UNITED STATES
                       SECURITIES AND 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 December 31, 2005

                                       or

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

         For the transition period from ____________ to ________________

                       Commission file number: [000-28277]

                            HERITAGE WORLDWIDE, INC.
                        ---------------------------------
        (Exact name of small business issuer as specified in its charter)

                  Delaware                           13-4196258
    -----------------------------------         --------------------
       (State or other jurisdiction of           (I.R.S. Employer
        incorporation or organization)          Identification No.)


             337 Avenue de Bruxelles La Seyne-Sur-Mer (France)  83507
 ------------------------------------------------------------------------------
               (Address of principal executive offices)       (Zip Code)

                              (011) (33) 494-109810
                        ---------------------------------
                (Issuer's telephone number, including area code)


Check whether the issuer has (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act during the past 12 months (or
for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days.
Yes [X] No [ ]

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

The total number of shares of the issuers' common stock, $.001 par value,
outstanding at February 10, 2006 was 17,410,299.

Transitional Small Business Disclosure Format:  Yes |_| No |X|


<PAGE>


                SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS


         To the extent that the information presented in this Quarterly Report
on Form 10-QSB for the quarter ended December 31, 2005 discusses financial
projections, information or expectations about our products or markets, or
otherwise makes statements about future events, such statements are
forward-looking. We are making these forward-looking statements in reliance on
the safe harbor provisions of the Private Securities Litigation Reform Act of
1995. Although we believe that the expectations reflected in these
forward-looking statements are based on reasonable assumptions, there are a
number of risks and uncertainties that could cause actual results to differ
materially from such forward-looking statements. These risks and uncertainties
are described, among other places in this Quarterly Report, in "Management's
Plan of Operation."

         In addition, we disclaim any obligations to update any forward-looking
statements to reflect events or circumstances after the date of this Quarterly
Report. When considering such forward-looking statements, you should keep in
mind the risks referenced above and the other cautionary statements in this
Quarterly Report.





                                       2

<PAGE>

                    HERITAGE WORDWIDE, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEET
                                December 31, 2005
                                   (Unaudited)


                                     ASSETS
Current Assets:
  Cash                                                            $     201,431
  Accounts receivable, net of an allowance for doubtful
    accounts of $ 688,734 and an allowance for product
    returns of $196,523                                               4,904,410
  Inventories                                                         3,306,015
  Prepaid expenses and other current assets                             639,272
                                                                  --------------


     Total current assets                                             9,051,128

Property and equipment, net of accumulated depreciation
    of $3,141,264                                                     1,418,973
Goodwill                                                                980,162
Investment in SCI Lucas                                                 521,718
Other assets                                                            377,745
                                                                  --------------


     Total assets                                                 $  12,349,726
                                                                  ==============


                      LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities:
  Lines of credit                                                 $     737,523
  Accounts payable and accrued expenses                               4,579,175
  Current portion of long term debt                                      74,392
  Due to related parties                                                  8,183
  Reserve for product replacements                                      296,577
                                                                  --------------


     Total current liabilities                                        5,695,850

Convertible debentures and related accrued interest payable,
 net of discount of $1,730,421                                        2,469,674
Long term debt, net of current portion                                  428,403
                                                                  --------------


     Total liabilities                                                8,593,927
                                                                  --------------


Minority interest                                                       906,771
                                                                  --------------


Stockholders' Equity:
  Common stock; $.001 par value, 50,000,000 shares
    authorized, 18,160,299 issued and 17,410,299 outstanding             17,411
  Additional paid-in capital                                          5,686,193
  Accumulated other comprehensive income (foreign currency
    translation adjustment)                                           1,187,181
  Accumulated deficit                                                (4,041,757)
                                                                  --------------


     Total stockholders' equity                                       2,849,028
                                                                  --------------

     Total liabilities and stockholders' equity                   $  12,349,726
                                                                  ==============





            See Notes to Unaudited Consolidated Financial Statements.

                                       3

<PAGE>

                    HERITAGE WORDWIDE, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)

<TABLE>
<CAPTION>

                                             For the Three-Month Period Ended  For the Six-Month Period Ended
                                                        December 31,                   December 31,
                                             --------------------------------  ------------------------------
                                                  2005             2004           2005             2004
                                             ---------------  ---------------  ------------  ----------------

<S>                                          <C>              <C>              <C>           <C>
Revenues                                     $    3,324,361   $    3,074,019   $ 6,346,753   $     5,957,741

Cost of revenues                                  1,041,895        1,602,355     2,640,067         2,873,773
                                             ---------------  ---------------  ------------  ----------------

     Gross profit                                 2,282,466        1,471,664     3,706,686         3,083,968
                                             ---------------  ---------------  ------------  ----------------

Operating expenses:
  Selling, general and administrative             1,754,449        1,050,220     2,693,638         2,072,622
  Research and development                          269,715          255,810       521,612           528,210
                                             ---------------  ---------------  ------------  ----------------

     Total operating expenses                     2,024,164        1,306,030     3,215,250         2,600,832
                                             ---------------  ---------------  ------------  ----------------

Income before other expenses and
minority interest                                   258,302          165,634       491,436           483,136
                                             ---------------  ---------------  ------------  ----------------

Other expenses:
  Other income (expense)                             17,078          (20,439)            -            (8,147)
  Gain in equity investment                           4,167           24,236        20,495            30,621
  Interest expense                                 (159,676)        (157,678)     (322,622)         (315,060)
                                             ---------------  ---------------  ------------  ----------------

     Total other income (expenses)                 (138,431)        (153,881)     (302,127)         (292,586)
                                             ---------------  ---------------  ------------  ----------------


Net income before minority interest                 119,871           11,753       189,309           190,550

Minority interest                                   (18,941)            (791)      (30,561)           (9,934)
                                             ---------------  ---------------  ------------  ----------------

Net income                                          100,930           10,962       158,748           180,616

Other comprehensive income, net of taxes
  Foreign currency translation adjustment          (330,909)         273,444      (360,221)          463,202
                                             ---------------  ---------------  ------------  ----------------

     Comprehensive income                          (229,979)         284,406      (201,473)          643,818
                                             ===============  ===============  ============  ================

Basic net income per common share                    $ 0.01           $ 0.00        $ 0.01            $ 0.01
                                             ===============  ===============  ============  ================

Basic weighted average common
shares outstanding                               17,410,299       17,410,299    17,410,299        17,410,299
                                             ===============  ===============  ============  ================

Diluted net income per share                         $ 0.01           $ 0.00        $ 0.01            $ 0.01
                                             ===============  ===============  ============  ================

Diluted weighted average common share
outstanding                                      17,449,390       17,410,299    17,436,238        17,423,087
                                             ===============  ===============  ============  ================
</TABLE>


         See Notes to Unaudited Consolidated Financial Statements.

                                       4

<PAGE>

                    HERITAGE WORDWIDE, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)


                                                  For the Six-Month Period Ended
                                                          December 31,
                                                  -----------------------------
                                                      2005            2004
                                                  --------------  -------------

Cash flows from operating activities:
Net income                                        $     158,748   $    180,616
Adjustments to reconcile net income to net cash
provided by operating activities:
   Interest expense related to debenture discount       236,006        197,759
   Depreciation and amortization                        248,250        115,681
   Provision for doubtful accounts                     (293,597)      (283,778)
  Loss on disposition of property                                          989
   Gain on equity investment                            (20,495)       (30,621)
   Minority interest                                     30,561          9,934
Change in operating assets and liabilities:
   Accounts receivable                                  (58,814)       861,549
   Inventories                                          (50,824)      (253,309)
   Prepaid expenses and other current assets             46,328         19,804
  Accrued interest on convertible debentures             62,400         47,484
   Provision for product replacements                  (125,864)        38,106
   Accounts payable and accrued expenses                (56,533)      (556,154)
                                                  --------------  -------------

Net cash provided by operating activities               176,166        348,060
                                                  --------------  -------------

Cash flows from investing activity:
  Proceeds from disposition of property
   and equipment                                              -         51,006
   Purchases of property and equipment                 (129,996)      (234,848)
                                                  --------------  -------------

Net cash used in investing activity                    (129,996)      (183,842)
                                                  --------------  -------------

Cash flows from financing activities:
   (Decrease) increase in lines of credit              (274,464)        78,708
   Proceeds from long term debt                         131,798         35,782
   Repayment of long term debt                          (97,050)      (162,502)
   Proceeds from subscriptions receivable                     -          2,541
   Increase (decrease) in due to stockholders           (43,466)       218,330
                                                  --------------  -------------

Net cash (used in) provided by financing
   activities                                          (283,182)       172,859
                                                  --------------  -------------

Effect of exchange rate changes on cash                  (3,540)        40,837
                                                  --------------  -------------

(Decrease) increase in cash                            (240,552)       377,914

Cash, beginning of period                               441,983        168,748
                                                  --------------  -------------

Cash, end of period                               $     201,431   $    546,662
                                                  ==============  =============

Supplemental disclosures of cash flow information:
     Cash paid during the period for interest     $     102,019   $     28,982
                                                  ==============  =============

     Cash paid during the period for taxes        $           -   $          -
                                                  ==============  =============

Non-Cash Investing and Financing Activities:

Conversion of due to shareholder in investment
   in subsidiary and corresponding increase in
   minority interest                              $           -   $    610,886
                                                  ==============  =============


          See Notes to Unaudited Consolidated Financial Statements.

                                       5

<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2005
                                   (Unaudited)


NOTE 1 - NATURE OF BUSINESS AND ACQUISITION

Heritage Worldwide, Inc. (the "Company") is incorporated in the State of
Delaware in 2001. The Company and its subsidiaries develop, manufacture, and
market breast and other body implants and body support products worldwide. The
Company maintains its production facility and headquarters in the Toulon
metropolitan area in Southern France. It also has a distribution facility in
Spain.

NOTE 2 - BASIS OF PRESENTATION AND CONSOLIDATION

The accompanying unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-QSB. Accordingly,
they do not include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements. In the opinion
of management, all adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation have been included. Operating
results for the six-months ended December 31, 2005 are not necessarily
indicative of the results that may be expected for the fiscal year ending June
30, 2006. For further information, refer to the financial statements and
footnotes thereto included in the Company's Annual Report on Form 10-KSB for the
fiscal year ended June 30, 2005.

The accompanying unaudited consolidated financial statements present the results
of operations of the Company's French and Spanish subsidiaries and OSMXM, inc.
("OS") for the six-month period ended December 31, 2005 and 2004, respectively
and OSMXM, Inc. ("OS) from July 1, 2004 through December 31, 2004. All material
intercompany accounts and transactions between the Company and its subsidiaries
have been eliminated in consolidation.

The accompanying consolidated financial statements include the results of
operations of SCI Lucas, a real estate holding company, in which the Company
holds an interest of approximately 38%. SCI Lucas owns the production facility
and headquarters in which the Company operates in Southern France. The results
of operations of SCI Lucas are accounted for using the equity method of
accounting. All material intercompany accounts and transactions between the
Company and SCI Lucas have been eliminated.

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Use of estimates

In preparing financial statements in conformity with accounting principles
generally accepted in the United States of America, management is required to
make estimates and assumptions that affect the reported amounts of assets and
liabilities and the disclosure of contingent assets and liabilities at the date
of the financial statements and revenues and expenses during the reporting
period. Actual results could differ from those estimates. Significant estimates
during the periods include the allowance for doubtful accounts, reserve for
obsolete inventory, the useful life of property, plant and equipment, and the
accrual of product replacement reserve.

                                       6

<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2005
                                   (Unaudited)

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Accounts receivable

Accounts receivable are reported at net realizable value. The Company has
established an allowance for doubtful accounts based upon factors pertaining to
the credit risk of specific customers, historical trends, and other information.
Delinquent accounts are written-off when it is determined that the amounts are
uncollectible. At December 31, 2005, the provision for doubtful accounts was
approximately $690,000. Additionally, the Company has established an allowance
for product returns based upon factors pertaining to historical trends. At
December 31, 2005, the provision for product returns was approximately $200,000.

Revenue recognition

The Company recognizes product revenue, net of estimated sales discounts and
returns and allowances, in accordance with Staff Accounting Bulletin No. 104,
"Revenue Recognition in Financial Statements" and SFAS No. 48 "Revenue
Recognition When Right of Return Exists." These statements established that
revenue can be recognized when persuasive evidence of an arrangement exists, the
product has been shipped, all significant contractual obligations have been
satisfied, the fee is fixed or determinable and collection is reasonably
assured.

Stock options

The Company accounts for stock options issued to employees in accordance with
the provisions of Accounting Principles Board ("APB") Opinion No. 25,
"Accounting for Stock Issued to Employees," and related interpretations. As
such, compensation cost is measured on the date of grant as the excess of the
current market price of the underlying stock over the exercise price. Such
compensation amounts, if any, are amortized over the respective vesting periods
of the option grant. We adopted the disclosure provisions of SFAS No. 123,
"Accounting for Stock-Based Compensation" and SFAS 148, "Accounting for
Stock-Based Compensation -Transition and Disclosure", which permits entities to
provide pro forma net income (loss) and pro forma earnings (loss) per share
disclosures for employee stock option grants as if the fair-valued based method
defined in SFAS No. 123 had been applied. The Company accounts for stock options
and stock issued to non-employees for goods or services in accordance with the
fair value method of SFAS 123.

No stock-based employee compensation cost is reflected in net income, as all
options granted under the Company's plans had an exercise price equal to or
above market value of the underlying common stock on the date of grant. Had
compensation cost for the Company's stock-based compensation plans been
determined based on the fair value at the grant dates for grants under those
plans consistent with the method of SFAS No. 123, the Company's cash flows would
have remained unchanged, however net income and earnings per share would have
been reduced to the pro forma amounts indicated below:

<TABLE>
<CAPTION>

                                                                  2005                2004
                                                                ----------        -----------
<S>                                                             <C>               <C>
Net income as reported:                                         $ 158,748         $  180,016
Deduct: Total stock-base employee compensation expense
           determined under fair value based method for all
           awards, net of related tax effects                    (124,376)          (124,094)
                                                                ----------        -----------
Net income pro forma                                            $  34,372         $   55,922
                                                                ==========        ===========

</TABLE>

                                       7

<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2005
                                   (Unaudited)

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

The fair value of the options granted during the six-month period ended December
31, 2004 was determined using the Black-Scholes option-pricing model with the
following assumptions: risk-free interest of 3.7%; stock volatility of 44%; no
dividends; estimated life of 48 months; and no dividend expected during the
term.

Foreign currency translation

For foreign operations with the local currency as the functional currency,
assets and liabilities are translated from the local currencies into U.S.
dollars at the exchange rate prevailing at the balance sheet date. Revenues,
expenses and cash flows are translated at the average exchange rate for the
period to approximate translation at the exchange rate prevailing at the dates
those elements are recognized in the financial statements. Translation
adjustments resulting from the process of translating the local currency
financial statements into U.S. dollars are included in determining comprehensive
loss. As of December 31, 2005, the exchange rate for the Euros (EUR) was $1.18
US for 1.00 EUR.

The functional currency of the Company's French subsidiaries is the local
currency. The financial statements of the subsidiary are translated to United
States dollars using period-end rates of exchange for assets and liabilities,
and the average rate of exchange for the period for revenues, costs, and
expenses. Net gains and losses resulting from foreign exchange transactions are
included in the consolidated statements of operations.

Inventories

Inventories are stated at the lower of cost or market, cost determined by the
first-in, first-out (FIFO) method. The Company writes down its inventory for
estimated obsolescence or unmarketable inventory equal to the difference between
the cost of inventory and the estimated market value based upon assumptions
about future demand and market conditions.

Inventories at December 31, 2005 consist of the following:

Finished goods                                                $ 2,164,061
Work-in-process                                                   808,384
Raw materials                                                     333,570
                                                              ------------
                                                              $ 3,306,015
                                                              ============

Goodwill

Goodwill represents the excess of costs over fair value of assets of businesses
acquired. In June 2001 the Financial Accounting Standards Board ("FASB")
approved the issuance of Statement of Financial Accounting Standards ("SFAS")
No. 141, "Business Combinations" and SFAS No. 142, "Goodwill and Other
Intangible Assets." The new standards require that all business combinations
initiated after June 30, 2001 be accounted for using the purchase method. In
addition, all intangible assets acquired that are obtained through contractual
or legal right, or are capable of being separately sold, transferred, licensed,
rented or exchanged shall be recognized as an asset apart from goodwill.
Goodwill and intangibles with indefinite lives will no longer be subject to
amortization, but will be subject to at least an annual assessment for
impairment by applying a fair value based test.

The Company's goodwill at December 31, 2005 results from its 2002 acquisition of
its Spain subsidiary. Management has established that based on future cash flows
generated from its Spain's  operations,  the Company's  goodwill at December 31,
2005 is not impaired.

                                       8

<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2005
                                   (Unaudited)

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Impairment of Long-Lived Assets

The Company reviews long-lived assets for impairment whenever circumstances and
situations change such that there is an indication that the carrying amounts may
not be recovered. In such circumstances, the Company will estimate the future
cash flows expected to result from the use of the asset and its eventual
disposition. Future cash flows are the future cash inflows expected to be
generated by an asset less the future outflows expected to be necessary to
obtain those inflows. If the sum of the expected future cash flows (undiscounted
and without interest charges) is less than the carrying amount of the asset, the
Company will recognize an impairment loss to adjust to the fair value of the
asset. At December 31, 2005, the Company believes that there has been no
impairment of its long-lived assets.

Investment

The Company's investment is reported on the equity method of accounting. Under
this method the initial investment is recorded at cost. Subsequently, the
investment is increased or decreased to reflect the Company's share of income,
losses and dividends paid.

Income per Share

The Company presents basic income per share and, if appropriate, diluted
earnings per share in accordance with the provisions of SFAS No. 128 "Earnings
per Share" ("SFAS 128").

Under SFAS 128,  basic net income  (loss) per share is computed by dividing  the
net income (loss) for the year by the weighted  average  number of common shares
outstanding  during  the year.  Diluted  net  income  per share is  computed  by
dividing  the net income for the year by the weighted  average  number of common
shares and common share equivalents outstanding during the year. The Company has
1,175,000 options  outstanding at December 31, 2005.  Additionally,  the Company
may have to issue up to 2,220,512 shares upon conversion of certain  convertible
debentures,  including  those  exchanged  during  September  2005.  Common share
equivalents  have been excluded from the computation of the diluted earnings per
share due to their anti-dilutive effect.

Fair Value of Financial Instruments

The carrying amounts of financial instruments, including cash, accounts
receivable, lines of credit and accounts payable and accrued expenses
approximate fair value at December 31, 2005 because of the relatively short
maturity of the instruments. The carrying value of, capitalized lease
obligations, long-term debt, and convertible debentures approximate fair value
at December 31, 2005 based upon terms available for companies under similar
arrangements.

                                       9

<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2005
                                   (Unaudited)

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

New Accounting Pronouncements

In November 2004, the Financial Accounting Standards Board (FASB) issued SFAS
151 "Inventory Costs". This Statement amends the guidance in ARB No. 43, Chapter
4, "Inventory Pricing, to clarify the accounting for abnormal amounts of idle
facility expense, freight, handling costs, and wasted material (spoilage). In
addition, this Statement requires that allocation of fixed production overhead
to the costs of conversion be based on the normal capacity of the production
facilities. The Company has adopted the provisions of this Statement effective
July 1, 2005.

 In June 2004, the Emerging Issues Task Force (EITF) issued EITF No. 03-01 "The
Meaning of Other-Than-Temporary Impairment and Its Application to Certain
Investments" (EITF 03-01). EITF 03-01 provides guidance with respect to
determining the meaning of other-than-temporary impairment and its application
to debt and equity securities within the scope of Statement of Financial
Accounting Standards No. 115, "Accounting for Certain Investments in Debt and
Equity Securities", including investments accounted for under the cost method
and new disclosure requirements for investments that are deemed to be
temporarily impaired. We understand the Financial Accounting Standards Board is
currently reconsidering disclosure, measurement, and recognition of
other-than-temporary impairments of debt and equity securities under EITF 03-01.
Until new guidance is issued, the disclosure requirements of EITF 03-01 were
effective for our fiscal 2005 annual consolidated financial statements.

 In December 2004, the Financial Accounting Standards Board finalized Statement
of Financial Accounting Standards No. 123R, "Share-Based Payment" (FAS 123R),
amending FAS No. 123, effective beginning our first quarter of fiscal 2006. FAS
123R will require us to expense stock options based on grant date fair value in
our financial statements. Further, the adoption of FAS 123R will require
additional accounting related to the income tax effects and additional
disclosure regarding the cash flow effects resulting from share-based payment
arrangements. The effect of expensing stock options on our results of operations
using a Black-Scholes option-pricing model is presented in our financial
statements in Note 1 -- Basis of Presentation-Stock-Based Compensation. We will
adopt FAS 123R using the modified prospective method and the adoption thereof
will have no effect on our cash flows, but is expected to have a material
adverse impact on our results of operations. We anticipate the pre-tax charge
for FAS 123R to be in the range of $250,000 to $500,000 for fiscal 2007,
however, the actual pre-tax charge could significantly differ from our estimate
if facts and assumptions used to estimate fair value during fiscal 2007
significantly differ from those used in modeling our estimate.

     In May 2005, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 154, "Accounting Changes and Error
Corrections" (FAS 154). FAS 154 replaces Accounting Principals Board Opinion No.
20 (APB 20) and Statement of Financial Accounting Standards No. 3 "Reporting
Accounting Changes in Interim Financial Statements", and applies to all
voluntary changes in accounting principle, and changes the requirements for
accounting for and reporting of a change in accounting principle. APB 20
previously required that most voluntary changes in accounting principle be
recognized by including in net income of the period of change a cumulative
effect of changing to the new accounting principle whereas FAS 154 requires
retrospective application to prior periods' financial statements of a voluntary
change in accounting principle, unless it is impracticable. FAS 154 enhances the
consistency of financial information between periods. FAS 154 will be effective
beginning the first quarter of our fiscal 2007. We do not expect the adoption of
FAS 154 will have a material impact on our financial position, results of
operations, or cash flows.

                                       10

<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2005
                                   (Unaudited)

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Provision for returns

In the normal course of business, the Company does not provide stock-balancing
or price protection rights to its distributors; however, on a non-recurring
basis, we have historically accepted product returns. The Company estimates its
provision for product returns to amount to approximately $200,000 at December
31, 2005. Management establishes provisions for estimated returns concurrently
with the recognition of revenue. The provisions are established based upon
consideration of a variety of factors, including, among other things, recent and
historical return rates for both specific distributors and projected economic
conditions.

Provision for Product Replacements

The Company provides a product replacement program on its products. The Company
provides an accrual for the estimated cost of product replacement and product
liability claims at the time revenue is recognized. Such accruals are based on
estimates, which are based on relevant factors such as historical experience,
the warranty period, estimated replacement costs, identified product quality
issues and are discounted to a current value. Management estimated the amount of
potential future product replacement claims based on statistical analysis.
Changes to actual claims and interest rates could have a material impact on the
statistical calculation which could materially impact the Company's reported
expenses and results of operations.

Management does not believe that recently issued, but not yet effective
accounting pronouncements if currently adopted would have a material effect on
the accompanying financial statements.

Concentration of Credit Risks

The Company is subject to concentrations of credit risk primarily from cash and
cash equivalents and accounts receivable. The Company maintains accounts with
French financial institutions, which at times exceeds the insured French
statutory limit of approximately $150,000. The Company minimizes its credit
risks associated with cash by periodically evaluating the credit quality of its
primary financial institutions. The Company's accounts receivables are due from
surgeons in France and from distributors in all other countries in which it
markets its products. The Company does not require collateral to secure its
accounts receivables. However, the Company regularly insures a proportion of its
accounts receivable through a financial institution. At December 31, 2005, the
financial institution insured approximately $4.0 million of the Company's
accounts receivables. One of the Company's customers accounted for approximately
14% of its net accounts receivable at December 31, 2005. No other customers
accounted for more than 10% of its net accounts receivables.


Customers Concentration Risk

Three of the Company's customers accounted for 17%, 11%and 10% of its revenues,
respectively, during the six-month ended December 31, 2005, and one of the
Company's customers accounted for 13% of its revenues, respectively, during the
six-month ended December 31, 2004. The Company minimizes its concentration risk
associated with customers by diversifying its customer base and introducing its
products in new countries.

                                       11

<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2005
                                   (Unaudited)

NOTE 4 - CONVERTIBLE DEBENTURES

On October 9, 2003, OS entered into a convertible debentures purchase agreement
(the "Agreement") with HEM Mutual Assurance, LLC ("HEM") to sell $1,000,000 of
1% convertible debentures due on October 9, 2008. Interest accrues from the date
of the transaction and was payable in cash or common stock, at the option of the
debenture holder. In the event of default, as defined in the Agreement, interest
accrued at 15% per annum. The conversion price for one convertible debenture
amounting to $498,750 was the lesser of (a) $1.25 or (b) 100% of the average
three lowest closing bid prices during the last forty trading days immediately
preceding the conversion. The conversion price for one convertible debenture
amounting to $500,000 was the lesser of (a) $1.56 or (b) 100% of the average
three lowest closing bid prices during the last forty trading days immediately
preceding the conversion. The conversion price for the third convertible
debenture amounting to $1,250 was $0.001. As part of the Agreement, OS was
required to maintain a common stock escrow account with 10,000,000 unrestricted,
free-trading shares of common stock. As part of the Company's merger with OS on
October 9, 2003, the Company assumed all the obligations and responsibilities of
the Agreement. In return for issuing the debentures to HEM, the Company received
$500,000 in December 2003 and the remaining $500,000 on January 9, 2004.

On September 9, 2005, Eurofortune Holding, S.A. ("Eurofortune"), an affiliate of
the Company's chief executive officer, purchased the three convertible
debentures issued to HEM. Simultaneously, Eurofortune exchanged the three
debentures for two convertible debentures issued by the Company each having an
aggregate principal amount of $500,000. The outstanding principal amount and
accrued interest at the rate of 1% per annum of the debentures is due and
payable on October 9, 2008. The conversion prices of the debentures are fixed at
$1.25 and $1.56. Additionally, the 10 million unrestricted free-trading shares
of the Company's common stock held in escrow were returned to the treasury.

The convertible debentures initially issued to HEM and reissued to Eurofortune,
contain an imbedded beneficial conversion feature since the fair market value of
the common stock exceeds the most beneficial exercise price on the debenture
issuance date. The value was computed as $1,000,000, which will be amortized
over the respective term of the debentures.

In April 2004, the Company sold its Senior Convertible Debenture (the
"Debenture") in the face amount of $3,000,000 to Armadillo Investments, PLC. In
consideration for the Debenture, the Company received 1,595,745 ordinary shares
of Armadillo Investments. The Company immediately sold these shares for
approximately $1,420,000. The Debenture does not bear interest. In the event of
default, as defined under the Debenture, The Debenture accrues interest at the
rate of 10% per annum. The Debenture matures on March 25, 2009. The Debenture is
convertible into our common stock at a conversion price per share of (a) four
dollars ($4.00) (the "Fixed Conversion Price") or (b) eighty percent (80%) of
the lowest closing bid price for the Common Stock in the ten (10) business days
preceding the date of conversion, but in no event less than fifty percent (50%)
of the Fixed Conversion Price (the "Floating Conversion Price"). For purposes of
determining the closing bid price on any day, reference shall be to the closing
bid price for a share of Common Stock on such date on the OTC Bulletin Board, as
reported on Bloomberg, L.P. (or similar organization or agency succeeding to its
functions of reporting prices). The Company granted piggyback registration
rights with respect to the common stock into which the Debenture is convertible.
The Company is required to maintain in escrow 750,000 shares of common stock
upon conversion of the Debenture.

The difference between the face amount of the Debenture and the proceeds
generated from the shares received in exchange of the Debentures amounted to
approximately $1,580,000 and has been recorded as a debt discount. Such debt
discount is amortized over the term of the Debenture.

                                       12

<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2005
                                   (Unaudited)

NOTE 4 - CONVERTIBLE DEBENTURES-continued

During the six-month period ended December 31, 2005 and 2004, the amortization
of the debt discount amounted to approximately $236,000 and $198,000,
respectively, and has been included in interest expense in the accompanying
consolidated financial statements.

NOTE 5 - LINES OF CREDIT

The Company entered into lines of credit agreements with two financial
institutions up to the aggregate amount of approximately $1,630,000. The Company
has used approximately $740,000 under such lines of credit at December 31, 2005.
The lines of credit bear interest at the EURIBOR rate plus 2.0% (2.107% at
December 31, 2005). The outstanding principal balance plus any interest is
payable on demand and is secured by accounts receivables of approximately $1.2
million and inventories of approximately $3.1 million.

NOTE 6 - PROMISSORY NOTE

Effective March 31, 2004, concurrent with an amended distribution agreement, the
Company issued to a subsidiary of the distributor a revolving promissory note
for certain sums to come due to Medicor based on Medicor's and the
manufacturer's administration of product replacement and related claims. The
note bears interest at the rate of 6.75% per annum. In connection with this
agreement, a subsidiary of the distributor agreed to file a pre-marketing
approval of the Company's breast implants with the Food and Drug Administration
("FDA").

During the second quarter of fiscal 2006, the distributor notified the Company
of claims that the Company owes the distributor approximately $3.3 million under
the revolving promissory note and $1,050,000 under the amended distribution
agreement. However the Company believes that there are substantial grounds for
the Company to claim that the subsidiary of the distributor is in breach of its
obligations under the amended distribution agreement thereby giving the Company
justification to withhold payment under the revolving promissory note. The
Company has provided for a provision for such claims aggregating $1,316,000 at
December 31, 2005. While the Company believes that the outcome of the dispute
of any claims will be less than the amount it has provided for such claims at
December 31, 2005, the Company has not recognized any gain or loss on
contingency in its accompanying financial statements at December 31, 2005.

NOTE 7 - LEGAL CONTINGENCIES

In October 1999, June 2000 and July 2003,  separate but related  complaints were
filed by Saul Kwartin, Ruth Kwartin,  Steven M. Kwartin, Robert Kwartin and Nina
Kwartin  against our  subsidiary  Poly  Implant  Protheses,  S.A.  ("PIP"),  III
Acquisition Corp. d/b/a PIP America,  PIP/USA, Inc., Jean Claude Mas, our former
CEO, personally, and others, in the Circuit Court of Miami-Dade County, Florida.
Plaintiffs  are all  members  of one family who  purport to be  shareholders  of
PIP/USA,  Inc., a distributor  of PIP,  suing  derivatively  on its behalf,  and
individually,  and seeking to rescind various  transactions  between PIP America
and PIP, and seeking to impose liability  against PIP and its  co-defendants for
unspecified monetary damages arising out of alleged tortious and other purported
wrongful acts concerning alleged relationships  between plaintiffs,  PIP and the
other  defendants.  Initially,  two cases were filed:  one in October of 1999 by
Saul and Ruth Kwartin and assigned  Case No.  99-25227-CA-01  and one in June of
2000 by Steven Kwartin and assigned Case No.  00-14665-CA-01.  Case No. 99-25227
was voluntarily  dismissed by the Plaintiffs,  who then unsuccessfully  tried to
withdraw  their  dismissal.  The Plaintiffs  then appealed.  In May of 2004, the
appellate  court  affirmed  the trial  court's  Order  approving  the  voluntary
dismissal.  A motion by PIP/USA and Mr. Mas to recover their  attorneys' fees is
pending in the trial court, as is a motion to disqualify the Plaintiffs' counsel
in that lawsuit.  Case No.  00-14665-CA-01 by Steven Kwartin remains pending. In
June of 2003,  Robert and Nina  Kwartin  commenced a lawsuit  assigned  Case No.

                                       13

<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2005
                                   (Unaudited)

NOTE 7 - LEGAL CONTINGENCIES-continued

03-15006.  That lawsuit  remains  pending.  In September of 2003,  Saul and Ruth
Kwartin filed another lawsuit assigned Case No. 0322537-CA-27,  alleging similar
claims to those  included  in the  dismissed  case.  Within a day or two of that
lawsuit,   Steven   Kwartin   filed  his  second   lawsuit   assigned  Case  No.
03-22399-CA-15,  against Mr. Mas and Donald McGhan only. On October 5, 2005, the
Administrative Judge transferred all of the Kwartin family lawsuits to one judge
in the Eleventh Judicial Circuit.

In November of 2003, Jessica Fischer Schnebel and fifteen other women filed a
Second Amended Consolidated Class Action Complaint against PIP, PIP/USA, Inc.
and III Acquisition Corp. d/b/a PIP America in the Circuit Court of Cook County,
Illinois. The Second Amended Consolidated Class Action Complaint contains counts
alleging product liability, breach of the implied warranties of merchantability
and fitness for a particular purpose, violation of the Illinois Consumer Fraud
Act and a contract claim alleging third-party beneficiary status. Unspecified
monetary damages, exemplary damages and attorneys fees and costs are sought.
Motions to dismiss filed by PIP and PIP America remains pending and discovery is
underway. The plaintiffs have not sought to date to certify any putative class.
Our U.S. distributor has tendered this case to PIP, for defense and indemnity
pursuant to the distributor agreement.

Marsha Dicken, et al. v. PIP/USA,  Inc., et al., Case No. 2003-05588,  was filed
in January 2003 in the District Court of Harris County, Texas. Plaintiffs allege
claims  strict  liability,   breach  of  express  warranty,  breach  of  implied
warranties,  violation  of Section  402B of the  Restatement  (Second) of Torts,
negligence,   misrepresentations,   and  violation  of  Texas'  Deceptive  Trade
Practices Act.  Plaintiffs  seek an unspecified  amount in alleged  compensatory
damages, additional statutory damages, interest,  attorneys' fees and costs. The
lawsuit is in the discovery  phase and the trial is scheduled for March of 2006.
Our  distributor,  PIP America,  has settled the lawsuit against it. PIP America
had, prior to settling, tendered this case to Poly Implant Prostheses, S.A., for
defense and  indemnity.  PIP has filed motions for summary  judgment,  which are
pending.

Heritage Worldwide, Inc. and PIP and other defendants were sued by Madeline
Sanchez in New York Supreme Court in July of 2004 for alleged product liability
and other related claims. Both Heritage Worldwide, Inc. and PIP deny any
liability to the Plaintiff and have answered the Complaint and asserted
affirmative defenses. Discovery is ongoing.

PIP and PIP America were sued by a Susan Largent in the United States District
Court for the District of New Mexico in August of 2004 for alleged product
liability and other related claims. PIP denies any liability to the Plaintiff
and has answered the Complaint and asserted affirmative defenses.

In April,  2005,  Heritage  Worldwide,  Inc. and PIP were sued in New York state
court by a New York law firm,  Morrison Cohen, for alleged unpaid legal fees and
expenses.  Heritage  removed  the  lawsuit  to federal  court,  where it remains
pending.  The parties  reached an amicable  resolution  in December 2005 and the
lawsuit is awaiting  dismissal  by the Court.  The Company has paid  $100,000 to
settle this claim.

In July 2005, IP Resource Ltd ("IP"),a British corporation sued PIP for alleged
patent infringement and claims in excess of $2.1 million in damages.

PIP is aware of two other product liability lawsuits ( one filed in February
2004 and the other one in October 2004) as well a lawsuit claiming breach of
client arising out of the sale by PIP America of the Company's products, but it
has not been served with process in any such lawsuit.

                                       14

<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2005
                                   (Unaudited)

NOTE 15 - LEGAL CONTINGENCIES (continued)

Other than certain of its own product replacement claims that it is
administering, PIP America is indemnified by PIP/USA, Inc., Poly Implants
Protheses, S.A., and Jean Claude Mas, personally, from all claims, including
those asserted above. As a result, the Company believes the costs associated
with these matters will not have a material adverse impact on the Company's
business, results of operations or financial position. The Company has recorded
a provision of approximately $780,000 at December 31, 2005 in connection with
these matters.

The Company and its subsidiaries have been and will continue to be periodically
named as a defendant in other lawsuits in the normal course of business,
including product liability and product replacement claims. Litigation,
particularly product liability litigation, can be expensive and disruptive to
normal business operations and the results of complex legal proceedings can be
very difficult to predict. Claims against the Company or its subsidiaries have
been and are periodically reviewed with counsel in the ordinary course of
business. The Company presently believes it or its subsidiaries have meritorious
defenses in all lawsuits in which the Company or any of its subsidiaries are
defendants, subject to the subsidiaries' continuing warranty obligations, which
the subsidiaries intend to continue to satisfy. While it is not possible to
predict the outcome of these matters, we believe that the costs associated with
them will not have a material adverse impact on the Company's business, results
of operations or financial position.

NOTE 8 - SEGMENT AND GEOGRAPHIC INFORMATION

The Company operates in one single market, breast implants and analyzes its
revenues derived from two geographic locations: France and the rest of the
world. The Company did not have revenues from the U.S. during the three-month
period ended December 31, 2005 and 2004. Information about the Company's sales
in different geographic locations for the three-month period ended September 30,
2005 and 2004 is shown below pursuant to the provisions of SFAS No. 131,
"Disclosures about segments of an Enterprise and Related Information."

                                      Six-month Periods
                                      Ended December 31,
                                  2005                  2004
                                ------------       ------------
France                          $ 1,027,343        $ 1,450,126
Outside of France                 5,319,410           4,507,615
                                ------------       ------------
                                $ 6,346,753        $ 5,957,741
                                ============       ============

Substantially all of the identifiable operating assets and liabilities of the
Company are within France.

                                       15

<PAGE>

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

Overview

We ceased making sales in the U.S. market in May 2000, as a result of changes in
FDA regulations. At that time, the U.S. market represented approximately $4
million, or 40% of our revenues.  We are continuing our efforts to re-enter the
U.S. by conducting extensive clinical trials, which is a prerequisite to
securing FDA approval.

We are also in the process of developing new products. We are introducing a new
product line of breast implants which is based on titanium coating. We are
completing the planning phase of our European clinical trials and anticipate
that we will market such breast implants in the European Union within 24 months.
We believe that the costs of monitoring the clinical trials will cost
approximately $500,000 over this period. We will continue to invest in research
and development to enhance and introduce new and existing products. To meet
these operational costs, we depend upon equity financings, collaborations, and
proceeds from short and long-term debt.

Critical Accounting Policies and Estimates

A summary of significant accounting policies is provided in Note 1 to our
consolidated financial statements included in our 2005 Form 10-KSB. Management
believes that the application of these policies on a consistent basis enables
the Company to provide useful and reliable financial information about the
Company's operating results and financial condition.

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

Stock-Based Compensation. We account for stock options issued to employees in
accordance with the provisions of Accounting Principles Board ("APB") Opinion
No. 25, "Accounting for Stock Issued to Employees," and related interpretations.
As such, compensation cost is measured on the date of grant as the excess of the
current market price of the underlying stock over the exercise price. Such
compensation amounts, if any, are amortized over the respective vesting periods
of the option grant. We adopted the disclosure provisions of SFAS No. 123,
"Accounting for Stock-Based Compensation" and SFAS 148, "Accounting for
Stock-Based Compensation -Transition and Disclosure", which permits entities to
provide pro forma net income (loss) and pro forma earnings (loss) per share
disclosures for employee stock option grants as if the fair-valued based method
defined in SFAS No. 123 had been applied. We account for stock options and stock
issued to non-employees for goods or services in accordance with the fair value
method of SFAS 123.

Revenues. We recognize product revenue, net of estimated sales discounts and
returns and allowances, in accordance with Staff Accounting Bulletin No. 104,
"Revenue Recognition in Financial Statements" and SFAS No. 48 "Revenue
Recognition When Right of Return Exists." These statements established that
revenue can be recognized when persuasive evidence of an arrangement exists, the
product has been shipped, all significant contractual obligations have been
satisfied, the fee is fixed or determinable and collection is reasonably
assured.

Accounts receivables and related allowance for doubtful accounts. Accounts
receivable are reported at net realizable value. We have established an
allowance for doubtful accounts based upon factors pertaining to the credit risk
of specific customers, historical trends, and other information. Delinquent
accounts are written-off when it is determined that the amounts are
uncollectible.

Inventories.  Inventories  are  stated  at the  lower  of cost or  market,  cost
determined by the first-in, first-out (FIFO) method. The Company writes down its
inventory for estimated  obsolescence  or  unmarketable  inventory  equal to the
difference  between the cost of inventory and the  estimated  market value based
upon assumptions about future demand and market conditions.

                                       16

<PAGE>

Goodwill.  At December 31, 2005, we had  approximately  $1 million in indefinite
lived  goodwill  related  to our  acquisition  of our  subsidiary  in Spain.  We
evaluate goodwill based on the future  contributing  margins of such subsidiary.
We use judgment in assessing  goodwill for impairment.  Goodwill is reviewed for
impairment  annually,  or sooner if events or changes in circumstances  indicate
that the  carrying  amount  could  exceed fair  value.  Fair values are based on
discounted  cash flows using a discount rate  determined by our management to be
consistent  with industry  discount  rates and the risks inherent in our current
business  model.  In  accordance  with SFAS No. 142, we  completed  the required
impairment  tests of goodwill at the date of adoption  and annually as required.
There were no  impairment  charges  recorded as a result of the adoption of SFAS
No. 142 or annual  impairment  tests.  Due to uncertain  market  conditions  and
potential changes in our strategy and product portfolio, it is possible that the
forecasts we use to support our goodwill could change in the future, which could
result in non-cash charges that would adversely affect our results of operations
and financial condition.

Deferred Tax Assets. We are required to estimate our income taxes in each of the
jurisdictions in which we operate as part of the process of preparing our
consolidated financial statements. At December 31, 2005, the Company has no net
deferred tax assets. SFAS No. 109, Accounting for Income Taxes, requires a
valuation allowance to reduce the deferred tax assets reported if, based on the
weight of the evidence, it is not more likely than not that some portion or all
of the deferred tax assets will be realized. Management reviews deferred tax
assets periodically for recoverability and makes estimates and judgments
regarding the expected geographic sources of taxable income, gains from
investments, as well as tax planning strategies in assessing the need for a
valuation allowance. We determined that a valuation allowance of approximately
$570,000 relating to foreign tax net operating loss carryovers was necessary to
reduce our deferred tax assets to the amount that will more likely than not be
realized. If the estimates and assumptions used in our determination change in
the future, we could be required to revise our estimates of the valuation
allowances against our deferred tax assets and adjust our provisions for
additional income taxes. In the ordinary course of global business, there are
transactions for which the ultimate tax outcome is uncertain, thus judgment is
required in determining the worldwide provision for income taxes. We provide for
income taxes on transactions based on our estimate of the probable liability. We
adjust our provision as appropriate for changes that impact our underlying
judgments. Changes that impact provision estimates include such items as
jurisdictional interpretations on tax filing positions based on the results of
tax audits and general tax authority rulings. Due to the evolving nature of tax
rules combined with the large number of jurisdictions in which we operate, it is
possible that our estimates of our tax liability and the realization of our
deferred tax assets could change in the future, which may result in additional
tax liabilities and adversely affect our results of operations, financial
condition and cash flows.

Product replacements.  We provide a product replacement program on our products.
Management  estimated the amount of potential future product  replacement claims
based on statistical analysis.  Expected future obligations are determined based
on the history of product  shipments and claims and are  discounted to a current
value.  Changes to actual claims and interest rates could have a material impact
on the  statistical  calculation  which could  materially  impact the  Company's
reported expenses and results of operations.

This discussion and analysis of our financial condition should be read in
connection with our consolidated financial statements and accompanying notes
thereto in the Company's Annual Report Form 10-KSB for the fiscal year ended
June 30, 2005, including without limitation the information set forth under the
heading "Critical Accounting Policies and Estimates".

                                       17

<PAGE>

RESULTS OF OPERATIONS

                 CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>



                                            For the Six-Month Period Ended           Increase/      Increase/
                                                    December 31,                    (Decrease)     (Decrease)
                                         ---------------------------------------  2005 vs 2004   2005 vs 2004
                                                 2005                  2004             $              %
                                         ------------------    ----------------------------------------------
<S>                                      <C>                   <C>                <C>                   <C>
Revenues                                 $       6,346,753     $      5,957,741   $    389,012          6.5%

Cost of revenues                                 2,640,067            2,873,773       (233,706)        -8.1%
                                         ------------------    ----------------------------------------------

     Gross profit                                3,706,686            3,083,968        622,718         20.2%
                                         ------------------    ----------------------------------------------

Operating expenses:
  Selling, general and administrative            2,693,638            2,072,622        621,016         30.0%
  Research and development                         521,612              528,210         (6,598)        -1.2%
                                         ------------------    ----------------------------------------------

     Total operating expenses                    3,215,250            2,600,832        614,418         23.6%
                                         ------------------    ----------------------------------------------

Income before other expenses and
     income taxes                                  491,436              483,136          8,300          1.7%
                                         ------------------    ----------------------------------------------

Other expenses:
  Other expense                                          -               (8,147)         8,147      NM
  Gain in equity investment                         20,495               30,621        (10,126)       -33.1%
  Interest expense                                (322,622)            (315,060)         7,562         -2.4%
                                         ------------------    ----------------------------------------------

     Total other expenses                         (302,127)            (292,586)        (9,541)         3.3%
                                         ------------------    ----------------------------------------------

 Income before minority interest                   189,309              190,550         (1,241)        -0.7%

Minority interest                                  (30,561)              (9,934)        20,627       -207.6%
                                         ------------------    ----------------------------------------------

Net income (loss)                        $         158,748     $        180,616   $    (21,868)       -12.1%
                                         ==================    ==============================================

</TABLE>

NM: not meaningful

                                       18

<PAGE>

Six months Ended December 31, 2005 Compared with Six  months Ended September 30,
2004

   Revenues

Revenues consist primarily of the sale of breast implants and other body support
products. The increase in revenues during the six-month period ended December
31, 2005 when compared to the prior year period is primarily attributable to
increased volume of breast implants sold to new distributors in countries other
than France, such as in Latin America, offset by a decrease in volume of breast
implants sold in France and Great Britain, and a reduction in sales price of
breast implants.

   Cost of Revenues

Cost of revenues consists primarily of materials and direct labor expenses
associated with the production of breast implants. The decrease in costs of
revenues during the six-month period ended December 31, 2005 is primarily
attributable to lower incidents of spoilage of unfinished goods when compared to
the prior year period.

   Selling and General Administrative Expenses

Selling, general and administrative expenses consist primarily of compensation
and related benefits of sales representatives which market our products as well
as general and administrative staff used to support our operations, as well as
facilities-related expenses professional fees and allowance for bad debts. The
increase in selling, general and administrative expenses during the six-month
period ended December 31, 2005 when compared to the prior year period is
primarily due to a reduction of provisions for bad debts and litigations
recorded during the six-month ended December 31, 2004. These reductions in
provisions resulted from increased level of insurance of accounts receivable
which occurred during that period as well as lower risk in negative outcome of
litigations.

   Research and Development

Research and development expenses primarily consist of compensation and related
benefits of personnel associated with the development and introduction of
existing and future product lines. The research and development expenses during
the six-month period ended December 31, 2005 is substantially comparable to the
prior year period.

   Interest Expense

Interest expense consists primarily of amortization of debt discount associated
with the issuance of convertible debentures and interest expense associated with
our lines of credit and other long-term debt. The interest expense during the
three-month period ended December 31, 2005 is substantially comparable to the
prior year period.

Liquidity and Capital Resources

During the six-month period ended December 31, 2005, we have generated cash
flows from operating activities of approximately $180,000, which is due to the
following:

o         Our net income of approximately $159,000 adjusted for non-cash items:
          debt discount of approximately $236,000, depreciation of $248,000, a
          decrease in provision for doubtful accounts of approximately $290,000.
          Additionally, our provision for product replacements decreased by
          approximately $126,000.

                                       19

<PAGE>

o         We incurred capital expenditures of approximately $130,000.
o         Our net cash provided by operating activities together with proceeds
          from issuance of long-term debt and our available cash, funded
          repayment on our lines of credit and long-term debt of approximately
          $274,000 and $98,000, respectively.

During the six-month period ended December 31, 2004, we have generated cash
flows from operating activities of approximately $348,000, which is due to the
following:

o         Our net income of approximately $180,000 adjusted for non-cash items:
          debt discount of approximately $198,000, depreciation of $116,000, a
          decrease in provision for doubtful accounts of approximately $284,000.
          Additionally, our accounts receivable and accounts payable decreased
          by approximately $862,000 and $556,000, respectively.
o         We incurred capital expenditures of approximately $235,000.
o         Our net cash provided by operating activities funded repayment on our
          long-term debt of approximately $160,000. Additionally, we generated
          proceeds of approximately $218,000 from advances from a stockholder,
          Milo Finance, SA, which was converted into shares of our subsidiary
          PIP..

New Accounting Pronouncements

In November 2004, the Financial Accounting Standards Board (FASB) issued SFAS
151 "Inventory Costs". This Statement amends the guidance in ARB No. 43, Chapter
4, "Inventory Pricing, to clarify the accounting for abnormal amounts of idle
facility expense, freight, handling costs, and wasted material (spoilage). In
addition, this Statement requires that allocation of fixed production overhead
to the costs of conversion be based on the normal capacity of the production
facilities. The Company has adopted the provisions of this Statement effective
July 1, 2005.

 In June 2004, the Emerging Issues Task Force (EITF) issued EITF No. 03-01 "The
Meaning of Other-Than-Temporary Impairment and Its Application to Certain
Investments" (EITF 03-01). EITF 03-01 provides guidance with respect to
determining the meaning of other-than-temporary impairment and its application
to debt and equity securities within the scope of Statement of Financial
Accounting Standards No. 115, "Accounting for Certain Investments in Debt and
Equity Securities", including investments accounted for under the cost method
and new disclosure requirements for investments that are deemed to be
temporarily impaired. We understand the Financial Accounting Standards Board is
currently reconsidering disclosure, measurement, and recognition of
other-than-temporary impairments of debt and equity securities under EITF 03-01.
Until new guidance is issued, the disclosure requirements of EITF 03-01 were
effective for our fiscal 2005 annual consolidated financial statements.

     In December 2004, the Financial Accounting Standards Board finalized
Statement of Financial Accounting Standards No. 123R, "Share-Based Payment" (FAS
123R), amending FAS No. 123, effective beginning our first quarter of fiscal
2006. FAS 123R will require us to expense stock options based on grant date fair
value in our financial statements. Further, the adoption of FAS 123R will
require additional accounting related to the income tax effects and additional
disclosure regarding the cash flow effects resulting from share-based payment
arrangements. The effect of expensing stock options on our results of operations
using a Black-Scholes option-pricing model is presented in our financial
statements in Note 1 -- Basis of Presentation-Stock-Based Compensation. We will
adopt FAS 123R using the modified prospective method and the adoption thereof
will have no effect on our cash flows, but is expected to have a material
adverse impact on our results of operations. We anticipate the pre-tax charge
for FAS 123R to be in the range of $250,000 to $500,000 for fiscal 2007,
however, the actual pre-tax charge could significantly differ from our estimate
if facts and assumptions used to estimate fair value during fiscal 2007
significantly differ from those used in modeling our estimate.

                                       20

<PAGE>

     In May 2005, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 154, "Accounting Changes and Error
Corrections" (FAS 154). FAS 154 replaces Accounting Principals Board Opinion No.
20 (APB 20) and Statement of Financial Accounting Standards No. 3 "Reporting
Accounting Changes in Interim Financial Statements", and applies to all
voluntary changes in accounting principle, and changes the requirements for
accounting for and reporting of a change in accounting principle. APB 20
previously required that most voluntary changes in accounting principle be
recognized by including in net income of the period of change a cumulative
effect of changing to the new accounting principle whereas FAS 154 requires
retrospective application to prior periods' financial statements of a voluntary
change in accounting principle, unless it is impracticable. FAS 154 enhances the
consistency of financial information between periods. FAS 154 will be effective
beginning the first quarter of our fiscal 2007. We do not expect the adoption of
FAS 154 will have a material impact on our financial position, results of
operations, or cash flows.

ITEM 3.     CONTROLS AND PROCEDURES

Our chief executive officer and our chief financial officer (the "Certifying
Officers") are responsible for establishing and maintaining disclosure controls
and procedures for our Company. Such officers have concluded (based upon their
evaluations of these controls and procedures as of the end of the period covered
by this report) that our disclosure controls and procedures are effective to
ensure that information required to be disclosed by us in this report is
accumulated and communicated to management, including the Certifying Officers as
appropriate, to allow timely decisions regarding required disclosure.

The Certifying Officers have also indicated that there were no significant
changes in our internal controls over financial reporting or other factors that
could significantly affect such controls subsequent to the date of their
evaluation, and there were no significant deficiencies and material weaknesses.

Our management, including the Certifying Officers, does not expect that our
disclosure controls or our internal controls will prevent all error and all
fraud. A control system, no matter how well conceived and operated, can provide
only reasonable, not absolute, assurance that the objectives of the control
system are met. In addition, the design of a control system must reflect the
fact that there are resource constraints, and the benefits of controls must be
considered relative to their costs. Because of the inherent limitations in all
control systems, no evaluation of controls can provide absolute assurance that
all control issues and instances of fraud, if any, within a company have been
detected. These inherent limitations include the realities that judgments in
decision-making can be faulty, and that breakdowns can occur because of simple
error or mistake. Additionally, controls can be circumvented by the individual
acts of some persons, by collusion of two or more people or by management
override of the control. The design of any systems of controls is also based in
part upon certain assumptions about the likelihood of future events, and there
can be no assurance that any design will succeed in achieving its stated goals
under all potential future conditions. Because of these inherent limitations in
a cost-effective control system, misstatements due to error or fraud may occur
and not be detected.



                           PART II - OTHER INFORMATION

ITEM 1.     LEGAL PROCEEDINGS

Marsha Dicken, et al. v. PIP/USA, Inc., et al., Case No. 2003-05588, was filed
in January 2003 in the District Court of Harris County, Texas. Plaintiffs allege
claims strict liability, breach of express warranty, breach of implied
warranties, violation of Section 402B of the Restatement (Second) of Torts,
negligence, misrepresentations, and violation of Texas' Deceptive Trade
Practices Act. Plaintiffs seek an unspecified amount in alleged compensatory
damages, additional statutory damages, interest, attorneys' fees and costs. The
lawsuit is in the discovery phase and the trial is scheduled for March of 2006.
Our distributor, PIP America, has settled the lawsuit against it. PIP America
had, prior to settling, tendered this case to Poly Implant Prostheses, S.A., for
defense and indemnity. PIP has filed motions for summary judgement, which are
pending.

In April, 2005, Heritage Worldwide, Inc. and PIP were sued in New York state
court by a New York law firm, Morrison Cohen, for alleged unpaid legal fees and
expenses. The parties reached an amicable resolution in December 2005 and is
awaiting dismissal by the Court. The Company paid $100,000 to Morrison Cohen as
part of the settlement.

                                       21

<PAGE>

ITEM 2.   UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None

ITEM 3.    DEFAULTS IN 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)  Exhibits

        Exhibit No.     Description
        -----------     -----------
        31.1            Certification of Chief Executive Officer pursuant to
                        Section 302 of the Sarbanes-Oxley Act of 2002.  Filed
                        herewith.
        31.2            Certification of Chief Financial Officer pursuant to
                        Section 302 of the Sarbanes-Oxley Act of 2002.  Filed
                        herewith.
        32.1            Certification of Chief Executive Officer pursuant to 18
                        U.S.C Section 1350. Filed Herewith
        32.2            Certification of Chief Financial Officer pursuant to 18
                        U.S.C Section 1350. Filed Herewith.
        99              Risk Factors
---------------------------------------

                                       22

<PAGE>

                                   SIGNATURES

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

                                                   HERITAGE WORLDWIDE, INC.
                                                         (Registrant)

Date:  February 12, 2006                           By: /s/ Alain Sereyjol-Garros
                                                       -------------------------
                                                       Alain Sereyjol-Garros
                                                       Chief Executive Officer


                                                   By: /s/ Claude Couty
                                                       -------------------------
                                                       Claude Couty
                                                       Chief Financial Officer