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 June 30, 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

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 June 30, 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

                                  June 30, 1998
                                      INDEX

PART I - FINANCIAL INFORMATION                                         Page No.

         Item 1   Financial Statements

                   Balance Sheets as of
                   June 30, 1998 and December 31, 1997                        4

                   Statements of Operations for the
                   six month periods ended
                   June 30, 1998 and 1997                                     5

                   Statements of Cash Flows for the
                   six month periods ended
                   June 30, 1998 and 1997.                                    6

         Item 2   Management's Discussion and Analysis
                           and Plan of Operations                             7

PART II - OTHER INFORMATION

         Item 1   Legal Proceedings                                           8
         ------

         Item 2   Changes in Securities                                       8
         ------

         Item 3   Defaults Upon Senior Securities                             8
         ------

         Item 4   Submission of Matters to a Vote of
                           Security Holders                                   8

         Item 5   Other Information                                           8
         ------

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






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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 June 30, 1998,  the results of operations  for the
six month periods  ended June 30, 1998 and 1997,  and the cash flows for the six
month periods ended June 30, 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.

         The statement of operations  includes the activities of NetKing Limited
for all of 1998.  NetKing  Limited was acquired as a wholly-owned  subsidiary on
April 9, 1998.


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<PAGE>



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


<TABLE>
<CAPTION>
                                                                              June 30,              Dec. 31,
                                                                                1998                  1997
                                                                             (Unaudited)            (Audited)
                                                                         -----------------     -----------------
ASSETS
CURRENT ASSETS
<S>                                                                      <C>                   <C>              
   Cash (overdraft)                                                      $         (25,698)    $          10,965
   Accounts receivable                                                              52,314                     0
   Inventory                                                                       273,299                     0
   Prepaid expenses                                                                 34,629                     0
                                                                         -----------------     -----------------

                                                 Total Current Assets              334,544                10,965

OTHER ASSETS
   Equipment and software                                                        2,287,461                     0
   Licenses and brand names                                                      4,291,958                     0
                                                                         -----------------     -----------------
                                                                                 6,579,419                     0
                                                                         -----------------     -----------------

                                                         TOTAL ASSETS    $       6,913,963     $          10,965
                                                                         =================     =================

LIABILITIES & EQUITY (DEFICIT)

CURRENT LIABILITIES
   Accounts payable                                                      $         121,643     $               0
   Accrued expenses                                                                125,487                     0
   Loans payable                                                                   129,804                     0
                                                                         -----------------     -----------------

                                            Total Current Liabilities              376,934                     0
Loans payable                                                                    7,266,000                     0
                                                                         -----------------     -----------------

                                                    Total Liabilities            7,642,934                     0

STOCKHOLDERS' EQUITY (DEFICIT)

   Common Stock $0.001 par value
   Authorized - 25,000,000 shares
   Issued and outstanding 14,600,000 shares                                         14,600                 3,850
   Additional paid-in capital                                                      421,403               282,150
   Deficit accumulated during the development stage                             (1,159,234)             (275,035)
   Foreign currency adjustment                                                      (5,740)                    0
                                                                         -----------------     -----------------

                                 Total Stockholders' Equity (Deficit)             (728,971)               10,965
                                                                         -----------------     -----------------

                                                TOTAL LIABILITIES AND
                                                 STOCKHOLDERS' EQUITY    $       6,913,963     $          10,965
                                                                         =================     =================
</TABLE>



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<PAGE>



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

<TABLE>
<CAPTION>
                                                              For the                          For the
                                                        Three Months Ended                Six Months Ended
                                                             June 30,                         June 30,
                                                        1998           1997             1998            1997
                                                   -------------  --------------    -------------  -------------
<S>                                                <C>            <C>               <C>            <C>          
Sales                                              $      49,875  $            0    $      64,531  $           0
Cost of sales                                             60,026               0           80,101              0
                                                   -------------  --------------    -------------  -------------
                                     GROSS LOSS          (10,151)              0          (15,570)             0

Interest income                                               69               0              174              0

Expenses
   Administrative                                        421,511           2,788          504,700         10,553
   Depreciation                                          159,268               0          214,103              0
   Net Interest Expense                                        0           2,340                0          4,671
                                                   -------------  --------------    -------------  -------------
                                                         580,779           5,128          718,803         15,224
                                                   -------------  --------------    -------------  -------------

Net loss before other                                   (590,861)         (5,128)        (734,199)       (15,224)

Finder's fee related to subsidiary
   acquisition                                          (150,000)              0         (150,000)             0
                                                   -------------  --------------    -------------  -------------

Net Loss for Period                                     (740,861)       (5,128)          (884,199)       (15,224)

Deficit - beginning of Period                           (418,373)        (22,868)        (275,035)       (12,772)
                                                   -------------  --------------    -------------  -------------

Deficit - end of Period                               (1,159,234)        (27,996)      (1,159,234)       (27,996)

Net Loss per Share                                          (.05)           (.01)            (.10)          (.03)

Average shares outstanding used to
   calculate net loss per share                       14,600,000       1,000,000        9,225,000      1,000,000
</TABLE>


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<PAGE>



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


<TABLE>
<CAPTION>
                                                                                          For the
                                                                                     Six Months Ended
                                                                                         June 30,
                                                                                1998                  1997
                                                                         -----------------     -----------------
<S>                                                                      <C>                   <C>               
Cash flows from Operating Activities                                     $        (884,199)    $         (15,224)

Adjustments to reconcile net loss to cash used by operating activities:
     Foreign currency adjustment                                                    (5,740)                    0
     Depreciation                                                                  214,103                     0
     Stock issued for expenses                                                     150,000                     0

Changes in assets and liabilities:
     Accounts receivable                                                           (52,314)                    0
     Inventory                                                                      29,102                     0
     Prepaid expenses                                                              (34,629)                    0
     Accounts payable and accrued expenses                                         247,132                11,500
                                                                         -----------------     -----------------

Net cash used by operating activities                                             (336,545)               (3,724)

Investing Activities
   Loans to related party and accrued interest                                           0               (39,870)
   Purchase of fixed assets                                                       (375,922)                    0
                                                                         -----------------     -----------------

Net cash used by investing activities                                             (375,922)              (39,870)

Financing Activities
   Loan proceeds                                                                   675,804                     0
                                                                         -----------------     -----------------

Net cash provided by financing activities                                          675,804                     0
                                                                         -----------------     -----------------

Decrease in cash                                                                   (36,663)              (43,594)

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

Cash - end of period                                                     $         (25,698)    $         119,882
                                                                         =================     =================
</TABLE>

SUPPLEMENTAL  INFORMATION
During the six months ended June 30, 1998, the Company issued  10,000,000 shares
of Regulation S stock to acquire a subsidiary.  The Company also issued  750,000
shares of Regulation S stock as a finder's fee valued at $150,000. The Company's
subsidiary  acquired  assets of $6,720,000  during the period by incurring loans
payable in the same amount.



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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 other than through its subsidiary.  All risks inherent in a
new and  inexperienced  enterprise are inherent in the Company's  business.  The
Company is continuing 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 six
month period ended June 30, 1998.

Results of Operations.

         During  the first two  quarters  of fiscal  1998 the  Company  incurred
expenses  related to general expense as well as normal operating  expenses.  The
Company had a loss from  operations of $734,199 and a finder's fee in the amount
of  $150,000.  The  finder's fee was paid with  Regulation S stock,  which was
later registered on Form S-8 which was filed on May 12, 1998.

Financial Condition.

         There were no significant changes to the net financial condition of the
Company in the six month period ended June 30, 1998.  Cash  decreased by $25,698
mainly as a result of operating

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<PAGE>



expenses.  The  Company  continues  to believe  it has the  support of its major
stockholders and that financing is available to meet all requirements.

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.


                                   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: 7 August 1998
                                   Tomas George Wilmot, President



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