U.S.
SECURITIES AND EXCHANGE COMMISSION


Washington,
D. C. 20549





Form
10Q





(Mark
One)





X           Quarterly
report under section 13 or 15(d) of the Securities Exchange Act of
1934





For the
quarterly period ended March 31, 2008





Transition report under section 13 or 15(d) of the Securities Exchange Act of
1934


for the
transition period from____________________ to
______________________.








Commission
File No: 0-23873








OVALE GROUP,
INC.


(Exact
Name of Registrant as specified in its charter)








New Jersey
            22-1637978(State
      or other jurisdiction
            (IRS
      Employer Id. No.)of
      incorporation)





14 Front St., Suite
200, Hempstead, NY 11550





(Address
of Principal Executive Office including Zip Code)





Registrant’s
telephone Number: (516)
220-1229








Indicate
by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 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





Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act.





Large
accelerated filer
­­­___                                                                                                                     Accelerated
filer  ___





Non-accelerated
filer (Do not check if a smaller reporting
company)  ___                                                                                                                                Smaller
reporting company X





Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act). Yes     No X





State the
number of shares outstanding of each of the issuer's classes of common equity,
as of the latest practicable date:  Common Stock, no par value
16,086,532 shares at March 31, 2008.







OVALE
GROUP, INC.
 FORM10-Q
- QUARTER ENDED MARCH 31, 2008
 INDEX
 
 
 PART
      IPart I. Financial
    Information
  Item 1.
              Financial
      StatementsCondensed
      Consolidated Balance Sheet- March 31, 2008 (unaudited) and December 31,
      2007
              1Condensed
      Consolidated Statements of Operations, for the Three Months
      Ended
                March
      31, 2008 and March 31, 2007  (unaudited)
              2Condensed
      Consolidated Statements of Cash Flows, for the Three Months
      Ended
                March
      31, 2008 and  March 31, 2007 (unaudited)
              3Notes
      to the Condensed Consolidated Financial Statements
    (unaudited)
              4Item
      2
              Management’s Discussion and Analysis of Financial
      Condition and Results of Operations
              15Item
      3.
              Quantitative and Qualitative Disclosure of Market
      Risk
              21Item
      4.
              Controls and Procedures
              28
      PART
      II OTHER INFORMATION
              23Item
      1A. Risk Factors
              23Item
      6. Exhibits and Reports on Form 8-K24SIGNATURESCERTIFICATIONSEXHIBITS


PART I -
FINANCIAL INFORMATION





ITEM
1. FINANCIAL STATEMENTS


OVALE
      GROUP. INC.CONDENSED
      CONSOLIDATED BALANCE SHEETS





March
      31, 2008
            
            
            December
      31, 2007(Unaudited)
            
            
            (Audited)ASSETSCurrent
      assetsCash
      and cash equivalents
            
            $
            120,927
            
            
            $
            309,827Accounts
      receivable
            
            
            56,924
            
            
            
            82,773Other
      receivables
            
            
            185,288
            
            
            
            164,795Merchandise
      inventory
            
            
            1,063,054
            
            
            
            798,540Prepaid
      expenses
            
            
            72,711
            
            
            
            39,607Total
      current assets
            
            
            1,498,904
            
            
            
            1,395,542Property,
      plant, and equipment, net
            
            
            968,221
            
            
            
            947,126Deposits
            
            
            139,878
            
            
            
            135,523Leasehold
      premium and key money
            
            
            1,172,860
            
            
            
            1,238,809Total
      assets
            
            $
            3,779,863
            
            
            $
            3,717,000LIABILITIES
      AND SHAREHOLDERS DEFICITCurrent
      liabilitiesBank
      line of credit
            
            $
            1,479,293
            
            
            $
            1,317,812Accounts
      payable and accrued expenses
            
            
            634,138
            
            
            
            898,074Loans
      and interest payable
            
            
            116,300
            
            
            
            100,300Loan
      from shareholder
            
            
            6,759,495
            
            
            
            5,665,004Total
      current liabilities
            
            
            8,989,226
            
            
            
            7,981,190Shareholder's
      deficitCommon
      stock, no par value, 18,000,000 shares authorized
            
            
            1,207,193
            
            
            
            1,207,19310,071,532 issued and
      outstandingPreferred
      stock, 2,000,000 shares authorized none issuedAccumulated
      deficit
            
            
            (5,132,717
            )
            
            
            (4,842,475
            )Accumulated
      other comprehensive loss
            
            
            (1,283,839
            )
            
            
            (628,908
            )Total
      shareholders’ deficit
            
            
            (5,209,363
            )
            
            
            (4,264,190
            )Total
      liabilities and shareholders’ deficit
            
            $
            3,779,863
            
            
            $
            3,717,000


.








See
accompanying notes to unaudited condensed consolidated financial
statements.


1





OVALE
      GROUP. INC.CONDENSED
      CONSOLIDATED STATEMENTS OF
OPERATION


(Unaudited)


Three
      Months Ended March 31,2008
            
            
            2007Sales
            
            $
            486,261
            
            
            $
            324,925Cost
      of goods sold
            
            
            106,504
            
            
            
            151,352Gross
      profit
            
            
            379,757
            
            
            
            173,572Operating
      expenses:Salaries
            
            
            232,617
            
            
            
            176,318General
      Administrative
            
            
            386,964
            
            
            
            181,668Marketing
            
            
            149,907
            
            
            
            88,915Professional
      fees
            
            
            14,718
            
            
            
            18,432Total
      operating expenses
            
            
            784,206
            
            
            
            465,333Loss
      from operations
            
            
            (404,449
            )
            
            
            (291,761
            )Other
      income (expense)Interest
      income
            
            
            -
            
            
            
            -Interest
      expense
            
            
            (39,680
            )
            
            
            (17,186
            )Gain
      (loss) on foreign currency translation
            
            
            150,657
            
            
            
            (11,864
            )Other
            
            
            3,230
            
            
            
            9,319Total
      other income (expenses)
            
            
            114,207
            
            
            
            (19,731
            )Net
      Loss
            
            $
            (290,242
            )
            
            $
            (311,492
            )Basic
      and diluted loss per share
            
            $
            (0.03
            )
            
            $
            (0.05
            )Weighted
      average shares outstanding
            
            
            10,071,532
            
            
            
            5,900,000











COMPREHENSIVE
LOSS


(Unaudited)





March
      31, 2008
            
            
            March
      31, 2007Net
      income
            
            $
            (290,242
            )
            
            $
            (311,492
            )Loss
      on currency translation
            
            
            (654,931
            )
            
            
            (25,321
            )Comprehensive
      loss
            
            $
            (945,173
            )
            
            $
            (336,813
            )











See
accompanying notes to unaudited condensed consolidated financial
statements.





2





OVALE
      GROUP. INC.CONDENSED
      CONSOLIDATED STATEMENT OF CASH FLOWS
              (Unaudited)





Three
      Months Ended March 31,2008
            
            
            2007Cash
      flow from operating activitiesNet
      loss
            
            $
            (290,242
            )
            
            $
            (311,492
            )Adjustment
      to reconcile net loss to net cash provided (used) in operating
      activities:Depreciation
      and amortization
            
            
            273,256
            
            
            
            38,433Changes
      in operating assets and liabilities:Inventory
            
            
            (264,514
            )
            
            
            64,746Prepaid
      expenses
            
            
            (33,104
            )
            
            
            (10,587
            )Accounts
      receivable
            
            
            25,849
            
            
            
            14,017Other
      receivable
            
            
            (20,493
            )
            
            
            (2,171
            )Accounts
      payable
            
            
            (263,936
            )
            
            
            (16,255
            )Other
      liabilities
            
            
            3,000
            
            
            
            (160,152
            )Cash
      used in operating activities
            
            
            (570,184
            )
            
            
            (383,461
            )Cash
      Flow from Investing activitiesLeasehold
      improvement and equipment
            
            
            (117,762
            )
            
            
            (49,562
            )Deposits
            
            
            (4,355
            )
            
            
            (512
            )Cash
      provided (used) by investing activities
            
            
            (122,117
            )
            
            
            (50,074
            )Cash
      Flow from Financing ActivitiesBank
      line of credit
            
            
            161,481
            
            
            
            194,951Shareholders
      loan
            
            
            1,094,491
            
            
            
            449,415Cash
      provided (used) financing activities
            
            
            1,255,972
            
            
            
            644,402Effect
      of exchange rate on cash
            
            
            (752,571
            )
            
            
            (25,321
            )Net
      change in cash
            
            
            (188,900
            )
            
            
            185,546Cash
      and cash equivalent, beginning
            
            
            309,827
            
            
            
            152,795Cash
      and cash equivalents, end
            
            $
            120,927
            
            
            $
            338,341








See
accompanying notes to consolidated financial statements.


3


OVALE
GROUP, INC.


NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS


(Unaudited)








NOTE
1 – ORGANIZATION AND BUSINESS





Ovale
Group, Inc. (formerly known as Orion Diversified Technologies, Inc.) is the
consolidated parent of three European subsidiaries engaged in the retail sale of
luxury gifts and apparel for infants.




Orion
Diversified Technologies, Inc. (Orion) was incorporated in New Jersey on May 6,
1959. Until 1986, Orion was engaged in the marketing and sale of a line of
semiconductors, transistors, diodes, rectifiers and other ancillary electronic
products.  Because of sustained operating losses, Orion discontinued
this line of operation and filed a plan of reorganization (under Chapter 11)
with the United States Bankruptcy Court for the Eastern District of New York, on
April 30, 1990. The Company’s Plan of Reorganization was confirmed by the United
States Bankruptcy Court for the Eastern District of New York on April 30, 1990
and consummated on June 2, 1992. After the reorganization, Orion’s management
limited its activities to seeking to consummate a business combination with a
privately owned company.




On June
2, 2003, Orion’s Board of Directors and the holders of a majority of the
outstanding shares of Orion’s Common Stock unanimously approved a share exchange
agreement between Ovale S.A. (Ovale) and all of its shareholders (2003
Agreement).  Ovale was incorporated in Geneva (Switzerland) on October
17, 2002 with its main office located at Boulevard Helvétique 36 - 1027 Geneva,
Switzerland.  The company was authorized and issued 100 shares of
Class A common stock, 1,000 CHF (i.e., Swiss Francs) par value, and 150 shares
of Class B common stock, 5,000 CHF par value. The Class A shares were given
Droit Superior which
means they have preference rights on liquidation.




Ovale’s
major activity is the design, manufacture, trade and direct sale of fashion
products focusing on infants.  Ovale plans to operate numerous high
end proprietary points of sales (POS) locations worldwide, starting in major
European cities. Ovale’s strategy is to quickly achieve critical
mass.  Corner shops may also be established in specialty stores and
contracts made with maternity hospitals and the like.




On
November 11, 2002, Vladimir Fabert, Gilles Neveu, Ghulamreza Shahbazi, Majid El
Sohl, and Atlantic International Capital Holdings, Ltd. became the Five Original
Ovale Investors when they invested an aggregate of CHF 50,000. They each
received Class A shares in proportion to their anticipated involvement in the
company. In June 2003 the same Five Original Ovale Investors also borrowed CHF
50,000 ($38,000) from Orion and invested in Ovale.




In April,
2003, Orion, through a private placement, generated gross proceeds of $306,202
and net proceeds of $281,688.  On May 23, 2003, Orion loaned $214,499
to Ovale to open its first store.  In July, 2003 an additional $38,080
was wired by Orion to Ovale. Mr. Fabert guaranteed repayment of this Advance to
Orion.




Mr.
Fabert, Ovale’s President and principal stockholder, contacted certain European
investors personally known to him and entered into arrangements with them to
provide funds to the new enterprise.  Mr. Fabert gave each investor
his personal promissory note which provided that the funds loaned would either
be returned or they would receive shares in a public company in the United
States.  Ovale has recorded these loans from Mr. Fabert.  On
September 6, 2003, through Mr. Fabert, investors invested CHF 750,000 ($570,000)
in Class B shares of Ovale.





On
September 15, 2004, Orion, and the holders of all of the outstanding capital
stock of Ovale, entered into an agreement that amended, restated and replaced
their 2003 Agreement (the “Share Exchange Agreement”).  Pursuant to
the Share Exchange Agreement, Ovale shareholders agreed to tender to Orion all
of the 100 issued and outstanding shares of Class A common stock, 1,000 CHF
(i.e., Swiss Francs) par value, and all 150 issued and outstanding shares of
Class B common stock, 5,000 CHF par value, of Ovale in exchange for an aggregate
of 10,608,100 shares of common stock of the Company. In addition, the Class A
shareholders of Ovale agreed to relinquish their  CHF 50,000
indebtedness to Orion as additional payment for their Class A shares and Mr.
Fabert, who had loaned €700,000 ($543,770) to Ovale agreed to accept 1,166,900
shares of Orion’s common stock for each Euro lent to Ovale.




4





On
November 8, 2004, Orion, Ovale and the shareholders of Ovale entered into an
amendment (the “Amendment”) to the Share Exchange Agreement. Pursuant to the
Amendment, the parties agreed to consummate the business combination in two
closings.  At the Initial closing, which took place on November 19,
2004, Orion delivered 5,900,000 shares of its common stock, to Frederic Cottier,
the designated Swiss escrow agent (Escrow Agent).  The escrow agent
delivered 1,166,900 shares to Fabert in exchange for the assignment of
Orion-Ovale loan to Orion and 2,063,559 shares to Ovale shareholders, in
proportion to their interests in Ovale.  Upon the delivery of Ovale’s
audited financial statements to Orion in November, 2005, the escrow agent
delivered 1,949,541 of the remaining shares to Vladimir Fabert and 720,000
shares to Alexandra Fabert, his wife.  The release of these shares was
recorded as addition to common stock and reduction in the additional paid in
capital of $26,695.  The shareholders of Ovale delivered all issued
and outstanding shares of Ovale to Ovale’s counsel until the second closing,
and  €443,894, held in trust in Switzerland, was released to Ovale for
use in its business. The Orion shares issued to Ovale shareholders were not
allowed to vote but were included in the weighted average number of shares
outstanding for purposes of calculating earnings per share. Finally, the
Amendment provided that the Company’s Board of Directors remain intact until the
second closing.




On
December 18, 2007, Orion held a meeting of its shareholders pursuant to its
final proxy statement which became effective on November 13, 2008.  At
that meeting the shareholders voted in favor of the Exchange Agreement and the
effective control of Orion was turned over to the shareholders of
Ovale.




At the
second closing to be held on April 3, 2008 (see Note 14), Orion delivered the
remaining 5,875,000 shares of its common stock, to individual Ovale shareholders
in exchange for all of the Ovale shares.  The shares were delivered to
the five Class A Ovale shareholders as follows: Vladimir Fabert 1,136,334;
Gilles Neveu, 2,800,000; Parthian (Gholamreza Shahbazi) 697,920; and Atlantic
International Capital Holdings Ltd. 620,373. The transaction with Ovale was
approved by two-thirds of Orion’s shareholders.




In
accordance with the approval of the shareholders, Orion filed an amendment to
its certificate of incorporation, on December 24, 2008, and changed its name to
Ovale Group, Inc., and increased its authorized shares to 20,000,000 shares, no
par value, of which 2,000,000 shares  is reserved for a class of
preferred stock.




Ovale SA
opened its first store in Geneva (Switzerland) on December 8, 2004 in a
fashionable section of the city. New stores are scheduled to be opened in major
cities on a regular basis (approximately one new store every nine
months).  The second store in Zurich, Switzerland, began operations in
November of 2006.




The
French subsidiary began operations in France on November 12, 2003 with a first
store on Boulevard St. Germain, a prestigious high fashion district of Paris.
The second store in Paris opened on June 5, 2006 on Rue Marbeuf, another
fashionable area of Paris.




The fifth
store was opened on December 12, 2007 on Sloane Street, in London, England,
comparable to Madison Ave. between 60th Street and 80th Street
in New York City.




NOTE
2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES




Basis of
Presentation





The
accompanying consolidated financial statements are unaudited, but include all
adjustments (consisting only of normal, recurring adjustments) which we consider
necessary for a fair presentation of our financial position at such dates and
the operating results and cash flows for those periods. Although we believe that
the disclosures in our financial statements are adequate to make the information
presented not misleading, certain information normally included in financial
statements prepared in accordance with accounting principles generally accepted
(“GAAP”) in the United States (the “U.S.”) has been condensed or omitted
pursuant to the rules and regulations of the Securities and Exchange Commission
(the “SEC”) for quarterly reporting.




5





The
information included in this Report should be read in conjunction with the
consolidated financial statements and accompanying notes included in our Annual
Report on Form 10-KSB for the year ended December 31, 2007 filed with the SEC on
May 15, 2008 and our Quarterly Reports on Form 10-QSB for the quarterly periods
ended March 31, 2007, June 30, 2007 and September 30, 2007.





Use of estimates in the
preparation of financial statements




The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenue and expenses during
the reporting period. Actual results could differ from those
estimates.




Principles of
consolidation




The
consolidated financial statements include the accounts of the Ovale S.A, Ovale
Limited, Ovale SARL and Ovale Group, Inc. (Formerly Orion Diversified
Technologies, Inc).  All significant intercompany transactions and
balances are eliminated in consolidation.





Functional
currency




The
Company’s operations are located in Switzerland, France and Great Britain. Our
international subsidiaries primarily use local currencies as the functional
currency and translate their assets and liabilities at the current rate of
exchange in effect at the balance sheet date. Revenue and expenses from their
operations are translated using the monthly average exchange rates in effect for
the period in which the transactions occur. The net effect of exchange rates
movements resulting from translation into US Dollars is reported in a separate
account within stockholders equity.




Cash and cash
equivalents




The
Company considers all highly liquid investments with original maturity of three
months or less, when purchased, to be cash equivalents. The carrying amount
reported in the balance sheet for cash and cash equivalents approximates its
fair values.




Concentration of credit
risk




The
Company sells its products through its retail outlets principally to customers
for cash.  Financial instruments that potentially expose Ovale to
concentration of credit risk consist primarily of cash deposits and accounts
receivable. The Company places its cash deposits with high-credit quality
financial institutions. Accounts receivable represents sales to independent
retail stores with corner shops operated under the company’s label. At present
these stores are limited in numbers and the Company does not have a material
receivable against any of them. The Company’s allowance for bad debts, returns
and allowances was US$ 0 for each reporting date. The Company believes no
significant concentration of credit risk exists with respect to these cash
deposits and accounts receivable.




Inventories




Inventories
consist of finished goods and packing material. The Company’s products are
designed by its own designer, a shareholder and officer of the Company, and are
manufactured through independent international suppliers. Products are entered
in inventory upon delivery and only after inspection and acceptance of
quality.  Products that do not meet the Company’s quality standards
are returned to suppliers at no costs to the Company. The Company’s policy of
accounting for inventory is to use average cost method.




6


Shipping and Handling
Costs





Amounts
related to shipping and handling that are billed to customers are reflected in
net sales and the related costs are reflected in cost of goods
sold.




Key Money and Leasehold
Premium




The
Company adopted Statement of Financial Accounting Standards (“SFAS”) No. 142,
“Goodwill and Other Intangible
Assets”, effective with the beginning of fiscal year 2003. In relation to
leasing its retail stores the Company has made payments to the immediately prior
assignor/tenant to acquire leasehold rights. The payments are referred to as key
money or in the United Kingdom, premium.  All the leases are
renewable.   At the expiration of each the company’s leases, the
Company has the right to renew the lease for a new term at a market rate rental
negotiated with the landlord.  At any time, while it has a valid
lease, it may offer the leasehold rights for purchase to a successor tenant, in
the active market for key money or a premium, thus recouping a portion, all (or
none) of the key money or premium it paid and perhaps obtaining an additional
(or lesser) sum.




The key
money or premium is considered a direct cost of the related leases. The cost of
key money or premium, less the residual value, is amortized over the useful life
of the lease to the Company. The amortization method is adopted in recognition
of a change in the estimated future benefits inherent in the asset, the pattern
of consumption of those benefits, and the information available to the Company
about those benefits.  The Company has determined the accumulated
amortization for the prior years is not material and amortizes the amortizable
amounts over the remaining life of the lease agreements on a straight line
basis.




Property and
equipment




Property
and equipment are recorded at cost.  Depreciation is computed using
the straight-line method over the estimated useful lives of the related assets
ranging from three to five years. Property held under capital leases is
amortized over the lesser of the lease term or their estimated useful lives. The
leasehold improvements are amortized over the life of the improvement or the
lease period (9 years), whichever is less.




Valuation of long-lived
assets




In
accordance with SFAS No. 144, “Accounting for the Impairment or
Disposal of Long-Lived Assets”, which the Company adopted effective with
the beginning of fiscal year 2003, the Company assesses the carrying value of
its long-lived assets for possible impairment based on a review of forecasted
operating cash flows and the profitability of the related business. The Company
did not record any impairment losses for the period ended March 31, 2008 and the
year ended December 31, 2007.




Revenue
recognition




We
recognize revenue and the related cost of goods sold at the time the products
are received by the customers in accordance with the provisions of Staff
Accounting Bulletin No. (“SAB”) 101, “Revenue Recognition in Financial
Statements,”as amended by SAB 104, “Revenue
Recognition.”  Revenue is recognized for store sales when the
customer receives and pays for the merchandise at the
register.   For online sales, we estimate and defer revenue and
the related product costs for shipments that are in-transit to the
customer.  Revenue is recognized at the time we estimate the customer
receives the product which is typically within a few days of
shipment.  Amounts related to shipping and handling that are billed to
customers are reflected in net sales and the related costs are reflected in cost
of goods sold and occupancy expenses.  Revenues are presented net of
any taxes collected from customers and remitted to governmental
authorities.




Accumulated other
Comprehensive Loss




Comprehensive
earnings are comprised of net earnings and other gains and losses affecting
equity that are excluded from net earnings. Other comprehensive earnings consist
of foreign currency translation gains or losses.




7










Advertising




Currently
advertising is primarily done through the Company’s officers’ connections with
celebrities.  Advertising costs totaled $66,717 and $8,708 for the
periods ended March 31, 2008 and March 31, 2007,
respectively.  Advertising costs are expensed when the advertising
first appears.




Income
taxes




Income
taxes are accounted for under the asset and liability method. Deferred tax
assets and liabilities are recognized for future tax consequences attributable
to differences between the financial statement carrying amounts of existing
assets and liabilities and their respective tax bases and operating loss and tax
credit carry-forwards. Deferred tax assets and liabilities are measured using
enacted tax rates expected to apply to taxable income in the years in which
those temporary differences are expected to be recovered or settled. The effect
on deferred tax assets and liabilities of a change in tax rates is recognized in
income in the period that includes the enactment date.





Basic and diluted earnings
per share




Basic
earnings (loss) per share (“EPS”) is computed based on the weighted average
number of common shares outstanding for the period. Diluted EPS gives effect to
all dilutive potential shares outstanding (i.e., options and warrants) during
the period.




Recapitalization




On
December 18, 2007 ("the Recapitalization date"), Shareholders of Ovale Group,
Inc. approved the acquisition of all of the outstanding shares of Ovale
S.A.  The transaction was effected by the release of the voting rights
on 5,900,000 shares of Ovale Group, Inc. previously issued to the shareholders
of Ovale S.A and the agreement to issue additional 5,875,000 of Ovale Group, Inc
shares of common stock on April 3, 2008 to the former Class A shareholders of
Ovale S.A.   This transaction resulted in the former Ovale S.A.
stockholders owning a majority interest in the outstanding shares of Ovale
Group, Inc. For financial reporting purposes, the transaction was recorded as a
recapitalization.




Although
Ovale Group, Inc. is the surviving legal entity, the transaction is being
accounted for as an issuance of equity by Ovale S.A. and a recapitalization of
Ovale S.A. under the capital structure of Ovale Group, Inc. in exchange for
$519,883 of net assets (assets of $762,040, less liabilities of $242,157) of
Ovale Group, Inc.   Under the  recapitalization method
of  accounting,  the historical  results of Ovale
S.A. have been carried forward and Ovale Group, Inc.’s
operations  have  been  included  in  the  consolidated   financial   statements
commencing on the recapitalization date.  Accordingly, the historical
results of operations occurring prior to the recapitalization date presented in
the consolidated financial statements are those of Ovale S.A.
only.  Results of operations after the recapitalization date include
the results of both companies on a consolidated basis.




Ovale was
accounted for as the acquirer and as the surviving accounting entity because the
former stockholders of Ovale received 5,900,000 shares which gave them 59% of
voting shares on December 18, 2007.  On April 3, 2008 the former
shareholders of Ovale will receive an additional 5,875,000 shares which will
give these shareholders a total of approximately 75% of the voting rights in the
combined corporation. The 5,900,000 shares issued by Ovale Group have been
accounted for as if those shares comprised the historical share capital of Ovale
Group, Inc.  The 4,171,532 outstanding capital stock of Ovale Group,
Inc., at December 18, 2007, has been accounted for as shares issued by Ovale to
acquire the net assets of Orion. The transaction was treated, for accounting
purposes, as an acquisition (purchase) of control of the assets and business of
Orion by Ovale S.A.




Recent Accounting
Pronouncements




In
December 2007, the FASB issued SFAS No. 141R, "Business Combinations,"or
SFAS 141R. This issuance retains the fundamental requirements in SFAS 141 that
the acquisition method of accounting (which SFAS 141 called the purchase method)
be used for all business combinations and for an acquirer to be identified for
each




8




business
combination. SFAS 141R defines the acquirer as the entity that obtains control
of one or more businesses in the business combination and establishes the
acquisition date as the date that the acquirer achieves control. SFAS 141R is
effective for us beginning January 1, 2009. Though this pronouncement is not
expected to have an effect on our consolidated financial position, annual
results of operations or cash flows, if we were to acquire another entity, we
will account for it in accordance with this pronouncement.




In
December 2007, the FASB issued SFAS No. 160, "Non-controlling Interests in
Consolidated Financial Statements,"("SFAS 160"). This issuance amends
Accounting Research Bulletin 51 to establish accounting and reporting standards
for the non-controlling interest in a subsidiary and for the deconsolidation of
a subsidiary. SFAS 160 clarifies that a non-controlling interest in a subsidiary
is an ownership interest in the consolidated entity that should be reported as
equity in the consolidated financial statements.  SFAS 160 is
effective for us beginning January 1, 2009.  This pronouncement is not
expected to have an effect on our consolidated financial
statements.





NOTE 3 – FIXED
      ASSETSMarch
      31, 2008
            
            
            December
      31, 2007(Unaudited)
            
            
            (Audited)Leasehold
      improvement
            
            $
            1,182,992
            
            
            $
            1,089,907Furniture
      and equipment
            
            
            171,241
            
            
            
            157.415Computer
      appliances
            
            
            124,739
            
            
            
            113,888Total
      Property, plant, and equipment
            
            
            1,478,972
            
            
            
            1,361,210Less:
      accumulated depreciation
            
            
            (510,751
            )
            
            
            (414,084
            )Property,
      plant, and equipment (net)
            
            $
            968,221
            
            
            $
            947,126








Depreciation
expenses for the quarter ended March 31, 2008, and the year ended December 31,
2007, were $96,667, and $183,309, respectively.





NOTE
4— LEASE PREMIUM AND KEY MONEY




On
October 15, 2007 the Company paid $770,067 to prior tenants of the new retail
store opened in December 2007 in London for their assignment of their lease to
the Company.  This lease “premium” is amortized over the
remaining lease period for the respective property.  The lease premium
is as follows:




March
      31,
              2008
              (Unaudited)Lease
      premium, at cost
            
            $
            770,067Less:
      Accumulated amortization
            
            
            (84,486
            )Lease
      premium, net of accumulated amortization
            
            $
            685,581





Both the
cost and accumulated amortization of lease premium is impacted by
fluctuations in foreign currency rates.




9





In
relation to the lease agreement for the retail store locations and office space
in Paris, the Company paid $401,824 to the previous leaseholder as key
money.  Key money was also paid for the retail location in Zurich for
CHF 150,000 or $120,345. The estimated residual value of these intangible assets
is $469,952. The difference between the historical cost and the estimated
residual value is amortized over the remaining lease period for the respective
properties.  Key money is as follows:




March
      31, 2008
              (Unaudited)Key
      money, at cost
            
            $
            522,169Less:
      Accumulated amortization
            
            
            (34,890
            )Key
      money, net of accumulated amortization
            
            $
            487,279








Both the
cost and accumulated amortization of key money are impacted by fluctuations in
foreign currency rates. Amortization expenses related to Key Money for the
period ended March 31, 2008 was $ 6,978.





NOTE
5 – CREDIT LINES WITH FINANCIAL INSTITUTIONS





The
Company has secured and unsecured lines of credit with major banks in
Switzerland, France and England. As of the dates indicated the net outstanding
balances by financial institution were:










March
      31, 2008
              (Unaudited)
            
            
            December
      31, 2008
              (Audited)Credit Lyonnais,
      France
            
            $
            34,350
            
            
            $
            49,493Migros,
      Switzerland
            
            
            1,432,157
            
            
            
            1,261,125$
            1,466,507
            
            
            $
            1,310,618





NOTE
6 — NOTES PAYABLE




The
Company is obligated to a non-controlling shareholder for $30,000 advanced to
fund operations.  The note bears interest at 8% per annum and was
repayable on the earlier of February 8, 2007 or within 20 days of the closing of
the recapitalization between the Ovale Group, Inc. (formerly known as Orion
Diversified Technologies, Inc.) and Ovale S.A.  As additional
consideration, the Company shall issue 40,000 shares, $.01 par value, of common
stock.  Because the Company did not pay the note on the due date, the
Company is obligated to issue to the lender 10,000 shares of common stock for
each month the company does not repay the loan, commencing on the first day of
the first month following the due date continuing until the loan is repaid in
full together with all the accrued interest.  As of March 31, 2008 had
not repaid the loan and was required to issue the shareholder a total of 170,000
shares.




NOTE
7 — TAXES AND NET OPERATING LOSS CARRY FORWARDS




Under
current tax laws governing jurisdictions we have net operating loss
carry-forwards, or NOLs, of $5,123,000.   NOLs in France and UK
of approximately $1,547,000 and $227,000, respectively, are subject to carry
forward indefinitely.  NOLs in Switzerland and the United States of
approximately $3,202,000 and $456,000, expire in seven and twenty years,
subsequent to the year generated.  However, due to a change of over
50% in ownership of our US parent company, Ovale Group, Inc., the US tax laws
substantially limit the amount of net operating Loss Carry forward that may be
utilized each year.




10





The
estimated statutory tax rates were approximately 26% in Switzerland, 30% in UK,
34% in France and 35% in the United States.  The reconciliation of
statutory tax to effective tax amount is as follows:






March
      31, 2008
            
            
            March
      31, 2007Tax
      at statutory rate
            
            $
            --
            
            
            $
            --Tax
      benefit of loss carry forward
            
            
            90,000
            
            
            
            93,000Less:  Increase
      in valuation allowance
            
            
            (90,000
            )
            
            
            (93,000
            )Tax
      at effective rate
            
            $
            --
            
            
            $
            --








The tax
asset from NOL computed at estimated statutory rates were are
follows:







March
      31, 2008
            
            
            December
      31, 2007Net
      operating loss carry-forward
            
            $
            1,580,000
            
            
            $
            1,490,000Less: valuation
      allowance
            
            
            (1,580,000
            )
            
            
            (1,490,000
            )Tax
      asset, net
            
            $
            -
            
            
            $
            -







Realization
of deferred tax assets associated with the NOL is dependent upon generating
sufficient taxable income prior to their expiration.  Management
believes that there is a risk that certain of these NOLs may expire unused and,
accordingly, has established a valuation allowance against them. Although
realization is not assured for the remaining deferred tax assets, based on the
historical trend in sales and profitability, sales backlog, and budgeted sales
of the Company, management believes it is likely that they may not be totally
realized through future taxable earnings. In addition, the net deferred tax
assets could be reduced in the near term if management’s estimates of taxable
income during the carry forward period are significantly reduced.




The
company increased its valuation allowance by $90,000 and $93,000, for the period
ended March 31, 2008 and the period ended March 31, 2007
respectively.  The valuation allowances were increased to offset the
additional estimated tax assets of $90,000 and $93,000 recognized as a result of
incurring net operating loss of  $280,742 for the period ended March
31, 2008 and $311,492, for the period ended March 31, 2007
respectively.





The
pre-recapitalization loss of Orion Diversified Technologies was approximately
$367,000.  The U.S. tax laws substantially limit the amount of net
operating loss carry forward that may be realized each year.




NOTE
8 — ACCOUNTS AND LOANS PAYABLE




As of
March 31, 2008, the accounts payable and accrued expenses of the Company were as
follows:





March
      31, 2008(Unaudited)Accounts
      payable
            
            $
            541,513Accrued
      expenses
            
            
            92,625Total
      accounts payable
            
            $
            634,138




11





As of
March 31, 2008, loans payable were as follows:


(Unaudited)Loan
      payable, non-controlling shareholder
            
            $
            25,000Liability
      to issue shares to note-holder as interest
            
            
            88,200Other
      loans payable
            
            
            3,100Total
      loans payable and interest
            
            $
            116,300







NOTE
9 - LEASES





The
Company has operating leases for its shops and offices. The Company entered the
leasing agreement for the first Paris store on July 4, 2003. The term of the
lease is non cancellable for nine years with a fixed annual rent of $91,250
(€74,862), automatically renewable thereafter.





The
Company opened a second store in Paris on June 5, 2006. The term of the lease is
non cancellable for ten years starting June 15, 2006 with a fixed annual rent of
$85,323 (€70,000)





In
Switzerland the Company has an operating lease for the Geneva store which
started on September 1, 2004, is non cancellable for 5 years and renewable
thereafter for periods of 5 years. The minimum rent is of $45,300 (CHF
56,000).  Subject to annual escalation based on Swiss consumer price
index. The rent is also increased by 8% of revenues.





A second
store was opened in Zurich end of 2006. The minimum rent is CHF 51,216
($41,200).





Since
inception of the Company, it has subleased its office’s space in Geneva. This
lease is cancellable by both parties with 3 months notice.





Future
minimum rental payments under non-cancellable operating leases are as
follows:








Year
      Ended
              December
      31,2008
            $   562,0002009
            580,0002010
            590,0002011
            600,0002012
            610,0002013-2018
            630,000Total
            $  3,572,000





The lease
payments were $152,659 for the period ended March 31, 2008, and $90,661 for the
period ended March 31, 2007.





NOTE
10 – COMPENSATION PLANS





In
Switzerland, the company has a defined contribution plan where contributions are
made on an equal basis by the employee and the employer. The total contribution
varies between 7% and 18 %, based on the age of the employee. The charge for the
compensation plan for the period ended March 31, 2008 was $2,935 and $ 2,598 for
the period ended March 31, 2007. In Switzerland, the Company provides accident
insurance but not health or any post retirement benefits. In line with Swiss
business practice, the Company offers its employees up to one month of paid sick
leave.




12





In
France, no compensation plans are mandatory, but the Company is required to
accrue 1% to 2% of personnel costs to be used in social activities.





Vacation
time is accrued during the period and must be taken during the period or within
a maximum time frame in the following period. There are no cumulative sick days
or vacation days.





NOTE 11 – SEGMENT
INFORMATION





The
Company operates in three different countries with separate shops, sales,
accounting and administrative teams.








March
      31, 2008
            
            
            March
      31, 2007(Unaudited)
            
            
            (Unaudited)SalesFrance
            
            $
            299,020
            
            
            $
            235,224Switzerland
            
            
            313,519
            
            
            
            150,979England
            
            
            76,561
            
            
            
            --Total
            
            $
            689,100
            
            
            $
            386,193Fixed
      AssetsFrance
            
            $
            429,645
            
            
            $
            428,920Switzerland
            
            
            352,507
            
            
            
            176,916England
            
            
            186,069
            
            
            
            --Total
            
            $
            968,221
            
            
            $
            605,836








For the
period ended March 31, 2008, the Net Sales of $689,100 included $199, 608 of
intercompany sales.





NOTE
12 – RELATED PARTY TRANSACTIONS





Employment
agreement with CEO





We
entered into an employment contract with our CEO in January 2003 for an annual
salary of CHF 180,000 ($ 129,500). The contract was amended as of January 1,
2004, and the new salary adjusted to CHF 240,000 ($187,000), for the following
years. Payment of that additional sum is contingent upon improvements in
available cash.





Loan
from principal shareholder





The
principal shareholder has advanced funds to the Company to the amount of
$6,759,495 as of March 31, 2008.   The amounts have been used for
working capital and for the purpose of opening  new store locations.
These amounts are payable on demand and bear no interest. As part of the
recapitalization agreement, the principal shareholder exchanged $543,770 in
notes receivable from Ovale for 1,166,900 shares of Orion.




NOTE
13 – GOING CONCERN BASIS AND FUTURE PLANS





The
accompanying consolidated financial statements have been prepared on a going
concern basis, which contemplates the realization of assets and satisfaction of
liabilities in the normal course of business.




13





The
Company has limited operations, no substantial continuing source of revenues,
and working capital and stockholders' deficits. Present operations require
substantial capital and until revenues are sufficient to fund ongoing
operations, the Company is highly dependent on owner financing. The Company has
merged with a public company and avails itself the opportunity to find suitable
investors to implement and expand its plans internationally. Its primary sources
of liquidity have been loans from the owner and related parties. These
conditions raise substantial doubt about its ability to continue as a going
concern.





NOTE
14- SUBSEQUENT EVENTS





The
Second Closing pursuant to the Share Exchange agreement was concluded on April
3, 2008.   At the Second Closing, Ovale Group, Inc. (OVGL)
delivered the remaining 5,875,000 shares of its common stock, $.01 par value per
share, to the individual Ovale shareholders in exchange for all of the Ovale
shares and Mr. Cottier delivered the 2,669,541 shares he had held in escrow
since November, 2004 to Vladimir Fabert (1,949,541 shares) and to Alexandra
Fabert (720,000 shares).





Ovale
S.A. has become a wholly owned subsidiary of OVLG, and the shareholders of Ovale
collectively own approximately 75% of the total number of shares of OVLG's
common stock issued and outstanding as of the delivery of those shares effective
April 4, 2008.  Following the closing of the Share Exchange: (i)
Messrs. Vladimir Fabert and Gilles Neveu became OVLG's principal executive
officers and members of the OVLG's three person Board of Directors; (ii)
Vladimir Fabert became OVLG’s CEO and CFO; (iii) Gilles Neveu became OVLG’s Vice
President and Chief Designer; and (iv) Irwin Pearl remained a member of the
OVLG's Board of Directors.






14


ITEM
2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
OPERATION




The
Private Securities Litigation Reform Act of 1995 contains "safe harbor"
provisions regarding
forward-looking   statements.   Except for
historical information contained herein, the matters discussed in this
section contain potential risks and uncertainties including, without limitation,
risks related to the Issuer's ability to successfully identify potential
merger partners, retain key employees and settle any outstanding debts.
The Issuer will need to attract partners in order to execute its revised
business strategy, and there can be no assurance that the Issuer will be
successful in attracting such partners.




The
following discussion should be read in conjunction with OVLG’s financial
statements and the related notes.  Those statements and notes appear
elsewhere in this Quarterly Report.  This discussion contains
forward-looking statements that reflect plans, estimates and
beliefs.  Our actual results could differ materially from those
discussed in the forward looking statements.  Factors that could cause
or contribute to such differences include, but are not limited to, those
discussed below, elsewhere in this Quarterly Report, and in the “Certain Risk
Factors Which May Affect Ovale's Future Performance” referred to in Item 1A and
appearing in Item 1A to Part I of our Annual Report on Form 10-K for the
year ended December 31, 2007.




When used
in conjunction in the following discussions, the words “believes,”
“anticipates,” “intends,” “expects,” and similar expressions are intended to
identify forward-looking statements.




Overview





OVLG has
limited operations, but its continuing sources of revenues are not sufficient to
pay for its costs and expenses. It has working capital and stockholders’
deficits.   Present operations require substantial capital and
until revenues are sufficient to fund ongoing operations, OVLG will be highly
dependent on external sources of financing.  OVLG believes that the
increased number of stores and the subsequent increase in revenues will
allow OVLG to raise additional funds from investors to finance its growth
up to the point where revenues will be sufficient to fund ongoing
operations.





OVLG has
no net cash flow from operations and does not expect to generate any
positive cash flows in the immediate future. These conditions raise substantial
doubt about its ability to continue as a going concern.




However,
OVLG has already completed the development stage. Its revenues increased from
$324,925 to $486,261, its assets from $3,717,000 to $3,779,863 and its
gross profits from $173,572 to $379,757, from quarter ended March 31, 2007 and
2008, respectively. All of our stores had gross profits. Presently, OVLG is in
the growth and marketing phase. It needs to triple its sales and gross profits
to pay for its quarterly operating expenses which were $784,206 in the quarter
ended March 31, 2008.   Our strategy involves:




1.
            To
      search world markets for cheaper sources of supply and obtain volume
      discounts to increase the gross profit margin which was $379,757, or
      78%,  and thus decrease its cost of sales as a percentage of
      sales.2.
            To
      attract additional customers as a result of established quality, brand
      name and high class locations.3.
            To
      establish new stores and expand sales to make additional gross profits to
      pay for the operating expenses.  Presently, the target number of
      stores is six to eight.




Critical
Accounting Policies and Estimates




The
preparation of financial statements requires us to estimate the effect of
various matters that are inherently uncertain as of the date of the financial
statements. Each of these required estimates varies in regard to the level of
judgment involved and its potential impact on our reported financial results.
Estimates are deemed critical when a different estimate could have reasonably
been used or where changes in the estimate are reasonably likely to occur from
period to period, and would materially impact our financial condition, changes
in financial condition, or results of operations. Our significant accounting
policies are discussed in Note 2 of the Notes to Consolidated Financial
Statements; critical estimates inherent in these accounting policies are
discussed in the following paragraphs.





15


Principles
of consolidation





The
consolidated financial statements of OVLG include the accounts of Ovale,
and its French and English subsidiaries. All significant inter-company
transactions and balances are eliminated in consolidation.




New Accounting Pronouncements





There are
a number of pronouncements of the U.S. Financial Accounting Standards Board
(“FASB”) which affect or may affect OVLG’s presentation of its financial
statements.  These are set out in footnotes to those financial
statements.  Rather than repeat them here, we urge you to read them in
conjunction with this Management’s Discussion.





The
following are particular factors which we think you should consider in reading
OVLG’s financials.  However, they should not be considered to the
exclusion of the other factors in the financial statements or elsewhere in this
Quarterly Report, since this entire document should be read as a
whole.




Inventory
Valuation





The
inventories in our United Kingdom, French and Swiss stores are accounted for
under the lower of cost or market method, with cost determined using the average
cost method. Inventory valuation is impacted by the estimation of slow moving
goods, shrinkage and markdowns.





Leasehold
Premium and Key Money




We
continually evaluate whether events and changes in circumstances warrant revised
estimates of the useful lives or recognition of an impairment loss for
intangible assets. Future adverse changes in market and legal conditions, or
poor operating results of underlying assets could result in losses or an
inability to recover the carrying value of the intangible asset, thereby
possibly requiring an impairment charge in the future. We make investments
through our international subsidiaries in intangible assets upon the opening and
acquisition of many of our store locations in Europe. These other intangible
assets, which are subject to amortization, are amortized over the useful lives
of the respective leases, not to exceed 5 years. We evaluate the market value of
these assets periodically and record the impairment charge when we believe the
asset has experienced a decline in value that is other than
temporary.





Functional
currency




Ovale’s
operations are located in Switzerland, France, and England. Ovale operates in
Swiss Francs (CHF). For reporting purposes, assets and liabilities are
translated into US Dollars (US$) at the exchange rates in effect at the balance
sheet date. Revenues and expenses are translated into US Dollars at the weighted
average exchange rates for the period. The net effect of exchange rates
movements resulting from re-measurement into US Dollars is reported in a
separate account within stockholders equity.  The net effect of
exchange rates in our general operations is covered in “Effect of Currency
Fluctuations”




Cash
and cash equivalents




From time
to time, Ovale has cash which it invests in money market instruments. Ovale
considers all highly liquid investments with original maturity of three months
or less, when purchased, to be cash equivalents. The carrying amount reported in
the balance sheet for cash and cash equivalents approximates its fair
values.




Concentration of credit risk




Ovale
sells its products through its retail outlets principally to customers for cash.
Financial instruments that potentially expose Ovale to concentration of credit
risk consist primarily of cash deposits and accounts receivable. The Company
places its cash deposits with high-credit quality financial institutions.
Accounts receivable represents sales to independent retail stores with corner
shops operated under Ovale’s label. At the moment these stores are limited in
numbers and Ovale does not have a material receivable against any of them.
Ovale’s allowance for bad debts, returns and allowances was US$ 0 for each
reporting date. Ovale believes no significant concentration of credit risk
exists with respect to these cash deposits and accounts receivable.




16




Valuation
of long-lived assets





We
evaluate the carrying value of long-lived assets whenever events or changes in
circumstances indicate that a potential impairment has occurred. A potential
impairment has occurred if the projected future undiscounted cash flows are less
than the carrying value of the assets. The estimate of cash flows includes
management's assumptions of cash inflows and outflows directly resulting from
the use of the asset  in operations. When a potential impairment has
occurred, an impairment charge is recorded if the carrying value of the
long-lived asset exceeds its fair value. Fair value is measured based on a
projected discounted cash flow model using a discount rate we feel is
commensurate with the risk inherent in our business. Our impairment analyses
contain estimates due to the inherently judgmental nature of forecasting
long-term estimated cash flows and determining the ultimate useful lives of
assets. Actual results may differ, which could materially impact our impairment
assessment.





March
      31,2008
            December
      31, 2007Long-lived
      assets-net
            $968,221
            $947,126







Revenue
recognition





Sales are
recognized at the point of sale, which occurs when merchandise is sold
over-the-counter in consumer transaction or, through wholesale channels to the
boutique locations, upon shipment of merchandise, when title passes to the
customer. Allowances for estimated uncollectible accounts, discounts, returns
and allowances are provided when sales are recorded.





Shipping
and handling





Shipping
and handling costs when incurred (deliveries to independent corner shops) are
included in cost of goods sold.




Income
taxes





We are
subject to income taxes in many jurisdictions, including the US, individual
states and localities and abroad. We must first determine which revenues and
expenses should be included in each taxing jurisdiction. This process involves
the estimation of our actual current tax exposure, together with the assessment
of temporary differences resulting from differing treatment of income or expense
items for tax and accounting purposes. We establish deferred tax assets and
liabilities as a result of these temporary differences. We have established a
valuation allowance against our deferred tax assets, which also materially
affects our effective tax rate. We establish tax reserves in our consolidated
financial statements based on our estimation of current tax
exposures.




Income
tax expense also reflects our best estimate and assumptions regarding, among
other things, the level of future taxable income, interpretation of tax laws,
and tax planning. Future changes in tax laws, changes in projected levels of
taxable income and tax planning could affect the effective tax rate and tax
balances recorded by us.




On an
on-going basis, we evaluate our estimates. We base our estimates on historical
experience and on various other assumptions that we believe to be reasonable
under the circumstances at the time, the results of which form the basis for
making judgments about the carrying values of assets and liabilities that are
not readily apparent from other sources.




Although
management believes that the estimates discussed above are reasonable and the
related calculations conform to generally accepted accounting principles, actual
results could differ from these estimates, and such differences could be
material.




17





Basic
and diluted earnings per share





Basic
earnings (loss) per share (“EPS”) is computed based on the weighted average
number of common shares outstanding for the period. Diluted EPS gives effect to
all dilutive potential shares outstanding (i.e., options and warrants) during
the period.





Results
of Operations




The
following is a comparison and commentary on certain items in the financial
statements of Ovale for the quarters ended March 31, 2008 and March 31,
2007.





The
following should be read in conjunction with our consolidated financial
statements and the related notes. The following table sets forth, as a
percentage of sales, certain items appearing in our consolidated statements of
operations.





OVALE
GROUP. INC.


(FORMERLY
      ORION DIVERSIFIED TECHNOLOGIES
INC.)


CONSOLIDATED
STATEMENTS OF OPERATION


Unaudited
            
            Three
      Months Ended
            
            
            Three
      Months Ended
            
            
            Change
      fromMarch
      31, 2008
            
            
            March
      31, 2007
            
            
            March
      31, 2007 to 2008Amount
            
            
            Percent
            
            
            Amount
            
            
            Percent
            
            
            Amount
            
            
            PercentSales
            
            $
            486,261
            
            
            
            100
            %
            
            $
            324,925
            
            
            
            100
            %
            
            $
            161,336
            
            
            
            50
            %Cost
      of goods sold
            
            
            106,504
            
            
            
            22
            %
            
            
            151,352
            
            
            
            47
            %
            
            
            (44,848
            )
            
            
            (30
            )%Gross
      profit
            
            
            379,757
            
            
            
            78
            %
            
            
            173,572
            
            
            
            53
            %
            
            
            206,185
            
            
            
            119
            %Operating
      expenses:Salaries
            
            
            232,617
            
            
            
            48
            %
            
            
            176,318
            
            
            
            54
            %
            
            
            56,299
            
            
            
            32
            %General
      Administrative
            
            
            386,964
            
            
            
            80
            %
            
            
            181,668
            
            
            
            56
            %
            
            
            205,296
            
            
            
            113
            %Marketing
            
            
            149,907
            
            
            
            31
            %
            
            
            88,915
            
            
            
            27
            %
            
            
            60,992
            
            
            
            69
            %Professional
      fees
            
            
            14,718
            
            
            
            3
            %
            
            
            18,432
            
            
            
            6
            %
            
            
            (3,714
            )
            
            
            (20
            )%Total
      operating expenses
            
            
            784,206
            
            
            
            161
            %
            
            
            465,333
            
            
            
            143
            %
            
            
            318,873
            
            
            
            69
            %Loss  from
      operations
            
            
            (404,449
            )
            
            
            (83
            )%
            
            
            (291,761
            )
            
            
            (90
            )%
            
            
            (112,688
            )
            
            
            39
            %Other
      income (expense)Interest
      income
            
            
            -
            
            
            
            
            
            
            
            -Interest
      expense
            
            
            (39,680
            )
            
            
            (8
            )%
            
            
            (17,186
            )
            
            
            (5
            )%
            
            
            (12,994
            )
            
            
            131
            %Foreign
      exchange
            
            
            150,657
            
            
            
            31
            %
            
            
            (11,864
            )
            
            
            (4
            )%
            
            
            162,521
            
            
            
            (1370
            )%Other
            
            
            3,230
            
            
            
            1
            %
            
            
            9,319
            
            
            
            3
            %
            
            
            (6,089
            )
            
            
            (65
            )%Total
      other income (expenses)
            
            
            114,207
            
            
            
            23
            %
            
            
            (19,731
            )
            
            
            (6
            )%
            
            
            143,438
            
            
            
            (679
            )%Net
      Loss
            
            $
            (290,242
            )
            
            
            (60
            )%
            
            $
            (311,492
            )
            
            
            (96
            )%
            
            $
            30,750
            
            
            
            (7
            )%





18


Net
sales





Our net
sales for the quarter ended March 31, 2008 increased $161,336, or 50%, compared
to the same period in 2007. This increase can be attributed to the store opened
in London in December 2007, and increased sales in Switzerland and
France.


.


Cost
of goods sold





Cost of
goods sold decreased by $44,848 (30%) from $151,35I in the quarter ended March
31, 2008 to $106,504 for the same period of 2007.   The cost of goods
sold as a percentage of sales decreased from 47% to 22%. The decrease in cost of
goods sold can be attributed to a number of factors: efficiencies in
purchasing; the store in London did not open until December 2007 and
therefore no sales or cost of goods sold reflecting that location appear in the
first quarter of 2007; and product sales in London for the first quarter of 2008
were at a higher prices than in other locations resulting in a lower cost of
goods sold for that location for the first quarter of 2008.  However, there
can be no assurance that we will be able to maintain level of cost of goods sold
in the future.




Gross
profit





Our gross
profit for the quarter ended March 31, 2008 increased by $206,185, or 119%, from
$173,572 in the same quarter of 2007 to $379,757.  This increase
reflects the 50% increase in net sales and the decrease of
30%  in cost of goods sold.  Our gross profit as a
percentage of sales increased to 78% in the quarter ended March 31, 2008 from
53% in the same quarter of 2007.





Ovale’s
business is sensitive to many factors that may have a negative impact on its
sales and profitability. Those factors include, and are not limited to, overall
economic conditions, changes in fashion trends and consumer preferences. Most of
these factors are beyond Ovale’s control. Ovale believes that part of its
success depends on its capacity to anticipate and react accordingly to
variations of some of these factors. However, there can be no assurance that
Ovale will be able to anticipate, gauge and respond with a timely and
appropriate manner to the above variations.  Please see “Certain Risk Factors Which May
Affect Ovale's Future Performance” in Part 1A of our Annual Report on
Form 10K for the year ended December 31, 2007.





Ovale
intends to continue launching new products and new stores on a regular
basis while staying focused on its chosen market, namely fashion products for
infants, zero to twelve months of age. During fiscal 2008, the management of
Ovale expects the further implementation of its purchasing policy will yield
substantially higher gross margins.





Operating
expenses





In the
quarter ended March 31, 2008, operating expenses increased by $318,873 from
$465,333 in the same quarter of 2007 to $784,206I, or 69%.  As a
percentage of sales, operating expenses increased to 161% in the quarter ended
March 31, 2008 compared to 143% in the same quarter in 2007.  The main
components of Ovale’s operating expenses are as follow:





Salaries in the quarter ended
March 31, 2008 increased by $56,299 from $176,318 in the comparable quarter of
2007 to $232,617, or 32%.  The increase in salaries is due to the staffing
related to the store opened in London in December, 2007. However, Ovale managed
to decrease salaries as a percentage of sales by 6%, from 54% to 48%, in the
comparable periods.  This decrease is due, in part, to the better
utilization of employees and in part to improved ability of management to
coordinate administrative and operational activities without the need of
additional personnel.





General administrative
expenses increased by $205,296, or 113%, from $181,668 in the quarter ended
March 31, 2007 to $386,964 in the quarter ended March 31,
2008.   General administrative expenses were 80% of sales as
compared to 56% of sales in the comparable quarter of 2007.  This
increase is primarily due to the occupancy costs of the London
store.  The overhead incurred in regard to that opening and various
consulting fees, such as attorneys and accountants are reflected in General
Administrative expenses. With additional store openings, management expects
escalation of sales and occupancy costs while other expenses will increase
minimally.




19





Marketing expenses increased
$60,992, from $88,915 in the quarter ended March 31, 2008 to $149,907 in the
comparable quarter of 2007, or 69%.  As a percentage of sales,
marketing expenses increased by 4%, to 31% in the quarter ended March 31, 2008
from 27% in the comparable quarter of 2007.  Marketing expenses were
kept relatively flat as the marketing strategy of the company focuses on
celebrity driven publicity.  Marketing expenses are intended to
promote the brand as a whole, not the stores specifically.  Management
expects this strategy to successfully continue with the opening of additional
stores and therefore expects marketing expense to increase as a percentage
of sales.




Professional
fees decreased by $3,714 from $18,432 in the quarter ended March 31,
2008 to $14,718 in the comparable quarter of 2007 or (20) %.  We
renegotiated the unpaid professional fees for the prior years and obtained a
credit of $27,106.  The reduction in professional fees is in part due
to this credit and in part due to reduction in fees paid to attorneys and
external advisors in relation the pending merger of Ovale with Orion Diversified
Technologies Inc.





Operating
expenses are high when compared to the sales of Ovale.  It is
important to note that Ovale’ management intends to develop a recognizable
luxury brand.  In addition to the operation of its stores Ovale
has built an infrastructure to further the establishment of the Ovale
brand.  This infrastructure is meant to develop the line of products
sold at the retail stores and to support a greater number of stores without
additional substantial investment in the infrastructure.  Management
believes that when a critical mass of stores is present, Ovale’s corporate
infrastructure related costs will be in line with the industry.  The
critical mass of stores is estimated at six to eight stores depending on the
average revenues that each new store will achieve.




SEGMENT
INFORMATION




March
      31, 2008
            
            
            March
      31, 2007(Unaudited)
            
            
            (Unaudited)SalesFrance
            
            $
            299,020
            
            
            $
            235,224Switzerland
            
            
            313,519
            
            
            
            150,979England
            
            
            76,561
            
            
            
            --Total
            
            $
            689,100
            
            
            $
            386,193Fixed
      AssetsFrance
            
            $
            429,645
            
            
            $
            428,920Switzerland
            
            
            352,507
            
            
            
            176,916England
            
            
            186,069
            
            
            
            --Total
            
            $
            968,221
            
            
            $
            605,836







Currency
Fluctuation





In recent
months the value of the US dollar has declined in relation to both the euro and
the Swiss franc.  In the quarter ended March 31, 2008 the registrant
had a gain of $150,657 on foreign currency translation as compared to a loss of
$11,864 for the comparable period of 2007.  This gain (31% of sales)
in the quarter ended March 31, 2008 as compared to a loss (4% of sales) in the
comparable period of 2007 constitutes a 1370% increase.





Income
(loss)





Our loss
from operations and net loss were $404,449 and $280,742, respectively, in the
three months ended March 31, 2008 as compared to $291,761 and $311,492,
respectively, in the three months ended March 31, 2007.  The increase
in operating loss of $143,438 (90%), in the quarter ended March 31, 2008, was
primarily due to the increased general and administrative
expenses.  The gain from exchange of $150,657 reduced our operating
and net losses in the three months ended March 31, 2008.




20





As a
result of the items discussed above, Ovale’s losses have decrease $30,750, or
10%, from $311,492 in the quarter ended March 31, 2008 to $280,742 in the
quarter ended March 31, 2007.  This is a decrease from 96% of sales in
the quarter ended March 31, 2007 to 58% of sales in the quarter ended March 31,
2008.





Financial
Conditions and Liquidity




Cash
Flows




(in
      thousands)
            
            2008
            
            2007
            
            Increases in
              CashNet
      cash provided by operating activities
            
            $
            (570,184
            )
            $
            (383,461
            )
            $
            (186,723
            )Net
      cash used in investing activities
            
            $
            (122,117
            )
            $
            (50,074
            )
            $
            (72,043
            )Net
      cash provided by financing activities
            
            $
            1,255,972
            
            $
            644,402
            
            $
            611,570





The
increase in cash used by operating activities of $186,723 was due to higher net
loss before the impact of depreciation and amortization. During the three months
ended March 31, 2008, inventories incre ased by $216,514 compared to a decrease
of $64,746, in the comparable period last year.  Investment in
inventories was due to the opening new stores in 2008.  Our accounts
payable decrease by $263,936, in the three months ended March 31, 2008 as
compared to $16,222 the three months ended March 31, 2007.





Cash used
by investing activities included capital expenditures of $122,117 including the
$117,762 for the purchase of leasehold rights and shop and office equipment. We
plan to continue investing in new stores.






Cash
provided by financing activities in the three months ended March 31, 2008
consists of $1,094,491 in loans from a shareholder and $161,481 of borrowing
from bank lines of credit. The cash provided by financing activities were used
to primarily pay the operating expenses.





Ovale's
current liabilities as of March 31, 2008 were $8,989,226, as compared to $7,981,190as ofMarch 31,
2007.   The current liabilities increased by $1,008,036 or
13% as of March 31, 2008 from March 31, 2007.   The primary
reason for the increase is the additional loans from shareholders and related
parties to cover the expenses discussed above.





The
Company’s net working capital deficit was $7,490,322 and $ 6,585,648 as of March
31, 2008 and March 31, 2007, respectively.  This decrease was
primarily because of the negative cash flows from operation and dependence on
short term loans from shareholders to finance the expenditures.





Ovale’s
consummation of the merger with Orion is crucial for its strategy of accessing
new financing sources, rapidly establishing new stores internationally,
increasing the volume of sales and gross profit margin and creating a profitable
operation by spreading its fixed costs over larger volume of sales.




ITEM
3.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK





Currency
fluctuations can have a substantial impact on Ovale’s financial position. In
recent months the value of the US dollar has declined in relation to both the
euro and the Swiss franc.  For an additional discussion of the affect
on the company of currency fluctuations, see Item 2, Management’s Discussion and
Analysis of Financial Condition and Results of Operations above and in the
registrant’s 10-KSB filed for the year ended December 31,
2007.




21


ITEM
4. CONTROLS AND PROCEDURES




(a)
Evaluation of Disclosure Controls and Procedures




An
evaluation of the effectiveness of the design and operation of our disclosure
controls and procedures (as defined in Exchange Act Rules 13a-15(e) and
15d-15(e) as of March 31, 2008 was carried out under the supervision and with
the participation of Ovale Group, Inc.’s  management, including the
President and Chief Executive Officer and the Chief Financial Officer (“the
Certifying Officers”).  Based on that evaluation, the Certifying
Officers concluded that the Company’s disclosure controls and procedures are
effective.




Disclosure
controls and procedures are designed to ensure that information required to be
disclosed in our reports filed or submitted under the Securities Exchange Act is
recorded, processed, summarized and reported within the time periods specified
in the SEC’s rules and forms.  Disclosure controls and procedure
include, without limitation, controls and procedures designed to ensure that
information required to be disclosed in our reports filed or submitted under the
Securities Exchange Act is accumulated and communicated to management, including
our President and Chief Financial Officer, as appropriate, to allow timely
decisions and timely reporting regarding required disclosure.




(b)
Changes in Internal Controls




The was
no change to the Company’s internal control over financial reporting during the
quarter ended March 31, 2008 that materially affected, or is reasonably likely
to materially effect, the Company’s internal control over financial
reporting.




ITEM
5.  OTHER INFORMATION




The
registrant’s common stock is now listed on the Pink Sheets with the symbol
OVLG.PK.  During the twenty four month period ended in May 2008, the
registrant did not file three of its periodic reports, including this 10-Q, with
the SEC within the prescribed time periods.  As a mathematical
consequence, the registrant’s listing on the OTCBB was removed but the
registrant’s appearance on the Pink Sheets continued.  The registrant
has been advised that if it files all its required reports in a timely manner,
including  automatic extensions of filing times obtainable by filing
Form 12b-25, it will have complied with the requirement for application to be
relisted on the OTCBB.




22


PART
II - OTHER INFORMATION




ITEM
1A. RISK FACTORS






Information
related to our risk factors are disclosed under Item 1A to Part I of our
Annual Report on Form 10-K for the year ended December 31,
2007.




ITEM
6. EXHIBITS





Exhibits:




2.(i)
            Exchange
      Agreement dated September 15, 2004 between the Company and Ovale S.A.
      incorporated by reference to Exhibit A to the Proxy Statement of OVGL
      filed on November 13, 2007.2.(ii)
            Amendment,
      dated November 8, 2004, to Exchange Agreement dated September 15, 2004
      between the Company and Ovale, S.A. incorporated by reference to Exhibit B
      to the Proxy Statement of OVGL filed on November 13, 2007.2.(iii)
            Second
      Amendment, dated January 3, 2006, to the Exchange Agreement dated
      September 15, 2004, . incorporated by reference to Exhibit C to the Proxy
      Statement of OVGL filed on November 13, 2007.2.
      (iv)
            Fourth
      Amendment, dated September 10, 2007, to the Exchange Agreement dated
      September 15, 2004,  incorporated by reference to Exhibit D to the
      Proxy Statement of OVGL filed on November 13, 2007.
              .3.(i)1
            Certificate
      of Incorporation incorporated by reference to Exhibit (1)(i) to
      Registration Statement filed on Form S-13.(i)2
            Amendment
      to Articles of Incorporation incorporated by reference to Item (1)(ii)
      filed with Form 10K for the year ended April 30, 19833.(ii)
            By-laws
      – incorporated by reference to Exhibit 3 (ii) to the 10KSB/A filed
      on  May 16, 200810.1
            Employment
      contract with Vladimir Fabert dated 2004, incorporated by reference to
      Exhibit 3 (ii) to the 10KSB/A filed on  May 16,
200810.2(i)
            Contract
      with Gilles Neveu dated 2002, incorporated by reference to Exhibit 3
      (ii) to the 10KSB/A filed on  May 16, 200810.2(ii)
            Amendment
      to contract with Gilles Neveu dated January 2008, incorporated by
      reference to Exhibit 3 (ii) to the 10KSB/A filed on  May 16,
      200831(i)1
            Certification
      pursuant to Rule 13a-14(a)/15d-14(a)31(i)2
            Certification
      pursuant to Rule 13a-14(a)/15d-14(a)32.1
            Certification
      of the Chief Executive Officer pursuant to Section 1350 of the
      Sarbanes-Oxley Act of 2002.32.2
            Certification
      of the Chief Financial Officer pursuant to the Sarbanes-Oxley Act of
      2002.




23


SIGNATURES




Pursuant
to the requirements of the Securities Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.




OVALE
GROUP, INC.




By: /s/
Vladimir Fabert




Vladimir
Fabert, Chief Executive Officer




June 2, 2008