FORM 10-QSB
                    U. S. SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549


[x]  QUARTERLY  REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES  EXCHANGE ACT
     OF 1934

For the quarterly period ended June 30, 1997
                                       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: 0-10944

                             MTX INTERNATIONAL, INC.
         ---------------------------------------------------------------
        (Exact name of small business issuer as specified in its charter)


             Colorado                                   84-0729290
 ------------------------------             -----------------------------------
(State or other jurisdiction of            (I.R.S. Employer Identification  No.)
 incorporation or organization)

   7901 E. Belleview Ave., Suite 50, Englewood, Colorado           80111
   -----------------------------------------------------          --------
         (Address of principal executive offices)                (Zip Code)

                                 (303) 770-9840
                -------------------------------------------------
               (Registrants 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  Securities  Exchange  Act of 1934 during the past 12
months (or such  shorter  period that the  registrant  was required to file such
reports),  and (2) has been subject to such filing  requirements for at least 90
days.

Yes [X]   No [ ]
                      APPLICABLE ONLY TO CORPORATE ISSUERS:

     State the number of shares  outstanding of each of the issuer's  classes of
common stock, as of the latest practicable date.


                               Shares Outstanding
                               Class of Securities
                              (as of June 30, 1997)
                          -----------------------------
                          Common Stock, $0.01 par value
                                   10,854,398

                 Transitional Small Business Format (Check One)
                                 Yes [ ] No [X]


<PAGE>

                                   FORM 10-QSB

                             MTX INTERNATIONAL, INC.

                                      INDEX



                                                                            Page
                                                                            ----

Management's Discussion and Analysis or Plan of Operation                      3

Legal Proceedings                                                              4

Defaults Upon Senior Securities                                                4

Submission of Matters to a Vote of Security Holders                            4

Other Information                                                              4

Exhibits and Reports on Form 8-K                                               4

Financial Statements
       Condensed Balance Sheet (Unaudited) - December 31, 1996                 5
       Condensed Statement of Operations (Unaudited) Three Months Year
           Ended December 31, 1996 and 1995                                    7
       Condensed Statement of Changes in Cash Flows (Unaudited) for the
         Three Months Ended December 31, 1996 and 1995                         8

Notes to Condensed Financial Statements                                        9

Signatures                                                                    10








                                                                               2



<PAGE>


PART I.   FINANCIAL INFORMATION

Item 1. Financial Statements

The  information  required by Item 310(b) of Regulation  S-B is included  hereto
beginning on page 5.

Item 2. Management Discussion and Analysis of Plan of Operation

Capital and Source of Liquidity:

For the nine months ended June 30, 1997, the Corporation  experienced a net loss
from  operations  of $140,857 as compared to loss of $42,860 for the same period
in 1996.  Depreciation and amortization  expenses remained relatively  unchanged
for this period.  Accounts  receivable  decreased  from $86,775 at September 30,
1996 to  $77,683  at June  30,  1997.  Inventories  increased  from  $65,305  at
September  30, 1996 to $67,022 at June 30, 1997. An employee  receivable,  which
reflects draws against commissions,  decreased from $1,270 at September 30, 1996
to zero at June 30, 1997.  Software  acquisition and development  costs,  net of
amortization,  decreased from $174,749 at September 30, 1996 to $169,870 at June
30, 1997.  Prepaid expenses  decreased from $6,670 at September 30, 1996 to zero
at June 30, 1997.  Other assets  remained  relatively  the same for this period.
Accounts payable and accrued liabilities decreased from $207,474 at December 31,
1996 to $199,434 at June 30, 1997.  The notes payable  totaling  $113,678 are to
shareholders  and are classified as current since all are due within the next 12
months.  A  substantial  portion of the notes  payable are for loans made to the
Company  by its  President  and CEO.  Ending  cash  decreased  from  $26,732  at
September 30, 1996 to $22,157 at June 30, 1997.

Results of Operations:

Total revenues  decreased  $198,611 or 61% and $302,276 or 42% for the three and
nine months  ended June 30,  1997 as compared  with the same period in the prior
year.  Service and  consulting  revenue  decreased  from  $141,860 for the three
months and from  $238,180 for the nine months ended June 30, 1997 to $70,874 for
the three months and  $341,943  for the nine months  ended June 30,  1996.  As a
result of continued declines in sales,  management terminated the use of a third
party  commissioned  sales  organization  as  their  performance  proved  to  be
unsatisfactory.  Management is recruiting senior sales management experienced in
the sales and marketing of accounting software systems.

Cost of sales,  service and  consulting  decreased  to 12% from 17% of sales and
service &  consulting  revenue  for the three  months  ended  June 30,  1997 and
decreased  to 10% from 13% for the nine months  ended June 30,  1997.  Marketing
expenses  increased to 53% of total  revenue  from 28% of total  revenue for the
three  months ended June 30 of each year and to 50% from 40% for the nine months
ended of each year.  Management  has  initiated new  advertising  efforts and an
overhaul of the Company's Internet website to attempt to increase new sales.

General and administrative  expenses increased to 63% from 32% of total revenues
for the three months ended June 30 of each year and to 61% from 40% for the nine
months ended June 30 of each year. This increase is due to the decline in sales.

Earnings  decreased  to a loss of $43,248 for the three month  period ended June
30, 1997 as compared to net income of $44,613 and to a loss of $137,077  for the
nine  months  ended  June 30,  1997 as  compared  to a loss of  $43,696  for the
comparable prior year periods. The decline in earnings continues to be caused by
a decline in sales of software and related services. Management is continuing to
focus efforts on increasing sales while controlling expenses.


                                                                               3


<PAGE>

The Company's new MTX Enterprise  Accounting  system was completed May 27, 1997,
at which time Microsoft  advised the company that their new product was approved
for Microsoft  BackOffice  logo  certification.  The new product uses  Microsoft
Access 97 and Microsoft SQL Server 6.5, and is fully  integrated  with Microsoft
Office 97. Management believes this new product will generate new sales.


PART II. OTHER INFORMATION

Item 1. Legal Proceedings

No legal proceedings are required to be disclosed hereunder.

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

     (a) Exhibits - None.
        (27) Financial Data Schedule

     (b) Reports on Form 8-K

     Registrant  filed a Form 8-K on April 15,  1997  appointing  a new Board of
Directors.





                                                                               4


<PAGE>


<TABLE>
<CAPTION>
                             MTX INTERNATIONAL, INC.
                             CONDENSED BALANCE SHEET
                                   (Unaudited)

                                     ASSETS

                                                                                  June 30,
                                                                                    1997
                                                                                  --------
<S>                                                                            <C>        
Current assets:

         Cash ..............................................................   $    22,157

         Accounts receivable - trade, less allowance
            for doubtful accounts of $1,104 at 6/30/97 .....................        77,683

         Employee receivable ...............................................          --

         Current portion of note receivable ................................           265

         Inventory .........................................................        67,022

         Prepaid expenses ..................................................          --
                                                                                  --------
                  Total current assets .....................................       167,127

Property and equipment, at cost:

         Computer equipment ................................................        64,359

         Furniture and equipment ...........................................       140,829

         Leasehold improvements ............................................           676

         Rental equipment ..................................................         6,056
                                                                                  --------
                                                                                   211,920

         Less accumulated depreciation .....................................       199,598
                                                                                  --------
                  Net property and equipment ...............................        12,322

Other assets:

         Software acquisition and development costs, net
            of amortization of $651,995 at 6/30/97 .........................       169,870

         Refundable deposits ...............................................         4,268
                                                                                  --------
                  Total other assets .......................................       174,138
                                                                                  --------
                                                                               $   353,587
                                                                                  ========


                             See accompanying notes.

                                                                               5
<PAGE>

<CAPTION>
                             MTX INTERNATIONAL, INC.
                             CONDENSED BALANCE SHEET
                                   (Unaudited)

                      LIABILITIES AND STOCKHOLDERS' EQUITY

                                                                                  June 30,
                                                                                    1997
                                                                                  --------

<S>                                                                            <C>        

Current liabilities:

         Notes payable shareholders ........................................   $   113,678

         Accounts payable ..................................................       161,902

         Accrued liabilities ...............................................        37,532

         Deferred revenue ..................................................        76,989
                                                                                 ---------
                  Total current liabilities ................................       390,101

Stockholders' equity:

         Common stock, $.01 par value; 40,000,000 shares
            authorized, 10,854,398 shares issued and
            outstanding ....................................................       117,744

         Stock subscriptions ...............................................          --

         Additional paid-in capital ........................................     2,225,459

         Accumulated deficit ...............................................    (2,357,224)
                                                                                 ---------
                                                                                   (14,021)
         Less 68,160 common shares in treasury, at cost ....................        22,493
                                                                                 ---------
                  Total stockholders' equity ...............................       (36,514)
                                                                                 ---------
                                                                               $   353,587
                                                                                 =========
</TABLE>

                             See accompanying notes.


                                                                               

<PAGE>

<TABLE>
<CAPTION>
                            MTX INTERNATIONAL, INC.
                        CONDENSED STATEMENT OF OPERATIONS
                                   (Unaudited)

                                                                         Three Months Ended                   Nine Months Ended
                                                                              June 30,                             June 30,
                                                                      ------------------------            -------------------------
                                                                        1997             1996               1997              1996
                                                                        ----             ----               ----              ----
<S>                                                                 <C>               <C>               <C>               <C>  
Revenues:

         Sales .............................................        $  50,953         $ 179,298         $ 177,636         $ 376,122

         Service and consulting ............................           70,874           141,860           238,180           341,943

         Other .............................................            1,083               363             1,090             1,117
                                                                    ---------         ---------         ---------         ---------
                                                                      122,910           321,521           416,906           719,182

Costs and expenses:

         Costs of sales, service
           and consulting ..................................           15,280            54,797            43,670           100,307

         Marketing .........................................           66,006            90,827           212,437           293,572

         General and administrative ........................           78,194           105,681           254,865           291,380

         Depreciation and amortization .....................           11,045            13,490            32,088            37,070

         Research and development ..........................              653            11,980            14,703            39,713
                                                                    ---------         ---------         ---------         ---------
                                                                      171,178           276,775           557,763           762,042
                                                                    ---------         ---------         ---------         ---------
Income (loss) from operations ..............................          (48,268)           44,746          (140,857)          (42,860)

Other income (expense):

         Rental income .....................................            8,256              --              10,639              --

         Interest income ...................................               16                92                20               504

         Interest expense ..................................           (3,252)             (225)           (6,879)           (1,340)

         Utilization of operating loss carry
         forward ...........................................             --               8,900              --               8,900
                                                                    ---------         ---------         ---------         ---------
                                                                        5,020             8,767             3,780             8,064

Net income (loss) before income taxes ......................          (43,248)           53,513          (137,077)          (34,796)

Provision for income taxes .................................             --              (8,900)             --              (8,900)
                                                                    ---------         ---------         ---------         ---------
Net income (loss) ..........................................        $ (43,248)        $  44,613         $(137,077)        $ (43,696)
                                                                    =========         =========         =========         =========
         Earnings per share: ...............................        $    --           $    --           $    --           $    --
                                                                    =========         =========         =========         ---------
</TABLE>


                             See accompanying notes.

                                                                               7


<PAGE>

<TABLE>
<CAPTION>
                            MTX INTERNATIONAL, INC.
                             STATEMENT OF CASH FLOWS
                                  (Unaudited)
                    NINE MONTHS ENDED JUNE 30, 1997 AND 1996

                                                                                                       1997                   1996
                                                                                                       ----                   ----
<S>                                                                                                <C>                    <C>   
Cash flows from operating activities:
         Net income (loss) before extraordinary item .................................             $(137,077)             $ (43,696)
         Adjustments to reconcile net income (loss)
           to net cash provided by operating activities:
               Depreciation and amortization .........................................                32,088                 37,071
               (Increase) decrease in accounts receivable ............................                10,362                (41,146)
               (Increase) decrease in inventory ......................................                (1,717)                 2,182
               (Increase) decrease in note receivable ................................                    50                   --
               (Increase) decrease in prepaid expenses ...............................                 6,670                   (955)
               (Increase) decrease in refundable deposits ............................                    50                   --
               Increase (decrease) in accounts payable ...............................                38,971                 62,783
               Increase (decrease) in accrued liabilities ............................               (47,011)                22,913
               Increase (decrease) in deferred revenue ...............................                 4,229                  8,316
                                                                                                   ---------               --------
               Increase (decrease) in guarantee liability ............................                  --                   (2,667)
                                                                                                   ---------               --------
                  Total adjustments ..................................................                43,692                 88,497

         Net cash (used) provided by operating activities ............................               (93,385)                44,801

Cash flows from investing activities:

         Purchases of property and equipment .........................................                  --                     (460)

         Purchase and development of computer software ...............................               (24,868)               (76,177)
                                                                                                   ---------               --------
         Net cash used in investing activities .......................................               (24,868)               (76,637)

Cash flows from financing activities:

         Borrowings from shareholder .................................................               113,678                   --

         Common stock subscribed .....................................................                  --                    1,500

         Repayment of officer loan ...................................................                  --                   (4,399)
                                                                                                   ---------               --------
         Net cash provided by financing activities ...................................               113,678                 (2,899)
                                                                                                   ---------               --------
Net increase (decrease) in cash ......................................................                (4,575)               (34,735)

Cash at beginning of period ..........................................................                26,732                 60,492
                                                                                                   ---------               --------
Cash at end of period ................................................................             $  22,157              $  25,757
                                                                                                   =========               ========
</TABLE>



                             See accompanying notes.

                                                                               8

<PAGE>

                             MTX INTERNATIONAL, INC.
                     NOTES TO CONDENSED FINANCIAL STATEMENTS


1. In the opinion of management,  the accompanying unaudited condensed financial
statements   contain   all   adjustments   necessary   to  present   fairly  MTX
International, Inc.'s financial position as of March 30, 1997 and the results of
operations  and  statement  of cash flows for the three  months and nine  months
ended June 30, 1997 and 1996.

2. Prior period costs and expenses  have been  restated to properly  reflect the
amounts and to be consistent with the audited year end financial statement.  The
restatement does not effect loss from operations or the net loss.

3. Earnings per share have been computed  using the weighted  average  number of
shares outstanding during each period.







                                                                               9
<PAGE>

                                   SIGNATURES



                                        MTX International, Inc.
                                        -----------------------
                                        Registrant


Date  8/29/97                           By:  /s/ A. W. Blair
                                           -------------------------------------
                                            President & Chief
                                            Executive Officer


Date  8/29/97                           By:  /s/ Gary W. Williams
                                           -------------------------------------
                                            Gary W. Williams
                                            Secretary, Controller


Date  8/29/97                           By:  /s/ Kevin J. Cox
                                           -------------------------------------
                                            Kevin J. Cox
                                            Director


                                                                              10