UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

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




                                   (Mark One)

|X| Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934.

                    For the quarter ended September 30, 2006

|_| Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934.

              For the transition period from ________ to __________

                        Commission File Number: 000-30790

                        CHINA YINGXIA INTERNATIONAL, INC.
        (Exact name of small business issuer as specified in its charter)

             Florida                              65-0664961
   (State or other jurisdiction of      (IRS Employee Identification No.)
   incorporation or organization)

                       HARBIN YINGXIA INDUSTRIAL CO., LTD
                         NO.300, XIDAZHI STREET NANGANG
                          HARBIN HEILONGJIAN F4 150001
                    (address of principal executive offices)

                         c/o American Union Securities
                            100 Wall St. 15th Floor
                               New York, NY 10005
                    (address of principal agent's address)

                                 (212) 232-0120
                          (Issuer's telephone number)

              (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 |_|


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


The number of shares outstanding of each of the issuer's classes of common
equity, as of November 17, 2006 is 33,608,857 shares of common stock.



<PAGE>
                        CHINA YINGXIA INTERNATIONAL, INC.
                                   FORM 10-QSB

                                TABLE OF CONTENTS



PART I - FINANCIAL INFORMATION                                               1

     Item 1. Financial Statements                                            1

     Item 2. Management's Discussion and Analysis or Plan of Operation      11

     Item 3. Controls and Procedures                                        14

PART II - OTHER INFORMATION                                                 15

     Item 1. Legal Proceedings                                              15

     Item 2. Unregistered Sales of Equity Securities and Use of Proceeds    15

     Item 3. Defaults Upon Senior Securities                                15

     Item 4. Submission of Matters to a Vote of Security Holders            15

     Item 5. Other Information                                              15

     Item 6. Exhibits                                                       15

SIGNATURES                                                                  17

                                        i


<PAGE>
                         PART I - FINANCIAL INFORMATION

Item 1.     Financial Statements.



                        CHINA YINGXIA INTERNATIONAL, INC.
                   CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                            SEPTEMBER 30, 2006 & 2005
                                   (UNAUDITED)





                                       ii
<PAGE>
                        CHINA YINGXIA INTERNATIONAL, INC.
              INDEX TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                            SEPTEMBER 30, 2006 & 2005
                                   (UNAUDITED)


                                TABLE OF CONTENTS

<TABLE>
<CAPTION>

                                                                                 Page(s)


<S>                                                                                <C>
         Condensed Consolidated Balance Sheets as of September 30, 2006
                  (Unaudited) and December 31, 2005                                 1

         Condensed Consolidated Statements of Income for the Nine and
                  Three Months Ended September 30, 2006 and 2005 (Unaudited)        2
         Condensed Consolidated Statements of Cash Flows for the Nine Months
                  Ended September 30, 2006 and 2005 (Unaudited)                     3

         Notes to Condensed Consolidated Financial Statements (Unaudited)           4-10
</TABLE>




                                       iii
<PAGE>
               CHINA YINGXIA INTERNATIONAL, INC. AND SUBSIDIARIES

                      CONDENSED CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>

                                     ASSETS
                                                                                       December 31,         September 30,
                                                                                          2006                  2005
                                                                                        Unaudited              Unudited
                                                                                    ------------------   -------------------
<S>                                                                                        <C>                    <C>
Current assets:
     Cash and cash equivalents                                                      $          67,950    $           34,903
     Accounts receivable - net of allowance for doubtful accounts
        of $282,496 & $276,678, respectively                                                  289,922               676,717
     Inventory                                                                              1,019,803               182,908
     Prepaid expenses                                                                          10,686                 4,022
     Advances to suppliers                                                                  5,773,610             3,955,411
                                                                                    ------------------   -------------------
                   Total Current Assets                                                     7,161,971             4,853,961

Property and equipment, net of accumulated depreciation
        of $2,209,129 & $1,783,645, respectively                                            5,084,797             5,139,729

Other assets:
     Construction in progress                                                               5,407,626             4,712,389
     Other receivables                                                                      4,290,890             3,105,792
                                                                                    ------------------   -------------------

        Total Assets                                                                $      21,945,284    $       17,811,871
                                                                                    ==================   ===================


                      LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
     Accounts payable                                                                       $ 369,634             $ 499,833
     Income tax payable                                                                       417,508             2,402,098
     Other taxes (VAT) payable                                                                643,707               532,017
     Accrued expenses and other payables                                                    2,126,889               858,427
     Notes payable                                                                             99,798               210,652
                                                                                    ------------------   -------------------
                   Total Current Liabilities                                                3,657,536             4,503,027
                                                                                    ------------------   -------------------


Stockholders' Equity
     Preferred stock, $0.001 par value, 10,000,000 shares authorized; - 0 - shares
        outstanding at September 30, 2006 and December 31, 2005;                                    -                     -
     Common stock, $0.001 par value, 100,000,000 shares authorized;
        33,608,857 & 3,413,655 shares issued and outstanding at September 30,
        2006 and December 31, 2005, respectively;                                              33,609                 3,414
     Additional paid-in capital                                                             7,324,378             7,354,857
     Accumulated other comprehensive income                                                   670,438               359,819
     Retained earnings - Appropriated                                                         883,497               854,152
     Retained earnings -Unappropriated                                                      9,375,827             4,736,602
                                                                                    ------------------   -------------------
                   Total Shareholders' Equity                                              18,287,749            13,308,844
                                                                                    ------------------   -------------------

        Total Liabilities and Stockholders' Equity                                  $      21,945,284    $       17,811,871
                                                                                    ==================   ===================
</TABLE>

<PAGE>
               CHINA YINGXIA INTERNATIONAL, INC. AND SUBSIDIARIES

                   CONDENSED CONSOLIDATED STATEMENTS OF INCOME

         For the nine and three months ended September 30, 2006 and 2005
<TABLE>
<CAPTION>


                                                       Nine-Month Ended                  Three-Month Ended
                                               ---------------------------------  -------------------------------
                                                 September 30,    September 30,     September 30,   September 30,
                                                     2006            2005                 2006           2005
                                                 (Unaudited)      (Unaudited)        (Unaudited)     (Unaudited)
                                               ---------------   ---------------  ---------------  ---------------
<S>                                                   <C>               <C>              <C>              <C>
Sales                                          $    5,308,352    $    4,213,156   $    1,857,392   $    1,956,583

Cost of Sales                                       2,194,473         1,818,698          918,481          830,883
                                               ---------------   ---------------  ---------------  ---------------

Gross Profit                                        3,113,879         2,394,458          938,911        1,125,700

Operating Expenses
      Selling, general and administrative             404,655           302,065          196,712          157,910
                                               ---------------   ---------------  ---------------  ---------------

          Operating income                          2,709,224         2,092,393          742,199          967,790

Other Income and Expenses
      Interest income                                     212               233              102                -
      Other income                                        138            24,425                -           24,425
      Interest expense                                 25,595             7,670               50            7,670
                                               ---------------   ---------------  ---------------  ---------------

Income Before Income Taxes                          2,683,979         2,109,382          742,251          984,545

(Benefit) Provision for Income Taxes               (1,984,590)          696,096       (2,216,535)         324,900
                                               ---------------   ---------------  ---------------  ---------------

Net Income                                     $    4,668,569    $    1,413,286   $    2,958,786   $      659,645
                                               ===============   ===============  ===============  ===============

Basic and diluted income per common share      $         0.41    $         0.41   $         0.26   $         0.19
                                               ===============   ===============  ===============  ===============

Weighted average common shares                     11,418,877         3,413,655       11,418,877        3,413,655
                                               ===============   ===============  ===============  ===============
</TABLE>


<PAGE>
               CHINA YINGXIA INTERNATIONAL, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
              For the nine months ended September 30, 2006 and 2005

<TABLE>
<CAPTION>

                                                                           2006              2005
                                                                         (Unaudited)      (Unaudited)
                                                                      ---------------   ----------------
<S>                                                                          <C>                <C>
Cash Flows From Operating Activities:
    Net income                                                        $    4,668,569    $     1,413,286
    Adjustments to reconcile net income to net cash
       provided by operating activities:
          Depreciation and amortization                                      387,978            303,255

       Changes in operating assets and liabilities:
          Accounts receivable                                                386,795             81,919
          Inventory                                                         (836,895)         1,477,770
          Other receivable                                                (1,185,098)           205,780
          Advances to suppliers                                           (1,818,199)          (861,084)
          Prepaid expenses                                                    (6,664)                 -
          Accounts payable                                                  (130,199)           (96,027)
          Unearned revenue                                                         -            (52,422)
          Taxes payable                                                   (1,872,900)           772,293
          Accrued expenses and other payables                              1,268,462          1,037,554
                                                                      ---------------   ----------------

                    Cash provided by operating activities                    861,849          4,282,324
                                                                      ---------------   ----------------

Cash Flows From Investing Activities:
          Purchase of property and equipment                                (224,972)           (29,777)
          Additions to construction in process                              (695,237)          (415,310)                    `
                                                                      ---------------   ----------------

                    Cash used in investing activities                       (920,210)         (445,087)
                                                                      ---------------   ----------------

Cash Flows From Financing Activities:
          Proceeds from grants                                                     -             24,304
          Payment of notes payable                                          (110,854)                 -
                                                                      ---------------   ----------------

                    Cash provided by (used in) financing activities         (110,854)            24,304
                                                                      ---------------   ----------------


Effect of exchange rate changes on cash and cash equivalents                 202,262            179,025
                                                                      ---------------   ----------------

Net Increase in cash and cash equivalents                                     33,047          4,040,566

Cash and Cash Equivalents - Beginning of Period                               34,903             75,916
                                                                      ---------------   ----------------

Cash and Cash Equivalents - End of Period                             $       67,950    $     4,116,482
                                                                      ===============   ================

Supplemental disclosures of cash flow information:

          Interest paid                                               $       25,595            $ 7,670
                                                                      ===============   ================

          Income Taxes paid                                           $            -               $ -
                                                                      ===============   ================
</TABLE>

                                       3
<PAGE>
                CHINA YINGXIA INTERNATIONAL, INC. & SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                     SEPTEMBER 30, 2006 AND 2005 (UNAUDITED)



1. DESCRIPTION OF THE COMPANY

China  Yingxia  International,  Inc.  (the  "Company"  or "China  Yingxia")  was
incorporated  under  the laws of State  of  Florida  on May 6,  1996  under  the
original  name RCA  Trading  Co.,  and the  Company  later  changed  its name to
Agronix, Inc. ("Agronix").

On May 12, 2006, Warner  Nutraceutical  International,  Inc. ("WNI") merged with
and into Agronix  pursuant to an Agreement of Merger and Plan of  Reorganization
("Agreement")  dated  May  10,  2006.  Agronix  was  the  surviving  entity  and
subsequently changed its name to China Yingxia  International,  Inc. on July 12,
2006.  Pursuant  to the  agreement,  the  Company  issued  to  WNI  shareholders
54,811,475  shares of Common Stock, par value 0.01 per share, and  1,473,649.074
shares of Class A  Preferred  Stock,  par value  $0.01 per share,  of which each
share is  convertible  into  five  hundred  (500)  shares of  common  stock,  in
consideration  for a cash payment of $289,000 and all the outstanding  shares of
WNI, at the effective time of the merger, were canceled.

For accounting  purposes,  the  transaction  has been accounted for as a reverse
acquisition,  under the  purchase  method of  accounting.  Accordingly,  WNI was
treated as the continuing entity for accounting purposes.  Following the merger,
the  officers  and  directors  of Agronix  resigned  and was  replaced  with the
officers and directors of WNI.

WNI, a Delaware holding company,  operates its business through its wholly-owned
subsidiary Harbin Yingxia Business Group Co., Ltd. ("Harbin Yingxia"), a Chinese
company  primarily  engaged in the development,  production and sales of organic
agricultural  by-products and nutritional  health food products.  Harbin Yingxia
has several lines of products  including  organic food and produce,  nutritional
supplements, health care products and skin and beauty care products.


                                       4
<PAGE>
                CHINA YINGXIA INTERNATIONAL, INC. & SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                     SEPTEMBER 30, 2006 AND 2005 (UNAUDITED)


2. BASIS OF PREPARATION

Interim financial statements:

The  accompanying  financial  statements  and footnotes  have been condensed and
therefore  do  not  contain  all  disclosures  required  by  generally  accepted
accounting principles. The interim financial statements are unaudited;  however,
in the opinion of China Yingxia,  the interim financial  statements  include all
adjustments,  consisting only of normal recurring  adjustments,  necessary for a
fair  statement  of the  results for the  interim  periods.  Results for interim
periods are not  necessarily  indicative  of those to be  expected  for the full
year.  It is suggested  that these  condensed  financial  statements  be read in
conjunction  with the  December 31, 2005 audited  financial  statements  and the
accompanying  notes  thereto.  While  management  believes  that the  procedures
followed in preparing  these  condensed  consolidated  financial  statements are
reasonable, the 2. BASIS OF PREPARATION (Continued)

accuracy of the amounts are in some respects  dependent upon the facts that will
exist,  and  procedures  that will be  accomplished  by the Company later in the
year.



                                       5
<PAGE>
                CHINA YINGXIA INTERNATIONAL, INC. & SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                     SEPTEMBER 30, 2006 AND 2005 (UNAUDITED)



3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Use of estimates

In preparing the financial  statements in conformity with accounting  principles
generally  accepted in the United States of America,  management makes estimates
and assumptions  that affect the reported  amounts of assets and liabilities and
disclosures of contingent  assets and  liabilities at the dates of the financial
statements,  as well as the reported amounts of revenues and expenses during the
reporting  year.  Significant  estimates,  required by  management,  include the
recoverability  of long-lived  assets and the valuation of  inventories.  Actual
results could differ from those estimates.

Cash and cash equivalents

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

Accounts Receivables

Accounts  receivables are stated at net realizable value. This value includes an
appropriate  allowance for estimated  uncollectible  accounts.  The allowance is
calculated  based upon the evaluation and the level of past due accounts and the
relationship with and the economic status of the customers.

Inventories

Inventories  are valued at the lower of cost or market with cost determined on a
first-in first-out basis.

Property and equipment

Property and  equipment  are stated at cost,  net of  accumulated  depreciation.
Maintenance  and  repairs are charged to expense as  incurred.  Depreciation  is
computed using the straight-line  method over the estimated useful lives of 5-10
years.


                                       6
<PAGE>
                CHINA YINGXIA INTERNATIONAL, INC. & SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                     SEPTEMBER 30, 2006 AND 2005 (UNAUDITED)



3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Advance to suppliers

Prepaid  expenses  represent the payments made and recorded in advance for goods
and services.  Prepaid  expenses were made for the purchase of the materials and
equipment of the  Company's  construction  in  progress.  The final phase of the
construction is not completed.  As such, no amortization was made for the period
ended September 30, 2006.

Income taxes

The  Company  accounts  for  income  tax under  the  provisions  of SFAS  No.109
"Accounting for Income Taxes", which requires recognition of deferred tax assets
and liabilities for the expected future tax consequences of the events that have
been included in the financial statements or tax returns.  Deferred income taxes
are  recognized  for  all  significant  temporary  differences  between  tax and
financial  statements bases of assets and liabilities.  Valuation allowances are
established against net deferred tax assets when it is more likely than not that
some portion or all of the deferred tax asset will not be realized.

Revenue recognition

The Company  utilizes the accrual  method of  accounting.  Revenue is recognized
when  merchandise is shipped and title passes to the customers and collection is
reasonably assured.

Concentration of credit risk

Financial  instruments that potentially  subject the Company to concentration of
credit risk consist primarily of accounts receivable and other receivables.  The
Company  does  not  require  collateral  or  other  security  to  support  these
receivables.  The Company conducts  periodic  reviews of its clients'  financial
condition and customer payment practices to minimize collection risk on accounts
receivable.

The Company's  operations in the PRC are subject to special  considerations  and
significant  risks not typically  associated with companies in North America and
Western  Europe.   These  include  risks  associated  with,  among  others,  the
political,  economic  and legal  environments  legal  environments  and  foreign
currency exchange.

                                       7
<PAGE>
                CHINA YINGXIA INTERNATIONAL, INC. & SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                     SEPTEMBER 30, 2006 AND 2005 (UNAUDITED)



3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

The Company's results may be adversely  affected by changes in the political and
social  conditions  in the PRC,  and by changes in  governmental  policies  with
respect to laws and regulations, anti-inflationary measures, currency conversion
and remittance abroad, and rates and methods of taxation, among other things.

Fair value of financial instruments

The carrying amounts of certain financial instruments, including cash and cash
equivalents, accounts receivable, other receivables, accounts payable, accrued
expenses, taxes payable, notes payable and other loans payable approximate fair
value due to the short-term nature of these items. The carrying amounts of bank
borrowings approximate the fair value based on the Company's expected borrowing
rate for debt with similar remaining maturities and comparable risk.

Foreign currency translation

The Company's  functional  currency is the Renminbi  ("RMB").  Foreign  currency
transactions are translated at the applicable rates of exchange in effect at the
transaction  dates.  Monetary  assets  and  liabilities  denominated  in foreign
currencies at the balance sheet date are translated at the  applicable  rates of
exchange in effect at that date.  Revenues and expenses  are  translated  at the
average exchange rates in effect during the reporting period.

Translation  adjustments  arising from the use of different  exchange rates from
period  to  period  are  included  as a  component  of  stockholders'  equity as
"Accumulated  Other  Comprehensive  Income".  Gains and  losses  resulting  from
foreign currency  translations are included in Other  Accumulated  Comprehensive
Income.

Earnings per share

Basic  earnings  per share are computed by dividing  income  available to common
shareholders by the weighted-average  number of common shares outstanding during
the period.  The common  shares  prior to the reverse  split were  retroactively
restate.  Diluted  earnings per share is computed  similar to basic earnings per
share  except  that the  denominator  is  increased  to  include  the  number of
additional  common  shares  that would have been  outstanding  if the  potential
common shares had been issued and if the additional common shares were dilutive.
There are no common stock  equivalents  available  for  dilution  purposes as of
September 30, 2006.


                                       8
<PAGE>
                CHINA YINGXIA INTERNATIONAL, INC. & SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                     SEPTEMBER 30, 2006 AND 2005 (UNAUDITED)



3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Recent accounting pronouncements:

In February 2006, the Financial Accounting  Standards Board  (i(degree)FASBi+/-)
issued SFAS No. 155, Accounting for Certain Hybrid Financial Instruments,  which
amends  SFAS  No.  133,  Accounting  for  Derivative   Instruments  and  Hedging
Activities  (i(degree)SFAS No. 155), and SFAS No. 140,  Accounting for Transfers
and Servicing of Financial Assets and  Extinguishments of Liabilities.  SFAS No.
155  simplifies  the  accounting  for  certain  derivatives  embedded  in  other
financial  instruments  by allowing  them to be accounted  for as a whole if the
holder elects to account for the whole  instrument  on a fair value basis.  SFAS
No. 155 also clarifies and amends  certain other  provisions of SFAS No. 133 and
SFAS No. 144. SFAS No. 155 is effective for all financial  instruments acquired,
issued or subject to a re-measurement  event occurring in fiscal years beginning
after September 15, 2006.  Earlier  adoption is permitted,  provided the Company
has not yet issued financial statements, including for interim periods, for that
fiscal year.  The Company does not expect the adoption of SFAS No. 155 to have a
material impact on its financial  position,  results of operations or cash flows
as the Company currently has no financial  instruments  within the scope of SFAS
No. 155.

In May 2005, the FASB issued  Statement No. 154,  "Accounting  Changes and Error
Corrections"  ("FAS 154"). FAS 154 generally require that accounting changes and
errors be applied  retrospectively.  FAS 154 is effective for accounting changes
and  corrections  of errors made in fiscal years  beginning  after  December 15,
2005.  The  Company  does not expect  FAS 154 to have a  material  impact on its
financial statements.

In March 2005,  the FASB issued  Statement  of  Financial  Accounting  Standards
Interpretation   Number  47,   "Accounting  for  Conditional   Asset  Retirement
Obligations" ("FIN 47"). FIN 47 provides clarification  regarding the meaning of
he term "conditional asset retirement  obligation" as used in FASB Statement No.
143,  "Accounting  for Asset  Retirement  Obligations."  FIN 47 is effective for
fiscal  years  beginning  after  December  15,  2005.  The Company is  currently
evaluating the impact of FIN 47 on its financial statements.

4.   ASSETS

The September 30, 2006 balance sheet included total current assets of $7,161,971
and non-current assets of $14,783,313.  Of these amounts,  approximately $67,950
in cash is available for funding current operations.

Included in the current assets are accounts receivables, which are stated at net
realizable value. This value includes an appropriate allowance for estimated
uncollectible accounts. The allowance is based on reviews of loss, adjustment
history, current

                                       9
<PAGE>
                CHINA YINGXIA INTERNATIONAL, INC. & SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                     SEPTEMBER 30, 2006 AND 2005 (UNAUDITED)



4. ASSETS (Continued)

economic  conditions  and other factors that deserve  recognition  in estimating
potential losses.

Other current assets also included  inventories  that are mainly  finished goods
and very few raw  materials.  Inventories  are  stated  at the  lower of cost or
market.  Cost of raw  materials is determined on the basis of first in first out
method ("FIFO"). Finished goods are determined on the weighted average basis and
are comprised of direct materials, direct labor and an appropriate proportion of
overhead.  Also  included  in  the  current  assets  is  advance  to  suppliers,
representing  the payments made and recorded in advance of the receipts of goods
or services. Most of the prepayments were made for the purchase of the materials
and equipments of the Company's construction in progress.

Included  in  non-current  assets  are  property,  plant  and  equipment  mainly
consisting  of  machinery  used for  product  manufacturing  located in the PRC.
Depreciation  on property,  plant and  equipment is computed  using the straight
-line method over the estimated  useful life of the assets.  The majority of the
assets  have  estimated  useful  lives of 12  years.  Construction  in  progress
represents  direct costs of construction or acquisition and design fees incurred
for the Company's new plant and equipments. Capitalization of these costs ceases
and the  construction  in progress is  transferred  to plant and equipment  when
substantially  all the  activities  necessary  to  prepare  the assets for their
intended  use  are  completed.  Other  receivables  are  also  classified  under
non-current  assets.  Other  receivables  include dues from related  parties and
affiliates.  Related  parties  include  officers,  directors  and  more  than 5%
shareholders  of the  Company.  Affiliates  include  the  companies  with common
ownership  of  the  Company's  major  shareholders  and/or  companies  owned  by
officers' relatives.

5.   LIABILITIES

The September 30, 2006 balance sheet included  total  liabilities of $3,657,536.
All of them are considered current liabilities.

During this period, the Company's wholly-owned  subsidiary,  Harbin Yingxia, was
granted  the status of  Foreign-Invested  Enterprise  ("FIE")  because it is now
wholly owned by an U.S.  public company.  In accordance with applicable  Chinese
Law, Harbin Yingxia is therefore  eligible for an exemption of income tax in PRC
for the first two  profitable  years and a 50% income tax reduction for the next
three  years.   The  income  tax   exemption   and   reduction  can  be  applied
retroactively.  As result of this  change,  the  Company  recognized  a total of
$2,402,098 as income tax benefit in this period.  Meanwhile, the Company accrued
$417,508 U.S.  federal income taxes payable for the income earned for the period
since the Company's Chinese subsidiary was acquired.

                                       10
<PAGE>
                CHINA YINGXIA INTERNATIONAL, INC. & SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                     SEPTEMBER 30, 2006 AND 2005 (UNAUDITED)



5. LIABILITIES (Continued)

The Company also accrued unpaid Value Added Taxes ("VAT") as this type of tax is
typically levied in the People's Republic of China on the "value added" to goods
produced  by the  Company  when sold,  after  deducting  the taxes paid on their
purchases  of raw  materials.  The  Company  is subject to 17% of VAT on all the
goods sold, except for the Cactus  Seedlings,  which is VAT exempt classified by
the government as agricultural by-products.

The Company's three-year loan from the local government is expected to mature by
October 31, 2006,  according to the original loan terms. The Company  has repaid
$110,854 of the principal balance as originally scheduled in this period.

6. STOCKHOLDERS' EQUITY

Upon the completion of the reverse  acquisition on May 12, 2006, the Company had
outstanding 100,000,000 shares of Common Stock,  1,473,469.074 shares of Class A
Preferred  Stock,  of which each share is  convertible  into five hundred  (500)
shares of common stock.

On May 26,  2006,  the  Company's  board of  directors  had proposed a 1 to 24.9
reverse  stock split on both the common stock and  preferred  stock,  subject to
shareholder  approval.  On July 21,  2006,  the  proposal  was  approved  by the
Company's shareholders, each 24.9 shares of the Company's Common Stock and Class
A Preferred  Stock were converted into one (1) share of Common Stock and one (1)
share of  Class A  Preferred  Stock,  respectively.  Simultaneously,  all of the
preferred shares were converted into common shares and the preferred shares were
cancelled. As of September 30, 2006, there are 33,608,857 shares of common stock
outstanding and no preferred stock.

7. EFFECT OF CHANGE OF FOREIGN EXCHANGE RATE

For the quarter  ended  September 30, 2006,  almost all of the Company's  sales,
purchases  and  expenses  transactions  are  denominated  in RMB  and all of the
Company's  assets and  liabilities  are also  denominated in RMB. The RMB is not
traded freely in the foreign exchange market. Instead, the exchange rate against
US dollar is closely  controlled  by the  People's  Bank of China  ("PBC"),  the
central bank of Chinese government. In July 2005, PBC adjusted the exchange rate
tied to the U.S.  dollar by 2%, the  largest  percentage  change  ever since the
current exchange rate system has been in place since 1994. The official exchange
rate has been steadily going down since then,  which stands at  US$1:RMB7.904 at
September  30,  2006.  The  effect of this  exchange  rate  change  has caused a
translation  adjustment of $670,438 for the current period, which is included as
a component of stockholders' equity as "Accumulated Other Comprehensive Income".

                                       11
<PAGE>
Item 2. Management's Discussion and Analysis or Plan of Operation.

THE FOLLOWING INFORMATION SHOULD BE READ IN CONJUNCTION WITH THE FINANCIAL
STATEMENTS AND NOTES THERETO APPEARING ELSEWHERE IN THIS FORM 10-QSB.


                SAFE HARBOR REGARDING FORWARD-LOOKING STATEMENTS


The information contained in Item 2 contains  forward-looking  statements within
the  meaning of Section  27A of the  Securities  Act of 1933,  as  amended,  and
Section 21E of the Securities  Exchange Act of 1934, as amended.  Actual results
may materially differ from those projected in the forward-looking  statements as
a result of certain risks and uncertainties  set forth in this report.  Although
management believes that the assumptions made and expectations  reflected in the
forward-looking  statements  are  reasonable,  there  is no  assurance  that the
underlying assumptions will, in fact, prove to be correct or that actual results
will not be different from expectations expressed in this report.

Results of  Operations  for the Nine and Three Months Ended  September  30, 2006
compared to the Nine and Three Months Ended September 30, 2005

Revenue

     The Company  generated  $5,308,352  in net sales for the nine months  ended
September  30,  2006,  an  increase  of  $1,095,196  or 25.9% as compared to the
revenue of  $4,213,156  for the nine months ended  September  30, 2005.  For the
three months ended September 30, 2006, net sales totaled $1,857,392,  a decrease
of $99,191 or 5.1% as compared to net sales of  $1,956,583  for the three months
ended September 30, 2005.  Since the beginning of the year, the Company has been
actively  pursuing its expansion  plan to establish  retail  outlets in midsized
cities.  With our sales  office  established  in  Beijing,  we have been able to
attract  more  vendors and in turn more  orders.  Our growth in the three months
ended  September 30, 2006 slowed as more focus was toward the  completion of our
in-house soybean product  manufacturing  lines. As the production lines have not
come to run on full  capacity,  we were not able to achieve  higher sales in the
quarter.

Cost of Sales

     The cost of sales was  $2,194,473  for the nine months ended  September 30,
2006,  an  increase  of  $375,775  or 20.6% as  compared to the cost of sales of
$1,818,698  for the nine months ended  September 30, 2005. The cost of sales was
$918,481 for the three months ended  September  30, 2006, an increase of $87,598
or 10.5% as compared to $830,883 for the three months ended September 30, 2005.

     The increase in costs of sales during the nine month period ended September
30 is fully attributable to the 25.9% increase in revenues. For the three months
ended September 30, despite a decrease in revenues,  our cost of sales increased
due to the fact that  during  the same  period in 2005,  we were able to receive
lower prices for the raw materials.

                                       12
<PAGE>
Total Operating Expenses

     Total operating  expenses were $404,655 for the nine months ended September
30,  2006,  an increase  of  $102,590  or 33.9% as  compared to total  operating
expenses of  $302,065  for the nine  months  ended  September  30,  2005.  Total
operating  expenses were $196,712 for the three months ended September 30, 2006,
an  increase  of $38,802 or 24.6% as  compared  to total  operating  expenses of
$157,910  for the three  months  ended  September  30,  2005.  The  increase  in
operating  expenses  was  principally  attributable  to  the  expansion  of  our
operation. Our selling and administrative expenses rose with our higher revenues
accordingly.  Our  increase in  operating  expenses  for the three  months ended
September 30 is primarily  attributed to the set up of our Beijing sales office.
We have relocated current employees to Beijing temporarily to oversee the set up
of the office and the hiring of new local employees.

Net Income

     Net income for the nine  months  ended  September  30,  2006  increased  by
$3,255,283 to $4,668,569 from $1,413,286 for the nine months ended September 30,
2005.  Net income for the three months  ended  September  30, 2006  increased by
$2,299,141 to $2,958,786  from $659,645 for the three months ended September 30,
2005.  Overall increase in income before income taxes for the nine months period
can be mainly  attributed the expansion of our sales network.  Despite achieving
lower sales  totals for the three month  period,  we were able to record  higher
earnings  as  a  result  of  the  partial   operating  of  our  soybean  product
manufacturing   lines.   Additionally,   we  were   granted   the  status  of  a
Foreign-Invested  Enterprise  ("FIE") as we became  wholly owned by an US public
company  during  the  period  ended  September  30,  2006.  In  accordance  with
applicable  Chinese Law,  the Company is therefore  eligible for an exemption of
income  tax in PRC for the  first two  profitable  years  and a 50%  income  tax
reduction  for the next three years.  The income tax exemption and reduction can
be applied retroactively. In our case, this exemption is applied to fiscal years
2004 and 2005.  As result of this  change,  the  Company  recognized  a total of
$2,402,098 as income tax benefit in this period.  Meanwhile, the Company accrued
$417,508  U.S.  federal  income tax payable for the income earned for the period
since the Company's Chinese subsidiary was acquired.

Liquidity and Capital Resources

     As of September  30,  2006,  the Company had cash and cash  equivalents  of
$67,950,  as compared to $34,903 at December 31, 2005. As of September 30, 2006,
the  Company had working  capital of  $3,504,435,  as compared to $350,934 as of
December 31, 2005.

     Net cash  provided by operating  activities  totaled  $861,849 for the nine
months ended September 30, 2006, a decrease of $ 3,420,475 or 79.8%, as compared
to cash provided by operating activities of $4,282,324 for the nine months ended
September 30, 2005.  The decrease in net cash  provided by operating  activities
was  primarily due to the  expansion in our business  throughout  the nine month
period and the  increased  demand in working  capital as a result.  In addition,
since the Company was granted the status of Foreign Invested  Enterprise  (FIE),
it is eligible for an exemption of income tax for its first two profitable years
thereafter.  As a result,  the Company has no longer been accruing taxes payable
since the  second  quarter  of 2006.  The  Company  inventory  levels  have also
increased in 2006  compared to 2005 as a result of the  establishment  of its in
house production facilities.

                                       13
<PAGE>
     Net cash used in investing  activities totaled $920,210 for the nine months
ended  September  30,  2006,  an increase of $475,123 or 106.7%,  as compared to
$445,087 for the nine months ended  September  30,  2005.  This  increase can be
attributed to the investments we made in the  construction of our  soybean-based
products manufacturing lines.

     Net cash used in financing  activities totaled $110,854 for the nine months
ended  September 30, 2006,  as compared to $23,304  provided for the nine months
ended September 30, 2005.

     This amount was  attributed  to the payment of the  principal  balance of a
three-year loan from the local government which matures on October 31, 2006. The
$23,304  received in 2005 was a grant from the local  government  to support the
development of farming industries which we had been classified as at the time.

     We  intend  to use our  available  funds  as  working  capital  and to make
expansion in our existing lines of business. We believe that our available funds
will  provide us with  adequate  capital  for at least the next  twelve  months;
however,  to the extent that we make  acquisitions,  we may  require  additional
capital for the acquisition or for the operation of the combined  companies.  We
cannot assure that such funding will be available.

     We do not foresee  any event or  uncertainty  nor is there any  evidence in
consumer  demand or  confidence  that  would  reflect  any  trend to impact  our
short-term or long-term  liquidity.  By selling  products through retail outlets
and also franchise  bases,  the Company  limits the  commitments it must make to
suppliers related to the manufacture of its products. In short, the Company only
manufactures  products based upon fully paid existing orders or orders partially
paid with deposits.  Using this mechanism, the Company has limited the amount of
inventory  it keeps on hand.  The Company  funds its  operations  internally  or
through  contributions  by  management  as reflected in the  additional  paid in
capital.  The only source of external  financing  is through  government  loans.
Currently, the Company has a note payable of $99,798 from a three year loan from
the Harbin Forestry Bureau set to mature on October 31, 2006.

     The construction of our production  plants is financed  internally  through
cash on hand and contributions by the management as reflected in additional paid
in capital.  We do not have any material external  commitments for these capital
expenditures.

Off-Balance Sheet Arrangements

     We do  not  have  off-balance  sheet  arrangements,  financings,  or  other
relationships  with  unconsolidated  entities  or other  persons,  also known as
"special purpose entities" (SPEs).

Item 3.    Controls and Procedures

     Under  the  supervision  and  with  the  participation  of our  management,
including our principal  executive officer and principal  financial officer,  we
conducted an evaluation of our disclosure controls and procedures,  as such term
is  defined  under  Rule  13a-15(e)  and Rule  15d-15(e)  promulgated  under the
Securities  Exchange Act of 1934,  as amended  (Exchange  Act),  as of March 31,
2006. Based on this evaluation,  our principal  executive  officer and principal
financial officer have concluded that our disclosure controls and procedures are
effective  to ensure  that  information  required to be  disclosed  by us in the
reports  we file or  submit  under  the  Exchange  Act is  recorded,  processed,
summarized, and reported within the time periods specified in the Securities and
Exchange  Commission's  rules and forms and that our disclosure and controls are
designed  to ensure  that  information  required  to be  disclosed  by us in the
reports  that we file or  submit  under  the  Exchange  Act is  accumulated  and
communicated to our management,  including our principal  executive  officer and
principal  financial  officer,  or  persons  performing  similar  functions,  as
appropriate to allow timely decisions regarding required disclosure.

     There  were  no  changes  (including  corrective  actions  with  regard  to
significant  deficiencies or material  weaknesses) in our internal controls over
financial  reporting that occurred during the second quarter of fiscal 2006 that
has  materially  affected,  or is reasonably  likely to materially  affect,  our
internal control over financial reporting.

                                       14
<PAGE>
                           PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

     We are currently not a party to any pending legal  proceedings  and no such
action by, or to the best of our knowledge, against us has been threatened.

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

         None.

Item 3. Defaults Upon Senior Securities.

         None.

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

         None.

Item 5. Other Information.

         None.

Item 6. Exhibits and Reports of Form 8-K.

          (a) Exhibits

          31.1 Certification  pursuant to Section  302 of Sarbanes  Oxley Act of
               2002


          32.1 Certification  pursuant to Section  906 of Sarbanes  Oxley Act of
               2002

          (b)  Reports of Form 8-K None.


                                       15
<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,  there unto
duly authorized.


                   CHINA YINGXIA INTERNATIONAL, INC.

                   By: /s/ Yingxia Jiao
                       ----------------
                       Yingxia Jiao
                       Chief Executive Officer,
                       Chief Financial Officer


Date:    November 20, 2006


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