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

                                   FORM 10-QSB


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

For the quarterly period ended March 31, 1998

Commission File No. 33-55254-39

                          PERIPHERAL CONNECTIONS, INC.
        (Exact name of Small Business Issuer as specified in its charter)


           NEVADA                                87-0485315
(State or other jurisdiction of                (I.R.S. Employer
incorporation or organization)                Identification No.)

                176 John Street Toronto, Ontario, Canada M5T1X5
                    (Address of principal executive offices)

Issuer's telephone number, including area code (416) 593-0859

                        3303 Don Mills Road, Suite 2603
               North York, Ontario, Canada M2J4T6 (416) 490-8500
                      Former address and telephone number

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

State the number of shares outstanding of each of the issuer's classes of common
stock, as of the latest  practicable date:  14,600,000 shares of $.001 par value
class A common stock outstanding as of April 10, 1998.

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


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<PAGE>



                          PERIPHERAL CONNECTIONS, INC.
                          FORM 10-QSB FOR QUARTER ENDED

                                 March 31, 1998
                                      INDEX

PART I - FINANCIAL INFORMATION                                         Page No.

         Item 1   Financial Statements

                           Balance Sheets as of
                           March 31, 1998 and December 31, 1997            5

                           Statements of Operations for the
                           three month periods ended
                           March 31, 1998 and 1997                         6

                           Statements of Cash Flows for the
                           three month periods ended
                           March 31, 1998 and 1997.                        7

                           Pro forma Balance Sheet                         8
                           Pro forma Statement of Operations               9

         Item 2   Management's Discussion and Analysis
                           and Plan of Operations                          10

PART II - OTHER INFORMATION

         Item 1   Legal Proceedings                                        11
         ------

         Item 2   Changes in Securities                                    11
         ------

         Item 3   Defaults Upon Senior Securities                          11
         ------

         Item 4   Submission of Matters to a Vote of
                           Security Holders                                11

         Item 5   Other Information                                        11
         ------

         Item 6   Exhibits and Reports on Form 8-K                         11
         ------






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<PAGE>



                         PART I - FINANCIAL INFORMATION


ITEM 1.  FINANCIAL STATEMENTS.

         In the opinion of the management of Peripheral  Connections,  Inc. (the
Company) the accompanying unaudited financial statements contain all adjustments
(consisting  only of normal recurring  adjustments)  necessary to present fairly
the financial  position as of March 31, 1998,  the results of operations for the
three month  periods  ended March 31, 1998 and 1997,  and the cash flows for the
three month periods ended March 31, 1998 and 1997.

         While the Company believes that the disclosures  presented are adequate
to make the  information  not  misleading,  it is suggested that these condensed
financial  statements be read in conjunction  with the financial  statements and
the notes included in the Company's latest annual report on Form 10-KSB.


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<PAGE>


                                 SMITH & COMPANY
                          A PROFESSIONAL CORPORATION OF
                          CERTIFIED PUBLIC ACCOUNTANTS

MEMBERS OF:                                   10 WEST 100 SOUTH, SUITE 700
AMERICAN INSTITUTE OF                         SALT LAKE CITY, UTAH 84101
     CERTIFIED PUBLIC ACCOUNTANTS             TELEPHONE:       (801) 575-8297
UTAH ASSOCIATION OF                           FACSIMILE:       (801) 575-8306
     CERTIFIED PUBLIC ACCOUNTANTS             E-MAIL: smith&co@smithandcocpa.com
--------------------------------------------------------------------------------



                          INDEPENDENT AUDITOR'S REPORT

The Board of Directors and Shareholders
Peripheral Connections, Inc.

The accompanying balance sheet of Peripheral  Connections,  Inc. as of March 31,
1998,  and the related  statements of  operations,  and cash flows for the three
months ended March 31, 1998 and 1997 were not audited by us and, accordingly, we
do not express an opinion on them.

We also express no opinion on the pro forma financial statements.

The balance  sheet as of December 31, 1997 was audited by us and we expressed an
unqualified  opinion on it in our report dated March 9, 1998,  except for Note 8
which was dated April 9, 1998, but we have not performed any auditing procedures
since that date.




                                             /s/ Smith & Company
                                        CERTIFIED PUBLIC ACCOUNTANTS

Salt Lake City, Utah
May 7, 1998


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<PAGE>



                          PERIPHERAL CONNECTIONS, INC.
                          (A Development Stage Company)
                                 Balance Sheets


<TABLE>
<CAPTION>
                                                                                      March 31,             Dec. 31,
                                                                                        1998                  1997
                                                                                     (Unaudited)            (Audited)
                                                                                  -----------------     -----------------
ASSETS
CURRENT ASSETS
<S>                                                                               <C>                   <C>              
           Cash                                                                   $           9,253     $          10,965
                                                                                  -----------------     -----------------

                                                         Total Current Assets                 9,253                10,965
                                                                                  -----------------     -----------------

                                                                 TOTAL ASSETS     $           9,253     $          10,965
                                                                                  =================     =================

LIABILITIES & EQUITY

CURRENT LIABILITIES
           Accounts payable                                                       $               0     $               0
                                                                                  -----------------     -----------------

                                                    Total Current Liabilities                     0                     0
                                                                                  -----------------     -----------------

                                                            Total Liabilities                     0                     0

STOCKHOLDERS' EQUITY

           Common Stock $0.001 par value
           Authorized - 25,000,000 shares
           Issued and outstanding 3,850,000 shares                                            3,850                 3,850
           Additional paid-in capital                                                       282,150               282,150
           Deficit accumulated during the development stage                                (276,747)             (275,035)
                                                                                  -----------------     -----------------

                                                   Total Stockholders' Equity                 9,253                10,965
                                                                                  -----------------     -----------------

                                                        TOTAL LIABILITIES AND
                                                         STOCKHOLDERS' EQUITY     $           9,253     $          10,965
                                                                                  =================     =================
</TABLE>



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<PAGE>



                          PERIPHERAL CONNECTIONS, INC.
                          (A Development Stage Company)
                            Statements of Operations
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                       For the
                                                                 Three Months Ended
                                                                      March 31,
                                                                1998            1997
                                                            -------------  -------------
<S>                                                         <C>            <C>          
Interest income                                             $         105  $           0
Expenses
           Administration                                           1,817          7,765
           Net Interest Expense                                         0          2,331
                                                            -------------  -------------
                                                                    1,817         10,096

Net Loss for Period                                                (1,712)       (10,096)

Deficit - beginning of Period                                    (275,035)       (12,772)
                                                            -------------  -------------

Deficit - end of Period                                          (276,747)       (22,868)

Net Loss per Share                                                    .00           (.01)

Average shares outstanding used to
           calculate net loss per share                         3,850,000      1,000,000
</TABLE>


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<PAGE>



                          PERIPHERAL CONNECTIONS, INC.
                          (A Development Stage Company)
                            Statements of Cash Flows
                                   (Unaudited)


<TABLE>
<CAPTION>
                                                                                                  For the
                                                                                            Three Months Ended
                                                                                                 March 31,
                                                                                        1998                  1997
                                                                                  -----------------     -----------------
<S>                                                                               <C>                   <C>               
Cash flows from Operating Activities                                              $          (1,712)    $         (10,096)

Adjustments to reconcile net loss to cash used by
           operating activities

           Changes in assets and liabilities                                                      0                10,000
                                                                                  -----------------     -----------------

Net cash used by operating activities                                                        (1,712)                  (96)

Investing Activities
           Loans to related party and accrued interest                                            0               (38,128)
                                                                                  -----------------     -----------------

Net cash used by investing activities                                                             0               (38,128)
                                                                                  -----------------     -----------------

Decrease in cash                                                                             (1,712)              (38,224)

Cash - beginning of period                                                                   10,965               163,476
                                                                                  -----------------     -----------------

Cash - end of period                                                              $           9,253     $         125,252
                                                                                  =================     =================
</TABLE>


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<PAGE>



                   PERIPHERAL CONNECTIONS, INC. AND SUBSIDIARY
                          (A Development Stage Company)
                        Unaudited Pro Forma Balance Sheet


<TABLE>
<CAPTION>
                                                                            March 31, 1998
                                                                    Peripheral            Netking         Consolidated
                                                                ------------------  -----------------   -----------------
ASSETS
CURRENT ASSETS
<S>                                                             <C>                 <C>                 <C>              
           Cash                                                 $            9,253  $          25,849   $          35,102
           Accounts receivable                                                   0             14,918              14,918
           Inventory                                                             0            278,324             278,324
           Prepaid expenses                                                      0            207,268             207,268
                                                                ------------------  -----------------   -----------------

                                          Total Current Assets               9,253            526,359             535,612

           Equipment and software                                                0          2,352,588           2,352,588
           Licenses and brand names                                              0          4,374,804           4,374,804
                                                                ------------------  -----------------   -----------------
                                                                                 0          6,727,392           6,727,392
                                                                ------------------  -----------------   -----------------

                                                  TOTAL ASSETS  $            9,253  $       7,253,751   $       7,263,004
                                                                ==================  =================   =================

LIABILITIES & EQUITY (DEFICIT)

CURRENT LIABILITIES
           Accounts payable                                     $                0  $          41,147   $          41,147
           Accrued expenses                                                      0             88,230              88,230
                                                                ------------------  -----------------   -----------------

                                     Total Current Liabilities                   0            129,377             129,377

           Loans payable                                                         0          7,266,000           7,266,000
                                                                ------------------  -----------------   -----------------

                                             Total Liabilities                   0          7,395,377           7,395,377

STOCKHOLDERS' EQUITY (DEFICIT)

           Common Stock $0.001 par value
           Authorized - 25,000,000 shares
           Issued and outstanding 3,850,000 shares                           3,850                  0              13,850*
           Additional paid-in capital                                      282,150                  0             272,150
           Deficit accumulated during the
              development stage                                           (276,747)          (141,626)           (418,373)
                                                                ------------------  -----------------   -----------------

                          Total Stockholders' Equity (Deficit)               9,253           (141,626)           (132,373)
                                                                ------------------  -----------------   -----------------

                                         TOTAL LIABILITIES AND
                                          STOCKHOLDERS' EQUITY  $            9,253  $       7,253,751   $       7,263,004
                                                                ==================  =================   =================
</TABLE>

              * 10,000,000 shares were issued for subsidiary.

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<PAGE>



                   PERIPHERAL CONNECTIONS, INC. AND SUBSIDIARY
                          (A Development Stage Company)
                   Unaudited Pro Forma Statement of Operations
                        Three months ended March 31, 1998



<TABLE>
<CAPTION>
                                                                    Peripheral            Netking         Consolidated
                                                                ------------------  -----------------   -----------------
<S>                                                             <C>                 <C>                 <C>              
Sales                                                           $                0  $          14,656   $          14,656
Cost of sales                                                                    0             20,075              20,075
                                                                ------------------  -----------------   -----------------

                                                    Gross Loss                   0             (5,419)             (5,419)

Interest income                                                                105                  0                 105
Expenses
           General and administrative                                        1,817            136,207             138,024
                                                                ------------------  -----------------   -----------------
                                                                             1,817            136,207             138,024

Net Loss for Period                                                         (1,712)          (141,626)           (143,338)

Deficit - beginning of Period                                             (275,035)                 0            (275,035)
                                                                ------------------  -----------------   -----------------

Deficit - end of Period                                                   (276,747)          (141,626)           (418,373)

Net Loss per Share                                                             .00                .00                (.01)

Average shares outstanding used to
           calculate net loss per share                                  3,850,000                N/A          13,850,000
</TABLE>


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<PAGE>



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

         The  Company  has no  operational  history  and  has yet to  engage  in
business of any kind. All risks inherent in a new and  inexperienced  enterprise
are  inherent in the  Company's  business.  The Company  intends to continue the
operations of a subsidiary which was acquired on April 9, 1998.

         On April 9, 1998, the Company beneficially acquired all of the stock of
Netking  Limited,  an English  private limited  company  ("Netking")  from Tomas
George Wilmot  ("Seller"),  who beneficially  owned all of the stock of Netking.
The title holders of Netking were Local Protectors  Limited and SNH Cooper,  who
held the  shares  as  nominees  for  Seller.  The  purchase  price  paid for the
purchased  stock was  10,000,000  newly issued shares of the common stock of the
Company,  which is  approximately  68.5% of all of the outstanding  stock of the
Company after such  issuance.  Tomas George Wilmot,  individually,  is the title
holder of all of the 10,000,000 newly issued shares of the Company. There are no
arrangements or understandings  among members of both the former and new control
person or their  associates  with  respect to  election  of  directors  or other
matters.

         On April 9, 1998, the Company beneficially acquired all of the stock of
Netking from Seller, who beneficially  owned all of the stock of Netking.  There
are two  shares  of  Netking  outstanding.  Because  English  law  requires  two
shareholders,  the Company  holds title to one share of stock of Netking and the
Company and Tomas Wilmot, as nominee for the Company,  jointly hold title to the
other share.  Netking is the beneficial  owner of Skynet 2001 Limited  (formerly
Keymore  Limited),  an English private limited company  ("Skynet").  Skynet owns
intellectual  property  pertaining to all aspects of the Skynet 2000  in-vehicle
system.  The Skynet 2000  system uses  communications  and  security  technology
coupled with proprietary software that provides in- vehicle protection, security
and information  services using mobile cellular  telecommunications.  The Skynet
2000 system provides 24 hour monitoring of vehicle  security,  personal distress
alarm,  and impact sensor and information  services,  as well as normal cellular
telephone  capability.  The  purchase  price  paid for the  purchased  stock was
10,000,000  shares  of  newly  issued  common  stock  of the  Company,  which is
approximately  68.5% of all of the  outstanding  stock of the Company after such
issuance.  The consideration was determined by arm's length negotiations between
the  Company  and  Seller.  Prior  to the  acquisition,  there  was no  material
relationship  between the Seller and the Company or any of its  affiliates,  any
director or officer of the Company,  or any  associate  of any such  director or
officer.

         A portion of the business of Skynet and Netking acquired by the Company
constitutes  equipment  and  other  physical  property  previously  used  in the
business of the Seller.  The Company  intends to continue to use such  equipment
and physical property for the same purposes.

         The discussions below highlight certain of the more material changes in
results of  operations  and changes in financial  condition for the fiscal three
month period ended March 31, 1998.

Results of Operations.

         During the first quarters of fiscal 1998 the Company incurred  expenses
related to general expense and accounting assistance.

Financial Condition.

         There were no significant changes to the net financial condition of the
Company in the three month period ended March 31, 1998. Cash decreased by $1,712
mainly as a result of administration  expense.  The Company continues to believe
it has the support of its major  stockholders and that financing is available to
meet all requirements.


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<PAGE>




PART II

                                Other Information

Item 1.           Legal proceedings:                  None

Item 2.           Changes in Securities:              None

Item 3.           Defaults Upon Senior
                  Securities:                         None

Item 4.           Submission of Matters to
                  a Vote of Security Holders:         None

Item 5.           Other Information:                  None

Item 6.           Exhibits and Reports on Form 8-K

                  (a)  Exhibits:            None
                  (b)  Reports on Form 8-K
                          A report on Form 8-K was filed on April 21, 1998 which
                          disclosed  the  items  discussed  in Item 2 about  the
                          acquisition  of assets and  announced  the election of
                          Tomas G. Wilmot as President.





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<PAGE>



                                   SIGNATURES

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



                                            PERIPHERAL CONNECTIONS, INC.


Dated: May 13, 1998                          /s/ Tomas George Wilmot
                                            Tomas George Wilmot, President



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