UNITED STATES



SECURITIES AND EXCHANGE COMMISSION



Washington, D.C. 20549





FORM 10-QSB



Quarterly Report Pursuant to Section 13 or 15(d) of the

Securities and Exchange Act of 1934.



For the quarterly period ended March 31, 2004



Commission File Number: 0-32507





Energy Producers, Inc.

(Exact name of registrant as specified in its charter.)



Nevada                                        8-0345961

(State or other jurisdiction of                         (I.R.S. Employer

incorporation or organization)                       identification No.)



7944 E. Beck Lane, Suite 140

Scottsdale, Arizona                                     85260-1774

(Address of principal executive offices)                       (Zip Code)



Registrant's telephone number, including area code: (480) 778-0488



Indicate  by check mark  whether the  registrant  (1) has filed all reports

required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of

1934  during  the  preceding  12 months  (or for such  shorter  period  that the

registrant was required to file such reports),  and (2) has been subject to such

filing requirements for the past 90 days.



YES [X]          NO [ ]



Indicate the number of shares  outstanding of each of the issuer's  classes

of common stock as of the latest practical date:



37,441,668 Shares of common stock issued and outstanding.







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ENERGY PRODUCERS, INC

10-QSB

March 31, 2004



Table of Contents

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



PART 1: FINANCIAL INFORMATION

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



Item 1. Financial Statements



Balance Sheets - Assets. . . . . . . . . . . . . . . . . . . . . . . . . . . 3



Balance Sheets - Liabilities and Stockholders' Equity  . . . . . . . . . . . 3



Statement of Operations-Three months . . . . . . . . . . . . . . . . . . . . 4



Statement of Cash Flows  . . . . . . . . . . . . . . . . . . . . . . . . . . 5



Statement of Changes in Shareholders' Equity  . . . . . . . . . . . . . . .. 6





Notes to Consolidated Financial Statements . . . . . . . . . . . . . . . . . 7



Item 2. Management's Discussion and Analysis

or Plan of Operation . . . . . . . . . . . . . . . . . . . . . . . .14



Item 3. Controls and Procedures  . . . . . . . . . . . . . . . . . . . . . .16



PART II: OTHER INFORMATION

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



Item 1 - Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . . .17



Item 2 - Changes in Securities . . . . . . . . . . . . . . . . . . . . . . .17



Item 3 - Defaults upon Senior Securities . . . . . . . . . . . . . . . . . .18



Item 4 - Submission of Matters to a Vote of Security Holders . . . . . . . .18



Item 5 - Other Information . . . . . . . . . . . . . . . . . . . . . . . . .18



Item 6 - Exhibits and Reports on Form 8-K. . . . . . . . . . . . . . . . . .18



Certifications



Signature  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19















2

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PART I. FINANCIAL INFORMATION



Item 1.  Financial Statements



Energy Producers, Inc.

Consolidated Balance Sheets

As of March 31, 2004 and December 31, 2003



|ASSETS                                                            |                                          |  |          |            |             | 31-Mar-04  |             | 31-Dec-03 
|----------------------------------------------------------------- | ---------------------------------------- |  | -------- | ---------- | ----------- | ---------- | ----------- | ----------
|                                                                  |                                          |  |          |            |             |            | (Unaudited) |           
|Current assets:                                                   |                                          |  |          |            |             |            |            
|Cash & interest bearing deposits                                  |                                          |  |          | $227,668   |             | $45,155   
|Accounts receivable                                               |                                          |  |          |            | 4,064       |            | 21,933     
|Total current assets                                              |                                          |  |          |            | 231,732     |            | 67,088     
|                                                                  |                                          |  |          |            |             |            |             |           
|Other assets:                                                     |                                          |  |          |            |             |            |             |           
|Property & equipment- net                                         |                                          |  |          | 1,443,973  |             | 1,523,812 
|Receivables from shareholders                                     |                                          |  |          | 29,505     |             | 167,890   
|                                                                  | Total assets                             |  |          |            |             | $1,705,210 |             | $1,758,790
|                                                                  |                                          |  |          |            |             |            |             |           
|LIABILITIES AND SHAREHOLDERS' EQUITY                              |                                          |  |          |            |            
|                                                                  |                                          |  |          |            |             |            |             |           
|Current liabilities:                                              |                                          |  |          |            |             |            |            
|Accounts payable & accrued expenses                               |                                          |  | $640,440 |            | $462,334   
|Advances and notes payable- shareholders                          |                                          |  | 666,453  |            | 638,679    
|Accrued interest payable                                          |                                          |  |          | 179,703    |             | 166,513   
|Deferred revenues                                                 |                                          |  |          |            | 161,564     |            | 123,649    
|Loans payable to banks                                            |                                          |  |          |            | 16,698      |            | 4,936      
|Notes payable                                                     |                                          |  |          |            | 3,000       |            | 3,000      
|Capital lease payable- current portion                            |                                          |  | 0        |            | 3,989      
|                                                                  | Total current liabilities                |  |          |            | 1,667,858   |            | 1,403,100  
|                                                                  |                                          |  |          |            |             |            |             |           
|Capital lease payable- non current portion                        |                                          |  | 0        |            | 9,273      
|                                                                  | Total liabilities                        |  |          |            |             | 1,667,858  |             | 1,412,373 
|                                                                  |                                          |  |          |            |             |            |             |           
|Net liability of discontinued operation                           |                                          |  | 29,096   |            | 29,096     
|                                                                  |                                          |  |          |            |             |            |             |           
|Shareholders' equity:                                             |                                          |  |          |            |             |            |            
|Preferred stock, 50,000,000 shares authorized at par value $.001, |                                          |  |          |           
|                                                                  | no stated dividend, none outstanding     |  |          | $0         |             | $0        
|Common stock- $.001 par value, authorized 200,000,000 shares,     |                                          |  |          |           
|issued and outstanding, 37,441,668 at March 31, 2004 and          |                                          |  |          |           
|                                                                  | 36,088,968 shares at December 31, 2003   |  |          | 37,442     |             | 36,089    
|Additional paid in capital                                        |                                          |  |          | 3,220,770  |             | 2,983,534 
|Accumulated deficit                                               |                                          |  |          |            | (3,235,529) |            | (2,700,992)
|Accumulated other comprehensive loss                              |                                          |  | (14,427) |            | (1,310)    
|                                                                  | Total shareholders' equity               |  |          |            | 8,256       |            | 317,321    
|                                                                  |                                          |  |          |            |             |            |             |           
|                                                                  | Total Liabilities & Shareholders' Equity |  |          | $1,705,210 |             | $1,758,790
|                                                                  |                                          |  |          |            |             |            |             |           
|See the notes to the financial statements.                       
|3                                                                



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Energy Producers, Inc.

Unaudited Consolidated Statements of Operations

For the Quarters Ended March 31, 2004 and March 31, 2004





|                                                |                                         |  |           |           |            |            | 31-Mar-04  |           | 31-Mar-03
|----------------------------------------------- | --------------------------------------- |  | --------- | --------- | ---------- | ---------- | ---------- | --------- | ---------
|Revenues:                                       |                                         |  |           |           |            |            |            |          
|                                                | Gross revenues                          |  |           |           |            | $208       |            | $0       
|                                                | Less cost of sales                      |  |           |           |            | (47,666)   |            | 0        
|                                                |                                         |  |           |           |            |            |            |           |          
|                                                | Net gross profit on sales               |  |           |           | (47,458)   |            | 0         
|                                                |                                         |  |           |           |            |            |            |           |          
|General and administrative expenses:            |                                         |  |           |           |           
|                                                | General administration                  |  |           |           | 471,503    |            | 119,213   
|                                                |                                         |  |           |           |            |            |            |           |          
|                                                | Total general & administrative expenses |  |           | 471,503   |            | 119,213   
|                                                |                                         |  |           |           |            |            |            |           |          
|Net loss from operations                        |                                         |  |           |           | (518,961)  |            | (119,213) 
|                                                |                                         |  |           |           |            |            |            |           |          
|Other revenues and expenses:                    |                                         |  |           |           |            |           
|                                                | Other income                            |  |           |           |            | 0          |            | 0        
|                                                | Interest expense                        |  |           |           |            | (15,576)   |            | (33,833) 
|                                                |                                         |  |           |           |            |            |            |           |          
|Net loss before provision for income taxes      |                                         |  | (534,537) |           | (153,046) 
|                                                |                                         |  |           |           |            |            |            |           |          
|Provision for income taxes                      |                                         |  |           | 0         |            | 0         
|                                                |                                         |  |           |           |            |            |            |           |          
|Net loss from continuing operations             |                                         |  |           | (534,537) |            | (153,046) 
|                                                |                                         |  |           |           |            |            |            |           |          
|Discontinued operations (net of tax)            |                                         |  |           | 0         |            | 63,609    
|                                                |                                         |  |           |           |            |            |            |           |          
|Net loss                                        |                                         |  |           |           |            | ($534,537) |            | ($89,437)
|                                                |                                         |  |           |           |            |            |            |           |          
|Basic & fully diluted net loss per common share |                                         |  |           |           |           
|Loss from continuing operations                 |                                         |  |           | ($0.01)   |            | ($0.01)   
|Loss from discontinued operations               |                                         |  |           | $0.00     |            | $0.00     
|Loss per share                                  |                                         |  |           |           | ($0.01)    |            | ($0.01)   
|                                                |                                         |  |           |           |            |            |            |           |          
|Weighted average of common shares outstanding:  |                                         |  |           |          
|Basic & fully diluted                           |                                         |  |           |           | 36,459,568 |            | 13,217,812
|                                                |                                         |  |           |           |            |            |            |           |          
|See the notes to the financial statements.     
|4                                              



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Energy Producers, Inc.

Unaudited Consolidated Statements of Cash Flows

For the Quarters Ended March 31, 2004 and March 31, 2003





|                                                    |                                       |  |         |            |         |           | 31-Mar-04 |         | 31-Mar-03
|--------------------------------------------------- | ------------------------------------- |  | ------- | ---------- | ------- | --------- | --------- | ------- | ---------
|Operating Activities:                               |                                       |  |         |            |         |           |          
|Net loss from continuing operations                 |                                       |  |         | ($534,537) |         | ($89,437)
|Adjustments to reconcile net income items           |                                       |  |         |            |        
|not requiring the use of cash:                      |                                       |  |         |            |         |          
|                                                    | Depreciation & amortization           |  |         |            | 78,677  |           | 1,141    
|Changes in other operating assets and liabilities : |                                       |  |         |           
|                                                    | Accounts receivable                   |  |         |            |         | 19,031    |           | (5,375)
|                                                    | Accounts payable and accrued expenses |  |         | 403,578    |         | (82,508) 
|                                                    | Interest payable                      |  |         |            |         | 13,190    |           | 0      
|                                                    | Deferred revenues                     |  |         |            |         | 37,915    |           | 0      
|Net cash used by operations                         |                                       |  |         | 17,854     |         | (176,179)
|                                                    |                                       |  |         |            |         |           |           |         |          
|Investing Activities:                               |                                       |  |         |            |         |           |          
|Purchase of property & equipment                    |                                       |  | 0       |            | 0      
|Net cash used by investing activities               |                                       |  |         | 0          |         | 0        
|                                                    |                                       |  |         |            |         |           |           |         |          
|Financing Activities:                               |                                       |  |         |            |         |           |          
|                                                    | Payment of notes payable              |  |         |            | (1,500) |           | (52,058) 
|                                                    | Issuance of common stock              |  |         |            | 0       |           | 18,600   
|                                                    | Loans received from shareholders      |  |         | 166,159    |         | 237,433  
|Net cash provided by financing activities           |                                       |  | 164,659 |            | 203,975
|                                                    |                                       |  |         |            |         |           |           |         |          
|Net increase in cash during the period              |                                       |  | 182,513 |            | 27,796 
|                                                    |                                       |  |         |            |         |           |           |         |          
|Cash balance at beginning of the fiscal year        |                                       |  | 45,155  |            | 19,143 
|                                                    |                                       |  |         |            |         |           |           |         |          
|Cash balance at end of the period                   |                                       |  |         | $227,668   |         | $46,939  
|                                                    |                                       |  |         |            |         |           |           |         |          
|Supplemental disclosures of cash flow information:  |                                       |  |         |           
|Interest paid during the period                     |                                       |  |         | $0         |         | $0       
|Income taxes paid during the period                 |                                       |  | $0      |            | $0     
|                                                    |                                       |  |         |            |         |           |           |         |          
|See the notes to the financial statements.         
|5                                                  





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Energy Producers, Inc.



Unaudited Consolidated Statement of Changes in Shareholders Equity

For the Quarter Ended March 31, 2004





|                                           |  |               |  |           |  |            |  |              |  | Accumulated   |  |          
|------------------------------------------ |  | ------------- |  | --------- |  | ---------- |  | ------------ |  | ------------- |  | ---------
|                                           |  |               |  |           |  |            |  |              |  | Other         |  |          
|                                           |  | Common        |  | Common    |  | Paid in    |  | Accumulated  |  | Comprehensive |  |          
|                                           |  | Shares        |  | Par Value |  | Capital    |  | Deficit      |  | Loss          |  | Total    
|                                           |  |               |  |           |  |            |  |              |  |               |  |          
|                                           |  |               |  |           |  |            |  |              |  |               |  |          
|Balance at 1/1/04                          |  | 36,088,968    |  | $36,089   |  | $2,983,534 |  | ($2,700,992) |  | ($1,310)      |  | $317,321 
|                                           |  |               |  |           |  |            |  |              |  |               |  |          
|Stock issued to consultants                |  | 1,352,700     |  | 1,353     |  | 237,236    |  |              |  |               |  | 238,589  
|                                           |  |               |  |           |  |            |  |              |  |               |  |          
|Foreign currency                           |  |               |  |           |  |            |  |              |  |               |  |          
|translation adjustment                     |  |               |  |           |  |            |  |              |  | (13,117)      |  | (13,117) 
|                                           |  |               |  |           |  |            |  |              |  |               |  |          
|Net loss for the period                    |  |               |  |           |  |            |  | (534,537)    |  |               |  | (534,537)
|                                           |  |               |  |           |  |            |  |              |  |               |  |          
|Balance at 3/31/04                         |  | 37,441,668    |  | $37,442   |  | $3,220,770 |  | ($3,235,529) |  | ($14,427)     |  | $8,256   
|                                           |  |               |  |           |  |            |  |              |  |               |  |          
|                                           |  |               |  |           |  |            |  |              |  |               |  |          
|                                           |  | Comprehensive |  |           |  |            |  |              |  |               |  |          
|                                           |  | Loss          |  |           |  |            |  |              |  |               |  |          
|                                           |  |               |  |           |  |            |  |              |  |               |  |          
|Foreign currency                           |  |               |  |           |  |            |  |              |  |               |  |          
|translation adjustment                     |  | ($13,117)     |  |           |  |            |  |              |  |               |  |          
|                                           |  |               |  |           |  |            |  |              |  |               |  |          
|Net loss for the period                    |  | (534,537)     |  |           |  |            |  |              |  |               |  |          
|                                           |  |               |  |           |  |            |  |              |  |               |  |          
|Comprehensive loss for the period          |  | ($547,654)    |  |           |  |            |  |              |  |               |  |          
|                                           |  |               |  |           |  |            |  |              |  |               |  |          
|                                           |  |               |  |           |  |            |  |              |  |               |  |          
|See the notes to the financial statements.
|6                                         







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Energy Producers, Inc.

Notes to the Unaudited Financial Statements

For the Quarters Ended March 31, 2004 and March 31, 2003



NOTE: -UNAUDITED INTERIM INFORMATION



The accompanying  unaudited consolidated financial statements have been prepared in  accordance  with  generally  accepted  accounting   principles  for  interim financial  information  and with the  instructions to Form 10-QSB and Regulation S-B. Accordingly,  they do not include  all of the  information  and  footnotes required by generally  accepted  accounting  principles  for complete  financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three-month period ending March 31, 2004 are not necessarily indicative of the results that may be expected for the year ending December 31, 2004.  For further information, refer to the financial statements and footnotes thereto included in the Company's Form 10-KSB for the year ended December 31, 2003.



(1) The unaudited  financial  statements include the accounts of Energy Producers,  Inc. and include all  adjustments  (consisting  of normal  recurring items) which are, in the opinion of management,  necessary to present fairly the financial  position as of March 31, 2004 and the results of  operations  and cash flows for the three-month  period ended March 31, 2004 and March 31, 2003. The results of operations for the three-month  period ended  March 31, 2004 are not necessarily indicative of the results to be expected for the entire year.





(2) Earnings (loss) per common shares are based on the weighted average number of shares outstanding during the period.





1.     Organization of the Company and Significant Accounting Principles



The Company was incorporated in the State of Nevada October 1995 as Sterling Market Positions, Inc. Effective June 24, 1999 the Company changed its name to Energy Producers, Inc.



In August 1999 the Company acquired by Energy Producers Group Inc. and its wholly owned subsidiary, Producers Supply, Inc.(PSI), an oil and gas service company located in Stephens, Arizona.  PSI was discontinued by management in fiscal year 2003.



Since August 1999, the Company has focused its activities on oil and gas exploration and development and production and acquisition of existing production facilities with proven reserves.  In November 2003, the Company sold its interest in its oil wells it had acquired since August 1999.



In November 2003, the Company acquired all of the issued and outstanding shares of International Group Holdings Inc. (IGHI) by issuing 17,015,156 shares of common stock.  IGHI became a wholly owned subsidiary of the Company.  IGHI is the owner of International Yacht Sales Group Ltd. (IYSG), a UK based on-line broker of luxury yachts, and other entities.  IYSG began its operations in April 2003.  In January 2004, the Company sold IGHI and its subsidiaries to another company.  However, the Company retained 100% of IYSG and received 10% of the issued and outstanding shares of the purchasing company in the transaction.



7

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Consolidation-the accompanying consolidated financial statements include the accounts of the company and its wholly owned subsidiaries.  All significant inter-company balances have been eliminated.



Use of Estimates- The preparation of the financial statements in conformity with generally accepted accounting principles requires management to make reasonable estimates and assumptions that affect the reported amounts of the assets and liabilities and disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses at the date of the financial statements and for the period they include.  Actual results may differ from these estimates.



Revenue Recognition-Brokeragerevenues from on-line retail yacht sales are recognized upon the completion of the transaction.



Cash and interest bearing deposits- For the purpose of calculating changes in cash flows, cash includes all cash balances and highly liquid short-term investments with an original maturity of three months or less.



Accounts receivable- The Company provides, through charges to income, a charge for bad debt expense, which is based upon management's evaluation of numerous factors.  These factors include economic conditions, a predictive analysis of the outcome of the current portfolio and prior credit loss experience, and the degree to which the receivable is secured by liens on assets.



Inventory-Inventories are stated at the lower of cost or market determined by the first-in first-out method.



Software Development Costs- The Company applies Statement of Financial Accounting Standard No. 86 (SFAS No. 86), Accounting for the Costs of Computer Software to be Sold, Leased, or Otherwise Marketed,(SFAS No. 86), to account for the costs in developing the IYSG software and web-site programs.



SFAS No. 86 provides that the costs of producing software programs subsequent to establishing technological feasibility shall be capitalized.  The capitalization of such costs ceases when the product becomes available to customers.  Amortization of the capitalized costs begins when the software product becomes available to customers and is calculated using the straight-line method over a period of three years.



Property & Equipment-Office and computer equipment are stated at cost. Depreciation expense is computed using the straight-line method over the estimated useful life of the asset. The following is a summary of the estimated useful lives used in computing depreciation expense:



Office equipment

3 years

Computer hardware

3 years

Software

3 years



Expenditures for major repairs and renewals that extend the useful life of the asset are capitalized.  Minor repair expenditures are charged to expense as incurred.



Long Lived Assets- The Company reviews for the impairment of long-lived assets whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment loss would be recognized when estimated future cash flows expected to result from the use of the asset and its eventual disposition is less than its carrying amount.



8

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Income taxes-The Company accounts for income taxes in accordance with the Statement of Accounting Standards No. 109  (SFAS No. 109), "Accounting for Income Taxes".  SFAS No. 109 requires an asset and liability approach to financial accounting and reporting for income taxes.  Deferred income tax assets and liabilities are computed annually for differences between financial statement and income tax bases of assets and liabilities that will result in taxable income or deductible expenses in the future based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income.  Valuation allowances are established when necessary to reduce deferred tax assets and liabilities to the amount expected to be realized.  Income tax expense is the tax payable or refundable for the period adjusted for the change during the period in deferred tax assets and liabilities.



Comprehensive Income - Effective July 1, 1998, the Company adopted SFAS No. 130, Reporting Comprehensive Income.  SFAS No. 130 requires that, as part of a full set of financial statements, entities must present comprehensive income, which is the sum of net income and other comprehensive income.  Other comprehensive income represents total non-stockholder changes in equity.  The Company has included its presentation of comprehensive income in the accompanying consolidated statements of stockholders equity.

Foreign Currency Translation -Balance sheet accounts of the Companys foreign operations are translated at the exchange rate in effect at year-end and income statement accounts are translated at the average exchange rate prevailing during the year.  Gains and losses arising from the translation of foreign subsidiary financial statements are included in other comprehensive income.

Discontinued Operations- The business operations of the PSI were discontinued through a formal plan of disposal by management in December 2003. The business activity of the subsidiary is summarized in the balance sheet as net liability from discontinued operations and in the statement of operations as loss from discontinued operations.





2.   Going Concern Considerations



The accompanying financial statements have been presented in accordance with generally accepted accounting principals, which assume the continuity of the Company as a going concern.  However, during the twelve months ending December 31, 2003 and in the prior fiscal year, the Company has experienced, and continues to experience, certain going concern issues related to profitability.  The Company incurred a net loss of $1,417,670 in fiscal 2003 and $503,325 in fiscal year 2002.



Managements plans with regard to this matter are as follows:



- Raise capital to develop new contracts and sales for the marine retail segment.

- Acquire proved developed oil and gas reserves with revenues at best negotiated  discount to market.

- Obtain a credit facility based in part on the value of business operations.



3.   Net Loss per Share



The Company applies SFAS No. 128, Earnings per Share. In accordance with SFAS No. 128, basic net loss per share has been computed based on the weighted average of common shares outstanding during the year. Diluted net loss per share gives the effect of outstanding common stock warrants convertible into common stock. The treasury stock method is used to calculate the dilutive effect of stock options outstanding.



9

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Warrants to purchase 4,600,000 and 6,600,000 shares of common stock were outstanding at December 31, 2003 and December 31, 2002, respectively.  The common stock equivalents of the warrants outstanding during fiscal years 2003 and 2002 were not included in the computation of loss per share because their effect would be antidilutive.



Net loss per common share has been computed as follows:



|                                      |  |            |         | 31-Mar-04  |         | 31-Mar-03
|------------------------------------- |  | ---------- | ------- | ---------- | ------- | ---------
|                                      |  |            |         |            |         |          
|Net loss from continuing operations   |  | ($534,537) |         | ($153,046)
|                                      |  |            |         |            |         |          
|Net loss from discontinued operations |  | $0         |         | $63,609   
|                                      |  |            |         |            |         |          
|Total shares outstanding              |  | 37,441,668 |         | 13,217,812
|                                      |  |            |         |            |         |          
|Weighted average                      |  | 36,459,568 |         | 13,217,812
|                                      |  |            |         |            |         |          
|Loss from continuing operations       |  | ($0.01)    |         | ($0.01)   
|Loss from discontinued operations     |  | 0.00       |         | 0.00      
|Loss per share                        |  |            | ($0.01) |            | ($0.01)





Options outstanding at March 31, 2004 are as follows.





|                               |  |           |  |           |  | Wgtd Avg       |  | Wgtd Years 
|------------------------------ |  | --------- |  | --------- |  | -------------- |  | -----------
|                               |  |           |  | Amount    |  | Exercise Price |  | to Maturity
|                               |  |           |  |           |  |                |  |            
|Outstanding at January 1, 2004 |  | 4,600,000 |  |           |  |               
|                               |  |           |  |           |  |                |  |            
|Issued                         |  |           |  | 0         |  |                |  |            
|Expired                        |  |           |  | (400,000) |  |                |  |            
|                               |  |           |  |           |  |                |  |            
|Outstanding at March 31, 2004  |  | 4,600,000 |  | $0.90     |  | 3.10          





4.   Common Stock Transactions



During the quarter ended March 31, 2004, the Company issued 1,352,700 shares of common stock to pay $238,589 of accrued consulting fees.



10

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5.   Property and Equipment



A summary of property and equipment at March 31, 2004 is as follows.





|Web site and software        |  |  |  | $1,540,000
|---------------------------- |  |  |  | ----------
|Office equipment & furniture |  |  |  | 24,833    
|Accumulated depreciation     |  |  |  | (120,860) 
|                             |  |  |  |           
|Net property & equipment     |  |  |  | $1,443,973





The category for office equipment and furniture includes $24,833 of equipment acquired by capital lease agreement.  The amount of accumulated amortization of capital leases is included in accumulated depreciation and is $16,116.





6.    Litigation



A former creditor of the Company has filed a claim for collection for $150,000 in Federal Court in the Western District of Texas.  The Company is currently in settlement negotiations with the creditor and the court has granted an extension to the Company to file an answer.  The Company has accrued the settlement in accounts payable and accrued expenses in the consolidated balance sheets at March 31, 2004.





7.   Debt



|The following is a listing of loans payable at March 31, 2004:    |  |        
|----------------------------------------------------------------- |  | -------
|                                                                  |  |        
|Unsecured line of credit at interest at 23%                       |  | $4,936 
|                                                                  |  |        
|Settlement to Citicorp for office equipment                       |  | 11,762 
|                                                                  |  |        
|Total loans payable                                               |  | $16,698
|                                                                  |  |        
|                                                                  |  |        
|The following is a listing of notes payable at Matrch 31, 2004    |  |        
|                                                                  |  |        
|Unsecured note issued to an unaffiliated individual in March 2002 |  |        
|at 10% due in March 2003.  The note is currently in default       |  | $3,000 
|                                                                  |  |        
|Total note payable                                                |  | $3,000 
|                                                                  |  |        
|                                                                  |  |        



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7.   Debt, continued



|                                                                                             |  |         
|-------------------------------------------------------------------------------------------- |  | --------
|The following is a listing of notes payable and advances from shareholders at March 31, 2004 |  |         
|                                                                                             |  |         
|Unsecured notes due to a shareholder due on demand interest rates                            |  |         
|ranging from 12% to 18%                                                                      |  | $146,525
|                                                                                             |  |         
|Unsecured notes due to a shareholder due on demand interest at 12%                           |  | 29,500  
|                                                                                             |  |         
|Unsecured note due to a shareholder due on demand interest at 12%                            |  | 4,000   
|                                                                                             |  |         
|Unsecured note due to a shareholder due on demand interest at 18%                            |  | 10,000  
|                                                                                             |  |         
|Unsecured note payable due on demand at interest of 9.50% due to                             |  |         
|a shareholder and officer of the Company                                                     |  | 245,000 
|                                                                                             |  |         
|Unsecured note payable due on demand at interest of 10% due to                               |  |         
|a shareholder of the Company                                                                 |  | 17,000  
|                                                                                             |  |         
|Unsecured advances to shareholders and officers of the                                       |  |         
|Company with interest imputed at 10%                                                         |  | 214,428 
|                                                                                             |  |         
|                                                                                             |  |         
|Total advances and note payable to shareholders                                              |  | $666,453
|                                                                                             |  |         





8. Income Tax Provision



|Provision for income taxes is comprised of the following: |  |  |            |        
|--------------------------------------------------------- |  |  | ---------- | -------
|                                                          |  |  |            |        
|                                                          |  |  |            |        
|Net loss before provision for income taxes                |  |  | ($534,537) |        
|                                                          |  |  |            |        
|Current tax expense:                                      |  |  |            |        
|Federal                                                   |  |  |            |        
|State                                                     |  |  |            |        
|Total                                                     |  |  |            |        
|                                                          |  |  |            |        
|Less deferred tax benefit:                                |  |  |            |        
|Timing differences                                        |  |  |            |        
|Allowance for recoverability                              |  |  |            | 960,329
|Provision for income taxes                                |  |  |            | $0     
|                                                          |  |  |            |        



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8. Income Tax Provision, continued



|A reconciliation of provision for income taxes at the statutory rate to provision                            |  | 
|------------------------------------------------------------------------------------------------------------ |  | 
|for income taxes at the Company's effective tax rate is as follows:                                          |  | 
|                                                                                                             |  | 
|Statutory U.S. federal rate                                                                                  |  | 
|Statutory state and local income tax                                                                         |  | 
|Less allowance for tax recoverability                                                                        |  | 
|Effective rate                                                                                               |  | 
|                                                                                                             |  | 
|Deferred income taxes are comprised of the following:                                                        |  | 
|                                                                                                             |  | 
|Timing differences                                                                                           |  | 
|Allowance for recoverability                                                                                 |  | 
|Deferred tax benefit                                                                                         |  | 
|                                                                                                             |  | 
|Note:  The deferred tax benefits arising from the timing differences begin to expire in fiscal year 2010 and
|may not be recoverable upon the purchase of the Company under current IRS statutes.                          |  | 



13



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

The discussion and analysis  contained herein should be read in conjunction with the  preceding  financial  statements  and  the  information  contained  in  the Company's  Form  10-KSB  as  amended.  Except  for  the  historical  information contained  herein,  the matters  discussed in this Form 10-QSB  contain  forward looking  statements  within the meaning of Section 27A of the  Securities Act of 1933,  as amended,  and Section 21E of the  Securities  Exchange Act of 1934, as amended,  and the Private Securities  Litigation Reform Act of 1995,  including, among others (i) expected changes in the Company's  revenues and  profitability, (ii) prospective  business  opportunities  and (iii) the Company's  strategy for financing its business,  that are based on management's beliefs and assumptions, current  expectations,  estimates,  and  projections.  Statements  that  are not historical facts, including,  without limitation,  statements which are preceded by,  followed  by, or  include  the words  "believes,"  "anticipates,"  "plans," "expects,"   "may,"  "should,"  or  similar   expressions  are   forward-looking statements. Many of the factors that will determine the Company's future results are beyond the ability of the company to control or  predict.  These statements are subject to risks and uncertainties and, therefore, actual results may differ materially. Many of the risks and uncertainties that could cause actual results to differ materially from those anticipated are beyond the ability of the Company to control or predict. Those risks and uncertainties  include but are not limited to: The risk of significant natural disaster, the inability of the Company to insure against certain risks, fluctuations in commodity prices, inflationary and deflationary conditions and cycles, currency exchange rates effecting product demand, changing government regulations domestically and internationally effecting the marine industry, including various taxing authorities, VAT, OSHA, and general market conditions, competition and pricing. All  subsequent  written  and  oral   forward-looking   statements attributable  to the Company,  or persons  acting on its behalf,  are  expressed qualified  in  their  entirety  by  these  cautionary  statements.  The Company disclaims any obligation to update any forward-looking statements whether as a result of new information, future events, or otherwise.



We have recently acquired a new Marine segment operations, International Yacht Sales Group, Ltd. (IYSG) of Great Britain, in early December 2003. IYSG is engaged in global sales of private leisure and commercial vessels, from database entry providing available inventory listings for sale on demand to clientele through our proprietary software and IT brokerage network link and presence internationally via the web. We are working to expand and increase our revenue base in Fiscal Year 2004 by increasing more provisions for direct sales ability, and to develop business alliances to increase revenue potential in several key areas of this segments operations, and for growth and access through licensing arrangements with other countries and viable markets for the Marine sector around the world.



Managements Discussion and Analysis of Financial Condition



The Company was incorporated in the State of Nevada October 1995 as Sterling Market Positions, Inc. Effective June 24, 1999 the Company changed its name to Energy Producers, Inc.



In August 1999 the Company acquired by Energy Producers Group Inc. and its wholly owned subsidiary, Producers Supply, Inc.(PSI), an oil and gas service company located in Stephens, Arkansas.  PSI was discontinued by management in fiscal year 2003.



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Since August 1999, the Company has focused its activities on oil and gas exploration and development and production and acquisition of existing production facilities with proven reserves.  In November 2003, the Company sold its interest in its oil wells it had acquired since August 1999.



In November 2003, the Company acquired all of the issued and outstanding shares of International Group Holdings Inc. (IGHI) by issuing 17,015,156 shares of common stock.  IGHI became a wholly owned subsidiary of the Company.  IGHI is the owner of International Yacht Sales Group Ltd. (IYSG), a UK based on-line broker of luxury yachts, and other entities.  IYSG began its operations in April 2003.  In January 2004, the Company sold IGHI and its subsidiaries to another company.  However, the Company retained 100% of IYSG and received 10% of the issued and outstanding shares of the purchasing company in the transaction.



General Statement: Factors that may affect future results



With the exception of historical information, the matters discussed in Management's Discussion and Analysis of Financial Condition and Results of Operations contain forward looking statements under the 1995 Private Securities Litigation Reform Act that involve various risks and uncertainties.  Typically, these statements are indicated by words such as "anticipates", "expects", "believes", "plans", "could", and similar words and phrases.  Factors that could cause the company's actual results to differ materially from management's projections, forecasts, estimates and expectations include but are not limited to the following:



* Inability of the company to secure additional financing



* Unexpected economic changes in the United States



* The imposition of new restrictions or regulations by government agencies that affect the Company's business activities.



To the extent possible, the following discussion will highlight the activities of the Companys business activities for the quarters ended March 31, 2003 and March 31, 2004.



I. Results of Operations



Comparison of operating results



The Company had no significant commission revenues from its on-line yacht sales in Q1 2004.  Cost of sales included fixed costs allocated to yacht sales that are not dependent upon commissions generated.  The Company had a net gross loss on revenues of $47,458.



The revenues from the Companys oil and gas lease activities from Q1 2003 are included in discontinued operations as well as that segments cost of sales and allocated general administrative expenses.  The segment was sold in Q3 2003.



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General and administrative expense for Q1 2004 increased significantly to $471,503 compared to $119,213 in Q1 2003, and increase of 296%.  Most of the increase was due to professional and consulting fees associated with the Companys on-going litigation and for consulting fees associated with the Companys endeavors to secure financing and investigation of acquiring profitable businesses.  Consulting and professional fees increased approximately $250,000 in Q1 2004 over Q1 2003.



After deducting general and administrative costs, the Company experienced a loss from operations of $518,961 for the Q1 2004, compared to an operating loss of $119,213 for the same period last year.



Interest expense decreased in Q1 2004 to $15,576 compared to $33,833 in Q1 2003.  A significant amount of the Companys debt was sold in Q3 2003 along with the Companys oil and gas leasing segment.



Net loss for Ql 2004 was $534,537, or $0.01 per share compared to a loss of $89,437, or $0.01 per share for Q1 2003.



Discussion of Financial Condition: Liquidity and Capital Resources



At March 31, 2004 cash on hand was $227,668 as compared with $45,155 at December 31, 2003.  During the period the Company received $166,159 by from shareholders and paid $1,500 of a note payable.  Most of the bills associated with Q1 2004 are unpaid at March 31, 2004 hence operations added cash of $17,854.



The Company does not expect any material capital expenditures in fiscal year 2004.



At January 31, 2004, the Company had working capital deficit of $1,436,126 compared to a working capital deficit of $1,336,012 at December 31, 2003. Working capital decreased mainly as a result of operating losses.



Total assets at March 31, 2004 were $1,705,210 as compared to $1,758.790 at December 31, 2003.



The Company's total stockholders' equity decreased $309,065 from December 31, 2003 to $8,256 at March 31, 2004.  Stockholders equity decreased by $534,537 from operating losses in Q1 2004. In addition, the Company issued 1,352,700 shares of common stock valued at $238,589 to consultants for services rendered prior to December 31, 2003.  Finally, the Company recognized a loss of $13,117 from translating British based operations to US dollars at March 31, 2004.





Item 3.    CONTROLS AND PROCEDURES



Our Chief Executive Officer and Chief Financial Officer have evaluated as of the last day of the period covered by this report, the effectiveness of the design and operation of our disclosure controls and procedures  (as defined in Rule 15d-15 under the Securities  Exchange Act of 1934).  This evaluation was carried out under  the  supervision  and  with  the  participation  of our  management, including our principal executive officer and principal financial officer. Based on this evaluation,  these officers have concluded that the design and operation of our disclosure controls and procedures are effective.



16

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Disclosure  controls and procedures are our controls and other  procedures  that are  designed to ensure that  information  required to be disclosed by us in the reports that we file or submit  under the  Exchange Act is recorded,  processed, summarized  and reported,  within the time periods  specified in the SEC's rules and forms.  Disclosure  controls and  procedures  include,  without  limitation, controls  and  procedures  designed  to ensure that  information  required to be disclosed  by us in  the  reports  that  we  file  under  the  Exchange  Act  is accumulated and communicated to our management,  including  principal  executive officer  and  principal  financial  officer,  as  appropriate,  to allow  timely

decisions regarding required disclosure.



There were no changes in the Company's internal control over financial reporting (as defined in Rule 13a-15 under the  Securities Act of 1934) during the quarter ended June 30, 2003 that has  materially  affected,  or is reasonably  likely to materially affect, the Company's internal control over financial reporting.





PART II. OTHER INFORMATION



Item 1 - LEGAL PROCEEDINGS



The Company is involved in a collection matter in Federal Court in the Western District of the State of Texas, Midland-Odessa Division, Case # M0-04-CV-026. The case is titled Baseline Capital, Inc., a Texas Corporation vs. Energy Producers, Inc., A Nevada Corporation. The amount claimed is $150,000.00. The claim is correct and the Company has entered into settlement negotiations with the Plaintiff. The Company has been granted and extension to file an answer.



Item 2 - CHANGES IN SECURITIES



(*) In October 2003 the Company issued or subscribed for issuance 100,000 shares of its common restricted stock to the following person. The shares were issued pursuant to a private placement and carried a rule 144 legend. The shares were issued pursuant to an exemption from registration as provided in Section 4(2) of the Securities Act of 1933.



Share       Type of           Fair Market Value

Name                        Date     Amount      Consideration     of Consideration

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

Staci Karow (1)            2/11/03   100,000      Business Advisor  $ 8,000.00

Restricted Stock



______________

(*) $8,000 of the financing proceeds in the immediately preceding table were used primarily for Business Consulting Services.



(1) The individual listed in the immediately preceding table is not an affiliate, director, or officer of the Company.



On February 15, 2004 the Board of Directors of the Company approved by a majority vote a further filing of a Form S-8 Registration Statement for a stock incentive plan, which was filed with the Commission February 18, 2004.



17

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Item 3 - DEFAULTS UPON SENIOR SECURITIES



None.





Item 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS



None.





Item 5 - OTHER INFORMATION:



We are in negotiation with various potential merger partners to expand the asset base of the corporation. If a merger transaction is closed, the Registrant will report the event on a Form 8-K.





Item 6 - EXHIBITS AND REPORTS ON FORM 8-K



(a)      Exhibits



Exhibit No.    Description



31.1           CEO Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2           CFO Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32.1           CEO Certification Pursuant to 18 U.S.C. SECTION 1350

32.2           CFO Certification Pursuant to 18 U.S.C. SECTION 1350





(b)      Reports on Form 8-K



Amendment No. 2 to Current Report on Form 8-K/A dated December 1, 2003, filed February 17, 2004, to amend the date for the transfer of shares as previously stated in Item 1 and Item 2, and added Item 5 to report the status of the financial statements of International Group Holdings, Inc. required by Item 7



Amendment No. 3 to Current Report on Form 8-K/A dated December 1, 2003, filed March 26, 2004, to report Item 4, Changes in the Registrant's Certifying Accountant and under Item 5, the resultant delay in reporting the financial statements of International Group Holdings, Inc. required by Item 7.



Amendment No. 4 to Current Report on Form 8-K/A dated December 1, 2003, filed March 26, 2004, to amend Item 4, Changes in the Registrant's Certifying Accountant.



Current Report on Form 8-K, dated March 3, 2004, filed March 26, 2004 to report under Item 5 the decision of Registrant to not acquire AC Sports.



18

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SIGNATURE



Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the Registrant  has duly  caused  this  report  to be  signed  on its  behalf by the undersigned thereunto duly authorized.



ENERGY PRODUCERS, INC.





/s/ Gregg Fryett

By:     Gregg Fryett

Title:  Chairman and CEO

Date:  May 17, 2004





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