SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

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

                  For the quarterly period ended June 30, 2001

       TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
                              EXCHANGE ACT OF 1937


                        Commission file number: 000-22273

                           SONIC JET PERFORMANCE, INC.
        (Exact Name of Small Business Issuer as Specified in Its Charter)


         COLORADO                                       84-1383888
         --------                                       ----------
 (State of Incorporation)                   (I.R.S. Employer Identification No.)


                               15662 COMMERCE LANE
                       HUNTINGTON BEACH, CALIFORNIA 92649
                      ------------------------------------
                    (Address of Principal Executive Offices)

                                 (714) 895-0944
                              --------------------
                (Issuer's Telephone Number, including Area Code)

                                 NOT APPLICABLE
                             ---------------------
              (Former Name, Former Address and Former fiscal Year,
                          if Changed Since Last Report)

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

                        YES [X]      NO [ ]


As of June 30, 2001, the Issuer had 18,567,936 shares of Common Stock, no par
value, outstanding.

<PAGE>


                           SONIC JET PERFORMANCE, INC.

                                   FORM 10-QSB

                  FOR THE QUARTERLY PERIOD ENDED June 30, 2001

                                Table of Contents

                          PART I. FINANCIAL INFORMATION


    FINANCIAL INFORMATIONCONTAINED HERE IN HAVE NOT BEEN REVIEWED BY AUDITORS


Item 1.      Financial Statements

             Balance Sheet at June 30, 2001 (unaudited)

             Statement of operations for the Six months ended June 30, 2001
              and 2000 (unaudited)

             Statements of Cash Flows for the Six months ending June 30, 2001
              and 2000 (unaudited)

             Notes to Consolidated Financial Statements (unaudited)

Item 2.    Management's Discussion and Analysis or Plan of operations

             General

             Results of operations

             Liquidity and Capital Resources

                           PART 11. OTHER INFORMATION

Item 1.   Legal Proceedings

Item 2.   Changes in Securities

Item 3.   Defaults upon Senior Securities

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

Item 5.   Other Information

Item 6.   Exhibits and reports on Form 8-K



<PAGE>
<TABLE>
<CAPTION>



                  SONIC JET PERFORMANCE, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEET
                            JUNE 30, 2001 (UNAUDITED)
 -----------------------------------------------------------------------------

                                                                June 30, 2001           December 31, 2001
                                                                -------------           -----------------
<S>                                                           <C>                       <C>
ASSETS
CURRENT ASSETS
Cash                                                          $      77,822             $    40,129
Accounts receivable -trade                                          180,707                  45,760
Inventories                                                         316,080                 574,903
Other current assets                                                 12,700                   3,450
Restricted Cash                                                     207,239                 203,120
Due from Related Party                                                    -                 393,291
                                                                ------------            ------------
Total current assets                                                794,548               1,260,653

PROPERTY AND EQUIPMENT, net                                       1,301,029               1,359,910
Licensing rights                                                    267,500                 267,500
Investment in China                                                 248,626                       0
                                                                ------------            ------------
TOTAL ASSETS                                                     $2,611,703             $ 2,888,063
                                                                 ==========             ============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable                                                   $286,855                 192,206
Accrued Payroll  Taxes                                               66,783                  68,486
Accrued interest and other accrued liabilities                       48,105                 687,049
Current portion of capitalized lease obligations                        654                   1,432
Convertible debt - related party                                          0               2,801,301
                                                                ------------            ------------
Total current liabilities                                           402,397               3,750,474

Capitalized lease obligations, net of current portion                12,236                  12,236
Subordinate note payable - related party                                  0                 600,000
                                                                ------------            ------------
Total liabilities                                                   414,633               4,362,710
STOCKHOLDERS' EQUITY
     Preferred stock, no par value
         10,000,000 shares authorized
         Series A Convertible preferred stock
         1,600 shares issued and outstanding                     (1,500,000)
Common stock, no par value                                       11,973,215
100,000,000 shares authorized
18,567,936 shares issued and outstanding                                                  4,328,777
Additional paid-in capital - stock warrant outstanding                    -               1,024,627
Additional paid-in capital                                                -                 143,872
Accumulated deficit                                              (9,776,145)             (9,590,253)
Shares committed to be issued                                             -                 143,872
Accumulated comprehensive income                                          -                  20,330
                                                                 -----------            ------------
Total stockholders' equity                                        2,197,070              (1,474,647)
                                                                 -----------            ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                       $2,611,703             $ 2,888,063
                                                                 ===========            ============

</TABLE>

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

                                      F-1

<PAGE>

<TABLE>
<CAPTION>

SONIC JET PERFORMANCE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30,
--------------------------------------------------------------------------------------------------------------------------------
                                               3 Months Ended June 30,                   6 Months Ended June 30,
                                                2001          2000                         2001                 2000
                                               (unaudited)   (unaudited)                 (unaudited)      (unaudited)
                                               -----------   -----------                 -----------      -----------
<S>                                            <C>              <C>                        <C>          <C>

SALES                                           $ 460,613         $387,065                 $1,044,072     $966,439
COST OF SALES                                     356,449          373,840                    828,636      819,801
                                               -----------      -----------                -----------    --------
GROSS  PROFIT                                     104,164           13,225                    215,436      146,638

SELLING, GENERAL & ADMINISTRATIVE EXPENSES       (242,229)      (1,048,096)                  (583,845)  (1,442,876)
                                               -----------      -----------                -----------  ------------
INCOME (LOSS)  FROM OPERATIONS                   (138,065)      (1,034,871)                  (368,409)  (1,296,238)
                                               -----------      -----------                -----------  ------------
OTHER  (EXPENSE)                                                       817                        ---          ---
OTHER INCOME                                      167,846            4,587                    171,846        9,670
INTEREST INCOME                                     4,127              120                      4,140          255
INTEREST EXPENSE                                   94,464         (602,382)                   (13,801)  (1,351,705)
                                               -----------      -----------                -----------  ------------
TOTAL OTHER INCOME (EXPENSE)                      266,437         (596,858)                   162,185   (1,341,780)
                                               -----------      ----------                 -----------  ------------
NET  INCOME (LOSS)                                128,372       (1,631,729)                  (206,224)  (2,638,018)

BASIC & DIILUTED EARNINGS (LOSS) PER SHARE        0.01               (0.12)                     (0.01)       (0.20)

WEIGHTED AVERAGE COMMON Shares
Used in computation of basic and diluted
   loss per share                              12,894,631       12,842,410                 12,894,631   12,842,410

</TABLE>


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

                                      F-2

* Taken from the weighted  average  common shares  outstanding  as at the end of
06/30/01


<PAGE>

<TABLE>
<CAPTION>
SONIC JET PERFORMANCE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
FOR THE SIX MONTHS ENDED JUNE 30, 2001 (UNAUDITED)
------------------------------------------------------------------------------------------------------------------------------------
<S>          <C>         <C>          <C>         <C>       <C>         <C>          <C>     <C>          <C>           <C>
              Preferred Stock           Common Stock        Additional
               Shares    Amount       Shares      Amount    Paid-In
                                                            Capital      Additional  Shares   Accumulated
                                                            Stock          Paid-In   Committed  compre-
                                                            Warrant        Capital   to be      hensive   Accumulated
                                                            Outstanding              Issued    (loss)       Deficit        Total
                                                                                                 income
             --------   ----------   ----------  ----------   ---------  -----------  --------- --------  ------------   -----------
BALANCE
DEC 31, 2000    1,600   $1,500,000   13,024,767  $4,328,777  $1,024,627  $1,098,000   $143,872  $20,330   $(9,590,253)  $(1,474,647)
Capital changes                                                   1,500       4,250                                           5,750
due to debt
financing (unaudited)
Issuance of
common Stock
(unaudited)
Cumulative
Translation
Adjustment
(unaudited)
Net income (unaudited)                                                                                       (334,594)     (334,594)
             --------   ----------   ----------  ----------   ---------  -----------  --------- --------  ------------   -----------
BALANCE
March 31, 2001  1,600   $1,500,000   13,024,767  $4,328,777  $1,026,127  $1,102,250   $143,872   20,330   $(9,924,847)  $(1,803,491)
Issuance of
 common        (1,600)  (1,500,000)   5,543,169   7,644,438  (1,026,127) (1,102,250)  (143,872)                           3,872,189
Stock (unaudited)
Cumulative Translation                                                                          (20,330)       20,330
Net income (unaudited)                                                                                        128,372       128,372
                   --          ---   18,567,936  11,973,215        ----        ----     ----        ---    (9,776,145)    2,197,070
             --------   ----------   ----------  ----------   ---------  -----------  --------- --------  ------------   -----------
</TABLE>

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

                                      F-3

<PAGE>
<TABLE>
<CAPTION>
SONIC JET PERFORMANCE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30,
--------------------------------------------------------------------------------

<S>                                                              <C>             <C>
                                                                     6 Months Ended  June 30,
                                                                      2001            2000
                                                                 ------------    ------------
                                                                   (unaudited)    (unaudited)

CASH FLOWS FROM OPERATING ACTIVITIES
Net  Income (Loss)                                                 $(206,224)   $(2,638,018)
Adjustments to reconcile net income (loss) to net cash
provided by (used in) operating activities
Depreciation and amortization                                         60,000        128,783
Loss on sale of property and equipment                                                3,071
Interest relating to beneficial conversion and warrants                           1,237,612
Minority interest                                                                     8,910
Common stock issued for services                                                     54,000
(Increase) Decrease in Current Assets
Inventory                                                            258,821        373,690
Due from related parties                                             142,502         75,684
Accounts Receivables                                                (134,948)      (422,134)
Other Receivables                                                     (9,249)         -----
Other current assets                                                  (4,119)        (2,195)
Prepaid Inventory                                                        000         20,000
Increase (Decrease) in Current Liabilities
Accrued Interest payable                                            (300,834)       108,160
Accrued Payroll taxes                                                 (1,703)         9,967
Other accrued liabilities                                           (260,758)         6,333
Accounts Payable                                                      17,297       (197,913)
                                                                  -----------   ------------
Net, cash provided by (used in) operating activities                (439,215)    (1,234,050)
                                                                  ------------  ------------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment                                     1,046        (44,873)
Proceeds from sale of property and equipment                                          1,000
Purchase of other assets
Cost of re-organization                                                             (88,089)
                                                                  ------------  ------------
Net cash used in investing activities                                  1,046       (109,387)
                                                                  ------------  ------------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issue of common shares                               3,877,939
Proceeds from subordinated note payable-related party               (600,000)
Proceeds from convertible debt-related party                      (2,801,301)     1,389,586
Proceeds from capitalized lease obligation                              (776)          (312)
                                                                  ------------  ------------
Net Cash provided by financing activities                            475,862      1,389,274
Effect of exchange rate on cash                                                       7,320
                                                                  ------------  ------------
Net increase  (decrease) in cash                                      37,693         53,157
CASH BEGINNING OF PERIOD                                              40,129         80,557
                                                                  ------------  ------------
CASH END OF PERIOD                                                    77,822        133,714
Interest paid                                                          2,957          5,811
Income taxes paid                                                      ----             800
</TABLE>

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

                                      F-4

<PAGE>


SONIC JET PERFORMANCE, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED JUNE 30, 2001 AND 2000 (UNAUDITED)
--------------------------------------------------------------------------------
NOTE I - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Business

Sonic Jet Performance, Inc. ("SJPI"), a Colorado corporation, and subsidiary
(collectively, the "Company") are engaged in the design and production of boats,
and accessories. The principal executive office is located in Huntington Beach,
California.

Principles of Consolidation

The consolidated financial statements include the accounts of SJPI and its
subsidiary, Nanning Sonic Jet, LLC. a wholly-owned subsidiary of SJPI. All
inter-company balances and transactions are eliminated in consolidation. SJPI
manages the day-to-day operations of the subsidiary and is represented by three
directors of the subsidiary.

Going Concern
The accompanying consolidated financial statements have been prepared on a going
concern basis which contemplates the realization of assets and the satisfaction
of liabilities in the normal course of business. As shown in the financial
statements, during the quarter ended June 30, 2001 the Company incurred profit
of $148,022 and the Company's accumulated deficit is ($9,756,495) as of June 30,
2001. Realization of a major portion of the assets in the accompanying balance
sheet is dependent upon continued operations of the Company, obtaining
additional financing, and the success of its future operations.

Since December 31, 2000, the Company received $50,000 from the lender which has
been converted to 144D stock at the rate of $1.25. The Company has signed an
agreement for a fleet credit program for its dealer network under which the
finance company will purchase eligible receivables up to $1,000,000 from the
Company. Management expects such a receivable-financing program will provide
sufficient cash to continue the Company's present operations.

Interim Unaudited Financial Information

The unaudited financial information furnished herein reflects all adjustments,
consisting only of normal recurring adjustments, which in the opinion of
management, are necessary to fairly state the Company's financial position, the
results of operations, and cash flows for the periods presented. The results of
operations for the six months ended June 30, 2001 are not necessarily indicative
of results for the entire fiscal year ending December 31, 2001.

The information with respect to six months ended June 30, 2001 and 2000 is
unaudited.

Estimates

The preparation of financial statements is in conformity with generally accepted
accounting principles. It requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements, as
well as the reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates.

                                      F-5

<PAGE>

SONIC JET PERFORMANCE, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED JUNE 30, 2001 AND 2000 (UNAUDITED)
--------------------------------------------------------------------------------

Cash  Equivalents

For purposes of reporting  cash flows,  the Company  considers all highly liquid
debt  instruments  purchased  with a maturity of three months or less to be cash
equivalents.  Cash  equivalents  consist  primarily of United States  government
securities.

Inventories

Inventories are stated at the lower of cost (Weighted average method)or market.
Work in process and finished goods include materials.

Property and Equipment

Property and equipment are stated at cost or at the value of the operating
agreement. Depreciation and amortization are computed using the straight line
method over the following estimated useful lives:

     Furniture and fixtures                        7 years
     Machinery and equipment                       7 years
     Tooling and molds                             7 years
     Vehicles                                      7 years
     Leasehold improvements                       15 years

The Company capitalizes costs incurred on tooling and molds once the design of
the product is completed and marketability of the product is established by
independent marketing channels.

Income Taxes

The Company was a limited liability company until June 18, 1998 and was taxed as
a partnership, whereby the members were liable for federal and state income
taxes on their respective shares of the Company's taxable income.

The Company became a "C" corporation effective June 19, 1998. The Company uses
the asset and liability method of accounting for income taxes. The asset and
liability method accounts for deferred income taxes by applying enacted
statutory rates in effect for periods in which the difference between the book
value and the tax bases of assets and liabilities are scheduled to reverse. The
resulting deferred tax asset or liability is adjusted to reflect changes in tax
laws or rates. Because the Company has incurred a loss from operations, no
benefit is realized for the tax effect of the net operating loss carry forward
due to the uncertainty of its realization.

Foreign Currency Transaction

Assets and liabilities in foreign currencies are translated at the exchange rate
prevailing at the balance sheet date. Revenues and expenses are translated at
the exchange rate prevailing at the transaction date, and the resulting gains
and losses are reflected in the statements of operations. Gains and losses
arising from translation of a subsidiary's foreign currency financial statements
are shown as a component of stockholders' equity as accumulated comprehensive
income (loss).

Impairment of Long-Lived Assets

The  Company  reviews  long-lived  assets  to be held and  used  for  impairment
whenever events or changes in circumstances indicate that the carrying amount of
an asset may not be  recoverable.  If the sum of the expected  future cash flows
(un-discounted) and without interest charges is less than the carrying amount of
the asset, the Company would recognize an impairment loss based on the estimated
fair value of the asset.

                                      F-6

<PAGE>

SONIC JET PERFORMANCE, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED JUNE 30, 2001 AND 2000 (UNAUDITED)
--------------------------------------------------------------------------------

Loss per Share

The Company utilizes SFAS No. 128, "Earnings per Share." Basic loss per share is
computed  by   dividing   loss   available   to  common   stockholders   by  the
weighted-average number of common shares outstanding.  Diluted loss per share is
computed  similar  to basic  loss per  share  except  that  the  denominator  is
increased to include the number of additional common shares that would have been
outstanding if the potential common shares had been issued and if the additional
common shares were dilutive.  Because the Company has incurred net losses, basic
and diluted loss per share are the same.

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Recently Issued Accounting Pronouncements

In December 1999, the Securities and Exchange Commission staff released Staff
Accounting Bulletin ("SAB") No. 101, "Revenue Recognition," to provide guidance
on the recognition, presentation, and disclosure of revenue in financial
statements. Changes in accounting to apply the guidance in SAB No. 101 may be
accounted for as a change in accounting principle effective January 1, 2000.
Management has not yet determined the complete impact of SAB No. 101 on the
Company; however, management does expect that application of SAB No. 101 will
have a material effect on the Company's revenue recognition and results of
operations.

In March 2000, the Financial Accounting Standards Board ("FASB") issued FASB
Interpretation No. 44, "Accounting for Certain Transactions Involving Stock
Compensation," (an Interpretation of Accounting Principles Bulletin Opinion No.
25 ("APB 25")) ("FIN 44"). FIN 44 provides guidance on the application of APB
25, particularly as it relates to options. The effective date of FIN 44 is July
1, 2000, and the Company has adopted FIN 44 as of that date.

In June 2000,  the FASB issued SFAS No. 138, "Accounting for Certain Instruments
and Certain Hedging Activities."  This statement is not applicable to the
Company.

NOTE 2 - INVENTORIES

Inventories at June 30, 2001 consisted of the following:
                                                             (unaudited)
Raw materials and supplies                                    $   78,350
Work in process                                                  214,420
Finished goods                                                    23,310
                                                              ------------
TOTAL                                                          $ 316,080

NOTE 3- CASH

The Company maintains its cash balances at a bank located in California.
Deposits at the bank are insured by the Federal Deposit Insurance Corporation up
to $100,000. At times, the Company holds cash with these banks in excess of
amounts insured by federal agencies. As of June 30, 2001, the uninsured portions
of the balances held at the bank aggregated to $107,000(Unaudited).

                                      F-7

<PAGE>


SONIC JET PERFORMANCE, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED JUNE 30, 2001 AND 2000 (UNAUDITED)
--------------------------------------------------------------------------------

NOTE 4 - PROPERTY AND EQUIPMENT
Property and equipment at June 30, 2001consisted of the following:
                                                                  (unaudited)
                                                                  ------------
Building and improvements                                           $ 32,933
Furniture and fixtures                                                13,613
Machinery and equipment                                              249,070
Molds                                                              1,528,359
Vehicles                                                              52,792
                                                                 ------------
Less accumulated depreciation and amortization                      (575,738)
                                                                 ------------
TOTAL                                                            $ 1,301,029

NOTE 5- CONVERSION OF DEBTS:  PREFERRED STOCK AND NOTES TO  STOCKHOLDER

1.       1,600 Preferred Stock issued & outstanding since 1998 in the name of
         JNC Strategic Fund, Ltd. has been converted to 144D Common Stock on
         June 29, 2001 at the rate of 917 shares to 1 preferred stock. Interest
         on Preferred Stock was converted to 144 D Common Stock at the rate of
         $1.25 per Share.
2.       Law suite filed by Michael Attias for the amount of $1,300,000 was
         settled by issuing 600,000 144D Common Stock.
3.       Promissory Notes for the amount of $600,000 payable to Sheikh Mohammed
         AL Rashid has been paid off by issue of 144D Common stock on June 29,
         2001 at the rate of $1.25 per share. Interest on the above debt was
         settled by issue of 144D Common stock at $1.25 per share.
4.       Promissory Notes issued to JNC Opportunity Fund, Ltd. on loans borrowed
         from time to time was converted to 144D Common Stock on June 29, 2001.
         Interest on the above debts has been converted at 144D Common stock on
         June 29, 2001.

NOTE 6 - COMMITMENTS AND CONTINGENCIES

Lease
The Company leases its facility under an operating lease agreement. Future
minimum lease payments are as follows:

                      Year Ending
                      December 31,                 (unaudited)
                     ------------                  ------------
                          2001                        97,500
                          2002                        16,500
                          2003                         7,750
                                                   -----------
                          TOTAL                     $121,750
Employment Agreement

The Company has retained the services Mr. Albert  Mardikian as Design  Director.
He has been promoted to as Interim CEO from February 1, 2001.

             Year Ending
             December 31,
             ------------
                 2001                                  $ 175,000
                 2002                                  $ 200,000

                                      F-8

<PAGE>

SONIC JET PERFORMANCE, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED JUNE 30, 2001 AND 2000 (UNAUDITED)
--------------------------------------------------------------------------------

Royalty Agreement

The Company replaced royalty agreements with its Design Director and
Chairman/Chief Executive Officer of International Operations, by licensing
agreement. The licensing agreement provides for license fees in amounts equal to
4% of the Company's sales, or 5% of the Company's sales if the Company's profit
margin exceeds 32% to be paid there after until November 18, 2003. He has agreed
with the Board to take 2% as licensing fees for the year 2001.

NOTE 7 - RELATED PARTY TRANSACTIONS

Investment in Joint Venture - Dalian

The Company has entered into an agreement to invest in a joint venture in
Dalian, China for the design, manufacture, and selling of Jet Boats products.
The Company is committed to invest $1,000,000 in the form of molds, tooling, and
know-how. The Company will share 45% of the profits or loss from this venture.
The Company has started commercial production.

Included in due from related parties are amounts due from the following related
parties as of June 30, 2001:

                                                              (unaudited)
                                                             ------------
          DALIAN  SONIC JET, LTD.                               $ 393,291


NOTE 8 - NANNING FACILITY

Nanning Sonic Jet, LLC became a wholly owned subsidiary of SJPI in January 30,
2000.

NOTE 9 - STOCK COMPENSATION PLAN
 No shares were issued to any employees under stock compensation plan during
this quarter.


                                      F-9

<PAGE>


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


COMPARISON OF THE THREE AND SIX MONTHS ENDED JUNE 30, 2001 VS. THE THREE AND SIX
MONTHS ENDED JUNE 30, 2000

The following table sets forth the company's consolidated statements of
operations and the percentages that such items bear to net sales:

<TABLE>
<CAPTION>


                              THREE  MONTHS ENDED JUNE 30,                 SIX MONTHS ENDED JUNE 30,
                               2001           %        2000      %              2001            %       2000          %

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

SALE                           460,613     100.0%     387,065     100.0        1,044,072   100.0       966,439      100.0

Cost of Sales                  356,449      77.4      373,840       96.6         828,636    79.6       819,801       84.8

Gross profit (loss)            104,164      22.6       13,225        3.4         215,436    20.4       146,637       15.2

Selling, General              (242,229)    (52.6)  (1,048,096)    (270.8)       (583,845)  (50.6)   (1,442,876)    (149.3)
and Administrative
Gain/(Loss)from               (138,065)    (30.0)  (1,034,871)    (267.4)       (368,409)  (30.2)   (1,296,239)    (134.1)
operations

Other  Expense                -----          0.0          817        ---          -----    -----        -----       ------
Other Income                  167,846       36.4        4,587        1.2         171,846    14.9        9,670         1.0
Interest Income                 4,127        0.9          120        0.0           4,140     0.4          255         0.0
Interest expenses              94,462       20.5     (602,382)    (155.6)        (13,801)   (1.2)  (1,351,705)     (139.9)
                            -----------     -----  -------------   -------     ----------  ------   ------------   -------
Net Income/(Loss)             128,372       27.8   (1,631,729)    (421.8)       (206,224)  (16.1)  (2,638,018)     (273.0)

</TABLE>


<PAGE>


NET SALES

Net sales for the 3 months ended June 30,2001 increased by $73,548 or 19.00% to
$460,613 from $387,065 for 3 the months ended June 30, 2000 and for the 6 Month
ended June 30, 2001 increased by $77,633 or 8.03% to $1,044,072 from $966,439
for the 6 months ended June 30, 2000. Management attributes this increase to the
sales of Vortex boats and Fire Rescue Jets. Sales of parts to Dalian Sonic Jet,
a joint venture partner of Sonic Jet Performance, Inc. ("the Company") amounted
to nil in the 6 months ended June 30, 2001 as compared to $106,000 in the 6
months ended June 30, 2000.

COST OF SALES

Cost of Sales for the 3 months ended June 30, 2001 decreased by $17,391 or 4.65%
to $356,449 from $373,840 for the 3 months ended June 30, 2000 and for the 6
months ended June 30, 2001 increased by $8,835 or 1.07% to $828,636 from
$819,801 for the 6 months ended June 30, 2000. This is mainly attributed to the
cost of parts together with the labor costs during 3 months ended June 30, 2000
and for the six months period ending June 30, 2000.

GROSS PROFIT

Gross profit for the 3 months ended June 30, 2001 increased by $90,939 or
687.62% to $104,164 from $13,225 for the 3 months ended June 30, 2000 and for
the 6 months ended June 30, 2001 increased by $68,799 or 46.91% to $215,436 from
$146,637 for the 6 months ended June 30, 2000. There was no discount on sales
for the 3 months period ending June 30, 2001as against discounts charged during
the 3 months period ending June 30, 2000.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

Selling, general and administrative expenses for the 3 months ended June 30,
2001 decreased by $805,867 or 76.89% to $242,229 from $1,048,096 for the 3
months ended June 30, 2000 and for the 6 months ended June 30, 2001 decreased by
$859,031 or 59.54% to $583,845 from $1,442,876 for the 6 months ended June 30,
2000.

Insurance expenses for the 3 months ended June 30, 2001 decreased by $1,376 or
18.61% to $6,014 from $7,390 for the 3 months period ended June 30, 2000 and for
the 6 months ended June 30, 2001 expenses increased by $1,260 or 4.41% to
$29,828 from $28,568 for the 6 months ended June 30, 2000. The increase is
mainly due to the medical and other incentives given to employees starting
second quarter ending June 30, 2000.

Royalty expenses for the 3 months ended June 30, 2001 increased by $6,000 or
100% to $12,000 from $6,000 for the 3 months period ending June 30, 2000 and for
the 6 months ended June 30, 2001 increased by $7,114 or 26.32% to $34,138 from
$27,024 for the 6 months period ending June 30, 1999. Interest is calculated at
4% for the first quarter and 2% for the second quarter as against fixed amount
for the period ending March 31, 2000.

Travel expenses for the 3 months ended June 30, 2001 decreased by $16,321 or
91.58% to $1,500 from $17,821 for the 3 months ended June 30, 2000 and for the 6
months ended June 30, 2001 decreased by $29,442 or 95.15% to $1,500 from $30,942
for the 6 months ended June 30, 1999. Reduction in traveling expense is mainly
due to absence of traveling by office personnel in the first 2 quarters of 2001.

Salary expenses for the 3 months ended June 30, 2001 decreased by $55,760 or
40.86% to $80,687 from $136,447 for the 3 months period ended June 30, 2000 and
for the 6 months ended June 30, 2001 expenses decreased by $140,656 or 42.68% to
$188,897 from $329,553 for the 6 months ended June 30, 2000. This reduction is
mainly due to not filling of CEO position and abandoning the new position of
Vice President operation, created during previous year and reduction of other
staff positions.

<PAGE>


Rent expenses for the 3 months ended June 30, 2001 decreased by $1,338 or 6.20%
to $20,250 from $21,588 for the 3 months period ended June 30, 2000 and for the
6 months ended June 30, 2001 expenses decreased by $4,998 or 10.81% to $41,250
from $46,248 for the 6 months ended June 30, 2000. This reduction is mainly due
to reduction in the monthly rent.

Advertisement & trade show expenses for the 3 months ended June 30, 2001
decreased by $26,316 or 78.73% to $7,110 from $33,426 for the 3 months period
ended June 30, 2000 and for the 6 months ended June 30, 2001 expenses decreased
by $42,039 or 63.14% to $24,542 from $66,581 for the 6 months ended June 30,
2000. This mainly due to reduction in expenses at trade shows and also
advertisements only in selected magazines.

Legal and Professional expenses for the 3 months ended June 30, 2001 increased
by $7,813 or 312.52% to $10,313 from $2,500 for the 3 months period ended June
30, 2000 and for the 6 months ended June 30, 2001 expenses decreased by $1,705
or 6.13% to $26,126 from $27,831 for the 6 months ended June 30, 2000. The
increase in legal expenses for the three months ended June 30, 2001 is due to
legal cases relating to Mr. Alan Weaver and Harry Yamada, wrongful death case
and case relating to Michael Attias.

Commission on sales expenses for the 3 months ended June 30, 2001 decreased by
$9,826 or 39.08% to $15,314 from $25,140 for the 3 months period ended June 30,
2000 and for the 6 months ended June 30, 2001 expenses increased by $10,374 or
23.93% to $53,716 from $43,342 for the 6 months ended June 30, 2000. The
decrease in commission for the 3 months period ending June 30, 2001 is due to
agreement to pay fixed commission instead of percentage on the sale price to
sales persons.

Consultancy expenses for the 3 months ended June 30, 2001 decreased by $19,000
or 95.00% to $1,000 from $20,000 for the 3 months period ended June 30, 2000 and
for the 6 months ended June 30, 2001 expenses decreased by $23,000 or 92.00% to
$2,000 from $25,000 for the 6 months ended June 30, 2000.

Interest on Debts and Promissory notes for the 3 months period ending March 31,
2001 has been reversed in the 3 months period ending June 30, 2001. This as per
the agreements.

Receivable from Mr. Majed Al Rashid and Sonic Marketing International, LLC were
written off during the 6 months ended June 30, 2000. China Jet ski inventory
which came back from China amounting to $385,082 were written off during 2
quarter ending June 30, 2000. There were no such write off during the 3 months
period ending June 30, 2001.

Florida operations were closed down during the 2 quarter ending June 30, 2000.
Loss incurred in the closing down operation amounted to $30,073 was written off
during the 2 quarter ending June 30, 2000.

NET INCOME/(LOSS)

Net Profit (Loss) for 3 the month ended June 30, 2001 increased by $1,760,101 or
107.86% to $128,372 from $(1,631,729) and for 6 months ended June 30, 2001
increased by $2,431,794 or 92.18% to $(206,224) from (2,638,018). This decrease
in loss is mainly attributable to decrease in selling, general and
administrative expenses.


LIQUIDITY AND CAPITAL RESOURCES

The Company's principal sources of capital have been cash flow from its
operations and loans on an as-needed basis.

<PAGE>


Based on its current operating plan, the Company anticipates that additional
financing will be required to finance its operations and capital expenditures.
The Company's currently anticipated levels of revenues and cash flow are subject
to many uncertainties and cannot be assured. Further, unforeseen events may
occur causing the Company to raise additional funds. The amount of funds
required by the Company will depend upon many factors, including without
limitation, the extent and timing of sales of the Company's products, future
product costs, the timing and costs associated with the establishment and/or
expansion, as appropriate, of the Company's manufacturing, development,
engineering and customer support capabilities, the timing and cost of the
Company's product development and enhancement activities and the Company's
operating results. Until the Company generates cash flow from operations which
will be sufficient to satisfy its cash requirements, the Company will need to
seek alternative means for financing its operations and capital expenditures
and/or postpone or eliminate certain investments or expenditures. Potential
alternative means for financing may include leasing capital equipment, obtaining
a line of credit, or obtaining additional debt or equity financing. There can be
no assurance that, if and when needed, additional financing will be available,
or available on acceptable terms. The inability to obtain additional financing
or generate sufficient cash from operations could require the Company to reduce
or eliminate expenditures for capital equipment, research and development,
production or marketing of its products, or otherwise curtail or discontinue its
operations, which could have a material adverse effect on the Company's
business, financial condition and results of operations. Furthermore, if the
Company raises funds through the sale of additional equity securities, the
Common Stock currently outstanding may be further diluted.

<PAGE>

                           PART II. OTHER INFORMATION

Item 1. Legal Proceedings.

        1.     The Company is a defendant  in a case  brought in Orange  County,
               California for alleged  breach of Company's  contract by Mr. Alan
               Weaver and Mr. Harry Yamada. The Company is vigorously  defending
               the case.

        2.     The Company is a Co-defendant  in a wrongful death case in Orange
               County,  California  resulting  in an  accident  involving a boat
               manufactured  by the  Company.  The  outcome  of the  verdict  is
               uncertain and that the amount of loss cannot be estimated. In the
               event of a verdict  or  attachment  in  excess of any  applicable
               insurance,   the  Company  could  be  materially   and  adversely
               impacted. The Company is vigorously defending the case.

Item 2. Changes in Securities.

The following were issued 144D stock on 6-29-2001:

                                              Amount         Common Stock
         1. JNC Opportunity Fund Ltd.       $3,069,699           2,455,759
         2. JNC Strategic Fund Ltd.          1,930,311           1,731,449
         3. Sheikh Mohammed AL Rashid          808,871             697,097
         4. MGS Grand Sport Inc.                20,375              16,300
         5. Albert Mardikian                    53,205              42,564
         6. Michael Attias                     600,000   Settlement of Law suit

Item 3. Defaults Upon Senior Securities.

            None

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

            None

Item5.Other Information.

            None.

Item 6.Exhibits and Reports on Form 8-K.

        (a) Exhibits:               None

        (b) Reports on Form 8-K.    None.

<PAGE>


                                   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, thereunto duly authorized.

Date: August 21, 2001                         SONIC JET PERFORMANCE, INC.


                                              By: /s/ Madhava Rao Mankal
                                                  ---------------------------
                                                   Name: Madhava Rao Mankal
                                                   Title: Chief Finance Officer