SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, D.C. 20549

                                    FORM 10-QSB


                 Quarterly Report under Section 13 or
                 15(d) of the Securities Exchange Act     X
                 of 1934 for the quarterly period
                 ended June 30, 1998

                                Or

                 Transition Report under Section 13
                 or 15(d) of the Securities Exchange
                 Act of 1934 for the transition
                 period from _________ to ___________


                Commission File Number 33-32341-D

                  WORLDPORT COMMUNICATIONS, INC.
 (Name of Small Business Registrant as Specified in its Charter)


 Delaware                                          84-1127336        
 (State or other jurisdiction of           (IRS Employer ID Number)
  incorporation of organization)

  1825 Barrett Lakes Center.,  
   Suite 100, Kennesaw, Georgia                      30144     
 (Address of principal executive                   (Zip Code)
         offices)

                                 (770) 792-8735
                          Registrant's telephone number


     Check whether the issuer (1) filed all reports required to be filed by
     Section 13 or 15(d) of the Securities 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  [    ]




     As of August 7, 1998, the Registrant had 18,096,485 shares of Common Stock
     par value $0.0001 outstanding.


                  Transitional Small Business Disclosure Format
                                  (Check one):

                             Yes [   ]      No [ X ]




                WORLDPORT COMMUNICATIONS, INC. AND SUBSIDIARIES
                              TABLE OF CONTENTS

                                                                           Page

PART I - FINANCIAL INFORMATION

            Item  Financial Statements
            1.

                  Condensed Consolidated Balance Sheets as of 
                  June 30, 1998 and December 31, 1997   . . . . . . . .   3
                  . . . . . . . . . . . . . . . . . . . . . . . . . . .
                  . . . 

                  Condensed Consolidated Statements of Operations 
                  for the Three and Six Months Ended June 30, 
                  1998 and 1997  . . . . . . . . . . . . . . . . . . .    4
                  . . . . . . . . . . . . . . . . . . . . . . . . . . .
                  . . . . . . . . . . . . .  

                  Condensed Consolidated Statements of Cash Flows
                  for the Six Months Ended June 30, 1998 and 1997 . . .   5
                  . . . . . . . . . . . . . . . . . . . . . . . . . . .
                  .

                  Notes to Condensed Consolidated Financial Statements    6
                  . . . . . . . . . . . . . . . . . . . . . . . . . . .

            Item  Management's Discussion and Analysis of 
            2.    Financial Condition and Results of Operations   . . .   9
                  . . . . . . . . . . . . . . . . . . . . . . . . . . .
                  . . . 


PART II - OTHER INFORMATION

            Item  Legal Proceedings  . . . . . . . . . . . . . . . . .   18
            1.    . . . . . . . . . . . . . . . . . . . . . . . . . . .
                  . . . . . . . . . . . . 

            Item  Changes in Securities . . . . . . . . . . . . . . . .  18
            2.    . . . . . . . . . . . . . . . . . . . . . . . . . . .
                  . . . . . . . . . . . 

            Item  Defaults Upon Senior Securities  . . . . . . . . . .   19
            3.    . . . . . . . . . . . . . . . . . . . . . . . . . . .
                  . . . . . . . . 

            Item  Submission of Matters to a Vote of Security Holders    19
            4.    . . . . . . . . . . . . . . . . . . . . . . . . . . .
                  . .

            Item  Other Information  . . . . . . . . . . . . . . . . .   19
            5.    . . . . . . . . . . . . . . . . . . . . . . . . . . .
                  . . . . . . . . . . . . 

            Item  Exhibits and Reports on Form 8-K  . . . . . . . . . .  19
            6.    . . . . . . . . . . . . . . . . . . . . . . . . . . .
                  . . . . . .  


SIGNATURE                                                           21


                         PART I   FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

<TABLE>
WORLDPORT COMMUNICATIONS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
<CAPTION>

                                                                ASSETS  
                                                                                                        
                                                                                             June 30,              December 31,
                                                                                                  1998                 1997       
                                                                                                            
                                                                                                         
                                                                                              (Unaudited)
             CURRENT ASSETS:
                  <S>                                                                            <C>                    <C>       
                  Cash and cash equivalents                                                      $ 11,122,000            $ 179,271
                  Accounts receivable, net of allowance for doubtful accounts 
                        of $362,160 and $14,610 respectively                                        4,443,938              368,848
                  Prepaid expenses  and other current assets                                        7,814,054               67,438
                                 Total current assets                                              23,379,992              615,557
             PROPERTY AND EQUIPMENT, net                                                           68,363,124            5,031,858

             OTHER ASSETS:
                  Intangibles, net                                                                 72,423,175            6,292,411
                  Other assets, net                                                                10,426,226            1,257,451
                                 TOTAL ASSETS                                                   $ 174,592,517         $ 13,197,277

                                                  LIABILITIES AND STOCKHOLDERS' EQUITY

             CURRENT LIABILITIES:
                  Accounts payable                                                             $ 14,072,239             $1,391,519
                  Accrued expenses                                                                8,254,092              1,292,261
                  Short-term note payable                                                           552,265                500,000
               Bridge loan facility                                                             106,266,976              -        
                  Current portion of notes payable   related parties                                175,000                540,000
                  Current portion of obligations under capital leases                             1,637,894                936,992
                  Other current liabilities                                                       2,657,905                 97,527
                                 Total current liabilities                                      133,616,371              4,758,299

             NOTES PAYABLE   RELATED PARTIES, net of current portion                              -                    1,191,250  
             LONG-TERM OBLIGATIONS UNDER CAPITAL LEASES, net of current portion                  14,608,028              3,005,894

             OTHER LONG-TERM LIABILITIES                                                            949,844                 86,584
             COMMITMENTS AND CONTINGENCIES (Note 4)

             STOCKHOLDERS' EQUITY
                  Undesignated preferred stock, $0.0001 par value, 6,250,000 shares
                     authorized,  no shares issued and outstanding                                 -                             _
                  Series A preferred stock, $0.0001 par value, 750,000 shares
                     authorized, 493,889 shares issued and outstanding in 
                     1998 and 1997                                                                       49                ____49_
                  Series B preferred stock, $0.0001 par value, 3,000,000 shares
                     authorized, 2,962,687 and no shares issued and outstanding in
                     1998 and 1997, respectively                                                        296           -         _ 
                  Common stock, $0.0001 par value, 65,000,000 shares authorized,
                     17,079,965 and 16,033,333 shares issued and outstanding, in 
                     1998 and 1997, respectively                                                      1,708                1,603  
               Warrants                                                                          13,965,787           -           
                  Additional paid-in capital                                                     27,073,670             7,953,631_
                  Amounts due from stockholders                                                   (2,286,426)         -         _ 
                  Cumulative translation adjustment                                                 (302,110)         -         _ 
               Unamortized compensation expense                                                     (755,857)
                  Accumulated deficit                                                            (12,278,843)          (3,800,033)
                                 Total stockholders' equity                                      25,418,274             4,155,250_
                                 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                   $ 174,592,517          $ 13,197,277_

   The accompanying notes are an integral part of these consolidated financial
                                   statements.


</TABLE>

<TABLE>

                 WORLDPORT COMMUNICATIONS, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)

<CAPTION>



                                                                       Three Months Ended                 Six Months Ended
                                                                                   June 30                           June 30      
                                                                                                                      
                                                                     1998             1997             1998             1997  

             <S>                                                 <C>                <C>             <C>               <C>        
             REVENUES                                            $ 1,715,505        $ 188,549      $ 2,663,693        $ 188,549  

             COST OF SERVICES                                      1,616,675          194,412        2,507,486          194,412  
                                                                              
                  Gross margin                                        98,830           (5,863)         156,207           (5,863) 

             OPERATING EXPENSES:
                  Selling, general and 
                     administrative expenses                       3,996,909         363,679         6,252,079          652,648  
                  Depreciation and amortization                      865,936          29,770         1,497,162           29,770  

                  Operating loss                                   (4,764,015)      (399,312)        (7,593,034)       (688,281) 

             OTHER INCOME (EXPENSE):
                  Interest income                                     35,641          29,827            35,641           59,786  
                  Interest expense                                   (700,658)        (5,741)          (876,966)         (9,025) 
                                                                     (665,017)        24,086           (841,325)         50,761  

             NET LOSS                                            $ (5,429,032)     $ (375,226)     $ (8,434,359)     $ (637,520) 

             BASIC AND DILUTED NET LOSS PER SHARE                   $            $       (0.03)       $            $       (0.06)
                                                                        (0.32)                            (0.51)

             WEIGHTED AVERAGE 
                  SHARES OUTSTANDING                                16,828,927       11,185,532       16,401,686       10,377,763



   The accompanying notes are an integral part of these consolidated financial
                                   statements.

</TABLE>

<TABLE>


                 WORLDPORT COMMUNICATIONS, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                               (Unaudited)

<CAPTION>
                                                                                            Six Months Ended
                                                                                                   June 30,      
                                                                                           
                                                                                            1998             1997      
                                                                                                             
<S>                                                                                    <C>              <C>  
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss                                                                               $ (8,434,359)    $     (637,520)
Adjustments to reconcile net loss to net cash 
     used by operating activities - 
          Depreciation and amortization                                                   1,497,162             29,770  
    Amortization of warrants                                                                262,763             -         
          Compensation charge                                                               587,271             -         
          (Increase) decrease in accounts receivable                                       (391,896)            10,614  
          (Increase) in prepaid expenses and other assets                                  (477,226)           (84,480)
          Increase in accounts payable and accrued 
               expenses and other liabilities                                               666,297             21,797  
                    Net cash used in operating activities                                (6,289,988)          (659,819)

CASH FLOWS FROM INVESTING ACTIVITIES:
          Cash paid in connection with acquisitions                                    (113,949,890)        (1,178,000)
          Issuance of notes receivable                                                    -                   (100,000)
          Collection of notes receivable                                                  -                  1,108,333  

    Deposits paid in conjunction with new business alliances                             (1,237,500)           -          
          Capital expenditures                                                             (126,086)          (68,620)
                                                                                                         

                    Net cash used in investing activities                              (115,313,476)         (238,287)

CASH FLOWS FROM FINANCING ACTIVITIES:
    Proceeds from bridge loan                                                           120,000,000            -          
    Principal payments on note payable   related party                                     (365,000)           -          
    Principal payments on short-term debt                                                  -                 (262,278)

    Payments on obligations under capital leases                                          (497,528)            -       
    Proceeds from issuance of preferred stock                                           12,508,721              -       
    Proceeds from issuance of common stock, net of offering expenses                       900,000             12,250  

                    Net cash provided by financing activities                          132,546,193           (250,028)

NET INCREASE (DECREASE) IN CASH                                                          10,942,729            (1,148,134)

CASH AND CASH EQUIVALENTS, beginning of the period                                          179,271            1,552,829  
CASH AND CASH EQUIVALENTS, end of the period                                           $ 11,122,000       $      404,695  

CASH PAID DURING THE PERIOD FOR INTEREST                                              $      378,546      $       26,989 


CASH PAID DURING THE PERIOD FOR INCOME TAXES                                          $         -      $         -        
                                                                                          
SUPPLEMENTAL SCHEDULE OF NON-CASH 
INVESTING AND FINANCING ACTIVITIES:

          Conversion of note payable for 1,680,000 shares of common stock             $        -           $     420,000 
                                                                                                                 
          Conversion of notes payable   related parties and accrued interest for
             230,627 shares of Series B preferred stock                               $   1,236,165        $         -        
                                                                                                         
          Issuance of 250,000 shares of Series B preferred stock for notes            $   1,017,500        $         -        
             receivable                                                                                                         
          Stock issued in ICX acquisition                                             $     536,000        $         -        
                                                                                                    
          Assets acquired under capital lease                                         $   1,985,564        $         -        
                                                                                                       

The accompanying notes are an integral part of these consolidated financial
statements.

</TABLE>


                 WORLDPORT COMMUNICATIONS, INC. AND SUBSIDIARIES

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)


(1)  ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization and Basis of Presentation

     WorldPort Communications, Inc. and subsidiaries (the "Company") is a
     global, facilities-based telecommunications services provider offering a
     full range of voice and value-added services to carriers and corporate
     customers worldwide. The Company is focusing on expanding its network
     infrastructure in the United States and in major markets in Europe, Asia-
     Pacific and Latin America.  

     The accompanying condensed consolidated financial statements have been
     prepared by the Company without audit pursuant to the rules and regulations
     of the Securities and Exchange Commission.  Certain information and
     footnote disclosures normally included in financial statements prepared in
     accordance with generally accepted accounting principles have been
     condensed or omitted in this Form 10-QSB pursuant to such rules and
     regulations; however, management believes that the disclosures herein are
     adequate to make the information presented not misleading.  The financial
     statements and notes thereto included in this Form 10-QSB should be read in
     conjunction with the financial statements and notes thereto included in the
     Company's Annual Report on Form 10-KSB for the year ended December 31,
     1997.

     In the opinion of the Company's management, the accompanying condensed
     consolidated financial statements contain all adjustments necessary to
     present fairly the Company's financial position as of June 30, 1998, and
     the results of operations for the three and six months ended June 30, 1998
     and 1997 and cash flows for the six months ended June 30, 1998 and 1997. 
     The results of operations for the three and six months ended June 30, 1998
     and 1997 are not necessarily indicative of the operating results for the
     full years.

Financial Condition

     The Company is subject to various risks in connection with the operation of
     its business including, among other things, (i) changes in external
     competitive market factors, (ii) termination of certain operating
     agreements or inability to enter into additional operating agreements,
     (iii) inability to satisfy anticipated working capital or other cash
     requirements, (iv) changes in or developments under domestic or foreign
     laws, regulations, licensing requirements or telecommunications standards,
     (v) changes in the availability of transmission facilities, (vi) changes in
     the Company's business strategy or an inability to execute its strategy due
     to unanticipated changes in the market, (vii) various competitive factors
     that may prevent the Company from competing successfully in the
     marketplace, (viii) the Company's lack of liquidity and its ability to
     raise additional capital, (ix) loss of services of key executive officers
     and (x) loss of a customer which provides significant revenues to the
     Company.  During 1997, the Company's first year of operations as an
     international telecommunications services provider, the Company incurred
     losses of approximately $3.5 million.  For the six months ended June 30,
     1998, the Company incurred losses of approximately $8.4 million and expects
     to continue to incur operating losses in the near future and has an
     accumulated deficit of approximately $12.3 million as of June 30, 1998 as
     well as a working capital deficit of approximately $110.2 million.  Funding
     of the Company's working capital deficit, current and future operating
     losses and expansion of the Company will require substantial continuing
     capital investment.  The Company's strategy is to fund these cash
     requirements through debt facilities and additional equity financing. 
     Although the Company has been able to arrange debt facilities or equity
     financing to date, there can be no assurance that sufficient debt or equity
     financing will continue to be available in the future or that it will be
     available on terms acceptable to the Company.  Failure to obtain sufficient
     capital could materially affect the Company's acquisition and operating
     strategies. 

     During June 1998 the Company obtained $120 million in interim financing
     (the "Interim Loan") for purposes of completing the acquisition of EnerTel
     N.V. ("EnerTel"). During 1998, the Company raised approximately $13.5
     million and $1 million in connection with the sale of its Series B
     convertible preferred stock and common stock, respectively (see Note 5) and
     converted approximately $1.2 million in notes payable to related parties
     into its Series B convertible preferred stock.  The Company also increased
     its existing lease financing facility to provide up to $30,000,000 in
     infrastructure financing.  The Company has not made any of its scheduled
     payments on its $500,000 debt obligation to Value Partners, Ltd. ("Value
     Partners").  The Company is currently renegotiating this debt obligation,
     and has reached tentative agreement with Value Partners on revised terms. 

     Consolidation

     The accompanying consolidated financial statements include the accounts of
     the Company and its wholly owned subsidiaries.  All significant
     intercompany accounts and transactions have been eliminated.

(2)  LOSS PER SHARE

     The Company adopted SFAS No. 128, "Earnings Per Share" in 1997. For all
     periods presented, basic and diluted earnings per share are the same as any
     dilutive securities had an antidilutive effect on earnings per share.

(3)  ACQUISITIONS

     In April 1998, the Company acquired the telecommunications assets and
     operations of InterContinental Exchange, Inc. ("ICX"), a licensed provider
     of international telecommunications services headquartered in the San
     Francisco Bay area, in exchange for 400,000 shares of the Company's common
     stock.   200,000 shares are being held in escrow for a period of eighteen
     months following the closing subject to the attainment of certain future
     revenue requirements and to indemnify the Company for certain
     representations and warranties.

     In June 1998, the Company acquired EnerTel N.V.,  which holds a national
     infrastructure license and operates a telcommunications network in The
     Netherlands for consideration of 186 million Dutch guilders (approximately
     $92 million) and the repayment of certain Enertel indebtedness of
     approximately $17 million.  The company has agreed to sell, in transactions
     expected to close in August 1998, a 15% interest in Enertel to former
     shareholders of Enertel for approximately $13.5 million. Beginning in 1996,
     EnerTel deployed a nationwide backbone fiber optic network utilizing fiber
     optic capacity leased from its consortium members in order to provide
     domestic and international long distance services to business and
     residential customers in The Netherlands.  EnerTel operates a network
     backbone of approximately 1,100 km of fiber optic cable.  Additionally,
     EnerTel has interconnection and service agreements with KPN Telecom, Global
     One Communications B.V., Belgacom S.A., and Cable & Wireless, plc, that
     provide EnerTel with direct termination services in Germany, Belgium, and
     the United Kingdom.  The Company anticipates selling a portion of the Bel
     1600 division of EnerTel, which provides indirect access services to
     residential subscribers, during 1998.

     Both acquisitions were accounted for under the purchase method of
     accounting.  The purchase price was allocated to the underlying assets
     purchased and liabilities assumed based on their estimated fair market
     values at acquisition date.

     The following table summarizes the net assets purchased in connection with
     the acquisitions and the amount attributable to cost in excess of net
     assets acquired (in thousands):

<TABLE>
<CAPTION>

                                                 EnerTel             ICX
 <S>                                         <C>              <C>
 Working capital                              $    (541)        $    (58)
 Property, plant, and equipment                  61,975              169
 Other assets                                       930               28
 Non-current liabilities                        (11,696)             (39)
 Customer base                                        0              472
 Goodwill                                        66,117                0

</TABLE>

     The preliminary estimate of net assets acquired represents management's
     best estimate based on currently available information; however, such
     estimate may be revised up to one year from the acquisition date.  Customer
     bases will be amortized over 5 years and the goodwill will be amortized
     over 20 years.

     In May 1998, the Company entered into a definitive agreement (subsequently
     modified in July 1998) for the acquisition of International InterConnect,
     Inc. ("IIC"). IIC specializes in providing international long distance
     services primarily to Latin America.  Additionally, IIC is now initiating
     international private line services.  IIC's services are marketed through
     international distributors primarily in Latin America. The acquisition
     closed in July 1998. The purchase consideration was 772,727 shares of the
     Company's common stock, of which 38,500 are held in escrow, and $750,000
     cash plus net working capital at closing (to be settled in shares). 
  
     In May 1998, the Company entered into a definitive agreement (subsequently
     modified in July 1998) for the acquisition of all of the issued and
     outstanding capital stock of All AmericaCables and Radio, Inc., ("AACR")
     for consideration of $31.5 million, 300,000 shares of the Company's common
     stock and repayment of AACR indebtedness of approximately $12 million. The
     shares will be delivered into escrow to secure the indemnification
     obligations of the former AACR shareholders under the acquisition documents
     for a period of one-year following the closing. AACR is a licensed public
     telephone operator in the Dominican Republic as well as a provider of
     international long distance, leased line, microwaves, satellite, telex and
     wireless services in the Dominican Republic. Additionally, AACR holds a
     license to provide PCS services, for which the Company anticipates building
     out a network during the next twelve months. The acquisition is expected to
     close in the third quarter of 1998. 
      
     In June 1998, the Company entered into a definitive agreement for the
     acquisition of the outstanding capital stock of Campuslink Communication
     Systems, Inc. ("Campuslink") for consideration of $15 million in cash, 
     2,000,000 shares of the Company's common stock and warrants exercisable for
     1,000,000 shares of the Company's common stock at $4 per share. Campuslink
     provides design, installation, and management of integrated
     telecommunications systems to colleges, universities, and other
     institutional campuses. The acquisition is expected to close in the third 
     quarter of 1998.


(4)  COMMITMENTS AND CONTINGENCIES

     Employment Agreements

     As of April 1, 1998, the Company amended its employment agreements with two
     executives who were previously granted the right to purchase a total of
     1,000,000 shares of common stock.  As a result of these amendments, the
     executives will purchase 250,000 shares of Series B preferred stock at
     $5.36 per share which is the fair value of the stock at that date.  In
     connection with the purchase of these shares, the executives executed 24-
     month non-recourse promissory notes in the aggregate amount of $1,017,500
     secured by pledges of the stock purchased.  The promissory notes accrue
     interest at an annual rate of 9%, with monthly payments of principal and
     accrued interest beginning September 1, 1998.

     Bridge Loan Facility

     To finance the EnerTel acquisition, the Company entered into a $120 million
     bridge loan facility with a consortium of banks effective June 23, 1998,
     the terms of which also included the issuance of warrants exercisable for
     1,644,969 shares of common stock at a price per share of $0.01.   The fair
     market value of these warrants ($14.0 million) is reflected as a reduction
     in the principal amount of the notes.  This amount is being amortized to
     interest expense over the life of the loan (1 year).  At such time as the
     facility is repaid, the remaining unamortized portion of the value of the
     warrants will be expensed.  The bridge loan, which matures on June 23,
     1999, includes certain negative and affirmative covenants and is secured by
     a lien on substantially all of the assets of the Company and certain of its
     subsidiaries and a pledge of the capital stock of certain of the Company's
     subsidiaries. It is anticipated that this facility will be repaid with a
     portion of the proceeds of a current offering of Units, consisting of
     Senior Notes and attached Warrants, that is expected to close in the third
     quarter of 1998 (the "Offering").  The remaining proceeds will be utilized
     to pay the cash portion of the aforementioned pending acquisitions as well
     as meet a portion of the capital expenditure requirements associated with
     the Company's network build-out and working capital needs. See Management's
     Discussion and Analysis   Liquidity and Capital Resources for further
     discussion.


(5)  STOCKHOLDERS' EQUITY     

     During 1998, the Company raised approximately  $13.5 million, of which
     approximately $12.5 million was received as of June 30, 1998, in  a private
     placement offering of its par value $0.0001 Series B convertible preferred
     stock at $5.36 per share.  The Series B Convertible Preferred Stock is
     convertible into shares of the Company's common stock at any time at the
     option of the holder at a rate of 4 shares of common stock for each share
     of preferred stock.  Holders of Series B convertible preferred stock have
     voting rights equal to 40 votes per share on all matters submitted to a
     vote of the stockholders of the Company.  

     In May 1998, the Company sold 180,000 shares of its common stock at a price
     of $5.00 per share to an accredited investor in private placement
     transaction.

      

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

Note on "Forward-Looking" Statements

     The information set forth in Management's Discussion and Analysis of
     Financial Condition and Results of Operations ("MD&A")  contains certain
     "forward-looking statements" within the meaning of Section 27A of the
     Securities Act of 1933, as amended, Section 21E of the Securities Act of
     1934, as amended, and the Private Securities Litigation Reform Act of 1995,
     including, among others (i) expected changes in the Company's revenues and
     profitability (ii) prospective business opportunities and (iii) the
     Company's strategy for expanding its business.  Forward-looking statements
     are statements other than historical information or statements of current
     condition.  Some forward-looking statements may be identified by use of
     terms such as "believes", "anticipates", "intends" or "expects".  These
     forward-looking statements relate to the plans, objectives and expectations
     of WorldPort Communications, Inc. and subsidiaries (the "Company") for
     future operations.  Although the Company believes that its expectations
     with respect to the forward-looking statements are based upon reasonable
     assumptions within the bounds of its knowledge of its business and
     operations, in light of the risks and uncertainties inherent in all future
     projections, the inclusion of forward-looking statements in this report
     should not be regarded as a representation by the Company or any other
     person that the objectives or plans of the Company will be achieved.  


     The Company's revenues and results of operations could differ materially
     from those projected in the forward-looking statements as a result of
     numerous factors, including, but not limited to, the following:  (i)
     changes in external competitive market factors, (ii) termination of certain
     operating agreements or inability to enter into additional operating
     agreements, (iii) inability to satisfy anticipated working capital or other
     cash requirements, (iv) changes in or developments under domestic or
     foreign laws, regulations, licensing requirements or telecommunications
     standards, (v) changes in the availability of transmission facilities, (vi)
     changes in the Company's business strategy or an inability to execute its
     strategy due to unanticipated changes in the market, (vii) various
     competitive factors that may prevent the Company from competing
     successfully in the marketplace, (viii) the Company's lack of liquidity and
     its ability to raise additional capital, (ix) loss of services of key
     executive officers and (x) loss of a customer which provides significant
     revenues to the Company.  In light of these risks and uncertainties, there
     can be no assurance that actual results, performance or achievements of the
     Company will not differ materially from any future results, performance or
     achievements expressed or implied by such forward-looking statements.  The
     foregoing review of important factors should not be construed as
     exhaustive.  The Company undertakes no obligation to release publicly the
     results of any future revisions it may make to forward-looking statements
     to reflect events or circumstances after the date hereof or to reflect the
     occurrence of unanticipated events.

     The following discussion should be read in conjunction with the Condensed
     Consolidated Financial Statements and Notes thereto included under Item 1
     of this Form 10-QSB.  In addition, reference should be made to the
     Financial Statements and Notes thereto and related Management's Discussion
     and Analysis of Financial Condition and Results of Operations included in
     the Company's Annual Report on Form 10-KSB for the year ended December 31,
     1997.

     Overview

     WorldPort is a rapidly growing facilities-base multinational
     telecommunications carrier focused on providing a broad range of
     international telecommunications services to carriers, distributors and
     resellers, large multinational corporations and Internet service providers
     ("ISPs") worldwide. WorldPort positions itself as a next generation
     carrier's carrier, utilizing advanced technologies on unified global
     switching and transmission platforms to provide least-cost
     interconnectivity and high bandwidth capacity for voice, data, video,
     Internet and other telecommunications services. The Company's initial
     geographical focus is on high-traffic routes within and between Europe, the
     Americas and Asia. WorldPort is currently deploying an advanced high
     capacity global network consisting of (i) indefeasible rights of use
     ("IRUs") it has committed to purchase on major undersea fiber optic cable
     systems, (ii) international gateway switches to be deployed through its
     turn-key agreement with Nortel and (iii) IP switching and intelligent
     network equipment to be deployed through its turn-key agreement with
     Lucent. The Company's global network is complemented by relationships and
     operating, interconnection and terminating agreements with other carriers
     including SITA EQUANT  S.C. ("EQUANT'). 

     Because of the recent acquisitions of EnerTel, ICX and IIC, the pending
     acquisitions of AACR and CampusLink, and the expected substantial increase
     in the Company's capital resources upon completion of the Offering, the
     Company's future operating results are anticipated to be significantly
     different from its current results.

     The Company was originally organized as a Colorado corporation under the
     name Sage Resources, Inc. in January 1989 to evaluate, structure and
     complete mergers with, or acquisitions of, other companies. The Company
     remained inactive until 1996 when it was acquired by its current
     management, which changed the Company's domicile to Delaware and its name
     to WorldPort Communications, Inc. 
      
     The Company primarily operates through a number of operating subsidiaries
     that it has acquired in the United States, Latin America and Europe. The
     acquisitions completed by the Company to date and those pending are
     described below. 

      
     Completed Acquisitions
      
     On June 20, 1997, the Company completed the acquisition  of substantially
     all of the telecommunications assets and operations of Telenational
     Communications Limited Partnership ("TNC"), a Nebraska limited partnership,
     pursuant to an Asset Purchase Agreement dated April 23, 1997, as amended.
     The results of operations of TNC are included in the consolidated financial
     statements of the Company from the date of acquisition. The assets and
     operations of TNC were purchased in exchange for (i) 3,750,000 shares of
     common stock and (ii) the assumption by the Company of certain indebtedness
     of TNC up to a maximum of $4.5 million. The purchased assets include
     telecommunications switches and other network equipment, customer and
     vendor contracts, an FCC section 214 common carrier license, an operator
     services center and other assets sufficient to continue the ongoing
     business of TNC. The FCC section 214 common carrier license gives the
     Company the authority to resell both international switched and private
     line services of authorized carriers. 
      
     On July 3, 1997, the Company merged The Wallace Wade Company ("WWC"), a
     Texas corporation, into a wholly-owned subsidiary of the Company pursuant
     to an Agreement and Plan of Merger dated April 20, 1997. WWC was a
     telecommunications marketing consulting firm which produced and implemented
     marketing strategies for clients ranging from small companies to large
     corporate clients. The Company's former resident and Chief Executive
     Officer was the sole shareholder of WWC. In connection with the WWC
     acquisition, the Company agreed to deliver (i) 1,200,000 shares of common
     stock, (ii) $75,000 in cash and (iii) a promissory note in the amount of
     $175,000.  WWC's operating revenues and expenses did not have a material
     impact on the operating revenues and expenses of the Company in fiscal
     1997. The Company valued the stock issued in connection with the TNC and
     WWC acquisitions based on the price received by the Company in connection
     with its private placement of common stock which closed in March 1997.
      
      
     In February 1998, the Company commenced operations in The Netherlands
     through the acquisition of all of the outstanding capital stock of MathComp
     B.V. ("MathComp"). The Company changed the name of MathComp to WorldPort
     Communications Europe, B.V. ("WorldPort Europe"). In connection with this
     acquisition, the Company issued 150,000 shares of the common stock and paid
     $250,000 in cash. The former shareholder of MathComp is eligible to earn an
     additional 2,350,000 shares of common stock contingent upon the attainment
     of certain future revenue and gross margin requirements during the first
     and second quarters of 1999. In connection with the acquisition, the
     Company entered into a three-year employment agreement with the former
     shareholder of MathComp at an annual salary of approximately $90,000. 
      
     In April 1998, the Company acquired the telecommunications assets and
     operations of ICX, a licensed provider of international telecommunications
     services headquartered in the San Francisco Bay area in exchange for
     400,000 shares of the common stock (of which 200,000 shares are held
     pursuant to an escrow agreement for a period of eighteen months following
     the closing subject to the attainment of certain future revenue
     requirements and to indemnify the Company for certain representations and
     warranties). 
      
     In June 1998, the Company acquired ownership of EnerTel, which holds a
     national infrastructure license and operates a telecommunications network
     in the Netherlands, for consideration consisting of approximately $92
     million and the payment of certain EnerTel indebtedness of approximately
     $17 million. The Company has agreed to sell, in transactions expected to
     close in August 1998, a 15% interest in EnerTel to former shareholders of
     EnerTel for approximately $13.5 million. Beginning in 1996, EnerTel
     deployed a nationwide backbone fiber optic network utilizing fiber capacity
     leased from its consortium members in order to provide domestic and
     international long distance services to business and residential customers
     in the Netherlands. EnerTel operates a network backbone of approximately
     1,100 kilometers of fiber optic cable. Additionally, EnerTel has
     interconnection and service agreements with KPN Telecom, Deutsche Telekom,
     Belgacom S.A., and Cable & Wireless, plc, that provide EnerTel with direct
     termination services in The Netherlands, Germany, Belgium, and the United
     Kingdom. During 1997, EnerTel's principal source of revenue was indirect
     access services provided by its Bel 1600 division to small and medium size
     business and residential subscribers. As part of the Company's strategy to
     refocus EnerTel's business on high volume carrier and business services,
     the Company anticipates selling the residential portion of the Bel 1600
     division. The Company expects, as a condition of such sale, to retain on a
     wholesale basis the traffic minutes generated by the residential
     subscribers. The disposition is expected to improve operating margins as a
     result of a reduction in related sales and marketing expenses. In 1997,
     EnerTel also generated revenue from long distance telecommunications
     services provided to business customers through direct network connections
     as well as from leased lines and Internet access services. During the first
     half of 1998, EnerTel expanded its leased lines and Internet access
     services while also introducing international leased lines and 800
     services. Principal sources of expenses are access and termination charges
     of KPN Telecom, leased line charges, network maintenance and general and
     administrative expenses. Additionally, EnerTel has incurred substantial
     marketing costs in an effort to develop its brand name recognition. 
      
     In July 1998, the Company acquired IIC for consideration of $750,000 in
     cash and  772,727 shares of common stock (of which 38,500 were placed in
     escrow) plus net working capital at June 30, 1998 (to be settled in
     shares). IIC specializes in providing international long distance services
     primarily to Latin America. Additionally, IIC is beginning to provide
     international private line services. IIC's customer base consists primarily
     of resellers, multinational corporations, foreign embassies, and other
     businesses. IIC's gross margin is equal to the incremental difference
     between the per minute rate charged to it by various long distance carriers
     and the amount it charges its customers per minute, depending upon a call's
     origination and destination points. IIC's other principal expense is the
     commissions it pays its various distributors based on sales volumes. 

     Pending Acquisitions
      
     In May 1998, the Company entered into a definitive agreement (subsequently
     modified in July 1998) for the acquisition of all of the issued and
     outstanding capital stock of AACR, for consideration of $31.5 million in
     cash, 300,000 shares of common stock and the repayment of AACR indebtedness
     of approximately $12 million. The shares will be delivered into escrow to
     secure the indemnification obligations of the former AACR shareholders
     under the acquisition documents for a period of one year following the
     closing. AACR provides international long distance, data, leased line,
     microwave, satellite, telex and wireless services in the Dominican
     Republic. Additionally, AACR holds a license to provide PCS services. 
     AACR's principal source of revenue is long distance sales augmented by
     sales of cellular and data services. AACR's principal sources of expenses
     are long distances charges from other carriers, interconnection fees, and
     various administrative expenses. This acquisition is expected to close in
     the third quarter of 1998. 
      
     In July 1998, the Company entered into a definitive agreement for the
     acquisition of all the capital stock of Campuslink for consideration of $15
     million in cash, 2,000,000 shares of common stock and warrants exercisable
     for 1,000,000 shares of common stock at $4 per share.  Campuslink provides
     design, installation, and management of integrated telecommunications
     systems to colleges, universities and private student housing complexes.
     Campuslink typically funds certain infrastructure costs in exchange for an
     exclusive service agreement to provide telecommunications services to its
     customers. The Company's customers include Texas Christian University, the
     University of Kansas and The U.S. Military Academy at West Point.
     Campuslink plans to expand its customer base geographically and has
     recently reorganized the business into regional marketing areas. Campuslink
     generates revenues through resale of telephone, video, and data services to
     residents of the schools; on-going flat per-student technology fees
     assessed to the college, university, or property owner; and one-time fees
     associated with special network integration or system installation
     projects. Campuslink's principal expenses relate to rental of T-1 lines,
     cost of network equipment on installation projects, carrier termination
     charges and personnel costs. This acquisition is expected to close in the
     third quarter of 1998. 


     RECENT DEVELOPMENTS
      
     In addition to acquiring EnerTel, ICX and IIC, and entering into agreements
     to acquire AACR and Campuslink since March 31, 1998, material developments
     in the Company's business include the following: 
      
     Interim Loan:  To finance the EnerTel acquisition, the Company entered into
        a $120 million bridge loan facility with a consortium of banks effective
        June 23, 1998 which also contained 1,644,969, $0.01 warrants to purchase
        shares of common stock.  The Interim Loan, which matures on June 23,
        1999, includes certain negative and affirmative covenants and is secured
        by a lien on substantially all of the assets of the Company and certain
        of its subsidiaries and a pledge of the capital stock of certain of the
        Company's subsidiaries.

     Private Placement Offering:  The Company is currently making a private
        offering (the "Offering") of Units consisting of Senior Notes and
        attached Warrants.  It is anticipated that these proceeds would be used
        to repay the Interim Loan.  The remaining proceeds will be utilized to
        pay the cash portion of the aforementioned acquisitions as well as meet
        a portion of the capital expenditure requirements associated with the
        Company's network build-out and working capital needs.

     Global Crossing Capacity Agreements:  In June 1998, the Company entered
        into letters of intent with Global Crossing to purchase IRUs for two
        STM-1s of capacity, in addition to previously acquired IRUs for five
        STM-1s of capacity, on Global Crossing's AC-1 cable system.


     EQUANT, Nortel and Lucent Agreements: In July 1998, the Company entered
        into a Master Global Telecom Facilities Management Agreement with EQUANT
        providing a framework for EQUANT's provision of co-location services for
        certain of the Company's switches and other network equipment as well as
        technical support and  maintenance for these switches and equipment and
        for the Company's proposed service control points in the United States
        and Europe. In addition, in June 1998, the Company entered into
        agreements with Nortel for the construction,  turn-key installation,
        in-country technical support and maintenance of a minimum of 10 DMS-GSP
        Switches to be installed in various locations worldwide. Also, in July
        1998 the Company entered into a memorandum of understanding with Lucent
        with respect to the development of the Company's IP backbone using IP
        Switches to be deployed at the Company's DMS-GSP Switch locations. 
      
     European and United States Land Based Fiber Capacity: In June 1998, the
        Company entered into an agreement with Viatel Inc. to acquire a 20-year
        IRU for 5 x 34 Mbs of capacity on its Circe network, which, when
        completed, will link cities in France, Germany, Belgium, The Netherlands
        and the United Kingdom, in exchange for equivalent capacity on Global
        Crossing's Atlantic Crossing cable. 

     Expanded Equipment Lease Facility: In June 1998, the Company entered into
        an agreement with Forsythe/McArthur to increase, subject to completion
        of the Offering, an existing equipment financing facility from $13
        million to $30  million.

     Results of Operations

     Prior to its acquisition of the assets and ongoing operations of TNC in
     June 1997and in July 1997, the Company was a development stage company that
     had not generated revenues other than interest income since inception.
     During the three and six months ended June 30, 1998, the Company incurred
     losses of $5,429,032 and $8,434,359, respectively, compared to $375,226 and
     $637,520 during the same periods in 1997.  Included in the losses incurred
     during the three and six months ended June 30, 1998 are the operating
     results of TNC, WWC and WorldPort Europe as well as general expenses
     related to the Company's worldwide business development and financing
     activities.  WWC  and WorldPort Europe's operating revenues and expenses
     did not have a material impact on the operating revenues and expenses of
     the Company in 1998.  

     Prior to the TNC acquisition, TNC had experienced a history of operating
     losses and cash flow deficiencies. Subsequent to the closing of the TNC
     acquisition, revenues from the operations declined, primarily as a result
     of the Company's shift in focus toward higher-margin product lines in new
     international markets. To address and remedy TNC's historical operating
     losses and to increase the competitiveness, revenues and gross margins of
     the assets and operations acquired in the TNC acquisition, since the
     acquisition, the Company has taken various steps to improve TNC's operating
     efficiency, network capability and carrier cost structure. The Company
     believes these cost-reduction and revenue-enhancing initiatives will have a
     positive impact on TNC's future operating results and the Company expects
     that its future consolidated results will be significantly different as a
     result of the acquisitions of ICX, EnerTel and IIC and the pending
     acquisition of AACR and Campuslink. However, as its business remains in the
     early growth stage, the Company anticipates that it will continue to incur
     operating losses and cash flow deficiencies for the foreseeable future. 

     Revenues

     Revenues for the three and six months ended June 30, 1998 were $1,715,505
     and $2,663,693, respectively, compared to  $188,549 for the three and six
     months ended June 30, 1997.  The increase in revenues was due to the
     inclusion of the results of operations of TNC and ICX subsequent to their
     closings in  June 1997 and April 1998, respectively.   The acquisition of
     WorldPort Europe did not have an impact on revenues as WorldPort Europe is
     in the process of completing the installation and testing of its network. 

     Gross Margin

     Gross margin for the three and six months ended June 30, 1998 was $98,830
     and $156,207, respectively, compared to $(5,863) for the three and six
     months ended June 30, 1997.   The increase in gross margin was due to the
     inclusion of the results of operations of the TNC and  ICX subsequent to
     their closings in  June 1997 and April 1998, respectively, offset by the
     costs of testing the network of WorldPort Europe.

     Selling, General and Administrative Expenses

     Selling, general and administrative expenses increased to $ 3,996,909 from
     $363,679 and to $6,252,079  from $652,648 for the three and six months
     ended June 30, 1998 and 1997, respectively.  The increase was due primarily
     to (i) increased business development and acquisition activity, (ii) the
     relocation of the Company's corporate offices from Houston, Texas to
     Kennesaw, Georgia, (iii) the expansion of the Company's executive
     management team, (iv) certain non-recurring compensation charges associated
     with the granting of restricted stock and certain options to certain
     members of the Company's management team and (v) the inclusion of the
     selling, general and administrative expenses associated with the operations
     of TNC, ICX and WorldPort Europe.

     Depreciation and Amortization

     Depreciation and amortization expense for the three and six months ended
     June 30, 1998 was $865,936 and $1,497,162, respectively, compared to
     $29,770 for the three and six months ended June 30, 1997.  The increase was
     due to (i) depreciation of the assets acquired in connection with the TNC
     Acquisition and the ICX acquisition, (ii) amortization of goodwill and
     other intangible assets associated with the TNC Acquisition, the WWC
     Acquisition,  the WorldPort Europe Acquisition, and the ICX Acquisition and
     (iii) depreciation of additional switching and peripheral equipment
     acquired during 1997 and 1998.

     Interest Expense

     Net interest expense for the three and six months ended June 30, 1998 was
     $665,017 and $841,325, respectively, compared to net interest income of
     $24,086 and $50,761 for the three and six months ended June 30, 1997,
     respectively. The increase in interest expense is primarily due to  the
     acquisition of switching equipment subject to capital lease and
     amortization of debt issuance costs related to the Interim Loan.  
     Liquidity and Capital Resources

     The Company is an emerging international telecommunications service
     provider executing a global business plan that requires substantial
     capital. The Company currently has a working capital deficit and has
     operated at a loss since its inception. Funding of the working capital
     deficit, current and future operating losses and expansion of the Company
     will require substantial continuing capital investment. 
      
     As of June 30, 1998 and December 31, 1997 the Company had a working capital
     deficit of $110,236,379 and $4,142,742, respectively.  The working capital
     deficit at June 30, 1998 is due to (i) the payment of certain liabilities
     assumed in conjunction with the TNC, WorldPort Europe and EnerTel
     acquisitions, the majority of which were trade payables and short-term debt
     obligations, (ii) the acquisition of additional switching and peripheral
     equipment, the majority of which is being financed pursuant to a lease, 
     (iii) the operating losses of the Company, and (iv) the Interim Loan. Trade
     receivables increased to $4,443,938 at June 30, 1998 from $368,848 at
     December 31, 1997. 
      
     Operations used $6,289,988 during the six months ended June 30, 1998
     compared to $659,819 during the six months ended June 30, 1997 due
     primarily to the (i) operating losses, (ii) increased business development
     and acquisition activity, (iii) relocation of the Company's corporate
     offices and (iv) expansion of the Company's executive management team. 
      
     Investing activities used  $115,313,476 during the six months ended June
     30, 1998 compared to $238,287 during the six months ended June 30, 1997.
     Investing activities during the six months ended June 30, 1998 consisted
     primarily of cash paid in connection with the EnerTel acquisition and
     increased capital spending. Investing activities during the six months
     ended June 30, 1997 consisted of the collection of a note receivable. 
      
     Financing activities provided $132,546,193 during the six months ended June
     30, 1998 compared to using $250,028 during the six months ended June 30,
     1997. Financing activities during the six months ended June 30, 1998
     consisted primarily of proceeds from (i) interim financing for purposes of
     completing the acquisition of EnerTel, (ii)  the issuance of approximately
     2.5 million shares of the Series B convertible preferred stock and 180,000
     shares of common stock and (iii) payments on capital leases and notes
     payable.  For the six months ended June 30, 1997, financing activities
     included repayments of short-term debt.   
      
     In October 1997, the Company purchased approximately $3.6 million of
     network and switching equipment to be installed in various cities in the
     United States and Europe as part of its global network strategy. The
     equipment was purchased pursuant to a lease financing facility with
     Forsythe/McArthur. The lease associated with this equipment calls for
     monthly payments in the amount of $121,701 for a period of 36 months
     commencing on March 1, 1998. 
      
     In 1997, the Company conducted a private placement offering of its Series A
     preferred stock. The Company received total gross proceeds of $1,111,250 in
     exchange for 493,889 shares of the Company's Series A preferred stock. The
     Company paid $113,485 in offering costs in connection with the Series A
     preferred stock offering. 
      
     During 1998, the Company initiated a private placement offering of its
     Series B convertible preferred stock at $5.36 per share. The Series B
     convertible preferred stock is convertible into shares of the Company's
     common stock at any time at the option of the holder at a rate of four
     shares of common stock for each share of preferred stock. Holders of Series
     B convertible preferred stock have voting rights equal to 40 votes per
     share on all matters submitted to a vote of the stockholders of the
     Company. As of June 30, 1998, the Company has received approximately $12.5
     million in proceeds from the sale of the Series B convertible preferred
     tock and converted approximately $1.2 million of  outstanding debt into the
     Series B convertible preferred stock. 
      

     On June 23, 1998, WorldPort International, Inc., a wholly-owned subsidiary
     of the Company ("WorldPort International") entered into a Credit Agreement
     for the Interim Loan with Bankers Trust Company, an affiliate of BT Alex.
     Brown and several lenders, pursuant to which WorldPort International
     borrowed $120 million in order to finance the acquisition of EnerTel and
     for working capital. The Interim Loan was guaranteed by the Company and
     certain of its subsidiaries. The Interim Loan bears interest at  LIBOR (as
     defined in the credit agreement related to the Interim Loan) plus 6% per
     annum increasing by 0.5% per annum at the end of each period of three
     consecutive months after June 23, 1998; provided, that such interest rate
     shall not exceed 16% per annum if paid in cash or 18% per annum if
     capitalized. The Interim Loan also contained 1,644,969, $0.01 warrants to
     purchase shares of common stock.  The fair market value of these warrants
     ($14 million) is reflected as a reduction in the principal amount of the
     notes.  This amount is being amortized to interest expense over the life of
     the loan (1 year).  At such time as the facility is repaid, the remaining
     unamortized portion of the value of the warrants will be expensed.  The
     Company intends to cause WorldPort International to repay the Interim Loan
     from the proceeds of a private debt offering anticipated to be completed in
     the third quarter of 1998. Otherwise, the Interim Loan matures on June 23,
     1999. The Interim Loan  includes certain negative and affirmative covenants
     and is secured by a lien on substantially all the assets of the Company and
     certain of its subsidiaries and a pledge of the capital stock of certain of
     the Company's subsidiaries. 
      
     The Company expects that funds it anticipates raising in the Offering and
     other private equity transactions it is currently negotiating  will provide
     the Company with sufficient capital to fund planned capital expenditures
     and anticipated losses for at least the next twelve months after which the
     Company anticipates that it will need to raise additional capital through
     equity or debt financing transactions to continue its planned network
     development and to fund operations. There can be no assurance that the
     Company can complete such financing transactions, including those pending,
     on favorable terms, if at all. 


Year 2000 Issue   

     The Year 2000 issue exists because many computer systems and applications
     currently use two-digit fields to designate a year.  As the century date
     change occurs, date-sensitive systems will recognize the year 2000 as 1900
     or not at all. The inability to recognize or properly treat the Year 2000
     may cause systems to process critical financial and operational information
     incorrectly.  The Company's management has assessed the impact of the Year
     2000 issue on the Company's computer hardware and software systems.  Based
     on this assessment, management currently believes that the costs of
     resolving the Year 2000 issues will not be material to the Company's
     results of operations or financial condition.

New Accounting Pronouncements

     SFAS No. 130, Reporting Comprehensive Income, issued by the Financial
     Accounting Standards Board, establishes standards for reporting and display
     of comprehensive income and its components (revenues, expenses, gains, and
     losses) in a full set of general-purpose financial statements.  SFAS No.
     130 requires that all items that are required to be recognized under
     accounting standards as components of comprehensive income be reported in a
     financial statement that is displayed with the same prominence as other
     financial statements.  The Company adopted SFAS No. 130, effective January
     1, 1998, with no material impact on the consolidated financial statements.

     SFAS No. 131, Disclosures about Segments of an Enterprise and Related
     Information, establishes standards for the way that public business
     enterprises report information about operating segments in annual financial
     statements and requires that those enterprises report selected information
     about operating segments in interim financial reports issued to
     shareholders.  SFAS No. 131 also establishes standards for related
     disclosures about products and services, geographical areas, and major
     customers.  The adoption of SFAS No. 131 is not expected to have a material
     impact on the consolidated financial statements.

     In June 1998, the FASB issued Statement of Financial Accounting Standards
     No. 133, Accounting for Derivative Instruments and Hedging Activities,
     which is effective for fiscal years beginning after June 15, 1999. SFAS No.
     133 establishes accounting and reporting standards for derivative
     instruments and transactions involving hedge accounting.  The Company has
     not yet determined the impact this statement will have on its consolidated
     financial statements.






                           PART II. OTHER INFORMATION


ITEM 1.  LEGAL PROCEEDINGS 

     From time  to time, the Company  is involved in various  lawsuits or claims
     arising from the  normal course of business. In  the opinion of management,
     none of these lawsuits or claims will have a material adverse effect on the
     financial statements or results of operations of the Company.

     On April 17, 1998, the Company was served with a summons and complaint from
     MC  Liquidating Corporation f/k/a  MIDCOM Communications,  Inc. ("MIDCOM").
     Both the  Company and  Telenational Communications, Inc.,  its wholly-owned
     subsidiary are  named as  defendants, as are  TNC, and Edmund  Blankenau, a
     principal  of TNC and a former director of  the Company.  In its complaint,
     filed  on April  8,  1998 in  the  U.S. Bankruptcy  Court  for the  Eastern
     District of  Michigan,  Southern Division,  MIDCOM  seeks payment  of  over
     $600,000 for services allegedly  provided to TNC and the  Company, together
     with other  damages, attorney  fees and  costs.  The  Company believes  the
     claims  are without merit and  intends to vigorously  defend itself against
     them. 

     On April  13, 1998, John Dalton, a former director and the former President
     and  Chief Executive Officer of the Company ("Dalton") filed a complaint in
     the  District Court  of Harris  County Texas  against the  Company, Marroon
     Bells  Capital  Partners  ("MBCP"), Paul  A.  Moore,  the  Chairman of  the
     Company's Board  of Directors  and the  Company's Chief Executive  Officer,
     Phillip  S. Magiera,  a  director  and  the  Chief  Financial  Officer  and
     Secretary of the Company, Dan Wickersham, the President and Chief Operating
     Officer  of the  Company and  Theodore H.  Swindells,  a principal  of MBCP
     (collectively,  the "Defendants").   Dalton's  employment as  President and
     Chief  Executive Officer of the  Company was terminated  effective April 6,
     1998.    The complaint  alleges, among  other  things, breach  of contract,
     tortious interference and breach of fiduciary duties in connection with the
     Company  and the  termination of  Dalton's employment.   Dalton  is seeking
     unspecified  damages from the Defendants as well as attorney fees, expenses
     and interest.   The company believes that the allegations  in the complaint
     are  without merit  and the  Defendants, including  the Company,  intend to
     vigorously defend the action.  Further, the Company has  notified Dalton of
     its  intention  to  seek   rescission  of  the  WWC  Acquisition   and  the
     cancellation of all shares of the Company's capital stock previously issued
     to  Dalton,  since the  Company believes  that  the WWC  Acquisition.   The
     Company has  initiated arbitration  proceedings against Dalton  pursuant to
     the Merger Agreement  executed by  Dalton, WWC, the  Company and  WorldPort
     Acquisition,  Inc.  and the  Employment  Agreement between  Dalton  and the
     Company. 


ITEM 2.  CHANGES IN SECURITIES 

     The following  securities have  been  issued or  sold without  registration
     under the Securities Act of 1933, as amended, (the "Securities Act") during
     the three months ended  March 31, 1998.  The sales described  below were to
     "accredited investors" as  defined in  Regulation D  promulgated under  the
     Securities Act and were exempt under Section 4(2) of the Securities Act:

     During  the second quarter of  1998, the Company  raised approximately $2.3
     million in  a private placement offering of its par value $0.0001 Series  B
     Convertible  Preferred Stock (the  "Series B Preferred  Stock Offering") at
     $5.36 per share.   The Series B Convertible Preferred Stock  is convertible
     into shares of the Company's common stock at any time at  the option of the
     holder  at a rate of 4  shares of common stock for  each share of preferred
     stock.   Holders of Series B Convertible Preferred Stock have voting rights
     equal  to 40 votes  per share  on all  matters submitted to  a vote  of the
     stockholders of the Company.

     In May 1998, the Company sold 180,000 shares of its common stock at a price
     of $5.00  per  share  to an  accredited  investor in  a  private  placement
     transaction.

     In connection with the  WorldPort Europe Acquisition in February  1998, the
     Company issued 150,000 shares of the Company's common stock  to the seller.
     Additionally,  in  connection  with  the  acquisition  of  the  assets  and
     operations of ICX in April  1998, the company issued 400,000 shares  of its
     common stock to  ICX (of which 200,000  will be held pursuant  to an escrow
     agreement of a  period of eighteen months following the  closing subject to
     the  attainment of certain future revenue requirements and to indemnify the
     Company for certain representations and warranties).


ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

     The Company has not made any of its scheduled payments on its $500,000 debt
     obligation  to Value  Partners, Ltd.  ("Value Partners").   The  Company is
     currently  renegotiating this  debt obligation,  and has  reached tentative
     agreement with Value Partners on revised terms. 

      
ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.


ITEM 5.  OTHER INFORMATION

None.


ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

Exhibits     

                Exhibit No.                Description

                 10.1         Second Amendment To Employment
                              Agreement between Phillip S. Magiera
                              and the Company dated April 1, 1998
                10.1(a)
                              Promissory Note between Phillip S.
                              Magiera and the Company dated April
                10.1(b)       1, 1998

                              Pledge Agreement made by Phillip S.
                              Magiera and the Company dated April
                              1, 1998
                 10.2         Second Amendment To Employment
                              Agreement between Paul A. Moore and
                              the Company dated April 1, 1998
                10.2 (a)
                              Promissory Note between Paul A. Moore
                              and the Company dated April 1, 1998
                10.2(b)         
                              Pledge Agreement made by Paul A.
                              Moore and the Company dated April 1,
                              1998

                 10.6         Credit Agreement the Company and The
                              Financial Institutions Party Hereto
                              as Lenders and Bankers Trust Company
                              as Administrative Agent and
                              Collateral Agent dated June 23, 1998

                27.1           Financial Data Schedule

                 

Reports on Form 8-K          

Form 8-K dated June 25, 1998, filed with the Securities  and Exchange Commission
on July 9, 1998, as amended by Form 8-K/A filed with the Securities and Exchange
Commission on August 13, 1998.

Form 8-K filed dated August 3, 1998, with the Securities and Exchange Commission
on August 13, 1998.



                                SIGNATURE


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.


                              WORLDPORT COMMUNICATIONS, INC.




Date:  August 14, 1998           By:  /s/ Phillip S. Magiera         
                                           
                                 Phillip S. Magiera
                                 Chief Financial Officer and Secretary