<PAGE>

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

                                  FORM 10-QSB

(Mark One)

     [x]   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
             EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 1999

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

          For the transition period from _______________ to _______________


Commission File Number 0-21635

                        Global Diamond Resources, Inc.
--------------------------------------------------------------------------------
       (Exact name of small business issuer as specified in its charter)

             Nevada                                              33-0213535
--------------------------------------            ------------------------------
  (State or other jurisdiction                                  (IRS Employer
of incorporation or organization)                            Identification No.)

          836 Prospect Street, Suite 2B, La Jolla, California  92037
--------------------------------------------------------------------------------
                   (Address of principal executive offices)

                                (619) 459-1928
                          ---------------------------
                          (Issuer's telephone number)


                                Not Applicable
--------------------------------------------------------------------------------
  (Former name, former address and former fiscal year, if changed since last
                                    report)

     Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act of 1934 during the past 12 months (or
for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days.

                       Yes _____          No  X
                                             ---

     As of November 12, 1999, the Company had 45,600,678 shares of its $.0005
par value common stock issued and outstanding.
<PAGE>

                        PART 1 - FINANCIAL INFORMATION


<TABLE>
<CAPTION>
ITEM 1. Financial Statements                                                                    PAGE
                                                                                                ----
<S>                                                                                             <C>
Condensed Consolidated Balance Sheet at September 30, 1999 (unaudited)
  and December 31, 1998.......................................................................     2
Unaudited Condensed Consolidated Statements of Operations for the three month
  and nine month periods ended September 30, 1999 and 1998....................................     3
Unaudited Condensed Consolidated Statements of Cash Flows for the
  nine month periods ended September 30, 1999 and 1998........................................     4
Notes to Condensed Consolidated Financial Statements..........................................     5
</TABLE>

                                      -1-
<PAGE>

                GLOBAL DIAMOND RESOURCES, INC. AND SUBSIDIARIES

                 Unaudited Condensed Consolidated Balance Sheet

                    September 30, 1999 and December 31, 1998


<TABLE>
<CAPTION>
                            Assets                                       1999                         1998
                                                                     ------------                 ------------
<S>                                                                  <C>                          <C>
Current assets:
  Cash and cash equivalents                                          $    615,549                    5,461,235
  Accounts receivable                                                     119,690                       50,478
  Inventory                                                               100,768                       57,016
                                                                     ------------                 ------------

                                                                          836,007                    5,568,729

Fixed assets, net                                                       6,495,507                    4,603,765
                                                                     ------------                 ------------

                                                                     $  7,331,514                   10,172,494
                                                                     ============                 ============

                          Liabilities

Current liabilities:
  Accounts payable, accrued liabilities and current
   portion of long-term debt                                         $    280,694                      959,734
                                                                     ------------                 ------------

Long-term debt, less current portion                                    3,000,000                    3,000,000
                                                                     ------------                 ------------


                      Stockholders' Equity

Stockholders' equity:
  Preferred stock, $0.001 par value, 10,000,000
    shares authorized, no shares issued                                        --                           --
  Common stock, $.0005 par value, 100,000,000
    shares authorized and 45,600,678 shares issued
    and outstanding                                                        22,800                       22,800
  Additional paid-in capital                                           13,457,899                   13,457,899
  Accumulated deficit                                                  (8,401,372)                  (6,432,958)
  Accumulated other comprehensive income
    Foreign currency translation adjustment                            (1,028,507)                    (834,981)
                                                                     ------------                 ------------

                                                                        4,050,820                    6,212,760
                                                                     ------------                 ------------

                                                                     $  7,331,514                   10,172,494
                                                                     ============                 ============
</TABLE>

See accompanying notes to condensed consolidated financial statements.

                                      -2-
<PAGE>

                GLOBAL DIAMOND RESOURCES, INC. AND SUBSIDIARIES

           Unaudited Condensed Consolidated Statements of Operations

For the three month periods and nine month periods ended September 30, 1999 and
                                     1998


<TABLE>
<CAPTION>
                                               Three month periods ended                 Nine month periods ended
                                          ------------------------------------      -----------------------------------
                                           September  30,       September 30,        September 30,       September 30,
                                                1999                 1998                1999                 1998
                                          ----------------     ---------------      ---------------     ---------------
<S>                                       <C>                  <C>                  <C>                 <C>
Diamond Sales                             $        437,594                  --              437,594                  --

Other Income:
  Interest Income                                   13,719               6,622               82,257              67,014
                                          ----------------     ---------------      ---------------     ---------------
                                                   451,313               6,622              519,851              67,014

Production Expenses                                254,904                  --              548,692                  --

Exploration Expenses                               190,753                  --              376,148                  --

Sales Expenses:
  Royalty                                           21,880                  --               21,880                  --

Expenses:
  Business development                                  --               5,000                4,772              12,113
  Consulting fees                                    3,109              13,000               16,330              43,000
  Depreciation                                       2,968               2,839                9,273               7,936
  Interest                                         115,022             112,500              341,540             283,417
  Legal and accounting                              36,008              46,240              149,962             149,665
  Office and miscellaneous                          55,769              63,342              187,880             209,048
  Salaries and benefits                            165,966             164,147              615,725             465,032
  Travel                                            67,354              78,042              214,990             197,829
                                          ----------------    ----------------      ---------------     ---------------
                                                   446,196             485,110            1,540,472           1,368,040
                                          ----------------    ----------------      ---------------     ---------------

Operating loss                                    (462,420)           (478,488)          (1,967,341)         (1,301,026)
Income tax expense                                      --                  --                1,073                 915
                                          ----------------    ----------------      ---------------     ---------------

  Loss before cumulative effect of
    accounting change                             (462,420)           (478,488)          (1,968,414)         (1,301,941)

  Cumulative effect on prior years
    of change in accounting for
    exploration and related costs                       --            (733,981)                  --            (733,891)
                                          ----------------    ----------------      ---------------     ---------------

Net loss                                          (462,420)         (1,212,469)          (1,968,414)         (2,035,832)

Other Comprehensive Income -
  Foreign currency translation
    adjustment                                       6,681              72,079             (193,526)           (863,269)
                                          ----------------    ----------------      ---------------     ---------------

Comprehensive loss                                (455,739)         (1,140,390)          (2,161,940)         (2,899,101)
                                          ================    ================      ===============     ===============

Basic and diluted net
  loss per share before cumulative
  effect of accounting change                        (0.01)              (0.02)               (0.04)              (0.05)
Accounting change                                       --               (0.03)                  --               (0.03)
                                          ----------------    ----------------      ---------------     ---------------
Basic and diluted loss per share          $          (0.01)              (0.05)               (0.04)              (0.08)
                                          ================    ================      ===============     ===============

Weighted average shares
  Outstanding                                   45,600,678          24,151,476           45,600,678          24,053,228
                                          ================    ================      ===============     ===============
</TABLE>

See accompanying notes to condensed consolidated financial statements.

                                      -3-
<PAGE>

                GLOBAL DIAMOND RESOURCES, INC. AND SUBSIDIARIES

           Unaudited Condensed Consolidated Statements of Cash Flows

         For the nine month periods ended September 30, 1999 and 1998

<TABLE>
<CAPTION>
                                                                     Nine month periods ended
                                                              -------------------------------------
                                                               September 30,         September 30,
                                                                   1999                   1998
                                                              ---------------       ---------------
<S>                                                           <C>                   <C>
Cash flows from operating activities:
  Net loss                                                    $    (1,968,414)           (2,035,832)
  Adjustments to reconcile net loss to net
    cash used in operating activities:
    Depreciation                                                      323,317                 7,936
    Shares issued in consideration for
      Consulting fees                                                      --                    --
    (Increase) decrease in accounts receivable                        (69,212)                6,017
    Increase in inventory                                             (43,752)              (42,040)
    Increase (decrease) in accounts payable, accrued
      liabilities and current portion of long-term debt              (679,040)              323,134
                                                              ---------------       ---------------

       Net cash used in operating activities                       (2,437,101)           (1,740,785)
                                                              ---------------       ---------------

Cash flows provided by financing activities:
  Proceeds from exercise of common stock
    Warrants                                                               --                45,895
  Proceeds from long-term debt                                             --             1,400,000
  Repayment of long-term debt                                              --              (116,543)
                                                              ---------------       ---------------

    Net cash provided by financing activities                              --             1,329,352
                                                              ---------------       ---------------

Cash flows used in investing activities:
  Additions to fixed assets                                        (2,233,913)           (3,070,622)
                                                              ---------------       ---------------

Effects of exchange rates on cash                                    (174,672)             (336,227)
                                                              ---------------       ---------------

Net decrease in cash and cash equivalents                          (4,845,686)           (3,818,282)

Cash and cash equivalents, beginning of
  Period                                                            5,461,235             4,096,141
                                                              ---------------       ---------------

Cash and cash equivalents, end of period                      $       615,549               277,859
                                                              ===============       ===============
</TABLE>

See accompanying notes to condensed consolidated financial statements.

                                      -4-
<PAGE>

                GLOBAL DIAMOND RESOURCES, INC. AND SUBSIDIARIES

             Notes to Condensed Consolidated Financial Statements

           As of September 30, 1999 and for each of the three month
       periods and nine month periods ended September 30, 1999 and 1998

(1)  These condensed consolidated financial statements of Global Diamond
     Resources, Inc. (the "Company") do not include all of the information and
     footnotes required by generally accepted accounting principles for complete
     financial statements and should be read in conjunction with the financial
     statements and notes thereto included in the Company's Annual Report on
     Form 10-KSB.  In the opinion of management, the financial information set
     forth in the accompanying condensed consolidated financial statements
     reflect all adjustments necessary for a fair statement of the periods
     reported, and all such adjustments were of a normal and recurring nature.
     Interim results are not necessarily indicative of results for a full year.

(2)  Fixed Assets

<TABLE>
<CAPTION>
                                                             September 30,        December 31,
                                                                 1999                 1998
                                                            ---------------      --------------
     <S>                                                    <C>                  <C>
     Mining property:
       Caerwinning deposit, at cost                         $       515,235             534,868
     Less accumulated amortization                                  (50,102)            (13,392)
                                                            ---------------      --------------

                                                                    465,133             521,476
                                                            ---------------      --------------

     Mining properties under development:
       Grasdrif deposit                                           1,561,453           1,220,197
                                                            ---------------      --------------

     Mining equipment, at cost                                    5,003,200           3,123,268
       Less accumulated depreciation                               (553,239)           (290,883)
                                                            ---------------      --------------

                                                                  4,449,961           2,832,385
                                                            ---------------      --------------

     Office equipment, at cost                                       62,111              57,880
     Less accumulated depreciation                                  (43,151)            (28,173)
                                                            ---------------      --------------

                                                                     18,960              29,707
                                                            ---------------      --------------

                                                            $     6,495,507           4,603,765
                                                            ===============      ==============
</TABLE>

(3)  Production and Exploration expenses:
     Production expenses are net of diamonds recovered of $23,520 and $38,942
     for the three months ending September 30, 1999 and the nine months ending
     September 30, 1999, respectively. Exploration expenses are net of diamonds
     recovered of $28,688 and $15,343 for the three months ending September 30,
     1999 and the nine months ending September 30, 1999, respectively.

                                      -5-
<PAGE>

ITEM 2.    Management's Discussion and Analysis or Plan of Operations

Background
----------

     The Company is engaged in diamond exploration and mining.  The Company has
acquired two mining properties (the Grasdrif Deposit and the Caerwinning
Deposit) and owns an option to purchase a third mining property (the Montrose
Kimberlite Pipe), all of which are located in the Republic of South Africa.  The
Company intends to conduct exploration and acquisitions of additional diamond
pipes and alluvial deposits and is continuously evaluating potential property
acquisitions.

     To date, the Company's activities have included the investigation and
acquisition of mining property interests, exploratory work, site establishment
and purchase and operation of mining plant and equipment.  During the nine
months ended September 30, 1999, the Company purchased mining plant and
equipment for and incurred site establishment costs for the development of the
upper terrace at the Grasdrif Deposit in the amount of $707,671. In addition,
the Company invested $1,469,715 in the first nine months on the purchase of
mining plant and equipment and purchase and erection of a wet primary recovery
plant at the Caerwinning Deposit to increase tonnage processed and improve
recovery.  The wet plant was placed into production during the current quarter.

Results of Operations
---------------------

     The production expenses were incurred at the Caerwinning Deposit, which
commenced production in September 1998.  Due to higher than normal rainfall in
the area, run off from the irrigation lands, as well as a higher than normal
water table, wet ore from the T2 terrace had to be processed by the primary
recovery plant, which was designed as a dry primary recovery plant.  This caused
a drop in tonnes processed as well as in the recovery rate of diamonds.  The
Company erected a wet recovery plant at this mine, which commenced production
during the current quarter, resulting in a marked improvement.  Diamonds
totaling 664.82 carats were sold for $340,095 during September 1999 at an
average price per carat of  $511.56,  2.3% over the budget of $500 per carat.

     The exploration expenses, incurred at the Grasdrif Deposit, were $190,753,
net of diamonds recovered of $28,688 for the three months ended September 30,
1999 and $376,148, net of diamonds recovered of $15,343 for the nine months
ended September 30, 1999. Production will only commence if the exploration
yields positive results. The lower terrace at the Grasdrif Deposit contains 77
million tonnes of gravel of which the Company has bulk sampled 115,800 tonnes
through September 30, 1999, which represents about 0.15% of the deposit. Between
August 1998 and March 1999 the grade was disappointing. During the previous
quarter, however, the grade had improved significantly. The entire run-of-mine
production, consisting of 57 diamonds with a total weight of 142.47 carats, was
sold for $103,584 during July 1999. This equates to an average price of $727.06
per carat, 16% over the budget of $625 per carat. A dense media separation plant
was commissioned on the upper terrace to conduct trial mining of this terrace
during the third quarter of 1999.

     The option to prospect for diamonds at the Montrose Kimberlite Pipe was
extended for another year during September 1999 to October 1999.

     The increase in interest expense is due to an increase in the amount
owed on the 15%, $3,000,000 International PCM Holdings loan from $1,600,000 in
1998 to $3,000,000 in 1999. The increase in aggregate Company expenses is mainly
due to the additional overhead expenses incurred in supporting the production at
the Caerwinning Deposit, which commenced in September 1998, the bulk sample at
the Grasdrif deposit and the erection of plant and equipment at both deposits.

     The Company's mining properties, mining properties under development and
mining equipment are all situated in the Republic of South Africa, where the
currency is the Rand.  At December 31, 1998 the rate was Rand 5.865 to US$1 and
at September 30, 1999, the rate was Rand 6.1057 to US$1. The revaluation of the
Company's property and equipment caused most of the positive foreign currency
translation adjustment of $6,681 for the three months ended September 30, 1999.
At November 12 1999, the rate was Rand 6.2483 to US$1.

                                      -6-
<PAGE>

Liquidity and Capital Resources
-------------------------------

     The Company has financed its activities to date through the sale of its
equity and debt securities. A $6 million equity and debt financing agreement was
completed in December 1997 and a $6 million equity financing was completed in
December 1998. The Company's plan of operations for the next 12 months include
the completion of exploratory work at the Montrose Kimberlite Pipe properties,
the completion of exploratory work and commencement of mining operations at the
Grasdrif Deposit and continuation of mining operations at the Caerwinning
Deposit.

     Even though the Company has net current assets at September 30, 1999
amounting to $555,313, the Company believes that it requires, at minimum,
additional working capital of $3,000,000 to satisfy its working capital
requirements for the next 12 months, including the capital that will be required
to conduct the bulk sample at the Montrose Kimberlite Pipe. Should only one of
the following events occur, additional working capital would be needed in the
next 12 months.

These events are:

          (a)  that the Caerwinning Deposit has negative cash flow from
               operations;
          (b)  the bulk sample at the Grasdrif Deposit does not identify a
               profitable area of diamondiferous grade of gravel to mine and
               profitable mining operations do not commence; or
          (c)  the mining on the Upper Terrace at Grasdrif results in an
               operating loss.

     The Company is in discussions with bankers to obtain financing secured by
new mining and earthmoving equipment, held free and clear, with a net book value
at September 30, 1999 of $4,449,961.  However, there is no assurance that the
Company will be able to raise the additional capital it requires through the
equipment refinancing or otherwise.  In the event that the Company is unable to
raise the working capital it needs, it will focus its efforts on the profitable
activities that its resources can support at that time.

     The Company's beliefs concerning its working capital requirements are based
on certain assumptions concerning, among other things, the estimated grade of
the processed ore, average price per carat of diamond, commencement and scale of
mining operations, Rand - US$ exchange rate and cost of production. If any of
these assumptions prove incorrect, the Company may require additional capital.
Any such additional financing may require an additional pledge or mortgage of
the Company's properties and of any production therefrom. There is, of course,
no assurance that satisfactory financing, if necessary could be obtained
therefor. In addition to financing the individual development projects, the
Company may also borrow funds from time to time for working capital and other
general corporate purposes.

Year 2000
---------

     The Company recognizes the need to ensure that its operations will not be
adversely impacted by Year 2000 hardware and software failures.  Failures due to
processing errors potentially arising from calculations using the Year 2000 date
are a known risk.  The Company has addressed this risk as to the availability,
integrity and reliability of financial accounting and operational systems.  The
Company has completed Year 2000 compliant testing on all hardware used for
financial accounting systems.  Assurance has been received from the software
vendors of the accounting systems that all their software in use by the Company
is Year 2000 compliant.  The Company considers its systems to be Year 2000
compliant and does not expect to incur any further material costs in connection
with Year 2000 issues.  All expenses to date have been written off as incurred.
Since the Company's mining equipment is not date sensitive, the most likely
worse case scenario is the loss of supply of power and fuel to the mining
operations.  The Company has been assured by the suppliers of  power and fuel
that they are Year 2000 compliant.

                                      -7-
<PAGE>

     This report contains various forward-looking statements that are based on
the Company's beliefs as well as assumptions made by and information currently
available to the Company. When used in this report, the words "believe,"
"expect," "anticipate," "estimate" and similar expressions are intended to
identify forward-looking statements. Such statements are subject to certain
risks, uncertainties and assumptions, including, without limitation, that as of
this date the Company has just commenced mining operations at any of its three
mines; the lack of proven reserves at any of the Company's three mines; mining
risks generally; political risks associated with the Company's operations in the
Republic of South Africa; general economic conditions; currency fluctuations;
and estimates of costs of production. Should one or more of these risks or
uncertainties materialize, or should underlying assumptions prove incorrect,
actual results may vary materially from those anticipated, estimated, or
projected. The Company cautions potential investors not to place undue reliance
on any such forward-looking statements, all of which speak only as of the date
made.


PART II - OTHER INFORMATION

Item 1.  Legal Proceedings.
         -----------------

               In July 1999, the Company and its Chairman, Johann de Villiers,
were named as defendants in an action brought by Mr. Abu Bakr Bin Ali Al-Akhdar
Mood in the United States District Court for the Southern District of
California. Mr. Abu Bakr is a former director of the Company. In that action,
Mr. Abu Bakr alleges that he acted as a finder in connection with the sale of a
total of $6,000,000 of the Company's common stock to two private investors (LIWA
Diamond and New Diamond) and that in connection with that offering, he was
entitled to a finders' fee equal to approximately 28% of the gross proceeds. Mr.
Abu Bakr alleges that the Company and Mr. de Villiers fraudulently forced Mr.
Abu Bakr to participate in a binding arbitration regarding his finders' fees and
that as a result of this arbitration, he was forced to return the finders' fee
and resign from his position as Managing Director of the Bin Ladin Group,
Petroleum, Chemical and Mining Division. Mr. Abu Bakr has alleged causes of
action for breach of contract, unjust enrichment, fraud, misrepresentation and
duress. Mr. Abu Bakr also alleges interference with and breach of his employment
contract with the Bin Ladin Group. Mr. Abu Bakr seeks compensatory and punitive
damages in an unspecified amount.

         In August 1999, the Company and Mr. de Villiers filed an answer to Mr.
Abu Bakr's complaint in which they denied all of the allegations contained
therein. The Company believes that the allegations of Mr. Abu Bakr are frivolous
and, accordingly, the Company intends to vigorously defend this case.

Item 2.  Changes in Securities.
         ---------------------

               Inapplicable.

Item 3.  Defaults Upon Senior Securities.
         -------------------------------

               Inapplicable.

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

               Inapplicable.

Item 5.  Other Information.
         -----------------

               Inapplicable.

                                      -8-
<PAGE>

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

               (a)  Exhibits
                    --------

                    Financial Data Schedule.

               (b)  Reports on Form 8-K
                    -------------------

                    Inapplicable.

                                      -9-
<PAGE>

                                  SIGNATURES


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

                                    Global Diamond Resources, Inc.
                                    (Registrant)


Dated:  November 18, 1999           By:  /s/ JOHANN DE VILLIERS
                                       ------------------------
                                       Johann de Villiers,
                                       Chief Executive Officer
                                        and Chief Financial Officer

                                      -10-