<PAGE>   1

                       Securities and Exchange Commission
                             Washington, D.C. 2O549

                                    FORM lO-Q/A

                Annual Report Pursuant to Section 13 or 15(d) of
                       the Securities Exchange Act of 1934
(Mark one)

|x| ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
    ACT OF 1934

For the quarterly period ended    September 30 1997     or
                               -----------------------

|_| TRANSITION REPORT PURSUANT TO SECTION 13 OR l5(d) OF THE SECURITIES
    EXCHANGE ACT OF 1934

For the transition period from ______________  to ______________

Commission File Number 0-16097

                            BAYOU INTERNATIONAL, LTD.
             (Exact name of Registrant as specified in its charter)

         Delaware                                        98-0079697
-------------------------------                       -------------
(State or other jurisdiction of                       (IRS Employer
incorporation or organisation)                        Identification No.)

        Level 8, 580 St. Kilda Road, Melbourne, Victoria, 3004 Australia
        ----------------------------------------------------------------
               (Address of principal executive offices) (Zip Code)

Registrant's telephone number, including area code 0ll (613) 9276-7888
                                                   --------------------

Securities registered pursuant to Section 12(b) of the Act :

    Title of each class                               Name of each exchange
                                                        on  which registered

             N/A                                             N/A
             ---                                             ---

           Securities registered pursuant to Section 12(g) of the Act:
                     Common Stock, par value $.15 per share
                                (Title of Class)

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements the past 90 days. 

              Yes |X|               No

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

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

                      APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date. There were 46,941,789
outstanding shares on Common Stock, as of the latest practicable date. There
were 46,941,789 outstanding shares of Common Stock as of September 30, 1997.


   
<PAGE>   2

                                     PART 1

                              FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS

      Introduction to Interim Financial Statements.

      The interim financial statements included herein have been prepared by
Bayou International, Ltd. (the "Company") without audit, pursuant to the rules
and regulations of the Securities and Exchange Commission (The "Commission").
Certain information and footnote disclosure normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted pursuant to such rules and regulations, although
the Company believes that the disclosures are adequate to make the information
presented not misleading. These interim financial statements should be read in
conjunction with the financial statements and notes thereto included in the
Company's Annual Report on Form 10-K for the year ended June 30, 1997.

      In the opinion of management, all adjustments, consisting only of normal
recurring adjustments, necessary to present fairly the financial position of the
Company as of September 30, 1997 and September 30, 1996, the results of its
operations for the three month periods ended September 30, 1997 and September
30, 1996, and the changes in its cash flows for the three-month periods ended
September 30, 1997 and September 30, 1996, have been included. The results of
operations for the interim periods are not necessarily indicative of the results
for the full year.

      UNLESS OTHERWISE INDICATED, ALL FINANCIAL INFORMATION PRESENTED IS IN
      AUSTRALIAN DOLLARS.


                                       2
<PAGE>   3

                    BAYOU INTERNATIONAL, LTD. AND SUBSIDIARY
                           Consolidated Balance Sheets
                        September 30, 1997, June 30, 1997
                             and September 30, 1996
                             (in Australian Dollars)
                                 (000's omitted)
                                   (Unaudited)

<TABLE>
<CAPTION>
                                     ASSETS

                                                Sept 30     June 30     Sept 30
                                                   1997        1997        1996
<S>                                                 <C>         <C>         <C> 
Current Assets:
   Cash                                        $     62    $     53    $    113
   Accounts Receivable, net                          71          63          54
   Investments                                       --          --           3
                                               --------    --------    --------
     Total Current Assets                           133         116         170
                                               --------    --------    --------

Other Assets:
   Property and Equipment, net                       49          51          52
   Goodwill, net                                     --          --         400
                                               --------    --------    --------
     Total Other Assets                              49          51         452
                                               --------    --------    --------

         Total Assets                          $    182    $    167    $    622
                                               ========    ========    ========

                      LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities:
   Bank Overdraft                              $     --    $     --    $     --
   Short-Term Notes                                  69          --          --
   Accounts Payable and
     Accrued Expenses                               413         406         305
                                               --------    --------    --------

     Total Current Liabilities                      482         406         305
                                               --------    --------    --------

Long-Term Debt                                    3,497       3,267       2,542
                                               --------    --------    --------
     Total Liabilities                            3,979       3,673       2,847
                                               --------    --------    --------

Stockholders' Equity (Deficit):
   Common Stock:  $0.20 par value
     50,000,000 shares authorized,
     46,941,789 issued and outstanding            9,388       9,388       9,388
   Additional Paid-in-Capital                    11,592      11,592      11,592
   Cumulative Translation Adjustments              (697)       (435)        (40)
   Retained Deficits                            (24,080)    (24,051)    (23,165)
                                               --------    --------    --------
     Total Stockholders' Deficit                 (3,797)     (3,506)     (2,225)
                                               --------    --------    --------

         Total Liabilities and
           Stockholders' Equity                $    182    $    167    $    622
                                               ========    ========    ========

</TABLE>
              The accompanying notes are an integral part of these
                       consolidated financial statements.


                                       3
<PAGE>   4

                    BAYOU INTERNATIONAL, LTD. AND SUBSIDIARY
                      Consolidated Statements of Operations
         Three Months Ended September 30, 1997, Year ended June 30, 1997
                    and Three Months Ended September 30, 1997
                                 (000's omitted)
                             (in Australian Dollars)
                                   (Unaudited)

<TABLE>
<CAPTION>
                                               3 Months        Year    3 Months
                                                  Ended       Ended       Ended
                                                Sept 30     June 30     Sept 30
                                                   1997        1997        1996
                                               --------    --------    --------
<S>                                            <C>         <C>         <C>     
Revenues:
   Sales                                       $     --    $     66    $     --
   Other Income                                       6          11           5
                                               --------    --------    --------
                                                      6          77           5
Costs and Expenses:
   Cost of Sales                                     --          63          --
   Management Fee                                    --          --          --
   Interest Expense                                  69         259          60
   Legal, Accounting & Professional                  48          89          22
   Depreciation & Amortization                        3          12           3
   Amortization of Goodwill                          --         533         133
   Administrative                                   147         639          42
   Research & Development                            20          72          88
                                               --------    --------    --------

                                                    287       1,667         348
                                               --------    --------    --------

Loss from Operations                               (281)     (1,590)       (343)

   Gain (Loss) on Disposition of Assets               1          (2)         --
   Foreign Currency Exchange Gain (Loss)            251         332         (31)
                                               --------    --------    --------

                                                    252         330         (31)
                                               --------    --------    --------

Loss before Income Tax                              (29)     (1,260)       (374)

   Provision for Income Tax                          --          --          --
                                               --------    --------    --------

Net Loss                                            (29)     (1,260)       (374)
                                               ========    ========    ========

Earnings Per Common Equivalent Share           $   (.00)   $   (.03)   $   (.01)
                                               ========    ========    ========

Weighted Number of Common
     Equivalent Shares Outstanding               46,942      46,942      46,942
                                               ========    ========    ========
</TABLE>

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


                                       4
<PAGE>   5

                    BAYOU INTERNATIONAL, LTD. AND SUBSIDIARY
                 Consolidated Statements of Stockholders' Equity
                      September 30,1997 and June 30, 1997,
                      September 30, 1996 and June 30,1996,
                   and September 30, 1995, and June 30, 1995.
                             (in Australian Dollars)
                                 (000's omitted)
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                      
                                    Common Stock                Cumulative   Retained
                                 -----------------    Paid-In-  Translation  Earnings
                                 Shares     Amount    Capital   Adjustment   (Deficit)
                                 ------     ------    --------  -----------  ---------
<S>                              <C>      <C>        <C>        <C>          <C>     
Balance June 30, 1995            46,942   $  9,388   $ 11,592   $   (665)    (20,781)

   Net Income three months
     ending 9-30-95                  --         --         --                   (684)

Foreign Currency Translation         --         --         --        366          --
                                 ------   --------   --------   --------     ------- 

Balance Sept 30, 1995            46,942      9,388     11,592       (299)    (21,465)

   Net Income nine months
     ending 6-30-96                  --         --         --         --      (1,326)

Foreign Currency Translation         --         --         --        229          --
                                 ------   --------   --------   --------     ------- 

Balance June 30, 1996            46,942      9,388     11,592        (70)    (22,791)

   Net Income three months
     ending 9-30-96                  --         --         --         --        (374)

Foreign Currency Translation         --         --         --         30          --
                                 ------   --------   --------   --------     ------- 

Balance September 30, 1996       46,942      9,388     11,592        (40)    (23,165)

   Net Income nine months
     ending 6-30-97                  --         --         --         --        (886)

Foreign Currency Translation         --         --         --       (395)         --
                                 ------   --------   --------   --------     ------- 
Balance June 30, 1997            46,942      9,388     11,592       (435)    (24,051)

   Net Income three months
     ending 9-30-97                  --         --         --         --         (29)

Foreign Currency Translation         --         --         --       (262)         --
                                 ------   --------   --------   --------     ------- 
Balance September 30, 1997     $ 46,942   $  9,388   $ 11,592   $   (697)   $(24,080)
                               ========   ========   ========   ========    ======== 
</TABLE>

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


                                       5
<PAGE>   6

                    BAYOU INTERNATIONAL, LTD. AND SUBSIDIARY
                      Consolidated Statements of Cash Flows
                      Three Months Ended September 30, 1997
                        Year Ended June 30, 1997and Three
                         Months Ended September 30, 1996
                             (in Australian Dollars)
                                 (000's omitted)
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                3 Months        Year    3 Months
                                                   Ended       Ended       Ended
                                                 Sept 30     June 30     Sept 30
                                                    1997        1997        1996
                                                --------     -------    --------
<S>                                               <C>        <C>           <C>   
Cash Flows from Operating Activities:
   Net Loss                                       $ (301)    $(1,260)      $(374)
   Adjustments:
     Foreign Currency Translation                   (258)       (365)         30
Depreciation and Amortization                          3         545         136
           (Gain) Loss on Disposition of Assets       --           2          --
       Diminution of Value                            --          --          --
     Reversal of Writeoff                            272          --          --
     Change Net of Effects of Subsidiary
       Acquisitions:
         Accounts Receivable                          (8)        (10)         (1)
         A/P and Accrued Liabilities                   7          60         (41)
                                                  ------     -------       -----
        Net Cash Provided (Used) by
           Operating Activities                     (285)     (1,028)       (250)
                                                  ------     -------       -----
Cash Flow from Investing Activities:
   Capital Expenditures, Net                          (1)         (8)         --
   Net Proceeds from Investments                      --           1          --
                                                  ------     -------       -----
       Net Cash Provided (Used) in
           Investing Activities                       (1)         (7)         --
                                                  ------     -------       -----

Cash Flows from Financing Activities:
   Net Borrowing under Credit
     Line Arrangements                                --          --          --
   Net Borrowing from Affiliates                     219        1,015         --
   Net Borrowings                                     76          --         290
                                                  ------     -------       -----
       Net Cash Provided by
           Financing Activities                      295        1,015        290
                                                  ------     -------       -----
Net Increase (Decrease) in Cash                        9         (20)         40
Cash at Beginning of Year                             53          73          73
                                                  ------     -------       -----
Cash at End of Year                               $   62     $    53       $ 113
                                                  ======     =======       =====

Supplemental Disclosures:
   Common Stock Issued in Lieu of
     Debt Repayment                               $   --     $    --       $  --
   Interest Paid (Net Capitalized)                $   69     $   256       $  --
   Income Tax Paid                                $   --     $    --       $  --
</TABLE>

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


                                       6
<PAGE>   7

                    BAYOU INTERNATIONAL, LTD. AND SUBSIDIARY
                   Notes to Consolidated Financial Statements
                      September 30, 1997, June 30, 1997 and
                               September 30, 1996

(1)  Organization

      Bayou International, Ltd. (Bayou) is incorporated in the State of
        Delaware. The principal shareholder of Bayou is Edensor Nominees
        Proprietary Limited (Edensor), an Australian corporation. Edensor owned
        42.7% of Bayou as of September 30, 1997.

      Bayou's subsidiary is Solmecs Corporation N.V. (Solmecs), which it
        acquired controlling interest of, on September 3, 1987 and complete
        ownership on January 2, 1992.

      Bayou is primarily engaged in the research and development of high
        efficiency, low pollution or pollution-free products and technologies
        in the energy conversion and conservation fields through its 100%-owned
        subsidiary, Solmecs. All revenue is from contracted services provided
        by Solmecs. Almost all of Bayou's operating expenses are of a general
        and administrative and research and development nature.

(2)  Accounts Receivable

      Accounts Receivable at September 30,1997, 
      June 30, 1997 and September 30, 1996 includes:

<TABLE>
<CAPTION>
                                                     (in Australian Dollars)
                                                          (000's omitted)
                                                 Sept 30     June 30     Sept 30
                                                    1996        1997        1996
                                                    ----        ----        ----
<S>                                                 <C>         <C>         <C> 
Miscellaneous Receivables                           $ 71        $ 63        $ 54
  Less Allowance for
    Doubtful Account                                  --          --          --
                                                    ----        ----        ----

      Net                                           $ 71        $ 63        $ 54
                                                    ====        ====        ====

(3)  Investment Securities

      The following is a summary of Investment Securities at 
      September 30, 1997, June 30, 1997 and September
      30, 1996:


         Trading Securities:
           Marketable Equity
             Securities, at cost                    $ --        $ --        $  1
           Gross Unrealized Gains                     --          --           2
           Gross Unrealized Losses                    --          --          --
                                                    ----        ----        ----

           Marketable Equity Securities,
             at fair value                          $ --        $ --        $  3
                                                    ====        ====        ====
</TABLE>


                                       7
<PAGE>   8

                    BAYOU INTERNATIONAL, LTD. AND SUBSIDIARY
                   Notes to Consolidated Financial Statements
                      September 30, 1997, June 30, 1997 and
                               September 30, 1996

(4)  Property

      Property at September 30, 1997, June 30, 1997 
      and September 30, 1996 includes:

<TABLE>
<CAPTION>
                                                     (in Australian Dollars)
                                                         (000's omitted)
                                                 Sept 30     June 30     Sept 30
                                                    1997        1997        1996
                                                 -------     -------     -------
<S>                                                  <C>        <C>         <C> 
          Office Furniture & Equipment               191     $   185     $   169
          Motor Vehicles                              41          40          38
                                                 -------     -------     -------
                                                     232         225         207
          Less Accumulated Depreciation             (183)       (174)       (155)
                                                 -------     -------     -------

                                                 $    49     $    51     $    52
                                                 =======     =======     =======

(5)  Short Term and Long Term Debt

      The following is a summary of Bayou's borrowing arrangements as of
      September 30, 1997, June 30, 1997 and September 30, 1996.

      Long-Term

      Loan from Affiliate of Solmecs.
         Loan is interest free and has no fixed
         maturity date                            $   278      $  268    $   253
      Loan from corporations affiliated
         with the President of Bayou 
         Interest accrues at the ANZ
         Banking Group Limited rate + 1%
         for overdrafts over$100,000 
         Repayment of loan not required
         before June 30, 1998                       3,219       2,999      2,289
                                                  -------     -------    -------

         Total Long-Term                            3,497       3,267      2,542
                                                  -------     -------    -------

      Short-Term

      Overdraft arrangement with
         balance accruing interest                     --          --         --
      Notes Payable - Affiliates                       69          --         --
                                                  -------     -------    -------
                                                
          Total Short-Term                             69          --         --
                                                  -------     -------    -------
                                                
           Total                                   $3,566      $3,267     $2,542
                                                  =======     =======    =======
</TABLE>                                       


                                       8
<PAGE>   9

                    BAYOU INTERNATIONAL, LTD. AND SUBSIDIARY
                   Notes to Consolidated Financial Statements
                      September 30, 1997, June 30, 1997 and
                               September 30, 1996

(6)  Affiliate Transactions

      Bayou advances to and receives advances from various affiliates. All
         advances between consolidated affiliates are eliminated on
         consolidation. At September 30, 1997, Bayou had no outstanding advances
         to or from unconsolidated affiliated companies. $147,000, $125,000 and
         $64,000 of accounts payable for the years shown is due to an affiliated
         management company.

(7)  Going Concern

      The accompanying consolidated financial statements have been prepared in  
         conformity with generally accepted accounting principles, which
         contemplates continuation of Bayou and Solmecs as going concerns.
         However, both Bayou and Solmecs have sustained recurring losses. In
         addition, neither Bayou or Solmecs have any net working capital and
         both have retained stockholders' deficits, which raises substantial
         doubts as to their ability to continue as going concerns.

      Bayou anticipates that it will be able to defer repayment of certain of
         its short term loan commitments until it has sufficient liquidity to
         enable these loans to be repaid or other arrangements to be put in
         place.

      In addition Bayou has historically relied on loans and advances from
         corporations affiliated with the President of Bayou. Based on
         discussions with these affiliate companies, Bayou believes this source
         of funding will continue to be available.

      Other than the arrangements noted above, Bayou has not confirmed any other
         arrangements for ongoing funding. As a result Bayou may be required to
         raise funds by additional debt or equity offerings in order to meet its
         cash flow requirements during the forthcoming year.

(8)  Commitments

      Solmecs has entered into the following commitments:

      (a) B.G. Negev Technology and Application Ltd. (AP) and the Ben Gurion
          University of the Negev - The Research and Development Authority
          (RDA), jointly and severally (APRDA):

      In accordance with an agreement dated November 5, 1981, between Solmecs,
          Ben-Gurion University and APRDA, Solmecs' subsidiary is continuing
          research and development (R&D) projects which were previously carried
          out by APRDA on the campus of Ben-Gurion University. It was further
          agreed that the University would enable the projects to continue on 
          its campus in consideration for a fee for the use of the facilities.


                                       9
<PAGE>   10

                    BAYOU INTERNATIONAL, LTD. AND SUBSIDIARY
                   Notes to Consolidated Financial Statements
                      September 30, 1997, June 30, 1997 and
                               September 30, 1996

(8)  Commitments (continued)

      Solmecs owns the patents connected with these projects and agreed to pay
          royalties to APRDA at the rate of 1.75% on sales of products and at
          the rate of 11.5% on income from licensing fees.

      Solmecs also agreed to assume the obligations of APRDA to pay royalties to
          the Ministry of Energy on products developed from these R&D projects
          for its participation in the research and development cost of APRDA.
          As of June 30, 1997, this liability amounted to approximately
          US$308,000 (including linkage to the Consumer Price Index and
          interest at 4% per annum). Subsequent to the repayment of the
          liability, Solmecs is to pay royalties to the Ministry of Energy
          (ME) at a reduced rate.

      Through September 30, 1997, there were no sales or income on which
          royalties were payable to APRDA or the ME.

      (b) International Lead Zinc Research Organization (ILZRO)

      In connection with a research contract with ILZRO, Solmecs' subsidiary
          agreed to pay ILZRO a fee for any lead used in future production by
          the subsidiary. The total fee commitment is limited to US$1,864,000.
          Through September 30, 1997, the subsidiary has not used any lead for
          which it is required to pay fees.

      (c) Chief Scientist of the Government of Israel

      For the period from 1981 to 1991, Solmecs' subsidiary received
          participation from the Chief Scientist of US$2,274,420 towards the
          cost of a research and development project. In return, the
          subsidiary is required to pay royalties at the rate of 2% of sales
          of know-how or products derived from the project. Through September
          30, 1997, no royalties were payable.

(9)  Subsequent Events

      In March 1997, Bayou commenced negotiations with SCNV Acquisition Corp
          ("SCNV") for the sale of Bayou's subsidiary Solmecs to SCNV. A
          letter of intent was signed on May 5, 1997 and agreements to effect
          the sale are in the process of being negotiated. It is intended
          that, as part of the sale of Solmecs, Bayou will acquire a 24%
          interest in SCNV.

      The sale of Solmecs is subject to the approval of shareholders of Bayou.
          Following the signing of formal contracts for the sale of Solmecs,
          Bayou will prepare and distribute an Information Memorandum for the
          purpose of seeking shareholder approval.

      In the event that the sale of Solmecs is consummated, of which there
          can be no assurance, Bayou intends to seek other business
          activities, which may be in the fields of energy conversion and
          conservation and/or other industries, including the mineral
          exploration industry. It is the policy of the Board of Directors of
          Bayou that it will not engage in any activities the scope and nature
          of which would subject the Company to the registration and reporting
          requirements of the Investment Company Act of 1940.


                                       10
<PAGE>   11

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

FUND COSTS CONVERSION

The consolidated statements of income and other financial and operating data
contained elsewhere herein and the consolidated balance sheets and financial
results have been reflected in Australian dollars unless otherwise stated.

The following table shows the average rate of exchange of the Australian dollar
as compared to the US dollar during the periods indicated:

      3 months ended Sept 30, 1996 A$1.00 = U.S. $0.7901
      3 months ended Sept 30, 1997 A$1.00 = U.S. $0.7196

RESULTS OF OPERATION

Three Months Ended September 30, 1997 vs. Three Months Ended September 30, 1996.

Revenue of A$6,000 for the three months ended September 30, 1997 compared to A
$5,000 for the three months ended September 30 1996.

Cost and expenses decreased from A$348,000 for the three months ended September
30, 1996 to A$287,000 for the three months ended September 30, 1997. The
decrease is a net result of:

      a)    an increase in interest expense from A$60,000 for the three months
            ended September 30, 1996 to A$69,000 for the three months ended
            September 30, 1997.

      b)    an increase in legal, accounting and professional from A$22,000 for
            the three months ended September 30, 1996 to A$48,000 for the three
            months ended September 30, 1997 due to additional professional fees
            in regard to the Solmecs Prospectus.

      c)    the increase in administrative costs from A$42,000 in the three
            months ended September 30, 1996 to A$147,000 in the three months
            ended September 30, 1997 due to foreign travel increase for
            scientific and business trips.

      d)    a decrease in research and development from A$88,000 in the three
            months ended September 30, 1996 to A$20,000 in the three months
            ended September 30, 1997.

      e)    the decrease in amortisation of goodwill from A$133,000 for the
            three months ended September 30, 1996 to A$nil for the three months
            ended September 30, 1997 as a result of goodwill associated with the
            acquisition of Solmecs in 1987 being fully amortised.

As a result of the foregoing the loss from operations amounted to $A281,000 for
the three months ended September 30, 1997 compared to A$343,000 for the three
months ended September 30, 1996.

The Company incurred a foreign exchange gain of A$251,000 for the three months
ended September 30, 1997 compared to a foreign exchange loss of A$31,000 for the
three months ended September 30, 1996 caused by the movement in the Australian
dollar versus the U.S. dollar. All of the Company's loan accounts are
denominated in U.S. dollars.

The Company incurred a net loss of A$29,000 for the end three months ended
September 30, 1997 compared to a loss of A$374,000 for the end three months
ended September 30, 1996.


                                       11
<PAGE>   12

Liquidity and Capital Resources

As of September 30, 1997 the Company had short term obligations of A$482,000
comprising accounts payable and accrued expenses and owed an amount of
A$3,218,620 to Chevas Pty Ltd of which the President and the Chief Executive
Officer of the Company Mr. J I Gutnick is a Director. The Company has long term
obligations of A$116,038 at September 30, 1997 as a disputed claim due to Ben
Gurion University.

The Company anticipates that it will be able to defer repayment of certain of
its short term loan commitments until it has sufficient liquidity to enable
these loans to be repaid which there can be no assurance. In addition the
Company has historically relied upon loans and advances from affiliates to meet
a significant portion of the Company's cash flow requirements which the Company
believes based on discussions with such affiliates will continue to be available
during fiscal 1997 and 1998.

The Company will still be required to fund Solmecs in order to complete the
development of the next stage of the LMMHD project together with other projects
that Solmecs is developing.

Other than the arrangements above the Company has not confirmed any further
arrangements for ongoing funding. As a result the Company may be required to
raise funds from additional debt or equity offerings and/or increase the
revenues from operations in order to meet its cash flow requirements during the
forthcoming year.


Cautionary Safe Harbor Statement under the United States Private Securities
Litigation Reform Act of 1995.

Certain information contained in this Form 10-Q is forward looking information
within the meaning of the Private Securities Litigation Act of 1995 (the "Act")
which became law in December 1995. In order to obtain the benefits of the "safe
harbor" provisions of the act for any such forwarding looking statements, the
Company wishes to caution investors and prospective investors about significant
factors which among others have affected the Company's actual results and are in
the future likely to affect the Company's actual results and cause them to
differ materially from those expressed in any such forward looking statements.
This Form 10-Q report contains forward looking statements relating to future
financial results. Actual results may differ as a result of factors over which
the Company has no control including the strength of the domestic and foreign
economies, slower than anticipated completion of research and development
projects and movements in the foreign exchange rate. Additional information
which could affect the Company's financial results is included in the Company's
Form 10-K on file with the Securities and Exchange Commission.


                                       12
<PAGE>   13

                                     PART II

Item 1.  LEGAL

         Not Applicable

Item 6.  EXHIBITS AND REPORTS ON FORM 8-K

         The Company did not file any Report on Form 8-K during the three
         months ended September 30, 1997.

Item 5.  OTHER INFORMATION

         Mr Hayden Barry resigned as a Director on October 15, 1997 and Mr
         David Simcox was appointed as a Director of the Company on October
         15, 1997.


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<PAGE>   14

                                   (FORM 10-Q)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereinto duly authorised.

                        BAYOU INTERNATIONAL, LTD.


                        By:
                                /s/ David H. Simcox
                                  ------------------------
                                    David H. Simcox
                                    Director


Dated: May 7, 1998  By:
                                /s/ Peter Lee
                                   -------------------------

                                    Peter Lee
                                    Director, Assistant Secretary and Chief
                                    Financial Officer
                                    (Principal Financial Officer)


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