UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C., 20549

                                   FORM 10-QSB/A

                                   (Mark one)
           [X] Quarterly Report Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934

                   FOR THE FISCAL QUARTER ENDED MARCH 31, 2004

                         Commission file Number 0-28416
                                       or
          [  ] Transition Report Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934

==============================================================================
                                  VALCOM,  INC.
       (Name  of  small  business  issuer  specified  in  its  charter)
==============================================================================
         Delaware                                  58-1700840
         --------                                  ----------
(State  or  other  jurisdiction  of               (IRS  Employer
incorporation  or  organization)                  Identification  Number)



            28309 Ave. Crocker, Valencia, California 91355
            ---------------------------------------------------------
               (Address of Principal executive offices) (Zip code)

                                 (661)  257-8000
                             -----------------------
                            Issuer's telephone number

            Securities registered pursuant to 12(b) of the Act: None
        Securities to be registered pursuant to Section 12(g) of the Act:

                          COMMON STOCK $0.001 PAR VALUE
                          -----------------------------
                                (Title of Class)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding  12  months  (or  for such shorter period that the registrant was
required  to  file  such  reports),  and  (2)  has  been  subject to such filing
requirements  for  the  past  90  days.  YES  [  X  ]  NO  [  ]

As  of  March  31, 2004 the issuer had 15,182,553 shares of its $0.001 par value
common  stock  outstanding.

<PAGE>

UNAUDITED  INTERIM  FINANCIAL  STATEMENTS

The  accompanying  financial  statements  are  unaudited  and  are  prepared  in
accordance  with rules and regulations of the Securities and Exchange Commission
for interim quarterly reporting.  Accordingly, these financial statements do not
include all disclosures required under generally accepted accounting principles.
In the opinion of management, the accompanying consolidated financial statements
contain  all  adjustments  (which  include  only  normal  recurring adjustments)
necessary  to  present  fairly  the  financial  position  of  ValCom,  Inc.  and
subsidiaries as of March 31, 2004, and the results of their operations and their
cash  flows  for  the  three  months  ended  March 31, 2004.  These consolidated
financial  statements  include  the  accounts of ValCom, Inc. and its subsidiary
companies  (together  "the Company").   Results for the three months ended March
31,  2004,  are  not  necessarily  indicative of the operations, which may occur
during the year ending September 30, 2004.  Refer to the Company's Annual Report
on  Form  10-KSB  for the year ended September 30, 2003 for further information.

                                       -2-

<PAGE>
                                  VALCOM, INC.

                                   FORM 10-QSB
                                      INDEX
                                                                  Page
PART  I.    FINANCIAL  INFORMATION

Item  1.   Condensed  Consolidated  Financial  Statements:
           Condensed  Consolidated  Balance  Sheet  as  of
             March  31,  2004  (unaudited)
                                                                     3

           Condensed  Consolidated  Statements  of  Operations
            for the three and six months ended March 31, 2004
            and  2003  (unaudited)
                                                                     5

           Condensed  Consolidated  Statements  of  Cash  Flows
             for  the  six  months  ended  March  31,  2004  and
             2003  (unaudited)                                       6

           Notes  to  Condensed  Consolidated  Financial  State-
             ments  (unaudited)                                      7

Item  2.    Management's  Discussion  and  Analysis  of  Financial
             Condition  and  Results  of  Operations                 16

Item  3.    Disclosure  Controls  and  Procedures                    18

Part  II.   OTHER  INFORMATION

Item  1.    Legal  Proceedings                                       19

Item  2.    Changes  in  Securities                                  19

Item  3.    Defaults  Upon  Senior  Securities                       20

Item  4.    Submission of Matters to a Vote of Security Holders      20

Item  5.    Other  Information                                       20

Item  6.    Exhibits  and  Reports  on  Form  8-K                    20

SIGNATURES                                                           21

Part  III.  EXHIBITS

                                       -3-

<PAGE>
PART  I.  FINANCIAL  INFORMATION

ITEM  1.  FINANCIAL  STATEMENTS
                          VALCOM, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEET
                                 (UNAUDITED)

                                                     March  31,
                                                       2004
                                                      ------
                                     ASSETS         (Unaudited)
                                     ------
Current  assets:
Cash  &  Cash  equivalents                         $   229,723
Accounts  receivable,  net                              51,827
Note  receivable,  current                              17,590
                                                   -----------
Total  current  assets                                 299,140

Property  and  equipment  -  net                    12,965,255
Deferred  Compensation                                 225,658
Prepaid  development  costs                            440,739
Deposits  and  other  assets                           300,684
                                                  ------------
Total  assets                                    $  14,231,476
                                                  ============

See accompanying notes to the condensed consolidated financial
statements
                                       -4-

<PAGE>
                          VALCOM, INC. AND SUBSIDIARIES
                CONDENSED CONSOLIDATED BALANCE SHEET (CONTINUED)
                                  (UNAUDITED)

                      LIABILITIES AND STOCKHOLDERS' EQUITY
                      ------------------------------------
Liabilities  not  subject  to  compromise
Current  liabilities:
Accounts  payable                                $   354,756
Accrued  interest                                    324,753
Accrued  expenses                                    293,892
Advanced rent                                        272,100
Due  to  related  parties                            431,538
Notes  payable                                        14,043
Notes payable - Laurus                             9,812,966
-------------------------------------------------------------
Liabilities subject to compromise
----------------------------------
Prepetition trade accounts payable                   206,249
Prepetition payable due to related parties            95,000
Prepetition accured expenses                         131,902
                                                -------------
Total  current liabilities                        11,937,199
-------------------------------------------------------------
Mortgage payable-nevada                            2,519,536

Total lablilties                                  14,456,536
-------------------------------------------------------------
Commitments  and  contingencies

Stockholders'  deficit:
Convertible  preferred  stock:  all  with  par  value
$0.001;
Series  B,  1,000,000  shares  authorized;  38,000
shares  issued  and  outstanding                            38
Series  C,  5,000,000  shares  authorized;  1,480,000
shares  issued  and  outstanding                         1,480
Series  D,  1,250,000  shares  authorized;1,250,000
shares  issued  and  outstanding                             -
Common  stock,  par  value  $.001;  100,000,000  shares
authorized;  21,144,913
shares  issued  and  outstanding                        21,144
Additional  paid-in  capital                        15,354,666
Preferred stock to be issued
Accumulated  deficit                               (15,602,388)

Total  Stockholders'  deficit                         (225,060)
                                                   -----------
Total  Liabilities  and  Stockholders'  deficit     $14,231,476
                                                   ===========

    See accompanying notes to the condensed consolidated financial statements
                                       -5-

<PAGE>

                          VALCOM, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)


<TABLE>
<CAPTION>
                                      For the three              For the three
                                      months ended               months ended
                                      March 31, 2004             March 31, 2003
<S>                                  <C>                         <C>
Revenue:
Rental . . . . . . . . . . . .       .$  1,093,775                $1,023,027
Production . . . . . . . . . .       . .    59,185                   202,969
Other. . . . . . . . . . . . .       . .     5,837                    76,573
                                   -----------------------------------------
               . . . . . .       . .     1,158,797                 1,302,569
                                   -----------------------------------------

Cost and expenses:
Production . . . . . . . . . .              16,703                   255,716
Impairment of property & equipment       1,438,250                      -
Litigation accrual                       1,405,656                      -
Selling and promotion                       29,564		      14,468
Depreciation and amortization.             470,167                   176,275
General and administrative . .           1,702,150                 2,065,744
Consulting and professional services        14,519
                                   -----------------            ------------
Total Cost and Expenses. . .             5,577,150                 2,512,203
                                   -----------------------------------------

Operating loss . . . . . . .            (4,418,212)               (1,209,634)

Other income (expense):
       Interest expense net               (681,377)                 (571,413)
       Gain on sale of assets               60,230                    27,642
       Loss on equity investment            (6,679)                      -
Other income                                    -                     50,000
                                   -----------------------------------------
Total other income (expense) . .          (627,826)                 (493,771)

                             -----------------------------------------------
Net loss . . . . . . . .  .       . .$  (5,046,038)            $  (1,703,405
                             ===============================================

    Basic and diluted loss per share from continuing
    operations . . . . . . . . .
                                     $      ( 0.26)            $    ( 0.14)
                                    --------------------   -----------------
    Weighted average shares outstanding
    basic and diluted                     19,170,824             11,487,280

</TABLE>

    See accompanying notes to the condensed consolidated financial statements
                                       -6-

<PAGE>
                          VALCOM, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)


<TABLE>
<CAPTION>


                                      For the three              For the three
                                      months ended               months ended
                                      March 31, 2004             March 31, 2003
<S>                                  <c>                         <C>
Net revenue:
Rental . . . . . . . . . . . .        $    494,137                $  459,372
Production . . . . . . . . . .              28,948                    80,077
Other. . . . . . . . . . . . .               3,497                     1,809
                                   -----------------------------------------
Total net revenues                         526,582                   537,640
                                   -----------------------------------------

Cost and expenses:
Production . . . . . . . . . .               5,761                    64,693
Impairment of property & equipment       1,438,250                       -
Litigation accrual                       1,405,656                       -
Selling and promotion                       15,592                     2,051
Depreciation and amortization.             382,329                    88,535
General and administrative . .           1,021,366                   982,107
Consulting and professional services       371,950                       -

Total cost and expenses. . .             4,640,902                 1,137,386
                                   -----------------------------------------

Operating loss . . . . . . .            (4,114,320)                 (599,746)e
Other income (expense):
       Interest expense      .            (413,785)                 (376,933)
       Impairment of property              (53,950)                   19,642
       Loss on equity Investment                 0                    50,000
       Other income
                                   -----------------------------------------
Total other income (expense) net          (413,785)                 (396,575)
Gain on sale of assets                       6,280                    19,642
                             -----------------------------------------------
Net loss . . . . . . . .  .          $  (4,521,825)            $    (926,679)
                             ===============================================

    Basic and diluted loss per share from continuing
    operations . . . . . . . .
                                     $     ( 0.23)             $     ( 0.08)
    Weighted average shares outstanding
    basic and diluted.                   19,018,382               11,816,467

</TABLE>

    See accompanying notes to the condensed consolidated financial statements
                                       -7-

<PAGE>
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                  (UNAUDITED)
<TABLE>
<CAPTION>


                                                                          For the six       For the six
                                                                          months ended      months ended
                                                                          March 31, 2004    March 31, 2003
                                                                      ----------------  ----------------
<S>                                                                   <C>                <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss) income                                                       $(5,046,038)      $(1,703,405)
Adjustments to reconcile net loss to net cash used in operating
activities:
Impairment of property and equipment                                      1,438,250
Depreciation and amortization                                               470,176           176,275
Bad debt expense                                                               -               70,313
Gain on sale of fixed assets                                                (60,230)          (27,642)
Stock issued for retirement debt . . . . . . . . . . . . . . . . . . . . . . 57,959
Stock issued for interest payable                                             3,000
Stock issued for compensation. . . . . . . . . . . . . . . .                715,458           170,351

Changes in operating assets and liabilities:
Receivables . . . . . . . . . . . . . . . .  . . . . . . . . . . . . . .     20,080           (14,952)
Prepaid expenses                                                           (287,679)          (31,897)
Other assets                                                                                  195,987
Deferred compensation . . . . . . . . . . .  . . . . . . . . . . . .         33,022           112,846
Deposits                                                                   (185,146)          (   875)
Accounts payable and accrued expenses . . .  . . . . . . . . . . . . . .  1,964,469           549,904
                                                                          ------------  --------------
Net Cash Used by Operating Activities . . .  . . . . . . . . . . . . .   (  876,688)        ( 503,240)
                                                                         -------------  ---------------

CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of property and equipment. . . . . . . . . . . . . . . . . . (  332,047)           (3,899)
Repayments of note receivable . . . . . . . . . . . . . . . . . . . . . .    35,178            55,179
Proceeds from sale property and equipment . . . . . . . . . . . . . . . .    63,700            50,179
                                                                         -------------  --------------
Net Cash Provided by Investing Activities. . . . . . . . . . . . . . . . (  233,169)          101,439
                                                                         -------------  --------------

CASH FLOWS FROM FINANCING ACTIVITIES:
Cash proceeds from sale of stock                                            467,500
Stock issued for options exercised                                          232,000
Principal repayment of notes payable  . . . . . . . . . . . . . . . .    (   68,883)         (107,827)
Principal borrowings on notes payable and mortgages   . . . . . . . .       100,000           234,463
Due to related parties. . . . . . . . . . . . . . . . . . . . . . . .       397,281           (28,539)
Net cash provided by financing activities . . . . . . . .           .    (1,127,898            98,097
                                                                         --------------    -----------
NET INCREASE (DECREASE) IN CASH . . . . . . . . . . . . . . . . .  .         18,041          (303,704)

CASH AT BEGINNING OF PERIOD . . . . . . . . . . . . . . . . . . .  .        211,682           343,374
                                                                        -------------  ---------------
CASH AT END OF PERIOD . . . . . . . . . . . . . . . . . . . . . . ..  $     229,723   $        39,670
                                                                     ================ ================

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
---------------------------------------------------------------------------
Interest paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . $     347,824   $       193,250
                                                                        --------------   -------------
Income taxes paid . . . . . . . . . . . . . . . . . . . . . . . . . . $           0   $             0
                                                                        --------------  --------------
</TABLE>

    See accompanying notes to the condensed consolidated financial statements
                                       -8-

<PAGE>
                          VALCOM, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

NOTE  1  BANKRUPTCY PROCEEDINGS,DESCRIPTION  OF BUSINESS AND SUMMARY OF
         SIGNIFICANT ACCOUNTING POLICIES
--------------------------------------------------------------------------------

on April 7, 2003, the Company filed on an emergency basis a voluntary Chapter 11
bankruptcy  petition.

The  Company's requires the use of its secured creditor's
cash  collateral  to  operate. Throughout the pendency of this case, the Company
has  worked with its two real estate secured lenders, Finance Unlimited, LLC and
Laurus  Master  Fund,  Limited on the details of cash collateral stipulation. An
order  approving  a  global  interim  cash  collateral  stipulation with Finance
Unlimited Finance and Laurus was entered on August 26, 2003. This stipulation
permitted the  Company's  use  of  the  lenders'  cash  collateral through
March 31, 2004.

On  January  15,  2004,  the  Court  approved  two  additional  cash  collateral
stipulations,  one  each  with  Finance  Unlimited  and  Laurus, authorizing the
Company's  continued  use  of  cash  collateral  through  March 31, 2004 (Second
Interim  Stipulation).  The  Second Interim Stipulation generally grants Finance
Unlimited  and  Laurus relief from the automatic bankruptcy stay effective March
31,  2004,  and  the right to hold foreclosures sales on their real and personal
property  collateral  as  early  as  April  1,  2004.

In  May  2004, Laurus paid off Finance Unlimited and was subrogated to Finance's
$6,565,998  claim,  which  became  included in the senior of Laurus' two claims.
Laurus  then  sought to conduct a non-judicial foreclosure sale of the Property,
and  VEI  objected.  The  Bankruptcy Court issued an order on June 3, 2004, that
while  Laurus  could  conduct  a  non-judicial foreclosure sale of the Property,
Laurus  would  not  be  entitled  to  any deficiency claim against either VEI or
ValCom,  or  any  other assets other than the Property itself (and the rents and
leases  appurtenant  thereto).

On  June  10,  2004,  the  court  ordered the Property to be sold. At this sale,
Laurus  claimed  that its senior note had a balance of $7,407,873 and its junior
note  a  balance  of  $2,405,093. Virtually all of the disputed penalties, along
with  a  disproportionate  share  of  disputed  legal  fees  and  expenses, were
incorporated  into  the junior balance, while the senior included the $6,565,998
million  subrogated  from  the Finance claim. The sale was conducted through the
junior  note,  and  the  Property was sold for $2.9 million to a third party. An
affiliate  of  this  third  party  then  purchased the senior note directly from
Laurus,  without  a  second  sale.

As a result of the Bankruptcy Court's order and the subsequent trustee's sale of
the  Property,  neither VEI nor ValCom are subject to any further liabilities on
account  of  the notes and deeds of trust previously held by Finance and Laurus.
Even  though  the  senior  note  still  technically exists, it has been rendered
non-recourse by the Bankruptcy Court's order, and could only be enforced against
the  Property itself (which no longer belongs to VEI). Any liability owed to the
third  party,  which  purchased the Property with regard to the rents, collected
for  June  2004  has  been  resolved  by  settlement  with  that  party.

On August 3, 2004, the Bankruptcy Court granted the motion for dismissal of
Chapter 11 bankruptcy case against the Company.

DESCRIPTION  OF  BUSINESS
-------------------------
ValCom,  Inc.  and  subsidiaries  (the  "Company"), formerly SBI Communications,
Inc., was originally organized in the State of Utah on September 23, 1983, under
the  corporate name of Alpine Survival Products, Inc.  Its name was subsequently
changed  to  Supermin,  Inc.  on  November  20,  1985.  On  September  29, 1986,
Satellite  Bingo,  Inc.  became  the  surviving  corporate entity in a statutory
merger  with  Supermin,  Inc.  In  connection  with the above merger, the former
shareholders  of Satellite Bingo, Inc. acquired control of the merged entity and
changed  the  corporate  name  to Satellite Bingo, Inc.  On January 1, 1993, the
Company  executed  a plan of merger that effectively changed the Company's state
of  domicile from Utah to Delaware. Through shareholder approval dated March 10,
1998,  the  name  was  changed  to  SBI  Communications,  Inc.

In  October 2000, the Company was issued 7,570,997 shares by SBI for 100% of the
shares  outstanding  in  Valencia  Entertainment  International,  LLC ("VEI"), a
California limited liability company. This acquisition has been accounted for as
a  reverse  acquisition  merger with VEI as the surviving entity.  The corporate
name  was  changed  to  ValCom,  Inc.  effective  March  21,  2001.

The  Company is a diversified entertainment company with the following operating
activities:

a)  Studio  rental  -  The  Company  and  its subsidiary, Valencia Entertainment
International,  LLC,  operated  eight sound stages in Valencia, California until
June  10,2004  when  six  of  the sound stages were sold off to pay the debts of
Laurus  and  Finance  Unlimited.  The Company leases the other two sound stages.
Beginning  June  2003, the Company and its subsidiary signed one-year lease with
five  one-year  options for its sound stages. The Company has acquired seven and
one  half  acres  of  property  in Nevada with 162,000 square feet of buildings,
which  are  being  renovated  into  seven sound stages for rental. The Company's
subsidiary,  Half  Day  Video,  Inc.,  supplies  personnel,  cameras,  and other
production  equipment  to  various  production  companies on a short-term basis.

b)  Film,  TV, & Animation Production -The Company, in addition to producing its
own  television  and  motion  picture
programming,  has  an exclusive facilities agreement in place for productions in
Los  Angeles  County  for  a  three-year  term  with  Woody  Fraser/Woody Fraser
Productions.

c)  Broadcast  Television  -  The  Company  owns a 45% equity interest in ValCom
Broadcasting,  LLC,  a  New  York limited liability company, which operates KVPS
(Channel  8),  an  independent  television  broadcaster  in  the  Palm  Springs,
California  market,  which  is strategically located in the middle of four major
markets  including  Los  Angeles,  Phoenix,  Las  Vegas  and  San  Diego. This
interest was sold to Eye Span Entertainment Network, Inc. on February 16, 2004

    See accompanying notes to the condensed consolidated financial statements
                                       -9-

<PAGE>
                          VALCOM, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)


BASIS  OF  PRESENTATION
-----------------------
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 and related
notes  included  in  the  Company's  Form  10-KSB.

The  audited consolidated financial statements of the Company for the year ended
September  30,  2003  were  filed  on  February 13, 2004 with the Securities and
Exchange  Commission  and  are hereby referenced.  In the opinion of management,
the  accompanying  unaudited  consolidated  financial  statements  contain  all
adjustments  (consisting only of normal recurring accruals) considered necessary
for  fair  presentation has been included. The results of operations for the six
months  ended March 31, 2004 are not necessarily indicative of the results to be
expected  for  the  entire  year.

Following is a summary of the significant accounting policies followed in the
prepartion of these consolidated financial statements, which policies are in
accordanc with accounting principles generally accepted in the United States of
America.


PRINCIPLES  OF  CONSOLIDATION
-----------------------------
The  consolidated  financial statements include the accounts of ValCom, Inc. and
two  wholly-owned subsidiaries, Valencia Entertainment International, LLC, which
was  acquired  effective  February  2001  and  Half  Day  Video, Inc., which was
acquired  effective  March  2001.

Investments  in  affiliated  companies  over which the Company has a significant
influence  or  ownership  of  more  than  20%  but less than or equal to 50% are
accounted  for  under  the  equity  method.

USE  OF  ESTIMATES
------------------
The  preparation  of  consolidated  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 disclosure of contingent assets
and  liabilities  at  the  date of the consolidated financial statements and the
reported  amounts  of  revenue and expenses during the reporting period.  Actual
results  could  materially  differ  from  those  estimates.

CONCENTRATIONS  AND  CREDIT  RISK
---------------------------------
The  Company  has  two  customers  who  accounted for approximately 99% of total
rental  revenues for the six months ended March 31, 2004 and 2003, respectively.
As  of  March  31,  2004,  all  eight  sound  and  production  stages were under
non-cancelable  operating  leases  for  one  year  from  two  major  production
companies.

Financial  instruments that potentially subject the Company to concentrations of
risk  consist  of trade receivables principally arising from monthly leases from
television  producers.  The  Company continuously monitors the credit-worthiness
of  its  customers  to  minimize  its  credit  risk.

FAIR  VALUE  OF  FINANCIAL  INSTRUMENTS
---------------------------------------
Statement of financial accounting standard No. 107, Disclosures about fair value
of  financial  instruments  requires  that  the  Company disclose estimated fair
values  of  financial  instruments.  The  carrying  amounts  reported  in  the
statements  of  financial  position  for  current assets and current liabilities
qualifying  as  financial  instruments  are a reasonable estimate of fair value.

    See accompanying notes to the condensed consolidated financial statements
                                      -10-

<PAGE>
                          VALCOM, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)

IMPAIRMENT  OF  LONG-LIVED  ASSETS
----------------------------------
Effective January 1, 2003, the Company adopted Statement of Financial Accounting
Standards  No.  144,  "Accounting  for  the Impairment or Disposal of Long-Lived
Assets" ("SFAS 144"), which addresses financial accounting and reporting for the
impairment  or  disposal  of  long-lived  assets  and  supersedes  SFAS No. 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to
be  Disposed Of," and the accounting and reporting provisions of APB Opinion No.
30,  "Reporting  the  Results  of  Operations  for  a Disposal of a Segment of a
Business."  The  Company periodically evaluates the carrying value of long-lived
assets  to  be  held  and  used  in accordance with SFAS 144.  SFAS 144 requires
impairment  losses  to  be recorded on long-lived assets used in operations when
indicators  of  impairment are present and the undiscounted cash flows estimated
to  be generated by those assets are less than the assets' carrying amounts.  In
that  event,  a  loss  is  recognized  based on the amount by which the carrying
amount  exceeds  the  fair  market  value  of  the  long-lived  assets.  Loss on
long-lived  assets  to  be disposed of is determined in a similar manner, except
that  fair  market  values  are  reduced for the cost of disposal.

REVENUE  RECOGNITION
--------------------
Revenues  from  studio  and  equipment  rentals  are recognized ratably over the
contract  terms.  Revenues  from  the  production  and  licensing  of television
programming  are  recognized when the films or series are available for telecast
and certain contractual terms of the related production and licensing agreements
have  been  met.

EQUITY  INVESTMENT
------------------
The Company accounts for its investments in companies over which the Company has
significant  influence  or  ownership of more than 20% but less than or equal to
50%  under  the  equity  method.

GOING CONCERN
-------------------------------------------------------

The  accompanying  consolidated financial statements have been prepared assuming
that  the  Company will continue as a going concern.  The Company has a net loss
to  date  of  $5,046,083  and  a working capital deficiency of $11,638,059 and
an accumulated  deficit  of  $15,602,388  at March 31, 2004. The Company
had a net loss  of  $5,046,038  for  the  six months  ended  March  31,  2004.

Valencia  Entertainment  International,  LLC,  a  California  limited  liability
company  and  the  Registrant's  subsidiary  filed on April 7, 2003, a voluntary
petition  in  bankruptcy  for  reorganization  under  Chapter  11  of  the  U.S.
Bankruptcy  Code in the United States Bankruptcy Court for the Southern District
of  California  (note  8).  The  main  income  of  the  Registrant  is  from the
operations of Valencia Entertainment International. These conditions raise doubt
about  the Company's ability to continue as a going concern if suitable remedies
are  not  undertaken.

Management has taken varioussteps to revise its operating and financial
requirments, which it believes are sufdficient to provide the Company with
the ability to continue on in twelve months. Management devoted considerable
effort during the period ended March 31, 2004, towards management of liablities
and improving the operations. The management believes that the above actions
will allow the Company to continue its operations through the next twelve
months.


    See accompanying notes to the condensed consolidated financial statements
                                      -11-

<PAGE>
                          VALCOM, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)
                                   -----------

NEW  ACCOUNTING  PRONOUNCEMENTS
-------------------------------

On  May 15 2003, the FASB issued FASB Statement No. 150 ("SFAS 150"), Accounting
for  Certain  Financial Instruments with Characteristics of both Liabilities and
Equity.  SFAS 150 changes the accounting for certain financial instruments that,
under previous guidance, could be classified as equity or "mezzanine" equity, by
now  requiring  those  instruments to be classified as liabilities (or assets in
some  circumstances)  in  the statement of financial position. Further, SFAS 150
requires  disclosure  regarding  the  terms  of those instruments and settlement
alternatives.  SFAS  150  affects  an  entity's  classification of the following
freestanding  instruments:  a)  Mandatorily  redeemable instruments b) Financial
instruments  to  repurchase  an  entity's  own  equity  instruments c) Financial
instruments embodying obligations that the issuer must or could choose to settle
by  issuing  a  variable  number of its shares or other equity instruments based
solely on (i) a fixed monetary amount known at inception or (ii) something other
than  changes  in  its  own  equity  instruments  d)  SFAS 150 does not apply to
features  embedded  in  a  financial  instrument that is not a derivative in its
entirety.  The  guidance  in  SFAS  150 is generally effective for all financial
instruments  entered  into  or  modified  after  May  31, 2003, and is otherwise
effective  at the beginning of the first interim period beginning after June 15,
2003.  For  private  companies, mandatorily redeemable financial instruments are
subject  to  the  provisions  of  SFAS 150 for the fiscal period beginning after
December  15,  2003. The adoption of SFAS No. 150 does not have a material
impact on the Company's financial position or results of operations or
cash  flows.

In  December  2003,  the  Financial  Accounting  Standards Board (FASB) issued a
revised  Interpretation  No.  46,  "Consolidation of Variable Interest Entities"
(FIN  46R).  FIN 46R addresses consolidation by business enterprises of variable
interest  entities  and  significantly  changes the consolidation application of
consolidation  policies  to  variable  interest  entities  and,  thus  improves
comparability  between  enterprises  engaged  in  similar  activities when those
activities  are  conducted  through variable interest entities. The Company does
not  hold  any  variable  interest  entities.

                                      -13-

<PAGE>
                          VALCOM, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)

RECLASSIFICATION
----------------

Certain  prior  period  amounts have been reclassified to conform to the current
period's  presentation.


NOTE  2  NET  INCOME  (LOSS)  PER  SHARE
----------------------------------------

The  Company's  net  loss per share was calculated using weighted average shares
outstanding of  19,018,382 and 19,170,824 the three and six months ended March
31, 2004 and 11,816,467 and 11,487,280 for  the  three  and  six months ended
March 31, 2003, respectively. Although  convertible preferred stock,
convertible debt, and warrants are common stock  equivalents, they are not
included in the calculation of diluted earnings per  share  as their effect
would be anti-dilutive or their conversion price was greater  than  the
average  market  price  of  the  Company's  common  stock.

NOTE  3  EQUITY  INVESTMENT
---------------------------

As of December 31, 2003, ValCom had a 45% interest in a broadcasting company
in Palm Springs, California. This interest was sold to Eye Span Entertainment
Network, Inc. (ES), a related party, in exchange for 750,000 shares of common
stock of ES on February 16, 2004. valued at $14,519. The Company distributed
shares of ES to its shareholders as dividend in their ratio of ownership as
of December 15, 2003.

NOTE  4  SEGMENT  INFORMATION
-----------------------------
                             Studio & Equip  Film & TV     Magazine
                             Rental          Production    Puvlication  Total
                             -------         ----------   ------------  -----

As of and for the six months
ended  March  31,

2004
----
Revenues                    $ 1,093,775     $  65,022        -       $1,158,797
Operating  (Loss)  Income    (4,293,893)    ( 124,319)       -       (4,418,212)
Total  Assets                14,231,467           -          -       14,231,476
Depreciation and Amortization   470,167           -          -          470,167
Interest Expense                681,377           -          -          681,377
Capital Expenditures          2,925,514           -          -        2,925,514

2003
----
Revenues                    $ 1,225,996     $     -     $ 76,573    $ 1,302,569
Operating  loss              (  957,165)     (144,926)  (107,543)   ( 1,209,634)
Total  Assets                12,362,562           -          -       12,362,562
Depreciation and Amortization   176,275           -          -          176,275

                                      -14-

<PAGE>
                          VALCOM, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)

NOTE  5  LITIGATION
-------------------

On  April  7, 2003, Valencia Entertainment International (VEI) a 100% subsidiary
of ValCom, Inc., Delaware filed on an emergency basis, a voluntary Chapter
11  bankruptcy  petition.  The  case  is pending in the United States Bankruptcy
Court, Central District of California, San Fernando Valley Division, as Case No.
SV  03-12998-GM.  As  of March 31, 2004, the Company was in compliance of all of
its duties under the Bankruptcy Code and all applicable guidelines of the Office
of  the  United  States  Trustee.

On January 15, 2004, the Court approved two additional cash collateral
stipulations, one each with Finance Unlimited and Laurus, authorizing the
VEI's continued use of cash collateral through March 31, 2004 (Second Interim
Stipulation). The Second Interim Stipulation generally grants Finance Unlimited
and Laurus relief from the automatic bankruptcy stay effective March 31, 2004,
and the right to hold foreclosures sales on their real and personal property
collateral as early as April 1, 2004.

On  April  28,  2004  the  court  approved  two  additional  cash  collateral
stipulations,  one  each  with  Finance  Unlimited  and  Laurus, authorizing the
Company's  continued  use  of  cash  collateral  through May 31, 2004. The court
approved  an  extension and granted the restructuring of notes/debt with Finance
Unlimited  and  Laurus  for  settlement  and  to  be discharged from bankruptcy.

In  May 2004, Laurus paid off Finance and was subrogated to Finance's $6,565,998
claim,  which  became included in the senior of Laurus' two claims.  Laurus then
sought  to  conduct  a  non-judicial  foreclosure  sale of the Property, and VEI
objected.  The  Bankruptcy  Court  issued  an  order on June 3, 2004, that while
Laurus  could  conduct  a  non-judicial foreclosure sale of the Property, Laurus
would  not  be entitled to any deficiency claim against either VEI or ValCom, or
any  other  assets  other  than  the  Property  itself (and the rents and leases
appurtenant  thereto).

On  June  10,  2004,  the  court  ordered the Property to be sold. At this sale,
Laurus  claimed  that its senior note had a balance of $7,407,873 and its junior
note  a  balance  of  $2,405,093. Virtually all of the disputed penalties, along
with  a  disproportionate  share  of  disputed  legal  fees  and  expenses, were
incorporated  into  the junior balance, while the senior included the $6,565,998
million  subrogated  from  the Finance claim. The sale was conducted through the
junior  note,  and  the  Property was sold for $2.9 million to a third party. An
affiliate  of  this  third  party  then  purchased the senior note directly from
Laurus,  without  a  second  sale.

As a result of the Bankruptcy Court's order and the subsequent trustee's sale of
the  Property,  neither VEI nor ValCom are subject to any further liabilities on
account  of  the notes and deeds of trust previously held by Finance and Laurus.
Even  though  the  senior  note  still  technically exists, it has been rendered
non-recourse by the Bankruptcy Court's order, and could only be enforced against
the  Property itself (which no longer belongs to VEI). Any liability owed to the
third  party,  which  purchased the Property with regard to the rents, collected
for  June  2004  has  been  resolved  by  settlement  with  that  party.

The Company had recorded liability of $ 8,407,310 for the Laurus loan
(including Finance Unlimited loan) as of March 31, 2004 but the bankruptcy
court valued the liability at $ 9,812,966 for the loans due to Laurus
(including subrogation from Finance Unlimited loan). The Company recorded
difference of $ 1,405,656 as the litigation settlement expense and reflected
it on the income statement for the period ending March 31, 2004.

NOTE 6  IMPAIRMENT OF PROPERTY AND EQUIPMENT

The property and equipment was recorded in the books at net value of
$11,251,216 (net of depreciation of $ 1,324,266). On June 10, 2004, the
property was foreclosed for $ 9,812,966 and the proceeds were used to pay off
the notes from Laurus. The Company has adjusted the value of the property to
its subsequent disposal value. The Company recorded difference between the
liabilities settled from foreclosure of the property and the net book value,
as an impairment of the property and equipment and recorded imapirement costs
of $ 1,438,250  during the period ending March 31, 2004.

 The impaired property and equipment comprised of the following:

   Land                                $     7,392,292
   Building                                  5,183,190
   Accumulated depreciation                 (1,324,266)
                                            11,251,216
   Exchange for payment of liability        (9,812,966)
   Impairment loss                     $    (1,438,250)

NOTE 7 RELATED PARTY TRANSACTIONS

On February 16, 2004, the Company sold its 45% interest in ValCom Broadcasting,
consisting of a joint venture agreement with New Global Communications, Inc.
The joint venture operates a newly developed low power television broadcast
station, K08MX-LP, in Palm Springs, California.  The February 16, 2004 Asset
Purchase Agreement with Eye Span Entertainment Network, Inc. also included
the sale by the Company of 143 titles from the ValCom, Inc. film library,
along with the copyrights, trademarks, equipment, legal options, supplies,
spare parts, inventory, and all other tangible personal property related to
bingo owned and used or useful in the operation of Latino Bingo, Satellite
Bingo and all other related items. It also included the sale of 10% ownership
interest in Las Vegas Studios located at 41 North Mojave Road, Las Vegas,
Nevada 89101. The shareholders of interest of Valcom Inc. as of December 15,
2003 received 750,000 shares of common stock of Eye Span Entertainment Network,
Inc, value at $14,519, for the sale of 45% interest in ValCom Broadcasting,
LLC, 143 film and television titles, all of the rights, title and interest
in Latino Bingo and Satellite Bingo, as well as the 10% interest in Las Vegas
Studios. . . The Company distributed shares of ES to its shareholders as
dividend in their ratio of ownership as of December 15, 2003.

NOTE  8  STOCKHOLDERS'  EQUITY
------------------------------
(A)  CONVERTIBLE  PREFERRED  STOCK
----------------------------------
On  September  30,  2002,  the Company had three series of convertible Preferred
Stock:  B, C, and D.  Series B Preferred Stock has no voting rights, is entitled
to  receive  cumulative  dividends  in  preference to any dividend on the common
stock  at  a  rate  of 8% per share, per year. Series B Preferred Stock is to be
issued  if  and when declared by the Board of Directors, and can be converted at
any time into common stock on a 1 for 5 basis.  In the event of any liquidation,
the  holders  of  shares  of Series B Preferred Stock then outstanding, shall be
entitled  to  receive  an  amount equal to the purchase price per share, plus an
amount  equal  to  declared but unpaid dividends thereon, if any, to the date of
payment.  Series  C Preferred Stock has no voting rights, is entitled to receive
cumulative dividends in preference to any dividend on the common stock at a rate
of  8%  per  share,  per year, to be issued if and when declared by the Board of
Directors and can be converted at any time into common stock on a 1 for 1 basis.
In  the  event  of  any liquidation, the holders of shares of Series C Preferred
Stock  then  outstanding,  shall  be  entitled to receive an amount equal to the
purchase  price per share, plus an amount equal to declared but unpaid dividends
thereon, if any, to the date of payment.  Series D Preferred Stock has no voting
rights, no dividends and can be converted at any time to common stock on a 1 for
1  basis.  In  the  event  of any liquidation, the holders of shares of Series D
Preferred  Stock  then outstanding, shall be entitled to receive an amount equal
to  the  purchase  price  per  share.

With  respect to rights on liquidation, Series B, C, and D Preferred Stock shall
rank senior to the common stock, but Series C Preferred Stock shall be senior to
both  Series  B and D Preferred Stock.  Series D Preferred Stock shall be junior
to  both Series B and C Preferred Stock.  No dividends have been declared by the
Board  of Directors for any of the Series of convertible Preferred Stock for the
fiscal  year  ended  September  30,  2003.

On  June  6,  2002,  the  Company  received  $930,000,  net  for the issuance of
1,250,000  shares  of  Series  D  Convertible  Preferred  Stock to an accredited
investor.  In  connection with the transaction, the Company also issued warrants
to the preferred stockholder to purchase an aggregate of 1,300,000 shares of the
Company's  common stock at an exercise price of $.80 per share, expiring on June
18,  2007.

The  Company  allocated the net proceeds received from the sale of the preferred
stock  to  the warrants using the Black-Scholes pricing model. The allocation of
the  net  proceeds  to  the  warrants  amounted  to  $466,908 and is included in
additional  paid-in  capital  in the accompanying condensed consolidated balance
sheet  at  September 30, 2002. Also, in connection with the sale of the Series D
Convertible  Preferred  Stock, the Company incurred a 7% placement agent fee and
issued the placement agent's 125,000 "VACM Units". Each unit is comprised of one
share  of common stock and a warrant to purchase one share of common stock at an
exercise  price  of  $0.80 per share. The Company recorded the $70,000 placement
agent  fee  as a reduction of the proceeds received, thereby reducing additional
paid-in  capital by $70,000 at September 30, 2002. Each VACM Unit is exercisable
at  $0.80 per unit and the unit and the underlying warrant expire June 18, 2007.
The Company valued the VACM Unit by apportioning value to the underlying warrant
and  common  stock  using  the Black-Scholes pricing model, and by measuring the
intrinsic  value  of  the  common  stock.  The  value  of the 125,000 VACM Units
amounted  to  $60,745  and  was  recorded  as  an increase in additional paid-in
capital  at  September  30,  2002.

                                      -15-

<PAGE>
                          VALCOM, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)

(B)  COMMON  STOCK
------------------

During the six months dnded March 31, 2004, the Company converted the Series
D Preferred Stock to common stock by issance of 2,800,000 shares of common
stock.

During the six months ended March 31, 2004, the Company issued 208,333 shares of
common  stock in lieu of debt retirement.  The value of the debt retired totaled
$25,000.

During the six months ended March 31, 2004, the Company issued 500,000 shares of
common stock in lieu of prepaid development costs.  The value of the development
costs  totaled $215,000. The Company amortized $107,500 of the expenses during
the six months period ending March 31, 2004.

During the six months ended March 31, 2004, the Company issued 650,000 shares of
common  stock  in  lieu  of prepaid acquisition and development costs of the Las
Vegas  Studios.  The  value  of  the  development  costs  totaled  approximately
$266,510. The Company amortized $66,625 of expenses for the period ending March
31, 2004.

During  the six months ended March 31, 2004, the Company issued 1,200,000 shares
of  common  stock  in lieu of compensation for consultant services performed and
compensation.  The  value  of  the  services  performed  totaled $594,000.

During  the six months ended March 31, 2004, the Company issued 30,000 shares of
common  stock  to  a director in lieu of an interest payment of $3000.

During the six months ended March 31, 2004, the Company issued 600,000 shares
of common stock in exchange for 600,000 shares of series C preferred convertible
on a one on one basis and retired 110,000 to treasury as part of settlement
agreement.

During the six months ended March 31, 2004, the Company issued 300,000 shares of
common  stock  to  a director in lieu of retirement of a loan.

During the six months ended March 31, 2004, the Company issued 928,000 shares of
common stock for options exercised  amounting to $ 232,000

During  the  six months ended March 31, 2004, the Company issued an aggregate of
315,750  shares of common stock in lieu of compensation, salaries and bonuses to
employees.  Total  value  of  the  compensation,  salaries  and  bonuses  was
$121,458.

During the six months ended March 31, 2004, the Company issued 752,000 shares
of common stock for cash amounting to $ 467,500.



                                      -16-

<PAGE>

During  the fiscal year ended September 30, 2003, the Company issued warrants to
purchase  2,083,334  shares  of  the  Company's  common  stock  to a director in
connection  with  services  provided  and  to  be  provided to the company.  The
weighted average exercise price for the warrants issued was $0.12 and all of the
warrants  begin to expire in September 2005.  The director has exercised 791,666
warrants  up  to  March  31,  2004.  This  issuance  of  shares  was exempt from
registration pursuant to Section 4(2) of the Securities Act of 1933, as amended.

During  the fiscal year ended September 30, 2002, the Company issued warrants to
purchase  2,075,000  shares of the Company's common stock to certain individuals
and  companies  in connection with the issuance of Series D Preferred Stock (see
Note  13(A))  and consulting agreements. The weighted average exercise price for
the warrants issued was $0.75, and all of the warrants begin to expire in fiscal
year  2007.  There  were  no  warrants  outstanding  prior  to fiscal year 2002.
Additionally,  the Company recorded consulting expense of $271,651 in connection
with warrants issued to consultants.  These warrants were valued using the Black
Scholes  pricing  model.  The  Company  also  recorded  $324,724  of  deferred
compensation  in  connection  with the consulting agreements in the accompanying
consolidated  balance  sheet  at  September  30,  2002.

In  connection  with  the  acquisition  of  PTL Productions, Inc. (dba Brentwood
Magazine),  the Company was to issue 400,000 shares of Series C preferred stock,
convertible  1  for  1 into common shares.  The Value of the preferred stock was
$252,000  or  $.63 per share based on the value of the Company's common stock on
the  date of acquisition.  On December 6, 2002 the Company issued 380,000 shares
of  Series  C  Preferred Stock valued at $239,400.  The par value of the 380,000
shares  of  Series C Preferred Stock ($380) is included in preferred stock while
the  remaining value ($239,020) is included in additional paid-in-capital.   The
value  of  the remaining 20,000 shares of $12,600 still to be issued is included
in  preferred stock payable in the accompanying balance sheet.  In January 2003,
the  Company  entered into a Memorandum of Understanding to cancel the Agreement
and  Plan  of Reorganization dated August 2, 2002, pursuant to which the Company
acquired  PTL  Productions,  Inc.  (dba  Brentwood  Magazine)  and  sell  PTL
Productions,  Inc. back to the seller.  In connection with the sale, the Company
will receive back 200,000 shares of its Series C Preferred Stock and $300,000 of
trade  credit  (See  Note  8).

NOTE  9  SUBSEQUENT  EVENTS
---------------------------

Sale  of  Building
The Company filed  a voluntary chapter 11-bankruptcy petition on April 7, 2003.
By May 2004,  the  Property was subject to three (3) secured claims.  These
were a note and  first-priority  deed of trust held by Finance Unlimited, LLC
("Finance") in the  amount  of  $6,565,998  and  two  notes,  secured  by
second-priority  and third-priority deeds of trust, both held by Laurus Master
Fund, Ltd. ("Laurus"). Laurus  claimed that it was owed a total of $2,978,876
plus additional penalties and  additional  legal  fees  on  the  two  notes
but the Company disputed many of the penalties  claims by Laurus.  The Finance
note was solely the obligation of the Company.

In  May 2004, Laurus paid off Finance and was subrogated to Finance's $6,565,998
claim,  which  became included in the senior of Laurus' two claims.  Laurus then
sought  to  conduct  a  non-judicial  foreclosure  sale of the Property, and VEI
objected.  The  Bankruptcy  Court  issued  an  order on June 3, 2004, that while
Laurus  could  conduct  a  non-judicial foreclosure sale of the Property, Laurus
would  not  be entitled to any deficiency claim against either VEI or ValCom, or
any  other  assets  other  than  the  Property  itself (and the rents and leases
appurtenant  thereto).

On  June  10,  2004,  the  court  ordered the Property to be sold. At this sale,
Laurus  claimed  that its senior note had a balance of $7,407,873 and its junior
note  a  balance  of  $2,405,093. Virtually all of the disputed penalties, along
with  a  disproportionate  share  of  disputed  legal  fees  and  expenses, were
incorporated  into  the junior balance, while the senior included the $6,565,998
million  subrogated  from  the Finance claim. The sale was conducted through the
junior  note,  and  the  Property was sold for $2.9 million to a third party. An
affiliate  of  this  third  party  then  purchased the senior note directly from
Laurus,  without  a  second  sale.

As a result of the Bankruptcy Court's order and the subsequent trustee's sale of
the  Property,  neither VEI nor ValCom are subject to any further liabilities on
account  of  the notes and deeds of trust previously held by Finance and Laurus.
Even  though  the  senior  note  still  technically exists, it has been rendered
non-recourse by the Bankruptcy Court's order, and could only be enforced against
the  Property itself (which no longer belongs to VEI). Any liability owed to the
third  party,  which  purchased the Property with regard to the rents, collected
for  June  2004  has  been  resolved  by  settlement  with  that  party.

Based upon court order, the Company has adjusted the value of its property at
March 31, 2004 and recorded an impairement of its value (note 6).

BANKRUPTCY  DISMISSAL

VEI  filed  a  voluntary  chapter  11  bankruptcy  petition on April 7, 2003 and
obtained  the  status  of  Debtor in Possession. After successfully settling the
debts  owed  to  secured  creditors  through sale of property as per court order
dated  June  3,2004  VEI  applied to the United States Bankruptcy Court, Central
District  of  California,  San  Fernando Valley Division for a Motion to dismiss
Chapter  11  Bankruptcy  case ("the Motion").The Court on August 3, 2004, having
considered  the  Motion  and  pleadings  filed  in support thereof, having heard
argument  of  counsel,  finding  that  notice  was  proper,  and  for good cause
appearing  therefore,  ordered  (1)  The  Motion granted (2) Debtor's Chapter 11
bankruptcy  case  dismissed.

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

INTRODUCTION

 PLAN  OF  OPERATION

As of March 31, 2004, ValCom, Inc. operations were comprised of three divisions:
(1) Studio and Equipment Rental, and Personnel Rental, (2) Broadcast Television
and  (3)  Film  and  Television  Production.

RENTAL
-------

The  Company  and  its  subsidiary,  Valencia  Entertainment International, LLC,
operates  eight  sound  stages  in Valencia, California.  Valencia Entertainment
International,  LLC owns six improved acres on which six of the sound stages are
located.  The  Company  leases the other two sound stages.  Beginning June 2003,
the  Company  and  its  subsidiary  has  a newly signed one-year lease with five
one-year  options  for  all  eight  sound stages, which will generate $2,100,000
annually  with cost-of-living increases.  The Company has acquired seven and one
half  acres  of  property in Nevada with 162,000 square feet of buildings, which
are  being  renovated  into  seven  sound  stages  for  rental.  The  Company's
subsidiary,  Half  Day  Video,  Inc.,  supplies  personnel,  cameras,  and other
production  equipment to various production companies on a short-term basis.

TELEVISION,  FILM,  &  ANIMATION  PRODUCTION
--------------------------------------------

The  Company,  in  addition  to  producing its own television and motion picture
programming,  has  an exclusive facilities agreement in place for productions in
Los  Angeles  County  for  a  three-year  term  with  Woody  Fraser/Woody Fraser
Productions  (See  Note  5).

                                      -17-

<PAGE>
                          VALCOM, INC. AND SUBSIDIARIES

CHANNEL  8  IN  PALM  SPRINGS,  CALIFORNIA
------------------------------------------
In  connection  with its joint venture with New Global Communications, Inc., the
Company  owns  a  45%  equity  interest  in ValCom Broadcasting, LLC, a New York
limited  liability  company,  which  operates  KVPS  (Channel 8), an independent
television  broadcaster  in  the  Palm  Springs,  California  market

RESULTS  OF  OPERATIONS

THREE  MONTHS  ENDED  MARCH  31,  2004  VS.  MARCH  31,  2003
-------------------------------------------------------------

Revenues for the three months March 31, 2004 decreased by $11,058 or 2.09% from
$537,640  for  the  three  months  ended March 31, 2003 to $526,582 for the same
period in 2004.  The decrease in revenue was principally due to increased studio
revenues  and  decreased  production  revenues associated with the joint venture
with  Woody  Fraser  Productions.

Production  costs for the three months ended March 31, 2004 decreased by $58,932
or  91.09%  from $64,693 for the three months ended March 31, 2003 to $5,761 for
the  same  period in 2004.  The decrease in production costs was principally due
to  decreased  production  associated with Woody Fraser Productions as described
above.

Impairment  of property increased by $1,438,250 for the three months ended March
31,2004  principally due to the property being sold subsequently to pay off
Finance Unlimited and  Laurus  Notes.

The Litigation costs increased by $1,405,656 for the three months ended
March  31,  2004  compared  to  $0  for  the  three  months ended March 31, 2003
primarily due to additional interest, penalties, acceleration payment and lawyer
fees  paid  for  the  settlement  of  Laurus  Notes.

Depreciation  and amortization expense for the three months ended March 31, 2004
increased  by $293,792 or 432% from $88,535 for the three months ended March 31,
2003  to  $382,327 for  the  same  period  in 2004.  General and administrative
expenses  for  the  three  months  ended March 31, 2004 increased by $39,259 or
3.8%  from  $982,107 for the three months ended March 31, 2003 to $1,021,366 for
the  same  period  in  2004.  The  increase  was  due  principally  to decreased
personnel  costs,  insurance,  printing,  and  bad  debt  expenses.

Interest  expense for the three months ended March 31, 2004 increased by $17,210
or 4.16% from $396,575 for the three months ended March 31, 2003 to $413,785 for
the  same  period  in 2004.  The increase was due principally to the increase in
interest  rates  associated  with  the  company's  mortgage  loans.


Due  to  the  factors  described  above,  the  Company's  net  loss  increased
by$3,595,146 from $926,679  for  the  three  months  ended  March  31, 2003 to
$4,521,825 for  the  same  period  in  2004.

SIX  MONTHS  ENDED  MARCH  31,  2004  VS.  MARCH  31,  2003
-----------------------------------------------------------

Revenues for the six months ended March 31, 2004 decreased by $143,772 or 12.41%
from  $1,352,569  for  the six months ended March 31, 2003 to $1,158,797 for the
same  period  in 2004.  The decrease in revenue was principally due to increased
rental  income  from  sound  stages leased to Paramount and decreased production
revenues  associated  with  the  joint venture with Woody Fraser Productions and
decreased  rental  revenues  from  other  income.

Production  costs  for the six months ended March 31, 2004 decreased by $239,013
or 93.5%from $255,716 for the six months ended March 31, 2003 to $16,703 for the
same  period  in  2004.  The decrease in production costs was principally due to
decreased  production  associated  with  Woody  Fraser  Productions as described
above.

Impairment  of property and equipment increased by $1,438,250 for the six months
ended  March  31,  2004 compared to $0 for the three months ended March 31, 2003
primarily due to subsequent sale of property of VEI to pay off Finance
Unlimited and Laurus Notes.

                                      -18-

<PAGE>

                          VALCOM, INC. AND SUBSIDIARIES


The Litigation costs increased by $1,405,656 for the six months
ended March 31, 2004 compared to $0 for the six months ended March 31, 2003
primarily due to additional interest, penalties, and acceleration payment and
lawyer's fee paid for the settlement of Laurus Notes.

Depreciation and  amortization  expense for the six months ended March 31, 2004
increased  by $293,892 or 159% from $176,275 or for the six months ended March
31,2003 to $470,396 for the same period in 2004, mainly due to write off of
certain balance sheet items.

General  and  administrative  expenses  for  the six months ended March 31, 2004
decreased  by $363,093 or 21% from $2,065,744 for the six months ended March 31,
2003  to  $1,702,150  for  the  same  period  in  2004.  The decrease was due to
decreased  personnel  costs,  legal  and  accounting  fees, outside services and
consulting  fees  and  bad  debt  expense.

Interest  expense  for the six months ended March 31, 2004 increased by $109,964
or 19% from $571,413 for the six months ended March 31, 2003 to $681,377 for the
same  period  ended  March  31,  2004.

Other  income  for  the six months ended March 31, 2004 decreased by $24,091 or
45% from $77,642 for the six months ended March 31, 2003 to $53,551 primarily
due  to less equipment rental activity.  Due to the factors described above, the
Company  incurred  a  net  loss of $5,046,038 for the six months ended March 31,
2004  compared  to  net  loss  of  $1,703,405  for  the  same  period  in  2003.


FUTURE  OUTLOOK

The Company has entered into a joint venture agreement with O. Atlas Enterprises
to  produce an animation movie and an animation TV series called "New Zoo Revue"
based  on  an  American  Classic  of the same name, which was highly successful.
BCI/Navarre  has  purchased  an  exclusive  agreement to distribute 195 existing
shows  of  New Zoo Revue for the retail market.  We anticipate the New Zoo Revue
to be available to consumers through 4,000 Wal-Mart retail outlets by August 10,
2004.  The  Company  has  already  incurred  start-up  costs,  which  have  been
reflected  in  the financial statements for the six months ended March 31, 2004.

The  Company  has purchased additional studio facilities comprising 7.5 acres of
land  and  162,000  sq.  ft.  of buildings in Las Vegas as part of its expansion
plans.  The  Company  is  undergoing a three-phase renovation, which will ensure
additional  rental  revenues  to  the Company with revenue opportunities for the
Company's  other  related  businesses  to  begin  almost  immediately.

LIQUIDITY  AND  CAPITAL  RESOURCES

The  Company's  condensed  consolidated financial statements have been prepared,
assuming  that  the Company will continue as a going concern.  The Company has a
net loss of $5,046,038 and a negative cash flow from operations of $876,688 for
the six months ended March 31, 2004, a working capital deficiency of $11,638,059
and  an  accumulated deficit of $15,602,388 at March 31, 2004.  These conditions
raise  substantial  doubt  about  the  Company's  ability to continue as a going
concern.

Cash totaled $229,723 on March 31, 2004 compared to $39,670 as at March 31,2003.
During  the  six  months  ended  March  31,  2004,  net  cash  used by operating
activities  totaled $876,688 compared to net cash used by operating activities
totaled  $503,240  for  the  comparable six-month period in 2003.  A significant
portion  of  operating  activities included payments for interest and production
development  costs. Net cash provided by financing activities for the six months
ended  March  31, 2004 totaled $1,127,898 compared to $98,097 for the comparable
six-month  period in 2003.  Net cash used in investing activities during the
six months ended March 31, 2004 totaled $8,247,380 compared to net cash provided
$233,169 during  the  comparable prior year period due to proceeds from sale of
fixed  assets.

The above cash flow activities yielded a net cash increase of $18,041 during the
six  months  ended  March 31, 2004 compared to a decrease of $343,374 during the
comparable  prior  year  period.

Net  working  capital  (current  assets less current liabilities) was a negative
$11,538 as of March 31, 2004. The Company will need to raise funds through
various  financing to maintain its operations until such time as cash generated
by  operations  is  sufficient to  meet its operating and capital requirements.
There can be no assurance that the Company will be able to raise such capital on
terms  acceptable  to  the  Company,  if  at  all.


ITEM  3.  DISCLOSURE  CONTROLS  AND  PROCEDURES
-----------------------------------------------

Evaluation  of  Disclosure  Controls  and  Procedures
-----------------------------------------------------

Disclosure  controls  and  procedures  are  designed  to ensure that information
required  to  be  disclosed  in  the  Company's  periodic reports filed with the
Securities  and Exchange Commission under the Securities Exchange Act of 1934 is
recorded,  processed, summarized and reported, within the time periods specified
in  the  rules  and forms of the Securities and Exchange Commission.  Disclosure
controls  and  procedures  include,  without limitation, controls and procedures
designed  to  ensure  that  information required to be disclosed in the periodic
reports  filed  under  the  Securities  Exchange  Act of 1934 is accumulated and
communicated  to management, including the Chief Executive Officer and Principal
Financial  Officer, as appropriate, to allow timely decisions regarding required
disclosure.

Within  the  90  days  prior  to  the  filing  date  of this Report, the Company
conducted  an evaluation of the effectiveness of the design and operation of its
disclosure  controls  and  procedures  pursuant  to Securities Exchange Act Rule
13a-14.  This  evaluation  was  conducted  under  the  supervision  and with the
participation  of  the Company's Chief Executive Officer and Principal Financial
Officer.

     Effective  Disclosure  Controls
     -------------------------------

Based  upon  that  evaluation, the Company's officers concluded that many of the
Company's  disclosure  controls  and  procedures  are

                                      -19-

<PAGE>
                          VALCOM, INC. AND SUBSIDIARIES


effective  in  gathering, analyzing and disclosing information needed to satisfy
the  Company's disclosure obligations under the Securities Exchange Act of 1934.
For example, the Company's internal controls, particularly the areas of payroll,
control  of  cash  and  accounts payable, are effective.  In addition, the Audit
Committee  meets  with  the  principal  accounting officer on a regular basis to
review  and evaluate the Company's financial position.  The Audit Committee also
reports  to  the Board of Directors on the accounting and finance functions on a
regular  basis.

     Weaknesses  in  Disclosure  Controls
     ------------------------------------

The  Company's  officers  also  identified  several  weaknesses in the Company's
disclosure  controls.  Such  weaknesses, and the steps the Company plans to take
to  remedy  the  weaknesses,  are  discussed  below.

1. The Company's records of stock and equity related transactions were not
updated on a timely basis and do not reflect the current ownership of the
Company as accurately as they might. Remedy: The Company intends to engage a
stock transfer agent to handle issuances and conversions of all series of its
preferred stock. In addition, the Company will maintain more accurate records of
all equity transactions during the year.

The Board of Directors will ensure that it authorizes all stock, warrants and
options granted in accordance with applicable agreements and/or compensation
plans to avoid the possibility of unauthorized issuances of stock, warrants and
options.

2. The Company recorded a significant number of audit adjustments during the
fourth quarter, which were required to properly state the account balances at
September 30, 2002. Remedy: The Company will implement comprehensive closing
procedures, including an analysis of all balance sheet accounts and significant
income statement accounts.

3. The minutes of the Board of Directors' and stockholders' meetings were not
always complete. Remedy: The Company will implement procedures to be more
comprehensive in the preparation of its minutes to include all important matters
that affect the Company's operations. The Company will take appropriate steps to
ensure that all minutes are properly approved and signed by the applicable
parties.

4. The Company drafted several agreements without consulting its legal counsel.
Therefore, some of the agreements had terms and provisions that either changed
the purpose of the agreement or undermined the purpose or intent of management.
Remedy: The Company will consult its legal counsel as to the legality of future
agreements and consult its auditors regarding the proper accounting treatment
of such agreements in order to preserve the purpose of the agreements and the
intent of management.

     Changes  in  Internal  Controls
     -------------------------------

There were no significant changes in the Company's internal controls or in other
factors  that  could  significantly  affect those controls since the most recent
evaluation  of  such  controls.  The  Company  intends  to  make  extensive
improvements,  as  outlined  above,  to  its  disclosure  controls.

PART  II--OTHER  INFORMATION

ITEM  1.  LEGAL  PROCEEDINGS
----------------------------

The  Company  is involved from time to time in legal proceedings incident to the
normal course of business.  Management believes that the ultimate outcome of any
pending or threatened litigation would not have a material adverse effect on the
Company's  consolidated financial position, results of operations or cash flows.

ITEM  2.  CHANGES  IN  SECURITIES
---------------------------------

(B)  COMMON  STOCK
------------------
During the six months ended March 31, 2004, the Company convertd the Series D
Preferred Stock to common staock by issuance of 2,800,000 shares of
common stock.

During the six months ended March 31, 2004, ths Company issued 208,333 shares
of common stock in lieu of debt retirement. The value of the debt retired total
$25,000.

ITEM  3.  DEFAULTS  UPON  SENIOR  SECURITIES
--------------------------------------------

Not  applicable

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

Not  applicable

ITEM  5.  OTHER  INFORMATION
----------------------------

1.     Donald  Magier  resigned  as  secretary,  controller  and  director.
2.     Tracey  Eland  has  been  appointed  to  service  as  Secretary  of  the
       Corporation.

ITEM  6.  EXHIBITS  AND  REPORTS  ON  FORM  8-K
-----------------------------------------------

(A)  EXHIBITS:

Exhibit  Number     Description
---------------     -----------

99.1   Certification  of  the Chief Executive Officer of ValCom, Inc.  Pursuant
to  18  U.S.C. Section  1350,  As  Adopted  Pursuant  to  Section  906  of  the
Sarbanes-Oxley  Act  of  2002.

       Certification of the Chief Financial Officer of ValCom, Inc. Pursuant to
18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley
Act  of  2002.


<PAGE>
                         VALCOM, INC. AND SUBSIDIARIES

99.2  Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

(B)  REPORTS  ON  FORM  8-K
          March 29, 2004 Edgar: Resignation of Donald Magier as officer and
     director.



                                   SIGNATURES
                                   ----------

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

                                  VALCOM, INC.


Date:  August 20,  2004             By:  /s/Vince  Vellardita
                                  -------------------------------------
                                   Vince  Vellardita  Chairman  of  the
                                   Board  and  Chief  Executive  Officer
                                   (Principal  executive  officer)




In  accordance  with  the  Securities  Exchange Act, this report has been signed
below by the following persons on behalf of the registrant and in the capacities
and  on  the  date  indicated.

 Signature                       Title                           Date
 ---------                       -----                           ----


BY:  /s/  Vince  Vellardita      CEO/President                   May 19, 2004
          ------------------     Chairman of the Board          --------------
          Vince  Vellardita


BY:  /s/  Tracey  Eland          Secretary                       May 19, 2004
          -------------         (Principal Accounting Officer)  -------------
          Tracey  Eland



<PAGE>
EXHIBIT  99.1

          CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED
          ------------------------------------------------------------
            PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I,  Vince  Vellardita,  the  Chief  Executive  Officer  of  ValCom,  Inc.  (the
"Company"),  certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002,
18  U.S.C.  Section  1350,  that  to  the  best  of  my  knowledge:

(1)     the  Quarterly  Report  on  Form  10-QSB  of  the Company for the fiscal
quarter  ended  March  31,  2004  (the  "Report")  fully  complies  with  the
requirements  of Section 13 (a) or 15 (d) of the Securities Exchange Act of 1934
(15  U.S.C.  78m  or  78o(d));  and

(2)     the information contained in the Report fairly presents, in all material
respects,  the  financial  condition  and  results of operations of the Company.



Dated:  August 13,  2004
        --------------
                                   /s/  Vince  Vellardita
                                   ----------------------
                                   Name:  Vince  Vellardita
                                   Title:  Chief  Executive  Officer



          CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED
          ------------------------------------------------------------
            PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I,  Tracey  Eland, the Secretary  (principal accounting officer) of ValCom, Inc.
(the  "Company"),  certify, pursuant to Section 906 of the Sarbanes-Oxley Act of
2002,  18  U.S.C.  Section  1350,  that  to  the  best  of  my  knowledge:

(1)     the  Quarterly  Report  on  Form  10-QSB  of  the Company for the fiscal
quarter  ended  March  31,  2004  (the  "Report")  fully  complies  with  the
requirements  of Section 13 (a) or 15 (d) of the Securities Exchange Act of 1934
(15  U.S.C.  78m  or  78o(d));  and

(2)     the information contained in the Report fairly presents, in all material
respects,  the  financial  condition  and  results of operations of the Company.


Dated:  August 13,  2004
        --------------



                              /s/Tracey  Eland
                              ----------------
                              Name:  Tracey  Eland
                              Title:  Controller (Principal Accounting Officer)



<PAGE>

EXHIBIT  99.2
                           CERTIFICATIONS PURSUANT TO
                         RULES 13A-14 AND 15D-14 OF THE
                  SECURITIES EXCHANGE ACT OF 1934, AS AMENDED,
                             AS ADOPTED PURSUANT TO
                  SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

     In  connection  with  the  Quarterly  Report  of  ValCom,  Inc., a Delaware
corporation  (the  "Company"),  on  Form  10-QSB for the period ending March 31,
2004,  as  filed  with the Securities and Exchange Commission on the date hereof
(the  "Report"), I, Vince Vellardita, the Company's Chief Executive Officer (the
"Officer"),  certify,  pursuant  to  Rule  13a-14  or  15d-14  of the Securities
Exchange  Act  of  1934,  as  amended,  that:

(1) The Officer has reviewed the Report.

(2) Based on the Officer's knowledge, the Report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by the Report.

(3) Based on the Officer's knowledge, the financial statements and other
financial information included in the Report fairly present in all material
respects the Company's financial condition and results of operations as of, and
for, the periods presented in the Report.

(4) The Officer and the other certifying officer:

(a)  Are  responsible  for establishing and maintaining "disclosure controls and
     procedures,"  as  that  term  is  defined  by  the  Securities and Exchange
     Commission,  for  the  Company.

(b)  Have  designed  such  disclosure  controls  and  procedures  to ensure that
     material  information  relating  to  the  Company  is  made  known to them,
     particularly  during  the  period  in  which  the  periodic Report is being
     prepared.

(c)  Have  evaluated  the effectiveness of the Company's disclosure controls and
     procedures  within  90  days  prior  to  the  filing  date  of  the Report.

(d)  Have  presented  in the Report their conclusions about the effectiveness of
     the  disclosure controls and procedures based on the required evaluation as
     of  that  date.

(5) The Officer and the other certifying officer have disclosed to the Company's
auditors and audit committee of the board of directors (or persons fulfilling
the equivalent function):

(a)  All  significant  deficiencies  in  the  design  or  operation  of internal
     controls,  as  that  term  is  defined  by  the  Securities  and  Exchange
     Commission,  which  could adversely affect the Company's ability to record,
     process,  and  summarize  and report financial data and have identified for
     the  Company's  auditors  any material weaknesses in internal controls; and

(b)  Any  fraud,  whether  or  not  material,  that involves management or other
     employees  who  have a significant role in the Company's internal controls.

(6)  The  Officer  and the other certifying officer have indicated in the Report
whether  or  not there were significant changes in internal controls or in other
factors that could significantly affect internal controls subsequent to the date
of their evaluation, including any corrective actions with regard to significant
deficiencies  and  material  weaknesses.

Dated:  August 13,  2004
        --------------


                         By:     /s/  Vince  Vellardita
                                 ----------------------
                                 Vince  Vellardita
                                 Chief  Executive  Officer



<PAGE>

     In  connection  with  of  the  Quarterly Report of ValCom, Inc., a Delaware
corporation  (the  "Company"),  on  Form 10-QSB for the period ending March  31,
2004,  as  filed  with the Securities and Exchange Commission on the date hereof
(the  "Report"),  I,  Tracey  Eland  ,  the  Company's  Secretary  and principal
accounting  officer  (the "Officer"), certify, pursuant to Rule 13a-14 or 15d-14
of  the  Securities  Exchange  Act  of  1934,  as  amended,  that:

(1) The Officer has reviewed the Report.

(2) Based on the Officer's knowledge, the Report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by the Report.

(3) Based on the Officer's knowledge, the financial statements and other
financial information included in the Report fairly present in all material
respects the Company's financial condition and results of operations as of, and
for, the periods presented in the Report.

(4) The Officer and the other certifying officer:

(a)  Are  responsible  for establishing and maintaining "disclosure controls and
     procedures,"  as  that  term  is  defined  by  the  Securities and Exchange
     Commission,  for  the  Company.

(b)  Have  designed  such  disclosure  controls  and  procedures  to ensure that
     material  information  relating  to  the  Company  is  made  known to them,
     particularly  during  the  period  in  which  the  periodic Report is being
     prepared.

(c)  Have  evaluated  the effectiveness of the Company's disclosure controls and
     procedures  within  90  days  prior  to  the  filing  date  of  the Report.

(d)  Have  presented  in the Report their conclusions about the effectiveness of
     the  disclosure controls and procedures based on the required evaluation as
     of  that  date.

(5) The Officer and the other certifying officer have disclosed to the Company's
auditors and audit committee of the board of directors (or persons fulfilling
the equivalent function):

(a)  All  significant  deficiencies  in  the  design  or  operation  of internal
     controls,  as  that  term  is  defined  by  the  Securities  and  Exchange
     Commission,  which  could adversely affect the Company's ability to record,
     process,  and  summarize  and report financial data and have identified for
     the  Company's  auditors  any material weaknesses in internal controls; and

(b)  Any  fraud,  whether  or  not  material,  that involves management or other
     employees  who  have a significant role in the Company's internal controls.

(6) The Officer and the other certifying officer have indicated in the Report
whether or not there were significant changes in internal controls or in other
factors that could significantly affect internal controls subsequent to the date
of their evaluation, including any corrective actions with regard to significant
deficiencies and material weaknesses.

Dated:  August 13,  2004
       ---------------

                         By:     /s/  Tracey  Eland
                                 ------------------
                                 Tracey  Eland
                                 Secretary  and
                                 Principal  Accounting  Officer

                                      -25-