SECURITIES EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                   FORM 10-QSB

(X)   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934

( )   TRANSACTION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934

For Quarter Ended:                        Commission File Number:
September 30, 2004                                                0-7722


                           NEW CENTURY COMPANIES, INC.
             ------------------------------------------------------
             (Exact name of Registrant as specified in its charter)


       DELAWARE                                             061034587
-------------------------------             ------------------------------------
(State or other jurisdiction of             (IRS Employer Identification Number)
Incorporation or organization)


                           9835 Santa Fe Springs Road
                           Santa Fe Springs, CA 90670
--------------------------------------------------------------------------------
(Address of Principal Executive Offices)                (Zip Code)


                                 (562) 906-8455
              ----------------------------------------------------
              (Registrant's telephone number, including area code)


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

The number of shares of Common Stock, par value $ .10 per share,  outstanding as
of November 18, 2004 was 7,042,265.

Transitional Small Business Disclosure Format (check one):   Yes ___   No _X_

<PAGE>

ITEM 1.  FINANCIAL STATEMENTS

         The condensed  consolidated  Financial  Statements are set forth at the
end of this document.

                                                                            Page
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

     Condensed Consolidated Balance Sheet

     Condensed Consolidated Statements of Operations

     Condensed Consolidated Statements of Cash Flows

     Notes to Condensed Consolidated Financial Statements


ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

ITEM 3.    CONTROLS AND PROCEDURES

PART II    OTHER INFORMATION

ITEM 1.    LEGAL PROCEEDING

ITEM 2.    UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

ITEM 3.    DEFAULTS UPON SENIOR SECURITIES

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

ITEM 5.    OTHER INFORMATION

ITEM 6.    EXHIBITS



                                       2
<PAGE>

ITEM 1.  FINANCIAL STATEMENTS

       The condensed  consolidated financial statements are set forth at the end
of this document.

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

      The following  discussion should be read in conjunction with the Company's
condensed  consolidated  financial  statements  and the notes thereto  appearing
elsewhere in this Form 10-QSB.  Certain statements contained herein that are not
related  to  historical  results,  including,  without  limitation,   statements
regarding the  Company's  business  strategy and  objectives,  future  financial
position,  expectations about pending litigation and estimated cost savings, are
forward-looking  statements  and involve risks and  uncertainties.  Although the
Company believes that the assumptions on which these forward-looking  statements
are based are reasonable,  there can be no assurance that such  assumptions will
prove to be accurate  and actual  results  could  differ  materially  from those
discussed  in the  forward-looking  statements.  Factors  that  could  cause  or
contribute  to such  differences  include,  but are not limited  to,  regulatory
policies,  competition  from other  similar  businesses,  and market and general
policies,  competition  from other  similar  businesses,  and market and general
economic factors.  All forward-looking  statements contained in this Form 10-QSB
are qualified in their entirety by this statement.

OVERVIEW

      On May 25, 2001,  the Company  entered into a plan of  Reorganization  and
Merger with New Century Remanufacturing,  Inc. ("NCR"). Immediately prior to the
merger, the Company had 50,000,000 shares authorized and 2,695,942 shares issued
and outstanding.  Pursuant to the merger, all of the 1,800 outstanding shares of
NCR were  exchanged  for shares of the  Company  on a 1 to 833.33  basis or into
1,500,000  shares of common stock of the Company for a total of 4,195,942 shares
of common stock issued and outstanding.  Immediately after the merger,  all then
existing  officers and directors of the Company  resigned and the  management of
NCR was elected and appointed to such positions;  thereby  effecting a change of
control.  Although NCR became a wholly owned subsidiary of the Company following
the transaction,  because the transaction  resulted in a change of control,  the
transaction was recorded as a "reverse  merger" whereby NCR was considered to be
the accounting acquirer of the Company.

      After the  reverse  merger the  Company  changed  its name to New  Century
Companies,  Inc. The results of the Company  previously  filed in the past years
are not included  herein.  The related  financial  statements are the results of
operations for NCR.

PLAN OF OPERATIONS

      The earnings of the Company for the three months ended  September 30, 2004
were negative as a result of  management's  strategy of continued  investment in
research and development of new projects and of the corporate  expenses  related
to compliance with the regulatory requirements of being a public company and the
inability to manufacture  and ship products as a result of the Company's lack of
working capital.  The goal of these expenditures in research and development was


                                        3
<PAGE>

to position the Company as a leading  manufacturer and  remanufacturer  of large
horizontal and vertical turning machines. The Company has completed the majority
of this current  development  effort and expects limited resources to be devoted
to this area in the next  fiscal  year.  The  Company's  current  strategy is to
expand its  customer  sales base with its present line of machine  products.  As
stated below,  the Company's  ability to continue  operations  and implement its
business plan depends on the raising of additional  capital. No assurance can be
given that funds will be available, or if available, the terms thereof.

RESULTS OF OPERATIONS

THREE-MONTH  PERIOD ENDED SEPTEMBER 30, 2004 COMPARED TO THE THREE-MONTH  PERIOD
ENDED SEPTEMBER 30, 2003

REVENUE AND GROSS PROFIT MARGIN

      The Company  generated  revenues of $1,166,947 for the three-month  period
ended  September  30,  2004,  which  was a  $942,017  or 44.67 %  decrease  from
$2,108,964 in the corresponding  period in 2003. The decrease is the result of a
deficiency in working capital which has limited our ability to fulfill  customer
orders.  Additionally,  the  overall  market  for  machine  tools  is  cyclical,
reflecting economic conditions,  production capacity utilization, changes in tax
and fiscal policies,  corporate profitability and financial condition as well as
the general level of business confidence. The Company anticipates an increase in
customer orders for next quarter, based on the growth of the overall market, but
there can be no assurance of such orders.

      There was a 160.15%  decrease in gross profit for the  three-month  period
ended  September  30,  2004,  due to lower  revenues.  Gross  profit  (loss) was
$(205,924), compared to a gross profit of $342,346 from the corresponding period
in 2003.  This decrease is a result of the weak economy in the United States and
competitive  market  conditions  that have dampened the demand for the Company's
products.

      Interest  expense for the  three-month  period  ended  September  30, 2004
decreased  to $46,099,  compared to $78,454 for the period ended  September  30,
2003.  For  the  three-month  period  ended  September  30,  2003,  the  Company
accumulated  extra  interest of  approximately  $32,355,  for the  recapture  of
interest  unaccrued for the previous periods,  on loans from three  individuals,
initiated on 12/24/01, 12/03/02 and 1/30/03.

OPERATING EXPENSES

      Operating expenses decreased by $118,931 or 32.70%,  from $363,750 for the
three-month  period ended  September 30, 2003 to $244,819 for the  corresponding
period in 2004. This decrease is a result of cutting off all the expenses,  such
as  consulting,  and  salaries  and  general  and  administrative,  based on the
continued struggle of the management to increase operational productivity.

NET INCOME/LOSS AND EARNING/LOSS PER SHARE


                                       4
<PAGE>

      Net loss was $492,030 for the three-month period ended September 30, 2004,
compared  to a loss of  $100,725  for the  corresponding  period  in  2003.  The
increase in net loss is  attributable  to cash flow problems  which affected the
Company's ability to complete timely the manufacture and shipment of machines.

      Loss per  share  for the  three-month  period  ended  September  30,  2004
increased to $(0.08) for the  three-month  period ended September 30, 2004, from
$(0.02) for the corresponding period in 2003.

NINE-MONTH PERIOD ENDED SEPTEMBER 30, 2004 COMPARED TO THE NINE-MONTH PERIOD
ENDED SEPTEMBER 30, 2003.

REVENUE AND GROSS PROFIT MARGIN

      For the nine-month  period ended  September 30, 2004,  total revenues were
$3,728,016,  which was a $2,036,920 or 35.33 % decrease  from  $5,764,936 in the
corresponding  period in 2003.  The  decrease  is the  result of a  decrease  in
customer's  orders and a  deficiency  in working  capital  that has  limited our
ability to fulfill customer orders.

      For the nine-month  period ended  September 30, 2004,  gross profit (loss)
was $(179,407) or (5)% of revenue,  compared to $214,746 or 4% of revenue in the
corresponding  period in 2003.  This decrease is a result of competitive  market
conditions that have caused the Company to sell products at lower costs.

      Interest  expense  decreased  from  $220,671  for the  nine  months  ended
September  30, 2003 to $132,901 for the  nine-month  period ended  September 30,
2004.  For  the  nine-month   period  ended  September  30,  2003,  the  Company
accumulated  extra  interest of  approximately  $32,355,  for the  recapture  of
interest  unaccrued for the previous periods,  on loans from three  individuals,
initiated on 12/24/01, 12/03/02 and 1/30/03.

OPERATING EXPENSES

      For the nine-month  period ended  September 30, 2004,  operating  expenses
decreased by $616,945 or 38.60% from  $1,598,389 for the nine month period ended
September  30, 2003,  to $981,444 for the nine month period ended  September 30,
2004.  This  decrease  is a result  of  cutting  off all the  expenses,  such as
consulting, and salaries and general and administrative,  based on the continued
struggle of the management to increase operational productivity.

NET LOSS AND LOSS PER SHARE

      For the nine-month  period ended  September 30, 2004, we had a net loss of
$743,882  compared to a net loss of $1,606,781 for the  corresponding  period in
2003. The decrease in net loss is primarily  attributable to a $87,770  decrease
in interest expenses, a loss of deposit of $465,428 in 2003, and a $549,870 gain
on  forgiveness  of accounts  payable from a  negotiation  between the Company's
management and its vendors.


                                       5
<PAGE>

      For the  nine-month  period  ended  September  30,  2004,  loss per  share
decreased by $0.16 from $(0.28) for the  nine-month  period ended  September 30,
2003 to $(0.12) for the corresponding period in 2003.

LIQUIDITY AND CAPITAL RESOURCES

      We have financed our working capital requirements through a combination of
internally generated cash and short-term loans.

      Cash was $3,212 as of September 30, 2004.
      At  September  30,  2004,  we had a  stockholder's  deficit of  $1,832,222
(excluding notes  receivable from  stockholders)  and an accumulated  deficit of
$6,696,703.  Our primary liquidity need is for working capital. To date, we have
financed our working  capital  requirements  through a combination of internally
generated cash and short-term  loans. We intend to continue  funding our current
operations through sales and debt and equity financing  arrangements that may be
insufficient  to fund our capital  expenditures,  working capital and other cash
requirements.  In order to continue operations, we must obtain financing. We are
currently addressing our liquidity issue by the following actions:

      o     Continue our aggressive program for selling inventory.

      o     Continue to implement plans to further reduce operating costs.

      o     Continue seeking investment capital through the public or private
            markets.

      o     Secure new customer orders. Since January 2004, we have secured
            $4,500,000 of new orders.

      There is no guarantee that any of these strategies will enable the Company
to meet its obligations for the foreseeable  future. If we are not successful in
implementing  these  strategies  and  if we  are  unable  to  obtain  additional
financing, we will be unable to continue our operations.

      We  intend  to  pursue  external   financing  sources  to  meet  the  cash
requirement  of ongoing  operations.  Management  is currently  seeking to raise
additional  funds in the form of an equity  or debt  securities  offering,  or a
combination  thereof.  However,  there can be no  guarantee  that we will  raise
sufficient  capital to execute  our  business  plan.  To the extent  that we are
unable to raise sufficient  capital,  our business plan will require substantial
modifications  and our  operations  may be  curtailed.  These  conditions  raise
substantial doubt about our ability to continue as a going concern. Continuation
as a going concern is dependent upon our ability to ultimately attain profitable
operations,  generate  sufficient  cash  flow to meet  obligations,  and  obtain
additional financing as may be required.

INFLATION AND CHANGING PRICES

         The Company  does not foresee any adverse  effects on its earnings as a
result of inflation or changing prices.


                                       6
<PAGE>

GOING CONCERN

         The Company has incurred  operating losses in the last two years, has a
working  capital  deficit  and  a  significant   stockholders'   deficit.  These
conditions raise  substantial doubt about the Company's ability to continue as a
going concern.

CRITICAL ACCOUNT POLICIES

         The  preparation  of financial  statements  and related  disclosures in
conformity with accounting principles generally accepted in the United States of
America  requires  management to make judgments,  assumptions and estimates that
affect the amounts reported in the condensed  consolidated  financial statements
and the accompanying  notes.  The amounts of assets and liabilities  reported on
the balance sheet and the amounts of revenues and expenses  reported for each of
the fiscal  periods are affected by estimates  and  assumptions,  which are used
for,  but not  limited to, the  accounting  for  revenue  recognition,  accounts
receivable,  doubtful accounts and inventories. Actual results could differ from
these estimates.  The following critical  accounting  policies are significantly
affected by judgments,  assumptions and estimates used in the preparation of the
financial statements:

         Concentration of Credit Risk

         The Company sells  products to customers  throughout the United States.
The  Company's   ability  to  collect   receivables   is  affected  by  economic
fluctuations in the geographic areas served by the Company. Although the Company
does not  obtain  collateral  with  which to secure  its  contracts  receivable,
management  periodically reviews contracts receivable and assesses the financial
strength of its customers  and, as a  consequence,  believes that the receivable
credit risk exposure is limited.

         Long-Lived Assets

         In July 2001, the Financial  Accounting Standards Board ("FASB") issued
Statements of Financial  Accounting  Standards ("SFAS") No. 144, "Accounting for
the  Impairment of Long-Lived  Assets and for  Long-Lived  Assets to be Disposed
Of." SFAS 144 addresses financial accounting and reporting for the impairment or
disposal of  long-lived  assets.  SFAS 144 requires  that  long-lived  assets be
reviewed for impairment  whenever  events or changes in  circumstances  indicate
that  their  carrying  amount  may not be  recoverable.  If the cost  basis of a
long-lived  asset is greater than the  projected  future  undiscounted  net cash
flows from such asset  (excluding  interest),  an impairment loss is recognized.
Impairment losses are calculated as the difference  between the cost basis of an
asset  and its  estimated  fair  value.  SFAS 144  also  requires  companies  to
separately  report  discounted  operations  and  extends  that  reporting  to  a
component of an entity that either has been  disposed of (by sales,  abandonment
or in a distribution to owners) or is classified as held for sale.  Assets to be
disposed of are reported at the lower of the carrying  amount or fair value less
costs to sell. The Company adopted SFAS 144 on January 1, 2002. The provision of
this statement for assets held for sale or other disposal generally are required
to  be  applied  prospectively  after  the  adoption  date  to  newly  initiated
commitments to plan to sell such assets, as defined, by management. As a result,
management cannot determine the potential effects that adoption of SFAS 144 will
have on the  Company's  financial  statements  with  respect to future  disposal
decision,  if any. To date,  management has determined  that no such  impairment
exists and therefore,  no adjustments  have been made to the carrying  values of
long-lived assets.  There can be no assurance,  however,  that market conditions
will not change or demand for the  Company's  products or services will continue
which could result in impairment of long-lived assets in the future.


                                       7
<PAGE>

         Revenue Recognition

         Service  revenues are billed and  recognized in the period the services
are rendered.

         The  Company  accounts  for  shipping  and  handling  fees and costs in
accordance  with EITF 00-10  "Accounting  for  Shipping  and  Handling  Fees and
Costs."  Such fees and costs  incurred  by the  Company  are  immaterial  to the
operations of the Company.

         In accordance with SFAS 48, "Revenue  Recognition  when Right of Return
Exists," revenue is recorded net of an estimate of markdowns,  price concessions
and  warranty  costs.  Such  reserve  is based  on  management's  evaluation  of
historical experience, current industry trends and estimated costs.

         The Securities and Exchange Commission issued Staff Accounting Bulletin
104 ("SAB 104"),  "Revenue  Recognition," which outlines the basic criteria that
must be met to recognize  revenue and  provides  guidance  for  presentation  of
revenue and for disclosure related to revenue recognition  policies in financial
statements  filed  with  the  Securities  and  Exchange  Commission.  Management
believes that the Company's revenue  recognition policy for services and product
sales conforms to SAB 104. The Company recognizes revenue of long-term contracts
pursuant  to  Statement  of  Position  81-1,   "Accounting  for  Performance  of
Construction - Type and Certain Production - Type Contracts."

         Method of Accounting for Long-Term Contracts

         The Company uses the  percentage-of-completion  method of accounting to
account for long-term  contracts  and,  therefore,  takes into account the cost,
estimated earnings and revenue to date on fixed-fee contracts not yet completed.
The  percentage-of-completion  method is used because management considers total
cost to be the best available  measure of progress on the contracts.  Because of
inherent  uncertainties in estimating costs, it is at least reasonably  possible
that the estimates used will change within the near term.

         The amount of revenue  recognized at the statement  date is the portion
of the  total  contract  price  that  the  cost  expended  to date  bears to the
anticipated  final cost, based on current  estimates of cost to complete.  It is
not related to the progress  billings to customers.  Contract  costs include all
materials,  direct  labor,  machinery,  subcontract  costs  and  allocations  of
indirect overhead.

         Because long-term  contracts may extend over a period of time,  changes
in job performance, changes in job conditions and revisions of estimates of cost
and  earnings  during the  course of the work are  reflected  in the  accounting
period in which the facts that require the revision  become known. At the time a
loss on a contract  becomes known,  the entire amount of the estimated  ultimate
loss is recognized in the consolidated financial statements.

         Contracts that are  substantially  complete are  considered  closed for
consolidated  financial  statement  purposes.  Revenue  earned on  contracts  in
progress in excess of  billings  (under  billings)  is  classified  as a current
asset. Amounts billed in excess of revenue earned  (overbillings) are classified
as a current liability.

         Other Significant Accounting Policies

         Other significant  accounting  policies not involving the same level of
measurement  uncertainties,  as those discussed above are nevertheless important
to an  understanding  of the  financial  statements.  The  policies  related  to
consolidation  and loss  contingencies  require  difficult  judgments on complex
matters that are often subject to multiple  sources of  authoritative  guidance.
Certain of these  matters are among  topics  currently  under  reexamination  by


                                       8
<PAGE>

accounting  standards setters and regulators.  Although no specific  conclusions
reached by these  standards  setters appear likely to cause a material change in
the Company's accounting policies, outcomes cannot be predicted with confidence.
Also see Note 1 of the Notes to  Condensed  Consolidated  Financial  Statements,
Organization and Significant  Accounting  Policies,  which discusses  accounting
policies  that  must  be  selected  by  management  when  there  are  acceptable
alternatives.


ITEM 3. CONTROLS AND PROCEDURES

         Our Chief Executive Officer who is also our Chief Financial Officer has
evaluated  the  effectiveness  of the design  and  operation  of our  disclosure
controls  and  procedures  in  accordance  with Rule  13a-14  of the  Securities
Exchange Act of 1934 (the "Exchange Act"). Based on his evaluation, he concluded
that,  as of the end of the  period  covered  by  this  report,  our  disclosure
controls  and  procedures  were  effective  in enabling  us to record,  process,
summarize and report in a timely manner the information required to be disclosed
in reports we file under the Exchange Act.

         No change in our internal  control over  financial  reporting  occurred
during the three months ended  September 30, 2004 that has materially  affected,
or is  reasonable  likely  to  materially  affect,  our  internal  control  over
financial reporting.


                                       9
<PAGE>

PART II.  OTHER INFORMATION

Item 1.  Legal Proceedings

         None.

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

         On August 2004, a shareholder converted 2,820 Preferred Shares Series C
         in to 47,000 shares of common stock. The shares were issued pursuant to
         an exemption provided by Section 3(a)(10).

Item 3.  Defaults Upon Senior Securities

      1.    A note  payable  to an  unaffiliated  third  party in the  amount of
            $500,000 with an interest of 10% per annum,  matured in May 2003 and
            is currently in default.  The interest  rate  increased to 12% after
            the maturity date.

      2.    A note  payable  to an  unaffiliated  third  party in the  amount of
            $250,000  with an interest of 8% per annum,  matured in May 2003 and
            is currently in default.  The interest  rate  increased to 12% after
            the maturity due date.

      3.    A note  payable  to an  unaffiliated  third  party in the  amount of
            $250,000 that was in default was extended  until  December 31, 2003.
            Originally,  the  Company  issued  to the note  holder  warrants  to
            purchase 100,000 shares of the Company's  restricted common stock at
            an  exercise  price  of  $2.00  valued  at  $106,000  (based  on the
            Black-Scholes option pricing model), which the Company has amortized
            to interest expense during the year ended December 31, 2002. As part
            of an extension  agreement,  the Company  effectively  cancelled the
            original  100,000  warrants and issued warrants to purchase  200,000
            shares of common stock at an exercise  price of $1.00,  which vested
            upon grant and expire in December 2003.

      4.    A promissory  note to an  unaffiliated  third party in the amount of
            $215,000  with an interest  of 15% per annum,  matured in March 2002
            and is currently in default.


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

         None.

Item 5.  Other Information

         None.

Item 6.  Exhibits

         (a)  Exhibits:

            31.1  302 Sarbanes  Oxley  Certification  of David  Duquette,  Chief
                  Executive Officer and Chief Financial Officer

            32.1  906 Sarbanes Oxley Certification


                                       10
<PAGE>


                                   SIGNATURES

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


November 19, 2004                       /s/ David Duquette
                                        ----------------------------------------
                                        Name:  David Duquette
                                        Title: Chief Executive Officer and Chief
                                               Financial Officer



                                       11


<PAGE>

                       NEW CENTURY COMPANIES, INC. AND SUBSIDIARY
                          CONDENSED CONSOLIDATED BALANCE SHEET
                             September 30, 2004 (unaudited)

-------------------------------------------------------------------------------

                                         ASSETS

<TABLE>
<CAPTION>
<S>                                                                         <C>
Current Assets
        Cash                                                                $      3,212
        Contracts receivable                                                     129,017
        Inventories, net                                                       1,224,671
        Costs in excess net of billings on uncompleted contracts                 283,183
        Prepaid expenses and other current assets                                 20,310
                                                                            ------------

             Total current assets                                              1,660,393

Property and Equipment, net                                                      400,038
                                                                            ------------

                                                                            $  2,060,431
                                                                            ============


                         LIABILITIES AND STOCKHOLDERS' DEFICIT

Current Liabilities
        Bank overdraft                                                      $    115,042
        Accounts payable and accrued expenses                                  1,993,060
        Dividends payable                                                        314,250
        Billings in excess of costs on uncompleted contracts                     637,418
        Notes payable                                                          1,215,000
        Current portion of obligations under capital lease                        79,575
                                                                            ------------

             Total current liabilities                                         4,354,345

Obligations Under Capital Lease, net of current portion                            4,467
                                                                            ------------

Total Liabilities                                                              4,358,812
                                                                            ------------

Commitments and Contingencies

Stockholders' Deficit
        Cumulative, convertible, Series B preferred stock, $1 par value,
        15,000,000 shares authorized, no shares issued and outstanding                --
        Cumulative, convertible, Series C preferred stock, $1 par value,
        75,000 shares authorized, 60,780 shares issued and outstanding
        (liquidation preference of $1,904,000)                                    60,780
        Cumulative, convertible, Series D preferred stock, $25 par value,
        75,000 shares authorized, 23,640 shares issued and outstanding
        (liquidation preference of $591,000)                                     591,000
        Common stock, $0.10 par value, 50,000,000 shares authorized;
         7,042,265 shares issued and outstanding                                 704,227
        Subscriptions receivable                                                (462,500)
        Notes receivable from stockholders                                      (466,159)
        Additional paid-in capital                                             3,970,974
        Accumulated deficit                                                   (6,696,703)
                                                                            ------------

        Total stockholders' deficit                                           (2,298,381)
                                                                            ------------

                                                                            $  2,060,431
                                                                            ============
</TABLE>

   See accompanying notes to the condensed consolidated financial statements.

<PAGE>


-------------------------------------------------------------------------------

                   NEW CENTURY COMPANIES, INC. AND SUBSIDIARY
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
         For the Three and Nine Months Ended September 30, 2004 and 2003

-------------------------------------------------------------------------------




<TABLE>
<CAPTION>
                                                         For the Three Months           For the Nine Months
                                                      Ended September 30, 2004       Ended September 30, 2004
                                                   ----------------------------   -----------------------------
                                                       2004             2003           2004             2003
                                                   ----------------------------   -----------------------------
                                                    (unaudited)     (unaudited)    (unaudited)      (unaudited)

<S>                                                <C>             <C>             <C>             <C>
  NET SALES                                        $  1,166,947    $  2,108,964    $  3,728,016    $  5,764,936

  COST OF SALES                                       1,372,871       1,766,618       3,907,423       5,550,190
                                                   ------------    ------------    ------------    ------------

  GROSS PROFIT (LOSS)                                  (205,924)        342,346        (179,407)        214,746
                                                   ------------    ------------    ------------    ------------

OPERATING EXPENSES
  Consulting and other compensation                      16,306              --         202,819              --
  Salaries and related                                   78,689              --         207,437              --
  Selling, general and administrative                   149,824         363,750         571,188       1,132,961
  Loss of deposit                                            --              --              --         465,428
                                                   ------------    ------------    ------------    ------------
  TOTAL OPERATING EXPENSES                              244,819         363,750         981,444       1,598,389
                                                   ------------    ------------    ------------    ------------

OPERATING LOSS                                         (450,743)        (21,404)     (1,160,851)     (1,383,643)
                                                   ------------    ------------    ------------    ------------

  OTHER INCOME (EXPENSE)
  Gain on forgiveness of accounts payable                 4,812              --         549,870              --
  Interest Expense                                      (46,099)        (78,454)       (132,901)       (220,671)
                                                   ------------    ------------    ------------    ------------
  TOTAL OTHER INCOME (EXPENSE)                          (41,287)        (78,454)        416,969        (220,671)
                                                   ------------    ------------    ------------    ------------


LOSS BEFORE PROVISION
FOR INCOME TAXES                                       (492,030)        (99,858)       (743,882)     (1,604,314)

PROVISION FOR INCOME TAXES                                   --             867              --           2,467
                                                   ------------    ------------    ------------    ------------

NET LOSS                                           $   (492,030)   $   (100,725)   $   (743,882)   $ (1,606,781)
                                                   ============    ============    ============    ============

NET LOSS APPLICABLE
TO COMMON STOCKHOLDERS                             $   (531,780)   $   (140,475)   $   (863,132)   $ (1,704,281)
                                                   ============    ============    ============    ============

Basic and diluted net loss available to
common stockholders per common share               $      (0.08)   $      (0.02)   $      (0.12)   $      (0.28)
                                                   ============    ============    ============    ============

Basic and diluted weighted average common shares
  outstanding                                         7,018,765       6,150,828       6,975,321       6,007,231
                                                   ============    ============    ============    ============
</TABLE>


   See accompanying notes to the condensed consolidated financial statements.

<PAGE>



-------------------------------------------------------------------------------

                   NEW CENTURY COMPANIES, INC. AND SUBSIDIARY
                    CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                 For The Nine Months Ended September 30, 2004 and 2003

-------------------------------------------------------------------------------


<TABLE>
<CAPTION>
                                                                              2004            2003
                                                                          ------------    ------------
                                                                           (unaudited)     (unaudited)
<S>                                                                       <C>             <C>
Cash flows from operating activities:
     Net loss                                                             $   (743,882)   $ (1,606,781)
     Adjustments to reconcile net loss to net cash
      (used in) provided by operating activities:
         Depreciation and amortization of property and equipment               207,215         225,464
         Gain on forgiveness of accounts payable                               545,058              --
         Amortization of consulting fees                                       109,813          55,833
         Amortization of debt discount on notes payable                             --          45,000
         Estimated fair market value of common stock issued for
             consulting services                                                50,000         111,812
         Estimated fair market value of warrants issued in connection
             with notes payable                                                     --          17,350
         Changes in operating assets and liabilities:
             Contracts receivable                                               21,434         876,650
             Inventories                                                       (67,728)        159,352
             Costs in excess of billings on uncompleted contracts               37,349           5,971
             Prepaid expenses and other current assets                           5,381         (24,010)
             Deposits                                                               --         471,800
             Accounts payable and accrued expenses                            (834,682)        (15,640)
             Billings in excess of costs on uncompleted contracts               69,804         168,843
                                                                          ------------    ------------

     Net cash (used in) provided by operating activities                      (600,238)        491,644
                                                                          ------------    ------------

Cash flows from investing activities:
     Purchases of property and equipment                                        (1,396)        (10,257)
                                                                          ------------    ------------

     Net cash used in investing activities                                      (1,396)        (10,257)
                                                                          ------------    ------------

Cash flows from financing activities:
     Proceeds from issuance of preferred stock                                 521,000              --
     Bank overdraft                                                             (9,516)          7,333
     Proceeds from the issuance of notes payable                                    --         455,000
     Principal repayments on notes payable                                          --        (900,000)
     Principal repayments on obligations under capital lease                   (62,607)        (68,359)
                                                                          ------------    ------------

     Net cash provided by (used in) financing activities                       448,877        (506,026)
                                                                          ------------    ------------

Net decrease in cash                                                          (152,757)        (24,639)

Cash at beginning of period                                                    155,969          80,276
                                                                          ------------    ------------

Cash at end of period                                                     $      3,212    $     55,637
                                                                          ============    ============


Supplemental disclosure of non-cash investing and financing activities:

         Dividends payable                                                $     79,500    $     28,875
                                                                          ============    ============
         Conversion of preferred stock to common stock                    $      4,700    $         --
                                                                          ============    =============
         Preferred stock issued in lieu of accounts payable               $     40,000    $         --
                                                                          ============    =============
</TABLE>



   See accompanying notes to the condensed consolidated financial statements.



<PAGE>

-------------------------------------------------------------------------------

                   NEW CENTURY COMPANIES, INC. AND SUBSIDIARY
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
             FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003

-------------------------------------------------------------------------------

1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES

ORGANIZATION AND NATURE OF OPERATIONS

New Century  Companies,  Inc. and Subsidiary  (collectively,  the "Company"),  a
California  corporation,  was incorporated March 1996 and is located in Southern
California.  The Company provides after-market  services,  including rebuilding,
retrofitting and remanufacturing of metal cutting machinery.  Once completed,  a
remanufactured  machine is "like new" with state-of-the-art  computers,  and the
cost to the  Company's  customers is  approximately  40% to 50% of that of a new
machine.

The Company  currently  sells its services by direct sales and through a network
of machinery  dealers  across the United  States.  Its  customers  are generally
medium to large sized manufacturing  companies in various industries where metal
cutting is an integral part of their  businesses.  The Company  grants credit to
its customers who are predominately located in the western United States.

The  Company  completed  a  reverse  merger  in May 2001 and  trades  on the OTC
Bulletin Board under the symbol "NCNC.OB."

BASIS OF PRESENTATION

The accompanying  unaudited interim condensed  consolidated financial statements
have been prepared by the Company,  pursuant to the rules and regulations of the
Securities and Exchange Commission (the "SEC"). Certain information and footnote
disclosures  normally  included in financial  statements  prepared in accordance
with accounting  principles  generally  accepted in the United States of America
have been omitted pursuant to such SEC rules and regulations;  nevertheless, the
Company  believes  that the  disclosures  are  adequate to make the  information
presented not misleading. These financial statements and the notes hereto should
be read in conjunction with the financial  statements,  accounting  policies and
notes  thereto  included in the  Company's  Annual Report on Form 10-KSB for the
year ended December 31, 2003, filed with the SEC. In the opinion of the Company,
all adjustments, including normal recurring adjustments necessary of the Company
for the interim  periods have been  included.  The results of operations for the
interim period are not necessarily indicative of the results for the full year.

PRINCIPLES OF CONSOLIDATION

The  condensed  consolidated  financial  statements  include the accounts of New
Century   Companies,   Inc.  and  its  wholly  owned  subsidiary,   New  Century
Remanufacturing  (collectively,  the "Company").  All  significant  intercompany
accounts and transactions have been eliminated in consolidation.

GOING CONCERN

The accompanying  condensed consolidated financial statements have been prepared
assuming the Company will continue as a going concern, which contemplates, among
other things,  the realization of assets and  satisfaction of liabilities in the
normal course of business.  As of September  30, 2004,  the Company has negative
working  capital  of  $2,693,952,  an  accumulated  deficit  of  $6,696,703  and
recurring

<PAGE>

-------------------------------------------------------------------------------

                   NEW CENTURY COMPANIES, INC. AND SUBSIDIARY
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
             FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003

-------------------------------------------------------------------------------


1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (continued)

GOING CONCERN (continued)

losses from operations.  These factors,  among others,  raise  substantial doubt
about the Company's ability to continue as a going concern.  The Company intends
to fund  operations  through  increased  sales  and  debt and  equity  financing
arrangements  which management  believes may be insufficient to fund its capital
expenditures,  working capital and other cash  requirements  for the year ending
December 31, 2005.  Therefore,  the Company will be required to seek  additional
funds to finance its  long-term  operations.  The  successful  outcome of future
activities  cannot be determined at this time and there is no assurance  that if
achieved,  the  Company  will have  sufficient  funds to  execute  its  intended
business plan or generate positive operating results.

In response to these problems, management has taken the following actions:

      o     The Company continues its aggressive program for selling inventory.
      o     The Company continues to implement plans to further reduce operating
            costs.
      o     The Company is seeking investment capital through the public
            markets.

The condensed  consolidated  financial statements do not include any adjustments
related to recoverability  and  classification of assets carrying amounts or the
amount and classification of liabilities that might result should the Company be
unable to continue as a going concern.

INVENTORY

Inventories  are stated at the lower of cost or net  realizable  value.  Cost is
determined under the first-in,  first-out method.  Inventories represent cost of
work in  process  on units not yet under  contract.  Cost  includes  all  direct
material  and labor,  machinery,  subcontractors  and  allocations  of  indirect
overhead.

REVENUE RECOGNITION

Service  revenues  are billed and  recognized  in the  period the  services  are
rendered.

The Company accounts for shipping and handling fees and costs in accordance with
EITF 00-10  "Accounting for Shipping and Handling Fees and Costs." Such fees and
costs incurred by the Company are immaterial to the operations of the Company.

In accordance with SFAS 48, "Revenue  Recognition  when Right of Return Exists,"
revenue is recorded  net of an  estimate of  markdowns,  price  concessions  and
warranty costs.  Such reserve is based on management's  evaluation of historical
experience, current industry trends and estimated costs.

The Securities and Exchange Commission issued Staff Accounting Bulletin 104
("SAB 104"), "Revenue

<PAGE>

-------------------------------------------------------------------------------

                   NEW CENTURY COMPANIES, INC. AND SUBSIDIARY
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
             FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003

-------------------------------------------------------------------------------


1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (continued)

REVENUE RECOGNITION (continued)

Recognition,"  which  outlines the basic  criteria that must be met to recognize
revenue and provides  guidance for  presentation  of revenue and for  disclosure
related to revenue recognition  policies in financial  statements filed with the
Securities  and Exchange  Commission.  Management  believes  that the  Company's
revenue  recognition  policy for services and product sales conforms to SAB 104.
The Company recognizes  revenue of long-term  contracts pursuant to Statement of
Position 81-1,  "Accounting  for  Performance of  Construction-Type  and Certain
Production-Type Contracts" (see below).

METHOD OF ACCOUNTING FOR LONG-TERM CONTRACTS

The Company uses the  percentage-of-completion  method of  accounting to account
for long-term contracts and, therefore,  takes into account the cost,  estimated
earnings  and revenue to date on  fixed-fee  contracts  not yet  completed.  The
percentage-of-completion  method is used because management considers total cost
to be the best  available  measure  of  progress  on the  contracts.  Because of
inherent  uncertainties in estimating costs, it is at least reasonably  possible
that the estimates used will change within the near term.

The amount of revenue  recognized  at the  statement  date is the portion of the
total  contract  price that the cost  expended to date bears to the  anticipated
final cost, based on current estimates of cost to complete. It is not related to
the progress billings to customers. Contract costs include all materials, direct
labor, machinery, subcontract costs and allocations of indirect overhead.

Because  long-term  contracts  may extend over a period of time,  changes in job
performance,  changes in job  conditions  and revisions of estimates of cost and
earnings during the course of the work are reflected in the accounting period in
which the facts that require the revision  become known. At the time a loss on a
contract  becomes  known,  the entire amount of the  estimated  ultimate loss is
recognized in the consolidated financial statements.

Contracts that are substantially complete are considered closed for consolidated
financial statement purposes.  Revenue earned on contracts in progress in excess
of billings (under billings) is classified as a current asset. Amounts billed in
excess of revenue earned (overbillings) are classified as a current liability.

BASIC AND DILUTED LOSS PER COMMON SHARE

Under SFAS 128,  "Earnings  Per  Share,"  basic  earnings  per  common  share is
computed  by  dividing   income   available  to  common   stockholders   by  the
weighted-average  number of common shares assumed to be  outstanding  during the
period of computation.  Diluted  earnings per share is computed similar to basic
earnings  per share  except that the  denominator  is  increased  to include the
number of  additional  common  shares  that would have been  outstanding  if the
potential common shares had been issued and if

<PAGE>


-------------------------------------------------------------------------------

                   NEW CENTURY COMPANIES, INC. AND SUBSIDIARY
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
             FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003

-------------------------------------------------------------------------------

1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (continued)

BASIC AND DILUTED LOSS PER COMMON SHARE (continued)

the  additional  common shares were dilutive  (there were  1,821,583 and 871,853
additional   potential   common   shares  of   September   30,  2004  and  2003,
respectively).  Because the Company has incurred  net losses,  basic and diluted
loss per share  are the same as  additional  potential  common  shares  would be
anti-dilutive.

The following is a  reconciliation  of the  numerators and  denominators  of the
basic and diluted earnings (loss) per share computations for the three month and
nine month periods ended September 30, 2004 and 2004:

<TABLE>
<CAPTION>
                                                    FOR THE THREE MONTHS ENDED
                                                           SEPTEMBER 30,
                                                    --------------------------
                                                       2004           2003
                                                    -----------    -----------
<S>                                                 <C>            <C>
Net loss                                            $  (492,030)   $  (100,725)
Current cumulative preferred dividends                  (39,750)       (39,750)
                                                    -----------    -----------
Numerator for basic and diluted loss per share:
Net loss applicable to common stockholders             (531,780)      (140,475)

Denominator for basic and diluted loss per share:
Weighted average shares                               7,018,765      6,150,828
                                                    -----------    -----------

Basic and diluted loss per share                    $     (0.08)   $     (0.02)
                                                    ===========    ===========
</TABLE>


<TABLE>
<CAPTION>
                                                      FOR THE NINE MONTHS ENDED
                                                            SEPTEMBER 30,
                                                    ----------------------------
                                                        2004            2003
                                                    ------------    ------------
<S>                                                 <C>             <C>
Net loss                                            $   (743,882)   $ (1,606,781)
Current cumulative preferred dividends                  (119,250)        (97,500)
                                                    ------------    ------------
Numerator for basic and diluted loss per share:
Net loss applicable to common stockholders              (863,132)     (1,704,281)

Denominator for basic and diluted loss per share:
Weighted average shares                                6,975,321       6,007,231
                                                    ------------    ------------

Basic and diluted loss per share                    $      (0.12)   $      (0.28)
                                                    ============    ============
</TABLE>

<PAGE>


-------------------------------------------------------------------------------

                   NEW CENTURY COMPANIES, INC. AND SUBSIDIARY
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
             FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003

-------------------------------------------------------------------------------

1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (continued)

STOCK BASED COMPENSATION

At September 30, 2004,  the Company has one  stock-based  employee  compensation
plan and one stock-based  non-employee  compensation  plan. The Company accounts
for the  employee  compensation  plan  under  the  recognition  and  measurement
principles of APB 25, and related  interpretation.  The Company accounts for the
non-employee  compensation plan under the recognition  measurement principles of
SFAS 123. There was no employee stock-based  compensation cost recognized in net
loss for the nine- month period ended  September 30, 2004 and 2003.  All options
granted under these plans had an exercise price equal to the market value of the
underlying  common stock on the date of grant.  The following table  illustrates
the effect on net income and  earnings  per share if the Company had applied the
fair  value  recognition   provisions  of  SFAS  123  to  stock-based   employee
compensation.


<TABLE>
<CAPTION>
                                                        FOR THE NINE MONTHS ENDED
                                                              SEPTEMBER 30,
                                                          2004            2003
                                                      ------------    ------------
<S>                                                   <C>             <C>
Net loss applicable to common stockholders:
    As reported                                       $   (863,132)   $ (1,704,781)
    Deduct: Total stock-based employee compensation
          expense determined under fair value based
          method for all awards                                 --              --
                                                      ------------    ------------
    Pro forma                                         $   (863,132)   $ (1,704,781)
                                                      ============    ============

Basic and diluted net loss per share:
    As reported                                       $      (0.12)   $      (0.28)
                                                      ============    ============
    Pro forma                                         $      (0.12)   $      (0.28)
                                                      ============    ============
</TABLE>

The  above  pro  forma  effects  of  applying  SFAS  123  are  not   necessarily
representative of the impact on reported net loss for future years.

NEW ACCOUNTING PRONOUNCEMENTS

Recent accounting pronouncements discussed in the notes to the December 31, 2003
and 2002 financial  statements filed previously with the Securities and Exchange
Commission  in Form  10-KSB  that were  required  to be adopted  during the year
ending  December  31, 2004 did not have a  significant  impact on the  Company's
financial statements.

<PAGE>


-------------------------------------------------------------------------------

                   NEW CENTURY COMPANIES, INC. AND SUBSIDIARY
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
             FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003

-------------------------------------------------------------------------------

1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (continued)

RECLASSIFICATIONS

Certain  reclassifications  have  been made to the 2003  condensed  consolidated
financial statements to conform to the 2004 presentation.


2. CONTRACTS IN PROGRESS

Contracts in progress as of September 30, 2004 were as follows:

<TABLE>
<CAPTION>
<S>                                                                                <C>
 Cumulative costs to                                                               $  6,137,881
 date
 Cumulative gross profit to                                                           3,744,336
 date
                                                                                   ------------

 Cumulative revenue earned                                                            9,882,217

 Less progress billings to date                                                     (10,236,452)
                                                                                   ------------

      Net overbillings                                                             $   (354,235)
                                                                                   ============

The following is included in the  accompanying  condensed  consolidated  balance
sheet under these captions as of September 30, 2004:

 Costs and  estimated  earnings on contracts in progress in excess
    of billings                                                                    $    283,183
 Billings in excess of costs and estimated earnings on
    contracts in progress                                                              (637,418)
                                                                                   ------------

      Net overbillings                                                             $   (354,235)
                                                                                   ============
</TABLE>


3. EQUITY TRANSACTIONS

During the quarter ended September 30, 2004, the Company issued 47,000 shares of
restricted  common stock upon  conversion  of 2,820 shares of Series C preferred
stock at a conversion rate of 16.667.