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

                                FORM 10-QSB
 
[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934

For the quarterly period ended        June 30, 1998
  
or

[ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES 
     EXCHANGE ACT OF 1934

For the transition period from        to     

Commission File Number:            0-27520

                             SDC International, Inc.
             (Exact name of registrant as specified in its charter)

          Delaware                                   75-2583767
(State or other jurisdiction of                   (I.R.S. Employer
incorporation or organization)                    Identification No.)

2065 Montgomery Street, Ft. Worth, FL         76107    
(Address of principal executive offices)    (Zip Code)  

                               (561) 882-9300
          (Registrant's telephone number, including area code)

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

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

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

Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of 
securities under a plan confirmed by a court.
Yes [  ]  No [  ]

                APPLICABLE ONLY TO CORPORATE ISSUERS

Common stock, par value $.001 per share: 3,819,119 shares outstanding as of 
June 30, 1998.

<PAGE>

                SDC INTERNATIONAL, INC.  AND SUBSIDIARY
                                  INDEX


PART 1 - FINANCIAL INFORMATION:

     ITEM 1 - CONSOLIDATED FINANCIAL STATEMENTS

        Consolidated Balance Sheets (Unaudited) June 30, 1998
        and December 31, 1997                                        1

        Consolidated Statements of Operations (Unaudited) 
        for the three months ended June 30, 1998
        and May 31, 1997                                             2

        Consolidated Statements of Operations (Unaudited) 
        for the six months ended June 30, 1998
        and May 31, 1997                                             3

        Consolidated Statement of Stockholders' Equity
        (Unaudited) for the six months ended June 30, 1998           4

        Consolidated Statements of Cash Flows (Unaudited)
        for the six months ended June 30, 1998
        and May 31, 1997                                             5

        Notes to Consolidated Financial Statements                 6 - 13

     ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
              CONDITION AND RESULTS OF OPERATIONS                 14 - 16

PART II - OTHER INFORMATION                                         18


<PAGE>    1

                    SDC INTERNATIONAL, INC.  AND SUBSIDIARY
                           CONSOLIDATED BALANCE SHEETS
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                    June 30,        December 31,
                                                                     1998              1997     
<S>                                                              <C>              <C>
                                      ASSETS
Current assets:
     Cash                                                        $     37,163     $    104,997
     Cash - restricted                                                 80,960           80,960
     Accounts receivable                                              132,742          150,634
     Inventory                                                        511,824          437,798
     Prepaid expenses                                                   8,912           17,528
          Total current assets                                        771,601          791,917

     Machinery and equipment, net                                   3,263,716        3,398,363

Other assets:
     Exclusive agency rights, net                                     183,584          231,524
     Customer list, net                                                46,875          103,125
     Deferred offering costs                                           50,000           50,000
     Organizational costs                                               4,459            6,369
     Other assets                                                     174,736             -  
          Total other assets                                          459,654          391,018

          Total assets                                          $   4,494,971     $  4,581,298


          LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
     Accounts payable                                           $      18,364     $    67,639
     Accounts payable - related party                                  53,477          13,477
     Accrued expenses                                                 150,678          81,207
     Note payable - short term                                        265,100         100,100
     Line of credit                                                    71,428            -  
     Due to stockholder                                                65,539          15,739
          Total current liabilities                                   624,586         278,162

Excess of net assets acquired over cost                               512,804         540,804

Commitments and contingencies (Note 5)                                   -               -  

Stockholders' equity:
     Common stock $.001 par value; authorized: 10,000,000
     shares; issued and outstanding: 3,819,119 and
     2,990,118 shares, respectively                                     3,819           2,990
     Additional paid-in capital                                     7,886,791       6,853,867
     Accumulated deficit                                           (4,429,941)     (2,925,233)
          Subtotal                                                  3,460,669       3,931,624
     Deferred costs                                                  (103,088)       (169,292)
          Total stockholders' equity                                3,357,581       3,762,332
Total liabilities and stockholders' equity                      $   4,494,971     $ 4,581,298

</TABLE>

See accompanying notes to consolidated financial statements.

<PAGE>    2

                   SDC INTERNATIONAL, INC.  AND SUBSIDIARY
                    CONSOLIDATED STATEMENTS OF OPERATIONS
                           FOR THE THREE MONTHS ENDED
                                 (UNAUDITED)

<TABLE>
<CAPTION>

                                                                   June 30,         May 31,
                                                                     1998            1997          
<S>                                                             <C>               <C>
Sales                                                           $      43,399     $     -  

Cost of goods sold                                                     21,392           -  

Gross profit                                                           22,007           -  

Expenses:
     Selling, general and administrative                              360,468         136,943
     Depreciation and amortization                                    135,010         117,152
     Stock based consulting and compensation                          202,350           -  
              Total expenses                                          697,828         254,095

Loss from operations before other income and provision
 for income taxes                                                    (675,821)       (254,095)          

Other income (expense):
     Interest income                                                       74           1,358
     Interest expense                                                 (15,163)        (11,824)
     Amortization of excess of net assets acquired over costs          14,000           -  
     Foreign currency exchange gain (loss)                             34,495           -  
             Total other income (loss)                                 33,406         (10,466)

Loss before provision for income taxes                               (642,415)       (264,561)          
Provision for income taxes                                                121           -  

Net loss                                                         $   (642,294)    $  (264,561)

Loss per share:
     Basic and diluted:
             Net loss                                            $       (.18)    $     (.12)

Weighted average number of shares outstanding                       3,632,980       2,289,011

</TABLE>

See accompanying notes to consolidated financial statements

<PAGE>    3

                   SDC INTERNATIONAL, INC.  AND SUBSIDIARY
                    CONSOLIDATED STATEMENTS OF OPERATIONS
                           FOR THE SIX MONTHS ENDED
                                (UNAUDITED)

<TABLE>
<CAPTION>
                                                                   June 30,           May 31,
                                                                    1998               1997     
<S>                                                             <C>               <C>
Sales                                                           $      61,937     $     18,384

Cost of goods sold                                                     29,077           15,738

Gross profit                                                           32,860            2,646

Expenses:
     Selling, general and administrative                              640,706          237,991
     Depreciation and amortization                                    260,500          226,393
     Stock based consulting and compensation                          698,864             -  
           Total expenses                                           1,600,070          464,384

Loss from operations before other income and provision
 for income taxes                                                  (1,567,210)        (461,738)

Other income (expense):
     Amortization of excess of net assets acquired over costs          28,000             -  
     Interest income                                                      112            3,066
     Interest expense                                                 (20,753)            -  
     Foreign currency exchange gain (loss)                             55,143             -  
          Total other income (expense)                                 62,502            3,066

Loss before provision for income taxes                             (1,504,708)        (458,672)

Provision for income taxes                                              -                 -  

Net loss                                                        $  (1,504,708)     $  (458,672)

Loss per share:
     Basic and diluted:
          Net loss                                              $        (.43)     $      (.21)

Weighted average number of shares outstanding                       3,495,952         2,214,858

</TABLE>


See accompanying notes to consolidated financial statements

<PAGE>    4

                    SDC INTERNATIONAL, INC.  AND SUBSIDIARY
                CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
                    FOR THE SIX MONTHS ENDED JUNE 30, 1998
                                 (UNAUDITED)

<TABLE>
<CAPTION>
                                                                   Additional                                       Total
                                              Common Stock           paid-in      Accumulated       Deferred    Stockholders'
                                         Shares        Amount        capital        Deficit          Costs          Equity     
<S>                                    <C>           <C>           <C>            <C>            <C>             <C>
Balances at December 31, 1997          2,990,118     $   2,990     $ 6,853,867    $(2,925,233)   $  (169,292)    $ 3,762,332

Issuance of common stock in 
 connection with private placement
 memorandum, net of offering costs
 of $32,955                              169,001           169         220,378          -               -            220,547

Issuance of common stock pursuant
 to 1997 non qualified stock option
 plan                                    450,000           450         621,131          -               -            621,581
                                                           
Issuance of common stock for services    140,000           140         126,560          -               -            126,700

Issuance of stock pursuant to loan
 agreement                                70,000            70          64,855          -            (29,925)         35,000

Amortization of deferred costs              -              -              -             -             96,129          96,129

Net loss for the six months ended
 June 30, 1998                              -              -              -        (1,504,708)          -         (1,504,708)

Balances at June 30, 1998              3,819,119     $   3,819     $ 7,886,791    $(4,429,941)    $ (103,088)   $  3,357,581

</TABLE>


See accompanying notes to consolidated financial statements.

<PAGE>    5

                   SDC INTERNATIONAL, INC.  AND SUBSIDIARY
                    CONSOLIDATED STATEMENTS OF CASH FLOWS
                           FOR THE SIX MONTHS ENDED
                                (UNAUDITED)

<TABLE>
<CAPTION>

                                                                  June 30,              May 31,
                                                                    1998                 1997     
<S>                                                          <C>                   <C> 
Cash flows from operating activities:
     Net loss                                                $     (1,504,708)     $   (409,036)
 Adjustments to reconcile net loss to net
      cash (used for) provided by operating activities:
     Amortization and depreciation                                    327,908           234,303
      Issuance of stock for services                                  748,283              -  
     Decrease (increase) in:
          Accounts receivable                                          17,892          (105,134)
          Inventory                                                   (74,026)             -  
          Restricted cash                                                -                 -  
          Other assets                                               (174,736)             -  
          Prepaid expenses                                               (759)            6,000
     Increase (decrease) in:     
          Accounts payable                                            (49,275)             -  
          Accounts payable - related party                             40,000           404,680
          Accrued expenses                                             36,516           (39,060)
               Net cash (used for) provided by operating
               activities                                            (632,905)           91,753

Cash flows from investing activities:
     Purchase of machinery and equipment                               (9,657)             -  
               Net cash used for investing activities                  (9,657)             -  

Cash flows from financing activities:
     Proceeds from issuance of notes payable                          271,428            25,000
     Proceeds from stockholder                                         49,800             1,600
     Proceeds from sale of common stock                               253,500           190,678
     Cost associated with private placement memorandum
      and sale of common stock                                           -              (16,705)
               Net cash provided by financing activities              574,728           200,573

Net (decrease) increase in cash                                       (67,834)          292,326

Cash, at beginning of period                                          104,997              (788)
Cash ,at end of period                                           $     37,163       $   291,538

Supplemental disclosures of non-cash flow information:
     Cash paid for:
        Interest                                                 $      1,321       $    12,200
        Income taxes                                             $      3,681       $      -  

Supplemental disclosure of non-cash operating and
financing activities:
     Issuance of common stock as consideration for loans         $     29,925       $      -  
     Issuance of common stock as repayment of advance            $     35,000       $      -  
     Accrual of commissions and expenses on stock sales          $     32,955       $      -

     </TABLE>

See accompanying notes to consolidated financial statements.

<PAGE>     6

                      SDC INTERNATIONAL, INC.  AND SUBSIDIARY
                     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      FOR THE THREE MONTHS ENDED JUNE 30, 1998
                                    (UNAUDITED)


NOTE 1     -     GENERAL

SDC International, Inc. ("the Company") was incorporated in the state of 
Delaware on June 30, 1994.  The accompanying financial statements include the 
accounts of the Company, and its wholly-owned subsidiary, Skobal, s.a.  The 
Company's equipment is located in the Czech Republic.  Effective August 1998, 
in connection with the Company's planned acquisition of a significant portion 
of Tatra, a.s., the Company changed its year end from August 31 to December 
31.  This change became effective from the last annual reporting period, 
August 31, 1997, resulting in a transitional report for the period September 
1, 1997 through December 31, 1997.  The Company has previously filed Form 
10-QSB for the quarters ending November 30, 1997, February 28, 1998 and May 
31, 1998.

The accompanying unaudited consolidated financial statements have been 
prepared in accordance with generally accepted accounting principles for 
interim financial information and with instructions to Form 10-QSB.  
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 the interim consolidated financial 
statements include all adjustments necessary in order to make the consolidated 
financial statements not misleading.  The results of operations for the three 
and six months ended are not necessarily indicative of the results to be 
expected for the full year.  For further information, refer to the Company's 
audited consolidated financial statements and footnotes thereto at August 31, 
1997, included in the Company's Form 10-KSB and the Company's unaudited 
consolidated financial statements and footnotes thereto at December 31, 1997, 
included in the Company's transition report Form 10-QSB, filed with the 
Securities and Exchange Commission.

Certain reclassifications have been made to the May 31, 1997 financial 
statements in order to conform to the June 30, 1998 presentation.

NOTE 2     -     EXCLUSIVE AGENCY RIGHTS, NET

On April 21, 1994, one of the founding shareholders executed an exclusive 
agency representation letter agreement as agent of the Company with Diesel, 
a.s. (Formerly Skoda Diesel, a.s. ("Skoda"), pursuant to which the Company was 
appointed as Skoda's exclusive sales agent in North, South and Central America 
with the exception of the country of Peru.   In order for the Company to 
maintain its exclusively, it must generate annual gross sales with in the 
territory of at least $15,000,000 at the close of its sixth year, (April
1999), after the execution of the agreement.  As consideration for the
purchase of these exclusive agency rights, the Company has issued 51,650
shares of its common stock to Skoda.  Such stock has been assigned a value of
50% of the private offering per share price of $2.50.  Accordingly, the
company has valued such exclusively agency rights at $64,563 which is being
amortized on a straight-line basis over 5 years.  As a result, for each of the
six months ended June 30, 1998 and May 31, 1997, the company recorded
amortization expense of $6,456.

In October 1995 the Company purchased the exclusive rights to market and sell 
Skoda Diesel products into the countries of China and South Korea based upon 
the following terms.


<PAGE>    7

                      SDC INTERNATIONAL, INC.  AND SUBSIDIARY
                     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      FOR THE THREE MONTHS ENDED JUNE 30, 1998
                                    (UNAUDITED)


NOTE 2     -     EXCLUSIVE AGENCY RIGHTS, NET (Cont'd)

     South Korea

     i)    During the year 1997, sales to South Korea must be in the amount of
           least $2,400,000.
     ii)   During the year 1998, sales to South Korea must be in the amount of 
           $3,600,000.
     iii)  Each year thereafter, sales to South Korea must be in the amount of
           at least $5,000,000.

The Company paid Skoda, a one time fee of $50,000 for the acquisition of such 
exclusive rights.

     China

     i)    During the year 1997, sales to China must be in the amount of at
           least $3,000,000.
     ii)   During the year 1998, sales to China must be in the amount of at
           least $4,500,000.
     iii)  During the year 1999, sales to China must be in the amount of at
           least $6,000,000.

The Company paid Skoda a one time fee of $100,000 for the acquisition of such 
exclusive rights.  The agency rights from China and Korea are amortized on a 
monthly basis over five years.  For each of  the six months ended June 30, 
1998 and May 31, 1997, the company has recorded $21,456 in amortization 
expense.

On April 18, 1996, the Company entered into a modification agreement whereby 
all such sales levels were postponed for one year.

NOTE 3     -     NOTES PAYABLE

a)   The Company had two bank lines-of-credit which provided short-term 
borrowings up to $220,000.  Interest on advances was payable quarterly at a 
fixed rate of 4.32%.  The lines-of-credit expired on October 19, 1997 and were 
secured by a certificate of deposit amounting to $250,000.  During October 
1997, the certificate of deposit was redeemed and such lines of credit were 
repaid.

b)   During October 1997, the Company borrowed $100,100 from an individual
which is payable in 180 days (which has been extended) at an interest rate of
14%.  In connection with such borrowing, the Company issued 15,000 common
shares as additional consideration.  See Note 4(c).  The issuance of such
shares results in an effective interest rate of 40%.  As of June 30, 1998,
the balance of the note was $65,100 and the Company had accrued $8,733 of
interest and amortized $13,125 of deferred interest in relation to this note.

c)   During June 1998, the Company borrowed $100,000 from a shareholder which
is payable in 90 days at an interest rate of 14% per annum.  In connection
with such borrowing, the Company issued 20,000 common shares as additional
consideration.  See Note 4(c).  The issuance of such shares results in an 
effective interest rate of 82%.  As of June 30, 1998, the Company had accrued 
$1,150 of interest and amortized $5,700 of deferred interest in relation to 
this note.

<PAGE>    8

                      SDC INTERNATIONAL, INC.  AND SUBSIDIARY
                     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      FOR THE THREE MONTHS ENDED JUNE 30, 1998
                                    (UNAUDITED)


NOTE 3     -     NOTES PAYABLE (Cont'd)

d)   During June 1998, the Company borrowed $100,000 from a shareholder which
is payable in 180 days at an interest rate of 14% per annum.  In connection
with such borrowing, the Company issued 15,000 common shares as additional 
consideration.  See Note 4(c).  The issuance of such shares results in an 
effective interest rate of 40%.  As of June 30, 1998, the Company had accrued 
$1,150 of interest and amortized $2,138 of deferred interest in relation to 
this note.

NOTE 4     -     STOCKHOLDERS' EQUITY

a)     Private Placement Memorandum

On February 24, 1997, the Company commenced and privately offered pursuant to 
rule 505, Regulation D, on a best efforts basis, no more than 500,000 shares 
of common stock in a ninety-day period (before extensions) of its $.001 par 
value common stock at $1.50 per share before deducting discounts, commissions 
and non-accountable expenses. During the six months ended June 30, 1998, the 
Company sold an aggregate of 169,001 shares yielding net proceeds of $220,545.

b)     1997 Non-qualified stock option plan

On September 5, 1997, the Company established a Non-Qualified Stock Option 
Plan ("the Plan") pursuant to which 750,000 shares of common stock are 
reserved for issuance.  The option price per share is determined by the Board 
of Directors at the time any options are granted.  The Plan is designed to 
serve as an incentive for retaining qualified and competent persons who are 
key employees, consultants, representative, officers and directors of the 
Company.  During the three and six months ended June 30, 1998, the Company 
issued 241,500 and 450,000 shares pursuant to the Plan.  Such shares have been 
valued at $338,542 and $621,581 representing 75% of the average market value 
during the month of issuance as a result of the illiquidity of the Company's 
stock.  In connection with the issuance of such shares, the Company has 
recorded $621,581 as stock-based compensation for the six months ended June 
30, 1998.  Amortization of deferred costs for the three and six months ended 
June 30, 1998, amounted to $48,600 and $97,200, respectively.

c)      Deferred interest

In connection with the obtaining of loans (Note 3(b), 3(c) and 3(d)), the 
Company issued 15,000, 20,000, and 15,000, shares of common stock, 
respectively, as additional consideration.  Such shares have been recorded at 
50% of the average market value of the stock during the month of issuance as a 
result of the illiquidity of the Company's stock.  Accordingly, the Company 
has recorded deferred interest of $13,125, $17,100 and $12,825, respectively, 
which is being amortized over the term of the loans.  For the three and six 
months ended June 30, 1998, amortized interest amounted to $7,838 and $15,129.

<PAGE>    9

                      SDC INTERNATIONAL, INC.  AND SUBSIDIARY
                     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      FOR THE THREE MONTHS ENDED JUNE 30, 1998
                                    (UNAUDITED)


NOTE 4     -     STOCKHOLDERS' EQUITY (Cont'd)

d)     Stock-based consulting

During the six months ended June 30, 1998, the Company issued 140,000 shares 
of restricted common stock for services by two individuals.  Such shares have 
been valued at $126,700 representing 50% of the average market value when 
issued as a result of the illiquidity of the Company's stock and the 
restricted nature of the shares issued.  No shares of common stock were issued 
for services during the three months ended June 30, 1998.

e)     Issuance of common stock for acquisition of customer list

Pursuant to a purchase agreement dated December 2, 1995 between the Company 
and an unrelated party, the Company acquired certain assets comprising of 
supplier and customer lists.  As consideration for such assets, the Company 
paid $150,000 and issued 150,000 shares of its $.001 par value common stock.  
Such stock has been assigned a value of 50% of the private offering per share 
price of $2.50.  Accordingly, the Company valued such assets at a total of 
$337,500 comprising of $150,000 in cash and $187,500 of common stock.  
Management has elected to amortize such assets over the life of the management 
agreement of three years.  Accordingly, for the six months ended June 30, 1998 
and May 31, 1997, the Company recorded amortization expense amounting to 
$56,250 and $56,250, respectively.

f)     Note payable

During the six months ended June 30, 1998, the Company issued 35,000 shares of 
restricted common stock in repayment of an advance by a shareholder.  Such 
shares have been valued at the amount of the advance of $35,000.

NOTE 5     -     COMMITMENTS AND CONTINGENCIES

a)     Lease agreement

The Company leases its administrative office pursuant to signed lease 
agreement commencing July 1, 1995 and expiring on June 30, 1997.  Such lease 
requires monthly payments of $3,500.  Effective December 1996, the Company 
terminated this lease.  Prior to July 1, 1995 the Company maintained its 
administrative office on a month to month basis, free of charge at the office 
of Worth. Worth is an entity which the Chairman of the Company is also a 50% 
shareholder.  Effective January 1, 1998, the Company entered into a new lease 
for a one year term.  Such lease requires monthly payments of $2,000.

Included in general and administrative expenses is rent expense which amounted 
to $14,134 and $9,318 for the three months ended June 30, 1998 and May 31, 
1997, respectively and $28,268 and $36,499 for the six months ended June 30, 
1998 and May 31, 1997, respectively.


<PAGE>    10

                      SDC INTERNATIONAL, INC.  AND SUBSIDIARY
                     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      FOR THE THREE MONTHS ENDED JUNE 30, 1998
                                    (UNAUDITED)


NOTE 5     -     COMMITMENTS AND CONTINGENCIES (Cont'd)

b)     Significant customers and vendors

For the six months ended May 31, 1997, the Company purchased 100% of its cost 
of goods sold from two of its founding stockholders, Skoda and Double.  No 
purchases were made from Skoda and Double during the six months ended June 30, 
1998.

c)     Concentration of credit risk

Due to its current limited sales, the Company has a high concentration of 
credit risk until such transactions are completed.  The Company is actively 
seeking sales outside of the United States.  If such sales occur, the revenue 
and subsequent collections will be subject to the fluctuations such sales 
generate, both from currency and political changes.  The Company's machinery 
and equipment is located in the Czech Republic.  The Company's primary source 
of inventory is currently Skoda and Tatra and as such, it is subject to 
Skoda's and Tatra's risks of business and its continued financial health, as
well as the risks associated with foreign businesses, both from currency and
political changes.

d)     Management agreement

On December 15, 1995 the Company and Worth entered into a management agreement 
with an individual for a period of three years.  Pursuant to such agreement, 
the individual shall devote such time, attention and efforts to management 
services as may be reasonably required by the Company and Worth.  The Company 
and Worth will pay such individual an amount equal to twenty-five percent 
(25%) of the gross profit from sales made by the Company.  Such payments are 
payable monthly after the collection of receivables from said sales.  There 
are no amounts currently payable under this agreement.

e)     Letter of intent

On October 10, 1997, the Company signed a Letter of Intent with an underwriter 
to proceed on a "Firm Commitment" basis with a secondary offering of the 
Company's Common Stock and redeemable Warrants ("the Warrants").  The Company 
will offer 1,000,000 shares of Common Stock and 1,000,000 Warrants.  The 
1,000,000 shares and Warrants will be offered to the public at a price of 
$6.00 per share and $.125 per Warrant, respectively.  The total gross 
offering  amounts to $6,125,000.

Each Warrant, which is redeemable in 60 months, entitles the holder thereof to 
purchase one share of Common Stock at 120% of the offering price of Common 
shares.  The warrant may be redeemed by the Company at $.10 each after the 
common shares have traded at 150% of the offering price of the common shares 
for 10 consecutive days.  Due to the current progress of negotiations with 
potential strategic partners, this offering is postponed by management.


<PAGE>

                      SDC INTERNATIONAL, INC.  AND SUBSIDIARY
                     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      FOR THE THREE MONTHS ENDED JUNE 30, 1998
                                    (UNAUDITED)


NOTE 5     -     COMMITMENTS AND CONTINGENCIES (Cont'd)

f)     Finder's fee agreement

On May 20, 1996, the Company entered into a finder's fee agreement with Prime 
Charter, Ltd ("Prime") for a period of ten years, renewable for additional 
five year periods.  Pursuant to such agreement, any sales to entities 
introduced to the Company by Prime shall result in a finder's fee to Prime of 
two percent (2%) of the gross sales price or ten percent (10%) of the adjusted 
gross profit resulting from the sales.  Such payments are due 45 days after 
each quarter-annual calendar period.

g)     Dependence on Skoda and Tatra

The Company's operations are dependent on Skoda and Tatra since Skoda and 
Tatra are responsible for the manufacturing of all of the Company's products 
and for making available sufficient inventory.  The Company faces risks of the 
inability to obtain products in the event of production problems of Skoda or 
Tatra due to labor problems, governmental regulations, working capital 
deficiencies, political unrest and other problems which may result in the 
inability of Skoda or Tatra to fulfill orders of the Company.

h)     Line of Credit

During the June 1998, the Company obtained an unsecured $500,000 line of 
credit from a shareholder with an interest rate at fourteen percent (14%) per 
annum.  The Company may borrow from the credit line up to $35,714 in any one 
week.  Principal and interest are payable on December 18, 1998.  If the 
Company is not able to pay such principal and interest when due, the principal 
balance of the line of credit and any outstanding accrued interest may be 
converted into common stock at the rate of $1 per share.  The amount 
outstanding at June 30, 1998 under this agreement is $71,428.

NOTE 6     -     RELATED PARTY TRANSACTIONS

a)     Acquisition of exclusive agency rights

In October 1995, the Company purchased the exclusive rights to market and sell 
Skoda products into the countries of China and South Korea.  In consideration 
for these rights the Company paid Skoda $150,000.

b)     Accounts payable

At June 30, 1998, the Company had accounts payable totaling $53,477 which was 
due to Double Seal Ring Company, one of its founding shareholders.

c)     Due to officer

The Company's Chief Executive Officer and shareholder advances funds to or on 
behalf of the Company.  As of June 30, 1998, $65,539 was owed to such 
officer.  Such advances are non interest bearing and due on demand.

<PAGE>   11

                      SDC INTERNATIONAL, INC.  AND SUBSIDIARY
                     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      FOR THE THREE MONTHS ENDED JUNE 30, 1998
                                    (UNAUDITED)


NOTE 6     -     RELATED PARTY TRANSACTIONS (Cont'd)

d)     Management fees

For the six months ended June 30, 1998 and May 31, 1997, the Company recorded 
$137,984 and $18,000 respectively for management fees and travel allowance to 
the Chief Executive Officer and the President.

e)     Rent Expense

Effective January 1, 1998, the Company rents its executive office on a month 
to month basis from its Chief Executive Officer with monthly payments 
amounting to approximately $2,000.

NOTE 7     -     SUBSEQUENT EVENTS

a)     Due to shareholder

During July 1998, the Chief Executive Officer advanced $17,000 to the Company. 
Such advances are non interest bearing and due on demand.

b)     Acquisition

During July 1998, the Company entered into a letter of intent to purchase 
43.5% of  the Czech truck manufacturer, Tatra a.s., for approximately $13.6 
million. In addition, the Company will purchase Tatra's senior secured loan 
from the bank holding such note, with an approximate balance of $89.5 million, 
for approximately $30 million. Both agreements are anticipated to close 
September 30.

There is no assurance that the transaction will be completed since the Company 
must obtain sufficient capital to complete the acquisition, thus, no pro forma 
financial information has been presented. The following information is from 
Tatra's audited financial statements. Tatra had sales of approximately $290 
million for the year ended December 31, 1997. At December 31, 1997, Tatra had 
total assets of approximately $230 million.

c)     Note payable

During August 1998, the Company borrowed $350,000 from a shareholder which is 
payable in 180 days at an interest rate of 14% per annum.  In connection with 
such borrowing, the Company issued 37,500 common shares as additional 
consideration.  Such shares will be valued at 50% of the average market value 
when issued as a result of the illiquidity of the Company's stock and the 
restricted nature of the shares issued.  The issuance of such shares results 
in an effective interest rate of 32%.

d)     Note payable

During August 1998, the Company borrowed $125,000 from each of two 
shareholders which is payable in 180 days at an interest rate of 14% per 
annum.  In connection with such borrowing, the Company issued each shareholder 
31,250 common shares as additional consideration.  Such shares will be valued 
at 50% of the average market value when issued as a result of the illiquidity 
of the Company's stock and the restricted nature of the shares issued.  The 
issuance of such shares results in an effective interest rate of 57%.


<PAGE>  12

                      SDC INTERNATIONAL, INC.  AND SUBSIDIARY
                     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      FOR THE THREE MONTHS ENDED JUNE 30, 1998
                                    (UNAUDITED)


NOTE 7     -     SUBSEQUENT EVENTS (Cont'd)

e)     Inventory loans

The Company has retired $96,500 of short term inventory loans since June 30, 
1998.           

<PAGE>    13

ITEM 2    -  MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
             RESULTS OF OPERATIONS

     The Company is the Central and South American distributor for Czech 
heavy-duty truck manufacturer Tatra.  Tatra, a.s., is a Czech manufacturer of 
on/off-road heavy trucks.  The factory was founded in 1850 and in 1898 the 
first truck was manufactured.  The factory continued development and 
innovations of its vehicle and today produces a truck with the an air cooled 
diesel engine and a solid central backbone tube with swing half axles, both 
features being unique features of the Tatra truck.  Engines are manufactured 
by Tatra, Deutz, Detroit Diesel or Cummins Diesel.  Tatra has ISO 9001 
certification and Tatra trucks meet all EURO II regulations.

     During the quarter ending June 30, 1998, there was minimal activity in 
the Company's division, SDC Prague, s.r.o., in the Czech Republic.  SDC Prague 
plans to market and sell electrical generating and co-generating equipment 
using the components of East European manufacturers.

     During the quarter ending June 30, 1998, the Company continued rebuilding 
the inventories of its Bolivian subsidiary, Skobol, s.a., formerly the 
subsidiary of Czech trading company Motokov International.  Skobol is a 
thirty-seven year old distributor of Czech products within Bolivia, and the 
Company plans to use this subsidiary as its base to expand throughout that 
region of South America with the other Czech products offered by the Company.  
The new subsidiary provided an excess of $559,471 of net assets acquired over 
the cost of the acquisition.  Skobol operated at a small loss during this 
period as the products are being expanded and Skobol is reintroducing itself 
to the marketplace as a continuing supplier of Czech products.  The 
subsidiary's financial statements are consolidated with those of the Company.

     The Company has cancelled its plans to sell and finance inventories of 
Slovakian manufacturer Krizik, a.s., because the Company has developed similar 
opportunities with companies with whom SDC has existing relationships and 
which are located within the Czech Republic where the Company conducts most if 
its business activities.

     The Company concluded its Regulation D, Rule 505 offering of its common 
stock which provided a gross total of $740,000 for the Company.  The Five Year 
Growth Plan which was completed in August 1997 has been updated to reflect the 
positive developments of the prior six months and management is exploring 
different sources of additional capital and reviewing different methods of 
obtaining additional capital for the Company in order to execute its five year 
plan.

     At the close of the quarter ending June 30, 1998, the Company continued 
negotiating for a possible acquisition of Skoda's Diesel International 
operations.  Management and shareholder control of Diesel International 
(formerly Skoda Diesel) changed in 1996, and the Company believes that if an 
acquisition can be made on terms favorable to the Company, potential negative 
effects of the management and shareholder changes of 1996 will be eliminated 
and the Company could exert total control over this supplier.  SDC management 
continues to work with the management in place at Diesel International and 
relationships with management are satisfactory.  Discussions continue with two 
other East European manufacturers of industrial products which should be 
synergistic with the Company's present products and markets.

     There can be no assurances that any of the matters discussed above will 
come to fruition or will result in positive results for the Company.

<PAGE>  14

ITEM 2   -  MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
            RESULTS OF OPERATIONS

     The Company has devoted substantial time and effort to negotiating and 
arranging strategic alliances with major Czech manufacturers rather than 
devoting its time to beginning its marketing and sales development.  It is 
felt that the most efficient use of time and resources will be with the proper 
product mix for entering new markets.  Therefore, the Company's revenues to 
date are primarily the result of orders received by the Company rather than 
the results of marketing efforts by the Company.  The Company records revenue 
when products are shipped.  During the quarter ending June 30, 1998, the 
Company shipped $61,937 and realized a gross profit from those sales of 
$22,007.  These sales were made by the new subsidiary, Skobol, s.a.  
Management believes sales by Skobol will increase as its reorganization of its 
operations is completed and new inventories are provided.  However, Company 
sales and shipments will continue to be sporadic until a more steady flow of 
orders exist, and until the marketing efforts for larger items, such as 
electrical generating sets and trucks, can come to fruition.

     Operating expenses for the quarter ending June 30, 1998 were more than in 
the quarter ending May 31, 1997, due primarily to the expansion of management, 
development of additional product lines needed in order to enhance future 
growth and revenues of the Company, and the continuing negotiations for major 
strategic alliances which often times include paid professional advisors such 
as attorneys and accountants.  Expense categories such as legal, accounting, 
travel, and costs and expenses for securities matters increased due to the 
fact that the Company is a fully reporting 12 (g) company, due to the planned 
acquisition of new product lines, and due to the extensive discussions and 
negotiations in the Czech Republic regarding future strategic alliances and 
the possible acquisition of Diesel International.

     Total expenses for the quarter ending June 30, 1998 were $697,556 and 
$254,095 for the quarter ending May 31, 1997.  Non-cash expenses as 
deprecation and amortization and payment for consulting services accounted for 
$337,360 more than forty-eight (48%) of the expenses during the quarter ending 
June 30, 1998.  During the quarter ending June 30, 1998, expenses increased 
due to the increased activity level of corporate and product acquisition plans 
and related activities.  The Company's net loss of $642,294 for the quarter 
ending June 30, 1998, includes certain non-cash charges as follows:

               Depreciation and amortization     $     135,010
               Issuance of common stock as
                 consideration of services             202,350

               Total non-cash charges            $     337,360

     Accordingly, the Company's cash loss before the above charges amounted to 
approximately $304,934.

<PAGE>    15


ITEM 2   -  MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
            RESULTS OF OPERATIONS

     During the three months ending June 30, 1998, as compared to the three 
months ending May 31, 1997, operating expenses were approximately $443,461 
higher.  Management expects operating expenses (non-depreciation and 
non-amortization), to remain at this approximate level for the near future due 
to the level of negotiations and expansion discussions taking place presently.

     Operating expense categories which exceeded $5,000, for the three month 
period ending June 30, 1998, were; Amortization and depreciation $135,010; 
Office rent $20,567; Management compensation and salary $43,000; Travel and 
lodging $16,504; Consulting $13,441; Legal and accounting $21,461; Telephone 
$11,777; Consulting costs paid by issuance of stock $188,542; and maintenance 
$17,549; Office supplies $7,706; Wages $40,687; and Management compensation 
paid by stock $150,000.

     Operating expense categories which exceeded $5,000 for the three month 
period ending May 31, 1997 were; Amortization and depreciation $117,151; 
Office rent $9,318; Marketing $35,720; Taxes and licenses $9,335; Interest 
$11,824; Management compensation and salary $18,000; Travel and lodging 
$23,866; Consulting $18,293; Legal and accounting $8,157; and Telephone 
$9,537.

LIQUIDITY AND CAPITAL RESOURCES

     At the end of June 1998, the Company's working capital is $147,016.  Net 
cash used for the Company's operating activities for the quarter ending June 
30, 1998 amounted to $(771,543) whereas the net cash provided by operating 
activities for the quarter ending May 31, 1997 amounted to $91,753.  Net cash 
provided by financing activities in the quarter ending June 30, 1998, was 
$713,366 compared to $200,573 for the quarter ending May 31, 1997.  Net cash 
provided for (used by) investing activities during the quarter ending June 30, 
1998, was $(9,657) compared to $0  for the quarter ending May 31, 1997.  
Therefore, total cash at the end of the quarter ending June 30, 1998 was 
$37,163 compared to $291,538 at the end of the quarter ending May 31, 1997.  
During the quarter ending June 30, 1998 all corporate debt amounted to 
$422,006.

     Management is evaluating its current and projected cash needs to 
determine if its current financial situation will be sufficient to meet such 
needs.  If the Company continues according to its present plans and without 
modification, the Company will be required to obtain additional financing or 
equity capital.  Management is actively exploring possible sources of 
additional capital and is reviewing possible methods to obtain such additional 
capital, as needed.  There is no assurance that such financing or capital will 
be available.

     Negative cash flows from the Company's operating activities are 
anticipated to continue until the Company has established its distributors 
within its sales territories, nas received and shipped orders, and has 
collected payment for such orders.  The Company may encounter difficulties in 
financing the purchase of inventory necessary to complete orders.  The Company 
acknowledges that there can be no assurance that it will be able to obtain 
capital or financing until the time of such payment is received or that such 
capital is unable to provide needed revenues to finance its ongoing operating 
or if the Company does not receive additional capital, there could be a severe 
adverse impact on the Company's future operations.

<PAGE>    16


ITEM 2   -  MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
            RESULTS OF OPERATIONS

LIQUIDITY AND CAPITAL RESOURCES (Cont'd)

     On September 5, 1997, the Company established a Non-Qualified Stock 
Option Plan ("The Plan") pursuant to which 750,000 shares of common stock are 
reserved for issuance.  The option price per share shall be determined by the 
Board of Directors at the time any options are granted.  The Plan is designed 
to serve as an incentive for retainage qualified and competent persons who are 
key employees, consultants, representatives, officers and directors of the 
corporation.  As of June 30, 1998, 600,000 shares had been issued under such 
Plan.  See Notes to financial statements, Note 5(b).

     On October 10, 1997, the Company signed a Letter of Intent with an 
underwriter to proceed on a "Firm Commitment" basis with a secondary offering 
of the Company's common stock and redeemable warrants ("the Warrants").  The 
Company plans to offer 1,000,000 shares and warrants will be offered to the 
public at a price of $6.00 per share and $0.125 per warrant, respectively.  
The total gross offering amounts to $6,125,000.  The Company, if necessary, 
will effect a reverse stock split in order to complete the secondary offering 
at a price of at least $6.00 per share.  Each warrant, which is redeemable 
within 60 months, entitles the holder thereof to purchase one share of common 
stock at 120% of the offering price of the common shares. The warrants may be 
redeemed by the Company at $0.10 each after the common shares have traded at 
150% of the offering price of common shares for ten consecutive days.  Due to 
the current progress of negotiations with potential strategic partners, this 
offering is postponed by management.

     The Company' products are sold in US dollars and the Company does not 
believe currency exchange rates or current inflation rates will have a 
significant effect on sales or profitability.  Although the Company maintains 
a bank account in Czech currency within the Czech Republic for paying local 
expenses, the amount on deposit in such account is usually small and, 
therefore, fluctuation in the currency exchange rates should not have a 
significant effect on the Company.

     During June 1998, the Company obtained an unsecured $500,000 line of 
credit from a shareholder with an interest rate at fourteen percent (14%) per 
annum. The Company may borrow from the credit line up to $35,714 in any one 
week. Principal and interest are payable on December 18, 1998. If the Company 
is not able to pay such principal and interest when due, the principal balance 
of the line of credit and any outstanding accrued interest may be converted 
into common stock at the rate of $1 per share.

     During July 1998, the Chairman of the Company advanced $17,000 to the 
Company. Such advances are non interest bearing and due on demand.

     During July 1998, the Company entered into a letter of intent to purchase 
43.5% of  the Czech truck manufacturer, Tatra a.s., for approximately $13.6 
million. In addition, the Company will purchase Tatra's senior secured loan 
from the bank holding such note, with an approximate balance of $89.5 million, 
for approximately $30 million. Both agreements are anticipated to close 
September 30.

     There is no assurance that the transaction will be completed since the 
Company must obtain sufficient capital to complete the acquisition. The 
following information is from Tatra's audited financial statements. Tatra had 
sales of approximately $290 million for the year ended December 31, 1997. At 
December 31, 1997, Tatra had total assets of approximately $230 million.

<PAGE>    17

PART II - OTHER INFORMATION


ITEM 1 - Legal Proceedings:

     None

ITEM 2 - Changes in Securities:

     None

ITEM 3 - Defaults Upon Senior Securities:

     None

ITEM 4 - Submission of Matters to a Vote of Security Holders:

     None

ITEM 5 - Other Information:

     None

ITEM 6 - Exhibits and Reports on Form 8-K:

     None

<PAGE>    18

                               SIGNATURES

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

                                            SDC INTERNATIONAL, INC.



                                            BY:/s/Ronald A. Adams
                                               Ronald A. Adams, President

August 31, 1998


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



/s/Ronald A. Adams                              August 31, 1998
Ronald A. Adams, Director and President
(Principal Executive Officer and Principal
Financial Officer)


/s/Henry S. Green                               August 31, 1998
Henry S. Green, Jr., Director