SECURITIES EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                   FORM 10-QSB

                Quarterly Report Pursuant to Section 13 or 15(d)
                     of the Securities Exchange Act of 1934


                For the quarterly period ended February 28, 1999
                         Commission file number 0-21210


                                   NELX, INC.

             (Exact name of registrant as specified in its charter)




         Kansas                                                 84-0922335
---------------------------------                            -------------------
(State or other jurisdiction                                 (I.R.S. Employer
of incorporation or organization)                            Identification No.)


                      Rt. #1, Box 4-J, Bridgeport, WV 26330
            -------------------------------------------------------

               (Address of principal executive offices) (Zip Code)
              ----------------------------------------------------
       Registrant's telephone number, including area code: (304) 622-9599


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 the  filing
requirements for at least the past 90 days.

                                  Yes  X       No
                                     -----        ------

As of February  28, 1999,  there were  46,352,042  outstanding  shares of common
stock, par value $.0001.



<PAGE>



PART 1.           FINANCIAL INFORMATION

         ITEM 1.           Financial Statements

<TABLE>
<CAPTION>

                                   NELX, INC.
                           Consolidated Balance Sheet
                                   (Unaudited)

<S>                                                                           <C>                        <C>
                                                                              February                   February
                                                                              28, 1999                   28, 1998

ASSETS

Current Assets
     Cash & Cash Equivalents                                                        $ 774                    $ 7,002

Property, Plant and Equipment
     Plant and Plant Equipment                                                    100,000                    100,000
     Equipment                                                                      8,654                     12,479
     Land                                                                                                    450,000
     Buildings                                                                     54,175                     82,000
                                                                                  162,829                    644,479
     Less Accumulated Depreciation                                                114,266                    106,154
          Net Fixed Assets                                                         48,563                    538,325

TOTAL ASSETS                                                                     $ 49,337                  $ 545,326
                                                                           ===============            ===============


LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities
     Accounts Payable                                                            $ 24,255                  $ 173,468
     Accrued Expenses                                                              10,037                    203,712
     Note Payable - Stockholder                                                    61,650                    139,950
     Current Portion of Long-Term Debt                                              3,000                      3,000
          Total Current Liabilities                                                98,941                    520,130

Long Term Liabilities
     Notes Payable                                                                                           334,769

Total Liabilities                                                                  98,941                    854,899


Stockholders' Equity
     Common Stock. $0.0001 par value, 500,000,000 shares authorized
     46,352,042 issued and outstanding at May 31, 1998 and November 30,
     1998, respectively                                                             4,635                      4,635
     Additional paid-in capital                                                 7,623,975                  7,465,975
     Retained Deficit                                                          (7,678,214)                (7,780,182)
TOTAL STOCKHOLDERS' DEFICIT                                                       (49,605)                  (309,573)

TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT                                      $ 49,337                  $ 545,326
                                                                           ===============            ===============

</TABLE>


<PAGE>

<TABLE>
<CAPTION>

                                   NELX, INC.
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                     For the Nine Months Ended February 28,
                                   (Unaudited)

<S>                                                                             <C>                         <C>
                                                                                1999                        1998
                                                                                ----                        ----
REVENUES
     Gain/Loss on Sale of Assets                                                      875                     176,474
     Consulting Fees                                                                                           11,000
     Misc Income                                                                                              211,463
     Cost of Sales                                                                                             (2,049)
                                                                                                               -------
                                                                           ---------------             ---------------

Gross Profit                                                                          875                     396,888

EXPENSES
     Interest                                                                       4,542                       1,450
     Office Expense                                                                 3,314                      12,741
     Professional Fees                                                              4,450                      35,837
     Telephone & Utilities                                                            597                       5,632
                                                                                     ----                      -----
Total Operating Expenses                                                           12,903                      55,660

NET INCOME (LOSS)                                                               $ (12,028)                  $ 341,228
                                                                           ===============             ===============

Profit (Loss) per common share                                                      (0.00)                       0.01

Weighted average number of shares outstanding                                  46,352,042                  46,352,042

</TABLE>

<PAGE>

<TABLE>
<CAPTION>

                                   NELX, INC.
                      Consolidated Statement of Cash Flows
                                   (Unaudited)

<S>                                                                            <C>                      <C>
                                                                                       Nine Months
                                                                                    Ended February 28,
                                                                               1999                     1998
                                                                               ----                     ----
Cash Flows from Operating Activities:
     Net Profit (Loss)                                                         $(12,028)                $341,228
     Depreciation
     (Decrease) Increase in Accounts Payable                                    (54,510)                (315,956)
     (Decrease) Increase in Accrued Expenses                                                            (170,437)
     (Increase) Decrease in Other Assets                                                                   3,950
     (Increase) Decrease in Accounts Receivable
                                                                           -------------            -------------

Net Cash Flows Used for Operating Activities                                    (66,538)                (141,215)

Cash Flows from Investing Activities
     (Purchase) Sale of Fixed Assets                                             27,825                  500,000
     (Purchase) Sale of Note Receivable
     (Purchase) Sale of Investment
                                                                           -------------            -------------

Net Cash (Used by) From Investing Activities                                     27,825                  500,000

Cash Flows from Financing Activities
     Increase (Decrease) in Note Payable                                       (120,175)                (365,150)
     Sale of Common Stock                                                       158,000                   21,900
     Sale of Treasury Stock
                                                                           -------------            -------------

Total Cash from (Used by) Financing Activities                                   37,825                 (343,250)

Increase (Decrease) in Cash                                                        (888)                  15,535
                                                                                                          ------

Cash and Cash Equivalents - Beginning of Period                                   1,662                   (8,533)
                                                                                                          -------

Cash and Cash Equivalents - end of Period                                           774                    7,002
                                                                           =============            =============
</TABLE>


<PAGE>

<TABLE>
<CAPTION>

                                   NELX, INC.
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                     For the Three Months Ended February 28,
                                   (Unaudited)
<S>                                                                               <C>                        <C>
                                                                                  1999                       1998
                                                                                  ----                       ----
REVENUES
     Gain/(Loss) on Sale of Assets                                                      875                    176,474
     Consulting Fees                                                                                            11,000
     Misc Income                                                                                               114,720
     Cost of Sales
                                                                             ---------------

Gross Profit                                                                            875                    302,194

EXPENSES
     Interest                                                                             -                      1,224
     Office Expense                                                                     911                      7,515
     Professional Fees                                                                    -                     (2,300)
     Telephone & Utilities                                                              106                      1,036
                                                                                        ----                     -----
Total Operating Expenses                                                              1,017                      7,475

NET INCOME (LOSS)                                                                    $ (142)                 $ 294,719
                                                                             ===============            ===============

Loss per Common Share                                                                 (0.00)                      0.01

Weighted average number of shares outstanding                                    46,352,042                 46,352,042

</TABLE>

<PAGE>

<TABLE>
<CAPTION>

                                   NELX, INC.
                      Consolidated Statement of Cash Flows
                                   (Unaudited)

<S>                                                                            <C>                      <C>
                                                                                       Three Months
                                                                                    Ended February 28,
                                                                               1999                     1998
                                                                               ----                     ----
Cash Flows from Operating Activities:
     Net Profit (Loss)                                                           $ (142)                $294,720
     Depreciation
     (Decrease) Increase in Accounts Payable                                     (9,000)                (189,254)
     (Decrease) Increase in Accrued Expenses                                                            (180,474)
     (Increase) Decrease in Other Assets
     (Increase) Decrease in Accounts Receivable
                                                                           -------------            -------------

Net Cash Flows Used for Operating Activities                                     (9,142)                 (75,008)

Cash Flows from Investing Activities
     (Purchase) Sale of Fixed Assets                                             31,000                  501,000
     (Purchase) Sale of Note Receivable
     (Purchase) Sale of Investment
                                                                           -------------            -------------

Net Cash (Used by) From Investing Activities                                     31,000                  501,000

Cash Flows from Financing Activities
     Increase (Decrease) in Note Payable                                        (25,175)                (440,050)
     Sale of Common Stock                                                                                 (5,000)
     Sale of Treasury Stock
                                                                           -------------            -------------

Total Cash from (Used by) Financing Activities                                  (25,175)                (445,050)

Increase (Decrease) in Cash                                                      (3,317)                 (19,058)
                                                                                                         --------

Cash and Cash Equivalents - Beginning of Period                                    4,091                  26,060
                                                                                                          ------

Cash and Cash Equivalents - end of Period                                           774                    7,002
                                                                           =============            =============

</TABLE>

<PAGE>

<TABLE>
<CAPTION>


                                   NELX, INC.
                 CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
           February 28, 1999

<S>                                         <C>                 <C>             <C>               <C>
                                                    Common Stock                Additional
                                                                                Paid - In         Accumulated
                                            # of Shares         Amount           Capital            Deficit
                                         ------------------------------------------------------------------------

Balance at May 31, 1995                         10,437,581          $ 1,044        $ 5,195,578      $ (1,119,758)

Issuance of Common Stock
  for Cash                                       1,520,100              152            382,086

Issuance of Common Stock
  for Services Rendered                          4,058,619              406            917,520

Issuance of Common Stock
  for Assets acquired or Reduction
  in Liabilities                                 2,931,000              293            688,596

May 31, 1996 - Net Loss                                                                               (2,903,569)
                                         ------------------------------------------------------------------------

Balance at May 31, 1996                         18,947,300            1,895          7,183,780        (4,023,327)

Issuance of Common Stock
  for Cash                                         185,280               19              9,245

Issuance of Common Stock
  for Services Rendered                          6,344,462              634            248,137

May 31, 1997 - Net Loss                                                                               (4,093,083)
                                         ------------------------------------------------------------------------

Balance at May 31, 1997                         25,477,042            2,548          7,441,162        (8,116,410)

Issuance of Common Stock
  for Cash                                      20,875,000            2,087             24,813

May 31, 1998 - Net Loss                                                                                 (184,932)
                                         ------------------------------------------------------------------------

Balance at May 31, 1998                         46,352,042            4,635          7,465,975        (8,301,342)

Sale of Treasury Stock
  for Cash                                                                             158,000

Prior Year Adjustment                                                                                    635,156

February 28, 1999 Net Loss                                                                               (12,028)
                                         ------------------------------------------------------------------------

Balance at February 28, 1999                    46,352,042            4,635          7,623,975        (7,678,214)
                                         ========================================================================
</TABLE>


<PAGE>


                                   NELX, INC.
                          NOTES TO FINANCIAL STATEMENTS


NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

         The  following  is a  summary  of NELX,  Inc.'s  (Company)  significant
         accounting policies:

         BASIS OF PRESENTATION

         The financial  information included herein is unaudited;  however, such
         information  reflects  all  adjustments  (consisting  solely  of normal
         recurring  adjustments)  which  are,  in  the  opinion  of  management,
         necessary for a fair statement of results for the interim periods.

         The results of operations for the three- and  nine-month  periods ended
         February 28, 1999 are not  necessarily  indicative of the results to be
         expected for the full year.

         Organization

         The  Company was  incorporated  March 25, 1983 under the laws of Kansas
         for the purpose of acquiring, dealing in and, if warranted,  developing
         oil and gas properties. The Company may also engage in other businesses
         or activities  unrelated to natural resources which management believes
         hold potential for profit. On October 25, 1983, the Company amended its
         Articles of  Incorporation  increasing its authorized  shares of 0.0001
         par value common stock from 200,000,000 to 500,000,000 shares.

         On  October  30,  1993,  a special  meeting of  Shareholders  was held.
         Stockholders  approved  a  name  change  of  the  Company  from  Nelson
         Exploration, Inc., to NELX, Inc.

         On November 30, 1993 the Board approved a "reverse split" of the issued
         and  outstanding  shares of common stock based upon issuance of one (1)
         new common  share in exchange  for each 30 shares of (old) common stock
         issued and outstanding effective as of December 31, 1993.

         Cash and Cash Equivalents:

         For purposes of the statement of cash flows,  cash and cash equivalents
         include cash in banks and money market accounts.



<PAGE>



                                   NELX, INC.
                          NOTES TO FINANCIAL STATEMENTS


NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CON'T:

         Income taxes:

         None.

         Reclassifications:

         None.

         Use of Estimates in the Preparation of Financial Statements:

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

NOTE 2 - LONG-TERM DEBT:

Following is a summary of long-term debt at February 28, 1999
                                                                 1999
============================================================================
Various         Unsecured notes payable to
%               others on various dates through
                February 28, 1999 at interest
                rates from 8% - 10%                             $64,650


NOTE 3 - GOING CONCERN:

         The Company  incurred a net loss of $184,932  for fiscal year ended May
         31, 1998 and has retained earnings (losses) of ($7,678,214) at February
         28, 1999.  At February 28, 1999,  current  liabilities  exceed  current
         assets  by  $49,605.  These  factors  indicate  that  the  Company  has
         substantial  doubt  about its ability to  continue  in  existence.  The
         financial  statements  do not include any  adjustments  relating to the
         recoverability  and  classification  of recorded assets, or the amounts
         and  classification of liabilities that might be necessary in the event
         the company cannot continue in existence.



<PAGE>



                                   NELX, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 4 - ASSET REVALUATION:

         In September  of 1995 the company  exchanged  350,000  shares of common
         stock for a mini mall located in Kansas  subject to a note for $31,875.
         The  company is in default on this note and the company has deeded this
         property in lieu of foreclosure to the mortgagee for relief of debt.

NOTE 5 - CHANGE OF CONTROL - ISSUANCE OF STOCK

         On October  9,  1997,  the Board of  Directors  accepted  an offer from
         Charles  Stout to acquire 20  million  shares of common  stock of NELX,
         Inc.,  in  consideration  for his  agreement to  contribute  $20,000 in
         immediate cash and to contribute such additional funding up to $250,000
         to settle accounts  payable and commitments.  Subsequently,  on October
         17, 1997,  the initial cash  contribution  of $20,000 was made.  The 20
         million shares  represents 46% of the  outstanding  stock of NELX, Inc.
         Mr. Charles Stout was appointed President on October 9, 1997.

NOTE 6 - PRIOR YEAR ADJUSTMENT

         During fiscal year ending May 31, 1997, NELX, Inc. wrote off $3,266,994
         of non-producing  assets. In 1998, NELX, Inc.'s new management returned
         assets and  restructured  debt  obligations.  NELX,  Inc. also received
         discounts from creditors on debts,  which allowed the Company to remain
         in business.  Management's prior year write-off of non-producing assets
         of $3,266,994,  due to debt  restructuring  and creditor  discounts was
         overstated by $635,156.



<PAGE>



ITEM 2.

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


Results of Operations  for nine month period ended February 28, 1999 compared to
same period in 1998.

         The Company has experienced  continuing operating expenses for the nine
month  period of $12,903  compared  to $55,660 in the same  period in 1998.  The
revenues for the period totaled $0 from oil and gas operations  compared with $0
for same period in 1998.  Miscellaneous  revenues totalled $875 in the period in
1999 and in the period in 1998  miscellaneous  income was $396,888.  The Company
recorded net loss of ($12,028) for the period as compared to $341,228 net income
for the same period in fiscal year 1998. The Company  losses on operations  will
continue until income from any operations can be achieved.  While the Company is
seeking capital  sources for investment,  there is no assurance that sources can
be  found.  The  Company  has  no  revenues  and  has  no  other  income  except
miscellaneous.

Results of  Operations  for the three  month  period  ended  February  28,  1999
compared to same period in 1998.

         The Company has experienced continuing operating expenses for the three
month  period of $1,017  compared  to  $7,475  in the same  period in 1998.  The
revenues  from  operations  for the period  totaled $0 compared with $0 for same
period in 1998. In the three month period in 1999, the Company had miscellaneous
income of $875 compared to $302,194 in miscellaneous income in 1998. The Company
recorded a net loss of ($142) for the period as compared to $294,719  net income
for the same period in fiscal year 1998. The Company  losses on operations  will
continue until income from any operations can be achieved.  While the Company is
seeking capital  sources for investment,  there is no assurance that sources can
be  found.  The  Company  has  no  revenues  and  has  no  other  income  except
miscellaneous.

Liquidity and Capital Resources

         The  Company  had minimal  cash  capital at the end of the period.  The
Company will be forced to either  borrow or make private  placements of stock in
order to fund any operations.  No assurance  exists as to the ability to achieve
sales of assets or loans  against  the assets,  or make  private  placements  of
stock.

Analysis of Financial Condition

     At February 28, 1999,  there were current  liabilities  payable of $98,941.
The Company had no source of income.  Long term debt was $0. The Company had, at


<PAGE>



period end, $774 in current assets, and the deficit in current assets to current
debts and liabilities was ($98,167).

PART II

                               OTHER INFORMATION

         Item 1.  Legal proceedings - None.
         Item 2.  Changes in securities - None.
         Item 3.  Defaults upon senior securities - None.
         Item 4.  Submission of matters to a vote of security holders - None.
         Item 5.  Other information - None.
         Item 6.  Exhibits and reports on Form 8-K
                           (a)      The  following are filed as Exhibits to this
                                    Quarterly  Report.  The numbers refer to the
                                    Exhibit Table of Item 601 of Regulation S-K:
                                      None.
                           (b)      Reports  on Form 8-K filed  during the three
                                    months    ended     February    28,    1999:
                                    (incorporated by reference)
                                      None.



<PAGE>


                                   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.


                                              NELX, Inc.
                                              (Registrant)



Date:  May 6, 1999                             /s/ Charles L. Stout
                                               ---------------------------------
                                               Charles L. Stout, President