<PAGE>

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                 ---------------

                                    FORM 10-Q

(MARK ONE)

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

For the quarterly period ended July 31, 2001 or

[  ]     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
         EXCHANGE ACT OF 1934

Commission file number 1-10366


                          LASER RECORDING SYSTEMS, INC.
             (Exact name of registrant as specified in its Charter)

                  NEW JERSEY                                22-2582847

        (State or Other Jurisdiction of                  (I.R.S. Employer
        Incorporation or Organization)                  Identification No.)

             1359 New York Avenue
         Huntington Station, New York                          11746
   (Address of Principal Executive Offices)                 (Zip Code)

                                 (800) 786-1352
              (Registrant's Telephone Number, Including Area Code)


Check whether the registrant (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act of 1934 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 [ ]

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date: 10,000,000 shares of the
Company's Common Stock, $.001 par value, were outstanding as of September 14,
2001.



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Item 1 Financial Statements

                                   LASER RECORDING SYSTEMS, INC.
                                           BALANCE SHEET


<TABLE>
<CAPTION>
                               ASSETS
                                                                          July 31, 2001      January 31, 2001
                                                                          -------------      ----------------
<S>                                                                        <C>                 <C>
CURRENT ASSETS:
Cash and Cash Equivalents                                                  $       991         $     2,023
                                                                           -----------         -----------
    Total Current Assets                                                   $       991         $     2,023
                                                                           -----------         -----------
        Total Assets                                                       $       991         $     2,023
                                                                           -----------         -----------

                               LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accrued Expenses                                                                    --         $       200
                                                                           -----------         -----------
         Total Current Liabilities                                                  --         $       200
Loan Payable -- Officer                                                    $    20,000         $    16,000
                                                                           -----------         -----------
    Total Current Liabilities                                              $    20,000         $    16,200
                                                                           -----------         -----------

Stockholders' Equity
Common Stocks - 10,000,000 shares authorized,
10,000,000 issued and outstanding
                                                                             7,408,910         $ 7,408,910
 Paid-in Capital                                                                 1,400               1,400
Retained Earnings                                                           (7,429,319)         (7,424,487
                                                                           -----------         -----------
        Total Stockholders' Equity                                         $   (19,009)        $   (14,177)
                                                                           -----------         -----------
Total Liabilities and Stockholders' Equity                                 $       991         $     2,023
                                                                           -----------         -----------

</TABLE>

    The accompanying notes are an integral part of the financial statements.

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                          LASER RECORDING SYSTEMS, INC.
              STATEMENT OF REVENUES, EXPENSES AND RETAINED EARNINGS

<TABLE>
<CAPTION>
                                                    Three Months Ended                 Six Months Ended
                                                          July 31                          July 31
                                              -----------------------------     ------------------------------
                                                   2001              2000             2001           2000
                                                   ----              ----             ----           ----
<S>                                           <C>              <C>              <C>              <C>
Revenues:

Interest Income                               $         --     $         --     $         --     $          9
                                              ------------     ------------     ------------     ------------

     Total Revenues                           $         --     $         --     $         --     $          9
                                              ------------     ------------     ------------     ------------


Expenses:

Administrative Expenses                       $      2,307     $      6,796     $      4,778     $      8,677
Directors Fees                                          --            1,400               --            1,400
Taxes                                                   --            5,419               54            5,469
                                              ------------     ------------     ------------     ------------
Total Expenses                                $      2,307     $     13,615     $      4,832     $     15,546
                                              ------------     ------------     ------------     ------------
Net Loss                                      $     (2,307)    $    (13,615)    $     (4,832)    $    (15,537)
                                              ------------     ------------     ------------     ------------
Net loss per share                            $      (0.00)    $      (0.00)    $      (0.00)    $      (0.00)
Shares used in computing net loss per share     10,000,000       10,000,000       10,000,000       10,000,000
</TABLE>


    The accompanying notes are an integral part of the financial statements.




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                          LASER RECORDING SYSTEMS, INC.
                             STATEMENT OF CASH FLOWS
                            For the Six Months Ended
                                     July 31

<TABLE>
<CAPTION>
                                                              2001            2000
                                                           --------         --------
<S>                                                        <C>              <C>
Cash flows from operating activities:
Net Loss                                                   $     --         $     --
                                                           --------         --------

Cash flows from financing activities:
Loan from Shareholder                                         4,000           10,000
Capital Contribution                                                           1,400
Accrued Expenses                                               (200)            (150)
Maintaining the Corporate Entity                             (4,833)         (15,537)
                                                           --------         --------
Net cash provided by (used in) financing activities        $ (1,033)        $ (4,287)
                                                           --------         --------


Increase (Decrease) in Cash                                $ (1,033)        $ (4,287)
                                                           --------         --------
Cash -- Beginning of Period                                   2,024            6,634
                                                           --------         --------
Cash -- End of Period                                      $    991         $  2,347
                                                           ========         ========
</TABLE>

        The accompanying notes are an integral part of the financial statements.



<PAGE>


                          LASER RECORDING SYSTEMS INC.
                        NOTES TO THE FINANCIAL STATEMENTS
                               AS OF JULY 31, 2001

GENERAL

Laser Recording Systems, Inc. (the Company) was organized in 1985 as the
successor to several other businesses by the original founder. In 1988, Poly
Ventures, Limited Partnership held approximately 70% of the outstanding voting
shares and maintained a controlling interest in the Company until 1998. In 1998
several investors acquired the remaining interest from Poly Ventures.

The Company ceased operations and laid off all its employees on August 16, 1993.

BASIS OF PRESENTATION

The accompanying financial statements have been prepared in conformity with
generally accepted accounting principles and reflect all adjustments, which in
the opinion of management are necessary for a fair presentation of the results
for the periods shown. The results of operations for such periods are not
necessarily indicative of the results expected for the full fiscal year or for
any future period.


Note 1

As of the date of the financial statements, all 10,000,000 shares of the Company
were issued and outstanding. In addition, the officers hold 1,800,000 of
warrants which they received for future services. If the warrants are exercised,
the Company will have to buy back its stock on the open market.

Note 2

The Company discontinued operation on August 16, 1993, however the Company
maintained certain functions to continue the existence of the Corporation.
Stockholders services and maintaining of records were handled on an ongoing
basis. For financial statement purposes all revenues and expenses are considered
non-operating transactions from February 1, 1994 to the present.


<PAGE>



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

Results of Operations

The Company has no sources of revenue. Expenses reflect only the minimum cost of
maintaining the Company's operations and miscellaneous expenses associated with
seeking a merger partner. In view of these limited operations, management does
not believe that a comparison of specific line items from period to period it
would be meaningful.

Liquidity and Capital Resources

The Company's financial statements have been prepared assuming that it will
continue as a going concern. As shown in the consolidated financial statements,
at July 31, 2001 the Company had total assets of $991 and an accumulated deficit
of $7,429,319 . The Company obtains its entire financial support from loans from
the Company's majority shareholder, and it is likely that additional loans from
that shareholder will be necessary if the Company is to pursue its plans to
merge with an operating enterprise. These factors, among other things, raise
substantial doubt about its ability to continue as a going concern. The
consolidated financial statements do not include any adjustments relating to the
recoverability and classification of recorded asset amounts or the amounts or
classification of liabilities that might be necessary should the Company be
unable to continue in operation.


<PAGE>



PART II -- OTHER INFORMATION

Item 5.           Other Information

         N/A

Item 6.           Exhibits and Reports on Form 8-K

         N/A


                                   SIGNATURES

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


                                    LASER RECORDING SYSTEMS, INC.
                                    (Registrant)

Date: September 14, 2001
                                    /s/ Walter Hinchcliffe
                                    ------------------------------------------
                                    Walter Hinchcliffe
                                    President

Date: September 14, 2001
                                    /s/ Carl Lanzisera
                                    ------------------------------------------
                                    Carl Lanzisera
                                    Chief Financial Officer
                                    (Principal Financial and Accounting Officer)