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

                                   FORM 10-QSB

                                   (Mark One)


        [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES
                              EXCHANGE ACT OF 1934

                   FOR THE QUARTERLY PERIOD ENDED MAY 31, 2003

       [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES
                              EXCHANGE ACT OF 1934

              FOR THE TRANSITION PERIOD FROM _________ TO _________

                         COMMISSION FILE NUMBER: 0-30703

                        COLLECTIBLE CONCEPTS GROUP, INC.
             (Exact name of registrant as specified on its charter)

                DELAWARE                                 95-4026880
     (State or other jurisdiction of                   (IRS Employer
     incorporation or organization)                 Identification No.)

                              1600 LOWER STATE ROAD
                              DOYLESTOWN, PA 18901
                    (Address of principle executive offices)

                                 (215) 491-1075
              (Registrant's telephone number, including area code)

        (Former name, former address and former fiscal year, if changed
                               since last report)

Indicate  by check  mark  whether  the  registrant:  (1) has filed  all  reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934 during the past 12 months (or for such shorter  period that the  registrant
was  required  to file such  reports),  and (2) has been  subject to such filing
requirements for the past 90 days. Yes [ ] No [X]

      APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING
                            THE PRECEDING FIVE YEARS:

Indicate by check mark whether the  registrant  filed all  documents and reports
required to be filed by Section 12, 13 or 15(d) of the  Securities  Exchange Act
of 1934 after the distribution of securities under a plan confirmed by a court.

                            Yes [_]     No [_]

                      APPLICABLE ONLY TO CORPORATE ISSUERS:

State the number of shares  outstanding of each of the  registrant's  classes of
common equity, as of the latest practicable date:  478,972,190 shares issued and
outstanding as of June 30, 2004


<PAGE>


                        COLLECTIBLE CONCEPTS GROUP, INC.

                                      INDEX

PART I    FINANCIAL INFORMATION

          ITEM 1 Condensed  Consolidated  Balance Sheet As Of
                 May 31, 2003 (Unaudited) ................................     3

                 Condensed    Consolidated    Statements   Of
                 Operations  For The Three  Months  Ended May
                 31, 2003 And 2002 (Unaudited) ...........................     4

                 Condensed  Consolidated Statement Of Changes
                 In  Shareholders'  Deficiency  For The Three
                 Months Ended May 31, 2003 (Unaudited) ...................     5

                 Condensed  Consolidated  Statements  Of Cash
                 Flows  For The  Three  Months  Ended May 31,
                 2003 And 2002 (Unaudited) ...............................     6

                 Notes To  Condensed  Consolidated  Financial
                 Statements As Of May 31, 2003  (Unaudited) ..............  7-16

          ITEM 2 Management's   Discussion  and  Analysis  of
                 Financial    Condition    and   Results   of
                 Operations .............................................. 17-23

          ITEM 3 Controls and Procedures .................................    24

PART II   OTHER INFORMATION

          ITEM 1 Legal proceedings .......................................    25
          ITEM 2 Changes in securities and use of proceeds ...............    25
          ITEM 3 Defaults upon senior securities .........................    25
          ITEM 4 Submission of matters to a vote of security holders .....    25
          ITEM 5 Other information .......................................    25
          ITEM 6 Exhibits and Reports on 8-K .............................    25

          SIGNATURES .....................................................    27



                                       2
<PAGE>

                 COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEET
                               AS OF MAY 31, 2003
                                    (UNAUDITED)


                                     ASSETS

CURRENT ASSETS

Cash                                                               $      1,503
Accounts receivable, net of allowance for doubtful accounts
   of $2,740                                                             36,644
Inventories                                                              17,577
                                                                   ------------
Total Current Assets                                                     55,724
                                                                   ------------

PROPERTY AND EQUIPMENT, NET                                              32,827
                                                                   ------------

OTHER ASSETS

Trademarks                                                                1,300
Security deposits                                                         3,200
                                                                   ------------
Total Other Assets                                                        4,500
                                                                   ------------
TOTAL ASSETS                                                       $     93,051
                                                                   ============

                    LIABILITIES AND SHAREHOLDERS' DEFICIENCY

CURRENT LIABILITIES

Accounts payable                                                   $  1,419,215
Accrued expenses                                                      1,678,240
Convertible secured debentures, net                                     705,263
Notes and loans payable, current portion                                750,278
Loans payable - related parties                                          85,039
Convertible subordinated debentures                                     114,800
                                                                   ------------
Total Current Liabilities                                             4,752,835

Notes and loans payable, long-term portion                                9,773
                                                                   ------------

TOTAL LIABILITIES                                                     4,762,608
                                                                   ------------

COMMITMENTS AND CONTINGENCIES                                                --

SHAREHOLDERS' DEFICIENCY

Common stock, $.001 par value, 700,000,000 shares
authorized, 134,389,407 shares issued and outstanding                   134,389
Common stock to be issued (2,085,384 shares)                             14,861
Additional  paid-in capital                                          14,467,638
Deferred equity based expense                                          (150,000)
Accumulated  deficit                                                (19,136,445)
                                                                   ------------
Total  Shareholders'  Deficiency                                     (4,669,557)
                                                                   ------------
TOTAL LIABILITIES AND SHAREHOLDERS' DEFICIENCY                     $     93,051
                                                                   ============


     See accompanying notes to condensed consolidated financial statements.


                                       3
<PAGE>


                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
               CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS FOR
                  THE THREE MONTHS ENDED MAY 31, 2003 AND 2002
                                   (UNAUDITED)

                                                     2003             2002
                                                -------------    -------------

SALES                                           $      50,145    $      40,233

COST OF SALES                                          30,966           61,684
                                                -------------    -------------
GROSS PROFIT (LOSS)                                    19,179          (21,451)

OPERATING EXPENSES

Selling, general and administrative                   204,140          224,020
                                                -------------    -------------

LOSS FROM OPERATIONS                                 (184,961)        (245,471)
                                                -------------    -------------

OTHER INCOME (EXPENSE)

Interest expense, net                                 (96,506)         (20,297)
Forgiveness of debt                                        --           70,778
                                                -------------    -------------
Total Other Income (Expense)                          (96,506)          50,481
                                                -------------    -------------

LOSS BEFORE TAX PROVISION                            (281,467)        (194,990)
INCOME TAX PROVISION                                       --               --
                                                -------------    -------------

NET LOSS                                        $    (281,467)   $    (194,990)
                                                =============    =============


BASIC AND DILUTED LOSS PER SHARE                $          --    $       (0.02)
                                                =============    =============

WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING
  - BASIC AND DILUTED                             116,626,868        8,348,514
                                                =============    =============


     See accompanying notes to condensed consolidated financial statements.


                                       4
<PAGE>


<TABLE>
<CAPTION>

                                          COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
                               CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' DEFICIENCY
                                               FOR THE THREE MONTHS ENDED MAY 31, 2003
                                                             (UNAUDITED)

                                                    COMMON STOCK
                         COMMON STOCK               TO BE ISSUED          ADDITIONAL       DEFERRED
                 ---------------------------  ------------------------      PAID-IN      EQUITY-BASED     ACCUMULATED
                     SHARES        AMOUNT       SHARES       AMOUNT         CAPITAL         EXPENSE         DEFICIT        TOTAL
                 ------------   ------------  ---------   ------------   ------------    -------------   ------------  ------------
<S>                <C>          <C>           <C>         <C>            <C>             <C>             <C>           <C>
Balance,
 February
  28, 2003         99,400,121   $     99,400  1,524,506   $     10,374   $ 14,396,576    $   (187,500)   $(18,854,978) $ (4,536,128)

Common
 stock
  issued
   for cash         9,714,286          9,714         --             --          7,286              --              --        17,000

Common
 stock
  issued
  for
   services
    rendered       14,025,000         14,025         --             --         42,075              --              --        56,100

Common stock
 to be  issued
 per
anti-dilution
  provision                --             --    560,878          4,487         (4,487)             --              --            --

Conversions
 of
 convertible
 secured
 debentures
  to common
   stock           11,250,000         11,250         --             --          1,188              --              --        12,438

Beneficial
 conversion
  on
  convertible
    debentures             --             --         --             --         25,000         (25,000)             --            --

Amortization
 of deferred
  equity
   based
    expense                --             --         --             --             --          62,500              --        62,500

Net loss,
  May 31,
   2003                    --             --         --             --             --              --        (281,467)     (281,467)
                 ------------   ------------  ---------   ------------   ------------    ------------    ------------  ------------
BALANCE
  MAY 31,
   2003           134,389,407   $    134,389  2,085,384   $     14,861   $ 14,467,638    $   (150,000)   $(19,136,445) $ (4,669,557)
                 ============   ============  =========   ============   ============    ============    ============  ============


                               See accompanying notes to condensed consolidated financial statements.

</TABLE>

                                                                  5
<PAGE>


                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                FOR THE THREE MONTHS ENDED MAY 31, 2003 AND 2002
                                   (UNAUDITED)

                                                        2003         2002
                                                     ---------    ---------
CASH FLOWS FROM OPERATING ACTIVITIES:

Net loss                                             $(281,467)   $(194,990)
Adjustments  to  reconcile  net loss to net cash
 (used in) provided by operating activities:

  Depreciation                                           5,091        5,931

  Common stock issued for services rendered             56,100       81,000

  Amortization of deferred equity based expense         62,500           --

  Forgiveness of debt                                       --       70,000

Changes in operating assets and liabilities:

Accounts receivable                                    (33,133)      10,840

Inventories                                              5,693           --

Accounts payable and accrued expenses                  107,703       28,248
                                                     ---------    ---------
Net Cash (Used in) Provided By Operating
  Activities                                           (77,513)       1,029
                                                     ---------    ---------
CASH FLOWS FROM INVESTING ACTIVITIES:                       --           --
                                                     ---------    ---------
CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from issuance of convertible secured
   debentures                                           25,000           --

Proceeds from issuance of convertible subordinated
  debentures                                            43,000           --

Proceeds from the issues of common stock                17,000           --

Repayment of notes and loans payable                      (578)      (5,109)

Proceeds from notes and loans payable                       --        6,500

Repayment of notes payable - related parties           (14,976)      (2,420)

Proceeds from notes payable - related parties            2,970           --
                                                     ---------    ---------
Net Cash Provided by/(Used in) Financing
 Activities                                             72,416       (1,029)
                                                     ---------    ---------
NET DECREASE IN CASH                                    (5,097)          --

CASH - BEGINNING OF PERIOD                               6,600          139
                                                     ---------    ---------
CASH - END OF PERIOD                                 $   1,503    $     139
                                                     =========    =========


     See accompanying notes to condensed consolidated financial statements.


                                       6
<PAGE>


                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               AS OF MAY 31, 2003
                                    UNAUDITED

NOTE 1   NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         (A) BASIS OF PRESENTATION

         These   condensed   consolidated   statements  have  been  prepared  in
         accordance with accounting  principles generally accepted in the United
         States  of  America  for   interim   financial   information   and  the
         instructions  to Form 10-QSB and do not include all the information and
         footnotes required by accounting  principles  generally accepted in the
         United  States of America for  complete  financial  statements.  In the
         opinion of management,  all adjustments (consisting of normal recurring
         accruals)  considered  necessary for a fair presentation of the results
         for the interim periods have been included.  Operating  results for the
         three months ended May 31, 2003 are not  necessarily  indicative of the
         results that may be expected for the year ended  February 28, 2004. The
         accompanying   condensed  consolidated  financial  statements  and  the
         information  included  under the heading  "Management's  Discussion and
         Analysis"  should be read in  conjunction  with the  Company's  audited
         consolidated  financial  statements  and related notes  included in the
         Company's Form 10-KSB for the year ended February 28, 2003.

         (B) PRINCIPLES OF CONSOLIDATION

         The condensed consolidated financial statements include the accounts of
         Collectible Concepts Group, Inc. and its two wholly owned subsidiaries,
         Team Sports  Specialties  Corporation  and Music Art  Corporation.  All
         significant intercompany accounts and transactions have been eliminated
         in consolidation.

         (C) USE OF ESTIMATES

         The  preparation  of condensed  consolidated  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
         disclosures  of contingent  assets and  liabilities  at the date of the
         condensed  consolidated  financial  statements and reported  amounts of
         revenues and expenses during the reporting period. Actual results could
         differ from those estimates.

         (D) LOSS PER SHARE

         Basic and diluted loss per share for all periods  presented is computed
         based on the weighted average number of common shares outstanding.  The
         assumed  conversions  of convertible  debentures  into common stock and
         exercises  of stock  options  was not  included in the  computation  of
         diluted loss per share  because the assumed  conversions  and exercises
         would be anti-dilutive.


                                       7
<PAGE>


                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               AS OF MAY 31, 2003
                                   (UNAUDITED)


         (E) 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
         account for employee stock-based compensation using the intrinsic value
         method  prescribed in Accounting  Principles  Board ("APB") 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.  The  Company  values  shares  issued in
         consideration of services at fair value.  Options or warrants issued to
         non-employees and consultants are recorded using the fair value method,
         based on the Black-Scholes  option-pricing model. There were no options
         issued to  employees  during  the  periods  presented.  Therefore,  the
         required  disclosure  of pro  forma  amounts  under  SFAS No.  123,  as
         modified by SFAS No. 148,  "Accounting for  Stock-Based  Compensation -
         Transition and Disclosure", has not been presented.

         (F) RECLASSIFICATIONS

         Certain  items have been  reclassified  in prior period  statements  to
         conform to the current period presentation.

         (G) RECENT ACCOUNTING PRONOUNCEMENTS

         In May 2003, the Financial  Accounting  Standards Board ("FASB") issued
         Statement  of  Financial   Accounting   Standards   ("SFAS")  No.  150,
         "Accounting For Certain Financial  Instruments with  Characteristics of
         both  Liabilities and Equity".  SFAS No. 150 changes the accounting for
         certain financial  instruments with characteristics of both liabilities
         and equity that, under previous  pronouncements,  issuers could account
         for as equity.  The new accounting  guidance  contained in SFAS No. 150
         requires that those  instruments  be classified as  liabilities  in the
         balance sheet.

         SFAS No.  150  affects  the  issuer's  accounting  for  three  types of
         freestanding financial instruments.  One type is a mandatory redeemable
         share,  which the issuing  company is obligated to buy back in exchange
         for cash or other  assets.  A second  type  includes  put  options  and
         forward purchase contracts,  which involves  instruments that do or may
         require the issuer to buy back some of its shares in exchange  for cash
         or other assets.  The third type of  instruments  that are  liabilities
         under this  Statement is  obligations  that can be settled with shares,
         the monetary value of which is fixed, tied solely or predominantly to a
         variable such as a market index, or varies  inversely with the value of
         the issuers' shares.  SFAS No. 150 does not apply to features  embedded
         in a financial instrument that is not a derivative in its entirety.


                                       8
<PAGE>


                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               AS OF MAY 31, 2003
                                   (UNAUDITED)


         Most of the  provisions  of  Statement  150  are  consistent  with  the
         existing  definition of liabilities  in FASB Concepts  Statement No. 6,
         "Elements of Financial  Statements".  The remaining  provisions of this
         Statement  are  consistent  with the  FASB's  proposal  to revise  that
         definition to encompass certain obligations that a reporting entity can
         or must  settle by issuing  its own  shares.  This  Statement  shall be
         effective for financial  instruments entered into or modified after May
         31, 2003 and otherwise shall be effective at the beginning of the first
         interim  period  beginning  after June 15, 2003,  except for  mandatory
         redeemable  financial  instruments of a non-public  entity, as to which
         the effective date is for fiscal periods  beginning  after December 15,
         2004.

         In January 2003, (as revised in December 2003) The Financial Accounting
         Standards Board ("FASB") issued  Interpretation No. 46,  "Consolidation
         of  Variable  Interest  Entities",   an  interpretation  of  Accounting
         Research Bulletin ("ARB") No. 51, "Consolidated  Financial Statements".
         Interpretation No. 46 addresses  consolidation by business  enterprises
         of variable interest entities,  which have one or both of the following
         characteristics: (i) the equity investment at risk is not sufficient to
         permit  the  entity  to  finance  its  activities   without  additional
         subordinated  support  from other  parties,  which is provided  through
         other  interest that will absorb some or all of the expected  losses of
         the entity; (ii) the equity investors lack one or more of the following
         essential  characteristics  of a controlling  financial  interest:  the
         direct  or  indirect  ability  to make  decisions  about  the  entities
         activities  through voting rights or similar rights;  or the obligation
         to absorb the expected losses of the entity if they occur,  which makes
         it  possible  for the entity to finance  its  activities;  the right to
         receive  the  expected  residual  returns of the entity if they  occur,
         which  is the  compensation  for the  risk of  absorbing  the  expected
         losses.

         Interpretation No. 46, as revised,  also requires expanded  disclosures
         by the primary  beneficiary (as defined) of a variable  interest entity
         and by an enterprise  that holds a significant  variable  interest in a
         variable interest entity but is not the primary beneficiary.

         Interpretation No. 46, as revised, applies to small business issuers no
         later  than the end of the  first  reporting  period  that  ends  after
         December 15, 2004. This effective date includes those entities to which
         Interpretation  46 had previously been applied.  However,  prior to the
         required  application of Interpretation No. 46, a public entity that is
         a  small  business  issuer  shall  apply   Interpretation  46  or  this
         Interpretation   to  those   entities   that  are   considered   to  be
         special-purpose  entities  no  later  than as of the  end of the  first
         reporting period that ends after December 15, 2003

         Interpretation   No.   46  may   be   applied   prospectively   with  a
         cumulative-effect  adjustment  as of the  date  on  which  it is  first
         applied or by restating  previously issued financial statements for one
         or more years with a  cumulative-effect  adjustment as of the beginning
         of the first year restated.


                                       9
<PAGE>


                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               AS OF MAY 31, 2003
                                   (UNAUDITED)


         In March 2004, the U.S. Securities and Exchange  Commission's Office of
         the Chief  Accountant  and the Division of Corporate  Finance  released
         Staff Accounting bulletin ("SAB") No. 105, "Loan Commitments  Accounted
         for  as  Derivative  Instruments".   This  bulletin  contains  specific
         guidance on the inputs to a valuation-recognition model to measure loan
         commitments  accounted for at fair value,  and requires that fair-value
         measurement  include only differences  between the guaranteed  interest
         rate in the loan  commitment and market  interest  rate,  excluding any
         expected future cash flows related to the customer relationship or loan
         servicing.   In  addition,   SAB105  requires  the  disclosure  of  the
         accounting   policy  for  loan   commitments,   including  methods  and
         assumptions  used to estimate the fair value of loan  commitments,  and
         any associated hedging strategies.  SAB 105 is effective for derivative
         instruments  entered into  subsequent to March 31, 2004 and should also
         be applied to existing instruments as appropriate.  The Company has not
         yet  completed  its  evaluation  of SAB 105, but does not  anticipate a
         material impact on the financial statements.

         Management does not expect the adoption of these pronouncements to have
         a material impact on the Company's  consolidated  financial position or
         results of operations.

NOTE 2   GOING CONCERN

         The accompanying  condensed consolidated financial statements 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.  Since  inception,  the Company has not  generated
         sufficient  revenues to meet its  operating  expenses  and has incurred
         significant  operating  losses and net losses.  As of and for the three
         months ended May 31, 2003, the Company had a working capital deficiency
         of $4,697,111,  a shareholders' deficiency of $4,669,557, a net loss of
         $281,467 and net cash used in  operations  of $77,513.  The Company has
         minimal cash available for operations and is in default with respect to
         repayment provisions of certain secured and subordinated debentures. In
         addition,   the  Company   was  not  able  to  complete  an   effective
         registration  statement  within 150 days as required in connection with
         the sale of convertible secured debentures to a group of investors and,
         as a result,  the  Company is in default  of the  debenture  agreement.
         These matters raise  substantial  doubt about the Company's  ability to
         continue  as a going  concern.  The  condensed  consolidated  financial
         statements   do  not   include   any   adjustments   relating   to  the
         recoverability  and  classification  of recorded assets, or the amounts
         and  classification of liabilities that might be necessary in the event
         the Company cannot continue in existence.


                                       10
<PAGE>


                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               AS OF MAY 31, 2003
                                   (UNAUDITED)


         In order to generate additional revenues and the working capital needed
         to  continue  and  expand  operations,  the  Company's  management  has
         committed  to  a  plan  for  reducing   expenses,   increasing   retail
         distribution  channels for its products and raising additional capital.
         There can be no assurances  that the Company will be able to obtain the
         necessary  funding  to  finance  their  operations  or grow  revenue in
         sufficient amounts to fund their operating expenses (See Note 10).

NOTE 3   CONVERTIBLE SECURED DEBENTURES

         In May  2000,  the  Company  issued  $400,000  of  secured  convertible
         debentures to a group of investors.  These debentures  matured in April
         2001, are secured by substantially all of the Company's assets and bear
         interest  at 10% per  annum,  payable  quarterly;  the  debentures  are
         convertible into common stock at any time at the holder's option at the
         lesser of $2.80 or 50% of market  value (the debt  discount  of $65,000
         assigned  to  this  beneficial   conversion  feature  was  recorded  as
         additional  paid-in  capital and the debt  discount  was  amortized  as
         interest  expense  in the  quarter  ended  May  31,  2000  because  the
         debentures  are  convertible at any time at the holder's  option);  the
         debentures also have warrants to purchase 57,143 shares of common stock
         at 110% of the market value on the closing  date - the warrants  have a
         five-year life and are exercisable immediately (using an option pricing
         model,  the  warrants  were  valued at  $280,000  using  the  following
         assumptions:  no  expected  payment  of  dividends,  expected  lives of
         warrants of three years,  a risk free rate of 6.5% and a volatility  of
         75%). The $280,000 was recorded as additional  paid-in  capital and the
         debt  discount was  amortized to interest  expense over the term of the
         related debentures. As of February 28, 2002, the debt discount had been
         fully amortized.  The debenture holders also have certain rights in the
         event the Company files a registration  statement.  The Company was not
         able to complete an effective registration statement within 150 days of
         the  debenture  sale.  As a result,  the  Company  is in default of the
         debenture  agreement.  As of the date of this report,  these debentures
         are still unpaid and in default.

         On May 28,  2002,  the  Company  issued a $75,000  convertible  secured
         debenture to a group of investors with a conversion price of 50% of the
         average of the lowest three  intraday  trading prices during the twenty
         days  immediately  preceding  conversion.  This results in a beneficial
         conversion  feature of $75,000,  which has been fully  recognized as an
         expense at February  28,  2003.  The  debentures  bear  interest of 12%
         simple  interest per annum and matured on July 28, 2003. The debentures
         are convertible  into shares of the Company's  common stock at any time
         at the  holder's  option  equal to the  quotient  of (a) the  aggregate
         amount of the principle and accrued  interest and unpaid interest to be
         so  converted  by (b)  the  conversion  price.  As of the  date of this
         report, these debentures are still unpaid and in default.

         On November  26,  2002,  the  Company  issued  $250,000 of  convertible
         secured debentures to a group of investors.  These debentures mature on
         November  26,  2003  and  bear  interest  at  15%  per  annum  and  are
         convertible  into shares of the Company's  common stock at the lower of
         $.01 or 25% of the average of the lowest three intraday  trading prices
         during the twenty trading days immediately preceding  conversion.  This


                                       11
<PAGE>


                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               AS OF MAY 31, 2003
                                   (UNAUDITED)


         results in a beneficial  conversion  feature in the amount of $250,000,
         (since it is limited to the amount  received)  which is being amortized
         over the term of the loan.  Of this  amount,  $62,500 was  amortized to
         expense during the three months ended May 31, 2003 and $125,000 remains
         deferred as of May 31, 2003.

         On May 13, 2003,  the Company  issued  $25,000 of  convertible  secured
         debentures to a group of investors.  These debentures mature on May 13,
         2004 and bear interest at 15% per annum and are convertible into shares
         of the  Company's  common  stock  at the  lower  of  $.01 or 25% of the
         average of the lowest three  intraday  trading prices during the twenty
         trading  days  immediately  preceding  conversion.  This  results  in a
         beneficial  conversion  feature in the amount of $25,000,  (since it is
         limited to the amount  received) which is being amortized over the term
         of the loan. The entire  beneficial  conversion  expense of $25,000 has
         been deferred as of May 31, 2003.

         The following  schedule reflects  convertible  secured debentures as of
         May 31, 2003 (in order of due date):

         10% convertible secured debentures, due April 2001
         (net of conversions) (A)                                      $ 355,263

         12% convertible secured debentures, due July 2003 (A)            75,000

         15% convertible secured debentures, due November 2003 (A)       250,000

         15% convertible secured debentures, due May 2004 (A)             25,000
                                                                       ---------
            Total                                                      $ 705,263
                                                                       =========

         (A) In default

NOTE 4   NOTES AND LOANS PAYABLE

         As of May 31,  2003,  notes  and loans  payable  consisted  of  various
         unsecured notes and loans payable to certain individuals, investors and
         an auto finance  company.  The notes and loans bear interest at various
         rates  ranging  from 8.0% to 12.0% and had various  maturities  through
         August 2001, except for the automobile loan, which matures February 28,
         2006. The balance of the notes and loans payable, with the exception of
         the auto loan, are in default and remain unpaid as of May 31, 2003.


                                       12
<PAGE>


                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               AS OF MAY 31, 2003
                                   (UNAUDITED)


         The Company has loans  payable of $85,039,  which are included as loans
         payable - related parties in the  accompanying  condensed  consolidated
         balance sheet, due to the Company's president and other related parties
         as of May 31, 2003.  During the three  months  ended May 31, 2003,  the
         Company recorded  interest expense of $1,342 relating to loans from its
         president and other related parties and $83,570 in accrued interest was
         payable relating to these loans as of May 31, 2003 which is included in
         accrued expenses in the  accompanying  condensed  consolidated  balance
         sheet (See Note 8).

NOTE 5   CONVERTIBLE SUBORDINATED DEBENTURES

         The  Company  has  outstanding  $71,800  of  convertible   subordinated
         debentures  that bear  interest at 12% per annum and matured at various
         times through  August 2001.  The  debentures  are in default and remain
         unpaid.  Each $1,000 unit is  convertible  at any time at the  holder's
         option,  into between 143 and 1,429 shares of Company  common stock for
         an aggregate of 38,214 common shares.

         The Company issued an additional  $43,000 of  convertible  subordinated
         debentures  during the three months ended May 31, 2003.  The debentures
         bear interest at 12% per annum and have a term of one year.  Subsequent
         to May 31, 2003, the  debentures  were not paid at the due date and are
         in default. Each $1,000 unit is convertible at any time at the holder's
         option,  into 1,000,000 shares of Company common stock for an aggregate
         of 43,000,000 common shares.

         The following schedule reflects convertible  subordinated debentures as
         of May 31, 2003 (in order of due date):

         12% convertible subordinated debentures,  unsecured,
         due at various times through August 2001 (A)                  $  71,800

         12% convertible subordinated debentures,  unsecured,
         due at various times during quarter ended May 31, 2004 (A)       43,000
                                                                       ---------
            Total                                                      $ 114,800
                                                                       =========

         (A) In default

NOTE 6   COMMON STOCK

         In October  2001,  the Company  entered into an agreement  with a third
         party whereby the third party has an anti-dilution  ownership of 1.603%
         of the Company. The Company has not issued the 2,085,384 shares owed as
         of May 31, 2003,  to the third party.  These shares are shown as common
         stock to be issued with a corresponding  decrease to additional paid in
         capital, for all periods presented.


                                       13
<PAGE>


                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               AS OF MAY 31, 2003
                                   (UNAUDITED)


         During the three  months  ended May 31,  2003,  the  Company  converted
         $12,438 of convertible  secured  debentures into  11,250,000  shares of
         common stock having a fair value of $103,125.  The  conversions of debt
         to stock were based upon negotiated  conversion prices with the debtors
         (See Note 3).  Based on sales of common stock for cash during the three
         months  ended May 31, 2003 for prices below  market  value,  no gain or
         loss  has  been  recognized  on  the   aforementioned   conversions  of
         convertible secured debentures.

         During  the three  months  ended May 31,  2003,  the  Company  received
         $17,000 from the issuance of 9,714,286  shares of common stock  through
         private placements to various investors.

         From time to time,  the Company has issued common stock in exchange for
         the  performance  of  services or as an  alternative  to the payment of
         interest  on  outstanding  debt,   internal  accounting  and  financial
         services,  internet  website  creation,  marketing,  insurance  program
         review and general  management  consulting.  The dollar  value of these
         activities included in the selling, general and administrative expenses
         was $56,100 and  $81,000  for the three  months  ended May 31, 2003 and
         2002,  respectively.  These transactions have been recorded at the fair
         value of the  services  rendered or the fair value of the common  stock
         issued,  whatever  was more  readily  evident.  The number of shares of
         common stock  issued for  services  performed in the three months ended
         May 31, 2003 and 2002 was 14,025,000 and 2,314,285, respectively.

NOTE 7   COMMITMENTS AND CONTINGENCIES

         (A) LICENSES

         The  Company  has  entered  into  various  licensing   agreements  (the
         "Agreements") for the right to manufacture, sell and distribute certain
         collectibles  and  novelties  relating  to  current  and  future  movie
         characters,  as well as certain accessories  containing logos and names
         of professional  minor league and college sports teams.  The Agreements
         expire at various dates through 2003 and generally  require the Company
         to pay a royalty of between 9% and 11% of sales,  with certain  minimum
         royalty payments  required.  The unpaid minimum royalty fees related to
         these  agreements  of $286,500 are included in accrued  expenses in the
         accompanying condensed consolidated balance sheet.

         (B) CONTINGENCIES

         In fiscal  2002,  a licensing  company  commenced a lawsuit for various
         causes of action for breach of  contract  and  trademark  infringement,
         seeking a permanent injunction precluding the Company from using any of


                                       14
<PAGE>


                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               AS OF MAY 31, 2003
                                   (UNAUDITED)


         the plaintiffs'  intellectual  property.  The Company  consented to the
         entry  of a  permanent  injunction  and  the  parties  entered  into  a
         settlement agreement,  which resulted in the dismissal of the action in
         the subsequent  period.  However,  despite the dismissal of the action,
         the plaintiff  reserves the right to pursue monetary claims against the
         Company for its breach of various license agreements.

         (C) CONCENTRATIONS

         Approximately  59% and 66% of the Company's  revenues were derived from
         its three largest  customers during the quarters ended May 31, 2003 and
         2002, respectively.

         The Company  obtains a significant  portion of its new borrowings  from
         one investor  group.  During the three  months ended May 31, 2003,  the
         Company  borrowed $25,000 from this investor group. As of May 31, 2003,
         a total of $705,262 was owed to this investor group (See Note 3).

         (D) OTHER CONTINGENCIES

         The Company is  non-compliant  with  respect to payment of employee and
         employer payroll-related taxes. The liability is $216,161 as of May 31,
         2003, which includes  penalties and interest and is included in accrued
         expenses.

NOTE 8   RELATED PARTY TRANSACTIONS

         The Company has an employment  agreement  with its  president,  who has
         elected  to defer a portion  of his salary in support of the cash needs
         of the Company.  As of May 31, 2003, the amount of salary  deferred was
         $345,125,  which is included in accrued expenses.  The Company has also
         issued stock options to the president.

         The  Company has loans  payable of $85,039,  which is included in loans
         payable - related parties in the  accompanying  condensed  consolidated
         balance sheet, due to the Company's president and other related parties
         as of May 31, 2003.  During the three  months  ended May 31, 2003,  the
         Company recorded  interest expense of $1,342 relating to loans from its
         president  and  related  parties and  $83,570 in accrued  interest  was
         payable relating to these loans as of May 31, 2003 which is included in
         accrued expenses in the  accompanying  condensed  consolidated  balance
         sheet.

NOTE 9   SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING ACTIVITIES
         IN THE STATEMENTS OF CASH FLOWS

         During the three  months  ended May 31,  2003,  the  Company  converted
         $12,438 of convertible  secured  debentures into  11,250,000  shares of
         common stock.  During the three months ended May 31, 2002,  the Company
         converted  $46,000  of notes  and loans  payable  and  related  accrued
         interest into 4,264,000 shares of common stock.


                                       15
<PAGE>


                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               AS OF MAY 31, 2003
                                   (UNAUDITED)


         Cash payments for interest expense were immaterial for the three months
         ended May 31, 2003 and 2002.

NOTE 10  SUBSEQUENT EVENTS

         Subsequent to May 31, 2003, the Company at various dates issued secured
         convertible debentures totaling $275,000 to a group of investors. These
         debentures mature one year from the date of issuance,  bear interest at
         15% per annum and are convertible  into shares of the Company's  common
         stock at the lesser of $ .01 or 75% discount  from the lowest bid price
         over  the  three   trading  days  during  the  twenty  days   preceding
         conversion.

         In December 2003, the Company and an employee  entered into a five-year
         Employment  Agreement  under which the  employee is to receive a weekly
         salary  of  $500.  Additionally,  20,000,000  stock  options  are to be
         granted at exercise  prices ranging from $.001 to $.004 per share.  The
         options have a ten-year  term.  An additional  3,200,000  shares of our
         common  stock  are to be issued on or  before  the  termination  of the
         employment  agreement.  Compensation afforded to the employee under the
         agreement  will also satisfy any and all  indebtedness  to the employee
         and  related  parties.  The  amount  of this  debt is  estimated  to be
         $219,530.

         Subsequent  to  May  31,  2003,  the  Company  entered  into  marketing
         relationships with various suppliers of products.

         Subsequent to May 31, 2003,  the Company issued  154,102,100  shares of
         common  stock to  thirty-seven  individuals,  in exchange  for services
         rendered.

         Subsequent to May 31, 2003,  the Company issued  246,815,390  shares of
         common stock to convert $48,404 of debt.

         Subsequent  to May 31, 2003,  the Company  issued  7,300,000  shares of
         common  stock as part of the  shares  owed to a third  party that has a
         1.603% anti-dilution ownership in the Company (See Note 6).

         In June 2004, the Company issued senior secured convertible  redeemable
         notes totaling $550,000 to a group of investors. These notes mature two
         years from the date of issuance, bear interest at 15% per annum and are
         convertible  into shares of the Company's  common stock at $ .01 or 75%
         discount  from the lowest bid price over the three  trading days during
         the twenty days preceding conversion.

         Subsequent to May 31, 2003,  the joint venture  agreement  with another
         company to market and sell battery  products was dissolved and replaced
         with a new  agreement  whereby  the  Company  sold its  trade  name and
         intellectual  property rights in the previous joint venture in exchange
         for 500,000  restricted  shares of Pivotal Self  Service  Technologies,
         Inc. common stock.


                                       16
<PAGE>


The  following  discussion  should  be read in  conjunction  with the  unaudited
condensed  consolidated financial statements and notes thereto set forth in Item
1 of  this  Quarterly  Report.  In  addition  to  historical  information,  this
discussion and analysis contains forward-looking  statements that involve risks,
uncertainties  and  assumptions,  which  could  cause  actual  results to differ
materially from Management's expectations.  Factors that could cause differences
include,  but are not  limited  to,  expected  market  demand for the  Company's
services,  fluctuations  in pricing for products  distributed by the Company and
services  offered  by  competitors,   as  well  as  general  conditions  of  the
telecommunications marketplace.

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

         Some of the  information in this Form 10-QSB  contains  forward-looking
statements that involve  substantial risks and  uncertainties.  You can identify
these  statements  by  forward-looking  words such as "may,"  "will,"  "expect,"
"anticipate," "believe," "estimate" and "continue," or similar words. You should
read statements that contain these words carefully because they:

         o     discuss our future expectations;

         o     contain projections of our future results of operations or of our
               financial condition; and

         o     state other "forward-looking" information.

         We believe it is important to communicate  our  expectations.  However,
there may be events in the future that we are not able to accurately  predict or
over  which we have no  control.  Our actual  results  and the timing of certain
events could differ materially from those  anticipated in these  forward-looking
statements  as a result of  certain  factors,  including  those set forth in our
filings with the Securities and Exchange Commission.

GENERAL

         The  following  detailed  analysis  of  operations  should  be  read in
conjunction with the 2003 audited consolidated  financial statements and related
notes  included in the  Company's  Form 10-KSB for the year ended  February  28,
2003.

         During the three months ended May 31, 2003, the Company  focused on the
new genre of films being so heavily  oriented to  characters  of comic books and
fantasies.  The  Company  pursued  licenses  mostly  in that  category  and will
supplement them with new trend properties as they appear.  Management recognizes
however,  that the Company  does not have the  financial  resources to engage in
product development and manufacturing activities.

         In August  2003,  the Company  re-evaluated  its  business  model.  The
Company  believes that  licenses have evolved into less time  sensitive and sale
spiking  properties.  The Company is not renewing or continuing licenses that do
not fit our new business model. The Company's new business model will be focused
on more evergreen properties and those with a longer window of opportunity.  The
Company  recognized  the need to have  products that  addressed  the  mainstream
consumer market where market size and repeat sales  opportunities could give the
Company a means to stabilize and grow its revenues.  To avoid the time,  expense
and risks associated with in-house new product  development,  the Company sought
out entities with  mainstream  consumer  products whose  marketability  could be
enhanced by the addition of the Company's  licenses.  These activities  produced
new joint  ventures and products that  addressed new markets in keeping with the
Company's new  marketing  direction  aimed at the  collegiate  and  professional
sports marketplaces.


                                       17
<PAGE>


ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS (CONTINUED)

         In March of 2003 the Company  entered  into a Joint  Venture  Agreement
with Pivotal Self-Service  Technologies,  Inc. a Canadian company to produce and
market   flashlight   and  battery   products   utilizing   Pivotal's   offshore
manufacturing  resources and the Company's licensing and marketing capabilities.
In connection with this joint venture,  the Company modified its pending license
agreement for Terminator 3 (T-3) to include flashlights and batteries along with
scrolls, pins and other desktop collectibles. Upon approval of the modifications
by the licensor to the license agreement,  Pivotal paid the Company $9,000 which
was used as the initial payment against the $50,000  guaranteed  royalty for the
T-3 license.  On November 8, 2003, the Joint Venture Agreement was dissolved and
a new Royalty and Services  Agreement  entered into with Pivotec,  a Division of
Pivotal Self Service  Technologies,  Inc.  Under the terms of the new agreement,
the Company sold the Mighty Volt trade name and all intellectual property rights
developed by the Company in the previous joint venture with Pivotal Self Service
Technologies,  Inc. in exchange  for 500,000  restricted  shares of Pivotal Self
Service  Technologies,  Inc.  common stock.  The Company will assist  Pivotec in
obtaining  licenses  and  managing  other  aspects  of the  business  of selling
licensed  flashlight and battery products.  Any licenses obtained in this manner
will be assigned to Pivotec. This agreement provides a 1% royalty to the Company
on net  sales  of any  flashlight  and/or  battery  products  containing  images
available  either from  licenses  the Company has or assisted in  obtaining  for
Pivotec.  Additionally,  the Company may sell these  licensed  products and will
receive a sales  commission  based on a formula  of  several  variables  that is
expected  to  produce  an  average  commission  of 15% of the  sale  price.  The
agreement  also contains a provision in which  Pivotec paid the Company  $16,000
for  services it  performed  in  obtaining  licenses.  This payment was credited
against the  outstanding  royalty  guarantee in the T-3 license  agreement.  The
Company  renegotiated  the total advance on the guarantee amount to $25,000 from
the original  amount of $50,000.  Under the  agreement,  the Company will retain
ownership of the T-3 license.

         During the three months ended May 31, 2003,  the Company issued $25,000
in  convertible  secured  debentures  that  bear  interest  at 15% per annum and
$43,000 of debentures have a 12% interest rate and are  convertible  into shares
of the Company's  common stock at the lower of $.01 or 25% of the average of the
lowest three intraday  trading prices during the twenty trading days immediately
preceding  conversion.  The funds are held in escrow and made  available  to the
Company "as needed" on a draw down basis each month. The investor also agreed to
purchase an additional  $275,000 in convertible secured notes upon the Company's
completion  of all  reporting  requirements  with the  Securities  and  Exchange
Commission  (SEC)  and the  filing  of a  registration  statement  with  the SEC
covering the shares of common stock underlying the convertible debentures.

CRITIAL ACCOUNTING POLICIES

         Our  financial  statements  are prepared  based on the  application  of
accounting principles generally accepted in the United States of America.  These
accounting  principles require us to exercise  significant judgment about future
events that affect the amounts  reported  throughout  our financial  statements.
Actual  events could unfold quite  differently  than our previous  judgments had
predicted.  Therefore the estimates  and  assumptions  inherent in the financial
statements  included in this report  could be  materially  different  once those
actual events are known. We believe the following  policies may involve a higher
degree of judgment and complexity in their  application  and represent  critical
accounting  policies used in the  preparation  of our financial  statements.  If
different  assumptions or estimates were used, our financial statements could be
materially different from those included in this report.


                                       18
<PAGE>


ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS (CONTINUED)

         Revenue  Recognition:  We recognize  revenues in accordance  with Staff
Accounting Bulletin 104, Revenue Recognition in Financial  Statements (SAB 104).
We develop and sell collectibles in the entertainment, sports and music markets.
Revenue from such product sales is  recognized  when  persuasive  evidence of an
arrangement exists,  delivery has occurred, the fee is fixed or determinable and
collectibility  is probable.  At this time the earnings  process is complete and
the risks and rewards of ownership have  transferred  to the customer,  which is
generally  when the goods are shipped  and all  significant  obligations  of the
Company have been satisfied.

         Accounts Receivable: We must make judgments about the collectibility of
our accounts receivable to be able to present them at their net realizable value
on the balance sheet. To do this, we carefully analyze the aging of our customer
accounts,  try to  understand  why  accounts  have not  been  paid,  and  review
historical  bad debt  problems.  From this  analysis,  we  record  an  estimated
allowance for receivables that we believe will ultimately become uncollectible.

         Realizability of Inventory Values: We make judgments about the ultimate
realizability  of our inventory in order to record our inventory at its lower of
cost or  market.  These  judgments  involve  reviewing  current  demand  for our
products in comparison to present inventory levels and reviewing inventory costs
compared to current market values.

         Long-lived  Assets.  We assess  the  impairment  of  long-lived  assets
whenever events or changes in  circumstances  indicate that their carrying value
may not be recoverable  from the estimated  future cash flows expected to result
from their use and eventual  disposition.  Our long-lived assets subject to this
evaluation  include  property and equipment and amortizable  intangible  assets.
Intangible  assets other than  goodwill are  reviewed  for  impairment  whenever
events or changes in  circumstances  indicate that the carrying value may not be
fully  recoverable.  We are  required  to  make  judgments  and  assumptions  in
identifying   those  events  or  changes  in  circumstances   that  may  trigger
impairment.


                                       19
<PAGE>


ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS (CONTINUED)

RECENT ACCOUNTING PRONOUNCEMENTS

         In May 2003, the Financial  Accounting  Standards Board ("FASB") issued
Statement of Financial  Accounting  Standards ("SFAS") No. 150,  "Accounting For
Certain  Financial  Instruments  with  Characteristics  of both  Liabilities and
Equity".  SFAS No. 150 changes the accounting for certain financial  instruments
with  characteristics  of both  liabilities  and  equity  that,  under  previous
pronouncements, issuers could account for as equity. The new accounting guidance
contained in SFAS No. 150  requires  that those  instruments  be  classified  as
liabilities in the balance sheet.

         SFAS No.  150  affects  the  issuer's  accounting  for  three  types of
freestanding  financial  instruments.  One type is a mandatory redeemable share,
which the issuing company is obligated to buy back in exchange for cash or other
assets. A second type includes put options and forward purchase contracts, which
involves  instruments  that do or may require the issuer to buy back some of its
shares in exchange for cash or other assets.  The third type of instruments that
are  liabilities  under this Statement is  obligations  that can be settled with
shares,  the monetary value of which is fixed, tied solely or predominantly to a
variable  such as a market  index,  or  varies  inversely  with the value of the
issuers' shares. SFAS No. 150 does not apply to features embedded in a financial
instrument that is not a derivative in its entirety.

         Most of the  provisions  of  Statement  150  are  consistent  with  the
existing  definition of liabilities in FASB Concepts  Statement No. 6, "Elements
of  Financial  Statements".  The  remaining  provisions  of this  Statement  are
consistent  with the FASB's  proposal to revise  that  definition  to  encompass
certain  obligations  that a reporting  entity can or must settle by issuing its
own shares. This Statement shall be effective for financial  instruments entered
into or modified  after May 31, 2003 and  otherwise  shall be  effective  at the
beginning of the first interim period beginning after June 15, 2003,  except for
mandatory redeemable  financial  instruments of a non-public entity, as to which
the effective date is for fiscal periods beginning after December 15, 2004.

         In January 2003, (as revised in December 2003) The Financial Accounting
Standards  Board  ("FASB")  issued  Interpretation  No.  46,  "Consolidation  of
Variable Interest  Entities",  an interpretation of Accounting Research Bulletin
("ARB")  No. 51,  "Consolidated  Financial  Statements".  Interpretation  No. 46
addresses  consolidation by business  enterprises of variable interest entities,
which  have  one or  both  of the  following  characteristics:  (i)  the  equity
investment  at risk is not  sufficient  to  permit  the  entity to  finance  its
activities without additional  subordinated support from other parties, which is
provided  through  other  interest  that will absorb some or all of the expected
losses  of the  entity;  (ii)  the  equity  investors  lack  one or  more of the
following essential  characteristics of a controlling  financial  interest:  the
direct or  indirect  ability to make  decisions  about the  entities  activities
through  voting  rights or  similar  rights;  or the  obligation  to absorb  the
expected  losses of the entity if they occur,  which  makes it possible  for the
entity to finance its  activities;  the right to receive the  expected  residual
returns of the entity if they occur,  which is the  compensation for the risk of
absorbing the expected losses.

         Interpretation No. 46, as revised,  also requires expanded  disclosures
by the primary  beneficiary (as defined) of a variable interest entity and by an
enterprise  that holds a significant  variable  interest in a variable  interest
entity but is not the primary beneficiary.


                                       20
<PAGE>


ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS (CONTINUED)

         Interpretation No. 46, as revised, applies to small business issuers no
later than the end of the first  reporting  period that ends after  December 15,
2004. This effective date includes those entities to which Interpretation 46 had
previously  been  applied.   However,  prior  to  the  required  application  of
Interpretation  No. 46, a public  entity that is a small  business  issuer shall
apply  Interpretation  46 or this  Interpretation  to  those  entities  that are
considered  to be  special-purpose  entities  no later than as of the end of the
first reporting period that ends after December 15, 2003

         Interpretation   No.   46  may   be   applied   prospectively   with  a
cumulative-effect  adjustment  as of the date on which it is first applied or by
restating  previously  issued financial  statements for one or more years with a
cumulative-effect adjustment as of the beginning of the first year restated.

          In March 2004, the U.S. Securities and Exchange Commission's Office of
the Chief  Accountant  and the  Division of  Corporate  Finance  released  Staff
Accounting  bulletin  ("SAB")  No.  105,  "Loan  Commitments  Accounted  for  as
Derivative Instruments".  This bulletin contains specific guidance on the inputs
to a  valuation-recognition  model to measure loan commitments  accounted for at
fair value,  and requires that fair-value  measurement  include only differences
between the guaranteed  interest rate in the loan commitment and market interest
rate,  excluding  any  expected  future  cash  flows  related  to  the  customer
relationship or loan servicing.  In addition,  SAB105 requires the disclosure of
the accounting  policy for loan  commitments,  including methods and assumptions
used to estimate the fair value of loan commitments,  and any associated hedging
strategies.  SAB  105 is  effective  for  derivative  instruments  entered  into
subsequent to March 31, 2004 and should also be applied to existing  instruments
as appropriate. The Company has not yet completed its evaluation of SAB 105, but
does not anticipate a material impact on the financial statements.

         Management does not expect the adoption of these pronouncements to have
a material impact on the Company's consolidated financial position or results of
operations.

RESULTS OF OPERATIONS

THREE MONTHS ENDED MAY 31, 2003 COMPARED TO THREE MONTHS ENDED MAY 31, 2002.

         Net  revenue  for the  three  months  ended  May 31,  2003 was  $50,145
compared to net revenue of $ 40,233 for the three months ended May 31, 2002. The
increase  in  revenue  was due  primarily  to the sales in X-Men and  Terminator
products that offset the loss of sales in products from Lord Of The Rings.

         Cost of sales for the three  months  ended May 31,  2003  decreased  by
$30,718 from the three months ended May 31, 2002.  Cost of sales as a percentage
of  revenues  decreased  to 61.8% for the  three  months  ended May 31,  2003 as
compared  to 153.3%  for the same  period  last  year.  The  decrease  is mainly
attributable to the sales of products that were developed in the previous year.

          Selling,  general and  administrative  expenses  for the three  months
ended May 31, 2003  decreased to $204,140  from $224,020 for the same period the
previous  year.  For the three  months  ended May 31,  2003 and May 31, 2002 the
services obtained through the issuance of stock include internal  accounting and
financial services, internet website creation,  marketing assistance,  insurance
program  review and  general  management  consulting  services  in the amount of
approximately  $56,100 and $81,000 respectively.  As previously  mentioned,  the
Company incurs  charges to bring the product to market.  These charges relate to
the costs of producing  samples as well as the related package design costs that
must be approved by the licensor prior to full  production  runs of the product.
For the three months ended May 31, 2003, the Company  incurred  charges relating
to the costs of producing the samples as well as the related  package  design of
approximately  $7,096 versus charges of approximately $1,642 for the same period
the previous year.


                                       21
<PAGE>


ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS (CONTINUED)

         The Company  incurred  interest expense of $96,506 for the three months
ended May 31, 2003 as compared to $20,297 for the same period the previous  year
due to increased borrowings and the beneficial conversion calculation related to
the  application  of the  EITF  ("Emerging  Issues  Task  Force")  Bulletin  for
accounting of convertible securities and notes and loans payable with beneficial
conversion features.  The beneficial conversion calculation added $25,000 and $0
of interest  expense  respectively  for the three  months ended May 31, 2003 and
2002 respectively.

         As a result of the above,  the Company  had a net loss of $281,467  for
the three  months  ended May 31, 2003 as compared to a net loss of $194,990  for
the same period last year.

LIQUIDITY AND CAPITAL RESOURCES

         Since the Company's inception, it has experienced significant operating
and net losses that it has been able to fund by obtaining  private capital.  The
Company,  therefore,  cannot  predict if and when it will  generate  income from
operations and if it will be able to raise sufficient  capital necessary to fund
future operations.  As of May 31, 2003, the Company has not generated sufficient
revenues to meet operating  expenses.  As a result,  there is substantial  doubt
about the Company's  ability to continue as a going concern.  We anticipate that
we will require up to approximately  $1,000,000 to fund our continued operations
for the next twelve months, depending on revenues from operations.

         As of May 31, 2003,  the Company had a working  capital  deficiency  of
$4,697,111.  The working capital  deficit  increased from February 28, 2003 as a
direct result of the unprofitable  operations for the three months ended May 31,
2003 that resulted in cash used in operating  activities of $77,513. The Company
had an ending cash balance of $1,503 at May 31, 2003.

         The Company has financed its losses through private sales of equity and
debt securities and the issuance of stock for services.  During the three months
ended May 31,  2003,  the Company  received  the  following  capital  infusions:
$17,000 from  issuance of common stock and  exercise of stock  options,  $25,000
from the issuance of convertible secured  debentures,  $43,000 from the issuance
of convertible subordinated debentures and $2,970 from other borrowings.  During
the three months ended May 31, 2003, the Company made payments of $15,553.

         To  obtain  funding  for our  ongoing  operations,  we  entered  into a
Securities Purchase Agreement with accredited  investors on May 13, 2003 for the
sale of (i) $25,000 in secured  convertible notes. The secured convertible notes
bear  interest  at 15%,  mature  one year  from the  date of  issuance,  and are
convertible into our common stock, at the investors' option, at the lower of (i)
$0.01 or (ii) 75% of the average of the three lowest intraday trading prices for
the common  stock on a principal  market for the 20 trading  days before but not
including  the  conversion  date.  The  full  principal  amount  of the  secured
convertible  notes is due upon  default  under the terms of secured  convertible
notes.  In  addition,  we have  granted  the  investors  a security  interest in
substantially  all of our  assets and  intellectual  property  and  registration
rights.

         The Company issued an additional  $43,000 of  convertible  subordinated
debentures  during the three  months  ended May 31, 2003.  The  debentures  bear
interest  at 12% per  annum  and have a term of one year.  Each  $1,000  unit is
convertible at any time at the holder's option, into 1,000,000 shares of Company
common stock for an aggregate of 43,000,000 common shares.


                                       22
<PAGE>


ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS (CONTINUED)

         An event of default has occurred regarding various convertibles secured
debentures and convertible  subordinated  debentures in that the Company did not
have  an  effective  registration  statement  within  150  days  of the  sale of
convertible debentures. As a result of this default, the Company is obligated to
pay the debenture  holders the principal amount of the debentures  together with
interest  and  certain  other  amounts.  The  Company  does not have the capital
resources  to pay  the  amounts  required  under  this  agreement.  The  secured
convertible  debenture holders have informed the Company that they do not intend
to take any  action  at this  time due to the  default.  The  Company  does not,
however, have any legally binding commitment from the debenture holders to waive
the  default  provision  of the  debentures.  Subsequent  to May 31,  2003,  the
convertible  secured  debenture  holders  converted  $34,619  of this  debt into
47,743,857  shares of the Company's  common stock and issued another $275,000 in
convertible secured debentures to the Company.

         As of May 31, 2003, the Company had $845,090 in  outstanding  notes and
loans payable,  $114,800 in convertible  subordinated debentures and $705,263 in
outstanding convertible secured debentures.  As of May 31, 2003, the Company had
$1,419,215 in accounts payable, $1,678,240 in accrued expenses, accrued payroll,
accrued  royalties  and  related  taxes.   These  liabilities  are  for  federal
withholding taxes and are related to calendar years 1999, 2000 and 2001. In July
2002, the Company  reached an agreement with the Internal  Revenue  Service on a
payment  plan for the back taxes  owed.  The plan called for the Company to make
twelve monthly payments of $5,272,  followed by six monthly payments of $13,200,
followed by six monthly  payments of $25,000.  The Company made the first eleven
payments of $5,272, but defaulted on payments thereafter.  In December 2002, the
Company began making monthly payments of $2,500,  which the Company continues to
do when the funds are available. The Company has a verbal agreement with the IRS
that the  Company  will  continue  to make  monthly  payments of $2,500 with the
understanding  that the Company will accelerate and increase these payments when
feasible,  and the IRS will refrain from pursuing immediate payment in full. The
Company, however, does not have a written agreement with the IRS to these terms.

         The  Company  has been able to operate  based on  deferring  vendor and
employee  payments,   deferring  interest  and  debt  repayments  and  obtaining
additional borrowings and proceeds from equity.  However,  there is no guarantee
that the Company will continue to be successful  with respect to these  actions.
Furthermore,  there can be no assurances that the Company will be able to obtain
the necessary  funding to finance their operations or grow revenue in sufficient
amounts to fund their operating expenses.


                                       23
<PAGE>


ITEM 3 - CONTROLS AND PROCEDURES

a)       EVALUATION OF DISCLOSURE  CONTROLS AND PROCEDURES.  As of May 31, 2003,
the Company's management carried out an evaluation, under the supervision of the
Company's  Chief  Executive  Officer  and  Principal  Financial  Officer  of the
effectiveness  of the design and operation of the Company's system of disclosure
controls  and  procedures  pursuant to the  Securities  and Exchange  Act,  Rule
13a-15(e) and 15d-15(e) under the Exchange Act). Based upon that evaluation, the
Chief  Executive  Officer and Principal  Financial  Officer  concluded  that the
Company's  disclosure controls and procedures were effective,  as of the date of
their  evaluation,  for the purposes of recording,  processing,  summarizing and
timely reporting material  information required to be disclosed in reports filed
by the Company under the Securities Exchange Act of 1934.

b)       CHANGES  IN  INTERNAL  CONTROLS.  There  were no  changes  in  internal
controls over  financial  reporting,  known to the Chief  Executive  Officer or
Principal  Financial  Officer that  occurred  during the period  covered by this
report that has  materially  affected,  or is likely to materially  effect,  the
Company's internal control over financial reporting.


                                       24
<PAGE>


                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES

                           PART II - OTHER INFORMATION

ITEM 1   LEGAL PROCEEDINGS

         From time to time, we may become involved in various lawsuits and legal
proceedings which arise in the ordinary course of business.  However, litigation
is subject to inherent  uncertainties,  and an adverse  result in these or other
matters may arise from time to time that may harm our business. We are currently
not aware of any such legal  proceedings  or claims  that we believe  will have,
individually  or in the  aggregate,  a material  adverse affect on our business,
financial condition or operating results.

ITEM 2   CHANGES IN SECURITIES AND USE OF PROCEEDS

         During the three months  ended May 31, 2003 the Company sold  9,714,286
shares for $17,000. The Company also issued 14,025,000 shares to six individuals
for services rendered. The shares have an aggregate fair market value of $56,100
based  on the  market  price  on the  dates  of  issuance.  The  Company  issued
11,250,000  shares of stock in exchange for $12,438 of  convertible  debentures.

         The Company  relied upon the exemption  provided in Section 4(2) of the
Securities Act of 1933 in connection  with  above-referenced  transactions.  The
Company relied on Section 4(2) with respect to these  transactions  as no public
solicitation  was  employed,  the  shares  bore  restrictive  legends,  and  the
acquirers of the shares had access to the  information  which would be contained
in the  Registration  Statement and had sufficient  sophistication  so as not to
require the protection  afforded by the  Registration  under the Securities Act.
Each of the purchasers of the Company's  securities was given the opportunity to
ask question of and received answers from Company  management.  No commission or
other  remuneration  was paid or given in connection  with the offer and sale of
the securities.

ITEM 3    DEFAULTS UPON SENIOR SECURITIES

         As of May  31,  2003  the  Company  was  in  default  on the  following
convertible  debentures  that the Company  has issued,  $400,000 on May 3, 2000,
$75,000 on June 3, 2002,  $145,000 on November 26, 2002, $25,000 on December 15,
2002,  $25,000 on December 31, 2002,  $30,000 on January 17, 2003 and $25,000 on
February  20,  2003.  The  Company  was also in default  at May 31,  2003 on all
interest  payments owed on these  amounts.  As a result of these  defaults,  the
Company is obligated to pay interest and certain other amounts.  The Company was
also in default on all interest payments owed on these  convertible  debentures.
These  defaults  continue to exist as of today.  The  Company  does not have the
capital  resources  to pay the amounts  required.  The  debenture  holders  have
informed the Company that they do not intend to take any action at this time due
to the  default.  The  Company  does  not,  however,  have any  legally  binding
commitment from the debenture holders. The debentures are secured  substantially
by all of the Company's assets.

ITEM 4   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         Not applicable.

ITEM 5   OTHER INFORMATION

         Not applicable.


                                       25
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES

                           PART II - OTHER INFORMATION


ITEM 6   EXHIBITS AND REPORTS ON FORM 8-K

         (a)   EXHIBITS.

               31.1 -   Certification  of Chief  Executive  Officer  pursuant to
                        Rule 13a-14 and Rule  15d-14(a),  promulgated  under the
                        Securities and Exchange Act of 1934, as amended

               31.2 -   Certification  of Chief  Financial  Officer  pursuant to
                        Rule  13a-14 and Rule 15d 14(a),  promulgated  under the
                        Securities and Exchange Act of 1934, as amended

               32.1 -   Certification  pursuant to 18 U.S.C.  Section  1350,  as
                        adopted  pursuant to Section  906 of the  Sarbanes-Oxley
                        Act of 2002 (Chief Executive Officer)

               32.2 -   Certification  pursuant to 18 U.S.C.  Section  1350,  as
                        adopted  pursuant to Section  906 of the  Sarbanes-Oxley
                        Act of 2002 (Chief Financial Officer)

         (b)   REPORTS ON FORM 8-K.

               None.


                                       26
<PAGE>


                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES

                                   SIGNATURES

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

                                             COLLECTIBLE CONCEPTS GROUP, INC.

Date:   September 17, 2004                   By: /s/ PAUL S. LIPSCHUTZ
                                               ---------------------------------
                                               Paul S. Lipschutz
                                               Chief Executive Officer


Date:   September 17, 2004                   By: /s/ PAUL S. LIPSCHUTZ
                                               ---------------------------------
                                               Paul S. Lipschutz
                                               Principal Financial Officer


                                       27