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

FORM 10-QSB
Annual Report Under Section 13 Or 15(d) Of The Securities Exchange Act Of 1934

For the quarterly period ended September 30, 2003
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|                         | CityXpress Corp    |                              
|------------------------ | ------------------ | -----------------------------
|                         | (Name of business) |                              
|Florida                  |                    | 98-0232838                   
|(State of incorporation) |                    | (IRS Employer Identification)

|Suite 200-1727 West Broadway Vancouver, BC Canada V6J 4W6               
|------------------------------------------------------------------------
|(Address of principal executive offices)                                
|                                                                        
|Issuer's Telephone Number 604-638-3811  Issuer's Fax Number 604-638-3808
|                                                                        
|Securities registered under Section 12(g) of the Exchange Act:          
|Common Shares, Par Value of $0.001 per Share                            
|(Title of Class)                                                        
|                                                                        
|Name of each exchange on which registered:                              
|NASD OTC BULLETIN BOARD                                                 

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

Yes [X]   No [_]



State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: November 1, 2003: 24,520,033common shares.



Transitional Small Business Disclosure Format (check one) Yes [X]   No [_]





TABLE OF CONTENTS

|PART I  |                                                                                                                        | 4 
|------- | ---------------------------------------------------------------------------------------------------------------------- | --
|ITEM 1. | FINANCIAL STATEMENTS (Unaudited)                                                                                       |   
|        | CONSOLIDATED BALANCE SHEETS: September 30, 2003 and June 30, 2003                                                      | 5 
|        | CONSOLIDATED STATEMENTS OF OPERATIONS: Three months ended September 30, 2003 and 2002                                  | 7 
|        | CONSOLIDATED STATEMENT OF STOCKHOLDERS' DEFICIENCY: Three months ended September 30, 2003 and year ended June 30, 2003 | 8 
|        | CONSOLIDATED STATEMENTS OF CASH FLOWS: Three months ended September 30, 2003 and 2002                                  | 11
|        | NOTES TO CONSOLIDATED FINANCIAL STATEMENTS:
September 30, 2003                                                         | 13
|ITEM 2. | MANAGEMENT DISCUSSION AND ANALYSIS                                                                                     | 21
|ITEM 3. | CONTROLS AND PROCEDURES                                                                                                | 27
|        |                                                                                                                        |   
|PART II |                                                                                                                        | 27
|ITEM 1. | LEGAL PROCEEDINGS                                                                                                      | 27
|ITEM 2. | CHANGES IN SECURITIES AND USE OF PROCEEDS                                                                              | 27
|ITEM 3. | DEFAULTS UPON SENIOR SECURITIES                                                                                        | 27
|ITEM 4. | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS                                                                    | 27
|ITEM 5. | OTHER INFORMATION                                                                                                      | 27
|ITEM 6. | EXHIBITS AND REPORTS ON FORM 8-K                                                                                       | 28



PART 1

NOTE REGARDING FORWARD LOOKING STATEMENTS

Except for statements of historical fact, certain information contained in this quarterly report includes "forward-looking statements," including without limitation statements containing the words "believes," "anticipates," "intends," "expects" and words of similar import, as well as all projections of future results.

Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results or achievements of the Company to be materially different from any future results or achievements of the Company expressed or implied by such forward-looking statements. Such factors include, but are not limited to the following: under capitalization; unpredictability of future revenues; competition; risks of technological change; the Company's dependence on key personnel; dependence on continued growth in use of the Internet; the Company's ability to protect its intellectual property rights and uncertainty regarding infringing intellectual property rights of others; government regulations; and the other risks and uncertainties described in this quarterly report.

Part I-Financial Information

Item 1. First Quarter Financial Statementsending September 30, 2003

Consolidated unaudited interim financial statements of the Company for the three months period ended September 30, 2003 and September 30, 2002. All figures are presented in U.S. Currency, unless otherwise stated.



CONSOLIDATED BALANCE SHEETS

[See Nature of Operations and Basis of Presentation : Note 1] (Expressed in U.S. dollars)

|                                                                                                                         | September 30 | June 30     
|------------------------------------------------------------------------------------------------------------------------ | ------------ | ------------
|                                                                                                                         | 2003         | 2003        
|                                                                                                                         | (Unaudited)  |             
|                                                                                                                         | $            | $           
|ASSETS                                                                                                                   |              |             
|Current                                                                                                                  |              |             
|Cash and cash equivalents                                                                                                | N/A          | 12,308      
|Accounts receivable, net of allowance for doubtful accounts of $nil in September 30, 2003 and June 30, 2003              | 172,995      | 94,169      
|Other receivables                                                                                                        | 11,595       | 7,132       
|Prepaid expenses                                                                                                         | 20,938       | 26,603      
|Total current assets                                                                                                     | 205,528      | 140,212     
|Property and equipment, net                                                                                              | 111,137      | 124,465     
|Product development costs                                                                                                | 185,132      | 171,579     
|Intangible assets                                                                                                        | 47,247       | 53,492      
|Total assets                                                                                                             | 549,043      | 489,748     
|                                                                                                                         |              |             
|LIABILITIES AND STOCKHOLDERS' DEFICIENCY                                                                                 |              |             
|Current                                                                                                                  |              |             
|Bank indebtedness                                                                                                        | 3,674        | N/A         
|Accounts payable                                                                                                         | 308,191      | 291,423     
|Accrued liabilities                                                                                                      | 437,143      | 421,423     
|Deferred revenue                                                                                                         | 295,135      | 250,763     
|Revolving loan [note 3]                                                                                                  | 121,459      | 66,790      
|Current portion of loans payable                                                                                         | 350,000      | 350,000     
|Convertible loan debentures [note 4]                                                                                     | 3,500,000    | 3,000,000   
|Stockholders' loans [note 5]                                                                                             | 669,230      | 611,942     
|Current portion of obligations under capital leases                                                                      | 68,368       | 70,812      
|Total current liabilities                                                                                                | 5,753,200    | 5,753,200   
|Obligations under capital leases                                                                                         | 39,589       | 47,773      
|Total liabilities                                                                                                        | 5,792,789    | 5,410,926   
|                                                                                                                         |              |             
|Stockholders' deficiency                                                                                                 |              |             
|Share capital [note 6]
Common stock - $0.001 par value
Authorized shares: 100,000,000
Issued and outstanding: 24,520,033 | 24,520       | 24,520      
|Common stock to be issued : 198,587                                                                                      | 12,650       | 12,650      
|Additional paid in capital                                                                                               | 5,984,090    | 5,984,090   
|Accumulated other comprehensive income                                                                                   | 19,625       | 19,625      
|Deficit                                                                                                                  | (11,284,631) | (10,962,063)
|Total stockholders' deficiency                                                                                           | (5,243,746)  | (4,921,178) 
|Total liabilities and stockholders' deficiency                                                                           | 549,043      | 489,748     

See accompanying notes.  The accompanying notes are an integral part of the consolidated financial statements.





CONSOLIDATED STATEMENTS OF OPERATIONS

[See Basis of Presentation : Note 1] [Unaudited] (Expressed in U.S. dollars)



|                                                                                               | 3 Months ended September 30 2003 | 3 Months ended
September 30 2002
|---------------------------------------------------------------------------------------------- | -------------------------------- | --------------------------------
|                                                                                               | $                                | $                               
|Revenue                                                                                        |                                  |                                 
|Auction fees                                                                                   | 282,416                          | 64,214                          
|Special Sections                                                                               | 71,460                           | 98,984                          
|Other Fees                                                                                     | 511                              | 0                               
|Total revenues                                                                                 | 354,387                          | 163,198                         
|Cost of sales (including amortization of product development costs of $28,946, 2002 - $16,574) | 268,272                          | 100,581                         
|Gross profit                                                                                   | 86,115                           | 62,617                          
|                                                                                               |                                  |                                 
|Operating expenses                                                                             |                                  |                                 
|Sales and marketing                                                                            | 155,139                          | 111,703                         
|Product development and technology                                                             | 98,064                           | 83,412                          
|Finance and administration                                                                     | 102,093                          | 85,140                          
|Amortization of intangible assets                                                              | 6,245                            | 4,480                           
|                                                                                               | 361,541                          | 284,735                         
|Loss before undernoted                                                                         | (275,426)                        | (222,118)                       
|Other income (expense)                                                                         |                                  |                                 
|Interest expense                                                                               | (44,805)                         | (43,021)                        
|Gain on disposal of fixed assets                                                               | 250                              | 0                               
|Miscellaneous income                                                                           | 17                               | 15                              
|Foreign exchange gain (loss)                                                                   | (2,604)                          | 8,768                           
|Total other expense                                                                            | (47,142)                         | (34,238)                        
|Net loss and comprehensive loss for the period                                                 | (322,568)                        | (256,356)                       
|Net loss per common share [note 6(c)]                                                          |                                  |                                 
|Basic and diluted                                                                              | (0.01)                           | (0.01)                          
|Weighted average number of common shares [note 6(c)]                                           |                                  |                                 
|Basic and diluted                                                                              | 24,520,033                       | 23,533,135                      

See accompanying notes.  The accompanying notes are an integral part of the consolidated financial statements.



CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIENCY

[See Nature of Operations and Basis of Presentation : Note 1] (Expressed in U.S. dollars)



|                                          | Common stock
# | Common stock to be issued
# | Common stock issued and outstanding
$ | Common stock to be issued
$ | Additional paid in capital
$ | Accumulated other comprehensive income
$ | Deficit
$    | Total stockholders' equity (deficit)
$
|----------------------------------------- | -------------- | --------------------------- | ------------------------------------- | --------------------------- | ---------------------------- | ---------------------------------------- | ------------ | --------------------------------------
|Year ended June 30, 2003                  |                |                             |                                       |                             |                              |                                          |              |                                       
|Balance at
June 30, 2002                  | 23,303,898     | N/A                         | 23,304                                | N/A                         | 5,843,305                    | 19,625                                   | (9,837,481)  | (3,951,247)                           
|Acquisition of 10digit Communications     | 1,216,135      | N/A                         | 1,216                                 | N/A                         | 60,141                       | N/A                                      | N/A          | 61,357                                
|Shares to be issued                       | N/A            | 198,587                     | N/A                                   | 12,650                      | N/A                          | N/A                                      | N/A          | 12,650                                
|Stock based compensation                  | N/A            | N/A                         | N/A                                   | N/A                         | 80,644                       | N/A                                      | N/A          | 80,644                                
|Net loss for the year                     | N/A            | N/A                         | N/A                                   | N/A                         | N/A                          | N/A                                      | (1,124,582)  | (1,124,582)                           
|Balance at June 30, 2003                  | 24,520,033     | 198,587                     | 24,520                                | 12,650                      | 5,984,090                    | 19,625                                   | (10,962,063) | (4,921,178)                           
|Net loss for the period                   | N/A            | N/A                         | N/A                                   | N/A                         | N/A                          | N/A                                      | (322,568)    | (322,568)                             
|Balance at September 30, 2003 [unaudited] | 24,520,033     | 198,587                     | 24,520                                | 12,650                      | 5,984,090                    | 19,625                                   | (11,284,631) | (5,243,746)                           

See accompanying notes.  The accompanying notes are an integral part of the consolidated financial statements.



CONSOLIDATED STATEMENTS OF CASH FLOWS

[See Nature of Operations and Basis of Presentation : Note 1] [Unaudited] (Expressed in U.S. dollars)



|Three months ended September 30                                             | 2003      | 2002     
|--------------------------------------------------------------------------- | --------- | ---------
|                                                                            | $         | $        
|OPERATING ACTIVITIES                                                        |           |          
|Net loss for the period                                                     | (322,568) | (256,356)
|Adjustments to reconcile net loss to net cash used in operating activities: |           |          
|Amortization                                                                | 6,245     | 4,480    
|Depreciation                                                                | 57,417    | 36,332   
|Gain on disposal of fixed assets                                            | (250)     | N/A      
|Deferred revenue                                                            | 44,372    | 59,287   
|Changes in operating assets and liabilities:                                |           |          
|Accounts receivable                                                         | (78,826)  | (43,861) 
|Other receivables                                                           | (4,463)   | (4,874)  
|Prepaid expenses and other                                                  | 5,665     | 101      
|Accounts payable                                                            | 16,768    | (17,341) 
|Accrued liabilities                                                         | 15,720    | 22,668   
|                                                                            |           |          
|Net cash used in operating activities                                       | (259,920) | (199,564)
|                                                                            |           |          
|INVESTING ACTIVITIES                                                        |           |          
|10digit Communications acquisition costs                                    | N/A       | (13,585) 
|Purchase of property and equipment                                          | (487)     | N/A      
|Development costs                                                           | (47,887)  | (35,214) 
|Net cash used in investing activities                                       | (48,374)  | (48,799) 
|                                                                            |           |          
|FINANCING ACTIVITIES                                                        |           |          
|Bank indebtedness                                                           | 3,674     | N/A      
|Proceeds from revolving loan                                                | 54,669    | N/A      
|Proceeds from convertible loan debentures                                   | 200,000   | 225,000  
|Repayment of demand instalment loan                                         | N/A       | (1,865)  
|Repayments under capital leases                                             | (19,645)  | (9,755)  
|Proceeds from stockholders' loans                                           | 72,727    | N/A      
|Repayment of stockholders' loans                                            | (16,589)  | (1,043)  
|Net cash provided by financing activities                                   | 294,836   | 212,337  
|Effect of foreign exchange rate changes on cash                             | 1,150     | N/A      
|Net increase (decrease) in cash and cash equivalents during the period      | (12,308)  | (36,026) 
|Cash and cash equivalents, beginning of period                              | 12,308    | 82,974   
|Cash and cash equivalents, end of period                                    | (3,674)   | 46,948   
|Supplemental disclosure                                                     |           |          
|Interest paid                                                               | 15,313    | 10,313   
|Non cash investing and financing transactions:                              |           |          
|Shares issued to acquire 10digit Communications                             | N/A       | 64,096   
|Capital assets acquired through the assumption of capital leases            | 9,017     | 40,171   

See accompanying notes.  The accompanying notes are an integral part of the consolidated financial statements.





1. NATURE OF OPERATIONS AND BASIS OF PRESENTATION

CityXpress Corp. ("Company") is incorporated under the laws of the State of Florida.

The Company has developed a suite of online products that provide newspapers with solutions through which they can defend and extend their position as the dominant means for local advertisers to promote themselves to local consumers. The Company's online special section product integrates niche editorial content with advertising and promotional tools that leverage a newspaper's brand and traffic. The Company's auction product allows newspapers to auction advertising clients' products in exchange for advertising credits with the newspaper, with the newspaper retaining the cash from all products that are sold in the auction. The Company intends to build further alliances with media companies who own newspaper and television stations. The Company currently operates in only one industry segment and its marketing efforts are currently targeted to the North American market.

These unaudited consolidated financial statements are presented in U.S. dollars in accordance with accounting principles generally accepted in the United States of America and have been prepared on the same basis as the annual audited consolidated financial statements. In the opinion of management, these unaudited consolidated financial statements reflect all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation for each of the periods presented.  The results of operations for interim periods are not necessarily indicative of results to be achieved for full fiscal years.

As contemplated by the Securities and Exchange Commission (SEC) under Rule 10-01 of Regulation S-X, the accompanying consolidated financial statements and related footnotes have been condensed and do not contain certain information that will be included in the company's annual consolidated financial statements and footnotes.  For further information, refer to the consolidated financial statements and related footnotes for the years ended June 30, 2003 and 2002 included in the company's Annual Report on Form 10-KSB.

The consolidated financial statements for the three months ended September 30, 2003 have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business for the foreseeable future. The Company incurred a net loss of $322,568 for the three months ended September 30, 2003 and has a working capital deficiency of $5,547,672 and an accumulated deficit of $11,284,631 at September 30, 2003. These factors raise substantial doubt about the Company's ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent upon its ability to achieve profitable operations and to obtain additional capital. Management expects to raise additional capital through private placements and other types of venture fundings and through financing agreements with its clients. Also, management expects to generate higher revenues over the 2004 fiscal year. The outcome of these matters cannot be predicted at this time. No assurances can be given that the Company will be successful in raising sufficient additional capital or increasing revenues. Further, there can be no assurance, assuming the Company successfully raises additional funds or increases revenues, that the Company will achieve positive cash flow. If the Company is unable to obtain adequate additional financing or additional revenues, management will be required to curtail the Company's operating expenses. These consolidated financial statements do not include any adjustments to the specific amounts and classifications of assets and liabilities which might be necessary should the Company be unable to continue in business.

2. RECENT ACCOUNTING PRONOUNCEMENTS

Classification of liabilities

In May 2003, the FASB issued Statement No. 150 (FAS 150), "Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity." FAS 150 establishes standards for how an issuer classifies and measures in its balance sheet certain financial instruments with characteristics of both liabilities and equity.  It requires that an issuer classify a financial instrument that is within its scope a liability (or an asset in some circumstances) because that financial instrument embodies an obligation of the issuer.  This Statement is effective for financial instruments entered into or modified after May 31, 2003, and otherwise is effective at the beginning of the first interim period beginning after June 15, 2003.  Adoption of FAS 150 is not expected to have a material effect on the Company's financial statements.

3. REVOLVING LOAN

On May 1, 2003, the Company entered into a Revolving Loan and General Security Agreement with a company controlled by a director. Under this agreement, the Company has received $164,000 Cdn ($121,459 US) in funding.  The revolving loan carries an interest rate of 10% per annum of the outstanding balance and is payable monthly. The outstanding balance of the loan cannot exceed 90% of the Company's 90 days accounts receivable outstanding balance. Under the General Security Agreement, the Company has pledged its accounts receivable and tangible assets as collateral and security for all loan advances outstanding. Interest for the period ended September 30, 2003 on this loan amounted to $1,927.

4. CONVERTIBLE LOAN DEBENTURES

On November 1, 2000, the Company entered into an Investment Agreement with Lee Enterprises Incorporated ("Lee") whereby Lee provided funding of $1,500,000 in the form of a floating rate subordinated convertible debenture. The $1,500,000 subordinated convertible debenture consists of a series of six debentures of $250,000 that were received by the Company during the year ended June 30, 2001.

The Investment Agreement provides Lee the right to convert the floating rate subordinated convertible debenture into 6,902,429 common shares of the Company at a conversion price of $0.2173 per common share. If Lee does not convert the debenture into common shares, the Company will be required to repay the $1,500,000 loan on October 31, 2003. Each series of $250,000 subordinated convertible debenture bears interest at the Wall Street Journal rate less 1%.

On July 30, 2001, the Company and Lee entered into a First Amendment To Investment Agreement, which amended the Investment Agreement dated November 1, 2000 whereby Lee agreed to provide additional funding of $1,500,000 in the form of floating rate subordinated convertible debentures. The additional $1,500,000 subordinated convertible debentures were in the form of a series of twelve debentures (debentures "G-R") ranging in value from $50,000 to $310,000, which were funded during the period from August 10, 2001 to July 1, 2002. This resulted in a total investment by Lee of $3,000,000.

The first amendment to the Investment Agreement provides Lee the right to convert the second $1,500,000 floating rate subordinated convertible debenture into 8,522,727 common shares of the Company at a conversion price of $0.176. Should Lee convert both investments of $3,000,000 it would result in the Company issuing 15,425,156 common shares. If Lee does not convert the second debenture to common shares the Company will have to repay the $1,500,000 loan on October 31, 2003. Each Series "G-R" subordinated convertible debenture for the second investment of $1,500,000 bears interest at the Wall Street Journal rate less 1%.

In conjunction with the first amendment to the Investment Agreement dated July 30, 2001, the Company also amended the November 30, 2000 Loan and Security Agreement and the Collateral License Agreement and the Registration Rights Agreement to reflect the Series G-R debentures

On August 1, 2002, the Company and Lee entered into a Second Amendment To Investment Agreement, which amended the Investment Agreement dated November 1, 2000 whereby Lee agreed to provide additional funding of $300,000 in the form of floating rate subordinated convertible debentures. The additional $300,000 subordinated convertible debentures were in the form of a series of three debentures (debentures "S, T and U") ranging in value from $75,000 to $125,000, which were funded on August 1, 2002, September 1, 2002 and October 11, 2002 respectively.

The second amendment to the Investment Agreement provides Lee the right to convert the $300,000 floating rate subordinated convertible debenture into 1,704,545 common shares of the Company at a conversion price of $0.176 per common share.

The second amendment to the Investment Agreement also contains certain affirmative and negative

covenants that restrict the Company's activities.  As of June 30, 2003, the Company is in compliance with the covenants in the Investment Agreement as amended.  Interest due on the convertible debentures can be paid or converted into shares of the Company's common stock at fair market value on the date of conversion at the option of Lee.

On July 16, 2003 the Company and Lee entered into a Third Amendment To Investment Agreement, which amended the Investment Agreement dated November 1, 2000 whereby Lee agreed to provide additional funding of $100,000 in the form of floating rate subordinated convertible debenture. The additional $100,000 subordinated convertible debenture was in the form of a series "V" debenture, which was funded on July 16, 2003.

On August 14, 2003 the Company and Lee entered into a Fourth Amendment To Investment Agreement, which amended the Investment Agreement dated November 1, 2000 whereby Lee agreed to provide additional funding of $100,000 in the form of floating rate subordinated convertible debenture. The additional $100,000 subordinated convertible debenture was in the form of a series "W" debenture, which was funded on August 14, 2003. The weighted average effective rate for the three months ended September 30, 2003 on all these debenture series "A-W" was 3.00%. Interest for the three months ended September 30, 2003 on these debentures amounted to $25,964.

5. RELATED PARTY TRANSACTIONS

[a]	Stockholders' loans

In July 2003, the Company's chief executive officer and chief financial officer provided the Company $100,000 Cdn ($72,727 US) in the form of Stockholder loans.

At September 30, 2003 the Company has several unsecured stockholder loans denominated in Canadian dollars outstanding with the Company's chief executive officer and chief financial officer. The stockholders' loans, all of which are without stated terms of repayment unless otherwise stated, are payable on demand.

|Balance Outstanding                                                                                                      
|-------------------------------------------------------------------------------------------------------------------------
|                                                                                                                         
|Loans payable bearing interest at 4.55% and repayable in equal monthly blended instalments of $1,450 through January 2028
|Loans payable bearing interest at 4.55% and repayable in equal monthly blended instalments of $1,468 through January 2028
|Loan payable bearing interest at Toronto Dominion Bank monthly TD Select Line rate                                       
|Loan payable bearing interest at the CIBC Visa monthly interest rate                                                     
|Loan payable bearing interest at 4.5% per annum                                                                          
|Loan payable bearing interest at Canadian Imperial Bank of Canada monthly Line rate                                      
|Loan payable bearing interest at Canadian Imperial Bank of Canada monthly Line rate                                      
|Loan payable bearing interest at Canadian Imperial Bank of Canada monthly Line rate                                      
|Loan payable bearing interest at North Shore Credit Union monthly Line rate                                              
|                                                                                                                         

6. SHARE CAPITAL

[a]	Stock options

Stock option transactions for the quarter ended September 30, 2003 are summarized below:

|                            | Shares       | Outstanding options
|--------------------------- | ------------ | -------------------
|                            | available    |                    
|                            | under option | Shares             
|                            | #            | #                  
|Balance, June 30, 2003      | 1,050,000    | 2,950,000          
|Granted, July 17, 2003      | (25,000)     | 25,000             
|Cancelled                   | 60,000       | (60,000)           
|Balance, September 30, 2003 | 1,085,000    | 2,915,000          

The following table summarizes information about stock options that are outstanding at September 30, 2003:

|               |                                     | Options outstanding         | Options exercisable                
|-------------- | ----------------------------------- | --------------------------- | -----------------------------------
|Exercise
price | Number
outstanding at
June 30, 2003 | Weighted-
average
remaining | Number
outstanding at
June 30, 2003
|$              | #                                   | contractual life            | #                                  
|0.25           | 2,915,000                           | 1.88                        | 1,701,667                          

[b]	Warrants

The following represents a summary of warrants outstanding at September 30, 2003:

|                            | Outstanding warrants
|--------------------------- | --------------------
|                            | Shares              
|Grant Date                  | #                   
|September 30, 1999          | 465,800             
|October 13, 1999            | 132,138             
|December 10, 1999           | 408,000             
|January 18, 2000            | 138,000             
|January 31, 2000            | 500,000             
|May 1, 2000                 | 405,240             
|May 18, 2000                | 280,000             
|June 13, 2000               | 541,600             
|November 10, 2000           | 200,000             
|June 26, 2001               | 160,000             
|March 3, 2003               | 1,310,626           
|June 16, 2003               | 782,187             
|Balance, September 30, 2003 | 5,323,591           

[c]	Loss per common share

The following table sets forth the computation of basic and diluted loss per share:

|                                                     | Three Months Ended September 30 2003 | Three Months Ended September 30 2002
|---------------------------------------------------- | ------------------------------------ | ------------------------------------
|                                                     | $                                    | $                                   
|Net loss for the period                              | (322,568)                            | (256,356)                           
|Net loss attributable to common shareholders         | (322,568)                            | (256,356)                           
|Weighted average number of common shares outstanding | 24,520,033                           | 23,533,135                          
|Basic and diluted loss per common share              | (0.01)                               | (0.01)                              

For the quarters ended September 30, 2003 and 2002, all of the Company's common shares issuable upon the exercise of 2,950,000 (2002 : 2,890,000) stock options and 5,323,591 (2002 : 3,230,778) warrants were excluded from the determination of diluted loss per common share as their effect would be anti-dilutive.

7. COMPARATIVE FIGURES

Certain comparative figures have been reclassified from statements previously presented to conform to the presentation adopted in the current quarter.

8. SUBSEQUENT EVENT

As of November 6, 2003, the Company and Lee Enterprises Incorporated ("Lee") amended the Investment Agreement dated November 1, 2000, as amended, to extend the Optional Redemption Date and the Mandatory Redemption Date to January 9, 2004, and to change the Interest Conversion Rate for converting accrued and unpaid interest on the outstanding Floating Rate Subordinated Convertible Debentures issued by the Company to Lee ("Convertible Debentures"). As revised, Lee may convert all or any portion of the accrued and unpaid interest on the outstanding Convertible Debentures on the basis of one share of the Company's common stock times the quotient of the accrued and unpaid interest to the date of conversion divided by $0.057.

As of November 6, 2003, the Company and Lee amended the Loan and Security Agreement dated as of July 31, 2001, as amended (the "Loan and Security Agreement"), to extend the maturity date to January 9, 2004, and to grant Lee the right to convert all or any portion of the indebtedness owed to Lee under the Loan and Security Agreement into shares of the Company's common stock at any time prior to the maturity date. Subject to adjustment, Lee may convert all or any portion of the outstanding principal on the basis of one share of the Company's common stock for each $0.057 of outstanding principal, and Lee may convert all or any portion of the accrued and unpaid interest on the basis of one share of the Company's common stock times the quotient of the accrued and unpaid interest to the date of conversion divided by $0.057.

Item 2 Management's Discussion and Analysis

General

The Company incurred a loss for the three months ended September 30, 2003 of $322,568 as compared to a loss of $256,356 for the same period in 2002, an increase of $66,212.

The increase in loss for the three months ended September 30, 2003 of $66,212 is the result of increased revenues and net expenses resulting primarily from the following items compared to the same three months ended September 30, 2002:

Summary of Improved Operating Loss:

|Revenue Improvement        | $191,189  
|-------------------------- | ----------
|Cost of Sales Increase     | ($167,691)
|Operating Expense Increase | ($76,806) 

Revenue

The Company recorded revenue of $354,387 in the three months ended September 30, 2003 an increase of $191,189 over the same three months period in 2002. Total revenues have been increasing in a continued upward trend for the last ten quarters. The revenue increases for the three months ended September 30, 2003 resulted primarily from increased auction revenue and training fees for Xpress Auctions. The Company generates online auction revenue when a customer uses our Xpress Auction product to run an online auction in their market. The Company receives a unit fee per auction article and a percentage of total auction revenue received by the newspaper. Training revenue is dependent on the customer's needs and can fluctuate each quarter.

Auction fees increased by $218,202 this quarter compared to the same quarter ended September 30, 2002.

Lee Enterprises Incorporated ("Lee") newspapers accounted for $71,735 of revenue for the quarter ended September 30, 2003 or 20% of total revenue for the quarter, same percentage of total revenue from the comparative quarter, one year ago.

Cost of sales

Cost of sales increased by $167,691 for this quarter compared to the same quarter ended September 30, 2002.   This increase is due primarily to increases in costs to support additional online auction clients as follows:

- Increase in costs of additional online auction trainers hired to service new clients of $75,963.
- New costs of outsourcing auction support services of $16,950 for telephone support services provided to bidders in the online auction.
- Increase in travel costs of $54,075 for XpressAuctionsä
 training trips for new auction clients.
- Increase in amortization costs of $12,372 is primarily related to higher product development costs being amortized this quarter.

Operating expenses

Operating expenses increased by $76,806 for the quarter ended September 30, 2003 compared to the same quarter ended September 30, 2002. The marginal net increase is due primarily to the following:

- Increase in finance and administration expenses of $16,973 this quarter is primarily the result of increases in depreciation expenses of approximately $2,900, a non-cash item and increases in both salaries expenses for finance and administration staff and expenses for employees' health benefits of approximately $9,700.  The increase in depreciation is primarily due to purchases of computer equipment and the depreciation of this equipment during this quarter.

- Increase in sales and marketing expenses of $43,436 this quarter is the result of increases in additional sales staff and consultants hired to service the company's growing list of existing and prospective customers of approximately $18,450, and increase in promotional expenses for marketing brochures and trade show participation of approximately $24,750.

- Increase in product development and technology expenses this quarter of approximately $14,652 is primarily due to increases in salaries for software developers of approximately $16,500 and certain decrease expenses compared to the previous quarter ended September 30, 2002.

Quarterly Performance

The Company's quarterly results as indicated below demonstrate the quarterly improvements the Company has made in the following areas:

- Revenue has generally increased each quarter

|        | 1ST
QTR. | 2ND
QTR. | 3RD
QTR. | 4TH
QTR. | 1ST
QTR.
|------- | -------- | -------- | -------- | -------- | --------
|        | 9/30/02  | 12/31/02 | 3/31/03  | 6/30/03  | 9/30/03 
|        |          |          |          |          |         
|Revenue | 163,198  | 193,040  | 376,364  | 440,879  | 354,387 

Financing and Liquidity

As of September 30, 2003, the Company had accounts receivables and other receivables of $184,590, prepaid expenses of $20,938, a working capital deficiency of $5,547,672 that included shareholders' loans of $669,230, accounts payables and accrued liabilities of $745,334, deferred revenue of $295,135, current portion of obligations under capital lease of $68,368, revolving loan of $121,459, current portion of loans payable of $350,000 and Lee convertible debentures of $3,500,000.

On September 30, 2003, the Company had an accounts receivable balance of $172,995, an increase of $78,826 from June 30, 2003. As of Nov 14, 2003, approximately 90% of the total accounts receivable balance have been collected from customers.

On July 10, 2003, two senior officers provided the Company $100,000 Cdn ($72,727 US) in the form of Shareholder loans. The proceeds of the loans were used partly to repay the Company's demand loan from the Canadian Imperial Bank of Canada and the remainder was used for working capital.

On July 30, 2001, the Company amended the Investment Agreement dated November 1, 2000 with Lee, whereby Lee would provide additional funding of up to $1,500,000 in the form of a floating rate subordinated convertible debenture (series G-R debentures).  This would result in a total investment by Lee of $3,000,000 if all debentures were converted.  The additional $1,500,000 subordinated convertible debenture would consist of a firm commitment of $710,000 and a discretionary commitment of $790,000 in the form of a series of debentures (series G-R) ranging in value from $310,000 to $50,000 each.  The series G-R debentures would be funded from August 10, 2001 to July 1, 2002.  The Company received $310,000 under the series "G" debenture by August 14, 2001 and $200,000 under series H debenture by September 5, 2001. The Amended Investment Agreement provides Lee the right to convert the second $1,500,000 floating rate subordinated convertible debenture into 8,522,727 common shares of the Company at a conversion price of $0.1760 per common share.  The first investment of $1,500,000 allowed Lee to convert their series "A-F" debentures to 6,902,429 common shares of the Company at a conversion price of $0.2173 (Note 9 in the audited financial statements).  Should Lee convert all debentures totalling $3,000,000 it would result in the Company issuing 15,425,156 common shares. The Amended Investment Agreement also contains certain affirmative and negative covenants that restrict the Company's activities.  As of September 30, 2003, the Company is in compliance with all the covenants in the Investment Agreement.  Each Series G-R subordinated convertible debenture bears interest at the Wall Street Journal rate less 1%. Interest due on the convertible debenture can be repaid or converted to shares of the Company at fair market value on the date of conversion at Lee's option.  In conjunction with the Amended Investment Agreement dated July 30, 2001, the Company also amended the November 30, 2000 Loan and Security Agreement, the Collateral License Agreement and the Registration Rights Agreements to reflect the series G-R debentures.

On August 1, 2002 the Company amended the Lee Investment Agreement dated July 30, 2001 adding an additional three subordinated convertible debentures designated series S-U for a total of $300,000. The Company has received $100,000 for the Series S debenture, $125,000 for the Series T debenture and $75,000 for the Series U debenture as of June 30, 2003.

On July 16, 2003 the Company and Lee entered into a Third Amendment To Investment Agreement, which amended the Investment Agreement dated November 1, 2000 whereby Lee agreed to provide additional funding of $100,000 in the form of a floating rate subordinated convertible debenture. The additional $100,000 subordinated convertible debenture was in the form of a series "V" debenture, which was funded on July 16, 2003.

On August 14, 2003 the Company and Lee entered into a Fourth Amendment To Investment Agreement, which amended the Investment Agreement dated November 1, 2000 whereby Lee agreed to provide additional funding of $100,000 in the form of a floating rate subordinated convertible debenture. The additional $100,000 subordinated convertible debenture was in the form of a series "W" debenture, which was funded on August 14, 2003.

The weighted average effective rate for the three months ended September 30, 2003 on all these debenture series "A-W" was 3.00%. Interest for the three months ended September 30, 2003 on these debentures amounted to $25,964.

As of October 31, 2003 Lee has invested with and loaned to the Company a total of $3,850,000 as detailed below:

|Series A-F Debentures                                    | $1,500,000
|-------------------------------------------------------- | ----------
|Series G-R Debentures                                    | 1,500,000 
|Series S-U Debentures                                    | 300,000   
|Total Convertible Loan Debentures as of June 30, 2003    | $3,300,000
|Series V Debenture                                       | 100,000   
|Series W Debenture                                       | 100,000   
|Total Convertible Loan Debentures as of October 31, 2003 | $3,500,000
|Loan payable October 31, 2003                            | 350,000   
|Total Debentures & Loans                                 | $3,850,000

All of the subordinated convertible debentures mature on January 9, 2004.

Based on the forecasted expenditures for the year ended June 30, 2004, the Company forecasts minimum annual operating cash requirements of approximately $2.6 million.  The Lee Enterprise investment of $200,000 provides the Company 8% of its forecasted operating cash requirements for fiscal year 2004.  Revenue from new media companies under contracts in June 2003 will help to offset the Company's cash flow shortfall of $2.4 million.  The Company expects additional revenues from clients signed in fiscal 2004 as they continue to launch additional XpressAuctionsä
 and Special Sections.

The Company is expecting XpressAuctionsä
 to continue contributing significant revenues in fiscal 2004 as the Company intensifies its direct marketing efforts in the United States. The Company expects to generate new auction revenue from both continuous vendor auctions and classified auctions when these products are launched in fiscal year 2004. Also the Company is having success cross marketing Special Sections and XpressAuctionsä
 with its existing client base. Special Sections clients are contracting for XpressAuctionsä
 and new XpressAuctionsä
 clients are contracting for Special Sections. The Company also anticipates that clients who ran XpressAuctionsä
 in fiscal year 2003 would run another XpressAuctionsä
 in fiscal year 2004.

The Company anticipates significant operating revenue improvements from both XpressAuctionsä
 and Special Sections in fiscal year 2004.

Plan of Operation

The Company is dependent on obtaining additional financing for ongoing operation, capital expenditures and working capital.  There is no assurance that such financing will be available when required by or under terms favorable to the Company.

The Company anticipates that media revenue from Lee will grow as Lee implements the Company's products at more of its daily newspapers.  Revenue generated from Lee for the period ended June 30, 2003 amounted to $280,082.  Revenue from Lee over the next year is expected to increase as Lee is continuing to roll out Special Sections across its 42 daily newspaper properties, which will result in increased revenue to the Company.  The Company also expects revenue to grow as each newspaper launches multiple Special Sections. The Company also expects to see increasing revenues from the Special Sections launched by Buffalo.com and Freedom to its 25 Community Newspapers (14 out of 25 have rolled out Special Sections as of June 30, 2003). The Company will work closely with each contracted media company to ensure that Special Sections are launched in all their newspapers. The Company expects additional Lee newspapers to run XpressAuctionsä
 in fiscal year 2004. In fiscal year 2003, 2 of Lee's 42 daily newspapers ran XpressAuctionsä
.. Also, we expect Freedom to run additional XpressAuctionsä
 in the 2004 fiscal year. Freedom ran 6 XpressAuctionsä
 with 6 of their 25 Community Newspapers in fiscal year 2003.

The Company expects to generate auction revenue from auction clients of 10digit Communications in fiscal year 2004. The company acquired 10digit communications in fiscal year 2003. The Company expects auctions will generate significant revenue in fiscal year 2004 from new auction clients, repeat auction clients and new auction products.

The Company also intends to develop additional products in conjunction with its media partners that will leverage the sales relationship it has developed with each media partner.  These future products will allow the media company's sales force to have additional products that they can sell to their local markets.  These additional products will result in incremental revenue for the Company from its established newspaper customer base.  Each additional media company agreement will generate additional revenue and cash flow.  Management is confident it will be successful in closing additional media agreements in the next year.

The Company is presently seeking additional funding through private offerings with individuals, institutions and media partners.  The Company believes it can raise additional funds through these offerings.

The management of the Company believes that it will generate sufficient cash through private offerings, customer revenue and investments from media partners to fund its operations for the 12-month period ending June 30, 2004.

Business Risks

The Company faces significant business risks on a going forward basis, which could negatively impact the Company:

- Raising the equity financing needed to operate the Company at its current operating level and providing the operating funds, capital additions and repayment of liabilities in a timely manner. If the Company is unsuccessful in this regard it will be required to reduce operating expenditures to a level that will be in-line with cash flows.
- The Company may be unsuccessful in obtaining additional media partners and its agreement with contracted clients may result in lower revenues than projected. In either case, the Company would have to re-evaluate its business model to determine if there was another partnership arrangement that would provide the economic, cash flow or business advantages it currently believes will be provided by media companies. The Company at this time cannot assess whether it could find other business partners and negotiate favorable terms that would provide the necessary revenue and cash flow required by the Company. If the Company is unsuccessful in this regard it will be required to reduce operating expenditures to a level that will be in-line with cash flows.
- A major competitor or new company could dominate the market sector being targeted by the Company. The Company would then have to assess the impact of the situation. The United States and Canadian newspaper markets are large and there may be room for multiple suppliers to service existing media companies. If not, then the Company would have to assess other market sectors it could penetrate successfully. If the Company is unsuccessful in this regard it will be required to reduce operating expenditures to a level that will be in-line with cash flows.

- The Company is dependent on key senior development personnel who have developed the Company's core product offering. Should these individuals leave the employ of the Company it would have a setback to its future development plans. This setback would be overcome by hiring new senior developers that would have to become familiar with the Company's products.
- The Company is dependent on the continual growth of the Internet as an advertising medium for local advertisers. Should this prove untrue the Company will have to assess other business strategies for selling promotional products to local advertisers.
- Technologies may change making the Company's products obsolete. The Company is aware of changes in technology and is integrating new technologies into its product offerings to ensure that they do not become obsolete because of changing technology.

The Company's exposure to market risk is dependent upon the fluctuation of interest rates.  The risk of foreign currency is not significant and the Company does not use derivative financial instruments.

Item 3 Controls and Procedures

Within the 90 days prior to the date of filing this Quarterly Report on Form 10-QSB, the Company carried out an evaluation, under the supervision and with the participation of the Company's management, including the Chief Executive Officer and the Chief Financial Officer, of the effectiveness of the design and operation of the Company's disclosure controls and procedures pursuant to Exchange Act Rule 13a-14. Based upon that evaluation, the Chief Executive Officer and the Chief Financial Officer concluded that the Company's disclosure controls and procedures are effective in timely alerting them to material information relating to the Company (including its consolidated subsidiaries) required to be included in the Company's periodic filings with the Securities and Exchange Commission. Subsequent to the date of that evaluation, there have been no significant changes in the Company's internal controls or in other factors that could significantly affect those internal controls, nor were any corrective actions required with regard to significant deficiencies and material weaknesses.

PART II - OTHER INFORMATION

Item 1.	Legal Proceedings

The Company is not involved in any legal proceedings.

Item 2. Changes in Securities and Uses of Proceeds

None.

Item 3. Defaults Upon Senior Securities

There have been no defaults by the Company regarding any senior securities.

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

None.

Item 5. Other Information

None.

Item 6. Exhibits and Reports on Form 8-K

(a) Exhibits

99.1 Certificate of Chief Executive Officer dated November 14, 2003.

99.2 Certificate of Chief Financial Officer dated November 14, 2003.

(b) None.

SIGNATURES

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

|                       |  | CityXpress Corp              
|---------------------- |  | -----------------------------
|                       |  |                              
|Date November 14, 2003 |  | /s/ Ken Bradley              
|                       |  | Signature                    
|                       |  |                              
|                       |  | Ken Bradley                  
|                       |  | Print Name                   
|                       |  |                              
|                       |  | Chief Operating Officer & CFO
|                       |  | Title                        



CERTIFICATION

I, Phil Dubois, certify that:

1.  I have reviewed this quarterly report on Form 10-QSB of CityXpress Corp.

2.  Based on my knowledge, this quarterly 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 quarterly report;

3.  Based on my knowledge, the financial statements, and other financial information included in this quarterly 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 quarterly 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 its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly 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 quarterly report (the "Evaluation Date"); and

c.  presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

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 quarterly 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: November 14, 2003



|/s/ Phil Dubois
|---------------
|[Signature]    
|President & CEO





CERTIFICATION

I, Ken Bradley, certify that:

1.  I have reviewed this quarterly report on Form 10-QSB of CityXpress Corp.

2.  Based on my knowledge, this quarterly 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 quarterly report;

3.  Based on my knowledge, the financial statements, and other financial information included in this quarterly 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 quarterly 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 its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly 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 quarterly report (the "Evaluation Date"); and

c.  presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

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 quarterly 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: November 14, 2003



|/s/ Ken Bradley                                  
|-------------------------------------------------
|[Signature]                                      
|Chief Financial Officer & Chief Operating Officer



Exhibit 99.1

Statement of Chief Executive Officer

Pursuant to Section 1350 of Title 18 of the United States Code

Pursuant to Section 1350 of Title 18 of the United States Code, I, Phil Dubois, the President & Chief Executive Officer of CityXpress Corp. (the "Corporation"), hereby certify that:

(1) I have reviewed the Quarterly Report on Form 10-QSB of the Corporation (the "Report") [to which this statement is an Exhibit];

(2) the Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

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

/s/   Phil Dubois

Name: Phil Dubois

Title:  President & Chief Executive Officer of CityXpress Corp.

Date: November 14, 2003



Exhibit 99.2

Statement of Chief Financial Officer

Pursuant to Section 1350 of Title 18 of the United States Code

Pursuant to Section 1350 of Title 18 of the United States Code, I, Ken Bradley, the Chief Financial Officer of CityXpress Corp. (the "Corporation"), hereby certify that:

(1) I have reviewed the Quarterly Report on Form 10-QSB of the Corporation (the "Report") [to which this statement is an Exhibit];

(2) the Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

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

/s/  Ken Bradley

Name: Ken Bradley

Title: Chief Financial Officer of CityXpress Corp.

Date: November 14, 2003