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 September 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 September 30, 1998.

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


                                        1

<PAGE>



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

                               September 30, 1998
                                      INDEX

PART I - FINANCIAL INFORMATION                                         Page No.

         Item 1   Financial Statements

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

              Statements of Operations for the
              nine month periods ended
              September 30, 1998 and 1997                                 5

              Statements of Cash Flows for the
              nine month periods ended
              September 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                                       9
         ------

         Item 2   Changes in Securities                                   9
         ------

         Item 3   Defaults Upon Senior Securities                         9
         ------

         Item 4   Submission of Matters to a Vote of
                           Security Holders                               9

         Item 5   Other Information                                       9
         ------

         Item 6   Exhibits and Reports on Form 8-K                        9
         ------






                                        2

<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 September 30, 1998,  the results of operations for
the nine month periods ended September 30, 1998 and 1997, and the cash flows for
the nine month periods ended September 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.  NetKing is continuing the  operations of Skynet 2001 Limited,  a
subsidiary of NetKing which was acquired on February 27, 1998.

         The balance sheet includes the assets of Skynet Satellite Communication
Corporation  ("SSCC")  which was acquired as a subsidiary  on June 5, 1998.  The
transaction  has been recorded as a purchase  transaction.  The Company also has
another  subsidiary,  Peripheral Canada, Inc. which was formed to assist SSCC in
its Canadian operations.



                                        3

<PAGE>



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


<TABLE>
<CAPTION>
                                                                            September 30,      Dec. 31,
                                                                                1998                  1997
                                                                             (Unaudited)            (Audited)   
                                                                         -----------------     -----------------
ASSETS
CURRENT ASSETS
<S>                                                                      <C>                   <C>              
   Cash (overdraft)                                                      $         (99,932)    $          10,965
   Accounts receivable                                                              41,845                     0
   Inventory                                                                         1,710                     0
   Prepaid expenses                                                                 70,917                     0
                                                                         -----------------     -----------------

                                                 Total Current Assets               14,540                10,965

OTHER ASSETS
   Equipment                                                                        65,285                     0
   Licenses and brand names                                                      7,036,583                     0
                                                                         -----------------     -----------------
                                                                                 7,101,868                     0
                                                                         -----------------     -----------------

                                                         TOTAL ASSETS    $       7,116,408     $          10,965
                                                                         =================     =================

LIABILITIES & EQUITY (DEFICIT)

CURRENT LIABILITIES
   Accounts payable                                                      $         178,678     $               0
   Accrued expenses                                                                302,809                     0
   Loans payable                                                                   326,507                     0
                                                                         -----------------     -----------------
                                            Total Current Liabilities              807,994                     0

Loans payable*                                                                   7,305,805                     0
Payable for subsidiary**                                                           424,063                     0
                                                                         -----------------     -----------------
                                                                                 7,729,868                     0
                                                                         -----------------     -----------------
                                                    Total Liabilities            8,537,862                     0

STOCKHOLDERS' EQUITY (DEFICIT)

   Common Stock $0.001 par value
   Authorized - 25,000,000 shares
   Issued and outstanding 14,600,000 shares
    (3,850,000 in 1997)                                                             14,600                 3,850
   Additional paid-in capital                                                      423,594               282,150
   Deficit accumulated during the development stage                             (1,839,910)             (275,035)
   Foreign currency adjustment                                                     (19,738)                    0
                                                                         -----------------     -----------------

                                 Total Stockholders' Equity (Deficit)           (1,421,454)               10,965
                                                                         -----------------     -----------------

                                                TOTAL LIABILITIES AND
                                                 STOCKHOLDERS' EQUITY    $       7,116,408     $          10,965
                                                                         =================     =================
</TABLE>

*Company is in  processing  of  issuing  5,000,000  shares  of stock  to  retire
 $6,680,000 of this.

**This liability  will be satisfied by issuing  500,000  shares of  Regulation S
  stock on December 31, 1999, 2000, and 2001. (1,500,000 shares total)

                                        4

<PAGE>



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

<TABLE>
<CAPTION>
                                                              For the                          For the
                                                        Three Months Ended                Nine Months Ended
                                                           September 30,                    September 30,
                                                        1998           1997             1998            1997    
                                                   -------------  --------------    -------------  -------------
<S>                                                <C>            <C>               <C>            <C>          
Sales                                              $      56,950  $            0    $     121,481  $           0
Cost of sales                                             27,035               0          107,136              0
                                                   -------------  --------------    -------------  -------------
                                   GROSS PROFIT           29,915               0           14,345              0

Interest income                                                0               0              174              0

Expenses
   Administrative                                        522,853          81,652        1,027,553         92,205
   Depreciation and amortization                         187,738               0          401,841              0
   Net Interest Expense                                        0          11,526                0         16,197
                                                   -------------  --------------    -------------  -------------
                                                         710,591          93,178        1,429,394        108,402
                                                   -------------  --------------    -------------  -------------

Net loss before other                                   (680,676)        (93,178)      (1,414,875)      (108,402)

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

Net Loss for Period                                     (680,676)        (93,178)      (1,564,875)      (108,402)

Deficit - beginning of Period                         (1,159,234)        (27,996)        (275,035)       (12,772)
                                                   -------------  --------------    -------------  -------------

Deficit - end of Period                               (1,839,910)       (121,174)      (1,839,910)      (121,174)

Net Loss per Share                                          (.05)           (.09)            (.14)          (.11)

Average shares outstanding used to
   calculate net loss per share                       14,600,000       1,033,889       11,016,667      1,011,172
</TABLE>


                                        5

<PAGE>



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

<TABLE>
<CAPTION>
                                                                                          For the
                                                                                     Nine Months Ended
                                                                                       September 30,
                                                                                1998                  1997      
                                                                         -----------------     -----------------
<S>                                                                      <C>                   <C>               
Cash flows from Operating Activities                                     $      (1,564,875)    $        (108,402)

Adjustments to reconcile net loss to cash used by operating activities:
     Foreign currency adjustment                                                   (19,738)                    0
     Depreciation                                                                  401,841                     0
     Stock issued for expenses                                                     150,000               105,000

Changes in assets and liabilities:
     Accounts receivable                                                           (41,845)                    0
     Inventory                                                                      (1,710)                    0
     Prepaid expenses                                                              (70,917)                    0
     Accounts payable and accrued expenses                                         476,722                 1,519
                                                                         -----------------     -----------------

Net cash used by operating activities                                             (670,522)               (1,883)

Investing Activities
   Loans to related party and accrued interest                                           0              (143,332)
   Purchase of fixed assets                                                       (355,326)                    0
                                                                         -----------------     -----------------

Net cash used by investing activities                                             (355,326)             (143,332)

Financing Activities
   Stock and paid-in capital from subsidiary                                         2,194                     0
   Cash from subsidiary                                                                445                     0
   Loan proceeds                                                                 1,261,609                     0
   Loan repayments                                                                (349,297)                    0
                                                                         -----------------     -----------------

Net cash provided by financing activities                                          914,951                     0
                                                                         -----------------     -----------------

Decrease in cash                                                                  (110,897)             (145,215)

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

Cash - end of period                                                     $         (99,932)    $          18,261
                                                                         =================     =================
</TABLE>

SUPPLEMENTAL INFORMATION
   During  the  nine  months  ended  September  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.

   The  Company  purchased  a  subsidiary  (SSCC) with net assets of $424,063 by
   incurring a liability in the same amount.  The liability will be satisfied by
   issuing  500,000  shares of the Company's  Regulation S stock on December 31,
   1999, 2000, and 2001. (1,500,000 shares total)

   The  Company  will pay to the former  owners of SSCC 10% of the  consolidated
   gross  sales  made in Canada  and Hong Kong and 1% of the  gross  U.S.  sales
   related to SSCC's  product from the closing  date  through  December 31, 1999
   with payments due within 30 days of December 31, 1999.  For sales in the year
   2000,  the  percent  is 6 2/3% for sales in Canada  and Hong Kong and .66% of
   sales in the U.S. For sales in the year 2001, the percent is 3 1/3% for sales
   in Canada and Hong Kong and .33% of sales in the U.S.

                                        6

<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 subsidiaries.  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 and a subsidiary acquired in June 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.

         During June, the Company purchased a subsidiary,  SSCC. The transaction
has been treated as a purchase.  SSCC had a loss from operations for 1998 in the
amount of $6,794 and a loss from inception of $37,587.  All losses occured prior
to the purchase.  SSCC has licensing rights to security tracking boxes for motor
vehicles in Canada and Hong Kong.

         AMP Inc., a New York Stock  Exchange  listed  company,  and the Company
have signed a letter of intent (Aug.  12,  1998) to effect a strategic  alliance
between  Skynet 2001 Ltd. (a  subsidiary  of the Company) and AMP  involving the
Skynet  2001  satellite  navigation  system  used  for  in-car   communications,
information,  vehicle anti-theft  security,  vehicle locating and recovery,  and
personal protection.

         Skynet's  existing  proprietary  software  couples GSM  (cellular)  GPS
(Global  Positioning  System),  SMS  (short  message  service)  and  a  remotely
activated immobilising system. In combination these technologies uniquely `wrap'
a vehicle in an invisible net of radio, electrical,

                                        7

<PAGE>



electronic,  mechanical,  ultrasonic,  telematics,  and ever watching  satellite
protection that spans national boundaries and continents.

         AMP's vast research,  development and  manufacturing  capability in the
diversity   of   areas   combined   with   its   leadership   position   in  the
electrical/electronic  interconnections markets puts the Alliance at the cutting
edge of advanced technologies in this field.

         Skynet/AMP  will add  satellite  and mobile  technologies  to a vehicle
manufacturer  fitted security system and then permanently watch over it 24 hours
a day 365 days per year.

         New developments include: Hands-free vehicle driver interface, Internet
access,  Sophisticated  mapping,  Improved car security,  and Medical alerts for
accident victims.

         Several vehicle producers are exploring on-board electronic diagnostics
that can be  remotely  interrogated  by  telematics.  This would  enhance  their
response  to the new EU  Environmental  Directive  demanding  a standard  engine
management  exhaust  efficiency  diagnosis  point in all new cars sold in Europe
from January 2000.

         AMP  advanced  technology  is being  considered  because in addition to
providing satellite tracking with remote activation of a vehicle's security,  it
will -

o        Permanently  monitor  all,  or  any,  of  a  vehicle's  electronic  and
         electrical  systems including  potential causes of excess emissions and
         even mechanical  component  failure.  If a fault occurs the 'green box'
         can report it automatically to a central computer.

     The computer will download on request to  manufacturers or their dealers so
that  quickly car owners can be  identified  and told:  'Your  vehicle  requires
essential attention. Do not ignore a warning dashboard light.'

         The AMP system, designed to last the life of the vehicle will: -

o        Enable a manufacturer  to remotely  interrogate  any number of its cars
         and receive a computer  printout  identifying  individual  vehicles and
         their faults.

o        Enable interrogation of future developments entering vehicle design and
         enhance  generic  systems with a potential to rectify  problems as they
         occur.

o        Enable  some  electronic   faults  to  be  corrected   remotely,   like
         re-programming an engine management system while the car driver sleeps.

         Skynet  2001's Sk>AMP  technology  is the 'key' because its  telematics
link logically to AMP's advanced new trend setting year 2000 vehicle  electrical
and electronic systems.

         Under the Alliance  Slough based AMP Services Ltd Europe,  Middle East,
Africa will produce Sk>AMP technology to meet vehicle makers' original equipment
requirements and to supply existing vehicles through Skynet 2001.

         Skynet  2001  is  to  market  Sk>AMP  worldwide   starting  in  Britain
immediately.  And the Alliance is to develop its unique  system to protection in
other areas,  including hospital,  farming, and industrial equipment,  sheep and
cattle  round-ups,  skiing,  climbing,  'tagging'  prisoners / enforcing  curfew
orders, and child safety-security.

         The discussions below highlight certain of the more material changes in
results of  operations  and changes in financial  condition  for the fiscal nine
month period ended September 30, 1998.


                                        8

<PAGE>



Results of Operations.

         During the first three  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 $1,414,875.  A finder's fee in the amount
of $150,000 in connection  with the acquisition of Netking Limited 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 nine month period ended  September  30, 1998.  Cash  decreased by
$110,897  mainly as a result of  operating  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
                           None


                                   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: November 20, 1998             
                                    -------------------------------
                                    Tomas George Wilmot, President



                                        9