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, 1997

                                       OR

[ ]  TRANSITION REPORT UNDER SECTION 13 OF 15(d) OF THE EXCHANGE ACT OF 1934

          From the transition period from ____________ to ___________.


                       Commission File Number 33-55254-40


                              COMPU-GRAPHICS, LTD.
        -----------------------------------------------------------------
        (Exact name of small business issuer as specified in its charter)


           Nevada                                          87-0485311
-------------------------------                ---------------------------------
(State or other jurisdiction of                (IRS Employer Identification No.)
incorporation or organization)


                   440 Louisiana, Suite 475, Houston, TX 77002
                   -------------------------------------------
                    (Address of principal executive offices)

                                 (713) 547-8900
                           ---------------------------
                           (Issuer's telephone number)

                                       N/A
--------------------------------------------------------------------------------
(Former  name,  former  address and former  fiscal year,  if changed  since last
report)

     Indicate  by check  mark  whether  the  registrant  (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   
            ---  ---

        Class                 Shares Outstanding               Date
       -------                ------------------              ------
Common, $.001 par value            1,000,000                May 1, 1997
<PAGE>
                              COMPU-GRAPHICS, LTD.

                                      INDEX

                                                                       Page
                                                                      Number
                                                                      ------
PART I - FINANCIAL INFORMATION

     Item 1.Financial Statements

          Condensed Balance Sheets - March 31, 1997 and
          December 31, 1996 ..........................................   1

          Condensed  Statements of Operations - For the three
          months ended March 31, 1997 and 1996 and
          for the period from inception (July 26, 1990) to
          March 31, 1997..............................................   2

          Condensed Statements of Cash Flows - For the three months
          ended March 31, 1997 and 1996 and for the period from
          inception (July 26, 1990) to March 31, 1997.................   3

          Notes to Condensed Financial Statements.....................   4

     Item 2.Management's Discussion and Analysis of Financial
            Condition and Results of Operations.......................   5

PART II - OTHER INFORMATION...........................................   5

     Item 6.Exhibits and Reports on Form 8-K..........................   5

SIGNATURES............................................................   6
<PAGE>
                         PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

                              COMPU-GRAPHICS, LTD.
                          (A Development Stage Company)
                                 Balance Sheets

                                     Assets
<TABLE>
<CAPTION>

                                                              March 31,            December 31,
                                                                1997                  1996
                                                              --------             -----------
<S>                                                           <C>                   <C>
Current Assets
     Cash                                                     $      0              $      0
                                                              --------              --------
        Total Current Assets                                         0                     0
                                                              --------              --------
Total Assets                                                  $      0              $      0
                                                              ========              ========

                        Liabilities & Stockholder Equity

Current Liabilities
     Accounts Payable                                         $      0              $      0
                                                              --------              --------
     Total Current Liabilities                                $      0              $      0
                                                              --------              --------

Stockholders Equity
     Authorized shares 25,000,000
     $0.001 par value; 1,000,000
     outstanding at 3-31-97 and
     at 12-31-96                                                 1,000                1,000

     Deficit accumulated during
     development stage                                          (1,000)              (1,000)
                                                              --------              -------

Total Stockholders Equity                                     $      0              $     0
                                                              --------              -------

Total Liabilities & Stockholders Equity                       $      0              $     0
                                                              ========              =======
</TABLE>


                      See Notes to the Financial Statements


                                        1
<PAGE>
                              COMPU-GRAPHICS, LTD.
                          (A Development Stage Company)
                             Statement of Operations
                                   (Unaudited)

<TABLE>
<CAPTION>

                                                                            From
                                                                          Inception
                                          For the Three                (July 26, 1990)
                                          Months Ended                    Through
                                            March 31,                     March 31,
                                  --------------------------             ----------
                                  1997            1996                     1997
                                  ----------      ----------             ----------
<S>                              <C>             <C>                     <C>
REVENUES                         $         0     $         0             $         0
                                 -----------     -----------             -----------
EXPENSES
     Administration Expenses               0               0                   1,000
                                 -----------     -----------             -----------
         Total Expenses                    0               0                   1,000

NET (LOSS)                       $        (0)    $        (0)            $    (1,000)
                                 ===========     ===========             ===========
(LOSS) PER SHARE                 $      (.00)    $      (.00)            $      (.01)
                                 ===========     ===========             ===========
AVERAGE SHARES
OUTSTANDING                        1,000,000       1,000,000               1,000,000
                                 ===========     ===========             ===========
</TABLE>



                                       See Notes to the Financial Statements


                                                         2
<PAGE>
                              COMPU-GRAPHICS, LTD.
                          (A Development Stage Company)
                            Statements of Cash Flows

<TABLE>
<CAPTION>

                                          For the Three Months Ended    From Inception (July 26, 1990)
                                                  March 31,                      to March 31
                                          ------------------------      -----------------------------
                                          1997           1996                       1997
                                          ----           ----                       ----
<S>                                       <C>            <C>                <C>

CASH FLOWS FROM FINANCING
ACTIVITIES
Net Income (Loss)                         $     (0)   $    (0)              $  (1,000)
Adjustments to reconcile net loss
to cash used in operating
activities:                                      0          0                       0
                                          --------    -------               ---------

Net Cash Used By Operating
Activities                                $     (0)   $     0               $  (1,000)

CASH FLOWS FROM FINANCING
ACTIVITIES
Proceeds from issuance of
common stock                                     0          0                  1,000
                                          --------    -------               --------

Net cash provided from financing 
activities                                $      0    $     0                      0
                                          --------    -------              ---------

Net Increase (Decrease) in Cash           $      0    $     0              $       0

Cash at Beginning of Period                      0          0                      0
                                          --------    -------              ---------

Cash at End of Period                     $      0    $     0              $       0
                                          ========    =======              =========
</TABLE>


                                       See Notes to the Financial Statements


                                                         3

<PAGE>
                              COMPU-GRAPHICS, LTD.
                          (A Development Stage Company)
                   Notes to the Condensed Financial Statements
                                  March 31, 1997


1.       General

         The  interim   financial   statements  are  prepared  pursuant  to  the
requirements  for reporting on Form 10-QSB.  The December 31, 1996 balance sheet
data was derived  from  audited  financial  statements  but does not include all
disclosures  required by generally accepted accounting  principles.  The interim
financial  statements and notes thereto  should be read in conjunction  with the
financial  statements  and notes  included in the Company's  Form 10-KSB for the
year ended  December  31,  1996.  In the  opinion  of  management,  the  interim
financial  statements  reflect  all  adjustments  of a normal  recurring  nature
necessary for a fair statement of the results for the interim periods presented.






                                        4


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

Material Changes in Result of Operations

     During the three months  ended March 31, 1997 and 1996,  the Company had no
operations  other than the  search  for a  business  to acquire or with which to
combine.

     The Company  reported  no revenues or expenses for the  three month periods
ended   March 31, 1997 or 1996  nor  did the  Company incurred  any expenses for
either period.

Material Changes in Financial Condition, Liquidity and Capital Resources

     At March 31,  1997   the  Company  had   no  current assets and  no current
liabilities  as  compared  to no current assets and  no current  liabilities  at
December 31, 1996.

     Although   the  Company has  no liquidity, it believes that it will be able
to find a suitable Company with which to merge.



                           PART II - OTHER INFORMATION


ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

          a)   Exhibits
               27.1 Financial Data Schedule
          b)   Reports on Form 8-K
               None








                                        5

<PAGE>
                                   SIGNATURES

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


                                        COMPU-GRAPHICS, LTD.



Date: November 21, 1997                   By: /s/ Craig Barton
                                          -------------------------------------
                                          Craig Barton, President
                                          Principal Executive Officer and
                                          Principal Financial Officer



Date: November 21, 1997                   By: /s/ Hank Vanderkam
                                          -------------------------------------
                                          Hank Vanderkam, Treasurer
                                          Principal Financial Officer

                                       6