SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended March 31, 2005
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from__________to__________.
Commission File No. 0-27929
ETERNAL TECHNOLOGIES GROUP, INC.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Nevada 62-1655508
- ------------------------------- ---------------------------------
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
Sect D, 5/F, Block A, Innotec Tower, 235 Nanjing Road
Heping District, Tianjin, 300052
-----------------------------------------------------------------
(Address of principal executive offices)
011-86-22-2721-7020
-------------------------
(Issuer's telephone number)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days. YES X NO
As of May 15, 2005, 30,679,630 shares of Common Stock of the issuer were
outstanding.
Eternal Technologies Group, Inc.
INDEX
Page
Number
PART I - FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements
Consolidated Balance Sheets - March 31, 2005 (unaudited)and
December 31, 2004 3
Unaudited Consolidated Statements of Income - For the
three months ended March 31, 2005 and 2004 4
Unaudited Consolidated Statements of Cash Flows-
For the three months ended March 31, 2005 and 2004 5
Notes to Unaudited Consolidated Financial Statements 6
Item 2. Management Discussion and Analysis or Plan of Operations 9
Item 3. Controls and Procedures 10
PART II - OTHER INFORMATION
Item 1. Legal Proceedings 10
Item 2. Changes in Securities and Small Business Issuers 10
Purchaser of Equity Securities 10
Item 3. Defaults Upon Senior Securities 10
Item 4. Submission of Matters to a Vote of Security Holders 10
Item 5. Other Information 10
Item 6. Exhibits and Reports on Form 8-K 10
Signatures 10
Certifications 12
2
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
ETERNAL TECHNOLOGIES GROUP INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
MARCH 31, 2005
(UNITED STATES DOLLARS)
ASSETS
March 31 December 31
2005 2004
--------------- ---------------
--------------- ---------------
(Unaudited) (Audited)
CURRENT ASSETS
Cash and Cash equivalents $26,987,302 $27,473,354
Accounts receivable 2,577,783 1,538,313
Inventories 621,307 621,307
Prepayments and deposits 602 602
------------ -----------
30,186,994 29,633,576
TOTAL CURRENT ASSETS
FIXED ASSETS
(net of accumulated depreciation of $2,584,189 in 2005 5,775,983 5,904,050
and $2,456,122 in 2004
LAND USE RIGHTS
(net of accumulated amortization of $1,117,461
in 2005 and $1,055,361 in 2004 4,882,539 4,944,639
------------ ------------
TOTAL ASSETS $40,845,516 $40,482,265
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Notes payable $ 443,366 $ 443,366
Accounts payable and accrued expenses 1,679,712 1,526,595
Amounts due to related parties 290,465 272,465
------------ ------------
TOTAL CURRENT LIABILITIES 2,413,543 2,242,426
SHAREHOLDERS' EQUITY
Preferred shares - 5,000,000 authorized $.001 par -
none issued
Common shares - 95,000,000 shares authorized, at
$.001 par, 30,679,630 and 30,679,630 shares issued
and outstanding at March 31, 2005 and December
31, 2004, respectively 30,679 30,679
Paid - in capital 9,965,208 9,740,830
Stock subscription receivable (10,176) (10,176)
Retained earnings 28,446,262 28,478,506
------------- --------------
TOTAL SHAREHOLDERS' EQUITY 38,431,973 38,239,839
------------- ---------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $40,845,516 $40,482,265
============= ===============
See Notes to Consolidated Financial Statements
3
ETERNAL TECHNOLOGIES GROUP INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004
(UNITED STATES DOLLARS)
March 31
-------------------------------
-------------------------------
2005 2004
------------- -------------
------------- -------------
(Unaudited) (Unaudited)
SALES $2,108,747 $2,044,578
COST OF SALES 1,566,434 1,449,937
------------ -------------
GROSS PROFIT 542,313 594,641
DEPRECIATION AND AMORTIZATION 190,167 190,188
SELLING AND ADMINISTRATIVE EXPENSES 433,232 368,154
OTHER INCOME (EXPENSE)
Interest Income 48,842 26,380
Impairment Loss - (53,517)
------------ -------------
NET INCOME BEFORE INCOME TAXES (32,244) 9,162
INCOME TAXES - -
------------ -------------
NET INCOME (LOSS) ($32,244) $ 9,162
============ =============
EARNINGS PER SHARE
Basic and diluted
Net income (loss) ($0.00) $ 0.00
============ ============
Weighted average number of common
shares outstanding
Basic 30,679,630 29,337,381
============= ===========
Diluted 30,785,938 29,337,381
============= ===========
4
See Notes to Consolidated Financial Statements
ETERNAL TECHNOLOGIES GROUP INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004
(UNITED STATES DOLLARS)
March 31
----------------------------
----------------------------
2005 2004
----------- -----------
(Unaudited) (Unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (Loss) $(32,244) $ 9,162
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation and amortization 190,168 190,190
Stock issued for services - 45,000
Non-cash expenses for services 42,000 -
Impairment loss - 53,517
(Increase) decrease in assets:
Inventories - 5,600
Accounts receivable (1,039,470) (215,783)
Increase (decrease) in liabilities:
Accounts payable and accrued expenses 153,117 183,679
Amounts advanced by related parties 18,000 4,337
Account payable to related company - (107,161)
----------- -------------
Net cash provided (used in) by operating
activities (668,429) 168,541
----------- -------------
CASH FLOWS FROM FINANCING ACTIVIES
Capital Contributed 182,377 -
------------ -------------
Net cash provided by financing activities 182,377 -
------------ -------------
NET INCREASE (DECREASE) IN CASH AND
Cash Equivalents (486,052) 168,541
Cash and cash equivalents, beginning of period 27,473,354 16,302,464
------------- -------------
Cash and cash equivalents, at end of period $26,987,302 $16,471,005
============= =============
SUPPLEMENTARY CASH FLOWS DISCLOSURES
1. Interest paid - -
Taxes paid - -
2. During the quarter ended March 31, 2004, 109,984 shares were issued for the
payment of notes payable of $60,491. 100,000 shares were issued related to
services and prepaid services totaling $90,000.
5
See Notes to Consolidated Financial Statements
ETERNAL TECHNOLOGIES GROUP INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
MARCH 31, 2005
- --------------------------------------------------------------------------------
NOTES
1. Reporting entity
Pursuant to an exchange agreement, Eternal Technologies Group,
Inc., ("Company") formerly known as Waterford Sterling
Corporation, completed its acquisition of 100% interest of Eternal
Group Limited and Subsidiaries on December 12, 2002. The Company
has treated the transaction as a reverse merger for accounting
purposes. Following the acquisition, the former shareholders of
Eternal Technology Group Limited, a British Virgin Islands limited
liability company, now owns approximately 85% of the issued and
outstanding common shares of Eternal Technologies Group Inc.
Eternal Phoenix Company Limited was incorporated in the British
Virgin Islands with limited liability on March 3, 2000. Pursuant
to a resolution passed on June 17, 2000 Eternal Phoenix Company
Limited changed its name to ETERNAL TECHNOLOGY GROUP LTD.,
("Eternal"). Eternal is a holding company for investments in
operating companies.
Eternal acquired a 100% equity interest in Willsley Company
Limited ("Willsley"), a company incorporated in the British Virgin
Island with limited liability on May 16, 2000.
Willsley's principal activity is investments and owns 100%
interest in Inner Mongolia Aershan Agriculture & Husbandry
Technology Co., Ltd ("Aershan").
Aershan was incorporated in the People's Republic of China ("the
PRC") with limited liability on July 11, 2000 and its principal
activities are to run a breeding center, transplant embryos, and
to propagate quality meat sheep and other livestock breeds in
Inner Mongolia.
6
2. Condensed financial statements and footnotes
The interim consolidated financial statements presented herein
have been prepared by the Company and include the unaudited
accounts of the Company and its subsidiaries. All significant
inter-company accounts and transactions have been eliminated in
the consolidation.
These condensed financial statements have been prepared in
accordance with generally accepted accounting principles for
interim financial information and the instructions to Form 10-QSB
and Item 310 (b) Regulation S-B. Certain information and footnote
disclosures normally included in financial statements presented in
accordance with generally accepted accounting principles have been
condensed or omitted. The Company believes the disclosures made
are adequate to make the information presented not misleading. The
condensed consolidated financial statements should be read in
conjunction with the Company's consolidated financial statements
for the year ended December 31, 2004 and notes thereto included in
the Company's Form 10-KSB.
In the opinion of management, the unaudited condensed consolidated
financial statements reflect all adjustments (which include only
normal recurring adjustments) necessary to present fairly the
financial position of the Company as of March 31, 2005, the
results of operations for the three months ended March 31, 2005
and 2004, respectively. Interim results are not necessarily
indicative of full year performance because of the impact of
seasonal and short-term variations.
3. Cash
At March 31, 2005, approximately $26,984,574 of cash is to be
exclusively used for operations in the PRC.
4. Public relations agreement
On February 1, 2005, the Company entered into a six-month public
relations agreement with Empire Relations Group, Inc. (ERG). As
consideration for public relations services, the Company must
compensate ERG with 150,000 shares subject to Rule 144. For the three
months ended March 31, 2005, the Company expensed $37,500 associated
with this agreement.
7
5. Notes payable
The Company's promissory notes payable are in default at March 31,
2005 and the holder of the notes has filed suit for payment of the
notes. The Company believes it has meritorious defenses to the lawsuit
related to the notes.
6. Contingencies
In conjunction with certain subscription agreements entered into
during 2003, the Company has agreed to register the shares issued
under a Form SB-2 registration statement. There are penalties for not
timely meeting filing and effectiveness deadlines, and the Company has
received claims related to these penalties. For the three months ended
March 31, 2005, the Company has additional accrued expenses for
penalties of $30,441.
8
Item 2. Management Discussion and Analysis or Plan of Operation
The Company's business is highly seasonal, with most of the Company's revenue
and income being earned during the second half of the calendar year.
Accordingly, the results of operations for the calendar quarter ended March 31,
2005 are not indicative of the results for any other quarter or for the fiscal
year.
Three Months Ended March 31, 2005 compared to the Three Months Ended March 31,
2005
Revenues
Revenues for the three months ended March 31, 2005 increased by $64,169 or 3.1%
to $2,108,747 from $2,044,578 for the corresponding period of the prior year.
All of the revenue came from the processing and sale of lamb meat.
Cost of Sales
Cost of sales for the three months ended March 31, 2005 increased by $116,497 or
8.0% to $1,566,434 from $1,449,937 from the corresponding period of the prior
year. Our gross margin declined by 340 basis points from 29.1% to 25.7%
principally because of the higher price for sheep.
Depreciation and Amortization
Depreciation and amortization expense for the three months ended March 31, 2005
totalled $190,167, virtually unchanged from the $190,188 for the corresponding
period of the prior year.
Selling and Administrative Expenses
Selling and administrative expenses for the three months ended March 31, 2005
increased by $65,078 or 17.7% to $433,232 from $368,154 for the corresponding
period of the prior year. The increase in the selling and administrative
expenses is principally attributable to an increase in salaries of $58,678 and
an increase in professional fees of $69,309 which was partially offset by a
decrease in the penalty for the delay in the registration of $21,920 and a
decreases in marketing expense of $34,650.
Other Income (Expense)
Other income, all interest income, increased by $22,462 to $48,842 for the three
months ended March 31, 2005 from $26,380 for the corresponding period of the
prior year. The increase in interest income resulted from increased amounts on
deposit and higher rates paid.
Impairment Loss
The Company recorded no impairment loss for the three months ended March 31,
2005. For the corresponding period of the prior year it had an impairment loss
of $53,517 from the write down of property for sale at the Company's farm.
Net Income (Loss)
As a result of the foregoing, the Company reported a loss of $32,244 for
the three months ended March 31, 2005 compared to income of $9,162 for the
three months ended March 31, 2004. There were no income taxes recorded for
either three month period.
Liquidity and Capital Resources
As of March 31, 2005, the Company had cash of $26,987,302 and working
capital of $27,773,450. This compares with cash of $27,473,354 and working
capital of $27,391,150 at December 31, 2004.
Cash used in operating activities totaled $668,429 for the three months
ended March 31, 2005. This compares with cash flows from operating activities of
$168,541 for the three months ended March 31, 2004. The decrease in cash flows
resulted from changes in the current accounts, particularly an increase in
accounts receivable of $1,039,470 which was partially offset by non-cash
expenses of $42,000 and an increase in payables of $153,117 and depreciation and
amortization of $190,168.
There were no investing activities by the Company during either the three
months ended March 31, 2005 or 2004.
There were no financing activities for the three months ended March 31,
2004. Cash flows from financing activities for the three months ended March 31,
2005 totaled $182,377 all of which was from capital contributed.
9
Although the Company has a cash and bank balance of $26,987,302,
substantially all of it is to be exclusively used for operations within the
People's Republic of China. Therefore, if the Company is to expand outside the
PRC, as it anticipates doing, or pay its non-PRC obligation, it will have to
sell additional shares of its stock or borrow funds from third parties.
Item 3. Controls and Procedures
We strive to maintain disclosure controls and procedures that are designed to
ensure that information required to be disclosed in our Exchange Act reports is
recorded, processed, summarized and reported within the time periods specified
in the SEC's rules and forms, and that such information is accumulated and
communicated to our management, including our chief executive officer and chief
financial officer, as appropriate, to allow for timely decisions regarding
required disclosure. In designing and evaluating the disclosure controls and
procedures, management recognizes that any controls and procedures, no matter
how well designated and operated, can provide only reasonable assurance of
achieving the desired control objectives and management necessarily is required
to apply its judgment in evaluating the cost-benefit relationship of possible
controls. Our independent accountants, Thomas Leger & Co. LLP conducted audits
of our financial statements for 2002, 2003 and 2004. In connection with the
issuance of its report of the independent registered public accounting firm,
Thomas Leger & Co. LLP reported to our Board of Directors two material
weaknesses under standards established by the Public Company Accounting
Oversight Board regarding some elements of our system of internal controls. They
noted the following material deficiencies:
(i) The Company lacked certain procedures and required expertise needed to
properly account for non-rountine transactions (such as acquisitions of
other businesses) and preparation of its required financial statement
disclosure in accordance with U.S. G.A.A.P. and SEC rules and regulations.
(ii) The Company has restated its consolidated financial statements for the year
ended December 31, 2002 to reflect merger costs of $867,411 as
post-acquisition activity. This restatement adjustment is considered a
material weakness over financial reporting as defined by the PCAOB.
We have conducted a review of the errors requiring restatement, including a
separate review by our board of directors to determine what remedial measures
were necessary. We believe our management has taken or is in the process of
taking the steps necessary to correct the errors and avoid similar errors in the
future.
As required by SEC rule 13a-15(b) we conducted an evaluation, under the
supervision and with the participation of our management, including our Chief
Executive Officer and Chief Financial Officer, the effectiveness of the design
and operation of our disclosure controls and procedures. Based upon that
evaluation, the Chief Executive Officer, Chief Financial Officer concluded that
our disclosure controls and procedures are effectively in timely alerting them
to material information relating to us (including our subsidiaries) required to
be included in our periodic SEC filings.
Other than the foregoing initatives, there were no significant changes in our
internal controls or to our knowledge, in other factors that could significantly
affect such internal controls subsequent to the date of their evaluation.
While we have taken or are in the process of taking the foregoing steps in order
to address the adequacy of our disclosure controls and procedures, and, in
addition, to develop and implement a formal set of internal controls and
procedures for financial reporting in accordance with SEC's proposed rules to
adopt the internal control report requirements included in Section 404 of the
Sarbanes-Oxley Act of 2002, the effiency of the steps we have taken to date and
the steps we are still in the process of completing is subject to continued
management review supported by confirmation and testing by our external
auditors. As a result, it is likely that additional changes will be made to our
internal controls.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.
As of March 1, 2005, we were a party to two legal proceedings. The first is
a lawsuit brought by Western Securities Corporation. This cause of action
seeks payment of $500,942 on two outstanding promissory notes, one to
Market Management, Inc. and one to Thomas L. Tedrow plus accrued interest
since July 11, 2004, attorney's fees, cost of collection and other court
costs. This cause of action was filed in Federal Court in the Eastern
District of Louisiana. The Company has filed a Motion to Dismiss for lack
of personal jurisdiction or alternatively a Motion to Dismiss for lack of
venue. Both motions are currently pending before the court. The second
cause of action was filed in State Court in New York City by Bristol
Investments Limited against the company and is seeking the payment of the
penalty due under their original investment for failure to have a
registration effective within a stated period of time. Bristol is currently
seeking $53,000 in damages. A settlement is pending in this cause of action
and documents are being drafted to reflect this settlement agreement. Under
this settlement agreement a Convertible Debenture Note will be issued in
lieu of a cash payment. This Debenture is convertible into shares of the
company's common stock at a 20% discount to the five trading day closing
price prior to the date of settlement. Debentures have a maturity of two
years from the date of closing and any unconverted non-redeemed debentures
outstanding on the second anniversary of the closing date will be paid in
cash to the investor.
As of May 10, 2005 we are not a party to any other pending litigation and
were not aware of any threatened litigation.
Item 2. Changes in Securities
During the quarter ended March 31, 2004, 109,984 shares were issued for the
payment of notes payable of $60,491. 100,000 shares were also issued related to
services and prepaid services totaling $90,000. There were no securities issued
during the three months ended March 31, 2005.
Item. 3. Defaults Upon Senior Securities
None
Item 4. Submissions of Matters to a Vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
a) Exhibits
None
Signature
Pursuant to the requirement of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto authorized.
10
ETERNAL TECHNOLOGIES GROUP, INC.
/s/ Jiansheng Wei
-------------------------------------
May 20, 2005 Jiansheng Wei, Chief Executive Officer
/s/ Xingjian Ma
May 20, 2005 -------------------------------------
Xingjian Ma, Chief Financial Officer
11
CERTIFICATIONS
I, Jiansheng Wei, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of Eternal Technologies
Group, Inc.;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this quarterly report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date of this
quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our evaluation
as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent function):
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's internal
controls; and
6. The registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
Dated: May 20, 2005
By: /s/ Jiansheng Wei
---------------------
Jiansheng Wei
Chief Executive Officer
12
I, Xingjian Ma, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of Eternal Technologies
Group, Inc.
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this quarterly report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date of this
quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our evaluation
as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent function):
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's internal
controls; and
6. The registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
Dated: May 20, 2005
By: /s/ Xingjian Ma
--------------------
Xingjian Ma
Chief Financial Officer
13
CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER PURSUANT
TO 18 U.S.C. SECTION 1350, AS
ADOPTED PURSUANT TO SECTION 906 OF TEHE SARBANES-OXLEY ACT OF 2002
- --------------------------------------------------------------------------------
I, Jiansheng Wei, certify, pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Quarterly
Report of Eternal Technologies Group, Inc. on Form 10-QSB for the quarterly
period ended March 31, 2005 fully complies with the requirements of Section
13(a) or 15(d) of the Securities Exchange Act of 1934 and that information
contained in such Form 10-QSB fairly presents in all material respects the
financial condition and results of operations of Eternal Technologies Group,
Inc.
By: /s/ Jiansheng Wei
- --------------------------
Name: JiJun Wu
Title: Chief Financial Officer
May 20, 2005
14
CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER PURSUANT
TO 18 U.S.C. SECTION 1350, AS
ADOPTED PURSUANT TO SECTION 906 OF TEHE SARBANES-OXLEY ACT OF 2002
- --------------------------------------------------------------------------------
I, Xingjian Ma, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002, that the Quarterly Report of
Eternal Technologies Group, Inc. on Form 10-QSB for the quarterly period ended
March 31, 2005 fully complies with the requirements of Section 13(a) or 15(d) of
the Securities Exchange Act of 1934 and that information contained in such Form
10-QSB fairly presents in all material respects the financial condition and
results of operations of Eternal Technologies Group, Inc.
By: /s/ Xingjian Ma
- --------------------------
Name: Xingjian Ma
Title: Chief Financial Officer
May 20, 2005
15