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

                                   FORM 10-KSB

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

                   For the fiscal year ended December 31, 2004

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

             For the transition period from __________ to __________

Commission file number:  333-105903

                          GENERAL STEEL HOLDINGS, INC.
                 (Name of Small Business Issuer in Its Charter)

             NEVADA                                       412079252
   (State or Other Jurisdiction of          (I.R.S. Employer Identification No.)
    Incorporation or Organization)

10th Floor, Building A, Haitong Plaza,                      100037
         No.3 Nanlishi Ave.
          Xicheng District
           Beijing, China
(Address of Principal Executive Offices)                   (Zip Code)

                              Incorp Services Inc.
                             6075 S. Eastern Avenue
                     Suite 1, Las Vegas, Nevada, 89119-3146
                               Tel: (702) 866-2500
           (Name, address and telephone number for Agent for Service)

                               + 86 (10) 68000346
                           (Issuer's telephone number)

 Securities registered under Section 12(b) of the Exchange Act:  none
 Securities registered under Section 12(g) of the Exchange Act:

                          Common Stock, $.001 par value
                                (Title of Class)

Check  whether  the issuer  (1) has 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 [ ]

Check if there is no disclosure of delinquent  filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure  will be contained,  to
the  best  of  registrant's   knowledge,  in  definitive  proxy  or  information
statements  incorporated  by  reference  in Part III of this Form  10-KSB or any
amendment to this Form 10-KSB. [ ]

The issuer's gross revenues for its fiscal year ended December 31, 2004 were
$87, 831, 919.

The  aggregate  market value of the Common Stock held by  non-affiliates  of the
registrant  based  on  the  closing  price  of  $1.01  on  March  30,  2005  was
$31,562,500.

The  number  of  shares  of  Common  Stock  outstanding  on March  30,  2005 was
31,250,000.

The following  documents are  incorporated by reference to this annual report of
form 10-KSB: None Transitional Small Business Disclosure Format (check one):
Yes [ ] No [X]

<PAGE>
                                     Part I

         This  report  on Form  10-KSB  and  documents  incorporated  herein  by
reference contain certain "forward-looking statements" as defined by the Private
Securities  Litigation  Reform Act of 1995, which involve  substantial risks and
uncertainties.  When  used in this  report  and in  other  reports  filed by the
Company, the forward-looking  statements are often identified by the use of such
terms and phrases as "anticipates,"  "believes,"  "intends," "plans," "expects,"
"seeks," "scheduled," "foreseeable future" and similar expressions. Although the
Company believes the understandings and assumptions on which the forward-looking
statements  in this  report  are  based are  reasonable,  the  Company's  actual
results,  performance and achievements  could differ materially from the results
in, or implied by, these forward-looking statements.  Certain factors that could
cause or contribute to such  differences  include those discussed in "Management
Discussion and Analysis" and elsewhere herein.

         Certain financial  information  included in this annual report has been
derived from data originally  prepared in Renminbi ("RMB"),  the currency of the
People's  Republic  of China  ("China"  or "PRC").  For  purposes of this annual
report,  a  conversion  rate of  US$1.00  to RMB 8.3 was  utilized.  There is no
assurance that RMB amounts could have been or could be converted into US dollars
at that rate.


Item 1.  Description of Business.

         As used in this annual report, "we", "us", "our",  "General Steel", the
"Company" or "our Company" refers to General Steel Holdings, Inc. and all of its
subsidiaries and affiliates companies.

Business development

         Our  Company  was  initially  incorporated  as  "American  Construction
Company", on August 5, 2002 in the State of Nevada for the purpose of commencing
a business of general construction contracting.

         It is the Company's  objective to provide to its  customers  timely and
durable  constructions of their  residential and commercial needs. To accomplish
the  above  objective  the  now  retired  founder  of our  company,  Jeff  Mabry
established American  Construction  Company.  American Construction Company then
established its subsidiary,  West Dee Construction Ltd. (a Saskatchewan,  Canada
Company)  on August 8, 2002 by  purchasing  100  shares  from its  treasury.  We
established  our  subsidiary  for the  purpose  of  achieving  our above  stated
objectives  in  Saskatchewan,  Canada,  that is,  to enter the  residential  and
commercial construction industry in this market.

         On October 14, 2004,  American  Construction  Company and General Steel
Investment Co., Ltd. ("General Steel Investment") and Northwest Steel Company, a
Nevada corporation  ("Merger Sub"), entered into an Agreement and Plan of Merger
(the  "Agreement")  pursuant to which  American  Construction  Company  acquired
General Steel  Investment,  and its 70% ownership in its subsidiary  Daqiuzhuang
Metal Sheet Co., Ltd. in exchange for shares of the Company's  common stock,  of
which  22,340,000  shares are a new issuance by the Company.  Under the terms of


                                       1
<PAGE>

the Agreement,  General Steel Investment  remained a wholly-owned  subsidiary of
the Company. The transaction  contemplated by the Agreement was intended to be a
"tax-free"  reorganization  pursuant  to  the  provisions  of  Section  351  and
368(a)(1)(A) of the Internal Revenue Code of 1986, as amended.  The stockholders
of General Steel,  after completion of the Merger,  now own approximately 96% of
the Company's  common stock  outstanding  as of October 15, 2004  (excluding any
additional  shares  issueable  upon  outstanding  options,  warrants  and  other
securities convertible into common stock).

         Daqiuzhuang Metal Sheet Co., Ltd. ("Daqiuzhuang Metal") was established
on August 18, 2000 in Jinghai county, Tianjin city, Hebei province, the People's
Republic of China (PRC).  The Articles of  Incorporation  provides for a 10-year
operating  term  beginning  on  August  18,  2000  with  registered  capital  of
$9,583,200. The Company is a Chinese registered limited liability company with a
legal structure  similar to a limited  liability  company  organized under state
laws in the United States of America.  Tianjin Long Yu Trading Material Co., Ltd
was the majority owner with 71% of ownership  interest.  Tianjin Long Yu Trading
Material Co., Ltd was incorporated in 2000 in Tianjin Municipality,  Daqiuzhuang
county;  People's  Republic  of China.  Mr.  Yu,  Zuo Sheng has a 90%  ownership
interest in Tianjin Long Yu Trading Material Co., Ltd.

         During  January 2004,  upon the Board of Directors'  approval,  Tianjin
Long Yu Trading  Material Co., Ltd and other  minority  shareholders  sold their
interests  amounting to 70% to Yang Pu Capital  Automotive  Investment  Limited.
Yang Pu Capital  Automotive  Investment  Limited is a Chinese registered limited
liability company which is 100% indirectly owned by Mr. Yu, Zuo Sheng.

         On May 16, 2004,  the Company  agreed to purchase  Yang Pu's 70% equity
interest  in  Daqiuzhuang   Metal  for  the  amount  of  55.45  million  RMB  or
approximately $6,709,450. The Company received a new business license certifying
the new ownership structure as a Chinese Foreign Joint Venture on June 25, 2004.

         The  Company  through  its  subsidiary  Daqiuzhuang  Metal  principally
engages in the  manufacturing of hot rolled carbon and silicon steel sheets that
are  mainly  used on  tractors,  agricultural  vehicles  and in other  specialty
markets. The Company sells its products through both retailers and wholesalers.

         On October 14, 2004, based on the Company's Plan of Merger with General
Steel, the Board of Directors  determined to change the Registrant's fiscal year
end from January 31 to December 31.

         Effective  March 7, 2005,  American  Construction  Company  amended its
Articles of Incorporation  to change its name to "General Steel Holdings,  Inc."
The name change to General Steel Holdings, Inc. was an important milestone as it
helped our  current  and  future  investors  more  readily  understand  our core
business in China.


                                       2
<PAGE>

         The Company recently announced an initial stage joint venture agreement
with the China  Inner  Mongolia  Baogang  Steel  Union  that is  anticipated  to
increase the annual steel plate  production  from the current  250,000 s to over
1,000,000  tons if the joint  venture  transaction  is  accomplished.

Principal Products

         The Company  produces hot rolled carbon and silicon  steel sheets.  The
sizes of sheets are  roughly  2,000 mm (width) x 1,000 mm (length) x 0.75 to 2.0
mm  (thickness).  Limited size  adjustments  are possible to meet specific order
requirements.

         "Qiu Steel" is the registered  trademark  under which our Company sells
its products.  The Company's  logo has been  registered  with the China National
Trademark Bureau under No. 586433. "Qiu Steel" is registered under the GB 912-89
national quality  standard,  and certified under the National Quality  Assurance
program.

         The Company was awarded the  "Excellent  Quality  Product" award by the
Tianjin  Products  Technical  Quality  Assurance Bureau in 2001, and the "Famous
Trade Mark Award" by the Tianjin Commerce Bureau in 2002.

         From 2003 to 2004, overall Company's sales volume increased by 41% from
135,110 tons in 2003 to 190,936 tons in 2004.

Marketing and Customers

         Hot rolled carbon and silicon steel sheets are semi-finished  products.
The Company sells its products  primarily to distributors,  service centers,  or
manufacturers  who may further  process  these  products or resell them  without
further processing.

         The Company's products are primarily used by domestic  manufacturers of
economy agricultural vehicles: small, motorized, 3-wheel vehicles with a payload
from 1,650 to 4,400 lbs. (750 to 2,000 kgs),  retailing  between 1,200 and 1,800
USD (10,000 -15,000 RMB).

         The production of inexpensive agriculture vehicles targets the needs of
low  income  farming  populations  in the rural  areas of  China.  International
non-government  organizations  estimate  that 80% of China's  population  of 1.1
billion is comprised of low-income rural farmers.



                                       3
<PAGE>

         From production and sales figures  supplied by its customers  producing
economy  agricultural  vehicles,  the Company  estimates it supplies 40% of this
industry's nationwide demand for hot rolled steel products.

         The  Company's  marketing  efforts  are mainly  directed  toward  those
customers who have exacting requirements for on-time delivery,  customer support
and product quality.  The Company believes that its enhanced product quality and
delivery  capabilities,  and  its  emphasis  on  customer  support  and  product
planning,  are  critical  factors in its  ability  to serve this  segment of the
market.

         The Company currently sells its products through the following eighteen
distributors:

Inner   Mongolia   Baotou   Yili                Henan   Yuanyang   Jinxin  Metal
Commercial Trading Co., Ltd.                    Sheet Co., Ltd.

Jiangsu     Nantong     Zhongtie                Zhejiang   Jianlong  Steel  Co.,
Economic  and   TradeDevelopment                Ltd.
Co., Ltd.

Shandong  Zibo  Zhoucun  Jinzhou                Jiangsu  Wuxi  Dazhuang   Supply
Supply Materials Co., Ltd.                      Materials Co., Ltd.

Qinghai Xining  Zhenning  Supply                Shanghai   Jinyijin   Commercial
Materials Co., Ltd.                             Trading Co., Ltd.

Shandong  Gaomi  Xinfeng  Supply                Tianjin    Jinghai    Qiangsheng
Materials Co., Ltd.                             Industrial Trading Co., Ltd.

Jiangsu   Zongshen    Motorcycle                Tianjin    Beihua     Industrial
Manufacturing Co., Ltd.                         Trading Co., Ltd.

Shandong  Boxing  County  Boyuan                Jiangsu  Yancheng  Xigang  Steel
Supply Materials Co., Ltd.                      Products Co., Ltd.

Gansu      Lanzhou      Northern                Henan   Changge   Stone   Supply
Petrochemical  and Metallurgical                Materials Co., Ltd.
Co., Ltd.

Shandong Qufu Erqing  Industrial
Supply and Sales Co., Ltd.



                                       4
<PAGE>

         Upon inception of business,  each  distributor pays a 500,000 RMB, that
is,  approximately  $60,500 deposit to the Company.  Distributors  must submit a
monthly sales plan for each calendar year.  Distributors  are required to have a
minimum  annual order  requirement of 5,000 tons.  Distributors  who do not meet
this quota are penalized based on a certain percentage of the difference between
the minimum  requirement  and their actual sales.  Thus far, the Company has not
experienced  such a problem with any of its  distributors and hence did not have
to enforce any penalty.  All of the orders by the  distributors are paid in full
by cash payment. Distributors place orders thirty days prior to delivery and pay
in full upon  delivery.

         Our revenue is dependent,  in large part, on significant contracts from
a limited  number of customers.  During the fiscal year ended  December 31, 2004
approximately 40% of sales were to five customers and approximately 20% of sales
were to one  customer.  We believe that revenue  derived from current and future
large  customers  will continue to represent a significant  portion of our total
revenue.

Competition

         Competition  within the steel industry is intense.  In the sale of flat
rolled carbon steel and silicon steel, the Company competes with its competitors
on the basis of product quality, responsiveness to customer needs and price.

         There  are two types of steel and iron  companies  in China:  (i) State
Owned Enterprises ("SOEs") and (ii) privately owned companies.  The Company does
not consider  foreign steel producers to be its  competitors.  Most SOEs produce
both  carbon  steel and  silicone  steel  products  utilizing  both hot and cold
rolling   production   technologies.   Products   produced   with  cold  rolling
technologies   are  of  higher  quality  than  those  produced  by  hot  rolling
technologies.   Throughout  China,  SOEs  are  widely   characterized  by  large
production capacities and poor management  efficiencies.  As a result,  products
produced by SOEs tend to be of higher  price than those  produced  by  privately
owned firms.  Compared to SOEs,  privately owned companies are  characterized by
small to moderate production capacities and more efficient management practices.
To the Company's knowledge, no privately owned steel firms in China utilize cold
rolling production technologies.

         The  Company   competes  with  both  SOEs  and  privately  owned  steel
manufacturers.  The Company considers there to be 5 major competitors of similar
size,  production  capability and product line in the market place: Henan Anyang
Metal Sheet Plant, Nanjing Metal Sheet Plant, Tianjin No. 1 Rolling Steel Plant,
Tianjin  Yinze Metal Sheet Plant and  Tangshan  Fengrun  Metal Sheet  Plant.  Of
these,  only Tangshan Fengrun Metal Sheet Co. is a privately owned company.  Qiu
Steel maintains high product  quality  standards and enjoys a good reputation in
the marketplace.

                                       5
<PAGE>

Employees

         As of December  31,  2004,  the Company  had  approximately  850 active
full-time  employees.  Of these,  about 100 were  officers,  managers and clerks
involved in  management  and  administrative  functions.  None of the  Company's
employees are union members or covered by collective bargaining agreements.

         The  Company  believes  that its  employee  relations  are good and the
Company has been, and continues to be, proactive in establishing and maintaining
a climate of good  relations with its employees.  On-going  initiatives  include
organizational skill training and team building programs.

Environmental Regulation

         Domestic  steel  producers,  including  the  Company,  are  subject  to
stringent national and local environmental laws and regulations.

         The  Company  does not  anticipate  any  material  impact on its future
recurring  operating costs or  profitability  as a result of its compliance with
current environmental regulations. Moreover, the Company believes that since all
domestic  steel   producers   operate  under  the  same  set  of   environmental
regulations,  the Company is under no  competitive  disadvantage  resulting from
compliance with such regulations.

         Our president and CEO, Zu Sheng Yu, through various  companies has been
managing and conducting steel  manufacturing  and related  operations for nearly
twenty years. The Company believes that it is currently  meeting all operational
standards required by the national and local environmental authorities. Pursuant
to  the  Chinese   Environmental   Protection  Act  of1989  and  Amendments  for
Enforcement and Penalty Act of 1999, the Chinese Environmental protection agency
and its authorized local environmental  protection and environmental  management
agencies have conducted annual on-site inspections of the Company's  operations.
In each  inspection,  the Company has been found to comply with all  regulations
and practices and has not been assessed any penalty.

         The  Company  mainly  purchases  two  types of raw  materials  from its
suppliers  which are ingots and slabs.  Slabs can be used in the  production  of
metal sheets directly.  Ingots need to be broken down into slabs after purchase.
The Company  purchases Ingots from Tangshan Songting Steel Co., Ltd. and Luannan
Pengcheng  Steel Co.,  Ltd.  These  ingots will be broken down at Tangshan  Fuli
Steel Mill, Xingtai Baorunda Steel Mill, and Tianjin Yunfeng Steel Co., Ltd. The
Company will have to pay a processing fee to these ingot-breaking plants.



                                       6
<PAGE>

         The Company spent approximately RMB 1.4 million, that is, approximately
$169,400 on an Enterprise  Resource  Planning  ("ERP")  system during the fiscal
year  2004.  It is  expected  that the ERP will  assist the  Company  manage its
production more effectively and efficiently.

         No governmental approval is required to conduct our activities.

Item 2.   Description of Property

Property

         The  Company's  sole  manufacturing  site and the office  buildings are
located in the Hebei province,  Jinghai  county,  about 20 miles (45 kilometers)
southwest  of the Tianjin  city  center.  The Company is situated on 1,819 acres
(736  hectares) of land and resides  within  320,390 sq. ft.  (29,667 sq. m.) of
building space. All property is fully owned and has been paid in full. There are
no  outstanding  liens  or  mortgages  on the  property  owned  by the  Company.
Equipment

         The Company's production equipment includes the following:

-------------------------------------------------------- -----------------------
Equipment                                                Quantity
-------------------------------------------------------- -----------------------
1,200 mm Rolling machine                                 6
-------------------------------------------------------- -----------------------
Gas-fired reheat furnace                                 6
-------------------------------------------------------- -----------------------
18 x 300 mm cut to size shearer                          4
-------------------------------------------------------- -----------------------
1,113 x 2,500 mm cut to size shearer                     1
-------------------------------------------------------- -----------------------
116 x 2,500 cut to size shearer                          10
-------------------------------------------------------- -----------------------
2,200 m3 gas producer                                    6
-------------------------------------------------------- -----------------------
Annealing furnace                                        2
-------------------------------------------------------- -----------------------
2,500 m3 gas producer                                    2
-------------------------------------------------------- -----------------------
Air compressor                                           6
-------------------------------------------------------- -----------------------
Flattening machine                                       2
-------------------------------------------------------- -----------------------
Straightening machine                                    3
-------------------------------------------------------- -----------------------
Overhead cranes                                          8
-------------------------------------------------------- -----------------------
Transportation vehicles (10 - 15 tons)                   3
-------------------------------------------------------- -----------------------

         All equipment is owned by the Company and has been paid in full.

Item 3.   Legal Proceedings.

         We are currently not involved in any  litigation  that we believe could
have a  materially  adverse  effect on our  financial  condition  or  results of
operations.  There is no action,  suit,  proceeding,  inquiry  or  investigation
before  or by  any  court,  public  board,  government  agency,  self-regulatory



                                       7
<PAGE>

organization  or body pending or, to the knowledge of the executive  officers of
our company or any of our  subsidiaries,  threatened  against or  affecting  our
company,  our common stock,  any of our  subsidiaries or of our company's or our
company's  subsidiaries'  officers or directors in their  capacities as such, in
which an adverse decision could have a material adverse effect.

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

         No matter was submitted to a vote of security holders.

                                     Part II


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

         Our common stock is quoted sporadically,  with relatively small volumes
of  actual  trading,  on the  Over-The-Counter  Bulletin  Board  system  and the
National  Association  of Securities  Dealers (NASD)  Electronic  Bulletin Board
under the symbol "GSHO.OB".

         The following table sets forth, for the periods indicated, the high and
low sales prices for our common stock, as reported by Yahoo! Finance

------------------------------- ------------------- ----------------------------
Fiscal year ended December 31
------------------------------- ------------------- ----------------------------
2005                            First quarter       $0.98 - $2.25
------------------------------- ------------------- ----------------------------
2004                            Fourth quarter      $1.25 - $2.50
------------------------------- ------------------- ----------------------------
                                Third quarter       N/A
------------------------------- ------------------- ----------------------------
                                Second quarter      N/A
------------------------------- ------------------- ----------------------------
                                First quarter       N/A
------------------------------- ------------------- ----------------------------
2003                            Fourth              N/A
------------------------------- ------------------- ----------------------------
                                Third               N/A
------------------------------- ------------------- ----------------------------
                                Second              N/A
------------------------------- ------------------- ----------------------------

         The  authorized  capital  stock of the  Company  under its  Articles of
Incorporation is 75,000,000 shares of common stock, par value $.001 per share.

         As of December 31, 2004,  there were 31,250,000  shares of common stock
outstanding  held of record by  approximately  20  stockholders.  Of such shares
outstanding,  23,929,500  were held of record by Yu,  Zuo  Sheng,  which  shares
represented approximately 76.5 % of the combined voting power of the outstanding
shares of common stock.

Dividends

         We may never pay any dividends to our shareholders.  We did not declare
any  dividends  for the twelve  months ended  December  31,  2004.  Our Board of
Directors  does not  intend to  distribute  dividends  in the near  future.  The
declaration,  payment  and  amount of any future  dividends  will be made at the
discretion of the Board of Directors,  and will depend upon, among other things,
the results of our operations, cash flows and financial condition, operating and
capital  requirements,  and other  factors as the Board of  Directors  considers
relevant.  There is no  assurance  that future  dividends  will be paid,  and if
dividends are paid, there is no assurance with respect to the amount of any such
dividend.

Equity compensation plan

         The Company  currently  does not have any equity  compensation  plan in
place.



                                       8
<PAGE>

Transfer Agent

         Our transfer agent is Pacific Transfer Co. Its address is 500 East Warn
Springs  Road,  Suite 240, Las Vegas,  NV 89119.  Recent  Sales of  Unregistered
Securities

         On August 5, 2002 we issued 5,100,000 common shares,  having $0.001 par
value per share,  to Jeff  Mabry,  the  Director  and founder of the Company for
$5,100  pursuant to Regulation D Rule 506 of the Securities  Act of 1933.  These
shares were paid for on April 4, 2003.

         On June 2, 2003, we accepted and executed subscription  agreements that
sold 4,075,000 common shares,  having $0.001 par value per share, to 29 persons,
at an offering price of $0.001 per share for gross  offering  proceeds of $4,075
USD,  pursuant to Regulation D Rule 506 of the  Securities Act of 1933. For this
offering we offered our shares of common stock to a limited  number of offerees,
with  whom we had a  pre-existing  relationship.  Each of the  investors  in our
company  were  friends or business  associates  of Mr.  Mabry the  director  and
founder of the company. Each person purchasing our shares of common stock who we
reasonably  believed was not an accredited  investor (as that term is defined by
the provisions of Rule 501(a),  received from us that  information  specified by
the  provisions of Rule 502(b).  Additionally,  we reasonably  believe that each
such person  either alone or with his or her purchaser  representative  (as that
term is  defined by the  provisions  of Rule  501(h)),  has such  knowledge  and
experience  in  financial  and  business  matters  that he or she was capable of
evaluating  the merits and risks of a purchase  of our common  shares.  For each
offering, we discussed with each purchaser in, what we believe to be, reasonable
detail the various aspects,  including the risks,  relating to a purchase of our
common stock. Each of the 29 investors were not accredited investors.

Item 6.  Management's Discussion and Analysis

         The  following  is  management's  discussion  and  analysis  of certain
significant  factors which have  affected our  financial  position and operating
results during the periods included in the accompanying  consolidated  financial
statements,  as  well  as  information  relating  to the  plans  of our  current
management.  The following discussion and analysis should be read in conjunction
with and our consolidated financial statements and the related notes thereto and
other financial information contained elsewhere in this Form 10-KSB.



                                       9
<PAGE>

Overview

         Following the acquisition of ownership in General Steel Investment Co.,
Ltd.,  the Company has shifted its main business focus to general steel products
and steel  manufacturing.  As the  core-operating  unit of the Company,  Tianjin
Daqiuzhuang  Metal Sheet Co.,  Ltd.  (herein  referred  to as "DQ")  started its
operation in 1988. DQ's core business is the  manufacturing  of high quality hot
rolled carbon and silicon  steel sheets which are mainly used in the  production
of tractors, agricultural vehicles and in other specialty markets.

         DQ  uses a  traditional  rolling  mill  production  sequence,  such  as
heating, rolling, cutting, annealing, and flattening to process slabs into steel
sheets. The sheet sizes are approximately 2,000 mm (length) x 1,000 mm (width) x
0.75 to 2.0 mm (thickness).  Limited size adjustments are possible to meet order
requirements. "Qiu Steel" is the registered name for the Company's products.

         Since 1998,  DQ has expanded its  operations  to six  production  lines
producing  250,000 tons of 0.75-2.0 mm hot-rolled  carbon steel sheets per year,
maintaining  a 40% market  share of all steel sheets used in the  production  of
agricultural  vehicles  in China.  The  Company  plans to continue to expand its
hot-rolled steel sheet production  capacity and to enter into new contracts with
vehicle manufacturers and other customers.

         Economic  forecasts  indicate  continued  fast pace  growth in China in
2005. As a result,  the  consumption of our steel products is expected to remain
at a high level.  The Company believes that the highly  competitive  market will
exist throughout  2005, with pressures for shipment volumes and prices.  In view
of the  above  factor,  the main  focus  of the  Company  in 2005  will be on:

         o        Stringent cost control and cash management;

         o        Continued operational improvement, with particular emphasis on
                  fully  realizing  the benefits of recently  completed  capital
                  projects, and

         o        Maximizing order load and optimizing product mix.



                                       10
<PAGE>

Results of Operations

         The results of operations  of the Company are largely  dependent on the
level of general  economic  activity  in China.  As  indicated  in the  overview
section,  economic  forecasts  indicate a continued fast pace growth in China in
2005. As a result,  the  consumption of our steel products is expected to remain
at a high level.  The Company's  cost of sales  includes the cost of its primary
raw materials,  steel scrap, the cost of warehousing and handling finished steel
products and freight costs. Net sales and gross profit

         Net sales for the year 2004 of $87,831,919 were a record, exceeding the
previous high of $57,305,601  set in 2003 by 35%.  Shipments in 2004 climbed 41%
to 190,936 tons, due to overall increase in market demand. Average selling price
per ton  including  sale of scrap has  increased to $460 from $418 as a combined
result  of good  market  demand  and  change  in the mix of  products  sold with
increasing  sales volume of silicon steel. In summary,  the main reasons for the
increase in sales revenue is due to an increase in selling price and an increase
in demand for steel products due to the good market conditions.

         Gross profit for the year ended  December 31, 2004 was  $6,218,732,  an
increase of 28% or $1,717,328  from $4,501,404 for the prior year. This increase
in gross  profit is mainly due to the  increase in both sales volume and selling
price outpacing the increase in raw materials price.

Cost of sales

         Overall  cost of  sales  went up to  $81,613,187  for  the  year  ended
December 31, 2004 from $52,804,197 for 2003. The increase is the combined effect
of both increases in production volume and raw material price.

         However,  cost of sales as a percent of sales  increased  from 92.1% to
92.9% due primarily to an increase in selling  price and n conversion  costs for
the year December 31, 2004 compared to 2003.

Selling, General and Administrative Expenses

         Selling,   general  and  administrative  expenses,  such  as  executive
compensation, office expenses, legal and accounting charges, travel charges, and
various taxes were $2,316,699, it represented a 34% increase from $1,532,033 for
the year ended  December 31, 2003. A large  component of the increase  came from
the legal and  accounting  charges due to the Company's  reverse  merger between
American  Construction  Company and General Steel  Investment  Co., Ltd. and our
attempt to acquire  rolling  mill  equipment  from a bankrupted  Canadian  steel
maker, the Stelco Plate Company Ltd.


                                       11
<PAGE>

Other income (expense)

         Other income  (expense) in the year ended  December 31, 2004  consisted
mainly of finance and interest charges of $1.6 million,  a $0.9 million increase
from 2003.  Outstanding  bank loans increased to $25,748,800 from $13,806,100 as
of December 31, 2004 and 2003,  respectively.  The increase in debt borrowing is
mainly  driven by  management's  decision  to pay more in advance  payments  and
deposits to suppliers to lock in a discounted raw material price.

Income taxes

         The  Company did not carry on any  business  and did not  maintain  any
branch office in the United States during the years ended  December 31, 2004 and
2003.  Therefore,  no provision for withholding or U.S.  federal income taxes or
tax benefits on the undistributed earnings and/or losses of the Company has been
made.


         Pursuant to the relevant laws and regulations in the People's  Republic
of China,  Daqiuzhuang  Metal,  as a foreign  owned  enterprise  in the People's
Republic of China,  is entitled to an exemption from the PRC  enterprise  income
tax for two years  commencing from its first  profitable year. The Company is in
the process of applying for this tax benefit.

         The  Company's  effective  state and local  income tax rate was 33% for
both the years ended December 31, 2004 and 2003. Income tax expense was $906,277
for the year ended  December  31, 2004,  up from  $767,431 in 2003 due to higher
pretax income.

Liquidity and capital resources

         Due to the good market  conditions of the steel  industry,  the Company
plans to maintain  higher-than-average  debt to equity ratio to better  position
itself in this fast growing market. The bank loans are considered short-term for
the purpose of the  preparation  of the  financial  statements  because they are
renewable with the banks every year.

Operating activities

         Net cash used in operating  activities  for the year ended December 31,
2004 was $7.3 million  compared with $0.79 million for 2003 primarily due to the
increase in  inventories  and purchase  deposits to suppliers.  Concerned by the
steady increase in raw material price,  the management  decided to pay suppliers
more in advance  payments and deposits to obtain the raw materials at discounted
prices.



                                       12
<PAGE>

Investing activities

         Net cash  provided by  investing  activities  was $762,431 for the year
ended December 31, 2004 compared with  $5,772,859  used in investing  activities
for the year ended December 31, 2003.  This change  resulted from an increase in
collections on notes receivable and a decrease in equipment purchases due to the
completion of plant facility construction.

Financing Activities

         The Company signed two new agreements with Shanghai Pufa Bank and China
Merchants Bank to borrow $6,050,000 from each. The proceeds were used to pay for
inventory purchases due to the reason noted under "OTHER INCOME (EXPENSE)."

Compliance with environmental laws and regulations

         Based on the equipment,  technologies and measures adopted, the Company
is not considered a high-pollution factory in China. The production process does
not need much water and produces only a minimal amount of chemical pollution. We
use gas-fired reheat furnaces recommended by the State Environmental  Protection
Agency to heat our raw materials and semi-finished products.

         In 2005, the Daqiuzhuang  County will order an  environmental  clean-up
campaign and will require harmless waste water discharge. In order to meet these
requirements,  we are going to invest  $50,000 to remodel our  industrial  water
recycling system to reduce new water consumption and industrial water discharge.
As for the remodeling of gas furnace and desulphurization of discharged gas, the
local  government has not posted any control  measures  currently and we have no
plans to proceed  with this  remodeling  until such time  regulations  have been
implemented.

         The Company  believes  that  future  costs  relating  to  environmental
compliance  will not have a material  adverse effect on the Company's  financial
position.  There is always the possibility,  however,  that unforeseen  changes,
such as new laws or  enforcement  policies,  could  result in  material  adverse
costs.

Impact of inflation

         We are subject to commodity price risks arising from price fluctuations
in the market prices of the raw  materials.  The Company has generally been able
to pass on cost increases  through price  adjustments.  However,  the ability to
pass on these  increases  depends  on market  conditions  driven by the  overall
economic  conditions  in China.  Price risks are managed by the Company  through
productivity  improvements and  cost-containment  measures.  Management does not
believe  that  inflation  risk is  material  to our  business  or our  financial
position, results of operations or cash flows.



                                       13
<PAGE>

Off-balance sheet arrangements

         There are currently no off-balance sheet arrangements.

Risk factors

Risks Related to Our Business

         Competition  within the steel industry is intense.  In the sale of flat
rolled carbon steel and silicon steel,  the Company competes with competitors on
the basis of product quality,  responsiveness to customer needs and price. There
are two types of steel and iron  companies  in China:  State  Owned  Enterprises
(SOEs) and privately owned companies.

         The Company  competes with both state owned and  privately  owned steel
manufacturers. While we believe that our price and quality are superior to other
manufacturers,  many of our competitors are better capitalized more experienced,
and have deeper ties in the Chinese  marketplace.  We may be unsuccessful in our
attempts to compete,  which would have a material adverse impact on our business
and financial  condition.  The Company considers there to be 5 major competitors
of similar  size,  production  capability  and product line in the market place:
Henan Anyang Metal Sheet Plant, Nanjing Metal Sheet Plant, Tianjin No. 1 Rolling
Steel Plant,  Tianjin  Yinze Metal Sheet Plant and Tangshan  Fengrun Metal Sheet
Plant.  With the PRC's  entry into the World  Trade  Organization  and the PRC's
agreements  to lift many of the  barriers  to foreign  competition,  the Company
believes that  competition will increase in the PRC auto parts market as a whole
with the entry of foreign companies to the market.

         Our limited  operating  history  may not serve as an adequate  basis to
judge our future prospects and results of operations.

         We began our operations in 2000. Our limited  operating history may not
provide a  meaningful  basis on which to evaluate  our  business.  Although  our
revenues have grown rapidly since  inception,  we cannot assure you that we will
maintain our  profitability  or that we will not incur net losses in the future.
We  expect  that  our  operating  expenses  will  increase  as  we  expand.  Any
significant  failure to  realize  anticipated  revenue  growth  could  result in
significant   operating   losses.  We  will  continue  to  encounter  risks  and
difficulties   frequently  experienced  by  companies  at  a  similar  stage  of
development, including our potential failure to:

         o        Implement our business model and strategy and adapt and modify
                  them as needed;

         o        Increase  awareness of our brands,  protect our reputation and
                  develop customer loyalty;


                                       14
<PAGE>

         o        Manage  our  expanding   operations  and  service   offerings,
                  including the integration of any future acquisitions;

         o        Maintain adequate control of our expenses;

         o        Anticipate and adapt to changing  conditions in the auto parts
                  markets  in  which we  operate  as well as the  impact  of any
                  changes in government regulation,

         o        Mergers   and   acquisitions    involving   our   competitors,
                  technological  developments and other significant  competitive
                  and market dynamics.

         If we are not successful in addressing any or all of these risks, our
         business may be materially and adversely affected.

         Our  inability  to  fund  our  capital  expenditure   requirements  may
adversely affect our growth and profitability.

         Our  continued  growth is dependent  upon our ability to raise  capital
from outside sources. We believe that in order to continue to capture additional
market  share,  we will have to increase  our  production  capacity  through the
purchase of machinery and equipment with a value of  approximately  $10 million.
In the future we may be unable to obtain  the  necessary  financing  on a timely
basis and on acceptable terms, and our failure to do so may adversely affect our
financial position, competitive position, growth and profitability.  Our ability
to obtain  acceptable  financing  at any time may depend on a number of factors,
including:

         o        - Our financial condition and results of operations,
         o        - The  condition  of the PRC economy and the auto  industry in
                  the PRC, and
         o        - Conditions in relevant  financial  markets in the U.S.,  the
                  PRC and elsewhere in the world.

         We may not be able to effectively control and manage our growth.

         If our business and markets grow and develop,  it will be necessary for
us to finance and manage expansion in an orderly fashion.  This growth will lead
to an increase in the  responsibilities  of  existing  personnel,  the hiring of
additional  personnel and expansion of our scope of operations.  There can be no
assurance  that we will be able to raise the  required  financing or control and
manage this future growth.

         We depend on large contracts and a concentration of customers.

         Our revenue is dependent,  in large part, on significant contracts from
a limited  number of customers.  During the fiscal year ended  December 31, 2004
approximately 40% of sales were to five customers and approximately 20% of sales
were to one  customer.  We believe that revenue  derived from current and future
large  customers  will continue to represent a significant  portion of our total


                                       15
<PAGE>

revenue. Our inability to continue to secure and maintain a sufficient number of
large contracts would have a material adverse effect on our business,  operating
results and financial condition.  Moreover, our success will depend in part upon
our  ability  to obtain  orders  from new  customers,  as well as the  financial
condition and success of our customers and general economic conditions.


         We may not be able to pass on to  customers  increases  in the costs of
our raw materials, particularly iron and steel.

         The major raw materials  that we purchase for  production  are iron and
steel.  The price and  availability of these raw materials are subject to market
conditions  affecting supply and demand.  Our financial  condition or results of
operations  may be impaired by further  increases in raw  material  costs to the
extent we are unable to pass those higher costs to our  customers.  In addition,
if these  materials are not available on a timely basis or at all, we may not be
able to produce our products and our sales may decline.

         Risks Related to Operating Our Business in China

         We face the risk that changes in the policies of the Chinese government
could have  significant  impact  upon the  business we may be able to conduct in
China and the profitability of such business.

         The  economy of China is at a  transition  from a planned  economy to a
market  oriented  economy  subject to five-year  and annual plans adopted by the
government that set down national economic  development  goals.  Policies of the
Chinese  government can have significant  effects on the economic  conditions of
China.  The Chinese  government  has confirmed  that economic  development  will
follow a model of market  economy  under  socialism.  Under this  direction,  we
believe  that the PRC will  continue  to  strengthen  its  economic  and trading
relationships  with foreign  countries  and business  development  in China will
follow market forces. While we believe that this trend will continue,  there can
be no assurance  that such will be the case. A change in policies by the Chinese
government  could  adversely  affect our  interests in by, among other  factors:
changes  in  laws,  regulations  or  the  interpretation  thereof;  confiscatory
taxation;  restrictions on currency conversion,  imports or sources of supplies;
or the expropriation or  nationalization  of private  enterprises.  Although the
Chinese  government has been pursuing economic reform policies for approximately
two decades,  there is no assurance that the government  will continue to pursue
such policies or that such policies may not be significantly altered, especially
in the event of a change in leadership, social or political disruption, or other
circumstances affecting China's political, economic and social life.

         The PRC laws and regulations  governing our current business operations
and  contractual  arrangements  are  uncertain,  and  if we are  found  to be in
violation,  we could be subject to sanctions.  In addition,  any changes in such
PRC laws and regulations may have a material and adverse effect on our business.



                                       16
<PAGE>

         There are substantial  uncertainties  regarding the  interpretation and
application of PRC laws and  regulations,  including but not limited to the laws
and  regulations  governing our business,  or the enforcement and performance of
our  arrangements  with  customers in the event of the  imposition  of statutory
liens, death,  bankruptcy and criminal proceedings.  Our subsidiaries and we are
considered  foreign persons or foreign funded enterprises under PRC laws, and as
a result,  we are required to comply with PRC laws and  regulations.  These laws
and  regulations  are relatively new and may be subject to future  changes,  and
their  official   interpretation   and  enforcement   may  involve   substantial
uncertainty.  The effectiveness of newly enacted laws, regulations or amendments
may be delayed, resulting in detrimental reliance by foreign investors. New laws
and regulations that affect existing and proposed future  businesses may also be
applied retroactively.  In addition, the PRC authorities retain broad discretion
in dealing with  violations of laws and  regulations,  including  levying fines,
revoking business  licenses and requiring  actions necessary for compliance.  In
particular,  licenses, permits and beneficial treatments issued or granted to us
by relevant  governmental  bodies may be revoked at a later time under  contrary
findings  of  higher  regulatory  bodies.  We cannot  predict  what  effect  the
interpretation  of  existing  or new PRC  laws or  regulations  may  have on our
businesses.  We cannot assure you that any such restructuring would be effective
or would not  result in  similar  or other  difficulties.  We may be  subject to
sanctions, including fines, and could be required to restructure our operations.
As a result of these substantial uncertainties, we cannot assure you hat we will
not be found in violation of any current or future PRC laws or regulations.

         A  slowdown  or  other  adverse  developments  in the PRC  economy  may
materially and adversely  affect our customers,  demand for our services and our
business.

         All of our  operations are conducted in the PRC and all of our revenues
are generated  from sales to businesses  operating in the PRC.  Although the PRC
economy has grown  significantly in recent years, we cannot assure you that such
growth will continue.  The automotive  industry in the PRC is relatively new and
growing,  but we do not know how  sensitive  we are to a  slowdown  in  economic
growth or other  adverse  changes in the PRC economy which may affect demand for
cars and  trucks,  and  therefore,  auto parts.  A slowdown in overall  economic
growth, an economic downturn or recession or other adverse economic developments
in the PRC may materially  reduce the demand for our products and materially and
adversely affect our business.

         Inflation  in China  could  negatively  affect  our  profitability  and
growth.

         While the Chinese economy has experienced rapid growth, such growth has
been uneven among various  sectors of the economy and in different  geographical
areas of the  country.  Rapid  economic  growth  can lead to growth in the money
supply and rising  inflation.  If prices for our products rise at a rate that is



                                       17
<PAGE>

insufficient to compensate for the rise in the costs of supplies, it may have an
adverse effect on profitability.  In order to control inflation in the past, the
Chinese  government  has imposed  controls on bank credits,  limits on loans for
fixed assets and  restrictions on state bank lending.  Such an austerity  policy
can lead to a slowing of economic growth.  In October 2004, the People's Bank of
China,  China's central bank, raised interest rates for the first time in nearly
a  decade  and  indicated  in a  statement  that the  measure  was  prompted  by
inflationary  concerns in the Chinese  economy.  Repeated  increases in interest
rates by the  central  bank will likely  slow  economic  activity in China which
could,  in turn,  materially  increase our costs and also reduce  demand for our
products.

         Governmental  control of  currency  conversion  may affect the value of
your investment.

         The PRC government  imposes controls on the  convertibility of Renminbi
into foreign currencies and, in certain cases, the remittance of currency out of
the PRC. We receive  substantially  all of our  revenues in  Renminbi,  which is
currently not a freely  convertible  currency.  Shortages in the availability of
foreign currency may restrict our ability to remit  sufficient  foreign currency
to pay dividends, or otherwise satisfy foreign currency denominated obligations.
Under existing PRC foreign  exchange  regulations,  payments of current  account
items,  including profit distributions,  interest payments and expenditures from
the transaction,  can be made in foreign  currencies without prior approval from
the PRC State  Administration  of Foreign  Exchange by  complying  with  certain
procedural  requirements.   However,   approval  from  appropriate  governmental
authorities is required where Renminbi is to be converted into foreign  currency
and remitted out of China to pay capital  expenses such as the repayment of bank
loans denominated in foreign currencies.

         The PRC government may also at its  discretion  restrict  access in the
future to foreign  currencies for current account  transactions.  If the foreign
exchange control system prevents us from obtaining  sufficient  foreign currency
to  satisfy  our  currency  demands,  we may not be able to pay  certain  of our
expenses as they come due.

         The  fluctuation of the Renminbi may  materially  and adversely  affect
your investment.

         The value of the Renminbi  against the U.S. dollar and other currencies
may  fluctuate  and is affected  by,  among other  things,  changes in the PRC's
political and economic conditions. As we rely entirely on revenues earned in the
PRC, any  significant  revaluation  of the Renminbi may materially and adversely
affect our cash flows,  revenues and financial  condition.  For example,  to the
extent that we need to convert  U.S.  dollars we receive from an offering of our
securities  into  Renminbi  for our  operations,  appreciation  of the  Renminbi
against the U.S.  dollar could have a material  adverse  effect on our business,
financial condition and results of operations.

         Conversely,  if we decide to convert our Renminbi into U.S. dollars for
the purpose of making  payments for  dividends on our common shares or for other
business purposes and the U.S. dollar appreciates against the Renminbi, the U.S.



                                       18
<PAGE>

dollar equivalent of the Renminbi we convert would be reduced. To date, however,
we  have  not  engaged  in  transactions  of  either  type.  In  addition,   the
depreciation  of significant  U.S. dollar  denominated  assets could result in a
charge to our income statement and a reduction in the value of these assets.

         Since  1994 the PRC has pegged  the value of the  Renminbi  to the U.S.
dollar.  We do not  believe  that this  policy has had a material  effect on our
business.  However,  there have been  indications that the PRC government may be
reconsidering  its monetary  policy in light of the overall  devaluation  of the
U.S. dollar against the Euro and other currencies  during the last two years. If
the pegging of the Renminbi to the U.S.  dollar is loosened we  anticipate  that
the value of the Renminbi  would likely  appreciate  against the dollar with the
consequences discussed above.

         The PRC legal system has inherent  uncertainties  that could materially
and adversely affect us.

         The PRC legal  system  is based  upon  written  statutes.  Prior  court
decisions may be cited for reference but are not binding on subsequent cases and
have limited value as precedents.  Since 1979, the PRC  legislative  bodies have
promulgated  laws and regulations  dealing with economic matters such as foreign
investment, corporate organization and governance, commerce, taxation and trade.
However, the PRC has not developed a fully integrated legal system and the array
of new laws and  regulations  may not be  sufficient  to cover  all  aspects  of
economic  activities  in  the  PRC.  In  particular,   because  these  laws  and
regulations  are relatively  new, and because of the limited volume of published
decisions and their non-binding  nature,  the  interpretation and enforcement of
these  laws  and  regulations  involve  uncertainties.  In  addition,  published
government policies and internal rules may have retroactive effects and, in some
cases,  the policies and rules are not published at all. As a result,  we may be
unaware of our violation of these policies and rules until some time later.  The
laws  of the  PRC  govern  our  contractual  arrangements  with  our  affiliated
entities.  The enforcement of these contracts and the interpretation of the laws
governing these relationships are subject to uncertainty.

         Risks Related to Our Common Stock

         Our  officers,  directors  and  affiliates  control  us  through  their
positions  and stock  ownership  and  their  interests  may  differ  from  other
stockholders.

         Our officers,  directors and affiliates  beneficially own approximately
96% of our common stock. Mr. Yu, Zuo Sheng our major  shareholder,  beneficially
owns  approximately  96% of our  common  stock  and is the  selling  stockholder
herein.  Mr. Yu can  effectively  control us and his  interests  may differ from
other stockholders



                                       19
<PAGE>

         Because our principal  assets are located  outside of the United States
and all of our directors and officers  reside outside of the United  States,  it
may be difficult for you to enforce your rights based on U.S. federal securities
laws against us and our officers and directors in the U.S. or enforce U.S. court
judgments against us or them in the PRC.

         All of our directors and officers  reside outside of the United States.
In  addition,  Daqiuzhuang,  our  operating  subsidiary,  is  located  in  China
substantially all of its assets are located outside of the United States. It may
therefore be difficult for investors in the United States to enforce their legal
rights based on the civil liability  provisions of the U.S.  federal  securities
laws against us in the courts of either the U.S. and the PRC and,  even if civil
judgments are obtained in U.S. courts,  to enforce such judgments in PRC courts.
Further, it is unclear if extradition  treaties now in effect between the United
States and the PRC would permit effective enforcement against us or our officers
and directors of criminal  penalties under the U.S.  federal  securities laws or
otherwise.

         We have  never paid cash  dividends  and are not likely to do so in the
foreseeable future.

         We  currently  intend  to retain  any  future  earnings  for use in the
operation  and  expansion  of our  business.  We do not  expect  to pay any cash
dividends in the foreseeable future but will review this policy as circumstances
dictate.

         There is only a limited trading market for our common stock.

         Our common stock is now listed on the over-the-counter  Bulletin Board.
There is  currently  limited  trading  market for our common stock and we do not
know if any  trading  market will ever  develop.  You may be unable to sell your
shares due to the absence of a trading market.

         In addition,  broker-dealers  who  recommend our common stock to people
who are not  established  customers or qualifying  investors must follow special
sales procedures, including getting the purchaser's written consent prior to the
sale. Our common stock is also subject to the "penny stock" rules, which require
delivery  of a schedule  explaining  the penny stock  market and the  associated
risks before any sale.  See "MARKET PRICE OF AND  DIVIDENDS ON THE  REGISTRANT'S
COMMON EQUITY AND RELATED  STOCKHOLDER  MATTERS." These requirements may further
limit your ability to sell your shares.

         Our common stock is illiquid and subject to price volatility  unrelated
to our operations.

         The market price of our common stock could fluctuate  substantially due
to a variety of factors,  including market  perception of our ability to achieve
our planned  growth,  quarterly  operating  results of other auto parts  makers,
trading volume in our common stock, changes in general conditions in the economy
and the financial markets or other developments affecting our competitors or us.



                                       20
<PAGE>

In  addition,   the  stock  market  is  subject  to  extreme  price  and  volume
fluctuations.  This volatility has had a significant  effect on the market price
of securities  issued by many companies for reasons unrelated to their operating
performance and could have the same effect on our common stock.














                                       21
<PAGE>

Item 7.  Financial statements
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


The Board of Directors
General Steel Holdings, Inc. and Subsidiaries
(Formerly known as American Construction Company)

We have audited the accompanying balance sheets of General Steel Holdings,  Inc.
(Formerly known as American Construction Company)and subsidiaries as of December
31, 2004 and 2003, and the related statements of income and other  comprehensive
income (loss),  shareholders'  equity and cash flows for years then ended. These
financial  statements are the  responsibility of the Company's  management.  Our
responsibility  is to express an opinion on these financial  statements based on
our audits.

We conducted  our audits in  accordance  with  standards  of the Public  Company
Accounting  Oversight Board (United States of America).  Those standards require
that we plan and perform the audit to obtain reasonable  assurance about whether
the financial statements are free of material  misstatement.  The Company is not
required  to have,  nor were we engaged  to  perform,  an audit of its  internal
control over financial reporting.  Our audit included  consideration of internal
control over financial  reporting as a basis for designing audit procedures that
are appropriate in the  circumstances,  but not for the purpose of expressing an
opinion on the  effectiveness  of the Company's  internal control over financial
reporting. Accordingly, we express no such opinion. An audit includes examining,
on a  test  basis,  evidence  supporting  the  amounts  and  disclosures  in the
financial statements. An audit also includes assessing the accounting principles
used and  significant  estimates made by  management,  as well as evaluating the
overall financial statement  presentation.  We believe that our audits provide a
reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects,  the financial  position of General Steel Holdings,  Inc.
and  subsidiaries  as of December  31,  2004 and 2003,  and the results of their
operations  and their cash flows for the years  then  ended in  conformity  with
accounting principles generally accepted in the United States of America.

/s/ Moore Stephens Wurth Frazer and Torbet, LLP

Moore Stephens Wurth Frazer and Torbet, LLP
Certified Public Accountants

February 26, 2005
Walnut, California



To The Board of Directors
General Steel Holdings, Inc.
(Formerly known as American Construction Company)


                       Consent of Independent Accountants
                           General Steel Holdings, Inc
                (Formerly known as American Construction Company)
                          Audited Financial Statements
                           December 31, 2004 and 2003


         We consent to the  incorporation  in the Annual Report of General Steel
Holdings,  Inc on Form 10-K of our report dated  February 26, 2005 on our audits
of the financial  statements of General Steel Holdings,  Inc. (Formerly known as
American Construction Company)and subsidiaries as of December 31, 2004 and 2003,
and for the years then ended,  which our reports  are  incorporated  in the Form
10-K.


 /s/ Moore Stephens Wurth Frazer and Torbet, LLP
------------------------------------------------
Moore Stephens Wurth Frazer and Torbet, LLP


Walnut, California
March 30, 2005


                                       22

<PAGE>




<PAGE>
<TABLE>
<CAPTION>

                  GENERAL STEEL HOLDINGS, INC. AND SUBSIDIARIES
                (FORMERLY KNOWN AS AMERICAN CONSTRUCTION COMPANY)


                           CONSOLIDATED BALANCE SHEETS
                        AS OF DECEMBER 31, 2004 AND 2003
                                     ASSETS
                                                                     2004           2003
                                                                 ------------   ------------
<S>                                                              <C>            <C>
CURRENT ASSETS:
  Cash                                                           $  5,547,810   $  1,606,704
  Restricted cash                                                   3,597,480      2,096,370
  Accounts receivable, net of allowance for doubtful accounts
    of $1,371 as of December 31, 2004 and December 31, 2003           523,398        455,641
  Notes receivable                                                    374,955      1,188,854
  Other receivables                                                   214,905        328,271
  Other receivables - related parties
                                                                         --          459,800
  Inventories                                                      12,826,561      4,801,915
  Advances on inventory purchases - related parties                      --        1,021,824
  Advances on inventory purchases                                  13,469,984      7,831,480
  Short-term investment                                                36,300         12,100
                                                                 ------------   ------------
    Total current assets                                           36,591,393      9,802,959
                                                                 ------------   ------------

PLANT AND EQUIPMENT, net                                           14,100,324     15,064,160
                                                                 ------------   ------------

OTHER ASSETS:
  Intangible assets - land use right, net of accumulated
     amortization                                                   2,277,279      2,564,369
                                                                 ------------   ------------

      Total assets                                               $ 52,968,996   $ 37,431,488
                                                                 ============   ============

                      LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES:
  Accounts payable                                               $    293,348   $  1,378,484
  Short term loans - bank                                          25,748,800     13,806,100
  Short term notes payable                                          6,776,000      6,709,450
  Other payables                                                      400,110        208,308
  Other payable - related party                                     1,011,012           --
  Accrued liabilities                                                 393,532         60,656
  Customer deposits                                                 2,009,313        914,160
Deposits due to sales representatives                               1,231,780        862,730
  Taxes payable                                                     1,879,615      1,655,842
                                                                 ------------   ------------
    Total current liabilities                                      39,743,510     25,595,730
                                                                 ------------   ------------

MINORITY INTEREST                                                   4,015,108      3,550,728
                                                                 ------------   ------------

SHAREHOLDERS' EQUITY:
  Common Stock, $.001 par value, 75,000,000 shares authorized,
    31,250,000 shares issued and outstanding in 2004 and
    10,000 shares issued and outstanding in 2003                       31,250         10,000
  Paid-in-capital                                                   6,871,358      6,892,258
  Retained earnings                                                 2,152,976      1,392,772
  Statutory reserves                                                  154,794           --
  Stock receivable                                                       --          (10,000)
                                                                 ------------   ------------
    Total shareholders' equity                                      9,210,378      8,285,030
                                                                 ------------   ------------
      Total liabilities and shareholders' equity                 $ 52,968,996   $ 37,431,488
                                                                 ============   ============
</TABLE>



                                       23
<PAGE>

                  GENERAL STEEL HOLDINGS, INC. AND SUBSIDIARIES
                (FORMERLY KNOWN AS AMERICAN CONSTRUCTION COMPANY)

        CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME
                 FOR THE YEARS ENDED DECEMBER 31, 2004 AND 2003

                                                       2004            2003
                                                   ------------    ------------

SALES REVENUE                                      $ 87,831,919    $ 57,305,601

COST OF SALES                                        81,613,187      52,804,197
                                                   ------------    ------------

GROSS PROFIT                                          6,218,732       4,501,404

SELLING, GENERAL AND  ADMINISTRATIVE EXPENSES         2,316,699       1,532,033
                                                   ------------    ------------

INCOME FROM OPERATIONS                                3,902,033       2,969,371


OTHER INCOME (EXPENSE), NET                          (1,616,377)       (643,807)
                                                   ------------    ------------

INCOME BEFORE PROVISION FOR INCOME TAXES
     AND MINORITY INTEREST                            2,285,656       2,325,564


PROVISION FOR INCOME TAXES                              906,277         767,431
                                                   ------------    ------------

NET INCOME BEFORE MINORITY INTEREST                   1,379,379       1,558,133


MINORITY INTEREST                                       464,381         467,440
                                                   ------------    ------------


NET INCOME                                              914,998       1,090,693

OTHER COMPREHENSIVE INCOME (LOSS):

    Foreign currency translation adjustment                --              --
                                                   ------------    ------------


COMPREHENSIVE INCOME                               $    914,998    $  1,090,693
                                                   ============    ============


EARNINGS PER SHARE, BASIC AND DILUTED              $       0.07    $       0.12
                                                   ============    ============

WEIGHTED AVERAGE NUMBER OF SHARES                    13,594,890       9,175,000
                                                   ============    ============




                                       24


<PAGE>
<TABLE>
<CAPTION>

                  GENERAL STEEL HOLDINGS, INC. AND SUBSIDIARIES
                (FORMERLY KNOWN AS AMERICAN CONSTRUCTION COMPANY)

                 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
                 FOR THE YEARS ENDED DECEMBER 31, 2004 AND 2003

                                     Number         Common        Paid-in        Statutory
                                    of shares        stock        capital         reserves
                                   -----------    -----------    -----------    -----------
<S>                                <C>            <C>            <C>            <C>
BALANCE, January 1, 2003             9,175,000    $    10,000    $ 6,892,433    $      --

  Net income                              --             --             --             --
                                   -----------    -----------    -----------    -----------

BALANCE, December 31, 2003           9,175,000         10,000      6,892,433           --

  Net income                              --             --             --             --
  Adjustment to statutory reserve         --             --             --          154,794
  Cash received                           --             --             --             --
  Stock issued for services             35,000             35            140           --
  Issuance of common stock to-
  General Steel
    Investment Co., Ltd
    shareholders
    due to
    reorganization                  22,040,000         21,215        (21,215)          --
                                   -----------    -----------    -----------    -----------
BALANCE, December 31, 2004          31,250,000    $    31,250    $ 6,871,358    $   154,794
                                   ===========    ===========    ===========    ===========


                                     Retained        Stock      comprehensive
                                     earnings      receivable   income (loss)     Totals
                                   -----------    -----------    -----------    -----------

BALANCE, January 1, 2003           $   302,079    $   (10,000)   $      --      $ 7,194,512

  Net income                         1,090,693           --             --        1,090,693
                                   -----------    -----------    -----------    -----------

BALANCE, December 31, 2003           1,392,772        (10,000)          --        8,285,205

  Net income                           914,998           --             --          914,998
  Adjustment to statutory reserve     (154,794)          --             --             --
  Cash received                           --           10,000           --           10,000
  Stock issued for services               --             --             --              175
  Issuance of common stock to-
  General Steel
    Investment Co., Ltd
    shareholders
    due to
    reorganization                        --             --             --             --
                                   -----------    -----------    -----------    -----------
BALANCE, December 31, 2004         $ 2,152,976    $      --      $      --      $ 9,210,378
                                   ===========    ===========    ===========    ===========
</TABLE>




                                       25

<PAGE>
<TABLE>
<CAPTION>

                  GENERAL STEEL HOLDINGS, INC. AND SUBSIDIARIES


                (FORMERLY KNOWN AS AMERICAN CONSTRUCTION COMPANY)
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                 FOR THE YEARS ENDED DECEMBER 31, 2004 AND 2003

                                                                 2004            2003
                                                             ------------    ------------
<S>                                                          <C>             <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
 Net income                                                  $    914,998    $  1,090,693
 Adjustments to reconcile net income to cash
  provided by (used in) operating activities:
   Minority Interest                                              467,440
   Depreciation                                                   968,332         916,003
   Amortization                                                   287,090          96,800
   Loss on disposal of equipment                                   22,947            --
   Stock issued for services                                          175            --
  (Increase) decrease in assets:
   Accounts receivable                                            (67,757)      1,100,324
   Other receivables                                              113,366       2,190,150
   Other receivables-related parties                              459,800            --
   Inventories                                                 (8,024,646)       (709,723)
   Purchase deposits-related party                              1,021,824       3,237,005
   Deposits                                                    (5,638,504)     (6,321,289)
  Increase (decrease) in liabilities:
   Accounts payable                                            (1,085,136)        943,579
   Other payables                                                 191,802            --
   Other payables-related party                                 1,011,012      (1,414,526)
   Accrued liabilities                                            332,876      (1,086,810)
   Customer deposits                                            1,095,153      (1,700,867)
   Deposits due to sales representatives                          369,050        (364,210)
   Taxes payable                                                  223,773         765,098
                                                             ------------    ------------
    Net cash used in operating activities                      (7,339,465)       (790,333)
                                                             ------------    ------------

CASH FLOWS FROM INVESTING ACTIVITIES:
 (Increase) decrease in notes receivable                          813,899      (1,188,854)
 Increase in short term investment                                (24,200)           --
 Equipment purchases                                             (253,426)     (2,681,103)
 Proceeds from sales of equipment                                 226,158            --
 Increase in land use right                                          --        (1,902,902)
                                                             ------------    ------------
    Net cash provided by (used in) investing activities           762,431      (5,772,859)
                                                             ------------    ------------

CASH FLOWS FROM FINANCING ACTIVITIES:
 Borrowings,  net of payments on short term loans -
 bank                                                          11,942,700       3,182,300
 Borrowings, net of payments on short term notes payable           66,550       2,191,310
 Decrease in stock receivable                                      10,000            --
                                                             ------------    ------------
    Net cash provided by financing activities                  12,019,250       5,373,610
                                                             ------------    ------------

INCREASE (DECREASE) IN CASH                                     5,442,216      (1,189,582)

CASH, beginning of year                                         3,703,074       4,892,656
                                                             ------------    ------------

CASH, end of year                                            $  9,145,290    $  3,703,074
                                                             ============    ============
</TABLE>


                                       26
<PAGE>

Note 1 - Background

On March 7, 2005,  General Steel Holdings,  Inc. (the Company)  formally changed
its name from American Construction Company to General Steel Holdings, Inc.

The Company was  established on August 5, 2002 for the purpose of commencing the
business of general construction  contracting.  It is the Company's objective to
provide to its customers  timely and durable  construction of their  residential
and commercial needs. We established our subsidiary for the purpose of achieving
our  above  stated  objectives  in  Saskatchewan,  Canada.  We  established  our
subsidiary to enter the residential and commercial construction industry in this
market.

To  accomplish  the above  objective  the  founder  of our  company,  Jeff Mabry
established American  Construction Company (a Nevada company) on August 5, 2002.
American  Construction  Company  then  established  its  subsidiary,   West  Dee
Construction  Ltd.  (a  Saskatchewan,  Canada  Company)  on  August  8,  2002 by
purchasing 100 shares from its treasury.

On October 14, 2004, American  Construction Company and General Steel Investment
Co., Ltd (referred to as General Steel) and Northwest  Steel  Company,  a Nevada
corporation,  entered  into an  Agreement  and Plan of Merger (the  "Agreement")
pursuant to which American Construction Company acquired General Steel, and it's
70% ownership in its subsidiary Daqiuzhuang Metal Sheet Co., Ltd in exchange for
shares of the  Company's  common  stock,  of which  22,040,000  shares are a new
issuance by the Company,  and 7,960,000 shares are from certain  shareholders of
the  Company,  which  in  aggregate,  constitute  96% of the  total  issued  and
outstanding shares of the Company.

Under  the  terms of the  Agreement,  General  Steel  will  remain a 100%  owned
subsidiary of the Company.  The  transaction  contemplated  by the Agreement was
intended to be a" tax-free" reorganization pursuant to the provisions of Section
351 and  368(a)(1)(A)  of the  Internal  Revenue Code of 1986,  as amended.  The
stockholders  of  General  Steel,  as of the  closing  date  of the  merger  own
approximately  96% of the Company's  common stock  outstanding as of October 15,
2004  (excluding  any  additional  shares to be issued on  outstanding  options,
warrants and other securities convertible into common stock).

The  accounting  for these  transactions  is identical to that  resulting from a
reverse-acquisition,  except  that no  goodwill  or other  intangible  assets is
recorded. Accordingly, the financial statements of General Steel Investment Co.,
Limited are the  historical  financial  statements of the Company,  formerly the
operations of Daqiuzhuang Metal Sheet Co., Ltd.

Daqiuzhuang  Metal  Sheet  Co.,  Ltd.  (referred  to as  Daqiuzhuang  Metal) was
established on August 18, 2000 in Jinghai county,  Tianjin city, Hebei province,
the People's Republic of China (PRC). The Articles of Corporation provides for a
10 year operating term beginning on August 18, 2000 with registered capital of $
9,583,200.  The Company is a Chinese registered limited liability company with a
legal structure  similar to a limited  liability  company  organized under state
laws in the United States of America.


                                       27

<PAGE>

Tianjin Long Yu Trading  Material  Co.,  Ltd was the majority  owner with 71% of
ownership  interest.  Tianjin Long Yu Trading Material Co., Ltd was incorporated
in 2000 in Tianjin Municipality, Daqiuzhuang County; P.R.C. Mr. Yu Zuo Sheng has
90% of ownership interest in Tianjin Long Yu Trading Material Co., Ltd.

During January 2004, upon the board directors' approval, Tianjin Long Yu Trading
Material Co., Ltd and other minority shareholders sold their interests amounting
to 70% to  Yang Pu  Capital  Automotive  Investment  Limited.  Yang  Pu  Capital
Automotive  Investment Limited is a Chinese registered limited liability company
which is 100% indirectly owned by Mr. Yu Zuo Sheng.

On May 16, 2004,  Company  agreed to purchase  Yang Pu's 70% equity  interest in
Daqiuzhuang   Metal  for  the  amount  of  RMB55.45   million  or  approximately
USD$6,709,450.  The entire  purchase  price is to be paid within one year of the
new business  license  being  issued  which is June 25, 2004.  Due to the common
ownership by Mr. Yu Zuo Sheng in both General Steel Investment Co., Ltd and Yang
Pu Capital Automotive  Investment  Limited,  the Company's board of directors by
board resolution dated May 16, 2004 has instructed Mr. Yu Zuo Sheng as the 99.9%
shareholder  of  General  Steel on  behalf  of the  Company  to remit  the total
purchase price to Yang Pu from his personal funds. Mr. Yu Zuo Sheng will receive
no compensation for completing this transaction nor will General Steel reimburse
Mr. Yu Zuo Sheng for the  $6,709,450.  As of December 31, 2004, Mr. Yu Zuo Sheng
has paid  the  entire  purchase  price to Yang Pu.  Because  the  entities  have
essentially  the same owner,  Mr. Yu Zuo Sheng and the entities are under common
control,  the transfer of ownership is accounted for at  historical  costs under
guidance of SFAS No. 141. The Company received a new business license certifying
the new ownership structure as a Chinese Foreign Joint Venture on June 25, 2004.

The purchase of Yang Pu's 70% equity  interest and the issuance of the Company's
common stock have been  accounted  for as a reverse  acquisition  presented as a
recapitalization, except no goodwill or the intangible assets are recorded.

Based on the Company's Plan of Merger with General Steel, the Board of Directors
determined  to  change  the  Registrant's  fiscal  year end from  January  31 to
December 31.

The Company through its subsidiary  Daqiuzhuang Metal principally engages in the
manufacturing  of hot rolled  carbon and silicon  steel  sheets which are mainly
used on tractors,  agricultural  vehicles and in other  specialty  markets.  The
Company sells its products through both retailers and wholesalers.


Note 2 - Summary of significant accounting policies

Basis of presentation
---------------------

The consolidated  financial statements of American  Construction Company reflect
the activities of the following subsidiaries:




                                       28
<PAGE>

                                                                      Pecentage
          Subsidiary                                                Of Ownership
-----------------------------------------------------------------   ------------
General Steel Investment Co., Ltd.         British Virgin Islands       100.0%
Tianjin Daqiuzhuang Metal Sheet Co., Ltd   P.R.C.                        70.0%


The  consolidated  financial  statements have been presented as if the Agreement
and Plan of Merger of the  subsidiary  occurred  during  the year of 2003 due to
common management and ownership.

The consolidated  financial  statements generally reflect only the activities of
Tianjin  Daqiuzhuang  Metal Sheet Co., Ltd at its historical cost since American
Construction  and General Steel  Investment  Co., Ltd had no activities  for the
years ended December 31, 2004 and 2003, respectively.

Revenue recognition
-------------------

The  Company  recognizes  revenue  when the  goods are  delivered  and title has
passed.  Sales  revenue  represents  the  invoiced  value  of  goods,  net  of a
value-added  tax (VAT).  All of the Company's  products that are sold in the PRC
are  subject to a Chinese  value-added  tax at a rate of 17% of the gross  sales
price.  This VAT may be offset by VAT paid by the Company on raw  materials  and
other materials included in the cost of producing their finished product.

Foreign currency translation
----------------------------

The reporting  currency of the Company is the US dollar.  The Company uses their
local currency, Renminbi (RMB), as their functional currency.

Results of operations  and cash flow are  translated at average  exchange  rates
during the period,  and assets and  liabilities  are  translated  at the unified
exchange  rate as quoted by the People's Bank of China at the end of the period.
Translation  adjustments resulting from this process are included in accumulated
other comprehensive income in the statement of shareholders' equity. Transaction
gains and losses that arise from  exchange  rate  fluctuations  on  transactions
denominated in a currency other than the functional currency are included in the
results of  operations  as  incurred.  These  amounts  are not  material  to the
financial statements.

Plant and equipment, net
------------------------

Plant  and  equipment  are  stated  at  cost  less   accumulated   depreciation.
Depreciation  is computed  using the  straight-line  method  over the  estimated
useful lives of the assets with 3% residual value. The depreciation  expense for
the years ended  December 31, 2004 and 2003  amounted to $968,332 and  $916,003,
respectively.




                                       29
<PAGE>

Estimated useful lives of the assets are as follows:

                                                     Estimated
                                                    Useful Life
                                                    -----------
Buildings                                           10-30 years
Machinery and equipment                              8-15 years
Other equipment                                      5-8 years
Transportation equipment                            10-15 years


Construction  in progress  represents the costs incurred in connection  with the
construction of buildings or new additions to the Company's plant facilities. No
depreciation  is provided for  construction  in progress  until such time as the
assets are completed and are placed into service.

The cost and  related  accumulated  depreciation  of  assets  sold or  otherwise
retired are eliminated from the accounts and any gain or loss is included in the
statements of  operations.  Maintenance,  repairs and minor renewals are charged
directly to expenses as incurred.  Major  additions and  betterment to buildings
and equipment are capitalized.

Long-term  assets of the  Company  are  reviewed  annually  as to whether  their
carrying value has become impaired.  The Company considers assets to be impaired
if the  carrying  value  exceeds the future  projected  cash flows from  related
operations.  The  Company  also  re-evaluates  the  periods of  amortization  to
determine whether subsequent events and circumstances  warrant revised estimates
of useful lives. As of December 31, 2004, the Company expects these assets to be
fully recoverable.

Plant and equipment consist of the following at December 31:

                                                           2004          2003
                                                       -----------   -----------
Buildings and improvements                             $ 5,089,350   $ 4,965,626
Transportation equipment                                   240,847       627,870
Machinery                                               12,294,697    12,181,102
                                                       -----------   -----------
              Totals                                    17,624,894    17,774,598
Less accumulated depreciation                            3,524,570     2,710,438
                                                       -----------   -----------
              Totals                                   $14,100,324   $15,064,160
                                                       ===========   ===========


Use of estimates
----------------

The preparation of financial  statements in conformity  with generally  accepted
accounting  principles  of the United States of America  requires  management to
make estimates and assumptions  that affect the amounts reported in the combined
financial  statements  and  accompanying  notes.  Management  believes  that the
estimates  utilized in preparing its financial  statements  are  reasonable  and
prudent. Actual results could differ from these estimates.



                                       30
<PAGE>

Recently issued accounting pronouncements
-----------------------------------------

In  March  2004,   the  FASB  issued  EITF  Issue  No.  03-1,   The  Meaning  of
Other-Than-Temporary Impairment and Its Application to Certain Investments. EITF
03-1 includes new guidance for  evaluating  and recording  impairment  losses on
debt  and  equity  investments,  as  well  as new  disclosure  requirements  for
investments that are deemed to be temporarily  impaired.  In September 2004, the
FASB issued Staff  Position EITF 03-1-1,  which delays the effective  date until
additional  guidance  is  issued  for the  application  of the  recognition  and
measurement  provisions  of EITF  03-1 to  investments  in  securities  that are
impaired;  however, the disclosure requirements are effective for annual periods
ending after June 15, 2004.  Although the Company will  continue to evaluate the
application of EITF 03-1,  management does not currently  believe  adoption will
have a  material  impact on the  Company's  financial  position  or  results  of
operations.

In November 2004, the FASB issued SFAS No. 151, Inventory Costs, an amendment of
ARB No. 43, Chapter 4. This statement amends the guidance in ARB No. 43, Chapter
4, Inventory  Pricing,  to clarify the  accounting for abnormal  amounts of idle
facility  expense,  freight,  handling costs,  and wasted  material  (spoilage).
Paragraph 5 of ARB No. 43,  Chapter 4,  previously  stated that  "...under  some
circumstances,  items such as idle facility expense,  excessive spoilage, double
freight,  and  rehandling  costs may be so abnormal as to require  treatment  as
current period  charges..." SFAS No. 151 requires that those items be recognized
as current-period  charges  regardless of whether they meet the criterion of "so
abnormal."  In  addition,  this  statement  requires  that  allocation  of fixed
production  overhead to the costs of conversion be based on the normal  capacity
of the production facilities.

The provisions of SFAS 151 shall be applied  prospectively and are effective for
inventory costs incurred during fiscal years beginning after June 15, 2005, with
earlier  application  permitted for inventory costs incurred during fiscal years
beginning  after the date this Statement was issued.  The Company's  adoption of
SFAS  No.  151 is not  currently  expected  to  have a  material  impact  on the
Company's financial position or results of operations.

In December 2004, the FASB issued SFAS No. 123(R) (revised  2004),  "Share-Based
Payment",  which amends FASB  Statement No. 123 and will be effective for public
companies for interim or annual periods beginning after June 15, 2005.

The revised standard  requires,  among other things that  compensation  cost for
employee  stock  options be measured at fair value on the grant date and charged
to expense over the employee's  requisite service period for the option.  Due to
the absence of observable market prices for employee stock options, the standard
indicates that the fair value of most stock options will be determined  using an
option-pricing model.

The Company's  adoption of SFAS No.  123(R) is not currently  expected to have a
material impact on the Company's financial position or results of operations.

In December 2004, the FASB issued SFAS No. 153, Exchanges of Nonmonetary assets,
an  amendment  of APB  Opinion  No.  29. The  guidance  in APB  Opinion  No. 29,
Accounting  for  Nonmonetary  Transactions,  is  based  on  the  principle  that
exchanges of  nonmonetary  assets should be measured  based on the fair value of
assets  exchanged.The  guidance  in  that  Opinion,  however,  included  certain
exceptions to that principle.  This Statement amends Opinion 29 to eliminate the



                                       31
<PAGE>

exception for  nonmonetary  exchanges of similar  productive  assets that do not
have commercial  substance.  A nonmonetary  exchange has commercial substance if
the future cash flows of the entity are  expected to change  significantly  as a
result of the  exchange.  SFAS No. 153 is effective  for  nonmonetary  exchanges
occurring  in fiscal  periods  beginning  after  June 15,  2005.  The  Company's
adoption  of SFAS No.  153 is not  expected  to have a  material  impact  on the
Company's financial position or results of operations.

Cash and concentration of risk
------------------------------

Cash includes cash on hand and demand deposits in accounts maintained with state
owned banks  within the  People's  Republic  of China and Hong Kong.  Total cash
(including  restricted  cash  balances)  in these banks at December 31, 2004 and
2003 amounted to $9,256,618 and  $4,192,740,  respectively  of which no deposits
are covered by  insurance.  The Company has not  experienced  any losses in such
accounts  and  believes  it is not  exposed  to any  risks  on its  cash in bank
accounts.

Restricted Cash
---------------

The Company  through its bank  agreements is required to keep certain amounts on
deposit  that are  subject to  withdrawal  restrictions  and these  amounts  are
$3,597,480 and $2,096,370 as of December 31, 2004 and 2003, respectively.

Inventories
-----------

Inventories  are  stated  at the  lower of cost or  market  using  the  first-in
first-out basis and consist of the following at December 31:

                                                           2004          2003
                                                       -----------   -----------
Raw materials                                          $ 9,123,814   $ 2,469,620
Finished goods                                           3,702,747     2,332,295
                                                       -----------   -----------
                                                       $12,826,561   $ 4,801,915
                                                       ===========   ===========

Inventories  consist of raw materials and finished goods. Raw materials  consist
primarily  of iron and steel  used in  production.  The cost of  finished  goods
included  direct  costs  of raw  materials  as  well  as  direct  labor  used in
production.  Indirect  production  costs such as utilities  and  indirect  labor
related to  production  such as assembly and  delivery are also  included in the
cost of inventory. No work in process inventory existed at December 31, 2004 and
2003 as all inventory in process was completed and transferred to finished goods
prior to the physical inventory count.

The Company  reviews its inventory  annually for possible  obsolete  goods or to
determine  if any reserves  are  necessary  for  potential  obsolescence.  As of
December  31, 2004 and 2003,  the Company has  determined  that no reserves  are
necessary at year end.



                                       32
<PAGE>

Financial instruments
---------------------

Statement of Financial  Accounting  Standards  No. 107 (SFAS 107),  "Disclosures
about Fair Value of Financial Instruments" requires disclosure of the fair value
of financial instruments held by the Company.

SFAS 107 defines the fair value of financial  instruments as the amount at which
the  instrument  could be exchanged  in a current  transaction  between  willing
parties. The Company considers the carrying amount of cash, accounts receivable,
other receivables,  accounts payable,  accrued liabilities and other payables to
approximate  their fair values  because of the short  period of time between the
origination of such instruments and their expected realization and their current
market rate of interest.

Accounts receivable, trade
--------------------------

The Company's  business  operations  are  conducted in the People's  Republic of
China.  During the normal  course of  business,  the Company  extends  unsecured
credit to its customers. Management reviews its accounts receivable on a regular
basis to  determine  if the bad debt  allowance  is adequate  at each  year-end.
However,  the Company  records a provision for accounts  receivable  trade which
ranges  from 0.3% to 1.0% of the  outstanding  accounts  receivable  balance  in
accordance  with  generally  accepted  accounting  principles  in the  PRC.  The
allowance  for doubtful  accounts as of December  31, 2004 and 2003  amounted to
$1,371 for each period.

Other receivables
-----------------

Other  receivables  consist of various cash advances to the Company's  unrelated
companies and individuals  which have business  relationships  with the Company.
These amounts are unsecured,  non-interest  bearing and generally are short term
in nature.

Intangible assets
-----------------

All land in the People's Republic of China is owned by the government and cannot
be sold to any individual or company.  However, the government grants the user a
"land use right" (the Right) to use the land.  The Company has acquired land use
rights  during  the  years  ending  in  2000  and  2003  for a total  amount  of
$2,870,902. The Company has the right to use this land for 50 years. At December
31, 2004 and 2003,  accumulated  amortization amounted to $593,623 and $306,533.
The cost of the rights is being amortized over ten years using the straight-line
method.

Intangible  assets of the Company  are  reviewed  annually  as to whether  their
carrying value has become impaired.  The Company considers assets to be impaired
if the  carrying  value  exceeds the future  projected  cash flows from  related
operations.  The  Company  also  re-evaluates  the  periods of  amortization  to
determine whether subsequent events and circumstances  warrant revised estimates
of useful lives. As of December 31, 2004, the Company expects these assets to be
fully recoverable.

Total  amortization  expense  for the years  ended  December  31,  2004 and 2003
amounted to $287,090 and $96,800 respectively.



                                       33
<PAGE>

Income taxes
------------

The Company has adopted  Statement of Financial  Accounting  Standards  No. 109,
"Accounting  for Income Taxes" (SFAS 109).  SFAS 109 requires the recognition of
deferred  income  tax  liabilities  and  assets  for  the  expected  future  tax
consequences  of temporary  differences  between  income tax basis and financial
reporting basis of assets and liabilities. Provision for income taxes consist of
taxes  currently due plus deferred  taxes.  There are no deferred tax amounts at
December 31, 2004 and 2003.

The charge for  taxation is based on the  results  for the year as adjusted  for
items, which are non-assessable or disallowed.  It is calculated using tax rates
that have been enacted or substantively enacted by the balance sheet date.

Deferred  tax is  accounted  for using the  balance  sheet  liability  method in
respect of temporary  differences  arising from differences between the carrying
amount  of  assets  and   liabilities  in  the  financial   statements  and  the
corresponding tax basis used in the computation of assessable tax profit.

In principle,  deferred tax liabilities are recognized for all taxable temporary
differences,  and  deferred tax assets are  recognized  to the extent that it is
probably  that  taxable  profit  will  be  available  against  which  deductible
temporary differences can be utilized.

Deferred  tax is  calculated  at the tax rates that are expected to apply to the
period when the asset is realized or the  liability is settled.  Deferred tax is
charged or  credited  in the income  statement,  except when it related to items
credited or charged  directly to equity,  in which case the deferred tax is also
dealt with in equity.

Deferred tax assets and  liabilities are offset when they relate to income taxes
levied by the same  taxation  authority  and the  Company  intends to settle its
current tax assets and liabilities on a net basis.

Under the Income Tax Laws, the Company is generally  subject to an income tax at
an effective  rate of 33% (30% state income taxes plus 3% local income taxes) on
incomes reported in the statutory  financial  statements  after  appropriate tax
adjustments,  unless the enterprise is located in a specially  designated region
for which more favorable effective tax rates are applicable.

The provision for income taxes at December 31 consisted of the following:

                                                               2004       2003
                                                             --------   --------
Provision for China Income Tax                               $823,888   $661,914
Provision for China Local Tax                                  82,389    105,517
                                                             --------   --------
      Total provision for income taxes                       $906,277   $767,431
                                                             ========   ========




                                       34
<PAGE>

The  following  table  reconciles  the U.S.  statutory  rates  to the  Company's
effective tax rate:

                                                           2004          2003
                                                        ---------     ---------
U.S. Statutory rates                                         34.0%         34.0%
Foreign income not recoginized in USA                       (34.0)        (34.0)
China income taxes                                           33.0          33.0
                                                        ---------     ---------
      Total provision for income taxes                       33.0%         33.0%
                                                        =========     =========

The  Company's  subsidiary,  Daqiuzhuang  Metal Sheet Co.,  Ltd became a Chinese
Sino-foreign equity joint venture at the time of the merger on October 14, 2004.
Daqiuzhuang Metal Sheet Co., Ltd should be now taxed under the Income Tax Law of
the People's Republic of China (PRC) concerning Foreign  Investment  Enterprises
and Foreign Enterprises and various local income tax laws (the Income Tax Laws).

The  Income  Tax  Law for  Enterprises  with  Foreign  Investments  and  Foreign
Enterprises  states.  "Any enterprise  with foreign  investments of a production
nature scheduled to operate for a period of not less than ten years shall,  upon
examination  and  verification  by the tax  authorities  in the year the company
begins to make a profit,  will be exempted  from  income  taxes in the first and
second years and allowed a fifty percent  reduction in the standard tax rates in
the  third to fifth  years."  Accordingly,  the  Company  is in the  process  of
applying for this tax benefit from local Chinese tax authority.

Value Added Tax
---------------

Enterprises  or  individuals  who  sell   commodities,   engage  in  repair  and
maintenance  or import and export  goods in the PRC are subject to a value added
tax in accordance with Chinese laws. The value added tax standard rate is 17% of
the gross sales price.  A credit is available  whereby VAT paid on the purchases
of  semi-finished  products  or raw  materials  used  in the  production  of the
Company's  finished  products  can be used to offset the VAT due on sales of the
finished product.

Earnings Per Share
------------------

The Company reports earnings per share in accordance with the provisions of SFAS
No. 128,  "Earnings Per Share." SFAS No. 128 requires  presentation of basic and
diluted earnings per share in conjunction with the disclosure of the methodology
used in computing  such earnings per share.  Basic  earnings per share  excludes
dilution and is computed by dividing income available to common  stockholders by
the  weighted  average  common  shares  outstanding  during the period.  Diluted
earnings  per takes into  account  the  potential  dilution  that could occur if
securities or other contracts to issue common stock were exercised and converted
into common stock.

The weighted  average  number of shares used to calculate EPS for the year ended
December  31, 2004  (13,594,890)  and 2003  (9,175,000)  reflect only the shares
outstanding  for those periods.



                                       35
<PAGE>

Note 3 - Supplemental disclosure of cash flow information

Income taxes paid amounted to $489,800 and $428,117 for the years ended December
31,  2004 and 2003,  respectively.  Interest  paid  amounted to  $1,463,385  and
$748,829 for the years ended December 31, 2004 and 2003, respectively.

During 2004, the Company issued 35,000 shares at a registration  price of $0.005
per share to a consultant as consideration for services performed having a value
of $175.

Note 4 - Notes receivable

This amount  represents  trade accounts  receivable  due from various  customers
where the customers'  bank has guaranteed  the payment of the  receivable.  This
amount is non-interest  bearing and is normally paid within three to six months.
The  Company  has the  ability  to  submit  their  request  for  payment  to the
customer's bank earlier than the scheduled  payment date;  however,  the Company
will incur an interest charge and processing fee in such instances.  The Company
had  $374,955  and  $1,188,854  outstanding  as of  December  31, 2004 and 2003,
respectively.

Note 5 - Other payable - related party

At December  31,  2004,  the  Company has a short term loan from Golden  Glister
Holdings Limited of $990,000. Golden Glister Holdings Limited is incorporated in
the territory of the British  Virgin Islands which our president Yu Zuo Sheng is
the majority  shareholder.  This amount was loaned to General  Steel  Investment
Co., Ltd for business operations.  This amount is short-term and is non interest
bearing.

Note 6 - Advances on inventory purchases

Advances on inventory purchases including the related party purchases are monies
deposited or advanced to outside vendors or related parties on future  inventory
purchases.  Due to the high  shortage of steel in China,  most of the  Company's
vendors  require  a  certain  amount  of money to be  deposited  with  them as a
guarantee that the Company will receive their purchases on a timely basis.

This amount is refundable and bears no interest. The Company has a legal binding
contract with their vendors for the guarantee deposit. The inventory is normally
delivered within one month after the monies has been advanced. The total amount
outstanding at December 31 consisted of the following:

                                                           2004          2003
                                                       -----------   -----------
Advances on inventory purchases - related parties      $      --     $ 1,021,824
                                                       ===========   ===========

Advances on inventory purchases                        $13,469,984   $ 7,831,480
                                                       ===========   ===========



                                       36
<PAGE>
<TABLE>
<CAPTION>

Note 7 - Short term loans - bank

Short term loans - bank represent  amounts due to various banks which are due on
demand or normally  within one year.  These loans can be renewed with the banks.
At December 31, the short term loans consisted of the following:

                                                                        2004          2003
                                                                    -----------   -----------
<S>                                                                 <C>           <C>
Loans from China Bank, JingHai Branch, due August,  2005 and
   August, 2004, respectively. Monthly interest only payment at
   6.372% per annum and 6.372% per annum, respectively, secured
   by equipment and property                                        $ 1,185,800   $ 1,185,800

Loans from Agriculture Bank,  DaQiuZhuang  Branch, due various
   dates from February,  2005 to October, 2005 and March, 2004 to
   November, 2004, respectively. Monthly interest only payments
   in 2005 ranging from from 6.5% to 6.9% per annum and in 2004
   6.6% to 6.7% per annum, respectively, guaranteed  by  an
   unrelated third party and secured by property and equipment       10,648,000     8,228,000

Loan from Construction Bank of China, JinHai Branch, due
   August 22, 2005 and August 20, 2004, respectively. Monthly
   interest only payment at 6.225% per annum and 5.433% per
   annum, respectively, secured by properties                         1,089,000     1,185,800

Loans from ShangHai PuFa Bank,  due various dates from March,
   2005 to November, 2005, Monthly interest only payments in 2005
   ranging from 5.8% to 6.4% per annum, guaranteed by an
   unrelated third party                                              6,050,000     2,420,000

Loans from China Merchant Bank, due various dates from June,
   2005 to August, 2005, Quarterly interest only payments, annual
   interest rate of 5.0445%, guaranteed by an unrelated third
   party                                                              6,050,000          --

Loan from  Construction Bank of China, due August 22, 2005 and
   November 11, 2004, respectively. Monthly interest only payment
   at 8.1576% per annum and 6.372%  per annum, respectively,
   guaranteed by an unrelated third party                               726,000       786,500
                                                                    -----------   -----------
                    Totals                                          $25,748,800   $13,806,100
                                                                    ===========   ===========
</TABLE>


                                       37
<PAGE>
<TABLE>
<CAPTION>

Note 8 - Short term notes payable

The Company has the following short term notes payable outstanding at December
31:

                                                              2004         2003
                                                           ----------   ----------
<S>                                                        <C>          <C>
China  Bank, Jing Hai Branch, various amounts due
   dates ranging between February and June 2004,
   restricted cash required ranging from 40% or 50% of
   loan amount, secured by land and buildings              $     --     $2,662,000

Farmer's Bank, various amounts due dates ranging
   between January and July 2004, restricted cash
   required of 50% of loan amount, guaranteed by the
   Company                                                  1,603,250         --


Daqiuzhuang Industrial and Commercial Bank,  various
   amounts due dates ranging between April and June
   2004, restricted cash required of 30% of loan amount,
   guaranteed by the Company                                     --        629,200

ShangHai PuFa Bank, due February 2004, restricted
   cash required of 30% of loan balance, guaranteed by
   the Company                                              1,815,000         --

China Bank, Jing Hai Branch, various amounts due
   dates ranging between  February and April 2005,
   restricted cash required  ranging from 40% or 50% of
   loan amount, secured by land and buildings               1,694,000         --

Farmer's  Bank, various  amounts due dates ranging
   between January and May 2005,  restricted cash
   required of 50% of loan amount, guaranteed by the
   Company                                                  2,057,000         --

Daqiuzhuang  Industrial and Commercial Bank, various
   amounts due dates ranging between May and June 2004,
   restricted cash required of 30% of loan amount,
   guaranteed by the Company                                  605,000         --

ShangHai PuFa Bank, due May 2005, restricted cash
   required of 30% of loan balance, guaranteed by the
   Company                                                  2,420,000         --
                                                           ----------   ----------
          Totals                                           $6,776,000   $6,709,450
                                                           ==========   ==========
</TABLE>


Total  interest  expense for the years ending  December 31, 2004 and 2003 on all
debt amounted to $1,463,385 and $632,957, respectively.


Note 9 - Statutory reserves

The laws and regulations of the People's Republic of China require that before a
Sino-foreign  cooperative joint venture  enterprise  distributes  profits to its
partners,  it must first  satisfy  all tax  liabilities,  provide  for losses in
previous years and make allocations, in proportions determined at the discretion
of the board of directors, after the statutory reserve.

Pursuant to the Board of Directors'  resolution,  the Company transferred 10% of
its net income,  as determined in accordance  with the PRC accounting  rules and
regulations,  to the statutory  surplus  reserve fund until such reserve balance
reaches 50% of the Company's registered capital.



                                       38
<PAGE>

The transfer to this reserve must be made before  distributions of any dividends
to partners.  The Company was not considered to be a joint venture company until
June 30, 2004; therefore,  the Company made no allocation to the reserve for the
year ended December 31, 2003. For the year ending December 31, 2004, the Company
transferred  $154,794 to the surplus  reserve fund which  represents  10% of the
current year's net income determined in accordance with PRC accounting rules and
regulations.

The surplus reserve fund is non-distributable  other than during liquidation and
can be used to fund  previous  years'  losses,  if any,  and may be utilized for
business  expansion  or  converted  into share  capital by issuing new shares to
existing  shareholders in proportion to their  shareholding or by increasing the
par value of the shares  currently  held by them,  provided  that the  remaining
reserve balance after such issue is not less than 25% of the registered capital.
The Chinese  government  restricts  distributions of registered  capital and the
additional  investment amounts required by the Chinese joint ventures.  Approval
by the Chinese government must be obtained before distributions of these amounts
can be returned to the shareholders.


Note 10 - Customer deposits

Customer deposits represent amounts advanced by customers on product orders. The
product  normally  is shipped  within six months  after  receipt of the  advance
payment and the related sale is  recognized  in  accordance  with the  Company's
revenue  recognition policy. As of December 31, 2004 and 2003, customer deposits
amounted to $2,009,313 and $914,160, respectively.


Note 11 - Deposits due to sales representatives

The Company has entered  into  agreements  with  various  entities to act as the
Company's  exclusive  sales agent in a specified  area.  These  exclusive  sales
agents must meet certain  criteria and are required to deposit a certain  amount
of money with the Company.  In return the sales agents receive  exclusive  sales
rights to a specified area and discounted  prices on products they order.  These
deposits  bear no  interest  and are  required to be returned to the sales agent
once the agreement has been terminated.  The Company had $1,231,780 and $862,730
in deposits due to sales  representatives  outstanding  at December 31, 2004 and
2003, respectively.


Note 12 - Major customers

The Company has four major customers which represents  approximately  40% of the
Company's  total  sales for the year  ended  December  31,  2004.  One  customer
represents approximately 20% of the total sales for the year.



                                       39
<PAGE>

Note 13 - Major Suppliers

The Company purchases  approximately 80% of their raw materials from three major
suppliers;  each of these suppliers individually represents more than 18% of the
total purchases of the Company.


Note 14 - Minority Interest

Minority interest  represents the outside  shareholders' 30% interest in Tianjin
Daqiuzhuang Metal Sheet Co., Ltd.


Note 15 - Other income (expense)

Other  income  and  expense  for the years  ended  December  31  consist  of the
following:

                                                         2004           2003
                                                     -----------    -----------
Finance/interest expense                             $(1,572,189)   $  (638,493)
Other nonoperating income                                137,169           --
Other nonoperating expense                              (181,357)        (5,314)
                                                     -----------    -----------
Total other income (expense)                         $(1,616,377)   $  (643,807)
                                                     ===========    ===========

Note 17 - Reclassifications

Certain  amounts  for the year  ending  December  31,  2003 in the  accompanying
financial   statements   have  been   reclassified  to  conform  with  the  2004
presentation.  These  reclassifications  have no  effect  on net  income or cash
flows.


Item 8. Changes and  disagreements  with Accountants on Accounting and Financial
Disclosure.

         Not applicable.

Item 8A.  Controls and procedures.

         As required by Rule 13a-15 under the Exchange  Act,  within the 90 days
prior to the filing date of this  report,  we carried out an  evaluation  of the
effectiveness  of the  design  and  operation  of our  disclosure  controls  and
procedures.  This  evaluation was carried out under the supervision and with the
participation  of our  management.  The Company is in the  process of  reviewing
their internal  control systems in order to be compliant with Section 404 of the
Sarbanes  Oxley Act.  The  Company  anticipates  that the review and any changes
required to implement to be in compliance  with Section 404 will be completed by
the required time. However at this time the Company makes no representation that
the  Company's  systems of  internal  control  comply  with  Section  404 of the
Sarbanes Oxley Act.



                                       40
<PAGE>

         Disclosure  controls and procedures  are controls and other  procedures
that are  designed to ensure that  information  required to be  disclosed in our
reports  filed or  submitted  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.  Disclosure  controls  and  procedures
include,  without  limitation,  controls and procedures  designed to ensure that
information required to be disclosed in our reports filed under the Exchange Act
is  accumulated  and  communicated  to  management,  to allow  timely  decisions
regarding required disclosure.

Item 8B.  Other information
           Not applicable.

                                                              Part III

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

         The  following  table  sets forth  certain  information  regarding  the
Company's executive officers:
------------------ ----- ------------------------------------------ ------------
                                                                     Date of
Name                Age  Position                                    appointment
------------------ ----- ------------------------------------------ ------------
Yu, Zuo Sheng       40   Director / President and Chief Executive   10/14/04
                         Officer
                         Chairman of Board of Directors
------------------ ----- ------------------------------------------ ------------
Li, Huan Cheng      55   Director                                   3/7/05
------------------ ----- ------------------------------------------ ------------
Chen, John          33   Director / Chief financial Officer         3/7/05
------------------ ----- ------------------------------------------ ------------
Wang, Guo Dong      64   Director / Chief Technical Officer         3/7/05
------------------ ----- ------------------------------------------ ------------
Zhao, Sheng Guo     45   Director / Chief Engineer                  3/7/05
------------------ ----- ------------------------------------------ ------------
Wang, Zhi Guang     47   General Manager                            10/14/04
------------------ ----- ------------------------------------------ ------------
Han, Wen Chun       40   Plant Controller                           10/14/04
------------------ ----- ------------------------------------------ ------------
Liu, Yu Wen         32   Manager of Human Resource Department       10/14/04
------------------ ----- ------------------------------------------ ------------
Yu, Zuo Yan         38   Manager of Equipment Department            10/14/04
------------------ ----- ------------------------------------------ ------------
Yuan, Sen Tong      34   Manager of Sales Department                10/14/04
------------------ ----- ------------------------------------------ ------------
Zhang Zu Yong       39   Manager of Purchasing Department           10/14/04
------------------ ----- ------------------------------------------ ------------
Hou, Qi             34   Manager of Production Department           10/14/04
------------------ ----- ------------------------------------------ ------------

         Our directors are  generally  elected until the next annual  meeting of
shareholders  and until their  successors  are elected and  qualified,  or until
their earlier  resignation  or removal.  Each  director's  term of office is one
year.

         None  of the  following  ever  occurred  to any  of our  directors  and
officers.

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



                                       41
<PAGE>

         (2) Any  conviction  in a  criminal  proceeding  or being  subject to a
pending  criminal  proceeding  (excluding  traffic  violations  and other  minor
offenses);

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

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

         Family relationships

         Mr. Liu, Yu Wen is Mr. Yu, Zuo Sheng's brother in-law,  Mr. Yu, Zuo Yan
is Mr. Yu, Zuo Sheng's brother.

         Mr. Yu, Zuo Sheng, President and Chief Executive Officer,  joined us in
August  2000 and became a Director in August  2000.  From April 1986 to February
1992, he was President of Daqiuzhuang Metal sheets Factory, Tianjin, China. From
February 1992 to December  1999,  he was General  Manager of Sheng Da Industrial
Company,  Tianjin China.  From November 1999 to March 2001, he was President and
Chairman  of Board of  Directors  of Sheng Da  Machinery  Manufactory,  Tianjin,
China.  Since  February 2001, he is President and Chairman of Board of Directors
of Beijing Wendlar  Investment  Management Group,  Beijing,  China.  Since March
2001,  he is  President  and  Chairman of Board of  Directors of Baotou Sheng Da
Steel Pipe Limited, Inner Mongolia,  China and Chairman of Board of Directors of
Sheng Da Steel and Iron mill, Hebei province,  China. Since April 2001, he is he
is President  and Chairman of Sheng Da Industrial  Park Real Estate  Development
Limited.  Since  December 2001, Mr. Yu is President and Chairman of Beijing Shou
Lun Real Estate Development Company, Beijing, China.

         Mr. Yu  graduated  in 1985  graduated  from  Sciences  and  Engineering
Institute,  Tianjin,  China.  In July 1994,  he  received  Bachelor  degree from
Institute  of Business  Management  for  Officers.  Mr. Yu received the title of
"Senior  Economist" from the Committee of Science and Technology of Tianjin City
in 1994.  In July 1997,  he  received a MBA degree from the  Graduate  School of
Tianjin Party University.  In April 2003, Mr. Yu, Zuo Sheng held a position as a
member of China's APEC (Asia Pacific Economic Co-operation) Development Council.

         Ms. Li, Huan Cheng,  director  since May 2002.  From  December  1968 to
November 1994, she was manager of Tianjin Trust Company,  Tianjin,  China.  From
January 1995 to May 2002,  she was manager and CPA of Tianjin Gao Xin  Valuation
and  Liquidation  Company;  Tianjin,  China.  In July 1982,  she graduated  from
Tianjin Financial and Economic Institute, Tianjin, China.

         Mr. John Chen joined us in July 2003. He is the Chief Financial Officer
and a Director. From August 1997 to July 2003, he was senior accountant at Moore
Stephens  Wurth  Frazer and  Torbet,  LLP,  Los  Angeles,  California,  USA.  He
graduated from Norman Bethune  University of Medical  Science,  Changchun  city,
Jilin  province,  China in September 1992. He received B.S. degree in accounting
from California State Polytechnic University,  Pomona,  California,  USA in July
1997.



                                       42
<PAGE>

         Mr.  Wang,  Guo Dong joined us in May 2003.  He is the Chief  Technical
Officer and a Director.  From  January  1982 to May 2003,  he was  professor  at
Northeast University, Shenyang City, Liaoning province, China. From October 1968
to October 1978, he was the engineer of Anshan Iron and Steel Company, in Anshan
City,  Liaoning  province,  China.  He received a Master's Degree in Engineering
from Beijing Iron and Steel Research  Institute,  Beijing,  China,  in September
1982.  He also  received  a  Bachelor's  Degree in  Engineering  from  Northeast
University, Shenyang, China in September 1966.

         Mr. Zhao,  Sheng Guo joined us in March 2003. He is the Chief  Engineer
and a Director.  From June 1995 to June 2003, he was the CTO of Beijing  Capital
Steel Plate Mill. From March 1988 to June 1995, he was chief engineer of Beijing
Capital  Steel Plate Mill.  From March 1983 to March  1988,  he was  engineer of
Beijing  Special Steel Metal sheet Mill.  He received MBA Degree from  Northeast
University,  Shenyang  city,  Liaoning  province,  China,  in  August  2001.  He
graduated from Beijing Steel Institute in Beijing, China in 1982.

         Mr.  Wang Zhi  Guang  joined us in  February  2000.  He is the  General
Manager of Daqiuzhuang Metal Sheet Co., Ltd. From January 1994 to February 2000,
he was the  Executive  Vice  President of Inner  Mongolia  Trust and  Investment
Company in Inner Mongolia. He received Bachelor Degree of Engineering in Taiyuan
Heavy Machinery Institute in Taiyuan city, Shanxi province, in September 1976.

         Mr.  Han,  Wen  Chun  joined  us  in  October  2000.  He is  the  plant
controller.  From June 1989 to October  2000,  he was the manager of  Accounting
Department of Sheng Da Industrial Company.

         Mr. Liu, Yu Wen joined us in August  2000.  He is the head of the Human
Resources Department. From October 1991 to August 2000, he was office manager of
Daqiuzhuang Metal Sheet Company, Daqiuzhuang, Tianjin, China. Since August 2000,
he is office manager of Daqiuzhang Metal Sheet Company Limited. In July 1991, he
graduated from Jinghai Adult High School,  Tianjin,  China. He is brother in-law
of Mr. Yu, Zuo Sheng.

         Mr.  Yu,  Zuo Yan  joined us in May,  2000.  He is the  manager  of the
equipment  department.  From July 1989 to May 2000, he was manager of steel pipe
workshop of Daqiuzhuang Steel Pipe Company. From August 1986 to May 1989, he was
the  technician of  Daqiuzhuang  Steel Pipe Company.  He graduated  from Tianjin
Polytechnic Institute in August 1986. He is brother of Mr. Yu, Zuo Sheng.

         Mr. Yuan,  Sen Tong joined us in August 2000.  He is the manager of our
Sales  Department.  From February 1995 to August 2000, he was general manager of
Metal Material Trading Company of Wan Quan Group.



                                       43
<PAGE>

         Mr. Zhang,  Zu Yong joined us in 1995. He is the head of the Purchasing
Department. From March 1990 to July 1995, he was the head of sales department of
Jin Mei Group in Tianjin, China.

         Mr.  Hou,  Qi joined us in  February  2001.  He is the  manager  of the
Production Department since October 2001. From February 2001 to October 2001, he
was the assistant  production  manager of Daqiuzhuang Metal Sheet Co., Ltd. From
September 1992 to February 1998, he was assistant  production  manager of Baotou
Agricultural Vehicles Manufactory. In September 1992, he received BS degree from
Agriculture University of Inner Mongolia, China.

      Officers are appointed annually by the Board of Directors.

         Section 16(a) Beneficial Ownership Reporting Compliance

         Section  16(a) of the Exchange Act  requires our  directors,  executive
officers  and  persons  who own more than 10% of a required  class of our equity
securities,  to file with the SEC initial  reports of  ownership  and reports of
changes in ownership of common stock and other equity securities of our company.
Officers,  directors  and  greater  than 10%  shareholders  are  required by SEC
regulation to furnish us with copies of all Section 16(a) forms they file.

         To our  knowledge,  based upon a review of the  copies of such  reports
furnished to us and based upon  written  representations  that no other  reports
were  required,  all  Section  16(a)  filing  requirements   applicable  to  our
officers',  directors and greater than 10% beneficial  owners were complied with
during the fiscal year ended December 31, 2004.

Code of Ethics

         Our board of directors  adopted a code of ethics that applies to all of
our officers and employees, including our principal executive officer, principal
financial  officer,  principal  accounting  officer and controller.  The code of
ethics will establish standards and guidelines to assist our directors, officers
and employees in complying with both our corporate policies and with the law. It
has been posted on our website: http://www.generalsteelinc.com.

Item 10.  Executive compensation

         The  following  table sets forth  certain  information  concerning  the
compensation  paid to our chief executive  officer and our two other most highly
compensated executive officers:



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<PAGE>

---------------------------------------- ---------------------------------------
Name and position                        Annual Compensation
---------------------------------------- ---------------------------------------
Yu, Zuo Sheng                            RMB 1,200,000
Chief Executive officer                  (approximately USD 144,578)
---------------------------------------- ---------------------------------------

John Chen                                RMB 120,000
Chief Financial Officer                  (approximately USD 14,458)
---------------------------------------- ---------------------------------------

Wang Zhiguang                            RMB 60,000
General Manager                          (approximately USD 7,228)
---------------------------------------- ---------------------------------------


Item 11.  Security  ownership of certain  beneficial  owners and  management and
related stockholders matters.

         The following table sets forth certain information regarding beneficial
ownership of common stock as of December 31, 2005, by:

         Each  person  known to us to own  beneficially  more  than  5%,  in the
aggregate, of the outstanding shares of our common stock;

         o        Each director;

         o        Each of our  chief  executive  officer  and our other two most
                  highly compensated executive officers; and

         o        All executive officers and directors as a group.

         The  number of shares  beneficially  owned  and the  percent  of shares
outstanding are based on 31,250,000 shares  outstanding as of December 31, 2004.
Beneficial  ownership is determined in accordance  with the rules of the SEC and
generally includes voting or investment power with respect to securities.

Name                    Position Held           Shares Owned        Percentage

Yu, Zuo Sheng           Presicent and CEO       23,929,500          76.5%


Exhibit 12.  Certain Relationships and Related Transactions.

Other payable

         The  Company  has short term loan to Golden  Glister  Holdings  Limited
$990,000  which  has  been  recorded  as  other  payable-related  party  on  the
accompanying   financial   statements.   Golden  Glister   Holdings  Limited  is
incorporated  in the territory of the British Virgin Islands which the President
Yu, Zuo Sheng is the  majority  shareholder.  This  amount was loaned to General
Steel Investment Co., Ltd for business operations. This amount is short-term and
no interest is being charged on this amount.



                                       45
<PAGE>

Item 13. Exhibits.

Exhibit No.       Description
-----------       -----------

31.1              Certification of the Principal  Executive  Officer pursuant to
                  Section 302 of the Sarbanes-Oxley Act of 2002.

31.2              Certification   of  the  Principal  Chief  Financial   Officer
                  pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1              Certification  of  Principal  Executive  Officer  pursuant  to
                  Section 906 of the Sarbanes-Oxley Act of 2002.

32.2              Certification of Principal Chief Financial Officer pursuant to
                  Section 906 of the Sarbanes-Oxley Act of 2002.

Item 14.  Principal accounting fees and services

(a) Audit Fees

         Our principal  accountant,  Moore Stephens  Wurth Frazer & Torbet,  LLP
("Moore  Stephens"),  billed us aggregate fees in the amount of  approximately $
210,000 for the fiscal  years ended  December  31, 2004 and  December  31, 2003.
These amounts were billed for professional services that Moore Stephens provided
for the  audit of our  annual  financial  statements,  review  of the  financial
statements  included  in our Form 8-K filed  earlier  this  year,  review of our
securities  offerings and other services  typically provided by an accountant in
connection with statutory and regulatory filings or engagements for those fiscal
years.

(b) Audit-Related Fees

         Moore Stephens billed us aggregate fees in the amount of  approximately
$ 0 for the fiscal years ended  December 31, 2004 and December 31, 2003, and for
assurance and related  services that were reasonably  related to the performance
of the audit or review of our financial statements.

(c) Tax Fees

         Moore Stephens billed us aggregate fees in the amount of  approximately
$ 0 for the fiscal years ended  December 31, 2004 and December 31, 2003, and for
tax compliance, tax advice, and tax planning.

(d) All Other Fees

         Moore Stephens billed us aggregate fees in the amount of  approximately
$ 0 for the fiscal years ended  December 31, 2004 and December 31, 2003, and for
all other fees.



                                       46
<PAGE>

(e) Audit Committee's Pre-Approval

         Section  10A(i) of the  Securities  Exchange Act prohibits our auditors
from performing  audit services for us as well as any services not considered to
be "audit services" unless such services are pre-approved by the audit committee
of the board of  directors,  or unless  the  services  meet  certain  de minimis
standards.  In the fiscal  years ended  December 31, 2004 and December 31, 2003,
Moore Stephens has not performed for us any services not considered to be "audit
services."

         The  percentage  of the fees for  audit,  audit-related,  tax and other
services were as set forth in the following table:

                  Percentage of total fees paid to Moore Stephens

--------------------------------------------------------------------------------
                         Fiscal Year December 2003     Fiscal Year December 2004
--------------------------------------------------------------------------------
Audit fees                         100%                          100%
Audit-related fees                   0%                            0%
Tax fees                             0%                            0%
All other fees                       0%                            0%

















                                       47
<PAGE>

Signatures

         In  accordance  with  Section  13 or 15(d)  of the  Exchange  Act,  the
registrant  caused  this  report to be signed on its behalf by the  undersigned,
thereunto duly authorized.


                                           General Steel Holdings, Inc.
                                           (Registrant)

Date: March 31, 2005                        /s/ Zuo Sheng Yu
                                           -------------------------------------
                                           Zuo Sheng Yu
                                           Chief Executive Officer and President



                                           General Steel Holdings, Inc.
                                           (Registrant)

Date: March 31, 2005                        /s/ John Chen
                                           -------------------------------------
                                           John Chen
                                           Director and Chief Financial Officer










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