U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB


(Mark One)

  X   QUARTERLY  REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES  EXCHANGE
      ACT OF 1934 For the quarterly period ended April 30, 1997.

      TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT For the
      transition period from _____ to _____.

                         Commission file number 0-20722

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

           Delaware                                              16-1400479
---------------------------------                            ------------------
(State or other jurisdiction                                 (IRS Employer
 of incorporation or organization)                           Identification No.)

                  5190 Neil Road, Suite 320, Reno, Nevada 89502
                  ---------------------------------------------
                    (Address of principal executive offices)

                                 (702) 823-4000
                           ---------------------------
                           (Issuer's telephone number)

Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  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
                                                                ---
Check whether the  registrant  filed all  documents  and reports  required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the  distribution  of
securities under a plan confirmed by court.            Yes X  ; No
                                                          ---
The number of shares of Common Stock outstanding as of July 1, 1997:  18,761,839

Transitional Small Business Disclosure Format (check one):
                                                             Yes   ;  No  X
                                                                        -----


<PAGE>
PART I.  Financial Information
  
     1.  Interim Financial Statements (unaudited)

           Balance Sheet - 
               March 31, 1996 and April 30, 1997 .......................1

           Statements of Operations -
               Three months ended March 31, 1996 and April 30, 1997 ....2

           Statements of Cash Flows -
               Three months ended March 31, 1996 and April 30, 1997 ....3

           Notes to Financial Statements ...............................4

     2.  Management's Discussion and Analysis ..........................5

PART II.  Other Information

           Signatures ..................................................10

<PAGE>
                                  NEWGOLD, INC.

                                 Balance Sheets

                                   (Unaudited)

                                               March 31, 1996     April 30, 1997

                                     Assets


Cash                                          $        4,299     $      171,411


Property,plant  and  equipment  including
   undeveloped  mineral  properties  of
   $1,345,121  and  $3,767,061,  
   respectively,  net of $2,488 and $42,392
   accumulated depreciation                        1,353,633          4,717,310
Advance to stockholder                                36,809            - - -
Reclamation bonds                                    206,000            256,500
Other assets                                           3,973             16,580
                                              ---------------    --------------
     Total assets                             $    1,604,714     $    5,161,801
                                              ===============    ==============


                      Liabilities and Stockholder's Equity

Current liabilities
   Accounts payable                           $      215,195     $      437,193
   Accrued expenses                                  161,400             86,385
   Accrued reclamation costs                          94,470             25,000
   Due to affiliate                                  342,674             86,627
   Notes payable                                   1,390,944            325,000
   Shareholder loan                                  - - -              170,000
                                              ---------------    --------------

     Total current liabilities                     2,204,683          1,130,205

Deferred revenue                                     100,000            500,000
                                              ---------------    --------------

     Total liabilities                             2,304,683          1,630,205

Stockholders' equity
   Common stock - Authorized 50,000,000 
     shares par value $0.001; 6,768,658
     and 18,761,839 outstanding at March 31,
     1996 and April 30, 1997, respectively             6,769             18,762
   Additional paid-in capital                        175,231          6,944,722
   Accumulated deficit                              (881,969)        (3,431,888)
                                              ---------------    --------------

     Total stockholders' equity                     (699,969)         3,531,596


     Total liabilities 
               and stockholders' equity       $    1,604,714     $    5,161,801
                                              ===============    ==============

              See accompanying notes to the financial statements.

                                       1

<PAGE>
                                  NEWGOLD, INC.

                            Statements of Operations

                                   (Unaudited)

                           For the three months ended

                                              March 31, 1996     April 30, 1997

Sales
         Net sales                            $       -          $       -
         Cost of sales                                -                  -
                                              ---------------    --------------
               Gross Margin                           -                  -

Operating expenses
         General and administrative expenses          17,294            370,693
         Exploration costs                            -                  75,042
                                              ---------------    --------------
               Total operating expenses               17,294            445,735

               Loss from operations                  (17,294)          (445,735)

Other income (expense)
         Interest income                                                  1,738
         Other income                                                     4,445
         Interest expense                               (482)           (12,881)
                                              ---------------    --------------
                Total other expense                     (482)            (6,698)

Income tax provision                                  -                  -

Net loss                                      $      (17,776)    $     (452,433)
                                              ===============    ==============

Loss per share                                       ($0.003)           ($0.024)
                                              ===============    ==============

Weighted average number of shares outstanding      6,768,358         18,761,839
                                              ===============    ==============

              See accompanying notes to the financial statements.

                                       2
<PAGE>
                                  NEWGOLD, INC.
<TABLE>
<CAPTION>
                            Statements of Cash Flows

                                   (Unaudited)

                           For the three months ended

                                                  March 31, 1996       April 30, 1997
<S>                                               <C>                  <C>
Cash flows from operating activities
    Net loss                                      $      (17,776)       $   (452,433)
    Adjustments to reconcile net loss to net cash
      used in operating activities
       Depreciation                                          393              16,831
    Changes in operating assets and liabilities
       Refundable payroll taxes                           -                  154,357
       Prepaid expenses                                      150              -
       Other assets                                       (3,973)             (3,695)
       Accounts payable                                    5,918             267,871
       Accrued expenses                                   71,289             (59,252)
                                                      -----------          ----------

       Total adjustments to net loss                      73,777             376,112
                                                      -----------          ----------

           Net cash used by operations                    56,001             (76,321)
                                                      -----------          ----------

Cash flows from investing activities
    Repayment of advance to stockholder                  (11,170)             92,486
    Capital expenditures                                (176,182)           (860,327)
                                                      -----------          ----------

           Net cash used in investing activities        (187,352)           (767,841)

Cash flows from financing activities
    Advances from affiliate                               34,739             (31,000)
    Deferred revenue                                     100,000
    Net proceeds from stockholder loan                                       170,000
                                                      -----------          ----------

           Net cash provided by financing activities     134,739             139,000
                                                      -----------          ----------

           Net increase (decrease) in cash                 3,388            (705,162)

Cash and cash equivalents, beginning of period               911             876,573
                                                                                                                 -------

Cash and cash equivalents, end of period              $    4,299           $ 171,411
                                                      ===========          ==========
</TABLE>
              See accompanying notes to the financial statements.

                                       3
<PAGE>
NEWGOLD, INC.
NOTES TO FINANCIAL STATEMENTS

1.       Preparation of Interim Financial Statements: The accompanying financial
         statements  have been prepared in accordance  with the  instructions to
         Form  10-QSB  and,  therefore,  do  not  include  all  information  and
         footnotes necessary for a presentation of financial  position,  results
         of operations  and cash flows in  conformity  with  generally  accepted
         accounting principles. In the opinion of management,  such consolidated
         financial  statements  reflect  all  normal and  recurring  adjustments
         necessary  for a fair  presentation  of the results of  operations  and
         financial position for the interim periods presented. Operating results
         for the three month period ended April 30,  1997,  are not  necessarily
         indicative  of the  results  that may be  expected  for the fiscal year
         ended January 31, 1998.

         For further  information  see the  financial  statements  and footnotes
         included in the Company's Annual Report on Form 10-KSB for the thirteen
         months ended January 31, 1997.

2.       Income  Taxes:  No income tax  provisions  have been made due to losses
         incurred.  Deferred income tax benefits have been fully reserved due to
         the uncertainty of future realization.

3.       Net  (Loss) Per Share:  Net (loss) per share has been  computed  on the
         basis of the weighted average number of shares  outstanding  during the
         period.

4.       Reclamation of Mining Areas:  Reclamation costs,  including the removal
         of  production  facilities  at  the  end of  their  useful  lives,  are
         estimated  and  accrued on an  undiscounted  basis over the  productive
         lives of properties.  Remediation costs are expensed when the liability
         is probable and estimable.  Based on current environmental  regulations
         and known  reclamation  requirements,  management has included its best
         estimate of these obligations in its reclamation accruals.  However, it
         is reasonably  possible  that the  Company's  estimates of its ultimate
         reclamation  liabilities  could  change  as  a  result  of  changes  in
         regulations  or  cost  estimates.   The  Company  performs   concurrent
         reclamation to the extent possible.  However, most of the accrued costs
         are anticipated to be expended at the end of the mine life.


                                       4
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS

     Introduction

     The Company is engaged in the  business of acquiring  dormant,  potentially
gold-producing   properties   located  in  the  continental  United  States  and
developing such properties into commercial gold mining  operations.  The Company
is the result of a merger (the "Merger") between Warehouse Auto Centers, Inc., a
Delaware corporation ("WAC"), and Newgold,  Inc., a Nevada corporation ("NGNV"),
pursuant  to a  Plan  of  Reorganization  (the  "Plan")  approved  by  the  U.S.
Bankruptcy Court for the Western District of New York,  effective as of November
21, 1996. For accounting purposes,  under the terms of the Merger, NGNV has been
treated as the acquirer.  Accordingly, the historical financial statements prior
to  November  21,  1996  are  those  of NGNV and do not  reflect  any  financial
information  of WAC as a separate  entity.  In addition,  under the terms of the
Merger,  NGNV's  fiscal year was changed from  December 31 to January 31. Hence,
the comparative  financial  information is for the thirteen months ended January
31, 1997 to the year ended December 31, 1995.

     Financial Plan of Operation for the Next Twelve Months

     As  of  April 30, 1997, the  Company had $171,411 in cash and $($1,301,616)
in working  capital.  Based  upon  current  plans and  assumptions  relating  to
operations,  the Company will require  approximately an additional $2 million to
complete  permitting and to begin  operations and gold  production at its Relief
Canyon  Mine.  Further,  the Company will need  approximately  $500,000 to begin
production at its Mission Mine and approximately $500,000 for exploration at its
Bruner Property.  The Company is currently  pursuing several  potential  funding
opportunities  including the sale of a 1.5% net smelter return ("NSR")  relating
to the Relief Canyon Mine for approximately  $500,000;  however, the Company has
no current  commitments for additional  funding.  There can be no assurance that
any of such  opportunities  will  result in actual  funding  or that  additional
financing  will  be  available  to the  Company  when  needed,  on  commercially
reasonable  terms,  or at all.  If the  Company  is unable to obtain  additional
financing,  it will be required to curtail its  development  plans and cease its
operations.  Any additional equity financing may involve substantial dilution to
the Company's then-existing shareholders.  The Company's independent accountants
have  included  an  explanatory  paragraph  in  their  report  on the  Company's
financial statements for the thirteen months ended January 31, 1997,  indicating
substantial doubt about the Company's ability to continue as a going concern.

     At the Relief Canyon Mine,  the Company  intends to begin  operations  upon
approval of its Plan of  Operations,  issuance of a zero  discharge  permit,  an
environmental  assessment by the Nevada  Department of Environmental  Protection
and  final  approval  by the  Bureau of Land  Management  ("BLM").  The  Company
anticipates issuance of the permits during the beginning of the third quarter of
1997.  In  addition,  the  Company  must post an $800,000  reclamation  bond and
anticipates  that  its  contribution  to the  bond  will be  $300,000  with  the
remaining  $500,000  balance provided by the State of Nevada Bond Pool, of which
there  can be no  certainty.  The  recovery  facilities  are  complete  with the
exception  that an additional  leach pad will need to be built at an approximate
cost of $200,000  and  approved  by the State of Nevada and the BLM.  Mining and
loading  the new pad with  processed  ore will be  accomplished  by  third-party
contractors.  The Company has allocated $1 million for  contractor  mobilization
and operation for the initial 90 days with $500,000 held in reserve for possible
contingencies.  The Company has  personnel  in place to operate the leach system
and recovery facility, and does not expect to hire

                                        5

<PAGE>
additional employees for the Relief Canyon Mine operations.  The Company intends
to have  analyses  completed  by an  independent  engineering  firm to establish
proven  and  probable  reserves  for the  Relief  Canyon  claims  based upon the
exploration data.

     At Mission Mine,  the Company has allocated  $500,000 for  mobilization  of
contractors  to begin  operation at the Mission Mine.  In addition,  the Company
intends to engage third-party contractors to complete approximately $200,0000 in
renovations to the production  shaft of the existing  mine,  make  approximately
$50,000 in  improvements to the road to the mine and develop a Plan Of Operation
with an anticipated cost of $150,000. The Company has also allocated $100,000 to
possible  contingencies.  The Company  anticipates mining will begin in the next
twelve months using  contractors and ore will be processed at existing  off-site
mills.

     Under the terms of a letter of intent with  Miramar  Mining  Company  dated
October 11, 1996  relating to the Bruner  property,  the Company  will  complete
10,000 feet of  exploration  drilling in the next eighteen  months.  The Company
expects to spend approximately  $400,000 for exploration by drilling contractors
and $80,000 for maintenance costs of the property.

     The  Company  also  intends to  conduct  aggressive  mine site  exploration
utilizing new geologic interpretations at each of the Company's mines along with
a grass roots drilling program. In addition, non-mine site efforts will focus on
reconnaissance  efforts  to  locate  potential  mine  and  property  acquisition
candidates.  Further,  the  Company  intends  to enter  into  exploration  joint
ventures on certain of its properties during 1997. The Company estimates that it
will spend  approximately  $2 million  during the fiscal year ending January 31,
1998 in exploration.

    Actual exploration and evaluation  expenditures will vary as a result of the
acquisition of new properties, the success of exploration activities on existing
properties and the success of financing  efforts.  Spending on advanced projects
and  acquisitions,  which depends on opportunities  and  discoveries,  cannot be
projected.

     This report,  as well as certain of the notes to the financial  statements,
contain "forward- looking  statements"  within the meaning of Section 27A of the
Securities Exchange Act of 1934, as amended.  Such statements  include,  but are
not  limited  to,  (i)   expectations  as  to  the  funding  of  future  capital
expenditures  and  other  cash  needs,  (ii)  statements  as  to  the  projected
development  of certain ore deposits,  including  estimates of  development  and
other capital costs and financing plans with respect thereto, (iii) estimates of
future costs and other  liabilities for certain  environmental  matters and (iv)
statements  as to the  likelihood of the outcome of  litigation  matters.  These
forward-looking statements are subject to risks, uncertainties and other factors
that could cause actual results to differ  materially  from the  forward-looking
statements  or  the  results   projected  or  implied  by  the   forward-looking
statements.

     The amount and timing of future capital expenditures could be influenced by
a number of factors,  including  the timing of receipt of necessary  permits and
other governmental approvals, the failure of equipment,  processes or facilities
to operate in accordance with  specifications  and expectations,  labor disputes
and  unanticipated  changes in mine plans. The funding of such  expenditures and
other cash needs will be  affected  by the level of cash flow  generated  by the
Company,  if any,  and the  ability of the  Company to  otherwise  finance  such
expenditures,  which in turn could be affected by general U.S. and international
economic and political conditions,

                                        6

<PAGE>
political  and economic  conditions in the country in which the  expenditure  is
being made, as well as financial market conditions.

     The  development  of certain ore deposits could be affected by, among other
things, labor disputes, delays in the receipt of or failure to receive necessary
governmental  permits  or  approvals,   changes  in  U.S.  or  foreign  laws  or
regulations or the interpretation,  enforcement or implementation  thereof,  the
failure of any of the  Company's  joint  venture  partners  to perform as agreed
under  the  relevant  agreements  or any  termination  of any  such  agreements,
unanticipated ground and water conditions,  the failure of equipment,  processes
or facilities to operate in accordance with  specifications or expectations,  or
delays in the receipt of or the ability to obtain necessary financing.

     Future  environmental costs and liabilities could be impacted by changes in
U.S.  or foreign  laws or  regulations  or the  interpretation,  enforcement  or
implementation thereof and other factors beyond the control of the Company.

     For a more detailed  discussion of the foregoing risks and uncertainties as
well as other risks and uncertainties  affecting the Company and its operations,
see  "Cautionary  Statement  for Purposes of the Safe Harbor  Provisions  of the
Private Securities  Litigation Reform Act of 1995." and "Risk Factors" contained
in Item 1 and 2 of the  Company's  Annual  Report on Form  10-KSB for the period
ended  January 31, 1997,  as well as other filings made by the Company from time
to time with the Securities and Exchange  Commission.  Many of these factors are
beyond the Company's ability to control or predict. Readers are cautioned not to
put undue  reliance on  forward-looking  statements.  The Company  disclaims any
intent or obligation to update publicly any forward-looking statements set forth
in this  discussion,  whether as a result of new  information,  future events or
otherwise.

                                        7

<PAGE>
PART II.  OTHER INFORMATION

Item 1.  Legal Proceedings

       a) On December 3, 1996, the case of  Christiansen  v. Newgold,  et al., a
purported  breach of contract action was filed in the Second Judicial  District,
Washoe County, Reno, Nevada. Plaintiff alleges that he is owed $250,000 relating
to  recovery  of his  investment  with a property  subsequently  acquired by the
Company.  The Company believes that Plaintiff's claim is meritless and the claim
is being vigorously defended by counsel.

       b) On January  28,  1997,  the case of Stewart v.  Newgold,  a  purported
breach of contract for the purchase of the Cerro Gordo Mine in  California,  was
filed in the Second Judicial District,  Washoe County,  Reno, Nevada.  Plaintiff
was unable to present  clear title to the property and the Company was unable to
clear  title  and  refused  to make  additional  payments  called  for under the
contract.  Plaintiff is seeking $40,000 in damages.  This case is in the initial
pleadings stage and is being vigorously defended by counsel.

       c) On April 25, 1997,  the Company filed a  declaratory  relief action in
the case of Newgold v. Wirsing,  et al. in the Sacramento County Superior Court.
Mr. Wirsing and his fellow defendant,  Mr. Wong, are each alleging that they are
the owners of a 10% share of the net profits  interest from Relief  Canyon.  The
Company  filed the action to seek  declaratory  relief that Messrs.  Wirsing and
Wong's claim is without merit. Mr. Wong has filed a $100,000,000  mechanics lien
on the Relief  Canyon Mine.  The Company  believes  that the use of a mechanics'
lien is  improper  and that  there is no merit in  Messrs.  Wirsing  and  Wong's
claims. However, to the extent that Messrs. Wirsing and Wong are successful,  it
could have a material adverse effect on the Company.

Item 2.  Changes in Securities

       None.

Item 3.  Defaults on Senior Securities

       None.

Item 4.  Matters Submitted to a Vote of Security Holders

       None.

Item 5.  Other Information.

       None.










                                       8

<PAGE>
Item 6.  Exhibits and Reports on From 8-K

       a) Exhibits

       Exhibit 3.1            Certificate of Incorporation of the Registrant(1)

       Exhibit 3.2            Certificate of Amendment to Certificate of
                              Incorporation of the Registrant(2)

       Exhibit 3.3            Bylaws of the Registrant(1)

       Exhibit 27             Financial Data Schedule


       (1)      Incorporated  by  reference  to  the  Registrant's  Registration
                Statement  on Form  SB-2  (File  No.  33-49920)  filed  with the
                Commission on October 14, 1993.

       (2)      Incorporated by reference to the Registrant's  Annual
                Report on Form  10-KSB-40  for the fiscal  year ended
                January 31, 1996 filed with the Commission on January
                           22, 1997.


       b) Reports on Form 8-K

                A current  report was filed on March 12,  1997,  to announce the
                approval of the Plan of  Reorganization  by the U.S.  Bankruptcy
                Court and the merger of Newgold, Inc., a Nevada corporation, and
                the Registrant on November 21, 1996.





















                                        9

<PAGE>
                                   SIGNATURES



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


NEWGOLD, INC.


                                                   Date:  July 3, 1997
/s/  A. Scott Dockter
---------------------------
A. Scott Dockter
Chief Executive Officer

                                                   Date:  July 3, 1997
/s/  Robert W. Morris
---------------------------
Robert W. Morris
Principal Financial Officer









                                        7

<PAGE>
                                  EXHIBIT INDEX

Exhibit
Number                                    Description

3.1               Certificate of Incorporation of the Registrant(1)

3.2               Certificate of Amendment  to  Certificate of  Incorporation of
                  the Registrant(2)

3.3               Bylaws of the Registrant(1)

27                Financial Data Schedule

----------

(1)      Incorporated by reference to the Registrant's Registration Statement on
         Form SB-2 (File No. 33-49920)  filed with the Commission on October 14,
         1993.

(2)      Incorporated  by reference to the  Registrant's  Annual  Report on Form
         10-KSB-40  for the fiscal  year ended  January  31, 1996 filed with the
         Commission on January 22, 1997.