<PAGE>
                                 UNITED STATES
                      SECURITIES AND EXCHANGE COMMISSION
                          Washington, D.C. 20549-1004


                                  FORM 10-K 

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

For the Year Ended December 31, 1998

Commission File Number 0-7205

                            HOLIDAY-GULF HOMES, INC.
             (Exact name of registrant as specified in its charter)


           Minnesota                                    41-0916277
 (State or other jurisdiction of                     (I.R.S. Employer 
 incorporation or organization)                      Identification No.)

4804 Mile Stretch Drive, Holiday, Florida                     34690
(Address of principal executive office)                    (Zip Code)

Registrant's telephone number, including area code      (727)  937-3293


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

                YES          X                    NO

The number of shares outstanding of each of the issuer's classes of common
stock as of December 31, 1998.


Common Stock, $.01 Par Value - 1,903,853 shares


The aggregate market value of the voting stock held by non-affiliates of the
registrant as of December 31, 1998.


Common Stock, $.01 Par Value - $ 197,676




<PAGE>
                                    PART I

ITEM 1. BUSINESS

(a)  General Business

     The majority of revenues for the 1998, 1997, and 1996 years were derived
from the water and garbage operations of two subsidiaries. Presently the
management of Holiday-Gulf Homes, Inc. believes these subsidiaries will
continue to provide a majority of the revenue.

(b)  Narrative Description of Business

     The Company has two utility company subsidiaries and a land development
subsidiary.  The utility subsidiaries represent the operating source of
revenue.  These companies bill customers on a monthly basis for water and
garbage charges.  The utility companies are operated by an outside contractor. 
The rates charged by the utility companies are set by the Florida Public
Service Commission.

Patents, etc.

     There are no patents, licenses, franchises or concessions held by the
Company which it deems important and material for an understanding of its
business.

Research and Development

     No money was spent by the Company during the years ended December 31,
1998, 1997, and 1996 on research activities.

Federal, State, and Local Regulations

     The utility subsidiaries are subject to the Florida Public Service
Commission regulations.  There are no material estimated capital expenditures
for the current or succeeding years.  All reports required by the Florida
Public Service Commission have been filed.

Personnel

     The Company as of December 31, 1998, employed one person full time.  The
Company's employee is not represented by a union.

Seasonal Factors

     The Company's operations as a whole are not significantly affected by
seasonal factors.


 

<PAGE>
ITEM 1. BUSINESS (CONTINUED)

Competitive Conditions

     The utility subsidiaries are regulated by a public authority, therefore
there are no competitive conditions.


ITEM 2. PROPERTIES

     The Company's activities are presently conducted primarily in Pasco
County, Florida.  All of the Company's facilities are well maintained and
believed to be in good condition.

     The following is a description of the location and general character of
property owned by the Company and its subsidiaries.

     (a)  The land development subsidiary owns a warehouse and office  complex 
          located in New Port Richey, Florida for which they receive rent on 
          a monthly basis.  The  annual rents and late fees totaled $38,812 
          for 1998, $38,303 for 1997, and $36,213 for 1996.

     (b)  The Company owns five well lots where Crestridge Utility Corporation 
          is located.  These lots house the pumping station and wells.

     (c)  The Company owns two well lots where Holiday Gardens Utilities, Inc. 
          is located.  These lots house the pumping station and wells.


ITEM 3. LEGAL PROCEEDINGS

     None.


ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     (a)   Annual  meeting of  stockholders  was held  June 27, 1998  for the 
           December 31, 1997  year.

     (b)   Elected directors and executive officers for the upcoming 1998 year 
           were:

                Linda Emerick     - Director and President
                Thomas L. Burkett - Director and Vice President
                Ronnie L. Mohr    - Director and Secretary
                Eileen M. Falla   - Treasurer

     (c)   Other matters voted upon and the number of affirmative votes and 
           negative votes cast with respect to each such matter.

                 None.

<PAGE>
                                    PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON STOCK AND RELATED SHAREHOLDER MATTERS

     Holiday-Gulf Homes, Inc.'s Common stock is traded on the over the counter
market.  Generally, excluding limited or sporadic quotations, there is no
market for such stock.  The number of record holders of Holiday-Gulf Homes,
Inc. Common Stock at December 31, 1998 was 456.

     The Company distributed dividends of $95,192 in July, 1998, $95,193 in
January, 1997, $95,193 in April, 1995, $95,192 in April, 1993, $95,192 in
October, 1990, $95,192 in December, 1989 and $95,192 in March, 1988. For the
ten years prior to the 1988 dividend the Company had not made any
distributions.


ITEM 6. SELECTED FINANCIAL DATA
                                            YEARS ENDED DECEMBER 31,

                                                                   RESTATED
                                        1998          1997           1996

Utility Revenues                     $ 280,045     $ 280,803      $ 277,670

Net Income Before Provision For
  Income Taxes                       $  60,104     $  57,137      $  58,110

Net Income Per Common Share 
  Before Provision For Income Taxes  $    .032     $    .030      $    .031 

Net Income                           $  47,604     $  45,237      $  46,092

Net Income Per Common Share          $    .025     $    .024      $    .024

Total Assets                         $ 216,829     $ 262,781      $ 312,488

Long-Term Debt                       $   -0-       $   -0-        $   -0-

Cash Dividends Declared Per Share    $    .050     $    .050      $   -0-   


ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND     
        RESULTS OF OPERATIONS

(a)  Liquidity and Capital Resources

     The Company maintains 55% of its assets in cash and other current assets.
At present there are no plans for expansion and no material repairs are
anticipated for the utility companies. the Company has been maintaining the
water lines and meters on a regular basis.


<PAGE>
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND     
        RESULTS OF OPERATIONS (CONTINUED)

(b)  Results of Operations

     The majority of the revenues are generated by the utility companies. The
companies completed a rate increase audit with the Public Service Commission
in 1992. The new rates became effective in 1993.

     The rates increased in 1998, 1997 and 1996 due to indexing.

     Utility operating revenues decreased .27% in 1998 to $280,045, down $758
from 1997 and increased 1.13% in 1997, up $3,133 over 1996.  The increase in
1997 was due primarily to rate increases in water revenues and usage.

     The gross profit percentages for the years 1998, 1997 and 1996 of 53.13%, 
51.16% and 50.55%, respectively, were maintained due to the stability in the
number of customers. The main difference in 1998 was due to one month free
garbage service, due to a change in vendors and an overall review by
management to keep costs down.

     General and administrative expenses have increased as a percentage of
utility revenues in 1998 compared to 1997 and 1996 as a  result  of  increased 
expenditures for insurance, stock agent fees, wages and related taxes and
office supplies.  General and administrative expenses as a percentage of
utility revenues were approximately 30.75% in 1998 as compared to 30.52% and 
29.20% for 1997 and 1996.

     Income from other operations increased 2.27% in 1998 to $42,627, up $945 
over 1997 and increased 3.00% in 1997, up $1,215 over 1996.  The increase in
revenues is due primarily to increases in rental income.

     General and administrative expenses from other operations have increased
as a percentage of income from other operations in 1998 compared to 1997, and
1996 as a result of an increase in management costs.  General and 
administrative expenses from other operations as a percentage of income from
other operations were approximately 79.68% in 1998 as compared to 75.12% and
75.51% for 1997 and 1996.

     Net income increased 5.23% in 1998 to $47,604, up $2,367 from 1997 and 
decreased 1.86% in 1997, down $855 from 1996.

(c)  Other Matters
     The Y2K Issue

     The Company is currently reviewing the risk of potential interruptions
that may occur from the year 2000 (Y2K) issue. The Company does not anticipate
any major implications. The vendors the Company deals with have indicated to
management they will be ready for the year 2000. The Company is still
reviewing their compliance with the year 2000, and anticipates everything to
be in place by September, 1999. 

<PAGE>
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     The following financial statements of Holiday-Gulf Homes, Inc., included
in the annual report to shareholders are incorporated herein by reference:

          Consolidated Balance Sheets - December 31, 1998 and 1997

          Consolidated Statements of Operations - Years ended December 31,  
          1998, 1997, and 1996

          Consolidated Statements of Shareholders' Equity - Years  ended    
          December 31, 1998, 1997, and 1996

          Consolidated Statements of Cash Flows - Years ended December 31,  
          1998, 1997, and 1996

          Notes to Consolidated Financial Statements - December 31, 1998


ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND     
        FINANCIAL DISCLOSURE

     None.





























<PAGE>
                                    PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

            NAME           AGE    BUSINESS EXPERIENCE AND OTHER DIRECTORSHIPS


      Linda Emerick         53     Director  and  President  of  Holiday-Gulf
                                    Homes,  Inc.  since  June  23, 1987.  Mrs. 
                                    Emerick serves as Chief Executive Officer. 
                                    Emerick  was  a  Director  and  Secretary- 
                                    Treasurer  of Hillrow,  Inc.  July, 1966 
                                    through June, 1989.   She  is  currently 
                                    operating a consulting  and  management 
                                    service.

      Thomas L. Burkett     61     Director and  Vice  President of  Holiday-
                                    Gulf Homes, Inc. since June 23, 1987. Mr. 
                                    Burkett is  retired from 31 years District 
                                    Sales Manager with Gehl Company of West 
                                    Bend, WI. He is currently associated with 
                                    Fraley  Truck & Implement Sales,  Inc., 
                                    Rushville, IN.

      Ronnie L. Mohr        50     Director  and  Secretary  of  Holiday-Gulf
                                    Homes, Inc. since December 29, 1992.  Mr. 
                                    Mohr has  been engaged  in farming for 35 
                                    years and has  been a Director and Board 
                                    Chairman of R & S Mohr Family Farms, Inc. 
                                    since  1981.   He  is  on  the  Board  of 
                                    Directors of Ag-One Coop, Inc.; Central 
                                    Indiana  Power;  Wabash  Valley   Power 
                                    Association, Inc.; and Land O'Lakes, Inc.

      Eileen M. Falla       52     Treasurer  of  Holiday-Gulf   Homes,  Inc.
                                    since June 23, 1987.  Mrs. Falla has been 
                                    employed by Holiday-Gulf Homes,Inc. since 
                                    October, 1983 and is the Utilities Billing 
                                    Clerk.













<PAGE>
ITEM 11. EXECUTIVE COMPENSATION

     No executive officer of the Company received cash compensation in excess
of $20,000.

     The Company has no annuity, pension or retirement plans.  There are no
life, health, hospitalization or medical reimbursement plans other than group
plans which are available generally to all salaried employees.

     There are no remuneration payments proposed to the officers or directors
to be made in the future directly or indirectly by the Company or any of its
subsidiaries pursuant to any existing plan or agreement.

     Each director is reimbursed for travel and other expenses related to
attendance at directors' meetings.  The directors receive a fee ranging from
$4,200 to $20,000 per year.

     There were no stock appreciation rights or options to purchase securities
from the Company granted to, exercised by, or realized by an officer or
director of the Company during the fiscal years ended December 31, 1998, 1997
and 1996.

     There were no loans from directors as of December 31, 1998 and 1997.





























<PAGE>
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The following table sets forth information, as of December 31, 1998, with
respect to the ownership of Common Stock by all shareholders known by the
Company to be the beneficial owners of more than 5% of its outstanding Common
Stock, all directors, and all directors and officers of the Company as a
group.  The percentages stated are based upon 1,903,853 issued shares of
Common Stock.

                                       AMOUNT OF BENEFICIAL        PERCENTAGE
                                            OWNERSHIP               OF TOTAL
         NAME AND ADDRESS               (NUMBER OF SHARES)           SHARES

Anita Jane Duckworth                        260,000                   13.66%
3242 W Old Franklin Rd
Shelbyville, Indiana

Fred W. Garver                              154,000                    8.09%
3831 N London Rd
Fairland, Indiana

Linda & Wray Emerick                         43,642                    2.29%
8318 W 600 South
Edinburgh, Indiana
(Linda - Director & Officer)

Donald R. Pence                             220,500                   11.58%
6598 W 1150 S
Edinburgh, Indiana

E.J. Terpstra                               110,000                    5.78%
4681 N State Rd 9
Shelbyville, Indiana

Ronnie & Sarah Mohr                         202,000                   10.61%
5200 E 600 N
Greenfield, Indiana
(Ronnie - Director & Officer)

Thomas L. Burkett                            50,000                    2.63%
1609 N Fort Wayne Rd
Rushville, Indiana
(Director & Officer)

All Directors and Officers as a group (3)   295,642                   15.53%


ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

      None.


<PAGE>
                                   PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

     (a)  Exhibits and financial statement schedules

     1.  Financial Statements

     Among responses to this ITEM 14 are the following financial statements
which are incorporated herein by reference in ITEM 8 above:

            (  i)  Consolidated Balance Sheets - December 31, 1998 and 1997.

            ( ii)  Consolidated Statements of Operations - Years ended      
                   December 31, 1998, 1997, and 1996.

            (iii)  Consolidated Statements of Shareholders' Equity - Years  
                   ended December 31, 1998, 1997, and 1996.

            ( iv)  Consolidated Statements of Cash Flows - Years ended      
                   December 31, 1998, 1997, and 1996.

            (  v)  Notes to Consolidated Financial Statements - December 31, 
                   1998.

     2.  Supplementary Data and Financial Statement Schedules

            (  i)  None.                                                    
 
     3.  Exhibits required by Item 601 of Regulation S-K.

            ( 22) Subsidiaries of the Company.

                                                      PERCENTAGE OF SECURITIES
                                   JURISDICTION OF    DIRECTLY OR INDIRECTLY
           NAME                     INCORPORATION     OWNED BY THE COMPANY

Holiday-Gulf Builders, Inc.            Florida                  100%

Crestridge Utility Corporation         Florida                  100%

Holiday Gardens Utilities, Inc.        Florida                  100%


     (b) Reports on Form 8-K

         No reports on Form 8-K have been filed during the last quarter of the
period covered by this report.




<PAGE>
                                    SIGNATURES

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


                           HOLIDAY-GULF HOMES, INC.
                                (Registrant)


By: (Signature and Title)


Date:  March 29, 1999


     Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.


(Signature and Title)
                    Linda Emerick, President and Director


Date:



(Signature and Title)
                    Thomas L. Burkett, Vice President and Director


Date:



(Signature and Title)
                    Ronnie L. Mohr, Secretary and Director


Date:



(Signature and Title)
                    Eileen M. Falla, Treasurer


Date:

<PAGE>
<AUDIT-REPORT>







INDEPENDENT AUDITORS' REPORT

To the Shareholders and Board of Directors
Holiday-Gulf Homes, Inc. and Subsidiaries
Holiday, Florida

     We have audited the accompanying consolidated balance sheets of HOLIDAY-
GULF HOMES, INC. (a Minnesota corporation) AND SUBSIDIARIES as of December 31, 
1998  and  1997, and  the related  consolidated  statements  of  operations, 
shareholders' equity, and cash flows for the years ended December 31, 1998,
1997 and 1996.  These consolidated financial statements are the responsibility
of the Company's management.  Our responsibility is to express an opinion on
these consolidated financial statements based on our audits.

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

     In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the consolidated financial position
of Holiday-Gulf Homes, Inc. and Subsidiaries, as of December 31, 1998 and
1997, and the consolidated results of their operations and their cash flows
for the years ended December 31, 1998, 1997 and 1996 in conformity with
generally accepted accounting principles.

     As described in Note 8 to the financial statements, the Company changed
the method of accounting for income taxes.


                                          ARNOLD AND CO., P.A.


January 12, 1999





</AUDIT-REPORT>

<TABLE>
                          HOLIDAY-GULF HOMES, INC. AND SUBSIDIARIES
                                 CONSOLIDATED BALANCE SHEETS
                                 DECEMBER 31, 1998 AND 1997
<CAPTION>
ASSETS

                                                                                
                                                                1998              1997
<S>                                                         <C>               <C>
WATER, PLANT AND EQUIPMENT

  Water Plant & Equipment, at Original Costs                $    311,787      $    302,023
    Less:  Accumulated Depreciation                             (242,195)         (234,404)
    Less:  CIAC, Net of Amortization of $290 in
           1998 and $207 in 1997                                  (1,035)           (1,118)
                                                            ------------      ------------
Net Water Plant & Equipment                                 $     68,557      $     66,501
                                                            ------------      ------------
OTHER PROPERTY AND INVESTMENTS

  Non-Utility Property less Accumulated
    Depreciation of $53,214 in 1998 and
    $49,700 in 1997                                         $     23,025      $     24,164
                                                            ------------      ------------
Net Other Property & Investments                            $     23,025      $     24,164
                                                            ------------      ------------
CURRENT ASSETS

  Cash and Certificates of Deposits                         $     96,069      $    129,478
  Accounts Receivable                                              3,904             4,778
  Prepaids                                                         4,862             4,089
  Other Receivables                                                4,877             4,549
  Deferred Tax Benefit                                            10,000            10,000
                                                            ------------      ------------
Total Current Assets                                        $    119,712      $    152,894
                                                            ------------      ------------
OTHER ASSETS

  Prepaids                                                  $      -0-               1,187
  Deposits                                                         2,035             2,035
Deferred Tax Benefit                                               3,500            16,000
                                                            ------------      ------------
Total Other Assets                                          $      5,535      $     19,222
                                                            ------------      ------------

TOTAL ASSETS                                                $    216,829      $    262,781
                                                            ============      ============
<FN>
                  See accompanying notes and independent auditors' report.
</FN>
</TABLE>
<TABLE>
                          HOLIDAY-GULF HOMES, INC. AND SUBSIDIARIES
                                 CONSOLIDATED BALANCE SHEETS
                                 DECEMBER 31, 1998 AND 1997
<CAPTION>
SHAREHOLDERS' EQUITY AND LIABILITIES

                                                                                
                                                                1998              1997
<S>                                                         <C>               <C>
SHAREHOLDERS' EQUITY

  Capital Stock, 5,000,000 shares authorized
    and 1,903,853  shares issued  and
    outstanding in 1998 and 1997                            $     19,039      $     19,039
  Paid-In-Capital                                                116,808           164,396
  Retained Earnings (of which $12,403 as of
    December 31, 1998 and $10,102 as of December 31, 
    1997 and 1996 was appropriated for unclaimed 1997
    1995, 1993, 1990, 1989 and 1988 dividends.)                   61,829            59,528
                                                            ------------      ------------
Total Shareholders' Equity                                  $    197,676      $    242,963
                                                            ------------      ------------
  
CURRENT LIABILITIES

  Accounts Payable                                          $     17,965      $     18,232
  Accrued Liabilities                                               -                 -   
  Deferred Income                                                  1,188             1,586
                                                            ------------      ------------
Total Current Liabilities                                   $     19,153      $     19,818
                                                            ------------      ------------

TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES                  $    216,829      $    262,781 
                                                            ============      ============













<FN>
                   See accompanying notes and independent auditors' report.
</FN>
</TABLE>
<TABLE>
                          HOLIDAY-GULF HOMES, INC. AND SUBSIDIARIES
                            CONSOLIDATED STATEMENTS OF OPERATIONS
                    FOR THE YEARS ENDED DECEMBER 31, 1998, 1997, AND 1996

<CAPTION>
                                                                                  RESTATED
                                          1998                  1997                1996
<S>                                   <C>                    <C>                 <C> 
OPERATING REVENUES
  Water                               $   135,994            $  136,401          $  133,874
  Garbage                                 107,362               107,503             107,345
  Streetlights                             34,784                34,799              34,816
  Transfer & Reconnect Fees                 1,905                 2,100               1,635
                                      -----------            ----------          ----------
Total Operating Revenues              $   280,045            $  280,803          $  277,670
                                      -----------            ----------          ----------

COST OF SALES
  Garbage                             $    76,706            $   83,680          $   83,680
  Electric                                  5,893                 5,898               5,876
  Streetlights                             14,419                14,429              14,409
  Other Costs                              34,239                33,143              33,349
                                      -----------            ----------          ----------
Total Cost of Sales                   $   131,257            $  137,150          $  137,314
                                      -----------            ----------          ----------
 
Gross Profit                          $   148,788            $  143,653          $  140,356


OPERATING EXPENSES
  Depreciation & Amortization         $     8,343            $    8,119          $    7,842
  General & Administration                 86,123                85,700              81,077
                                      -----------            ----------          ----------
Total Operating Expenses              $    94,466            $   93,819          $   88,919
                                      -----------            ----------          ----------

Operating Income                      $    54,322            $   49,834          $   51,437


OTHER INCOME
  Rental and Late Fees                $    38,812            $   38,303          $   36,213
  Interest                                  3,815                 3,379               4,254
                                      -----------            ----------          ----------
Total Other Income                    $    42,627            $   41,682          $   40,467
                                      -----------            ----------          ----------


<FN>
                   See accompanying notes and independent auditors' report.
</FN>

                          HOLIDAY-GULF HOMES, INC. AND SUBSIDIARIES
                            CONSOLIATED STATEMENTS OF OPERATIONS
                    FOR THE YEARS ENDED DECEMBER 31, 1998, 1997, AND 1996


                                                                                  RESTATED
                                          1998                  1997                1996

OTHER OPERATING EXPENSES
  General and Administrative          $    33,966            $   31,313          $   30,555
  Depreciation                              2,879                 3,066               3,239
                                      -----------            ----------          ----------
Total Other Operating Expenses        $    36,845            $   34,379          $   33,794
                                      -----------            ----------          ----------

Other Net Income, on Non-Utility      $     5,782            $    7,303          $    6,673
                                      -----------            ----------          ----------

Net Income Before Provision
    For Income Taxes                  $    60,104            $   57,137          $   58,110

PROVISION FOR INCOME TAXES            $    12,500            $   11,900          $   12,018
                                      -----------            ----------          ----------

NET INCOME                            $    47,604            $   45,237          $   46,092
                                      ===========            ==========          ==========


EARNINGS PER SHARE                    $      .025            $     .024          $     .024
                                      ===========            ==========          ==========


















<FN>
                 See accompanying notes and independent auditors' report.
</FN>
</TABLE>
<TABLE>
                          HOLIDAY-GULF HOMES, INC. AND SUBSIDIARIES
                       CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
                    FOR THE YEARS ENDED DECEMBER 31, 1998, 1997, AND 1996

<CAPTION>
                                                                                
                                                   APPROPRIATED UNAPPROPRIATED   TOTAL
                     COMMON STOCK       PAID IN     RETAINED      RETAINED     SHAREHOLDERS'
                  SHARES      AMOUNT    CAPITAL     EARNINGS      EARNINGS       EQUITY
<S>               <C>        <C>       <C>         <C>          <C>            <C> 
Restated
December 31, 1995 1,903,853  $ 19,039  $ 214,352   $  7,882     $   3,334      $ 244,607
                  ---------  --------  ---------   --------     ---------      ---------
Return of Unclaimed
  1995 Dividends       -         -          -         2,220          -             2,220

Net Income (Restated)  -         -          -          -           46,092         46,092
                  ---------  --------  ---------   --------     ---------      ---------
Restated
December 31, 1996 1,903,853  $ 19,039  $ 214,352   $ 10,102     $  49,426      $ 292,919
                  ---------  --------  ---------   --------     ---------      --------- 
Payment of 1997
  Dividends (.05 Per
  Share)               -         -       (49,956)      -          (45,237)       (95,193)

Net Income (Restated)  -         -          -          -           45,237         45,237
                  ---------  --------  ---------   --------     ---------      ---------

December 31, 1997 1,903,853  $ 19,039  $ 164,396   $ 10,102     $  49,426      $ 242,963
                  ---------  --------  ---------   --------     ---------      ---------
Return of Unclaimed
  1997 Dividends       -         -          -         2,301          -             2,301  

Payment of 1998
  Dividends (.05 Per
  Share)               -         -       (47,588)      -          (47,604)       (95,192)

Net Income             -         -          -          -           47,604         47,604
                  ---------  --------  ---------   --------     ---------      ---------

December 31, 1998 1,903 853  $ 19,039  $ 116,808   $ 12,403     $  49,426      $ 197,676
                  =========  ========  =========   ========     =========      =========





<FN>
                   See accompanying notes and independent auditors' report.
</FN>
</TABLE>
<TABLE>
                          HOLIDAY-GULF HOMES, INC. AND SUBSIDIARIES
                            CONSOLIDATED STATEMENTS OF CASH FLOWS
                    FOR THE YEARS ENDED DECEMBER 31, 1998, 1997, AND 1996
<CAPTION>
                                                                                  RESTATED
                                                    1998            1997            1996
<S>                                              <C>             <C>             <C>
Cash flows from operating activities
  Net Income                                     $   47,604      $   45,237      $   46,092
Adjustments to reconcile net income to net 
  cash provided by operating activities:
    Depreciation and Amortization                    11,222          11,185          11,080
Change in assets and liabilities
  (Increase) decrease in
     Receivables                                        546             320          (6,349)
     Other Assets                                     1,187           -0-             -0-   
     Prepaid Assets                                    (773)         (2,238)           (237)
     Deferred Tax Benefit (Note 8)                   12,500          11,900          12,018
   Increase (decrease) in
     Accounts Payable                                  (267)          1,462             776 
     Accrued Expenses & Deferred Income                (398)         (1,213)            583
                                                 ----------      ----------      ----------
Net cash provided by operating activities        $   71,621      $   66,653      $   63,963
                                                 ----------      ----------      ----------
Cash flows from investing activities
    Improvements to Utility Company Equipment    $   (9,764)     $   (9,032)     $   (2,249)
    Office Complex Improvements                      (2,375)           (981)         (6,572)
                                                 ----------      ----------      ----------
Net cash used in investing activities            $  (12,139)     $  (10,013)     $   (8,821)
                                                 ----------      ----------      ----------
Cash flows from financing activities
    Payment of Dividends                         $  (95,192)     $  (95,193)     $    -0-   
    Return of Unpaid Dividends                        2,301           -0-             2,220
                                                 ----------      ----------      ----------
Net cash provided by (used in) financing
  activities                                     $  (92,891)     $  (95,193)     $    2,220
                                                 ----------      ----------      ----------

Net increase (decrease) in cash                  $  (33,409)     $  (38,553)     $   57,362

Cash at beginning of year                        $  129,478      $  168,031      $  110,669
                                                 ----------      ----------      ----------
Cash at end of year                              $   96,069      $  129,478      $  168,031
                                                 ==========      ==========      ==========
Supplementary Disclosures of Cash Flow Information 
    Interest Paid                                $    -0-        $    -0-        $    -0-
    Income Tax Paid                              $    -0-        $    -0-        $    -0-
<FN>
                   See accompanying notes and independent auditors' report.
</FN>
</TABLE>
<PAGE>
                  HOLIDAY-GULF HOMES, INC. AND SUBSIDIARIES
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


(1) - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

Organization--
   
     The Company consists of two utility companies and a land development
company. These companies are located in Pasco County, Florida. The utility
companies generate revenues by selling water, garbage and streetlight
services. These companies bill customers on a monthly basis for these
services. The utility companies contract with outside parties to provide the
garbage services. The rates charged by the utility companies are set by the
Florida Public Service Commission.

     The land development company owns an office building/warehouse rental
operation. There are no plans in the future to develope anything.

Principles of Consolidation--

     The accompanying consolidated financial statements include the accounts
of the Company and its wholly owned subsidiaries.  All significant
intercompany balances and transactions have been eliminated in consolidation.

Recognition of Income from Utility Operations--

     The majority of the Company's revenues are generated by two Utility
Companies.  These Companies recognize revenues on a monthly basis. The use is
based on actual meter readings by an outside independent contractor.  The
independent contractor also provides services for other utility companies in
the area.  The independent contractors fees are based on a set amount per
customer plus any additional repairs. Since the meter reading is not done on
the last day of the month, there is some unbilled revenue not recorded.

Depreciation--

     Depreciation included in the accompanying financial statements has been
provided by the straight-line method at rates calculated to amortize the cost
of the assets over their estimated useful lives as follows:

                                                               YEARS
         Utility Plant and Equipment                           5 - 40
         Building and Improvements                             5 - 30

     Maintenance and repairs of property and equipment are charged to expense
as incurred,  whereas renewals and betterments are capitalized.  When
properties are replaced, retired, or otherwise disposed of, the cost and
related accumulated depreciation are removed from the accounts.  Any gain or
loss, is credited or charged to operations in the year of disposal.


<PAGE>
                   HOLIDAY-GULF HOMES, INC AND SUBSIDIARIES
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


(1) - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: (CONTINUED)

Amortization--

     The Contribution in Aide of Construction (CIAC) costs are being amortized
over a period of sixteen years using the straight-line method.

     CIAC represents $1,325 received in 1995 from a utility customer to help
pay for the cost of the new asset.

Cash and Cash Equivalents--

     For the purpose of the statement of cash flows, cash includes cash on
hand, cash in checking and money market accounts, and Certificates of Deposit.
The company considers all certificates of deposit with a maturity of one year
or less as a current cash or cash equivalent.

Accounts Receivable--

     The accounts receivable represent amounts due from customers for monthly
streetlight, garbage and water service. Based on managements review of
accounts receivable, no allowance for doubtful accounts is considered
necessary.

Concentration of Credit Risk--

     Management does not believe a credit risk for accounts receivable exists
because the amounts are due from a large number of customers for very small
amounts, and past performance has shown the accounts receivable will be
collected.

Deferred Income--

     Deferred Income represents monies prepaid by customers which have not
been earned.

Allocation of Dividends--

     To the extent dividends were paid in excess of current years earnings and
profits, they have been allocated against paid in capital.








<PAGE>
                   HOLIDAY-GULF HOMES, INC. AND SUBSIDIARIES
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


(1) - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: (CONTINUED)

Income Taxes--

     The Company and its subsidiaries file consolidated Federal and State
Income Tax Returns.

      Deferred income taxes are provided on temporary differences between book
and tax income, arising primarily from the use of different methods of
depreciation, valuing inventory and providing an allowance for doubtful
accounts and notes receivable for financial statement purposes. Deferred
income tax benefits are recognized for operating losses, if available, to
offset future federal income taxes. An allowance is provided if it is more
likely than not that the Company will not realize the benefits of a deferred
tax asset.

Earnings Per Share--

     Earnings per share of Common Stock is computed based upon weighted
average number of shares outstanding for the year (1,903,853 shares in 1998,
1997 and 1996).

(2) - LONG-TERM DEBT:

     There was no debt at the end of 1998 or 1997.

(3) - STOCK OPTION PLAN:

     The Company has adopted a qualified stock option plan whereby options may
be granted  to key employees to purchase a maximum 50,000 shares of the
Company's common stock at not less than 10% of the fair market value of the
shares at date of grant.  The options are exercisable in installments of not
more than 20%  of the shares covered thereby during any one-year period,
subject to the right of cumulation.  The options expire five years from the
date of grant.  No options have been granted under this plan.












<PAGE>

                   HOLIDAY-GULF HOMES, INC. AND SUBSIDIARIES
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


(4) - PROPERTY AND EQUIPMENT:

     The property and equipment accounts consisted of the following at
December  31, 1998 and December 31, 1997:
                                                  1998              1997    

        Land, Buildings, Office
          Equipment and Furniture           $     76,239      $     73,864
        Water, Plant and Equipment               311,787           302,023
        CIAC, Net of Amortization                 (1,035)           (1,118)
                                            ------------      ------------ 
            Total Property and Equipment    $    386,991      $    374,769
        Less: Accumulated Depreciation          (295,409)         (284,104)
                                            ------------      ------------
            Net Property and Equipment      $     91,582      $     90,665
                                            ============      ============


(5) - RELATED PARTY TRANSACTIONS:

     There were no related party transactions during the 1998 and 1997 years.

(6) - LEASES AND LEASE COMMITMENTS:

     The Company is leasing office space in Knollwood Plaza under a three-year
lease expiring in October, 1999. The lease was $450 per month until the
landlord and management agreed to increase to $485 per month, effective
November 1, 1998. The rent paid in 1998 was $5,470, 1997 was $5,400 and in
1996 was $5,400.

     The following is a schedule of future minimum lease payments:

          December 31, 1999         $  4,850
                                    --------
            Total                   $  4,850
                                    ========


     The Company owns an office/warehouse rental facility consisting of three
tenants. Two have month to month leases. The other lease is a five year lease
which was renewed in June, 1995.






<PAGE>
                   HOLIDAY-GULF HOMES, INC. AND SUBSIDIARIES
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


(6) - LEASES AND LEASE COMMITMENTS: (CONTINUED)

     The minimum payments under this lease are as follows as of December 31,
1998:

                      1999                 $ 35,420
                      2000                   18,060
                      2001                    -0-
                      2002                    -0-
                      2003 and thereafter     -0-
                                           --------
                       Total Due           $ 53,480 
                                           ======== 

     The rental real estate held for lease is located in New Port Richey,
Florida. The company's investment in this rental property is as follows at
December 31, 1998:

      Warehouse and Office Building        $ 29,323
      Improvements                           43,390
                                           --------
                                           $ 72,713

      Less: Accumulated Depreciation         51,344
                                           --------
                                           $ 21,369
                                           ========

(7) - INCOME TAXES:

      Deferred income taxes (benefits) are provided for certain income and
expenses which are recognized in different periods for tax and financial
reporting purposes. Sources of temporary differences and the resulting tax
assets and liabilities are as follows:

                                           1998        1997        1996

      Net Operating Loss Carryforwards $ 183,078   $ 243,831   $ 302,151
                                       ---------   ---------   ---------

      Applicable Tax Rate
           (15% Federal, 5.5% State)   $  37,200   $  49,700   $  61,600

      Valuation Allowance                (23,700)    (23,700)    (23,700)
                                       ---------   ---------   ---------
      Amount Per Balance Sheet         $  13,500   $  26,000   $  37,900
                                       =========   =========   =========
<PAGE>
                   HOLIDAY-GULF HOMES, INC. AND SUBSIDIARIES
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


(7) - INCOME TAXES: (CONTINUED)

    The provision (benefit) for income taxes consist of the following:

                                                              RESTATED
                                            1998      1997      1996

           Current                          -0-        -0-       -0-
           Deferred                      $ 12,500   $ 11,900  $ 12,018 


    Income Tax Expense Consisted of the following:

                                                              RESTATED
                                            1998       1997      1996

    Provision for income taxes:

           Federal Income Tax            $  9,430   $  9,000  $  9,040

           State Income Tax                 3,070      2,900     2,978
                                         --------   --------  --------
                                         $ 12,500   $ 11,900  $ 12,018
                                         ========   ========  ========


    The reconciliation of income computed at the U.S. federal  statutory  tax 
rates (34%) to income tax expense is:
                                                               RESTATED
                             1998              1997              1996
                        AMOUNT  PERCENT   AMOUNT  PERCENT   AMOUNT  PERCENT

    Tax at U.S.
      Statutory rates $ 20,435    34.00  $ 19,427   34.00  $ 19,757   34.00
    Surtax exemption   (11,225)  (18.67)  (10,829) (18.95)  (11,067) (19.04)
    State income tax-
      net of federal
      tax benefits       3,070     5.10     2,900    5.08     2,978    5.12
    Permanent
      differencies
      and other            220      .37       402     .70       350     .60
                      --------    -----  --------   -----  --------   -----
                      $ 12,500    20.80  $ 11,900   20.83  $ 12,018   20.68
                      ========    =====  ========   =====  ========   =====



<PAGE> 
                   HOLIDAY-GULF HOMES, INC. AND SUBSIDIARIES
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


(7) - INCOME TAXES: (CONTINUED)


Operating Loss Carryforwards--

     The Company has loss carryforwards totaling $183,078 that may be offset
against future taxable income.  If not used, the carryforward will expire as
follows:

                        Year                    Year
                     Originated               Expired

                        1984                    1999        $ 155,361
                        1991                    2006           27,717
                                                            ---------
                                                            $ 183,078
                                                            =========


(8) - PRIOR PERIODS ADJUSTMENT FOR CHANGE IN ACCOUNTING FOR INCOME TAXES:


                                                   1996
            Net Income as Previously
              Reported                          $ 58,110
            Adjustment for Deferred Tax
              Benefit                            (12,018)
                                                --------
            Net Income as Adjusted              $ 46,092
                                                ========

            Earnings Per Share Amounts:
              As Previously Reported                .031
              Effect of Retroactive Change         (.007)
                                                --------
            Earnings Per Share as Adjusted          .024
                                                ========











<PAGE>
                   HOLIDAY-GULF HOMES, INC. AND SUBSIDIARIES
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


(8) - PRIOR PERIODS ADJUSTMENT FOR CHANGE IN ACCOUNTING FOR INCOME          
      TAXES: (CONTINUED)

            Total Shareholders' Equity at
              December 31, 1994               $ 235,346
            Net Income as Previously
              Reported                           54,661
            Payment of 1995 Dividends           (95,193)
            Payment of Unclaimed Dividends         (125)
                                              --------- 
            Shareholders' Equity as
              Previously Stated               $ 194,689

            Adjustment For Recognition of
              Deferred Tax Benefit               61,340
            Adjustment to Net Income 1995       (11,422)
                                              --------- 
            Shareholders' Equity as Restated,          
              December 31, 1995               $ 244,607
                                              =========


(9) - DISCLOSURES ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS:

      The carrying value of cash and cash equivalents approximate fair values.