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

                                   FORM 10-K
(Mark One)

 [X]   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
      ACT OF 1934 [FEE REQUIRED] for the fiscal year ended March 31, 2003

                                       OR
 [  ]   TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
          ACT OF 1934 [NO FEE REQUIRED] for the transition period from
                            ____________to_________

                         Commission File Number: 0-21322

                                OUT-TAKES, INC.
                 (Name of small business issuer in its charter)

          Delaware                                   95-4363944
(State or other jurisdiction of           (I.R.S. Employer Identification No.)
 incorporation or organization)

1933 Upper Rim Rock Canyon, Laguna Beach, CA                        90213-0900
---------------------------------------------------                  ----------
(Address of principal executive offices)                            (Zip Code)

Issuer's telephone number: (949) 497-7159

Securities registered under Section 12(b) of the Act:

None

Securities registered under Section 12(g) of the Act:

Common Stock, $.01 par value
(Title of Class)

Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the issuer was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes X       No
                                                             -----       -----
Check if there is no disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K contained in this form, and no disclosure will be contained, to
the best of issuer's knowledge, in definitive proxy or information  statements
incorporated by reference in Part III of this Form 10-K, or any amendment to
this Form 10-K. ___

The issuer's revenues for the most recent fiscal year were $0.

The aggregate market value of the voting stock held by non-affiliates as of
March 31, 2003 was approximately $42,000.

                                                                            1
The number of shares outstanding of the issuer's Common Stock as of March 31,
2003 was 20,788,122.

Transitional Small Business Disclosure Format (Check One): Yes      No X



                               TABLE OF CONTENTS
                               -----------------

                                                                         PAGE
PART I                                                                   ----

  ITEM 1.   DESCRIPTION OF BUSINESS                                       3

  ITEM 2.   PROPERTIES                                                    19

  ITEM 3.   LEGAL PROCEEDINGS                                             20

  ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS           20

PART II
                                                                          20
  ITEM 5.   MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER
            MATTERS                                                       20

  ITEM 6.   SELECTED FINANCIAL DATA                                       21

  ITEM 7.   MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
            OPERATION                                                     21

  ITEM 8.   CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
            ACCOUNTING AND FINANCIAL DISCLOSURE                           40
 ITEM 8A.   CONTROLS AND PROCEDURES                                       40

PART III                                                                  40

  ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND
            CONTROL PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE
            EXCHANGE ACT                                                  40

  ITEM 10.  EXECUTIVE COMPENSATION                                        41

  ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
            OWNERS AND MANAGEMENT                                         41

  ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS                42

PART IV                                                                   42

  ITEM 13.  EXHIBITS AND REPORTS ON FORM 8-K                              42




                                                                            2

PART I

ITEM 1.  DESCRIPTION OF BUSINESS

Except for historical financial information contained herein, the matters
discussed in this annual report may be considered forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended and subject
to the safe harbor created by the Securities Litigation Reform Act of 1995.
Such statements include declarations regarding the intent, belief or current
expectations of the Company and its management. Prospective investors are
cautioned that any such forward-looking statements are not guarantees of
future performance and involve a number of risks and uncertainties; actual
results could differ materially from those indicated by such forward-looking
statements. Among the important factors that could cause actual results to
differ materially from those indicated by such forward-looking statements are:
that the information is of a preliminary nature and may be subject to further
adjustment, the possible unavailability of financing, risks related to the
development, acquisition and operation of power plants, the impact of avoided
cost pricing, energy price fluctuations and gas price increases, the impact of
curtailment, start-up risks, general operating risks, the dependence on third
parties, risks associated with the power marketing business, changes in
government regulation, the availability of natural gas, the effects of
competition, the dependence on senior management, volatility in the Company's
stock price, fluctuations in quarterly results and seasonality, and other
risks identified from time to time in the Company's reports and registration
statements filed with the Securities and Exchange Commission.


                                     GENERAL

Out-Takes, Inc., a corporation incorporated in Delaware on March 18, 1992
("the Company"), up until October 26, 1998, was engaged in the sale of
photographic  portraits of children, adults and family groups. On or about
August 31, 1998, the Company acquired all of the issued and outstanding units
of equity of Los Alamos Energy, LLC, which operates a 1 mega watt power plant
in Los Alamos, California, which produces electricity from "waste gas," and
shifted its business emphasis to that of electrical energy provider.

On or about October 26, 1998, the Company leased its photo studio assets to
Colorvision International, Inc., completing the shift of its business focus to
the providing of electrical energy. On March 30, 2001, the Company assigned
this asset lease agreement in lieu of cash to pay down a note payable,
including accrued interest, and issued a $150,000 promissory note, dated March
31, 2001 with respect to the repayment of the balance of the indebtedness.

During the year ended March 31, 2002, the Company was forced to terminate its
operations because of lack of cash flow, brought about by problems arising
from the changes in the power industry in the state of California.  The
Company was generating and selling electricity on a wholesale basis to the
Independent System Operator (The State of California), but, given the size of
the Company's present power plant, and the unpredictability of wholesale
prices in the ten minute decrimental market with the Independent System
Operator, the Company was not able to operate on revenues generated solely from
wholesale sales of electricity.
                                                                            3

                               RECENT DEVELOPMENTS


Los Alamos Energy has historically sold power to PG&E. Due to uncertainties
arising form PG&E's bankruptcy, in 2002, Los Alamos Energy elected to terminate
its contract with PG&E, and instead entered into a Participating Generator
Agreement with the California Independent System Operator ("ISO"), and sold
power to the CAISO through the Automated Power Exchange as its Scheduling
Agent.

The Company's plant has been completely inoperational since 2002, during which
time the Company has sought merger and combination opportunities, with no
success.  During the last fiscal year, the power industry has somewhat
stabilized, making it possible for the Company to enter into a new puower
purchase agreement with PG&E and to recommence operations.  In order to
recommence power operations, the Company must first service and refurbish Los
Alamos Energy's power generation equipment, and to pay current its obligations
with Nickson's Machines, the company who services the equipment.  The Company's
new management intends to offer an informal reorganization plan to creditors
which, if successful, will allow it to move forward in the recommencement of
its operations.

The recommencement of operations of the power plant is dependent upon the
Company's ability to procure capital and generate positive cash flows from
operations.  If the Company is unable to obtain such financing, the Company
will note be able to operate. These factors raise substantial doubt about the
Company's ability to continue as a going concern.  The consolidated financial
statements do not include any adjustments relating to the reclassification of
recorded asset amounts or amounts and classifications of liabilities that might
be necessary should the Company be unable to continue its existence.

Management plans to take steps that it believes will be sufficient to provide
the Company with the ability to continue in existence, and the Company is
seeking additional equity or debt financing. There can be no assurances that
sufficient financing will be available on terms acceptable to the Company.



                                LOS ALAMOS ENERGY

Los Alamos Energy was formed in June, 1996, for the purpose of becoming a
principal electricity provider in the State of California. With the
acquisition of Los Alamos Energy, the Company is engaged in a "niche" area of
electricity production from "waste gas," natural gas which is produced in
conjunction with oil production, but for which there is no market. Normally,
waste gas is flared, or burned. The procurement of waste gas provides an
inexpensive source of fuel for the Company's generators, which are located
adjacent to an oil and gas lease, and from which LAE receives its gas.

On August 31, 1998, the Company entered into a Share Purchase Agreement (the
"Acquisition Agreement") whereby the Company acquired (the "Acquisition") all
of the issued and outstanding equity interests in Los Alamos Energy, LLC, a
California limited liability company ("LAE"). The purchase price to be paid
for the equity interests of LAE was Four Million Dollars ($4,000,000), which
was paid by a Promissory Note (the "Note") to the holders of LAE equity (the
                                                                            4
"Equity Holders") calling for interest on all outstanding amounts to accrue at
the rate of ten percent (10%) per annum. Payments of principal and accrued
interest under the Note are to be made monthly in arrears up to the maturity
date, which is the fifth anniversary of the Note. The Notes may be prepaid at
any time without premium or penalty.

The Acquisition Agreement provides that, in the event the Equity Holders shall
desire to do so, they may convert their indebtedness to common stock of the
Company representing in the aggregate ninety percent (90%) of the issued and
outstanding shares of such common stock as of the date of such conversion. The
Acquisition Agreement provides that it is a condition of the conversion that
the Company effect a reverse stock split of one (1) share for every one
hundred (100) shares issued and outstanding as of such date. LAE contemplates
that none of the persons currently holding promissory notes and/or working
interests in its electricity production (collectively, "Interest Holders")
will exercise their rights to convert such interests into the equity of LAE,
and subsequently to join in the conversion of the Notes into common stock of
the Company. In the event that Holders do elect to convert, and after giving
effect to the contemplated reverse stock split, the Company will issue
approximately three million (3,000,000) additional shares of common stock, and
that subsequent to completing the conversion, the Equity Holders and Interest
Holders will own, in the aggregate, approximately two million eight hundred
eighty thousand (2,880,000) shares of the Company's common stock, representing
ninety percent (90%) of the total amount of common stock estimated to be
issued and outstanding as of the date such conversion rights are exercised. As
of March 31, 2003, the holders have not yet exercised their right to convert
the note to common stock.

The indebtedness represented by the Note is secured by (a) a Security
Agreement, granting a first lien and security interest upon all of the assets
of the Company; and (b) a pledge of the common stock of the Company held by
Photo Corporation Group Pty Limited, an Australian corporation, which is the
controlling stockholder of the Company. The stock pledge grants the Holders
specific rights under certain circumstances, including the right to receive
distributions made by the Company in respect of its common stock and the right
to vote the pledged shares, for so long as the Notes are in force.

The purchase price to be paid by the Company for all of the issued and
outstanding equity of LAE was negotiated based upon several factors,
including, without limitation, the asset value of LAE and its projected income
from operations based, in part, upon management's estimates of its natural gas
reserves and its current contracts.



                                   THE MARKET

The power industry represents the third largest industry in the United States,
with an estimated end user market of over $250 billion of electricity sales in
1998 produced by an aggregate base of power generation facilities with a
capacity of approximately 750,000 megawatts. In response to increasing
customer demand for access to low cost electricity and enhanced services, new
regulatory initiatives have been and are continuing to be adopted at both the
state and federal level to increase competition in the domestic power

                                                                            5
generation industry. Management believes that this increase in competition
will benefit rather than harm the Company, because the Company will be free to
sell its power to any customer, rather than to just PG&E, who is now obligated
to buy all the power the Company can produce. Management expects that with the
advent of deregulation, prices for power will increase over and above what it
the Company is being paid by PG&E. The power generation industry historically
has been largely characterized by electric utility monopolies producing
electricity from old, inefficient, high-cost generating facilities selling to
a captive customer base. Industry trends and regulatory initiatives have
transformed the existing market into a more competitive market where end users
purchase electricity from a variety of suppliers, including non-utility
generators, power marketers, public utilities and others. There is a
significant need for additional power generating capacity throughout the
United States, both to satisfy increasing demand, as well as to replace old
and inefficient generating facilities. Due to environmental and economic
considerations, management believes this new capacity will be provided
predominantly by gas-fired facilities. Management believes that these market
trends will create substantial opportunities for efficient, low-cost power
producers that can produce and sell energy to customers at competitive rates.

In addition, as a result of a variety of factors, including deregulation of
the power generation market, utilities, independent power producers and
industrial companies are disposing of power generation facilities. To date,
numerous utilities have sold or announced their intentions to sell their power
generation facilities and have focused their resources on the transmission and
distribution segments. Many independent producers operating a limited number
of power plants are also seeking to dispose of their plants in response to
competitive pressures, and industrial companies are selling their power plants
to redeploy capital in their core businesses.


                                    STRATEGY

The Company's strategy, until recent adverse developments affecting the
electricity industry in California, was to expand its existing power plant to
4 mW, and to further expand its power producing capacity by exploring
acquisition opportunities in the power market by exploring other opportunities
for growth and development.

The Company is seeking debt and equity financing to raise operating capital,
and is developing a new plan of operations whereby it will reorganize its
existing debt and raise capital to recommence its operations.  Both of these
measures are hoped to enable the Company to being operating its power plant
again.

                            DESCRIPTION OF FACILITIES

The Company procured the use of all of the natural gas reserves on the Blair
Oil and Gas Field ("the field"), which is located adjacent to the
unincorporated town of Los Alamos, California, on Rancho El Roblar,
approximately 60 miles north of Santa Barbara along US 101, and which is
operated by an oil and gas Operator. The field has 15 oil wells producing
approximately 500 barrels of oil per day, and from which approximately one
million cubic feet (1073 BTU) of natural gas is being flared. The gas
                                                                            6
recoverable reserve is estimated to be sufficient to provide electrical
production for the next several years.

During 1986, the Blairs entered into an agreement with American Cogenics of
California ("ACI") to convert the waste gas into electricity, and two gas
driven, CAT G398T generator sets ("Gensets"), each respectively 550 kilowatts
and 600 kilowatts, were installed, from which electricity was generated and
sold to PG&E, pursuant to a power purchase agreement, dated November 28, 1988
(the "PG&E contract"). In early 1995, the Santa Barbara County Air Pollution
Control District ("APCD") shut down the operation due to emissions violations.

During October, 1996, Los Alamos Energy consummated the purchase and sale
agreement with American Cogenics of California ("ACI"), dated August 28, 1996,
and acquired the rights to the gas, the two generator sets, the PG&E contract,
the FERC certification, and power purchase agreement with the oil and gas
Lease Operator, and brought the equipment into regulatory compliance.

When the generators were initially installed, there were only a few wells
producing oil and gas on the field. Since that time, production has increased
from about 150 MCFD to about 1,000 MCFD currently, providing the potential of
adding more generators to increase the Company's current capacity from 1 mega
watt (1 mW) to 4mW, at an estimated cost of $2 million to $4 million.


GOVERNMENT REGULATION

The Company is subject to complex and stringent energy, environmental and
other governmental laws and regulations at the federal, state and local levels
in connection with the development, ownership and operation of its energy
generation facilities. Federal laws and regulations govern transactions by
electrical and gas utility companies, the types of fuel which may be utilized
by an electric generating plant, the type of energy which may be produced by
such a plant and the ownership of a plant. State utility regulatory
commissions must approve the rates and, in some instances, other terms and
conditions under which public utilities purchase electric power from
independent producers and sell retail electric power. Under certain
circumstances where specific exemptions are otherwise unavailable, state
utility regulatory commissions may have broad jurisdiction over non-utility
electric power plants. Energy producing projects also are subject to federal,

state and local laws and administrative regulations which govern the emissions
and other substances produced, discharged or disposed of by a plant and the
geographical location, zoning, land use and operation of a plant. Applicable
federal environmental laws typically have both state and local enforcement and
implementation provisions. These environmental laws and regulations generally
require that a wide variety of permits and other approvals be obtained before
the commencement of construction or operation of an energy-producing facility
and that the facility then operate in compliance with such permits and
approvals.


                            FEDERAL ENERGY REGULATION

As described below, the exemptions from extensive federal and state regulation
afforded by PURPA to Qualifying Facilities are important to the Company and
                                                                            7
its competitors. The project that the Company currently owns meet the
requirements under PURPA to be a Qualifying Facilities and will be maintained
on that basis. Additionally, management expects regulatory impositions on
power marketing operations to be minimal under existing regulatory standards.


                                      PURPA

The enactment of the Public Utility Regulatory Policies Act of 1978, as
amended ("PURPA") and the adoption of regulations thereunder by the Federal
Energy Regulatory Commission ("FERC") provided incentives for the development
of small power facilities (those having a capacity of less than 80 megawatts.)
A domestic electricity generating project must be a Qualifying Facility ("QF")
under FERC regulations in order to take advantage of certain rate and
regulatory incentives provided by PURPA. PURPA exempts QF's from most
provisions of the Federal Power Act ("FPA") and, except under certain limited
circumstances, state laws concerning rate or financial regulation. In order to
be a Qualifying Facility, a cogeneration facility must (i) produce not only
electricity but also a certain quantity of thermal energy (such as steam)
which is used for a purpose other than power generation, (ii) meet certain
energy operating and efficiency standards when oil or natural gas is used as a
fuel source and (iii) not be controlled or more than 50% owned by an electric
utility or electric utility holding company, or any combination thereof.

PURPA provides two primary benefits to Qualifying Facilities owned and
operated by non_utility generators. First, Qualifying Facilities under PURPA
are exempt from certain provisions of PUHCA, the Federal Power Act (the "FPA")
and, except under certain limited circumstances, state laws respecting rate
and financial regulation. Second, PURPA requires that electric utilities
purchase electricity generated by Qualifying Facilities at a price equal to
the purchasing utility's full "avoided cost" and that the utility sell back_up
power to the Qualifying Facility on a non_discriminatory basis. Avoided costs
are defined by PURPA as the "incremental costs to the electric utility of
electric energy or capacity or both which, but for the purchase from the
Qualifying Facility or Qualifying Facilities, such utility would generate
itself or purchase from another source." The FERC regulations also permit
Qualifying Facilities and utilities to negotiate agreements for utility
purchases of power at rates other than the purchasing utility's avoided cost.
Although public utilities are not required by PURPA to enter into long_term

contracts, PURPA helped to create a regulatory environment in which it has
become more common for such contracts to be negotiated or executed through
selective procurement or competitive bidding. If Congress amends PURPA, the
statutory requirement that an electric utility purchase electricity from a
Qualifying Facility at full avoided costs could be eliminated. Although
current legislative proposals specify the honoring of existing contracts,
repeal of the statutory purchase requirements of PURPA going forward could
increase pressure to renegotiate existing contracts. Any changes which result
in lower contract prices could have an adverse effect on the Company's
operations and financial position. See Competition.




                                                                            8
                                      PUHCA

Under the Public Utility Holding Company Regulation ("PUHCA"), any person
(defined by PUHCA to include corporations and partnerships and other legal
entities) which owns or controls ten percent or more of the outstanding voting
securities of a "public utility company" or a company which is a "holding
company" of a "public utility company" is subject to registration with the
Securities and Exchange Commission (the "Commission") and regulation under
PUHCA, unless such person is eligible for an exemption, such as is available
to Qualifying Facilities under PURPA, or as established elsewhere under PUHCA.
A registered holding company is required by PUHCA to limit its operation to a
single integrated utility system and to divest any other operations not
functionally related to the operation of that utility system.


                                 THE ENERGY ACT

Congress passed the Energy Act to promote further competition in the
development of new wholesale power generation sources. Through amendments to
PUHCA, the Energy Act encourages the development of independent power projects
which will be certified by the FERC as exempt wholesale generators ("EWGs").
The owners or operators of these facilities are exempt from the provisions of
PUHCA. The Energy Act also provides the FERC with extensive new authority to
order electric utilities to provide other electric utilities, Qualifying
Facilities and independent power projects with access to their transmission
systems. However, the Energy Act does preclude the FERC from ordering
transmission services to retail customers and prohibits sham wholesale energy
transactions which appear to provide wholesale service, but actually are
providing service to retail customers.

A company engaged in the ownership or operation of electric power generation
and transmission facilities faces certain types of regulation for its
international activities. The principal regulatory consideration for
international projects is PUHCA, since it is broadly applicable to the
ownership and operation of power facilities (including generation and
transmission facilities) both inside and outside of the United States. For
international projects, the principal basis for exemption from PUHCA is by
obtaining EWG status from the FERC. EWG status is even more beneficial for
international projects because, although EWGs are not permitted to make retail
sales in the United States, retail sales by EWGs are generally allowed in
international markets. Another way to obtain an exemption from PUHCA for
foreign ownership and operation activities is by filing a foreign utility
company determination ("FUCO") with the Commission. However, FUCO filings are
less frequently used, because unlike EWGs, no formal regulatory order is
issued confirming the status of a FUCO, and more rigorous state commission
scrutiny is entailed.

Structuring the Company's activities to ensure that it is not a "holding
company" of a "public utility company" under PUHCA is also important in
providing financing and financial reporting flexibility to the Company. The
cogeneration facilities owned by the Company, or in which the Company has
investments, are Qualifying Facilities under PURPA. The Company has also
pursued the development of independent power projects which will not qualify
for the benefits provided by PURPA, which could subject these projects to
PUHCA jurisdiction. To avoid such a consequence, the Company will structure
its participation in independent power projects in a manner to qualify for

                                                                            9
exemptions under PUHCA provided by the Energy Act. Such structures will permit
the Company to take ownership positions in a number of independent power
project projects.

                                      FPA

The Federal Power Act ("FPA") grants the FERC exclusive rate-making
jurisdiction over wholesale sales of electricity in interstate commerce. The
FPA provides the FERC with ongoing as well as initial jurisdiction, enabling
the FERC to revoke or modify previously approved rates. Such rates may be
based on a cost-of-service approach or on rates that are determined through
competitive bidding or negotiation on a market basis.

Although Qualifying Facilities under PURPA are exempt from rate_making and
certain other provisions of the FPA, independent power projects and certain
power marketing activities are subject to the FPA and to the FERC's rate-
making jurisdiction.

Utilities are not obligated to purchase power from projects subject to
regulation by the FERC under the FPA because they do not meet the requirements
of PURPA. However, because such projects would not be bound by PURPA's thermal
energy use requirement, they may have greater latitude in site selection and
facility size. The project currently owned or operated by the Company as a
Qualifying Facility under PURPA is exempt from the FPA. FERC has significantly
relaxed the rules under which power marketers and independent power producers
can sell or market power. With approval from FERC, such entities, with certain
exceptions, are exempted from cost_based rates and can make all sales at
market-based rates set through negotiations. The independent power project in
which the Company currently participates have been granted market based rate
authority and comply with the FPA requirements governing approval of wholesale
rates and subsequent transfers of ownership interest in such projects.


                         CHANGES IN FEDERAL REGULATIONS

Historically in the United States, regulated and government-owned utilities
have been the only significant producers of electric power for sale to third
parties. The energy crisis of the 1970s led to the enactment of the federal
Public Utility Regulatory Policies Act of 1978 ("PURPA"), which encouraged
companies other than utilities to enter the electric power business by
reducing regulatory constraints. In addition, PURPA and its implementing
regulations created unique opportunities for the development of cogeneration
facilities by requiring utilities to purchase electric power generated in
cogeneration plants meeting certain requirements (referred to as "Qualifying
Facilities").

As a result of PURPA, a significant market for electric power produced by
independent power producers such as the Company developed in the United
States. In 1992, Congress enacted the Energy Policy Act of 1992 ("Energy
Act"), which amended the Public Utility Holding Company Act of 1935 ("PUHCA")
to create new exemptions from PUHCA for independent power producers selling
electric energy at wholesale, to increase electricity transmission access for
independent power producers and to reduce the burdens of complying with
PUHCA's restrictions on corporate structures for owning or operating

                                                                           10
generating or transmission facilities in the United States or abroad. The
Energy Act has enhanced the development of independent power projects and has
further accelerated the changes in the electric utility industry that were
initiated by PURPA. Implementation of federal and state policies resulting in
increased availability of transmission access for wholesale and retail
transactions could create additional markets and competition for electricity
power sales.

The Company believes it is possible that changes in PURPA, PUHCA and other
related federal statutes may occur in the next several years. The nature and
impact of such changes on the Company's projects operations and contracts is
unknown at this time. The Company is actively monitoring these developments
directly and through industry trade groups to determine such impacts as well
as to evaluate new business opportunities created by restructuring of the
electric power industry. Depending on the outcome of these legislative
matters, changes in legislation could have an adverse effect on current
contract prices.


                                STATE REGULATION

State public utility commissions, pursuant to state legislative authority,
have jurisdiction over how any new federal initiatives are implemented in each
state and have broad jurisdiction over regulated independent power projects
which are not Qualifying Facilities under PURPA, and which are considered
public utilities in many states. Such jurisdiction would include the issuance
of certificates of public convenience and necessity to construct a facility as
well as regulation of organizational, accounting, financial and other
corporate matters on an ongoing basis. Although the FERC generally has
exclusive jurisdiction over the rates charged by an independent power project
to its wholesale customers, state public utility commissions have the
practical ability to influence the establishment of such rates by asserting
jurisdiction over the purchasing utility's ability to pass through the
resulting cost of purchased power to its retail customers. In addition, states
may assert jurisdiction over the siting and construction of independent power
projects and, among other things, issuance of securities, related party
transactions and sale and transfer of assets. The actual scope of jurisdiction
over independent power projects by state public utility regulatory commissions
varies from state to state.

In the State of California, restructuring legislation was enacted in September
1996 and was implemented in 1998. This legislation established an Independent
Systems Operator ("ISO") responsible for centralized control and efficient and
reliable operation of the state-wide electric transmission grid, and a Power
Exchange responsible for an efficient competitive electric energy auction open
on a non-discriminatory basis to all electric services providers. Other
provisions include the quantification and qualification of utility stranded
costs to be eligible for recovery through competitive transition charges
("CTC"), market power mitigation through utility divestiture of fossil
generation plants, the unbundling and establishment of rate structure for
historical utility functions, the continuation of public purpose programs and
issues related to issuance of rate reduction bonds.

The California Energy Commission ("CEC") and Legislature have responsibility
for development of a competitive market mechanism for allocation and
                                                                           11
distribution of funds made available by the legislation for enhancement of in-
state renewable resource technologies and public interest research and
development programs. Funds are to be available through the four-year
transition period to a fully competitive electric services industry.

In addition to the significant opportunity provided for power producers such
as the Company through implementation of customer choice (direct access), the
California restructuring legislation both recognizes the sanctity of existing
contracts, provides for mitigation of utility horizontal market power through
divestiture of fossil generation and provides funds for continuation of public
services programs including fuel diversity through enhancement for in-state
renewable technologies (includes geothermal) for the four-year transition
period to a fully competitive electric services industry.


                            TRANSMISSION AND WHEELING

Energy-producing projects that sell power to customers which are not
geographically located near the project require that the project have the
capability of transmitting its power over utility power transmission grids to
the purchaser ("wheeling"). The FERC and state utility regulatory commissions
have jurisdiction over the wheeling of power to remote users; the prices and
related terms and conditions of wheeling in interstate commerce are regulated
by the FERC. At the moment, the Company's customers being serviced by Los
Alamos Energy are in the same geographical area as the Company's power plant.

The PUCT has promulgated rules that require affected utilities to provide
wheeling service. These rules are in effect in the Electrical Reliability
Counsel of Texas system and the new transmission access provisions of the
Energy Act do not alter that federal and state jurisdictional balance.

Rules adopted at the FERC and a number of state utility regulatory commissions
require utilities to grant power producers increased access to transmission
and wheeling. The provisions of the Energy Act increase such access. The
Energy Act supports increased transmission access, and in April 1996 the FERC
adopted rules (Order 888) to expand significantly transmission service and
access and provide alternative methods of pricing for transmission services.
Upon promulgation of the final rule by the FERC (and the PUCT for ERCOT), the
interstate transmission grid in the continental United States was opened to
all qualified persons that seek transmission services to wheel wholesale
power. Utilities are required to provide transmission customers non-
discriminatory open access to their transmission grids with rates, terms, and
conditions comparable to that which the utility imposes on itself. This
provides the Company with increased opportunities to sell and market the power
produced by its independent power projects. It also increases competition on a
nationwide basis between traditional and non-traditional power generators,
such as the Company.

                            ENVIRONMENTAL REGULATION

The construction and operation of domestic and international energy and fuel
producing projects and the exploitation of natural resource properties are
subject to extensive federal, state and local laws and regulations adopted for
the protection of the environment and to regulate land use. The laws and

                                                                           12

regulations applicable to the Company and projects in which it participates
primarily involve the discharge of emissions into the water and air, but can
also include wetlands preservation, noise regulation and a comprehensive
Environmental Impact Assessment which includes evaluation of the facility's
impact on air, water, ecology, human health and socioeconomic factors. These
laws and regulations in many cases require a lengthy and complex process of
obtaining licenses, permits and approvals from federal, state and local
agencies. Obtaining necessary approvals regarding the discharge of emissions
into the air is critical to the development of a project and can be time_
consuming and difficult. Each energy producing project requires technology and
facilities which comply with federal, state and local requirements and
sometimes extensive negotiations with administrative agencies. Meeting the
requirements of each jurisdiction with authority over a project can delay or
sometimes prevent the completion of a proposed project, as well as require
extensive modifications to existing projects.

The Company monitors environmental standards and evaluates its selection of
technology to ensure that applicable standards are being met. Based on current
trends, the Company expects that environmental and land use regulation will
become more stringent. Accordingly, the Company plans to continue to place a
strong emphasis on the development and use of state-of-the-art technology to
minimize potential impacts on the environment. In addition, the Company has
developed expertise and experience in obtaining necessary licenses, permits
and approvals.

In November 1990, comprehensive amendments to the Clean Air Act were
enacted(the "1990 Amendments"). The first major revisions to the Clean Air Act
since 1977, the 1990 Amendments vastly expand the scope of federal regulations
and enforcement in several significant respects. In particular, provisions
relating to non-attainment, air toxics, permitting, enforcement and acid
deposition may affect the Company's domestic projects. The Clean Air Act and
the 1990 Amendments contain provisions that regulate the amount of sulfur
dioxide and nitrogen oxides that may be emitted by a project. These emissions
may be a cause of "acid rain." The project the Company owns, operates or
plan's to investment in are, or will be fueled by natural gas and are not
expected to be significantly affected by the acid rain provisions of the 1990
Amendments.

One of the key elements of the 1990 Amendments is the inclusion of an
operating permit program in Title V. This program is intended to establish a
central point in tracking all applicable air quality requirements for every
source required to obtain a permit under the Clean Air Act. Final regulations
implementing these provisions were issued by the EPA in 1992. These
regulations created minimum requirements for the operating permit program.
Each state was required to submit a program for its implementation of the
regulations for approval to the EPA. The Company is required to submit
complete operating permit applications to those states in which it has
operating projects which meet the applicability standards under the 1990
Amendments.

                                   COMPETITION

The power generation industry is characterized by intense competition, and the
Company encounters competition from utilities, industrial companies and other
                                                                           13
power producers. The independent power industry has grown rapidly over the

past twenty years. The demand for power may be met by generation capacity
based on several competing technologies, such as gas-fired or coal-fired
cogeneration and power generating facilities fueled by alternative energy
sources including hydro power, synthetic fuels, solar, wind, wood, geothermal,
waste heat, solid waste and nuclear sources. The Company competes with other
non-utility generators, regulated utilities, unregulated subsidiaries of
regulated utilities and other energy service companies in the development and
operation of energy-producing projects and the marketing of electric power. In
recent years, there has been increasing competition in an effort to obtain
power sales agreements, and this competition has contributed to a reduction in
electricity prices. In addition, many states are implementing or considering
regulatory initiatives designed to increase competition in the domestic power
industry. In California, the CPUC issued decisions which provide for direct
access for all customers as of April 1, 1998. This competition has put
pressure on electric utilities to lower their costs, including the cost of
purchased electricity, and increasing competition in the future will increase
this pressure. However, management believes that the deregulation of the
electrical power industry in California will enable it to achieve higher
revenues from the sale of power.

At the Federal level, the Energy Act reduces certain restrictions currently
applicable to certain projects which are not Qualifying Facilities (as further
defined below) under PURPA and provides for the removal of certain impediments
to competition in the power generation industry. Although the provisions of
the Energy Act apply only to wholesale transactions, actions by many state
authorities are also increasing competition for industrial, commercial and
other larger scale customers in the provision of services by Qualifying
Facilities ("QF's"), and independent power projects, as well as power
marketers and other unregulated suppliers. The development rights of
Qualifying Facilities, which were facilitated by certain provisions of PURPA,
have not been affected, nor amended, by the Energy Act. However, proposed
legislation has been introduced in Congress to repeal all or part of PURPA.
These federal legislative proposals would not abrogate or amend existing
contracts with electric utilities and would only be effective prospectively
for new contracts.  Should PURPA be repealed, the company expects that
competition would severely increase.

The industry is presently characterized by rapid change in the regulatory and
commercial aspects of competition. Although the timing and ultimate effect of
these changes cannot be predicted, management of the Company believes that the
overall effect of the current changes will be to increase competition in the
generation, transmission and sale of electric power.


                                    EMPLOYEES

As of March 31, 2003, the Company employed 1 unsalaried person. None of the
Company's employees are covered by collective bargaining agreements, and the
Company has never experienced a work stoppage, strike or labor dispute. The
Company considers relations with the Company's employees to be good.


                                                                           14

ITEM 2.                            PROPERTIES

The Company rents offices from its President, Lance Hall, at no charge on a
month to month basis.  The Company owns two internal combustion
engine/generator sets located on the Blair Ranch. The Company owns all right,
title and interest in and to the power purchase agreement between with Lease
Operator, consisting of correspondence between the Operator and ACI and Mr. W.
P. Blair, as well as all right, title and interest in and to the Participating
Generator Agreement between LAE and the ISO.

       PATENTS, SERVICE MARKS, COPYRIGHTS AND OTHER PROPRIETARY TECHNOLOGY



The Company has no patents, copyrights or trademarks with respect to its power
plant operations.

ITEM 3. LEGAL PROCEEDINGS

On or about April 21, 2003, the Company was named in a lawsuit filed by Kurt
Knecht against Richard O'Connor, Coastal Resources Corporation, First Equity
Partners, LLC, Equity Partners, Equity Partners Fund, First Equity Partners
Funding, Inc., Nick Bulaich, Rose Connant, Shannon Illingworth, Jayne O'Connor,
Patrick Cox, Hannes Faul, Los Alamos Energy, LLC, and James Harvey.  The
lawsuit, filed in Orange County, California, Case No. 03CC05816, claims
$290,000 in damages for money the plaintiff allegedly invested in securities
with the defendants, on the theories of securities fraud, violation of
securities laws, fraud, conversion, restitution after rescission, money had and
received, breach of contract and money due on default of promissory note.  The
Company's involvement is the issuance of a note to Coastal Resources
Corporation, to unwind its merger transaction with Coastal Resources.  The
Company has had discussions with the plaintiff's attorneys, and believes it may
be possible to resolve the matter as against the company and Los Alamos Energy
in return for company common stock.  However, there can be no assurance that
the matter will be resolved, and the Company's exposure to liability is
approximately $290,000.

In addition, LAE and its Operator have in the past borrowed moneys from
different individuals from time to time, and in connection with such
borrowings, has issued notes,which notes provide for the conversion of such
notes into equity of LAE, and subsequently convertible into shares of common
stock of the Company upon the final consolidation of, and merger between LAE
and the Company. Substantially all of these notes together with interest
accrued thereon have matured, and are past due.  Due to the recent adverse
developments described elsewhere herein, the final merger between, or
consolidation of, LAE and the Company has not occurred, and is unlikely to
occur, and hence, no shares of the Company will be issued to such note holders.

LAE and the Operator have received demands for repayment of certain notes, and
we are currently in negotiation for the settlement of such demands. While the
outcome of ongoing negotiations is uncertain, management does not expect
litigation to commence in connection with the said demands, or if commenced,
does not constitute a materially adverse condition for the Company.

                                                                           15
ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

      None, during the fiscal year ended March 31, 2003.

                                   PART II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

The Company's Common Stock began trading on the Nasdaq Small Cap MarketSM
("NASDAQ") on March 9, 1993 under the symbol OUTT (also OUTTC during the
period from October 28, 1994 through December 30, 1994). On January 3, 1995,
the Company's securities were delisted from NASDAQ as a consequence of the
Company's not fulfilling the minimum bid price requirements set forth in
Paragraph 1(c)(4) of Schedule D of the NASDAQ By-Laws. On January 4, 1995, the
Company's Common Stock began to be quoted on the over-the-counter Bulletin
Board under the symbol OUTT'.  Effective July, 2003, the over-the-counter
Bulletin board added an E' to its trading symbol, making the symbol, OUTTE,'
signaling the Company's failure to timely file this report.  If this report is
filed by August 14, 2002, and if the Company is able to file its quarterly
report due for the quarter ended June 30, 2003, it may be able to retain its
quotation on the Bulletin Board with no further delay or application.

The following table sets forth, for the periods indicated, the high and low
closing prices for the Common Stock as reported by the over-the-counter
Bulletin Board.

                       Fiscal 2002            Fiscal 2003
                      High      Low          High      Low
                      ----      ----         ----      ----
First Quarter         .06       .03          .002      .002
Second Quarter        .06       .03          .002      .002
Third Quarter         .06       .03          .002      .002
Fourth Quarter        .03       .01          .002      .002

There were approximately 83 holders of record of the Company's Common Stock as
of March 31, 2003.

The Company has not paid any dividends on its Common Stock since incorporation
in March 1992 and does not anticipate paying dividends in the foreseeable
future. There are no restrictions on the Company's present ability to pay
dividends on its Common Stock, other than those prescribed by Delaware law.

ITEM 6. SELECTED FINANCIAL DATA

The following table sets forth certain data for the years ended March 31, 1999
through March 31, 2003. Refer to "Item 7. Management's Discussion and Analysis
or Plan of Operation" for discussion of operations.





                                                                           16


<TABLE>
<S>                           <C>        <C>              <C>         <C>          <C>
                              2003          2002          2001        2000         1999
                             -------    ---------        -------    --------     --------
Income Statement Data
Revenue from operations       $   0     $117,719        $541,755    $216,623     $637,450

Gross profit (Loss)       $(214,823)      42,830        $ 73,048      $4,300    ($445,076)

Income (loss) from
 operations               $(214,823) ($4,335,048)     ($ 346,178)  ($369,365)   ($289,726)

Net (Loss) Income         $(727,074) ($4,835,665)      ( $17,273)  ($884,110)   ($403,774)

Net loss per share           $(0.04)      ($0.24)         ($0.00)     ($0.04)     ($0.019)
Balance Sheet Data

Total Assets               $110,840     $187,526      $4,454,044  $4,550,824    $ 312,503

Total Liabilities        $7,458,271   $4,007,883      $6,438,736  $6,552,789   $1,667,725

Stockholders' Equity
 (Deficit)               (7,347,431) ($6,820,357)    ($1,984,692)($1,893,559) ($1,355,672)
</TABLE>

ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

The following discussion should be read in conjunction with the historical
financial statements of Out-Takes, Inc. ("the Company") and notes thereto
included elsewhere in this Form 10-K.

Overview

Through Los Alamos Energy, LLC, the Company operates a 1 mW waste gas
electricity plant in Los Alamos, California, which was acquired from American
Cogenics during 1996.  Up until the bankruptcy filing of Pacific Gas &
Electric and the recent power crisis in California, the Company  has
historically sold power to PG&E. Due to uncertainties arising form PG&E's
bankruptcy, Los Alamos Energy elected to terminate its contract with PG&E, and
instead entered into a Participating Generator Agreement with the California
Independent System Operator ("ISO"), and is currently selling power to the
CAISO through the Automated Power Exchange as its Scheduling Agent.  The
Company was, during January 2002, informed by the APX to the effect that
payments for electricity delivered to the ISO was being indefinitely suspended
pending the ISO's review of possible over payments made to participants, and
possible resulting adjustments. As a result of not being paid in a timely
manner, and/or partially and sporadically having been paid, the Company has as
of November 2001 shut its power plant down for fear of irreparable damage
absent routine and required maintenance, which the Company was not able to
perform absent payment for deliveries.

The Company is still not able to recommence its operations because of lack of
capital and cash flow, brought about by problems arising from the changes in
the power industry in the state of California.  Given the size of the
Company's present power plant, and the unpredictability of wholesale prices in
the ten minute decrimental market with the ISO, the Company has not able to
operate on revenues generated solely from wholesale sales of electricity.
However, the Company believes that it can enter into a new contract with PG&E
for the purchase of power, which management believes that will allow the
company to generate positive operating revenue.
                                                                           17
Changes in Plan of Operations

The California energy market, and the Company's participation therein remains
uncertain.  In view of these matters, the operation of the power plant is
dependent upon the Company's ability to procure capital and generate positive
cash flows from operations.  If the Company is unable to obtain such financing,
the Company will be forced to scale back operations, which could have an
adverse effect on its financial condition and results of operation.  The
Company has is taking steps it believes will be sufficient to provide the
Company with the ability to continue in existence, and the Company is seeking
additional equity or debt financing. There can be no assurances that sufficient
financing will be available on terms acceptable to the Company.
In addition to seeking a suitable merger or reverse acquisition candidate, the
Company is also in the process of developing a plan of operations whereby the
residents of the City of Los Alamos would form a cooperative to buy
electricity from the Company at retail prices.


Results of Operations

Year Ended March 31, 2003 Compared to Year Ended March 31, 2002.

The net loss for the year ended March 31, 2003 was $727,074 compared with a
net income of $17,273 for the year ended March 31, 2002. The primary reasons
for the change was that the company's power plant has been non operational for
the entire fiscal year. The Company overall generated $0 in revenues in the
fiscal year ended March 31, 2003, compared to revenues of $117,719 in the
fiscal year ended March 31, 2002. Management attributes this decrease to the
shut down of the power plant.

Year Ended March 31, 2001 Compared to Year Ended March 31, 2002.

The net loss for the year ended March 31, 2001 was $4,935,665 compared with a
net income of $17,273 for the year ended March 31, 2002. The primary reasons
for the change was the impairment of the goodwill totaling $4,062,321 during
the year ended March 31, 2002 and the asset agreement income totaling $874,231
during the year ended March 31, 2001. The Company overall generated $541,735
in revenues in the fiscal year ended March 31, 2001, compared to revenues of
$117,719 in the fiscal year ended March 31, 2002. Management attributes this
decrease to low energy prices, and the shut down of the power plant.


Liquidity and Capital Resources

At March 31, 2003, the Company had a working capital deficit of $3,458,223 as
compared to a working capital deficit on March 31, 2002 of $2,994,250.

Net cash used by operating activities was $186,260 for the fiscal year
ended on March 31, 2003, compared to the utilization of $62,495 of cash for
the year ended March 31, 2002.

In view of the shut down of the power plant, which is the Company's only
source of income, the Company's ability to meet its obligations for continuing
fixed expenses, materials procurement or operating labor is seriously in

                                                                           18
question, unless the Company is successful in raising capital through sales of
its common stock, which is doubtful under the current market conditions and
the status of the Company's quotation on the over-the-counter Bulletin  Board,
or the successful completion of a merger or reverse-acquisition of a suitable
company with adequate operating capital.


                           INDEPENDENT AUDITORS' REPORT

Board of Directors
Out-Takes, Inc.
Laguna Beach, California

I have audited the accompanying consolidated balance sheet of Out-Takes, Inc.
and subsidiary as of March 31, 2003, and the related consolidated statements
of operations, stockholders' deficit, and cash flows for the year then ended.
These consolidated financial statements are the responsibility of the
Company's management.  My responsibility is to express an opinion on the
consolidated financial statements based on my audit.

I conducted my audit in accordance with auditing standards generally
accepted in the United States of America.  Those standards require that I
plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement.  An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the consolidated financial statements.  An audit also includes assessing the
accounting principles used and significant estimates made by management, as
well as evaluating the overall consolidated financial statement presentation.
I believe that I audit provides a reasonable basis for my opinion.

In my opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of Out-Takes,
Inc. and subsidiary as of March 31, 2003, and the results of its operations
and its cash flows for the year then ended, in conformity with accounting
principles generally accepted in the United States of America.

The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern.  As discussed in Note 1 to
the accompanying consolidated financial statements, the Company has incurred
significant operating losses and retained deficit, which raises substantial
doubt about its ability to continue as a going concern.  The consolidated
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.

ROGELIO G. CASTRO,
---------------------------
CERTIFIED PUBLIC ACCOUNTANT

Oxnard, California
August 14, 2003

                                                                           18





                        OUT-TAKES, INC. AND SUBSIDIARY
                          CONSOLIDATED BALANCE SHEETS
ASSETS

                                                     March 31
                                                 2003       2002
                                               ---------  ---------
Current assets:
 Cash and cash equivalents                   $       48   $       -
 Other current assets                                -       13,633
                                               ---------  ---------
 Total current assets                                48      13,633
 Property and equipment, net of accumulated
  depreciation and amortization                 110,792     147,147

 Other assets                                         -      26,746
                                               ---------  ---------
                                             $  110,840  $  187,526
                                               =========  =========

                      LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
 Bank overdraft                              $        -  $      530
 Accounts payable and accrued expenses          177,201     160,373
 Accrued interest                             1,886,855   1,374,604
 Due to related party                           220,521     220,521
 Notes payable                                1,173,694   1,251,855
                                               ---------  ---------
 Total current liabilities                    3,458,271   3,007,883
  Long term debt                              4,000,000   4,000,000

Stockholders' deficit:

Common stock, par value at $0.01,
 35,000,000 shares authorized
 and 20,788,122 shares issued and
 20,788,122 shares outstanding                  207,882     207,882
 Additional paid-in capital                  10,178,230   9,913,230
 Retained deficit                           (17,625,137)(16,833,063)
 Treasury stock, 292,396 shares at cost        (108,406)   (108,406)
                                              ----------  ---------
 Total stockholders' deficit                 (7,347,431) (6,820,357)
                                              ----------  ---------
                                           $    110,840 $   187,526
                                               =========  =========
     See accompanying report and notes to consolidated financial statements
                                                                           19


                        OUT-TAKES, INC. AND SUBSIDIARY
                     CONSOLIDATED STATEMENTS OF OPERATIONS

                                  Year ended     Year ended     Year ended
                                  March 31,      March 31,      March 31,
                                  2003           2002           2001
                                  ----------     ----------     ----------

Revenues                         $         -     $  117,719     $ 541,755
Cost of revenues                           -         74,889       468,707
                                  ----------     ----------     ----------
Gross profit                               -         42,830        73,048

Operating expenses
Selling, general and administrative  214,823        315,557       310,656
Amortization and impairment
 of goodwill                               -      4,062,321       108,570
                                  ----------     ----------     ----------
Loss from operations                (214,823)    (4,335,048)     (346,178)
                                  ----------     ----------     ----------
Other income (expense):
Interest expense                    (512,251)      (515,760)     (510,780)

Asset lease agreement assignment           -              -       874,231
Loss on disposal of fixed assets           -           (600)            -
Miscellaneous                              -         15,743             -
                                   ---------     ----------     ----------
Total other income (expense)        (727,074)      (500,617)     (363,451)
Income (loss) before
 income taxes                       (727,074)    (4,835,665)       17,273
Income taxes                               -              -             -
                                  ----------      ----------     ----------
Net income (loss)                 $ (727,074)   $(4,835,665)    $  17,273
                                  ==========      ==========     ==========
Net income (loss) per share
 - basic and diluted              $(0.04)       $(0.24)           $   -
                                  ======        ======            =====
Number of weighted average share
 - basic and diluted             20,788,122      20,495,726     20,495,726
                                 ==========      ==========     ==========

     See accompanying report and notes to consolidated financial statements

                                                                           20




                        OUT-TAKES, INC. AND SUBSIDIARY
               CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT
               FOR THE YEARS ENDED MARCH 31, 2003, 2002 AND 2001

<TABLE>
<S>                             <C>        <C>        <C>          <C>          <C>          <C>
                                                    Additional                             Total
                                 Common stock       paid-in      Retained     Treasury  Stockholders'
                              Shares      Amount    capital       deficit      Stock      deficit
                              ---------   --------  ----------    --------    ---------   -----------
Balance at March 31, 1999    20,788,122  $207,882  $9,913,230  $(11,130,561) $ (108,406) $(1,117,855)
Net loss                              -         -           -      (884,110)          -     (884,110)
Balance at March 31, 2000    20,788,122   207,882   9,913,230   (12,014,671)   (108,406)  (2,001,965)
Net income                            -         -           -        17,273           -       17,273
Balance at March 31, 2001    20,788,122   207,882   9,913,230   (11,997,398)   (108,406)  (1,984,692)
Net loss                              -         -           -    (4,835,665)          -   (4,835,665)
Balance at March 31, 2002    20,788,122   207,882 $ 9,913,230  $(16,833,063) $ (108,406) $(6,820,357)
Net loss                                          (727,074)                (727,074)
Note payable conversion                               265,000                                265,000
Balance at March 31, 2003    20,788,122 $207,882  $10,178,230  $(17,560,137) $ (108,406) $(7,282,431)


 See accompanying auditors' report and notes to consolidated financial statements



</TABLE>


                                                                           21

                        OUT-TAKES, INC. AND SUBSIDIARY
                     CONSOLIDATED STATEMENTS OF CASH FLOWS

                                          March 31,    March 31,     March 31,
                                           2003         2002          2001
                                          ---------    ---------     ---------
Cash flows provided by (used for)
 operating activities:
Net income (loss)                      $   (792,074) $(4,835,665) $   17,273
                                          ---------    ----------    ---------
Adjustments to reconcile net
income to net cash provided
by (used for) operating
 activities:
Depreciation and amortization                36,355       36,755      164,952
Loss on sales of fixed assets                     -          600            -
Bad debt                                          -      (20,136)           -

Write-off of goodwill                             -    4,062,321            -
Expense to consultant                             -       27,000            -
Changes in assets and liabilities:
(Increase) decrease in assets
Accounts receivable                               -      152,254      (89,396)
Due from related party                            -            -     (308,616)
Prepaid asset lease                               -            -      (30,604)
Other current assets                         13,633      (13,633)           -
Other assets                                 26,746        3,598            -

Increase (decrease) in liabilities
Bank overdraft                                    -          530            -
Accounts payable and accrued expenses        16,829      (19,249)     620,327
Accrued interest payable                    512,251      515,761     (173,001)
Provision for studio closure                      -            -            -
 Due to related party                             -       41,536      178,500
Deferred revenue                                  -       (6,971)           -
                                          ---------     ---------    --------
Total adjustments                           605,814     4,773,170     362,162
                                          ---------     ---------    --------
Net cash provided (used) by
 operating activities                      (186,260)     (62,495)    (379,435)
                                          ---------    --------      --------
Cash flows provided by
(used for) investing activities:
Purchases of fixed assets                         -     (2,290)             -
Proceeds from sales of fixed assets               -      1,500              -
                                          ---------    --------      --------
Net cash used by investing activities             -     ( 790)              -

                                          ---------    --------      --------

Cash flows provided by
 (used for) financing activities:
Payments to related parties                       -          -       (773,845)
Proceeds from short term debt                     -          -        380,890
Notes and contracts payable                 186,838          -        (11,000)
Principal proceeds from notes payable             -      29,540             -
Payments on capital lease obligation              -     (19,000)            -
                                          ---------    --------      ---------
Net cash provided (used) by
 financing activities                       186,838      10,540      (403,955)
                                          ---------    --------      ---------

Net increase (decrease) in cash                 578    ( 52,745)      (24,520)
Cash, beginning of year                        (530)     52,745        77,265
                                          ---------    --------      ---------
Cash, end of year                      $         48  $        -     $  52,745
                                          =========    ========      =========

      See accompanying report and notes to Consolidated financial statements


                         OUT-TAKES, INC. AND SUBSIDIARY
                     CONSOLIDATED STATEMENTS OF CASH FLOWS

                                          March 31,    March 31,     March 31,
                                          2003         2002          2001
                                          ---------    ---------     ---------
Cash paid for interest expense          $        -    $       -     $    2,516
Cash paid for income taxes              $        -    $       -     $        -

Non Cash Activities:
Asset acquired through capital
 lease obligation                       $        -    $       -     $        -


      See accompanying report and notes to consolidated financial statements



                         OUT-TAKES, INC. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 1  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
                                                                           22

                             Basis of Presentation
                             ---------------------
The accompanying consolidated financial statements include the accounts of Out-
Takes, Inc. (the Company') incorporated under the laws of the state of Delaware
on March 18, 1992 and its wholly owned subsidiary, Los Alamos Energy, LLC
(LAE') formed under the laws of the state of California as a Limited Liability
Company during June 1996. All significant inter-company accounts and
transactions have been eliminated.

The accompanying consolidated financial statements have been prepared in
conformity with accounting principles generally accepted in the United States
of America, which contemplate continuation of the Company as a going concern.
As of March 31, 2003, the Company has a working capital deficit of $3,347,480
and has incurred a substantial loss for the year ended March 31, 2003 totaling
$792,074. The Company has also wound down its operations and is currently
redeveloping its business plan.

In view of the matters described in the preceding paragraph, recoverability of
a major portion of the recorded asset amounts shown in the accompanying
consolidated balance sheet is dependent upon continued operations of the
Company, which, in turn, is dependent upon the Company's ability to continue to
raise capital and generate positive cash flows from operations.  If the Company
is unable to obtain such financing, the Company will be forced to scale back
operations, which could have an adverse effect on the Company's financial
condition and results of operation.  These factors raise substantial doubt
about the Company's ability to continue as a going concern.  The consolidated
financial statements do not include any adjustments relating to the
recoverability and classification of recorded asset amounts or amounts and


classifications of liabilities that might be necessary should the Company be
unable to continue its existence.

Management plans to take, or has taken, the following steps that it believes
will be sufficient to provide the Company with the ability to continue in
existence:

* The Company is seeking additional equity or debt financing.  There can be no
assurances that sufficient financing will be available on terms acceptable to
the Company; and

* The Company is also seeking out leverage able acquisition opportunities that
would be complimentary to its business and that will provide common synergies
for the future.

Management believes that actions presently being taken to revise the Company's
operating and financial requirements provide the opportunity for the Company to
continue as a going concern.


                               Nature of Business
                               ------------------
The Company's principal business activity is the conversion of such natural gas
into electricity, which is then sold to retail providers of consumer
electricity.

                                                                           23
                                Use of Estimates
                                ----------------
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported amounts
of assets and liabilities and disclosure of contingent assets and liabilities
at the date of the financial statements and the reported amounts of revenue and
expenses during the periods presented.  Actual results could differ from those
estimates.


                              Revenue Recognition
                              -------------------
Revenues are recorded when electrical energy is drawn by its customers (retail
energy providers). Provisions for discounts to customers, estimated returns and
allowances, and other adjustments are provided for in the same period the
related revenues are recorded.

                           Cash and cash equivalents
                           -------------------------
The Company classifies all highly liquid debt instruments, readily convertible
to cash and purchased with a maturity of three months or less at date of
purchase, as cash equivalents. The Company had no cash equivalents at March 31,
2003 and 2002.


                              Accounts Receivable
                              -------------------
Accounts receivable are shown net of the allowance for bad debts of $  -0-  and
$21,313  at March 31, 2003 and 2002.


                         Property, Plant and Equipment
                         -----------------------------
Plant and equipment are recorded at cost. Depreciation is provided over the
estimated useful asset lives using the straight-line method over 5-7 years.

The estimated service lives of property, plant and equipment are as follows:

          Automobile                5 years
          Office equipment          7 years
          Computer                  5 years
          Generators                7 years


                                Intangible Asset
                               ------------------
Intangible asset consisted of goodwill relating to the acquisition of LAE.
Goodwill was recognized for the excess of purchase price over the net assets
acquired and was being amortized on a straight-line basis over 40 years. Should
events or circumstances occur subsequent to the acquisition of a business which
bring into question the realizable value or impairment of the related Goodwill,
the Company will evaluate the remaining useful life and balance of Goodwill and
make adjustments, if required.  The Company's principal consideration in
determining impairment includes the strategic benefit to the Company of the
particular assets as measured by undiscounted current and expected future
operating income of that specified groups of assets and expected undiscounted
future cash flows.  As of April 1, 2001, the Company determined an impairment
                                                                           24
of the Goodwill had occurred and has recognized an impairment expense of
$4,062,321 in the accompanying consolidated statement of operations (see note
3).


                            Earnings (loss) per share
                           -------------------------
In accordance with SFAS No. 128, Earnings Per Share,' the basic loss per common
share is computed by dividing net loss available to common stockholders by the
weighted average number of common shares outstanding.  Diluted loss per common
share is computed similarly to basic loss per common share, except that the
denominator is increased to include the number of additional common shares that
would have been outstanding if the potential common shares had been issued and
if the additional common shares were dilutive.  At March 31, 2003, 2002 and
2001, the Company did not have any dilutive common stock equivalents.

                               Long-Lived Assets
                               -----------------
In accordance with SFAS 121 Accounting For The Impairment of Long-Lived Assets
and For Long-Lived Assets to Be Disposed Of,' long-lived assets to be held and
used are analyzed for impairment whenever events or changes in circumstances
indicate that the related carrying amounts may not be recoverable.   The
Company evaluates at each balance sheet date whether events and circumstances
have occurred that indicate possible impairment.   If there are indications of
impairment, the Company uses future undiscounted cash flows of the related
asset or asset grouping over the remaining life in measuring whether the assets
are recoverable.   In the event such cash flows are not expected to be
sufficient to recover the recorded asset values, the assets are written down to
their estimated fair value.   Long-lived assets to be disposed of are reported
at the lower of carrying amount or fair value of the asset less cost to sell.


                                  Income Taxes
                                  ------------
Deferred tax assets and liabilities are recognized for the future tax
consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their respective tax
bases.  Deferred tax assets, including tax loss and credit carryforwards, and
liabilities are measured using enacted tax rates expected to apply to taxable
income in the years in which those temporary differences are expected to be
recovered or settled.  The effect on deferred tax assets and liabilities of a
change in tax rates is recognized in income in the period that includes the
enactment date.  Deferred income tax expense represents the change during the
period in the deferred tax assets and deferred tax liabilities.  The components
of the deferred tax assets and liabilities are individually classified as
current and non-current based on their characteristics.  Realization of the
deferred tax asset is dependent on generating sufficient taxable income in
future years.  Deferred tax assets are reduced by a valuation allowance when,
in the opinion of management, it is more likely than not that some portion or
all of the deferred tax assets will not be realized.

                                                                           25
                            Stock-Based Compensation
                      ------------------------------------
SFAS No. 123, Accounting for Stock-Based Compensation,' encourages, but does
not require, companies to record compensation cost for stock-based employee
compensation plans at fair value.  The Company has chosen to continue to
account for stock-based compensation using the intrinsic value method
prescribed in Accounting Principles Board Opinion No. 25, "Accounting for Stock
Issued to Employees," and related Interpretations.  Accordingly, compensation
cost for stock options is measured as the excess, if any, of the quoted market
price of the Company's stock at the date of the grant over the amount an
employee must pay to acquire the stock.  For stock options issued to non-
employees, the issuance of stock options is accounted for based on the fair
value of the consideration received or the fair value of the equity instruments
issued, whichever is more reliably measurable.  Compensation expense is
recognized in the consolidated financial statements for stock options granted
to non-employees in the period in which the consideration is obtained from the
non-employee.

                      Fair Value of Financial Instruments
                      -----------------------------------
The carrying amount of the Company's accounts receivable, other current assets,
notes payable, accounts payable and accrued expenses, none of which is held for
trading, approximates their estimated fair values due to the short-term
maturities of those financial instruments. The carrying value of long-term debt
approximates fair value as the related interest rate approximates current
market rates.


                              Comprehensive Income
                              --------------------
SFAS No. 130, Reporting Comprehensive Income,' establishes standards for the
reporting and display of comprehensive income and its components in the
financial statements.  As of March 31, 2003 and 2002, the Company has no items
that represent other comprehensive income and, therefore, has not included a
schedule of comprehensive income in the financial statements.


                               Segment Reporting
                               -----------------
Based on the Company's integration and management strategies, the Company
operated in a single business segment.  For the period ended March 31, 2003
and 2002, all revenues have been derived from domestic operations.


                                  Advertising
                                  -----------
The Company expenses advertising costs when incurred.  The Company did not
incur any advertising costs during the years ended March 31, 2003, 2002 and
2001.

                         New Accounting Pronouncements
                         -----------------------------
In July 2001, the FASB issued SFAS No. 141 Business Combinations.'  SFAS No.
141 supersedes Accounting Principles Board (APB') No. 16 and requires that any
business combinations initiated after June 30, 2001 be accounted for as a
purchase, therefore, eliminating the pooling-of-interest method defined in APB
16.  The statement is effective for any business combination initiated after
June 30, 2001, and shall apply to all business combinations accounted for by
the purchase method for which the date of acquisition is July 1, 2001 or later.
                                                                           26
The adoption of this statement will not have a material impact to the Company's
financial position or results of operations since the Company has not
participated in such activities covered under this pronouncement.

In July 2001, the FASB issued SFAS No. 142, Goodwill and Other Intangibles.'
SFAS No. 142 addresses the initial recognition, measurement and amortization of
intangible assets acquired individually or with a group of other assets (but
not those acquired in a business combination), and addresses the amortization
provisions for excess cost over fair value of net assets acquired or
intangibles acquired in a business combination.  The statement is effective for
fiscal years beginning after December 15, 2001, and is effective July 1, 2001
for any intangibles acquired in a business combination initiated after June 30,
2001.  The Company does not expect the adoption to have a material impact on
the Company's financial position or results of operations.

In October 2001, the FASB issued SFAS No. 143, Accounting for Asset Retirement
Obligations,' which requires companies to record the fair value of a liability
for asset retirement obligations in the period in which they are incurred.  The
statement applies to a company's legal obligations associated with the
retirement of a tangible long-lived asset that results from the acquisition,
construction, and development or through the normal operation of a long-lived
asset.  When a liability is initially recorded, the company would capitalize
the cost, thereby increasing the carrying amount of the related asset.  The
capitalized asset retirement cost is depreciated over the life of the
respective asset while the liability is accreted to its present value.  Upon
settlement of the liability, the obligation is settled at its recorded amount
or the company incurs a gain or loss.  The statement is effective for fiscal
years beginning after June 30, 2002.  The Company does not expect the adoption
to have a material impact to the Company's financial position or results of
operations.

In October 2001, the FASB issued SFAS No. 144, Accounting for the Impairment or
Disposal of Long-Lived Assets.'  Statement 144 addresses the accounting and
reporting for the impairment or disposal of long-lived assets.  The statement
provides a single accounting model for long-lived assets to be disposed of.
New criteria must be met to classify the asset as an asset held-for-sale.  This
statement also focuses on reporting the effects of a disposal of a segment of a
business.  This statement is effective for fiscal years beginning after
December 15, 2001.  The Company does not expect the adoption to have a material
impact to the Company's financial position or results of operations.


                               Reclassifications
                               -----------------
Certain amounts reported in previous years have been reclassified to conform to
the March 31, 2002 presentation.


NOTE 2  PROPERTY AND EQUIPMENT
                                                                           27
A summary of property and equipment are as follows:

                                       March 31, 2003     March 31, 2002
                                     ----------------   ---------------
Computers and software                $        5,589      $     5,589
Equipment and furniture                      371,923          371,923
                                       --------------       -------------
                                             377,512          377,512
Less: Accumulated depreciation              (266,720)        (230,365)
                                         -------------       -------------
                                      $      110,792      $   147,147
                                        =============        =============

Depreciation expense for property and equipment amounted to $36,355, $36,755,
and $56,382 respectively, for the years ended March 31, 2003, 2002 and 2001.

NOTE 3  INTANGIBLE ASSET

Intangible asset consisted of the goodwill recognized relating to the excess of
purchase price over the fair value of the net assets acquired of LAE on August
31, 1998.  Goodwill was being amortized on a straight-line basis over 40 years.

Should events or circumstances occur subsequent to the acquisition of a
business which bring into question the realizable value or impairment of the
related Goodwill, the Company will evaluate the remaining useful life and
balance of Goodwill and make adjustments, if required.  The Company's principal
consideration in determining impairment includes the strategic benefit to the
Company of the particular assets as measured by undiscounted current and
expected future operating income of that specified groups of assets and
expected undiscounted future cash flows.  As of April 1, 2001, the Company
determined an impairment of the Goodwill had occurred and has recognized an
impairment expense of $4,062,321 in the accompanying consolidated statement of
operations.

A summary of intangible assets is as follows:

                                    March 31, 2003        March 31, 2002
                                    --------------        --------------
 Goodwill                           $          -           $ 4,342,784
 Accumulated amortization                      -              (280,553)
                                    --------------        --------------
                                               -             4,062,321
Impairment expense                             -                     -
                                    --------------        --------------
 Net Goodwill                       $           -          $ 4,062,321
                                    ==============        ==============
Amortization expense                $           -          $   108,570
                                    ==============        ==============


NOTE 4  RELATED PARTY TRANSACTIONS

The Company has related party transactions with its director and other related
parties.  The following summarizes these related party transactions:

The Company incurred and paid management fees totaling $150,000 and $105,000,
respectively, to a related party for the years ended March 31, 2002 and 2001,
respectively.
                                                                           28
As of March 31, 2002 and 2001, the Company has accrued payables to a related
party totaling $220,521 and $178,985, respectively, for unpaid advances and
operator fees.

The Company has a month to month lease with its director totaling $750 per
month for office space.


NOTE 5  NOTES PAYABLE

A summary of outstanding notes payable is as follows:

                                         March 31, 2003     March 31, 2002
                                        --------------     --------------
a.     Note Payable-Consultant           $    75,000        $    75,000
b.     Note Payable-Radovich                  30,557             30,557
c.     Notes Payable-Reeves                   75,000             40,000
d.     Note Payable-Boyd                     100,000             50,000
e.     Note Payable-Atlas                     72,984             72,983
f.     Note Payable-Coastal Resources        290,000            219,036
g.     Note Payable-Working Interest         226,889            250,279
h.     Note Payable-Hall                      58,264              4,000
i.     Note Payable-Gormley                   50,000             50,000
j.     Notes Payable-Bower                    45,000            310,000
k.     Note Payable-PCW Holdings             150,000            150,000
                                           ---------          ---------
                                         $ 1,173,694        $ 1,251,855
                                           =========          =========

a.     Note Payable - Consultant
       -------------------------
This is an unsecured note payable to a former financial consultant of the
Company pursuant to a settlement agreement dated August 17, 1994.  The note is
non-interest bearing and payment is subject to availability of future cash
flows from the Company's operations.  During the year ended March 31, 2002,
this note holder filed a lawsuit against the Company.  On March 11, 2002, the
Court ordered the Company to increase the note amount to $75,000 from $48,000
as of March 31, 2002 and the Company recorded the increase in general and
administrative expenses.  As of March 31, 2003, the outstanding balance
was $75,000.

b.     Note Payable - Radovich
       -----------------------
This is an unsecured promissory note that originated on September 27, 1996.
The note's original maturity date was October 27, 1996 and bears no interest.
The note is currently in default and is due on demand.  As of March 31, 2003,
the outstanding balance was $30,557.

c.     Note Payable - Reeves
       ---------------------
This is an unsecured promissory note that originated on March 30, 1998.  The
note's original maturity date was May 30, 1998 and bears interest at the rate
of 10% per annum. The note was convertible into shares of the Company's common
stock at a rate to be negotiated between the parties before the maturity.  The
note is currently in default and due on demand.  As of March 31, 2003 ,
the outstanding balance was $75,000.



                                                                           29
On December 10, 2001, the Reeves advanced the Company an additional $15,000,
due upon demand, bearing no interest.  As of March 31, 2003, the outstanding
balance of this advance was $75,000.

d.     Note Payable -  Boyd
       -------------------
This is an unsecured promissory note that originated on August 13, 1998.  This
note matured on February 13, 1999 and bears interest rate at the rate of 10%
per annum.  As of March 31, 2003, this note was in default and totaled
$45,000.

e.     Note Payable - Atlas Engineering
       --------------------------------
This is an unsecured promissory note that originated on September 15, 2000.
Monthly payments of $8,249 were due commencing October 2000.  The note bears
interest at the rate of 10% per annum.  The Company did not remit any payments
relating to this note.  Therefore, the note is currently in default and payable
on demand.  As of March 31, 2003, the outstanding balances amounted to
$72,984.

f.     Note Payable - Coastal Resources Corp.
       --------------------------------------
This note was originated on June 15, 1999 and was secured by tangible and
intangible assets of the Company.  The note bears interest at the rate of 10%
per annum.  The master loan agreement specified a $300,000 maximum financing
amount and was entered into pursuant to a non-binding merger agreement between
the parties. If the merger was consummated, then the loan balance at that date
would have been credited to Coastal Resources Corp. as part of its
proportionate equity interest in the Company.  If the merger was not
consummated, then the principal balance and interest was due and payable on the
first anniversary date of each advance ranging from June 2000 through August
2000. The Company did not execute the merger agreement with this party and was
not able to make the repayments.  The note, therefore became due on demand and
is currently in due.  As of March 31, 2003, the outstanding balance
amounted to $290,000.


g.     Note Payable - Joint Venture Working Interest
       ---------------------------------------------
These notes are pursuant to a Joint Venture Agreement executed between LAE and
the participants in development and generation of electricity from waste
natural gas activities.  The agreement specified that the participants may be
required to convert their working interest into an equity position when the
Company merges with a publicly traded entity.  Those participants electing not
to convert would be repaid their original consideration plus a non-compounded
annual yield of 12%.  As of March 31, 2003, the outstanding balance
amounted to $226,889.


h.     Note Payable - Hall
       -------------------
This is an unsecured promissory note that originated on January 4, 2000.  The
note's maturity date was January 4, 2001 and bears no interest.  The Company
was unable to repay this note as it became due and it is currently in default
and due on demand.  As of March 31, 2003, the outstanding balance amounted to
$58,264.                                                                    30

i.     Note Payable - Gormley
       ---------------------
This is unsecured promissory note that originated on March 30, 2001.  The note
matured on September 29, 2001 and bears interest at the rate of 10% per annum.
The Company was unable to repay this note as it became due and it is currently
in default and due on demand.  As of March 31, 2003, the outstanding
balance amounted to $50,000.

j.     Notes Payable - Bower
       --------------------
These are secured promissory notes that originated during the period from
November 2000 through February 2001.  Certain of these notes are subordinated
notes are secured by certain tangible and intangible assets of the Company, and
junior in rank to senior and other certain indebtedness  and are subrogated and
These notes bear interest at a rate between 10% and 12%.  The Company was
unable to repay these notes as they became due and are currently in default and
due on demand.  As of March 31, 2002, the outstanding balance amounted
to $310,000.  During the year 2003, part of the note ($265,000) was converted
to equity.  As of March 31, 2003, the outstanding balance was $45,000.

k.     Note Payable - PCW Holdings
       ---------------------------
These are unsecured promissory notes that originated on March 31, 2001.  The
note matured on September 30, 2001 and beared interest at the rate of 10% per
annum.  The Company was unable to repay this note as it became due and it is
currently in default and due on demand.  As of March 31, 2003, the
outstanding balance amounted to $150,000.

NOTE 6 - LONG-TERM DEBT
This note, dated August 31, 1998, is pursuant to a share Purchase Agreement
executed between the former members' of LAE and Out-Takes, Inc.  The note bears
interest at the rate of 10% per annum and matures on August 31, 2003.  This
note is convertible into an aggregate of ninety percent of the issued and
outstanding shares of common stock of Out-Takes, Inc. as of the date of
conversion.  The agreement also requires as a condition of the conversion that
Out-Takes, Inc. effect a reverse stock split of one share for every one-hundred
issued and outstanding shares at the conversion date.  As of March 31, 2003,
this conversion and reverse stock split has not been completed and the
balance of the note amounted to $4,000,000.


A summary of long-term debt maturities follows:

                              Year ended March 31,
                              --------------------
          2003                             -
          2004                     4,000,000
                                   ---------
                                   4,000,000
                                   =========



                                                                           31
NOTE 7  COMMITMENTS AND CONTINGENCIES

                                  Office lease
                               -----------------
The Company's office lease agreement was terminated during May 2002.  Rent
expense totaled $10,200 for the years ended March 31, 2002 and 2001.

                                 Capital lease
                               -----------------
The Company was the lessee of a transformer under a lease agreement expiring
July 2003.  The Company paid off this lease early during the year ended March
31, 2002.  As of March 31, 2003, the cost of equipment held under
capital lease was $0.

                             Asset lease assignment
                          ---------------------------
The Company held an asset lease agreement that generated annual income for the
Company. On March 30, 2001, the Company assigned this asset lease agreement in
lieu of cash to pay down a note payable, including accrued interest.  In
addition, the Company entered into a $150,000 promissory note, dated March 31,
2001 (See note 5k).

                            Environmental Disclosure
                        -------------------------------
The Company's facilities are subject to federal, state and local provisions
relating to the discharge of materials into the environment.  Compliance with
these provisions has not had, nor does the Company expect such compliance to
have, any material effect on the capital expenditures, revenues or expenses, or
financial condition of the Company.  Management believes that its current
practices and procedures for the control and disposition of materials comply
with all applicable federal, state and local requirements.

LAE participates in certain agreements with respect to the generation of
electricity from waste natural gas whereby its managing member also acts as the
operator of the electrical power plant's development and production activities.
As its managing member and operator, LAE is contingently liable for the
activities of this venture.


                          Letter of intent termination
                  --------------------------------------------
In November 2000, the Company entered into a letter of intent with Atlas Power,
Inc. (Atlas') to exchange its shares for Atlas's shares.  During the year ended
March 31, 2002, the letter of intent was terminated.

NOTE 8 - INCOME TAXES

The components of the provision for income taxes are as follows:

                                    For The Years March  31,
                                                 2003       2002
                                               -------    --------
                         Current Tax Expense
                              U.S. Federal     $    -     $      -
                              State and Local       -            -
                         Total Current              -            -
                         Deferred Tax Expense
                                                                           32
                             U.S. Federal           -            -
                              State and Local       -            -
                         Total Deferred             -            -

                         Total Tax Provision
                         (Benefit) Continuing
                          Operations           $    -     $      -

The reconciliation of the effective income tax rate to the Federal statutory
rate is as follows for the years ended March 31, 2002 and 2001:

                         Federal Income Tax Rate          (34.0)%
                         Effect of Valuation Allowance     34.0 %
                         Effective Income Tax Rate          0.0 %

At March 31, 2003 and 2002, the Company had net carryforward losses of
approximately $6,379,823 and $6,100,000, respectively given effect to its
reverse merger with LAE.  Because of the current uncertainty of realizing the
benefit of the tax carryforwards, a valuation allowance equal to the tax
benefit for deferred taxes has been established.  The full realization of the
tax benefit associated with the carryforwards depends predominantly upon the
Company's ability to generate taxable income during the carryforward period.

Deferred tax assets and liabilities reflect the net tax effect of temporary
differences between the carrying amount of assets and liabilities for financial
reporting purposes and amounts used for income tax purposes.  Significant
components of the Company's deferred tax assets and liabilities are as follows:


                                                  For The Years March  31,
                                                      2003        2002
                                                    --------    --------
                  Deferred Tax Assets
                       Loss Carryforward            $2,169,040   $2,074.000
                       Less:  Valuation Allowance   (2,169,040)  (2,074,000)
                         Net Deferred Tax Assets             -           -
                                                   ===========    ========

Net operating loss carryforwards expire starting in 2007 through 2021.  Per
year availability is subject to change of ownership limitations under Internal
Revenue Code Section 382.

NOTE 9  CONCENTRATIONS OF CREDIT RISK
Substantially all of the consolidated revenue of the Company was generated from
the lease of it photographic studio to one entity and the sale of electricity
to Pacific Gas and Electric Company (PG&E') and the lease operator until PG&E
filed for bankruptcy in April 2001.  Beginning in May 2001, the Company sold
its energy to the California Independent System Operator through the Automatic
Power Exchange.


ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
                                                                           33
On February 13, 2003, the Company engaged Rogelio G. Castro, Certified Public
Accountant in place and in stead of Stonefield Josephson, Inc., as its
independent accountant.  The former accountant was dismissed by the company in
February, 2003.  The principal accountant's report on the financial statements
for the past year did not contain an adverse opinion or disclaimer of opinion,
nor was it modified as to uncertainty, audit scope, or accounting principles.
The decision to change accountants was approved by the board of directors of
the company. There were no disagreements with the former accountant, whether or
not resolved, on any matter of accounting principles or practices, financial
statement disclosures, or auditing scope or procedure which, if not resolved to
the former accountant's satisfaction, would have caused it to make reference to
the subject matter of the disagreements in connection with its report.

ITEM 8A.  CONTROLS AND PROCEDURES
As required by Rule 13a-15 under the Exchange Act, within the 90 days prior to
the filing date of this report, our Company carried out an evaluation of the
effectiveness of the design and operation of our Company's disclosure controls
and procedures. This evaluation was carried out under the supervision and with
the
participation of our Company's management, including our Company's President,
Chief Executive Officer and Chief Financial Officer. Based upon that
evaluation, our Company's President, Chief Executive Officer and Chief
Financial Officer concluded that our Company's disclosure controls and
procedures are effective.

There have been no significant changes in our Company's internal controls or in
other factors, which could significantly affect internal controls subsequent to
the date our Company carried out its evaluation.

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

                                  PART III

ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
          COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT


      Name                        Age                       Position
----------------                  ---              ------------------------
Lance Hall                        45               Chief Executive Officer,
                                                   CFO, Secretary, Director

David Gray                        45               Director


                                                                           34
Lance Hall.  Lance Hall is presently a self employed consultant, venture
capitalist and real estate developer, managing mixed use real estate
portfolios, partnerships and syndications, from 1986 to the present time. Since
May, 2003, he has been a founding investor and major shareholder of Los Alamos
Energy, LLC, since 1995. Since 1999 he has served as consultant and financial
advisor to Electric Image, Inc., in Santa Ana, California. From 1987 to the
present, he has acted as consultant and financial advisor to International Food
Products, a developer and distributor of snack and food products. From 1990
through 1995, Mr. Hall was the President and Chief Executive Officer of
American Showcase Homes in Laguna Beach, California, and producer for On-Stage
Entertainment, inc. and Legends In Concert, Inc., Law Vegas, Nevada. He hold
B.S. in Business (Entrepreneur and New Venture Management) from the University
of Southern California, 1980.

David Gray. David Gray has been the president of Bosphorous Partners, LLC, a
company which handles futures and options trading and project funding, since
1999.  From 1998 through 1999, he acted as the Department Head of International
Capital Markets. From 1996 through 1998, he was First Vice President of
Investments of Prudential Securities in Vero Beach, Florida. From 1994 through
1996 he acted as First Vice President of Investments of Paine Webber, in Vero
Beach, Florida. From 1989 through 1994 he was Vice President of Investments of
Prudential Securities in Vero Beach, Florida. From 1986 through 1989, he acted
as Vice President of Investments of Shearson Lehman Bros. in Atlanta, Georgia.
From 1980 through 1986, he served as Vice President, Commodities of Clayton
Brokerage Co., in Atlanta, Georgia. Mr. Gray holds a B.S. Finance from the
Southern Illinois University, and an M.S. Business Administration from Stetson
University, Deland, Florida.


ITEM 10. EXECUTIVE COMPENSATION

No executive salaries were paid to officers or directors in the last fiscal
year. There were no grants of options or SAR grants given to any executive
officers during the last fiscal year. The director of the Company, James
Harvey, is reimbursed $750 per month for rent of the Company's offices and
monthly for the Company's telephone expenses.

Mr. Harvey does not receive compensation for his services.


ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth certain information regarding the beneficial
ownership of the shares of Common Stock of the Company as of the date of this
disclosure(1), by (I) each person who is known by the Company to be the
,beneficial owner of more than five percent (5%) of the issued and outstanding
shares of common stock, (ii) each of the Company's directors and executive
officers, and (iii) all directors and executive officers as a group.

Name and Address                Number of Shares          Percentage Owned
- ----------------                ----------------          ----------------
Lance Hall                         0                        0%*
1933 Upper Rim Rock Canyon
Laguna Beach, CA 92651
                                                                           35
David Gray                         0                        0%
25 S. E. 2nd Avenue, Ste. 1240
Miami, FL 33131

Photo Corporation Group Pty Ltd.   15,295,000               73.57%
P.O. Box 415
Chester Hill, N.S.W.
Australia 2162

All Officers and Directors         0                        0%*
as a Group

--------------------
*No officers and directors hold any stock in the Company.  However, the
acquisition agreement providing for the acquisition of Los Alamos Energy
provides that, in the event the Equity Holders shall desire to do so, they may
convert their indebtedness to common stock of the Company representing in the
aggregate ninety percent (90%) of the issued and outstanding shares of such
common stock as of the date of such conversion. The Acquisition Agreement
provides that it is a condition of the conversion that the Company effect a
reverse stock split of one (1) share for every one hundred (100) shares issued
and outstanding as of such date. LAE contemplates that few, if any, of the
persons currently holding promissory notes and/or working interests in its
electricity production (collectively, "Interest Holders") will exercise their
rights to convert such interests into the equity of LAE, and subsequently to
join in the conversion of the Notes into common stock of the Company.  Lance
Hall
is an equity holder in Los Alamos Energy, holding 65% of the equity of that
entity, and has the right to convert 65% of the note into common stock of the
company, and, thus, be in the position to control the board of directors.


ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The Company rents offices from its President and shareholder, James C. Harvey,
on a month to month basis at a monthly rental of $750 per month. The Company's
acquisition agreement to acquire Los Alamos Energy gives Mr. Harvey and other
members of LAE the right to convert the debt the Company owes under the
acquisition agreement to Company common stock, which means that, if the members
of LAE decided to convert the debt owed them to common stock, they would become
the owners of 90% of the outstanding common stock of the Company.

There have been no other transactions since the beginning of the fiscal year,
or any current transactions, or series of similar transactions, to which the
Company was or is to be a party, in which the amount involved exceeds $60,000,
and in which any of the officers, or directors, or holders of over 5% of the
Company's stock have or will have any direct or indirect material interest. The
Company does not currently have any policy toward entering into any future
transactions with related parties.


                                   PART IV

ITEM 13.   EXHIBITS AND REPORTS ON FORM 8-K

(a)  The  following  exhibits  are filed as part of this  report as required by
     Item 601 of Regulation S-B:
                                                                           36
     3.1   Certificate of Incorporation of the Company. (ii)

     3.2   Certificate of Amendment of Certificate of Incorporation. (ix)

     3.3   Bylaws of the Company. (I)

     4.1   Form of Unit Purchase Option. (I)

     4.2   Form of Warrant Agreement. (I)

     4.3   Form of Escrow Agreement. (iv)

     4.4   Section 203 of the Delaware General Corporation Law. (ix)

     10.1  Form of Registration Rights Agreement. (I)

     10.5  Form of Standard Employment Agreement for hourly wage employee. (vi)

     10.6  Form of  Standard Employment  Agreement for hourly  wage
           employee eligible to earn commissions. (vi)

     10.7  Form of Standard Employment Agreement for salaried employee. (vi)

     10.8  Form of Standard Employment Agreement for salaried employee
           eligible to earn commissions. (vi)


     10.9  Form of Standard Employment Agreement for salaried employee
           eligible for bonus in the form of incentive compensation. (vi)

     10.10 Agreement dated March 16, 1992 between the Placement Agent and
           Shelton on behalf of "Founders" specified therein, as amended. (I) +

     10.11 Founders Agreement dated March 25, 1992 among Robert H. Shelton
          ("Shelton"), Ellen Korval ("Korval"), Robert A. Small ("Small"),
           Leah R. Shelton ("Shelton")and John L. Sigalos ("Sigalos"), as
           supplemented by letter agreement dated as of March 25, 1992 among
           Shelton, Shelton, Sigalos, Korval and Small. (I) +

     10.12 Merchandising License  Agreement  dated  February  25, 1992
           between MCA/Universal Merchandising, Inc. and the Company. (I)

     10.13 Merchandising  License Agreement dated April 24, 1992 between
           Turner Home Entertainment, Inc. and the Company. (I)

     10.14 Merchandising License Agreement dated as of April 16, 1992
           between Paramount Pictures Corporation and the Company. (I)

     10.15 Letter Agreement between the Image Bank West and the Company
           dated as of August 5, 1992. (I)

     10.16 Letter Agreement between the Company and Tony Stone Worldwide
           dated as of August 31, 1992. (I)

     10.17 1992 Employee Stock Option Plan. (iii) +
                                                                           37
     10.18 1992 Non-Employee Directors Stock Option Plan. (iii)

     10.19 Metrum  Imaging  Products VAR  Agreement  dated  September  11,
           1992 between Metrum Information Storage and the Company. (I)

     10.20 Lease dated November 13, 1992 between the Company and MCA
           Development Company. (ii)

     10.21 Lease  dated   October  13,  1992  between  the  Company  and
           Midis Properties, Ltd. (ii)

     10.22 Lease dated March 28, 1993 between the Company and Midis
           Properties, Ltd. (vi)

     10.23 Letter Agreement  between the Company and Jay P. Morgan
           Photography dated September 28, 1992. (iii)

     10.24 Settlement  Agreement and Mutual Release dated as of August 11,
           1994 between the Company,  on the one hand, and Richard T.
           Eckhouse, B&E Financial Express,  Business & Executives Financial
           Group, Innovative Business  Management Inc., and R. T. Eckhouse &
           Assoc., on the other hand. (vii)

     10.25 Promissory  Note in favor  of Photo  Corporation  of  Australia
           Pty Limited, dated March 23, 1995. (viii)

     10.26 Security  Agreement  between the Company  and Photo  Corporation
           of Australia Pty Limited, dated as of March 23, 1995. (viii)

     10.27 Subscription  Agreement between the Company and Oakrusk Pty
           Limited, dated May 26, 1995. (viii)

     10.28 Stock Option Agreement  between the Company and Oakrusk Pty
           Limited, dated May 26, 1995. (viii)

     10.29 Form of Subscription Agreement. (ix)

     10.30 Settlement  and  Mutual  Release   Agreement  between  the
           Company, Shelton,  Shelton and Photo  Corporation  Group Pty
           Limited, dated August 31, 1996. (x)

    10.31  Purchase and Sale Agreement between the Company and Los Alamos
           Energy, LLC, Dated August 31, 1998

    10.32  Asset Lease Agreement dated October 26, 1998

(b)  Reports on Form 8-K

     Current Report on Form  8-K dated April 27, 1998.

     Current Report on Form  8-K dated May 13, 1998

     Current Report on Form  8-K dated October 28, 1998

     Current Report on Form 8-K dated November 13, 1998

     Current Report on Form 8-K dated December 15, 2000
                                                                           38
     Current Report on Form 8-K dated January 1, 2003

     Current Report on Form 8-K dated April 6, 2001

     Current Report on Form 8-K dated August 14, 2002, as amended August 28

     Current Report on Form 8-K dated February 2, 2003, as amended March 13

     Current Report on Form 8-K dated August 1, 2003

     (I)  Incorporated by reference to the Company's  Registration
          Statement on Form  S_1   (Registration   No.  33_  52904)  filed
          on October 5, 1992 (the "Registration Statement").

     (ii)  Incorporated  by reference to  Pre-Effective  Amendment  No. 1 to
           the Registration Statement filed on December 21, 1992.

     (iii) Incorporated  by reference to  Pre-Effective  Amendment No. 2 to
           the Registration Statement filed on January 15, 1993.

     (iv)  Incorporated  by reference to  Pre-Effective  Amendment  No. 3 to
           the Registration Statement filed on February 3, 1993.

     (v)   Incorporated by reference to the Company's  Registration
           Statement on Form 8_A (No. 0_21322) filed on March 5, 1993 and
           effective on March 19, 1993.

     (vi)  Incorporated  by reference  to the  Company's  Annual  Report on
           Form 10-KSB for the fiscal year ended March 31, 1993.

     (vii) Incorporated by reference to the Company's Quarterly Report on
           Form 10_QSB for the quarterly period ended June 30, 1994.

    (viii) Incorporated  by reference to the  Company's  Annual Report on
           Form 10-KSB for the fiscal year ended March 31, 1995.

     (ix)  Incorporated  by reference  to the  Company's  Annual  Report on
           Form 10-KSB for the fiscal year ended March 31, 1995.

     (x)  Incorporated by reference to the Company's Report on Form 10_QA for
          the period ended September 30, 1996.

Management contract or compensatory plan.


                                   SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.

                                  Out-Takes, Inc.

Dated: August 14, 2003            By: Lance Hall
                                                                           31
                                  -------------------------------------
                                      Lance Hall, Chief Executive Officer,
                                                 President


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


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

       Lance Hall          Chairman of the Board, President,   August 14, 2003
       -----------------   Chief Executive Officer, Chief
       Lance Hall          Financial Officer and Secretary, and director



                                                                           32

                                 CERTIFICATION
                            PURSUANT TO SECTION 302
                        OF THE SARBANES-OXLEY ACT OF 2002

I, Lance Hall, certify that:

1. I have reviewed this report on Form 10-K of Out Takes, Inc.

2. Based on my knowledge, this 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 this report;

3. Based on my knowledge, the financial statements, consolidated financial
statements and other financial information included in this report, fairly
present in all material respects the financial condition, results of
operations and cash flows of the registrant as of, and for, the periods
presented
in this report;

4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including any subsidiaries, is made
known to us by others within those entities, particularly during the period in
which this report is being prepared;

b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
report (the "Evaluation Date"); and

c) presented in this report our conclusions about the effectiveness of the
disclosure controls and procedures based on our evaluation as of the
Evaluation Date;
                                                                           33
5. The registrant's other certifying officers and I have disclosed, based on
our most recent evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors (or persons performing the
equivalent function):

a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process,
summarize and report financial data and have identified for the registrant'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 registrant's internal controls;
and

6. The registrant's other certifying officers and I have indicated in this
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 our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.

Date: August 14, 2003


Lance Hall
------------------------
Lance Hall
Chief Executive Officer
Chief Financial Officer






                                                                           34