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

                                   Form 10-KSB

(Mark One)
           X          Annual report under Section 13 or 15(d) of the  Securities
                      Exchange Act of 1934 For the fiscal year ended January 31,
                      1997

                                            or

        ____          Transition report under Section 13 or 15(d) of the
                      Securities Exchange Act of 1934
                      For the transition period from __________ to _________

                         Commission File Number: 0-28514

                          TREASURY INTERNATIONAL, INC.
                 (Name of Small Business Issuer in Its Charter)

                    Delaware                                      98-0160284
        (State or Other Jurisdiction of                         (IRS Employer
         Incorporation or Organization)                      Identification No.)

              7040 Tranmere Drive
          Mississauga, Ontario, Canada                             L5S 1L9
    (Address of Principal Executive Offices)                      (Zip Code)

              Registrant's telephone number, including area code: (905) 673-1700

               Securities Registered Pursuant to Section 12(b) of the Act: None

                 Securities Registered Pursuant to Section 12(g) of the Act:

                                                          Name of Each Exchange
             Title of Each Class:                         on which Registered:
           Common Stock, par value                                 None
              $0.0001 per share

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

        Check if there is no disclosure of  delinquent  filers  pursuant to Item
405 of  Regulation  S-B  contained  in  this  form,  and no  disclosure  will be
contained,  to the  best of  registrant's  knowledge,  in  definitive  proxy  or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB[ ].

        As of January 31, 1997,  14,942,566  shares of the  registrant's  common
stock were outstanding.

        The  aggregate  market value of the voting stock held by  non-affiliates
computed by reference  to the price at which the stock was sold,  or the average
bid and asked prices of such stock, as of July 29, 1997 was $1,423,080.

                                     Page 1
<PAGE>

                                     PART I

        The  information  set  forth in this  Report on Form  10-KSB  including,
without  limitation,  that  contained  in Item 6,  Management's  Discussion  and
Analysis and Plan of Operation, contains "forward looking statements" within the
meaning  of  Section  27A of  the  Securities  Act  of  1933,  as  amended  (the
"Securities  Act"),  and Section 21E of the Securities  Exchange Act of 1934, as
amended (the "Exchange  Act").  Actual results may materially  differ from those
projected in the  forward-looking  statements  as a result of certain  risks and
uncertainties set forth in this report.  Although  management  believes that the
assumptions made and expectations  reflected in the  forward-looking  statements
are reasonable,  there is no assurance that the underlying  assumptions will, in
fact,  prove to be correct or that actual  future  results will not be different
from the expectations expressed in this report.

Item 1.  Description of Business

Overview

        Treasury  International,  Inc.  ("Treasury" or the "Company") engages in
the international  manufacturing,  sourcing and distribution of quality consumer
and  industrial  products.  The  Company's  plan is to become  an  international
manufacturing,  distribution and marketing conglomerate. To expand its business,
the Company seeks to make  acquisitions in niche  industries of companies having
strong brand  recognition  and/or  significant  market  share  and/or  marketing
capabilities,  with the intent of growing these businesses into leaders in their
respective markets.

        As  of  January  31,   1997,   the  Company   markets  and   distributes
non-pharmaceutical  branded  products and  manufactures  and markets  customized
plastic  containers  through its  indirect  wholly-owned  subsidiary,  Mega Blow
Moulding  Limited  ("Mega  Blow").  On February 25, 1997,  the Company  acquired
Silver 925, Inc. ("Silver"), which designs,  manufactures,  and distributes gold
and silver plated jewelry. As used in this report,  unless otherwise  indicated,
references  to  the  Company  shall  include  Silver,  Mega  Blow  and  Megatran
Investments Ltd., a wholly-owned  subsidiary of the Company ("Megatran"),  which
holds all of the capital  stock of Mega Blow.  Through these  subsidiaries,  the
Company  manufactures,  distributes  and  exports a combined  total of more than
3,000  products.  The  Company  has the  capacity  to provide  private  labeling
services for unique product specifications;  tailored packaging services for all
product lines; complete warehousing facilities; marketing services via a network
of marketing and sales  representatives;  and  specialized  multi-lingual  sales
associates.  By utilizing its  customized  computer  information  and production
systems, the Company strives at all times to ensure access to the broadest range
of quality products.

History

        The  Company  was  incorporated  in the State of  Delaware on August 18,
1995.  Following  its  formation,  the  Company  acquired  all of the issued and
outstanding  shares of J.J.A.M.P.  Treasury  International  Corp.  ("JJAMP"),  a
Canadian corporation based in metropolitan Toronto,  Ontario,  Canada. JJAMP was
organized  on  September  29,  1993 and until  August 17,  1995,  conducted  its
business under the name "Treasury  International."  The acquisition of JJAMP was
accomplished  through the issuance of 8,023,812  shares of the Company's  Common
Stock to JJAMP's stockholders.

        On  October  30,  1996,  the  Company  acquired  all of the  issued  and
outstanding common shares of Megatran,  a Canadian company based in metropolitan
Toronto,  Ontario,  Canada.  The  purchase  price for the  Megatran  shares  was
$2,863,182,  of which  $2,111,302  was paid in cash and the  balance was paid by
delivery of  debentures  in the original  principal  amount of  $751,880,  which
debentures are convertible into shares of the Company's Common Stock.

        Just subsequent to the fiscal year end, on February 25, 1997 the Company
acquired all of the outstanding  capital stock of Silver, a Florida  corporation
based  in  Miami,  Florida.  The  purchase  price  for  the  Silver  shares  was
$2,000,000,  which amount is payable in five annual installments of $400,000, of
which 90% of each annual  installment  is to be paid in shares of the  Company's
Common Stock and 10% of each annual installment is to be paid in cash.

         The Company's  principal executive offices are located at 7040 Tranmere
Drive,  Mississauga,  Ontario, Canada L5S 1L9, and its telephone number is (905)
673-1700.

                                     Page 2
<PAGE>

Corporate Summary and Growth Strategies

        The  Company  is  aggressively   pursuing  potential   acquisitions  and
strategic  alliances  which  management  believes would  significantly  increase
revenues, profits and value for its stockholders in accordance with its business
objectives.  The Company's  "Leveraged  Build-Out"  strategy  consists of growth
through internal  expansion of sales and profits in existing  operations through
an aggressive  acquisitions  program.  Businesses  targeted for acquisition must
meet or exceed management's stringent revenue and profit objectives.  Management
must also believe that the targeted corporations have outstanding North American
and  International  prospects  for rapid  growth in both top line  revenues  and
bottom line profits. Management is committed to expanding its global presence by
entering the emerging  markets within Latin America,  Eastern Europe and Africa.
In  furtherance  of  this  plan,  the  Company  anticipates  utilizing  existing
marketing  channels of the  acquired  companies.  Management's  objective  is to
obtain  additional  distribution  capacity,  gain market  share for its existing
product  lines and  diversify the products and services the Company can offer to
its expanding client base.

        In  addition to internal  growth and  acquisitions,  the Company is also
active in the  business  of creating  and  maintaining  international  strategic
trading  links.  The  purpose  of this  plan is to obtain  alternate  production
sources and new channels of marketing  and  distribution  for both  consumer and
industrial products in North America and, in particular,  the United States. The
Company is also  continually  attempting  to develop  and  implement  systems to
popularize  its products  through the  promotion of high quality  private  label
branded products at competitive prices.


The Company's Markets in General

        The  Company  believes  it can  achieve  widespread  acceptance  for its
products  in  developing  countries  where mass  consumption  of goods is in its
infancy.   Management  believes  the  Company  can  take  advantage  of  a  very
competitive global situation by delivering highly  knowledgeable and experienced
cultural liaisons that stand behind  internationally  recognized  products.  The
Company  should  then be able to maintain  an upward  momentum in world  markets
including the aggressive  penetration of important  emerging markets on a global
scale.

        These international  businesses involve complex and dynamic processes of
political and economic  issues in addition to  traditional  issues of market and
firm related concerns.  For these reasons,  Treasury has pursued strategies that
include complementary  networks of culturally  experienced  individuals with the
principal objectives of growth and development through leveraged acquisitions.

        As a conglomerate, the Company does not face direct competition, however
the Company's subsidiaries directly compete in their respective industries;  see
"Industry  Segments"  below.  The Company's  success,  as measured against other
conglomerates, depends upon its ability to locate and acquire subsidiaries which
will complement its existing lines of business.

        Management believes that one of Treasury's major long term opportunities
is in Latin America. Latin America has a population of over 450 million and many
of its countries have  populations well in excess of those in Canada and Europe,
and has countries with large urban  populations and developing  economies.  With
the recent widespread move towards democratization of the region and development
of market oriented  economies,  experts predict positive future prospects in the
region.  In fact, the value of contemporary  foreign direct investment (debt and
equity  investment) in some Latin American  countries is almost twelve times the
size of levels  before the South  American  debt crisis in the 1980's.  The debt
crisis  created a  situation  where  consumers  had  little  access to  imported
products or services and little  ability to purchase  even if such  products had
been  available.  With the easing of this crisis,  these  markets are in need of
goods and services.  Similar  situations  are  developing in Eastern  Europe and
Africa which also present potential  opportunities for the Company. It is one of
Treasury's  major  objectives to expand its global presence by meeting the needs
in these "emerging  markets" whose rapid growth is fueling demand for industrial
and consumer products.


                                     Page 3
<PAGE>

Industry Segments

        The  following  is a summary of the  Company's  operations  by  industry
segment:

o       Customized Commercial Plastic Containers (Mega Blow Moulding Limited)

        Overview.  Since its  formation  in 1984,  Mega Blow has  operated  as a
specialized  custom  molder of plastic  bottles  and  containers  for use in the
pharmaceutical,   health  and  beauty,   household   cleaner  and  food  product
industries.  During  fiscal 1996,  Mega Blow's  revenues were  approximately  $7
million.  Approximately  one-half of Mega Blow's  revenues are  generated in the
United  States.  Mega Blow also has a strong market  presence in the Province of
Ontario,  Canada, which is the main manufacturing center in Canada. Plastic is a
disposable material which is in high demand in today's environmentally  friendly
and industrializing world. Management believes that demand will continue to grow
significantly  well into the next  century.  With an  estimated  market in North
America of over $15 billion for plastic products,  management believes that Mega
Blow is well positioned for growth.

        Customers.   Mega  Blow  concentrates  on  manufacturing   products  for
customers who are the end user or  manufacturer  agents.  Mega Blow has fostered
relationships with many major North American  corporations,  including Johnson &
Johnson,  G.K.  Packaging,  Fenton Webber,  Novo Pharm,  Jones Packaging and the
Canadian shampoo division of L'Oreal.  Management believes that Mega Blow has an
excellent  reputation for quality and customer  service and prides itself on its
ability to  consistently  maintain a zero percent defect rate. This has resulted
in long-standing customer relationships, many in excess of 10 years.

        Facilities/Equipment.  Mega Blow operates  from a leased,  46,000 square
foot manufacturing facility in metropolitan Toronto,  Canada. Mega Blow operates
nine Bekum blowing machines. The Bekum machine is considered by industry experts
to be the best  currently  available  and  gives  Mega  Blow a  state-of-the-art
manufacturing  capacity.  The Bekum machine can be operated almost  indefinitely
when  properly  maintained  and  updated.  All  machines  are  computerized  and
controlled  by special  tracking  devices  which  monitor all aspects of machine
productivity.  Further,  Mega Blow's computerized systems give the manufacturing
process  numerous  diagnostic  features which maximize  productivity and quality
control.  All manufacturing  machines are constantly  serviced and maintained to
the highest degree possible by a specially trained  maintenance staff as well as
by 24 hour  on-call  maintenance  professionals.  Mega  Blow  seeks to  maximize
productivity  and  utilization of fixed overhead costs by operating the plant 24
hours a day with four shifts.

        Personnel. Mega Blow employs more than one hundred non-unionized regular
employees  including  production,  management,  foremen and office  staff.  Mega
Blow's management is experienced in every facet of operations  including machine
operation, machine repairs and maintenance, completing setups, mold maintenance,
purchasing, distribution and marketing. A majority of Mega Blow's staff has been
with the Company since its inception and has grown and been promoted over time.

        Materials.  Mega  Blow's  major  raw  material  usage  consists  of  the
following resins: Pet G, H.D.P.E.  (High Density Polyethylene) and L.D.P.E. (Low
Density Polyethylene).  Management is not aware of any environmental concerns in
respect of Mega Blow, its  manufacturing  facilities or its products.  Mega Blow
presently  uses six  major  suppliers  of the above  resins.  Mega Blow has been
dealing with each of its major  suppliers for over ten years.  In the event that
its existing  sources of supply are  insufficient  to meet its  existing  needs,
management believes that alternative  supplies would be available at competitive
prices  from  one of its  other  major  suppliers  or from  outside  alternative
suppliers not currently engaged by Mega Blow.

        Growth Strategy.  Treasury intends to increase Mega Blow's  sales,
market share and profitability by employing three strategic initiatives:

    o   A strategic acquisition program in this very fragmented market
    o   Streamlining existing manufacturing operations
    o   Making high return capital expenditures to increase Mega Blow's
          production output and efficiency

o   Gold and Silver Jewelry (Silver 925 Inc.)


                                     Page 4
<PAGE>

        General.  Silver,  formed in 1986, designs,  manufactures,  markets, and
distributes  gold  and  silver  plated  jewelry.  Silver's  1996  revenues  were
approximately $9.1 million.  Management  believes that Silver has an established
international reputation for high quality and innovatively designed jewelry with
high level  after-sales  customer  services.  Silver's  products are advertised,
reviewed and  profiled on national  television,  and in  magazines  and consumer
trade catalogues.  Within the $13 billion jewelry industry,  the gold and silver
plated sector has enjoyed  unprecedented  growth due to large demand for jewelry
with high perceived value.

        Silver specializes in the silver/gold plated "bridge" jewelry segment of
the industry. This segment has undergone and continues to show tremendous growth
due  to  increasing   consumer  demand  for  high  perceived   value,  low  cost
merchandise. The Company believes that Silver's closest competitor has a limited
sales and marketing  force and no in-house  production  or design  capabilities.
Management  believes  that Silver has a unique  competitive  advantage as it has
differentiated  itself  from its  competitors  by its  unique  designs,  quality
fabrication,  ability to cater to specific customer requirements through its own
in-house  design  staff,  after-sale  customer  service  and  its  unconditional
lifetime warranties on products for key customers.

        The Company believes that Silver offers quality,  service and styling to
a  wide  range  of  customers.  The  emphasis  is  on  product  development  and
flexibility  in product design for major  retailers who are new product  driven,
while at the same time having the ability to quickly  bring  products to market.
To complete the Company's exclusive customer services,  it offers  unconditional
lifetime warranties on specific products.

        Silver also builds product recognition, image and excitement through the
promotion and customer support of its products in regional and national markets.
Silver's  "celebrity"   marketing  division  is  responsible  for  creating  and
marketing  products  for such  famous  personalities  as  Suzanne  Somers  (Home
Shopping Network) and Elizabeth Taylor (Avon).  Silver intends to expand in this
area as celebrity  marketing has proven to be an extremely effective and popular
vehicle for the sale of bridge jewelry.

        For the fiscal year ended July 31, 1996, Silver had  approximately  $9.1
million in annual  sales.  Silver's  annual  sales over the past five years have
increased by  approximately  82%. The current market  breakdown of sales for the
1996 fiscal year by geographic region is as follows:

               o      United States     78%
               o      Canada            10%
               o      Europe            10%
               o      Latin America      2%

        Customers.  Silver markets its products throughout the United States and
internationally   to  some  of  the  best  known  major  retail   chains,   mass
merchandisers,  catalogue outlets and independent  jewelry stores.  Silver has a
customer base of over 500 major and independent active accounts  purchasing over
2,500 products, and sells to well known clients,  including Bloomingdales,  J.C.
Penney,  Macy's,  Q.V.C.  Network,  Service  Merchandise  Catalogues,  the  Home
Shopping Network, American Airlines, Avon Products, Seta and T.J. Maxx. Sales to
major retailers account for 80% of Silver's total revenues.

        Manufacturing.  Silver  operates out of a leased 6,800 square foot
facility in Miami, Florida.  This  facility  serves as head office, manufactur-
ing and distribution center and warehouse.

        Personnel. Silver employs more than 40 people in its non-unionized Miami
location  and  utilizes  more than 600  contract  workers for most facets of its
production,  which is done  primarily  in Bangkok,  Thailand.  The Thai  jewelry
production  industry is, at present time, not  significantly  impacted by either
governmental  or industry  regulations  and  management  does not anticipate any
future changes in this environment.

        Materials.  Management believes that there is sufficient availability of
the necessary raw materials to produce  Silver's  jewelry  products by accessing
the world  markets  for gold,  silver  and gem  stones.  Silver has been able to
secure all its  necessary  material  inputs at  competitive  prices.  Management
believes  that should  severe price  shocks  affect any of Silver's raw material
sources,  it will be able to  adjust  its  finished  product  pricing  structure
accordingly  by  maintaining  accurate  and timely  inventory  levels  using its
computerized inventory control systems.

                                     Page 5
<PAGE>

        Growth Strategy. Treasury's management considers the existing fragmented
industry  structure  ideal for its  Leveraged  Build-Out  strategy  and plans to
increase market share employing the following key strategies:

    o Using its Leveraged Build-Out strategy to make aggressive key acquisitions
    o Establish  Silver as an  aggressive  marketer of high quality silver/gold
        plated  jewelry in the  United  States  and  abroad 
    o Improve the in-house marketing team and outside company sales force 
    o Maintain optimal inventory levels to ensure timely response and  adequacy
        of supply 
    o Improve and diversify Silver's marketing and distribution strategies

        Additionally,  based on extensive  market  research,  Silver's  southern
Florida base of operations and Silver management's  multi-lingual abilities, the
Company believes that potential sales to Latin America,  Africa and Europe offer
excellent growth opportunities. Further, the Company intends to improve Silver's
profitability  with an  aggressive  program of  streamlining  and  reengineering
operations to reduce production and overhead costs and increase productivity and
sales response time.

Government Approvals and Licenses

        The Company has sought legal and  technical  expertise to ensure that it
and  its  suppliers,  distributors  and  independent  associates  have  all  the
necessary government approvals, licenses, permits and certificates.

Currency, Foreign Exchange and Banking

        As most of the Company's  operations  have been based primarily in North
America,  the Company  believes that the current  exchange rate  environment has
been  favorable to it and as such has not  undertaken  active  foreign  exchange
hedging  activities.  Management monitors world exchange conditions on a regular
basis and should the  current  favorable  environment  change,  management  will
implement a more active foreign currency hedging policy.

Research and Development Costs

        During its last two fiscal  years,  the Company has incurred no material
expenditures on account of research and development as management  believes that
the  success  of the  Company  and  its  business  operations  did  not  require
significant research and development efforts.

Employees

        As of July 17,  1997,  the  Company  has five  full time  officers  and,
including its subsidiaries,  141 employees.  Many of these employees are able to
communicate  fluently  in  one or  more  of the  following  languages:  English,
Spanish,  Portuguese,  French,  Italian,  Arabic and Hebrew.  This  multilingual
capacity  will  significantly  assist the  Company in  penetrating  the  world's
emerging foreign markets.  None of the Company's  employees are represented by a
labor  union or is subject to a  collective  bargaining  agreement.  The Company
considers its relations with its employees to be good.

Investment Policies

        The Company has no limitations on the amounts which it may invest in any
one  investment  or type of  investment.  The  Company  has no  holdings in real
estate,  real  estate  mortgages  and  similar  securities  or  publicly  traded
securities.  As well,  the Company  does not have any  investment  in persons or
companies  primarily devoted to such investments and it is not the policy of the
Company to make  investments  for the purpose of capital gain or passive income.
Presently, all available monies are being used for day-to-day operations.

Patents and Trademarks

        Due to the nature of Treasury's  operations,  it does not currently hold
any existing or pending  patents or trademarks  outside of the Company's and its
subsidiaries' names.

International Operations

        Foreign business is conducted through subsidiaries,  representatives and
distributors,  and, to a lesser extent, by direct sales.  International revenues
accounted for approximately  52% of consolidated  total revenues in fiscal 1997,
and  90% of  consolidated  total  revenues  in  fiscal  1996.  The  majority  of
Treasury's international revenues are derived from Canada and Latin America. See
note 13 to the January 31, 1997 year end financial  statements  (the  "Financial
Statements").  In  view  of the  location  and  diversity  of its  international
activities, the Company does not believe that there are any special risks beyond
normal risks of uncertainty attendant to doing business abroad.



                                    Page 6
<PAGE>

Item 2.  Properties

        The Company leases 46,000 square feet of space in Mississauga,  Ontario,
Canada as administrative  offices and manufacturing  facilities at a rental rate
of  Can$4.75  per square  foot per year.  The current  lease  period  expires on
December 31, 1998, with an option to renew until December 31, 2003. In addition,
Silver leases a 6,800 square foot  manufacturing and  admnistrative  facility in
Miami  Florida  at a base rate of $5,000  per month plus  certain  pass  through
expenses, which lease expires in October 2001.

Item 3.  Legal Proceedings

      The Company is not currently  engaged in any legal  proceedings and is not
aware of any pending or threatened litigation that could have a material adverse
effect on the Company's business, financial condition or results of operations.

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

        None.


                                     PART II

Item 5.  Market For Common Equity and Related Stockholder Matters

      In December  1995,  the Company's  Common Stock  commenced  trading on the
NASDAQ "pink  sheets"  under the symbol  "TREY." On April 12,  1996,  the Common
Stock of the  Company was  approved  for  trading on the  NASDAQ-OTC  Electronic
Bulletin Board. The following table sets forth the range of high and low closing
representative  bid prices for the Company's  Common Stock from April,  30, 1996
through January 31, 1997 (as reported by NASDAQ),  which represent  inter-dealer
prices,  without  retail  mark-up,  mark-down or commission  and may not reflect
actual transactions:

Quarter Ended                               High Bid      Low Bid
-------------                               --------      -------
January 31, 1996                             $1.13         $0.30
April 30, 1996                                0.50          0.25
July 31, 1996                                 1.31          0.50
October 31, 1996                              1.07          0.19
January 31, 1997                              0.44          0.16

        As of July 17, 1997,  there were 104 holders of record of the  Company's
Common  Stock.  The Company has not  declared or paid any cash  dividends on its
Common Stock since its inception,  and its Board of Directors  currently intends
to retain all earnings for use in the business for the foreseeable  future.  Any
future  payment  of  dividends  will  depend  upon  the  Company's   results  of
operations,  financial  condition,  cash  requirements  and other factors deemed
relevant by the Company's Board of Directors.

      The Company has undertaken the following  unregistered sales of its Common
Stock.  All of the  following  sales were exempt from  registration  pursuant to
Sections 3(b) and 4(2) of the  Securities  Act and  Regulation D or Regulation S
promulgated by the Securities Exchange  Commission (the "SEC") thereunder.  None
of the following  unregistered  sales involved  underwriters,  and there were no
underwriting discounts or commissions.

<TABLE>
<S>                                 <C>                     <C>          <C>
                                    Person or Class of
                                          Persons           Number of    Total Cash Price or
Date, Title of Securities Sold         to Whom Sold           Shares        Consideration

July 19, 1996, Common Stock       George B. Sukornyk            500,000         $99,000

July 19, 1996, Common Stock       Yaachov Azagury               500,000         $99,000

</TABLE>


                                     Page 7
<PAGE>


Item 6.  Management's Discussion and Analysis or Plan of Operation

Overview

        Treasury is an international  manufacturing,  distribution and marketing
company with subsidiaries  producing over 3,000 consumer and industrial products
primarily for North American markets.  Once solely an international  distributor
of 225 consumer products,  Treasury's acquisition of Mega Blow more than doubled
annual sales to over $2 million for the fiscal year ended January 31, 1997. With
the  acquisition  of  Silver,  on  a  pro  forma  basis,  the  Company  projects
significantly  higher  revenues for the fiscal year ending January 31, 1998. The
comparison set forth below does not give effect to the  acquisition of Silver in
February, 1997.

        Total  assets  increased  548% to almost $4 million from the 1996 fiscal
year to  fiscal  1997  with the  October  1996  acquisition  of Mega  Blow.  The
Company's  total  assets   increased  to  an  estimated  $6  million  after  the
consummation of the Silver acquisition in February, 1997.

        During the next 24 to 36 months,  Treasury  will  continue to pursue its
expansion goals via its Leveraged  Build-Out  strategy.  To increase its current
subsidiaries'  market  share,  the Company plans to acquire key  competitors  or
companies having important synergy's with existing company  operations.  Current
operations  are also  planned  to be  streamlined  in order to reduce  costs and
improve quality and  productivity.  Furthermore,  Treasury intends to expand its
global presence by entering the rapidly  industrializing  and emerging  markets,
including the key economies in Latin America, Eastern Europe and Africa.

        The  following  discussion  should  be  read  in  conjunction  with  the
Consolidated  Financial  Statements  of the  Company  included  with this annual
report.

Fiscal 1997 Compared to Fiscal 1996

        Net sales  increased  during  fiscal  year 1997 to  approximately  $2.12
million,  up  approximately  91% from $1.1  million  in fiscal  year  1996.  The
increase in net sales also  reflects  the  inclusion  of Mega Blow for the three
months  ended  January  31, 1997 (67%).  The Company  experienced  a net loss of
$1,032,084  for  its  fiscal  year  ended  January  31,  1997,  an  increase  of
approximately  99.8% when  compared to the Company's net loss of $516,656 in the
fiscal year ended January 31, 1996.  Among the  significant  items impacting the
1997 results were  increased  expenses  resulting  from the Mega Blow and Silver
acquisitions  as  well  as  extensive  marketing  and  consulting   arrangements
undertaken by the Company.

        The cost of sales for  fiscal  1997  represented  82% of net  sales,  or
$1,743,380, a 161% increase compared to 60% of net sales, or $667,083, in fiscal
1996. The increase is attributable to the write-down of obsolete and slow-moving
inventories,  higher prices of raw  materials,  increased  sales of lower margin
products and, to a lesser extent, pricing incentives to major customers.

        Operating,  general and administrative expenses increased in fiscal 1997
to  $1,151,128,  or  approximately  54%  of  sales,  compared  to  $957,607,  or
approximately  86% of sales, in fiscal 1996. The increase is attributable to the
write-off of uncollectible accounts receivable,  expenses related to the October
30, 1996 acquisition of Mega Blow, expenses related to the acquisition of Silver
which was consummated  subsequent to year end, consulting services rendered (see
note 15 of the Financial Statements) and marketing and promotion activities.

Liquidity and Capital Resources

        The primary  sources of liquidity for the Company are funds generated by
operations  and  borrowings  under  the  Company's  loan  agreement.  Additional
information on the loan agreement is described in notes 6 and 7 to the Company's
Financial Statements.

        In August 1995, the Company issued  2,750,000  shares of Common Stock to
five private  investors  for an aggregate  cash price of $275,000  pursuant to a
private  placement  offering.  From August  through  November  1995, the Company
issued  1,449,878  shares of Common  Stock for an  aggregate  price of  $724,794
pursuant  to a  private  placement  offering.  Each  of  the  private  placement
offerings was made pursuant to an exemption from  registration  provided by Rule
504 of Regulation D promulgated under the Securities Act of 1933, as amended.



                                     Page 8
<PAGE>

        In July,  1996, the Company issued  1,000,000  shares of Common Stock to
two  individuals  for an aggregate  cash price of  $198,000.  See Item 5 of this
report.

        In October,  1996,  the Company sold 0%  Convertible  Debentures  in the
aggregate  principal  amount of $1,000,000  due October 29, 1997 and October 30,
1999,  respectively.  In the same  month,  the  Company  also  sold an 8% Senior
Subordinated  Convertible  Debenture in the  principal  amount of $500,000,  due
October 29, 1997. As of July 16, 1997, the holder of the 8% Debenture elected to
convert the  outstanding  amount of such  Debenture into shares of the Company's
Common  Stock.  The sales of the  Debentures  were made pursuant to an exemption
from registration  provided by Regulation S promulgated under the Securities Act
of 1933.

        As of January 31, 1997,  current assets totaled  $1,348,995  compared to
$592,605 at January 31, 1996. The increase was  attributable to the inclusion of
Mega Blow's current assets of $1,258,662 at January 31, 1997. At fiscal year end
1997,  the Company had no cash and short-term  deposits  compared to fiscal 1996
cash and short-term deposits of $292,611.  The cash and short-term deposits were
used for expenses related to the acquisitions undertaken by the Company.

        As of January 31, 1997, current  liabilities totaled $2,561,147 compared
to $49,317  as of  January  31,  1996.  The  increase  was  attributable  to the
inclusion of Mega Blow's current  liabilities of $1,405,067 at January 31, 1997,
higher levels of trade payables reflecting business growth, a current portion of
long-term debt of $1,147,812 and current bank  indebtedness of $394,407 incurred
to finance both the Company's  acquisition of Mega Blow and accounts receivable,
as  discussed  in  note  6  to  the  Company's  Financial  Statements.  Accounts
receivable  totaled  $812,357  at fiscal  year end 1997  compared to $180,304 in
fiscal  year  1996,  an  increase  principally  attributable  to the  Mega  Blow
acquisition.

        As of January  31,  1997,  Mega Blow had  outstanding  $950,393  in term
loans,  which loans are secured by a first  priority  lien on the assets of Mega
Blow and the personal guarantee of James Hal, the Company's president.  The term
loans are due on October 30, 2003. The Company also has  outstanding  $1,501,880
principal amount of convertible debentures, due as follows:  $1,000,627 in 1998;
$250,627 in 1999; and $250,626 in 2000. All the debentures are convertible  into
shares of the Company's  Common Stock at the option of the holder.  In the event
the holders  convert these  debentures,  the  Company's  obligation to repay the
$1,501,880 indebtedness would be eliminated.

        The Company has a foreign  exchange  rate risk related to  international
earnings and cash flows. Management anticipates that, in future, the Company may
enter into forward foreign exchange contracts and purchase currency options tied
to  the  economic  value  of  receivables,  payables  and  expected  cash  flows
denominated in non-local foreign currencies should the need arise.

        The Company believes it will generate sufficient positive cash flow from
operations  to meet  its  operating  requirements  for the next  twelve  months.
However,  there can be no  assurance  that the Company will be able to repay the
debentures that mature in 1997 if they are not converted. If the funds available
under the  Company's  financing  agreements,  together with its current cash and
cash  equivalents  are not  sufficient  to meet the  Company's  cash needs,  the
Company may, from time to time, seek to raise capital from  additional  sources,
including  extension  of  its  current  lending   facilities,   project-specific
financings and additional public or private debt or equity financings.

Item 7.  Financial Statements

        The financial  statements of the Company,  including the notes  thereto,
together with the report of Bromberg & Associate,  independent  certified public
accountants thereon, are presented beginning at page F1.


Item 8.  Changes In and Disagreements with Accountants on Accounting and
         Financial Disclosure

         None.


                                     Page 9
<PAGE>


                                           PART III

Item 9.  Directors, Executive Officers, Promoters and Control Persons; 
         Compliance with Section 16(a) of the Exchange Act

        The following  table  provides  information  concerning  each  executive
officer and director of the Company.  All  directors  hold office until the next
annual meeting of Stockholders  or until their  successors have been elected and
qualified.

        NAME                          AGE              TITLE

   Mr. James Hal
  (a.k.a. James Halioua)              34               Chairman of the Board
                                                       Chief Executive Officer
                                                       President and Director

   Mr. Howard Halpern                 37               Chief Financial Officer
                                                       Executive Vice President

   Mr. Mark Halioua                   42               Director

   Mr. Robert Abourmad                45               Director

        Mr. Hal has been Chairman of the Board,  Chief Executive Officer and a 
Director of the Company  since its inception in August 1995.  Mr. Hal was the  
President and Chief Financial Officer of JJAMP from its inception in September
1993 through  acquisition  by the Company in August 1995.  From 1983 to 1993,
Mr. Hal was the  President of  Tropi-Golf  Inc. of Concord, Canada.  He was  
previously a Director for Gaming Lottery  Corp., a company trading both on
the NASDAQ and on the Toronto Stock Exchange,  and Le Print Express,  Inc. 
which trades on the Canadian Dealer Network (CDN).

        Mr. Halpern,  a certified  public  accountant,  has been Chief Financial
Officer and Executive Vice President of the Company since January 15, 1997. From
1989 until July 1992, he was the Controller of Merisel Canada,  Inc., a computer
wholesaler  with  approximately  $208,000,000  of annual sales and 70 employees.
Since July 1992 he has practiced as a sole  proprietor  Chartered  Accountant in
Canada, providing tax, financial and management consulting services.

        Mr. Abourmad has been a Director of the Company since August 18, 1995.
From 1995 to present he has been the President of Payless Locksmith, Inc. of 
Toronto, Canada.

        Mr. Mark  Halioua has been a Director  of the Company  since  August 18,
1995. Since August 1988, he has been the President of National Printing Group in
Markham, Canada, a printing company. He possesses no other directorships.

        Mr. James Hal and Mr. Mark Halioua are brothers.

        Section  16(a) of the Exchange Act requires the  Company's  officers and
directors,  and persons who own more than ten percent of a  registered  class of
the  Company's  equity  securities,  to file reports of ownership and changes in
ownership  with  the SEC.  Officers,  directors  and  greater  than ten  percent
shareholders  are required by SEC  regulation to furnish the Company with copies
of all Section 16(a)  reports they file.  Based solely on a review of the copies
of such reports  furnished  to the Company  during or with respect to the fiscal
year ended  January 31, 1997,  or written  representations  that no Forms 5 were
required,  the Company  believes  that during the fiscal year ended  January 31,
1997,  all  Section  16(a)  filing  requirements  applicable  to  its  officers,
directors and greater than ten percent  beneficial  owners were  complied  with,
except that each of the officers and  directors of the Company  named above have
not filed initial statements of beneficial ownership and James Hal has not filed
two  reports on Form 4 regarding  grants of options  and Howard  Halpern has not
filed one report on Form 4 regarding grants of options.

Item 10.  Executive Compensation

Summary Compensation Table

      The following table sets forth the  compensation for each of the Company's
fiscal years since  inception  for (i) the  Company's  Chief  Executive  officer
during the fiscal  year ended  January  31,  1997 and (ii) each other  executive
officer of the Company whose  compensation  during the fiscal year ended January
31, 1997 exceeded $100,000.

                                    Page 10
<PAGE>

<TABLE>
<S>          <C>     <C>       <C>      <C>     <C>     <C>          <C>          <C>       <C>
                     ANNUAL COMPENSATION                    LONG TERM COMPENSATION
                                                                     Securities
                                                        Restricted   underlying             All Other
             Fiscal  Annual    Annual   Other   Annual  Stock        options      LTIP      Compen-sation
Name         Year    Salary    Bonus    Compensation    Awards       and SARs     payouts

James Hal    1997    $60,000   $49,000  NONE            NONE         2,500,000    NONE      NONE
James Hal    1996    $65,000   NONE     NONE            NONE         NONE         NONE      NONE
H. Halpern   1997         -    $49,000  NONE            NONE         2,500,000    NONE      NONE

</TABLE>

Stock Option Grants Table

        The following  table provides  information  with regard to stock options
granted to the persons named in the foregoing compensation table:

<TABLE>
                    <C>                    <C>              <C>               <C>
                                            % Total
                    Number of Securities    Options/SARs
                    Underlying              Granted to
Name of             Options/SARs Granted    Employees in    Exercise of
Grantee                                     Fiscal Year     Base Price        Expiration Date

James Hal           2,500,000               50%             $0.11             Jan. 31, 2008
Howard Halpern      2,500,000               50%             $0.11             Jan. 31, 2008

</TABLE>

        All of the options  granted to Mr. Hal were granted  independent  of the
Company's  stock option plan. The options were awarded in  consideration  of Mr.
Hal agreeing to personally guaranty a $750,000 debenture of the Company, and the
grant of such options was approved by the 2 disinterested directors on the Board
of Directors of the Company.

Directors' Compensation

      The Company's  policy is not to pay compensation to directors who are also
employees  of  the  Company  for  their  service  as  directors.   Additionally,
non-employee  directors do not presently receive  compensation for their service
as directors. The Company will, however,  reimburse directors a fixed amount for
out-of-pocket expenses incurred for attendance at meetings.

Item 11.  Security Ownership of Certain Beneficial Owners and Management.

      The following table sets forth  information with respect to the beneficial
ownership of the outstanding  Common Stock of the Company as of July 22, 1997 by
(i) each director of the Company, (ii) each executive officer of the Company and
each executive  officer of the Company named in the Summary  Compensation  Table
above,  (iii)  each  person  known by the  Company  to own  more  than 5% of the
Company's Common Stock and (iv) all directors and officers as a group:


                                    Page 11
<PAGE>

                                      Beneficial
                                      Ownership
                                   of Common Stock      Current Percent
   Name and Address                                        of Class
                                                             (1)
                                      11,500,006             51.2%
   James Hal (2)
   7040 Tranmere Drive
   Mississauga, Ontario
   Canada L5S 1L9

   Howard Halpern (2)                  7,500,000             33.4%
   160 Theodore Place
   Thornhill, Ontario
   Canada L4J 8E3

   Halpern Family Trust                4,000,006             26.8%
   650 Briar Hill Ave.
   Suite 301
   Toronto, Ontario
   Canada M5N 1N3

   Mark Halioua (3)                       20,700                 *
   147 Beverly Glen Blvd.
   Thornhill, Ontario
   Canada L4J 4Y2

   Robert Abourmad (4)                    20,300                 *
   87 Bayhampton Crescent          -------------
   Thornhill, Ontario
   Canada L4J 4Y2

   All directors, executive           23,041,012             76.8%
   officers and 5% owners, as a
   group:
                                   -------------

* Less than one percent.
-------------------------------

(1)     Computed on the basis of  14,942,566  shares of Common  Stock and,  with
        respect to those  persons  holding  options  to  purchase  Common  Stock
        exerciseable  within 60 days,  the number of shares of Common Stock that
        are issuable upon the exercise thereof.

(2)     Includes  options to purchase  7,500,000  shares of Common Stock  
        exerciseable within 60 days.

(3)     Includes  options to purchase 20,000 shares of Common Stock  
        exerciseable within 60 days and 300 shares of Common Stock owned by his
        wife.

(4)     Includes options to purchase 20,000 shares of Common Stock exerciseable
        within 60 days.



                                    Page 12
<PAGE>

Item 12.  Certain Relationships and Related Transactions

        In August 1995,  James Hal, the President and principal  stockholder  of
the Company  converted  an  aggregate of $71,267 in advances to the Company into
7,221,430 shares of the Company's Common Stock.


Item 13.  Exhibits, List and Reports on Form 8-K

        (a)  Index to Financial Statements
             Report of Independent Auditors
             Financial Statements
             Financial Data Schedule (filed electronically herewith)

Exhibits

3.1     Certificate of Incorporation of the Company, as amended*

3.2     By-Laws of the Company.*

4.1     Form of Junior 0% Convertible Subordinated Debenture due 
        October 30, 1999.**

4.2     Form of Series A Senior Convertible Subordinated Debenture due 
        October 29, 1997.**

4.3     Form of Series A Senior Convertible Subordinated Debenture due 
        October 29, 1997.**

10.1    Treasury International, Inc. 1995 Stock Option Plan.*

10.2    Share Purchase and Exchange Agreement dated August 18, 1995 between the
        shareholders of J.J.A.M.P. Treasury International Corp., J.J.A.M.P 
        Treasury International Corp., and Treasury International, Inc.*

10.3    Agreement  dated October 30, 1996 by and among  Treasury  International,
        Inc., William Sarantos,  Toula Sarantos,  Martin Maxwell,  Louis Chelin,
        Verne Chelin,  David Bereskin,  In Trust, Joseph Myers, Eleanor Maxwell,
        Berta Lenenfeld, Douglas Ferguson and Megatran Investments Ltd.***

10.4    Agreement  dated as of June 18, 1996, as amended,  by and among Treasury
        International,  Inc., Silver 925, Inc., Moche Bendayan, Solomon Bendayan
        and Edward Kozial.****

21.1    Subsidiaries of the Company.

23.1     Consent of Bromberg & Associate.



                                    Page 13
<PAGE>


27.1     Financial Data Schedule.

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

    *   Incorporated by reference from, the Company's  Registration Statement on
        Form  10-SB,  as amended,  originally  filed with the SEC on October 21,
        1996.

   **   Incorporated by reference from, the Company's  Quarterly  Report on Form
        10-QSB, as filed with the SEC on December 20, 1996.

  ***   Incorporated  herein by reference from, the Company's  Current Report on
        Form 8-K, as filed with the SEC on November 21, 1996.

 ****   Incorporated  herein by reference from, the Company's Current Report
        on Form 8-K, as filed with the SEC on March 17, 1997.

         (b)   During the three month period ended January 31, 1997, the Company
               filed the following reports on Form 8-K:

               On November  21,  1996,  the  Company  filed a report on Form 8-K
               reporting on Item 2 that it had  acquired all of the  outstanding
               stock of Megatran Investments, Ltd.

               On January 13, 1997 the Company  filed an amendment to its report
               on Form 8-K reporting on Item 7 the audited financial  statements
               of Megatran Investments, Ltd.


                                    Page 14
<PAGE>


                                   SIGNATURES

        In accordance  with Section 13 or 15(d) of the Exchange Act of 1934, the
registrant  caused  this  report to be signed on its behalf by the  undersigned,
thereunto duly authorized.

                                            TREASURY INTERNATIONAL, INC.


                                            By:    /s/ James Hal
                                                   President and Chief 
                                                   Executive Officer

                                            By:    /s/ Howard Halpern
                                                   Chief Financial Officer


        Pursuant to the  requirements  of the Exchange Act, this Report has been
signed below by the following persons on behalf of the Company in the capacities
and on the date indicated.

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

/s/ James Hal          President and Chief Executive            July 28, 1997
                       Officer and Director

/s/ Howard Halpern     Chief Financial Officer                  July 28, 1997

/s/ Mark Halioua       Director                                 July 28, 1997

/s/ Robert Abourmad    Director                                 July 28, 1997



                                    Page 15
<PAGE>

                          TREASURY INTERNATIONAL, INC.
                        CONSOLIDATED FINANCIAL STATEMENTS
                                JANUARY 31, 1997



                                    CONTENTS


        AUDITORS' REPORT............................................... F1


        CONSOLIDATED BALANCE SHEET..................................... F2


        CONSOLIDATED STATEMENT OF DEFICIT.............................. F3


        CONSOLIDATED STATEMENT OF OPERATIONS........................... F4


        CONSOLIDATED STATEMENT OF CHANGES IN
        SHAREHOLDERS' DEFICIENCY....................................... F5


        CONSOLIDATED STATEMENT OF CASH FLOWS........................... F6


        NOTES TO CONSOLIDATED FINANCIAL STATEMENTS..................... F7


                                    Page 16
<PAGE>


                                AUDITORS' REPORT

Board of Directors and Shareholders
Treasury International, Inc.


     We have audited the consolidated balance sheets of Treasury  International,
Inc.  as at  January  31,  1997 and 1996,  and the  consolidated  statements  of
operations,  deficit, shareholders' deficiency and cash flows for the years then
ended.  These  consolidated  financial  statements are the responsibility of the
corporation's  management.  Our responsibility is to express an opinion on these
consolidated financial statements based on our audits.

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

     In our opinion,  these consolidated financial statements present fairly, in
all material  respects,  the financial position of the corporation as at January
31, 1997 and 1996 and the results of its  operations  and its cash flows for the
years then ended in conformity with generally accepted accounting principles.

 
                                                  CHARTERED ACCOUNTANTS

                                    Page F1

<PAGE>


TORONTO, CANADA
June 16, 1997

                          TREASURY INTERNATIONAL, INC.
                           CONSOLIDATED BALANCE SHEET
                             AS AT JANUARY 31, 1997

<TABLE>
<S>                                                           <C>                <C>
ASSETS
                                                                  1997             1996
CURRENT
     Cash and short-term deposits                            $      ---         $  292,611
     Accounts receivable                                         812,357            180,304
     Inventories (Notes 2 and 4)                                 385,915            117,838
     Sundry assets                                               144,541              1,852
     Income taxes receivable                                       6,182                ---
                                                               _________         __________
                                                               1,348,995            592,605

GOODWILL                                                       1,835,918                ---

CAPITAL ASSETS (Notes 2 and 5)                                   723,299             10,972
                                                               _________         __________
                                                              $3,908,212         $  603,577
 
                                         LIABILITIES
CURRENT
     Bank indebtedness (Note 6)                               $  394,407         $      ---
     Accounts payable and accrued liabilities                  1,018,928             49,317
     Current portion of long-term debt                         1,147,812                ---
                                                              __________          _________
                                                               2,561,147             49,317

DEFERRED INCOME TAXES                                             54,161                ---
 
LONG-TERM DEBT (Note 7)                                        1,304,461                ---
                                                               _________          _________
                                                               3,919,769             49,317

</TABLE>
 
                            SHAREHOLDERS' DEFICIENCY
<TABLE>

<S>                                                           <C>                <C>
SHARE CAPITAL
        Authorized
               30,000,000 common shares at $.0001

        Issued
               14,942,566 common shares                            1,494             1,222
 
        Contributed surplus (Note 9)                           1,543,861         1,077,866

DEFICIT                                                       (1,556,912)         (524,828)
                                                               _________         _________
 
                                                                 (11,557)          554,260
                                                               _________         _________
                                                              $3,908,212         $ 603,577
</TABLE>

APPROVED ON BEHALF OF THE BOARD
                                                           
                                                                
/s/ James Hal, Director                 /s/ Robert Abourmad, Director



                                    Page F2
<PAGE>

                          TREASURY INTERNATIONAL, INC.
                        CONSOLIDATED STATEMENT OF DEFICIT
                           YEAR ENDED JANUARY 31, 1997
 
                                        1997             1996

Balance, beginning of year         $  (524,828)      $   (8,172)

Net loss for the year               (1,032,084)        (516,656)

Balance, end of year               $(1,556,912)      $ (524,828)
 
        
                                     Page F3

<PAGE>


                          TREASURY INTERNATIONAL, INC.
                      CONSOLIDATED STATEMENT OF OPERATIONS
                           YEAR ENDED JANUARY 31, 1997

<TABLE>

<S>                                                                                               <C>             <C>     
                                                                                                      1997            1996
REVENUE......................................................................................     $2,123,631      $1,110,736
                                                                                                  
COST OF GOODS SOLD ..........................................................................      1,743,380         667,083

GROSS PROFIT ................................................................................        380,251         443,653

EXPENSES

          Warehouse and factory                                                                      139,660            --
          General and administrative                                                                 956,086         957,607
          Selling and delivery                                                                        55,382            --

                                                                                                   1,151,128         957,607

LOSS FROM OPERATIONS  before undernoted items ...............................................       (770,877)       (513,954)

                    Management fees                                                                  193,316            --
                    Financial                                                                         31,390            --
                    Amortization ............................................                         39,941           2,702

                                                                                                     264,647           2,702

LOSS  before income taxes ...................................................................     (1,035,524)       (516,656)

Provision for income taxes (recovery) .......................................................         (1,542)           --
Deferred income taxes (recovery) ............................................................         (1,898)           --

                                                                                                      (3,440)           --

NET LOSS.....................................................................................   $ (1,032,084)    $  (516,656)

Loss per common share .......................................................................   $      (0.08)    $    (0.04)

Weighted average number of
        common shares outstanding ...........................................................     13,221,096      12,223,690

</TABLE>

                                    Page F4
<PAGE>


                          TREASURY INTERNATIONAL, INC.
          CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' DEFICIENCY
                           YEAR ENDED JANUARY 31, 1997


                                               ISSUED SHARE     CONTRIBUTED
                                                 CAPITAL          SURPLUS  
                                               ____________     ___________

Issued 8,023,812 shares of common
stock in exchange for the assets
and liabilities of J.J.A.M.P 
Treasury International Corp. 
in August 1995                                    $     802    $   78,347

Issued 4,199,878 shares of common
stock in connection with a
private placement offering                              420       999,519
                                                   ________     _________
Balance - January 31,1996
                                                      1,222     1,077,866

Issued 1,000,000 shares of
common stock  with a private
placement offering                                      100       197,900

Issued 800,000 shares of
common stock as per stock option
plan (Note 14)                                           80        39,920

Issued 635,000 shares of
common stock for consulting
services (Note 15)                                       64       131,686


Issued 283,876 shares of
common stock to former shareholders
of Mega Blow Moulding Limited (Note 16)                  28        96,489
                                                   ________    __________

Balance - January 31, 1997                         $  1,494    $1,543,861
                                                   ========    ==========


                                    Page F5


<PAGE>

                          TREASURY INTERNATIONAL, INC.
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                           YEAR ENDED JANUARY 31, 1997

<TABLE>
<S>                                                                             <C>             <C>       

                                                                                       1997           1996
Cash flows from operating activities

     Net loss                                                                   $(1,032,084)    $ (516,656)

     Adjustments to reconcile net
     loss to net cash used in
     operating activities

     Increase in deferred income taxes                                                54,161           ---
     Amortization                                                                     39,941         2,702
     Increase in accounts receivable                                                (632,053)     (111,955)
     Increase in income taxes receivable                                              (6,182)          ---
     Increase in inventories                                                        (268,077)      (38,342)
     Decrease (increase) in sundry assets                                           (142,689)          627
     Increase (decrease) in accounts payable                                         969,611       (52,248)
                                                                                   ________       ________
Net cash used in operating activities                                             (1,017,372)     (715,872)

Cash flows from financing activities

     Long-term debt                                                                2,452,273           ---
     Advances by shareholders                                                            ---       (71,267)
     Proceeds on issue of common shares                                              466,267     1,079,044
                                                                                   _________     _________

Cash provided by financing activities                                              2,918,540     1,007,777

Cash flows from investing activities

     Goodwill                                                                     (1,835,918)          ---
     Purchase of capital assets                                                     (752,268)       (2,695)
                                                                                  ___________    __________

Cash used for investing activities                                                (2,588,186)       (2,695)
                                                                                  ___________    __________
Decrease (increase) in cash and
       short-term deposits                                                          (687,018)       289,210

Cash and short-term deposits,
       beginning of year                                                             292,611          3,401
                                                                                  ___________    __________

Cash and short-term deposits
     (bank indebtedness)
      end of year                                                                $  (394,407)   $   292,611
                                                                                 ============   ===========
</TABLE>
                                    Page F6

<PAGE>

                          TREASURY INTERNATIONAL, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             AS AT JANUARY 31, 1997


1.      Nature of business

        Treasury International, Inc. is a holding company which through its
        wholly-owned subsidiaries, J.J.A.M.P Treasury International Corp.,
        Megatran Investments Ltd. and Mega Blow Moulding Limited, manufactures
        and distributes a variety of consumer and industrial products.  The 
        company was incorporated on August 18, 1995 in the state of Delaware.


2.      Summary of significant accounting policies

        (a)    Basis of consolidation

              These consolidated  financial  statements  include the  accounts
              of the company   and   its   wholly-owned   subsidiaries,    
              J.J.A.M.P. Treasury  International  Corp.,  Megatran  Investments
              Ltd.and Mega Blow Moulding Limited. 
          
        (b) Inventories

               Inventories are valued at the lower of cost (first-in, first-out
               method) and net realizable value.
 
        (c)    Capital assets

               Capital assets are recorded at cost less accumulated 
               amortization. 
                    Amortization is provided as follows:
                      Leasehold improvements  - straight line over term of lease
                      Machinery and equipment - 20% diminishing balance
                      Office equipment        - 20% diminishing balance
 

        (d)    Revenue recognition

               Revenue is generally recognized as customers are invoiced for 
               products shipped by the company.

        (e)    Loss per share

               Loss per share is calculated based on the weighted average 
               number of shares outstanding during the year of 13,221,096.

        (f)    Foreign currency translation

               Substantially all assets and liabilities of the company's foreign
               subsidiaries are translated at year-end exchange rates,  while
               revenue and expenses are  translated at exchange rates  prevail-
               ing during the year.  Adjustments for foreign currency  trans-
               lation fluctuations are included in net income.

                                    Page F7
<PAGE>

                          TREASURY INTERNATIONAL, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             AS AT JANUARY 31, 1997


         (g)   General

               These financial statements have been prepared in accordance with
               U.S. generally accepted accounting principles (GAAP), as they 
               relate to these financial statements.
 

3.      Business combination

     On  October  30,  1996,  the  company  acquired  100%  of  the  issued  and
outstanding  common shares of Megatran  Investments Ltd., parent company of Mega
Blow Moulding Limited.  The purchase price of $2,863,182 consisted of $1,361,302
cash and debentures of $1,501,880.

4.      Inventories

        Inventories consist of:                           1997       1996 

                  Raw materials                      $ 151,241   $     ---
                  Packaging                             24,345         ---
                  Finished goods                       210,329     117,838
                                                     _________   _________
               
                                                     $ 385,915   $ 117,838
                                                     =========   =========

5.      Capital assets
                                              January 31             January 31
                                                  1997                  1996   
                                     __________________________________________
                                              Accumulated      Net      Net
                                     Cost    Amortization  book value book value
                                    _____    ____________  __________ __________
Leasehold improvements .......   $    4,221        1,328   $    2,893   $   ---
Machinery and equipment ......    2,438,759    1,770,174      668,585       ---
Office equipment                    103,074       51,253       51,821     10,972
                                 $2,546,054    1,822,755   $  723,299   $ 10,972

6.      Bank indebtedness

        The bank indebtedness includes an operating loan due on demand of
        $218,978 and is secured by a registered general assignment of book
        debts and a general security agreement of Mega Blow Moulding Limited.

                                    Page F8
<PAGE>

                          TREASURY INTERNATIONAL, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             AS AT JANUARY 31, 1997

7.      Long term debt

        The long-term debt consists of term loans and three debentures payable.
        The term loans are secured by a registered general security agreement
        having a first charge over all assets other than real property of Mega
        Blow Moulding Limited.  The term loans bear interest at rates varying
        from 6.47% to bank prime plus 1.75%. One of the three debentures which
        is in the amount of $500,000 is subject to 8% interest.  The remaining 
        two are interest-free debentures.
 
        The term loans and debentures are payable as follows:


                Term loans         Debentures          Total

1998                $  147,185     $1,000,627     $1,147,812
1999                   154,158        250,627        404,785
2000                   161,594        250,626        412,220
2001                   169,527           ---         169,527           
2002                   177,989           ---         177,989
2003 and following     139,940           ---         139,940
                    __________    ___________     __________
                       950,393      1,501,880      2,452,273
Less current portion   147,185      1,000,627      1,147,812
                    __________    ___________     __________
                    $  803,208     $  501,253     $1,304,461
 

8.      Lease commitments

     The minimum rentals  payable by Mega Blow Moulding  Limited under long-
     term operating leases,  exclusive of certain operating costs for which the
     company is responsible, are approximately as follows:

                   1997                             $158,217
                   1998                              158,217
                   1999                              158,217
                   2000                              158,217
                   2001 and subsequent until expiry  158,217
                                                    ________
                                       
                                                    $791,085
                                                    ========

9.      Contributed surplus

     Contributed  surplus  represents the premium paid on the issuance of common
shares.
        
                            Page F9


<PAGE>

                          TREASURY INTERNATIONAL, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             AS AT JANUARY 31, 1997

10.     Income taxes
 
        The company has non-capital losses carry-forward for income tax 
        purposes amounting to approximately $1,340,00 expiring in various years
        through 2012. The potential benefits of these tax losses have not been 
        recorded in these financial statements.

11.     Significant business relationship

        The company made sales of $1,253,219 representing approximately 59%
        of total sales to two customers.

12.     Claims and lawsuits

        The company has no claims or lawsuits filed or pending against it.

13.     Segmented revenue information

        The company, through its subsidiaries, manufactures and distributes
        consumer and industrial products to Canada, South America and other 
        foreign jurisdictions.


     Geographic segments .............                   1997               1996

     Revenues:
     United States-Domestic ..............         $1,026,848         $  115,150

     Export sales:
     Canada ..............................            544,683            215,365
     Other foreign jurisdictions .........            552,100            780,221
                                                    _________         __________

                                                   $2,123,631         $1,110,736
                                                   ==========         ==========
14.   Stock options
 
     The  company adopted a stock option plan as at August 18, 1995 for which
     it has received 10,000,000 shares of common stock. Each stock option may be
     exercised  in whole or in part at any time  within  ten years of the option
     grant date at an exercise price equal to the per share fair market value of
     the company's common stock as at the time of the grant of the option.


                                    Page F10

<PAGE>

                          TREASURY INTERNATIONAL, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             AS AT JANUARY 31, 1997


15.     Consulting services
 
        The company has signed consulting agreements with various consulting
        and public relations firms.   Out of a total 1,435,000 common shares
        granted, 635,000 common shares were issued to the recipients.


16.     Mega Blow Moulding Limited

        The company issued  283,786 common shares to the former shareholders of
        Mega Blow Moulding Limited, in lieu of management fees owed by Mega Blow
        Moulding Limited.


17.     Subsequent event

        Subsequent to the year end, the company acquired  all of the issued
        and outstanding capital stock of Silver 925, Inc., a company which 
        manufactures and distributes jewellery products.  Silver 925, Inc. is 
        located in the state of Florida.

        The purchase price of $2,000,000, is payable in five annual instalments
        of $400,000, with each instalment payable 90% in common shares and 10% 
        in cash.

                                    Page F11
<PAGE>



                                    Page 17
<PAGE>

                                  Exhibit 21.1


J.J.A.M.P. Treasury International Corp.
Megatran Investments Ltd.
Mega Blow Moulding Limited
Silver 925, Inc.

                                  Exhibit 23.1

                       Consent of Independent Accountants

The Board of Directors
Treasury International, Inc.:


        We consent to the use of our report included herein and to the reference
to our firm in the 10-KSB.

                                                  Bromberg & Associate



                                    Page 18
<PAGE>