealth of titles  available to the  literature-hungry  Chinese
reading public.



                                        4
<PAGE>






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

Revenue of  $5,389,157  was  generated  during the quarter ended March 31, 2005.
This quarter  included the results of less than one month's  operations,  as our
subsidiary  Xinhua C&D only became a legal  entity in the PRC on  February  1st,
2005. There were no other  revenue-generating  operations other than this and so
the  revenue  figure for the quarter  and the  nine-month  period were the same.
Although we had a gross  profit of  $501,229,  sales and general  administrative
expenses  substantially  exceeded  this.  We believe  that these  expenses  will
continue to be high (in contrast to our internal estimated baseline figure) over
the  next two  years  as we (1)  implement  Sarbannes-Oxley  ("SOX")  compliance
software and procedures,  (2) convert to systems implementing real-time control,
(3) expend resources and legal costs to develop co-marketing  agreements and (4)
create new  operating  teams to improve  logistics for the rapid supply of books
and other media to clients and to equally quickly secure payment.

Of  these  proprietary  systems  and  developments,   only  the  SOX  compliance
software/services suite is likely to specifically generate revenue; many Chinese
companies wish to float issues  publicly in worldwide  markets and in the United
States and only those that are credibly SOX-compliant may float issues at a fair
price.  As the  information  we need for SOX is the same as management  needs to
control its book/media  monolith in real-time,  we believe that the lease of our
new SOX service to  non-competitors  may  eventually  be a  significant  revenue
generator.

The Company  posted a net loss of $1,424,899  for the quarter and $3,254,820 for
the  nine-month  period.  65% (in the quarter) and 78% (in the 9-months) of this
loss  is due to  `stock-based  compensation'.  While  not a  cash-outlay  of the
Company,  stock-based  compensation  represents  a dilution  of the value of the
shareholders' equity.

These  Results  of  Operations   are  quite   different   from  and  are  indeed
incommensurable  with  prior  periods  in fiscal  2004,  as the  Company  made a
transition  from  mineral  exploration  to a  new  line  of  business  of  media
distribution  in China.  The rate of  expenditure  may be  maintained  given the
closing of the transaction acquiring the controlling corporations of Xinhua C&D.

Liquidity and Capital Resources
-------------------------------

On March 31, 2005, the Company had a working  capital  deficiency of $1,233,266.
This is covered by long-term  loans and bank-loans but  underscores the need for
prompt collection of trade accounts.

The Company anticipates that it will have to raise capital in the form of equity
financing from the sale of its common stock. As noted, the Company does not have
financing  arranged and it cannot provide  investors with assurance that it will
be able to raise  sufficient  funding  from the sale of its common stock to fund
its anticipated  business in China. In the absence of such timely  financing (or
financing from other sources such as might be included in trade  partnerships or
strategic  alliances)  the  Company's  business  plan  could  well fail to carry
through.



                                        5
<PAGE>






Corporate Background
--------------------

The Company was  incorporated  in the State of Nevada on September 14, 1999. The
Company maintains its registered  agent's office at 101 Convention Center Drive,
suite 700, Las Vegas, Nevada 89109 and its principal executive office is located
at B 26F Oriental Kenzo, No. 48 Dongzhimenwai, Dongcheng District, Beijing, P.R.
China 100027. The Company's telephone number is 86-10-84477275.

By an action of the majority  shareholders  which was filed on a Schedule 14C on
EDGAR on  September  20,  2004,  the Company  changed its name from Camden Mines
Limited to "Xinhua China Ltd." effective on October 12, 2004.

The Company has been engaged in the acquisition,  exploration and development of
mining  properties,  however,  the Company  has changed its  business to that of
being a majority owner of Xinhua  Publications  Circulation & Distribution  Co.,
Ltd.  ("Xinhua  C&D"),  a newly formed company  organized  under the laws of the
Peoples'  Republic  of China,  which is  expected  to be  assigned a  nationwide
distribution  licence  in  China  for:  books;  periodicals;  human  figure  art
pictorials;  audio video product distribution;  wholesale, retail and mail order
of publicly distributed electronic  publications;  advertisement by domestic and
foreign firms in certain categories of books; and classified ads.

On September 14, 2004, the Company announced the signing of two separate binding
Letter Agreements under which it would acquire all of the outstanding  shares of
Pac-Poly  Investments  Limited  ("Pac-Poly")  and 95 percent of the  outstanding
shares of Beijing  Boheng  Investments  Ltd.  ("Boheng").  The  shareholders  of
Pac-Poly,  a company  organized  under the laws of the British  Virgin  Islands,
would  receive   16,387,000  shares  of  the  Company's  common  stock  and  the
shareholders  of  Boheng,  a company  organized  under the laws of the  People's
Republic of China, would receive 18,613,000 shares of the Company's common stock
for a total of 35,000,000 shares.

Pac-Poly and Boheng previously signed an agreement to acquire in aggregate 57.67
percent of Xinhua C&D. In addition to the expected  assignment of the nationwide
distribution  licence  in China,  Xinhua  C&D  recently  finalized  distribution
agreements  for certain  international  publications  for the China  market.  On
January 1, 2005,  Pac-Poly and Boheng became  registered owners of 57.67 percent
of Xinhua C&D.

On January 21, 2005, the acquisitions of Pac-Poly and Boheng by the Company were
completed,  resulting in Pac-Poly being a wholly owned subsidiary of the Company
and Boheng being a majority owned (95%) subsidiary of the Company.

In addition to Xinhua China, other investors in Xinhua Publications  Circulation
and Distribution  Co., Ltd. include Xinhua Bookstore Head Office,  and ten other
founding member corporations.  Xinhua C&D has been established with the approval
of the General Administration of Press and Publication of China, the Ministry of
Commerce of China,  and the General  Office of the State  Industry  and Commerce
Administration of China.

In addition,  on January 21, 2005,  Mr.  Xianping  Wang,  the Company's  current
President, CEO and a director,  entered into a letter agreement with the Company


                                        6
<PAGE>






whereby Mr. Wang agreed, upon closing of the Pac-Poly and Boheng acquisitions by
the Company,  to surrender for cancellation  35,000,000  shares of the Company's
common stock from the  45,000,000  shares of the Company's  common stock that he
acquired on August 5, 2004. On February 2, 2005,  35,000,000  of the  45,000,000
shares  of the  Company's  common  stock  registered  in Mr.  Wang's  name  were
cancelled and returned to the Company's treasury.

Subsidiaries
------------

The Company has two subsidiaries - Pac-Poly and Boheng. The Company owns 100% of
Pac-Poly and 95% of Boheng.  The  Company's  business  operations  are conducted
through  Pac-Poly and Boheng,  which  control the  operating  subsidiary  Xinhua
Publications Circulation & Distribution Co., Ltd. through a 57.67% interest.

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

The Company is involved in book  distribution  has not  incurred any research or
development expenditures since our incorporation.

Shareholders
------------

As not all beneficial  shareholders have their shares registered in their names,
the total  number of  shareholders  is not  known;  however  the  Secretary  has
examined  the  available  lists  and  estimates  there  are  a  minimum  of  120
shareholders.

Dividends
---------

Other  than the  stock  dividend  of two  additional  shares  for each one share
outstanding,  which was effective  July 29, 2004 and the stock  dividend of four
additional  shares for each one share  outstanding,  which was effective May 15,
2001,  the  Company's  Board of Directors  has never  declared a dividend on its
common  stock.  The  Company's  previous  losses do not  currently  indicate the
ability  to pay any  cash  dividends,  and the  Company  does not  indicate  the
intention  of paying  cash  dividends  on its  common  stock in the  foreseeable
future.

Item 3. Controls and Procedures
-------------------------------

As of the end of the period covered by this quarterly  report, an evaluation was
performed  under the  supervision  and with the  participation  of the Company's
management,  including  the Chief  Executive  Officer  (the "CEO") and the Chief
Financial  Officer (the "CFO"), of the effectiveness of the design and operation
of the  disclosure  controls  and  procedures.  Based  on that  evaluation,  the
Company's  management,  including the CEO and CFO, concluded that the disclosure
controls  and  procedures  were  effective.  There have been no changes in these
internal  controls over  financial  reporting  that occurred  during the quarter
ended March 31, 2005, that have materially affected, or are reasonably likely to
materially affect, our internal controls over financial reporting.




                                        7
<PAGE>






Part II--Other Information
--------------------------

Item 1. Legal Proceedings
-------------------------

Management  is  not  aware  of  any  legal   proceedings   contemplated  by  any
governmental  authority or any other party  involving  the Company.  None of the
Company's  directors,  officers  or  affiliates  are (i) a party  adverse to the
Company in any legal proceedings, or (ii) has an adverse interest to the Company
in any legal proceedings. Management is not aware of any other legal proceedings
pending or that have been threatened against the Company.

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

Three  individuals,  two of whom are  directors  of the  Company,  exercised  in
aggregate 58,000 stock options in April and May at prices between $2.40 to $2.62
per share for total proceeds of $139,000. Such proceeds will be used for working
capital and have not yet been expended.

Item 3. Defaults Upon Senior Securities
---------------------------------------

     N/A

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

     N/A

Item 5. Other Information
-------------------------

     N/A

Item 6. Exhibits
----------------

     (a)  Exhibit List

          31.1 Certificate pursuant to Rule 13a-14(a)

          31.2 Certificate pursuant to Rule 13a-14(a)

          32.1 Certificate pursuant to 18 U.S.C. ss.1350

          32.2 Certificate pursuant to 18 U.S.C. ss.1350











                                        8
<PAGE>






                                   SIGNATURES
                                   ----------

In accordance with the  requirements of the Exchange Act, the registrant  caused
this  report to be  signed on its  behalf  by the  undersigned,  thereunto  duly
authorized.

                                         Xinhua China Ltd.
                                         -----------------

Date: May 22, 2005                       Per:     /s/ Henry Jung
                                             -----------------------------------
                                             Henry Jung, Chief Financial Officer
                                             and a Director











































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