U.S. Securities and Exchange Commission
                             Washington, D.C. 20549

                                  FORM 10-KSB/A
                                AMENDMENT NO. 1


[X]     ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934 for the year ended December 31, 2002

[ ]     TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 for the transition period from _______ to _______

                        COMMISSION FILE NUMBER: 001-14973
                        ---------------------------------

                              NATIONAL BEAUTY CORP.
                              ---------------------
        (Exact name of small business issuer as specified in its charter)

                            BEAUTYMERCHANT.COM, INC.
                            ------------------------
                          (Former name of registrant)

          Nevada                                              13-3422912
          ------                                              ----------
(State or other jurisdiction of                             (IRS Employer
incorporation or organization)                            identification No.)


            4810 West Commercial Blvd, Ft. Lauderdale, Florida 33319
            --------------------------------------------------------
                    (Address of principal executive offices)

                                 (954) 717-8680
                                 --------------
                          (Issuer's telephone number)

Securities registered under Section 12(b) of the Exchange Act:

None.

Securities registered under Section 12(g) of the Exchange Act:

Common Stock, $.001 par value
Convertible Series A Preferred Stock, $.001 par value
2% Convertible Series B Preferred Stock, $.001 par value

Check whether the issuer (1) 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 [ ]

Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure will be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or an
amendment to this Form 10-KSB. [x]

State issuer's revenues for its most recent fiscal year: $542,210.

As of March 31, 2003 there were 35,501,062 common shares outstanding and the
aggregate market value of the common shares (based upon the average of the bid
price of $.05 and the asked price of $.06 reported by brokers) held by
non-affiliates was approximately $1,775,053.

Note that 30,000,000 of these aforementioned common shares above are being held
in an escrow collateral account awaiting certain financings.

Transitional Small Business Disclosure Format (check one): Yes[ ] No[X]

Number of shares of common stock outstanding as of March 31, 2003:    35,501,062
Number of shares of preferred stock outstanding as of March 31, 2003:    750,000



                                     PART I
                                     ------


ITEM  1.     DESCRIPTION OF BUSINESS

CORPORATE ORGANIZATION

As used herein the term "Company" refers to National Beauty Corp., (a Nevada
Corporation), formerly known as BeautyMerchant.com, Inc. since 1999 and its
subsidiaries and predecessors, unless the context indicates otherwise.
Originally incorporated in 1987 as Tri-Capital Corporation, the name was changed
in 1988 to Advanced Appearance of America, which operated beauty salons until
1995. At that time, the Company discontinued its operations and went inactive
until early 1998. In March of 1998, the Company changed its name to ATR
Industries, Inc. On June 1, 1998, the Company acquired ATR Industries, Inc. of
Florida (AKA Cleaning Express USA and Cleaning Express of South Palm Beach,
Inc.), a private Florida Corporation, for 3,000,000 restricted shares of Common
Stock. On September 12, 2002, one of the Company's subsidiaries legally changed
its name to Hairmax of Florida, Inc. from Beautyworks USA of Florida, Inc.

Since 1998, the Company has concentrated its operations primarily on the home
cleaning services industry.


CLEANING EXPRESS USA.  Cleaning Express USA is a wholly owned Florida
subsidiary corporation. The Company's home services operations primarily involve
home cleaning services. Through its emphasis on budget pricing, the Company has
developed a market in the home cleaning industry. The Company currently operates
a central office and dispatches 25-3- workers in teams of two workers on a daily
basis. The present geographic area in which the Company operates includes
Broward and South Palm Beach County areas of South Florida. Marketing for the
home cleaning services is accomplished through print ads, television and radio
commercials. Additionally, the Company utilizes a referral program that rewards
customers with future discounts for referring a client. The home cleaning
industry is highly competitive with respect to price, service, quality and
location. There are numerous, well-established, larger competitors in the home
cleaning industry possessing substantially greater financial, marketing,
personnel and other resources than the Company. There can be no assurance that
the Company will be able to respond to various competitive factors affecting the
business. The Company plans to gain a competitive advantage over its competitors
in the home cleaning industry by offering quality service at a low price. The
Company has been successful in achieving this goal since 1996 and plans to
further expand in South Florida by continuing its current marketing strategy.
The primary market for Cleaning Express USA Inc., is individual households. No
single customer makes up more than ten percent of the total revenues of Cleaning
Express USA, Inc. The Company does not expect that this will change in the
future. The Company has three full time employees and contracts with 30-40
workers that are each independently contracted with the Company to service and
provide home cleaning services to existing and new customers. At this time there
are no plans for expansion.

The ability to become profitable depends on the ability to generate higher
revenues and maintain low expense levels. The Company's limited operating
history makes it difficult to forecast its revenues.

HAIRMAX OF FLORIDA, INC. AND HAIRMAX OF NEVADA, INC.  Hairmax of Florida Inc., a
Florida corporation, and Hairmax of Nevada, Inc., a Nevada corporation have a
limited operating history. Having just started its services operation in the
year 2001, the Company has a short operating history upon which to evaluate its
business and prospects. As a new company, Hairmax faces intense competitors, and
must manage growth effectively. The Company may not succeed in addressing all
challenges and risks, including unpredictability of future revenues. To be
successful, Hairmax plans to implement the following:

1.   Retain existing customers.
2.   Attract new customers.
3.   Meet customer demands.
4.   Fulfill all customer needs.
5.   Maintain sufficient in-store traffic.
6.   Increase our media exposure.
7.   Monitor the competition. Competition in the hair services industry will
     intensify. This increased competition may reduce our profit margins or
     market share.
8.   Ability to hire and retain qualified service personnel (hairstylists).

The principal suppliers to Hairmax Corporation are wholesale distributors, who
do not sell retail.

Hairmax is expecting to add 20 new employees for the first 12 months of retail
service operations. In addition to five managers, since the Company's inception,
it has incurred losses from operations. The Company anticipates losses to
increase relating to the following factors:

*    The development of the Hairmax brand, marketing and promotion.
*    Expanded offering of service.
*    Continued store development costs.
*    Additional personnel to manage customer service and in-house marketing.
*    Increases in general and administrative costs to support the Company's
     growing operations.

SITE SELECTION LOCATIONS:  There are more than 40,000 strip shopping centers in
the United States that provide the Company with vast growth opportunity for new
strip center salons. In evaluating specific locations for its company-owned
stores, the Company seeks conveniently located, highly visible strip shopping
centers, which allow customers adequate parking and quick and easy store access.
The Company believes neighborhood shopping centers anchored by the number one or
two grocery chains in the specific market, or a major mass merchant, provide
access to a stable customer flow The Company has retained the services of Neal
Realty and Development of Fort Lauderdale, Florida to search for shopping center
locations, within South Florida and the company has retained Luccesi and
Associates of Las Vegas, Nevada, to represent them for Hairmax site selection,
and lease negotiation, in the metro Las Vegas area. On a National level Hairmax
is represented by Armada Realty and Investments of Farminham, Michigan for
representation with National Retailers for store in store development, and is
presently in discussion with a large regional retailer, for development of
Hairmax.

The company recently opened a second Hairmax location in Coral Springs, Florida.
Plans are formulated for additional Hairmax stores in South Florida, as soon as
appropriate locations are selected. Las Vegas, Nevada has been selected for a
second development market for Hairmax

The hair services industry is highly competitive with respect to price, service,
and location. As a result, the potential for failure in this industry is
significant. There are numerous, well-established, larger competitors in the
beauty services industry with considerable expertise, possessing substantially
greater financial, marketing, personnel and other resources than the Company.
There can be no assurance that the Company will be able to respond to various
competitive factors affecting the business.

INDUSTRY OVERVIEW : Management estimates that annual revenues of the hair care
industry are $45 billion in the United States. The industry is highly fragmented
with the vast majority of hair care salons independently owned. However, the
influence of chains, both franchise and company-owned, has increased
substantially, although still accounting for a small percentage of total
locations. Management believes that chains will continue to increase their
presence. Management also believes that the demand for salon services and
products will increase in the next decade as the population ages and desires
additional hair care services, such as coloring

In August 2002, the company discontinued all Internet operations, to focus on
the family hair salon concept. The corporate name was changed to HAIRMAX, and a
trademark application has been filed with the US Patent and Trademark office,
registration #76461424. In addition the Florida corporation name was changed to
Hairmax of Florida Inc., which now operates all salon operations in Florida. In
September 2002, the company formed a Nevada subsidiary corporation to operate
the new Hairmax operations in Nevada. This company was formed as Hairmax of
Nevada Inc., and has since entered into a lease for the flagship store, expected
to open in the Spring 2003. In the opinion of management, the new Hairmax stores
will represent significant potential of increased revenues, as further stores
are developed and opened. Initial development is expected to begin 1st quarter
2003, with projected completion later in the year. Risks and uncertainties
include, but are not limited to, consumer spending habits, availability of funds
for project completion, and general acceptance of discounts family salons.

In addition the company began development of a private label line of hair care
products, expected to retail in new and existing Hairmax stores. The company
expects the first products to be delivered during first quarter 2003.

Business  Strategy

The Company's objective is to become a leading provider of hair services, namely
haircutting and hair coloring, the objective is to brand the name Hairmax as a
leading provider of these services. Initial development is targeted to the Las
Vegas, Nevada area, and the South Florida market. Recent statistics identify
both these markets as population growth areas.

The company will also seek to develop expansion of Hairmax low cost hair
services by developing a "store in a store salon", that will be built within in
a high traffic retailer, that specializes in discount retailing. The company is
presently seeking opportunities with this concept, the company plans on an
aggressive marketing program, as the geographic operational areas expand. The
hair services industry is vast and growing. Many salon services such as haircuts
and hair color are considered "recession proof" in the opinion of management.

The Company believes that the sale of beauty services, accessories and hair care
products will offer benefits to customers by providing convenient, competitive
pricing. In addition, customers entering Hairmax may purchase gift certificates,
browse and purchase Hairmax hair care products and participate in special
promotions. The Company expects to promote brand loyalty and repeat purchases by
providing a positive experience that encourages customers to return frequently.

Products  and  Geographic  Expansion

The Company began retail brick and mortar operations in second quarter 2002, and
has shown significant increases in sales by concentrating on service operations.
Management will attempt to expand to expand sales on a continual basis. The
Company has made significant gains in curtailing losses by cost-cutting and
decreasing expenses in the year 2002

Customer  Service

The Company believes its ability to establish long-term relationships with its
customers will encourage repeat sales. The Company provides customer service
with on-premise personnel and qualified management available at all locations.
In addition the company markets its services 7 days a week, to provide maximum
revenue potential

Additional  Risk  Factor

Hairmax of Florida Inc., a Florida corporation, and Hairmax of Nevada, Inc., a
Nevada corporation have a limited operating history. Having just started its
services operation in the year 2001, the Company has a short operating history
upon which to evaluate its business and prospects. As a new company, Hairmax
faces intense competitors, and must manage growth effectively. The Company may
not succeed in addressing all challenges and risks, including unpredictability
of future revenues. To be successful, Hairmax plans to implement the following:

1.   Retain existing customers.
2.   Attract new customers.
3.   Meet customer demands.
4.   Fulfill all customer needs.
5.   Maintain sufficient in-store traffic.
6.   Increase our media exposure.
7.   Monitor the competition. Competition in the hair services industry will
     intensify. This increased competition may reduce our profit margins or
     market share.
8.   Ability to hire and retain qualified service personnel (hairstylists).

The principal suppliers to Hairmax Corporation are wholesale distributors, who
do not sell retail.

Hairmax is expecting to add 20 new employees for the first 12 months of retail
service operations. In addition to five managers, since the Company's inception,
it has incurred losses from operations. The Company anticipates losses to
increase relating to the following factors:

*    The development of the Hairmax brand, marketing and promotion.
*    Expanded offering of service.
*    Continued store development costs.
*    Additional personnel to manage customer service and in-house marketing.
*    Increases in general and administrative costs to support the Company's
     growing operations.

Stock  Based  Compensation

A few key officers and management have elected to be compensated with stock by
S-8 registration. This has provided substantial cash savings.

Additional  Financing

The Company may need to raise additional funds to meet operating requirements in
the future. If the Company raises additional funds through issuance of equity
related or debt securities, such securities may have rights to the Company's
common stock, such as warrants or options. Shareholders may experience
additional dilution from exercise of these equity instruments. The Company
cannot be certain that additional financing will be available when required or
at all. (See 'Liquidity and Capital Resources' for further discussion.

Controls  and  Procedures

(a)  On December 31, 2002, our Chief Executive Officer and Chief Financial
     Officer made an evaluation of our disclosure controls and procedures. In
     our opinion, the disclosure controls and procedures are adequate because
     the systems of controls and procedures are designed to assure, among other
     items, that 1) recorded transactions are valid; 2) valid transactions are
     recorded; and 3) transactions are recorded in the proper period in a timely
     manner to produce financial statements which present fairly the financial
     condition, results of operations and cash flows for the respective periods
     being presented. Moreover, the evaluation did not reveal any significant
     deficiencies or material weaknesses in our disclosure controls and
     procedures.

(b)  There have been no significant changes in our internal controls or in other
     factors that could significantly affect these controls since the last
     evaluation.


ITEM  2.     PROPERTIES

The Company leases its executive offices with 1,650 square feet for
administration at 4810 West Commercial Boulevard, Lauderhill, Florida 33319 for
$1,306 per month. The Company leases its beauty salon facility of 1,100 square
feet at the Del Mar Shopping Village, located at Powerline Road at Palmetto Park
Road, Boca Raton, Florida, for $3,173 per month. The Company leases its beauty
salon facility of 900 square feet at the Coral Palm Plaza, located on University
Drive, Coral Springs, Florida, for $2,226 per month. Also, the Company leases
its newest beauty salon facility of 1,600 square feet at the Sahara Pavilion
South, located at Decatur Boulevard and Sahara Avenue, Las Vegas, Nevada, for
$2,272 per month. Management considers these facilities to be adequate for its
requirements for the immediate future. These noncancelable leases expire at
varying dates through December 31, 2007.

ITEM  3.     LEGAL PROCEEDINGS

The Company is not a party to any legal proceedings, nor, to the best of its
knowledge, are any such proceedings threatened or contemplated.

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

The Company filed a Certificate of Amendment to Articles of Incorporation with
the State of Nevada to increase the number of authorized common shares to
600,000,000, with a continued par value of $.001. A majority of the Company's
shareholders voted to approved this transaction in the fourth quarter.

Subject to a majority vote of the Company's shareholders in the fourth quarter,
the Company reduced the number of shares of the Series "A" convertible preferred
from 50,000,000 to 40,000,000 and authorized the creation of a new 1,000
authorized shares of Series "B" 2% convertible preferred shares.

In the fourth quarter, the majority of the shareholders voted to approve the
Company's acquisition of the assets of an unrelated Colorado corporation through
an agreement and plan for merger.

In the fourth quarter, the majority of the shareholders voted to approve the
Company's operating leases in Coral Springs, Florida and Las Vegas, Nevada.

                                    PART II
                                    -------

ITEM  5.     MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED SECURITY
             HOLDER MATTERS

(a)  The principal market in which the Company's common stock is traded is the
     Over-the-Counter Bulletin Board. The table below presents the high and low
     bid price for the Company's common stock each quarter during the past two
     years and reflects inter-dealer prices, without retail markup, markdown, or
     commission, and may not represent actual transactions. The Company obtained
     the following information from Lexis.com, an on-line source that provides
     historical pricing information.

                        Bid
                        ---
Quarter Ended        Low       High
-------------        ---       ----

03/31/01           $ .08      $ .44
06/30/01             .05        .16
09/30/01             .04       8.00
12/31/01             .36       1.36
03/31/02             .26        .60
06/30/02             .13        .27
09/30/02             .09        .16
12/31/02             .03        .14

(b)  Holders. The approximate number of holders of record of the Registrant's
     Common Stock as of March 31, 2003 was 50.

(c)  The Registrant has not paid dividends from inception to date and does not
     currently intend to do so.



ITEM  6.     MANAGEMENT'S DISCUSSION AND ANALYSIS

Introduction

National Beauty Corp. (a Nevada corporation) legally changed its corporate name
in 2001 and was formerly known as ATR Industries, Inc. On September 12, 2002,
one of the Company's subsidiaries legally changed its name to Hairmax of
Florida, Inc. from Beautyworks USA of Florida, Inc.

The financial statements below include its wholly owned subsidiaries, Cleaning
Express USA, Hairmax of Florida, Inc. (FKA Beauty Works USA, Inc.) and Beauty
Merchant, Inc. Beauty Merchant operations were ceased in 2001. The company is a
full service cleaning company offering daily residential cleaning services,
carpet cleaning and other related services in the South Florida area under the
name of Cleaning Express USA. The Company also offers beauty salon services and
products though its two retail beauty salons in the South Florida area under its
Hairmax of Florida, Inc. subsidiary.

Selected financial data
                                              Year Ended December 31
                                           ----------------------------
                                              2002              2001
                                           ----------        ----------
Net Sales                                  $  542,210        $  431,810

Net Loss                                     (887,790)         (257,044)
Net Loss per Common Share                        (.06)             (.57)
Weighted Average
Common Shares Outstanding                  14,177,091           448,016

                                                As of  December 31,
                                           ----------------------------
                                              2002              2001
                                           ----------        ----------
Total Assets                               $  145,025        $  136,743
Working Capital                                98,405            89,140
Shareholders' Equity                          144,093           120,536

No dividends have been declared or paid for any of the periods presented.

Results of Operations
---------------------
Year Ended December 31, 2002 Compared to Year Ended December 31, 2001

Sales

Sales for the year ended December 31, 2002 increased to $542,210 from $431,810
for the year ended December 31, 2001, an increase of 26%. The increase in
revenues was primarily attributable to an increase in the revenues from Hairmax
of Florida, Inc., the Boca Raton beauty salon subsidiary, somewhat offset by
revenues earned by the Cleaning Express USA subsidiary.

Net sales from the home cleaning segment have accounted for approximately 59% of
total net sales in 2002 and 65% of the net sales in 2001. The decrease is due to
the increase in hair salon sales and a weaker economy for home cleaning
services. The Company plans to accelerate growth of beauty salon sales in 2003
by increasing expenditures on marketing and growing public awareness of
services.

Income  /  Losses

Net losses for the year ended December 31, 2002 increased to $887,790 from
$257,044 for the year ended December 31, 2001, an increase of 245%. The
substantial increase in loss was attributable primarily to an increase in
non-cash expenses relating to common stock and warrants issued for payroll
expenses and consulting services, which were $383,590 and $327,758 for 2002,
respectively, compared to $235,044 in payroll expenses for 2001.

The profitability measure used by the chief decision makers in allocating
resources and assessing segment performance is net cash flows. Net cash flows
are monitored closely for each segment on a timely basis and adjustments, if
any, are made in order to strive for optimal profits. The CEO is the Chief
Operating Decision Maker. The Chief Operating Decision Maker uses net cash flow
as his primary profitability measure in assessing segment performance and
allocating resources.

The Company expects to continue to incur losses at least through fiscal 2003 and
may not be able to achieve or maintain profitability or sustain its revenue
growth in the future.

Expenses

Selling, general and administrative expenses for the year ended December 31,
2002, increased to $1,179,790 from $336,240 for the year ended December 31,
2001, an increase of 250%. The increase in selling, general and administrative
expenses was the result of significant increases in payroll expenses and
consulting fees that were $383,590 and $327,758, respectively, compared to
$235,044 in payroll expenses for 2001. Consulting fees increased due to common
stock share issuances during the year that were paid to consultants to assist us
in our growth plans.

Depreciation and amortization expenses for the years ended December 31, 2002 and
December 31, 2001 were $10,275 and $3,017, respectively. The increase was due to
an increase in the depreciable bases of fixed assts and acquisitions of $23,341
in fixed assets during 2002 compared to only $4,395 in 2001. The purchases
consisted of salon equipment and fixtures for the new store in Coral Springs,
Florida.

The company reduced rent expense in 2001 by closing one of the two cleaning
offices in 2001 and consolidating operations in the other Fort Lauderdale
office. This reduces overhead expenses by a projected 10%. In addition, the
company has taken steps to change daily operations of Cleaning Express USA,
projecting a savings of 5% over 2003. Specifically, the Company is anticipating
a lower labor cost associated with its cleaning services and nominal web site
maintenance leading into 2003.

The Company expects increases in overall expenses through 2003 as the Company
moves toward increasing development and marketing of its Hairmax subsidiaries
and related acquisitions of beauty salons.

Cost  of  Sales

The cost of sales for the year ended December 31, 2002 was $256,210 compared to
$275,974 for the year ended December 31, 2001. The decrease in the cost of sales
was primarily attributable to more of an increase in beauty salon sales than the
increase in cleaning sales during 2002, of which beauty salon sales have much
less cost of sales associated with this type of revenue. Cost of sales as a
percentage of sales for December 31, 2002 and 2001 was 47% and 63%,
respectively. This reflects the aforementioned change in sales mixture to more
of an increase in beauty sales than an increase in cleaning sales. Cost of sales
for the home cleaning services segment represents the majority of our total cost
of sales. Approximately $9,104 and $93,244 of our cost of sales are attributable
to our hair salon segment in 2002 and 2001, respectively. The cost of sales for
our home cleaning services segment represents payments to our subcontractors who
clean our customer's homes. The decrease in hair salon cost of sales is
attributable to our change from Internet sales and overstocking of inventory in
prior years.

The largest factor in the variation from year to year in the cost of sales as a
percentage of net sales was the cost of labor.

Non-Operating  Expense  Items

The unrealized loss on securities in 2002 and 2001 is a result of a write down
in the fair value of the securities during the respective periods. As to trading
losses, marketable securities included the company's investment in equity
securities recorded at fair market value. The marketable securities were
classified as trading securities with holding gains and losses recognized in
current period operations. Since the stock is restricted, there are no controls
to limit the losses in those securities. Ed Roth, CEO, keeps the certificates in
safe keeping under lock and key as an internal control over safeguarding of the
corporate asset. Management's intent is to add value to shareholders by trying
to sell the securities at the most desirable amount without affecting the stock
price in an illiquid stock position. These stocks do not trade much and are
highly illiquid. As of December 31, 2002, the securities valuation was
completely written off to zero to reflect the value of the investments. Recorded
interest expense is attributable to interest paid on the outstanding shareholder
loan balances during the 2002 and 2001 periods.

Impact  of  Inflation

The Company believes that inflation has had a negligible effect on operations
over the past two years. The Company believes that it can offset inflationary
increases in the cost of labor by increasing sales and improving operating
efficiencies.

Trends,  Events,  and  Uncertainties

Demand for the Company's home cleaning services and beauty salon services will
be dependent on, among other things, market acceptance of the Company's concept
and general economic conditions, which are cyclical in nature. Inasmuch as a
major portion of the Company's activities is the receipt of revenues from the
sales of its products, the Company's business operations may be adversely
affected by the Company's competitors and prolonged recessionary periods.

Liquidity  and  Capital  Resources

Critical Accounting Policies (FR-60)

Revenue recognition is a critical accounting policy of ours since it represents
the majority of our entire financial statements taken as a whole. It is also
important in light of the Staff Accounting Bulletins published by the Securities
and Exchange Commission the past few years.

Years ended December 31, 2002 and December 31, 2001

Cash flows used in operations were a negative $86,510 for the year ended
December 31, 2002, and a negative $23,482 for the year ended December 31, 2001.
Negative cash flows from operating activities for the years ended December 31,
2002 and 2001 are primarily attributable to losses from operations, partially
offset by the common stock issued for services in both years an unrealized loss
on trading securities in 2001 and warrants issued in 2002.

Cash flows from investing activities were a negative $23,341 for the year ended
December 31, 2002 and a negative $4,395 for the same period in 2001. The
negative cash flows were solely attributable to new equipment purchases during
2002 and 2001.

Cash flows provided by financing activities were $197,687 for the year ended
December 31, 2002 and used in operations of $17,313 for the year ended December
31, 2001. The negative cash flows in 2001 pertained to repayments on a note
payable and capitalized lease obligation. The positive cash flows in 2002 were
primarily due to the equity placement of common stock sold during 2002 less the
effects of repayments on a capitalized lease obligation.

The Company has funded its cash needs from inception through December 31, 2002
with a series of debt and equity transactions, including private placements.

On October 24, 2002, the Company acquired the assets of an unrelated Colorado
corporation through an agreement and plan for merger. The assets consisted of
$200,000 cash and a $550,000 promissory note receivable due on or before
February 20, 2003. All liabilities of the acquired corporation were discharged
prior to the merger. As consideration for the merger, the Company issued 1,000
common shares and 750 shares of its newly created Series B 2% convertible
preferred stock to the corporation's sole shareholder subsequent to year-end.
There were no operations of the acquired corporation prior to the merger.

The Company has 750,000 shares of preferred stock outstanding at December 31,
2002, which is convertible at the option of the shareholder into 7,500,000
shares of common stock. During 2002, 200,000 referred shares were converted into
2,000,000 common shares by two of the Company's officers and majority
shareholders. During 2001, the Company's officers and majority shareholders
converted 50,000 preferred shares in to 500,000 common shares.

The Company has suffered recurring losses and has yet to generate an internal
cash flow. The Company will substantially rely on the revenues from the home
cleaning business and from the revenues of the beauty salons in Boca Raton,
Florida, Coral Springs, Florida and Las Vegas, Nevada. The Company projects that
current and projected revenues and capital reserves will sustain it for 12
months along with the cash it raised on the equity placement in 2002. If the
projected revenues of these sources fall short of needed capital because of a
decrease in demand for the company's services as well as other factors, the
Company may not be able to sustain its capital needs for more than twelve
months. The Company will then need to obtain additional capital through equity
or debt financing to sustain operations for an additional year. A lack of
significant revenues beginning in the first quarter of 2004 will significantly
affect the cash position of the Company and move the Company toward a position
where the raising of additional funds through equity or debt financing will be
necessary.

On a long-term basis, liquidity is dependent on continuation and expansion of
operations, receipt of revenues, additional infusions of capital and debt
financing. The Company is considering launching a wide scale marketing and
advertising campaign. The current Company's capital and revenues are not
sufficient to fund such a campaign. If the Company chooses to launch such a
campaign it well require substantially more capital. If necessary, the Company
plans to raise this capital through an additional follow-on stock offering. The
funds raised from this offering will be used to develop and execute the
marketing and advertising strategy that may include the use of television,
radio, print and Internet advertising. Funds would also be used to acquire
beauty salons. However, the Company may not be able to obtain additional equity
or debt financing in the future, if at all. If the Company is unable to raise
additional capital, the growth potential will be adversely affected.
Additionally, the Company will have to significantly modify its plans.

Financing activities for the years ended December 31, 2002 and 2001 consisted of
principal repayments under the company's capitalized lease obligation its office
equipment. Principal repayments under the capitalized lease obligation for the
years ended December 31, 2002 and 2001 were $2,313 and $2,313, respectively.
Principal repayments of the note payable balance were made in the amount of
$15,000 in 2001.

Basic EPS equals diluted EPS because of the loss above. Preferred stock had no
effect on the calculation of EPS. Common stock purchase options are common stock
equivalents that were excluded from the computation of diluted loss per share.



ITEM  7.     FINANCIAL STATEMENTS

                          INDEPENDENT AUDITORS' REPORT
                          ----------------------------

To the Board of Directors and Stockholders:
NATIONAL BEAUTY CORP. and subsidiaries
4818 West Commercial Boulevard
Fort Lauderdale, Florida  33319

We have audited the accompanying consolidated balance sheet of National Beauty
Corp., a Nevada corporation) and its wholly owned subsidiaries as of December
31, 2002 and the related consolidated statements of operations, stockholders'
equity, and cash flows for the years ended December 31, 2002 and 2001. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audits to obtain reasonable assurance about whether the consolidated
financial statements are free from 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 consolidated 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
National Beauty Corp. (a Nevada corporation) and its wholly-owned subsidiaries
as of December 31, 2002, and the consolidated results of its operations and its
cash flows for the years ended December 31, 2002 and 2001 in conformity with
accounting principles generally accepted in the United States of America.


Pompano Beach, Florida
March 14, 2003

<TABLE>
<CAPTION>

                   NATIONAL BEAUTY CORPORATION & SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEET
                            AS OF DECEMBER 31, 2002
==============================================================================
<S>                                                              <C>
                                                                 Dec. 31, 2002
                                                                 -------------
                            ASSETS
                            ------

CURRENT ASSETS:
---------------
   Cash and cash equivalents                                     $      98,837
   Inventory                                                               500
                                                                 -------------
      TOTAL CURRENT ASSETS                                              99,337

FIXED ASSETS
------------
   Furniture and fixtures                                               38,274
   Leasehold improvements                                                9,500
   Equipment and machinery                                              35,668
      Accumulated depreciation                                         (46,636)
                                                                 -------------
      NET FIXED ASSETS                                                  36,806

OTHER ASSETS:
-------------
   Deposits                                                              8,882
                                                                 -------------
      TOTAL OTHER ASSETS                                                 8,882

         TOTAL ASSETS                                            $     145,025
                                                                 =============

</TABLE>



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

<TABLE>
<CAPTION>

                   NATIONAL BEAUTY CORPORATION & SUBSIDIARIES
                     CONSOLIDATED BALANCE SHEET (CONTINUED)
                            AS OF DECEMBER 31, 2002
==============================================================================
<S>                                                              <C>
                                                                 Dec. 31, 2002
                                                                 -------------

             LIABILITIES AND STOCKHOLDERS' EQUITY
             ------------------------------------

CURRENT LIABILITIES
-------------------
   Accounts payable and accrued expenses                         $         932
                                                                 -------------
      TOTAL CURRENT LIABILITIES                                            932
                                                                 -------------

STOCKHOLDERS' EQUITY
--------------------
   Common stock ($.001 par value, 600,000,000 shares
    authorized; 35,301,062 shares issued and
    outstanding at December 31, 2002)                                   35,301
   Series A convertible preferred stock
    ($.001 par value; 40,000,000 shares authorized,
    750,000 shares issued and outstanding at
    March 31, 2003 and December 31, 2002)                                  750
   Series B 2% convertible preferred stock
    ($.001 par value; 1,000 shares authorized,
    -0- shares issued and outstanding at
    March 31, 2003 and December 31, 2002)                                    -
   Common stock note receivable subscription,
    less allowance for uncollectible loss of $550,000                        -
   Additional paid in capital                                        2,280,163
   Retained deficit                                                 (2,172,121)
                                                                 -------------
      TOTAL STOCKHOLDERS' EQUITY                                       144,093
                                                                 -------------

         TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY              $     145,025
                                                                 =============

</TABLE>




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

<TABLE>
<CAPTION>

                   NATIONAL BEAUTY CORPORATION & SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                 FOR THE YEARS ENDED DECEMBER 31, 2002 AND 2001
==============================================================================

                                                   For the Year Ended Dec. 31,
                                                      2002             2001
                                                   ----------       ----------
<S>                                                <C>              <C>
REVENUES:
---------
   Sales - cleaning                                $  318,709       $  281,124
   Sales - beauty salons                              223,501          150,686
   Cost of sales - cleaning                          (247,106)        (182,731)
   Cost of sales - beauty salons                       (9,104)         (93,244)
                                                   ----------       ----------
         Gross Profit                                 286,000          155,835

EXPENSES:
---------
   Selling, general and administrative              1,171,790          336,240
                                                   ----------       ----------
      Total Expenses                                1,171,790          336,240
                                                   ----------       ----------

         Loss from Operations                      $ (885,790)      $ (180,405)

OTHER (EXPENSE):
----------------
   Unrealized loss on trading securities               (1,500)         (66,257)
   Interest expense                                      (500)          (1,227)
                                                   ----------       ----------
         Total Other Expenses                          (2,000)         (67,484)
                                                   ----------       ----------

         Net loss from discontinued operations              -           (9,156)

         NET LOSS                                  $ (887,790)      $ (257,045)
                                                   ==========       ==========

Basic and fully diluted net loss per common share:
         Continuing operations                     $    (0.06)      $    (0.55)
                                                   ==========       ==========
         Discontinued operations                   $        -       $    (0.02)
                                                   ==========       ==========

  Weighted average common shares outstanding       14,177,091          448,016
                                                   ==========       ==========

</TABLE>




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

<TABLE>
<CAPTION>

                   NATIONAL BEAUTY CORPORATION & SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                 FOR THE YEARS ENDED DECEMBER 31, 2002 AND 2001
==============================================================================

                                                      2002             2001
                                                   ----------       ----------
<S>                                                <C>              <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
-------------------------------------
   Net loss                                        $ (887,790)      $ (257,044)
   Adjustments to reconcile net loss to
    net cash (used in) operating activities:
      Depreciation                                     10,275            3,017
      Common stock issued for services                383,590          235,044
      Warrants issued                                 327,758              -0-
      Unrealized loss on trading securities             1,743           66,257
     (Increase) decrease in operating assets:
      Accounts receivable                                 903              781
      Inventory                                         1,200            1,863
      Shareholder loan receivable                         -0-            7,892
      Prepaid expenses                                 90,000          (90,000)
      Deposits                                         (2,226)          (2,956)
      Increase (decrease) in operating liabilities
      Accounts payable and accreud expenses              (299)             -0-
                                                   ----------       ----------
         NET CASH (USED IN) OPERATING ACTIVITIES      (74,846)         (35,146)
                                                   ----------       ----------

CASH FLOWS FROM INVESTING ACTIVITIES:
-------------------------------------
      Expenditures for fixed assets                   (23,341)          (4,395)
                                                   ----------       ----------
         NET CASH USED IN INVESTING ACTIVITIES        (23,341)          (4,395)
                                                   ----------       ----------

CASH FLOWS FROM FINANCING ACTIVITIES:
------------------------------------
   Proceeds from shareholder loan payable              25,000              -0-
   Repayment of shareholder loan payable              (25,000)             -0-
      Outstanding checks in excess of bank balance    (11,664)          11,664
   Proceeds from equity placement                     200,000              -0-
   Principal repayments of note payable                   -0-          (15,000)
   Principal repayments under capitalized lease        (2,313)          (2,313)
                                                   ----------       ----------
         NET CASH PROVIDED BY (USED)
          IN FINANCING ACTIVITIES                     186,023           (5,649)
                                                   ----------       ----------

      NET INCREASE (DECREASE) IN
       CASH AND CASH EQUIVALENTS                       87,836          (45,190)

      CASH AND CASH EQUIVALENTS,
         BEGINNING OF THE YEAR                         11,001           56,191
                                                   ----------       ----------

         END OF THE PERIOD                         $   98,837       $   11,001
                                                   ==========       ==========

SUPPLEMENTARY CASH FLOW INFORMATION OF NON-CASH FINANCING:
----------------------------------------------------------
   Common stock issued to officers for services,
    charged to prepaid expense                     $        -       $   28,500
                                                   ==========       ==========
   Common stock issued to others for services,
    charged to prepaid expense                     $        -       $   61,500
                                                   ==========       ==========
   Common stock issued to officers for
    other services                                 $  231,890       $   25,044
                                                   ==========       ==========
   Common stock issued to others for
    other services                                 $  151,700       $  120,000
                                                   ==========       ==========
   Assumption of note payable in connection
    with assets acquisition                        $        -       $   15,000
                                                   ==========       ==========
   200,000 preferred shares converted in to
    2,000,000 common shares by officers            $        -       $        -
                                                   ==========       ==========
   Warrants issued                                 $  327,758       $        -
                                                   ==========       ==========
</TABLE>


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

<TABLE>
<CAPTION>

                   NATIONAL BEAUTY CORPORATION & SUBSIDIARIES
                 CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
                 FOR THE YEARS ENDED DECEMBER 31, 2002 AND 2001
==============================================================================

                                    Convertible Series      Additional
                   Common Stock    "A" Preferred Stock  Paid-in   Retained
                   ------------     ------------------
                  Shares   Amount   Shares     Amount   Capital     Deficit
                  ------   ------   ------     ------   -------     -------
<S>               <C>      <C>      <C>        <C>      <C>         <C>

Balances,
January 1, 2001   58,425   $   58   1,000,000  $1,000   $1,168,314  $(1,027,286)

Common stock
issued for
services         907,937      908         -0-     -0-      234,136          -0-

Conversion of preferred shares into common shares by officers
                 500,000      500     (50,000)    (50)         -0-          -0-

Net loss for
the year             -0-      -0-         -0-     -0-          -0-     (257,045)
                  ------   ------   ---------  ------   ----------  -----------
Balances,
December 31,
2001           1,466,362   $1,466     950,000  $  950   $1,402,450  $(1,284,331)

Common stock
issued for
services       1,834,700    1,835         -0-     -0-      349,955          -0-

Equity
Placement
to investors         -0-      -0-         -0-     -0-      200,000          -0-

Common shares in escrow for equity placement
              30,000,000   30,000         -0-     -0-          -0-          -0-

Warrants issued      -0-      -0-         -0-     -0-      327,758          -0-

Conversion of preferred shares into common shares by officers
               2,000,000    2,000    (200,000)   (200)         -0-          -0-

Net loss
for the year         -0-      -0-         -0-     -0-          -0-     (887,790)
                  ------   ------   ---------  ------   ----------  -----------
Balances,
December 31,
2002          35,301,062  $35,301     750,000  $  750   $2,280,163  $(2,172,121)
                  ======   ======   =========  ======   ==========  ===========

</TABLE>


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


                      NATIONAL BEAUTY CORP. & SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 For the Years Ended December 31, 2002 and 2001
                 ==============================================

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
---------------------------------------------------

Business Activity - National Beauty Corp. (formerly known as Beautymerchant.com,
-----------------
Inc.) (a Nevada corporation) legally changed its corporate name in 2001 and was
also formerly known as ATR Industries, Inc., a Nevada corporation, which was
incorporated in 1987. On September 12, 2002, one of the Company's subsidiaries
legally changed its name to Hairmax of Florida, Inc. from Beautyworks USA of
Florida, Inc.

These financial statements include its wholly owned subsidiaries, Cleaning
Express USA, Hairmax of Florida, Inc. (FKA Beauty Works USA, Inc.) and Beauty
Merchant, Inc. Beauty Merchant operations were ceased in 2001. The company is a
full service cleaning company offering daily residential cleaning services,
carpet cleaning and other related services in the South Florida area under the
name of Cleaning Express USA. The Company also offers beauty salon services and
products though its two retail beauty salons in the South Florida area under its
Hairmax of Florida, Inc. subsidiary.

Accounts Receivable - Accounts receivable are charged to bad debt expense as
-------------------
they are deemed uncollectible based upon a periodic review of the accounts. The
Company performs ongoing credit reviews of its customer accounts.

Property and Equipment - Property and Equipment are recorded at cost.
----------------------
Maintenance and repair costs are expensed as incurred. Depreciation is provided
using the straight-line method and other methods that approximate the
straight-line method. It is calculated over recovery periods as prescribed by
management that range from 5 years for equipment to 7 years for furniture.
Leasehold improvements are amortized over the terms of the office and salon
operating leases.

When an asset is disposed of, its cost and related accumulated depreciation are
removed from the accounts. The difference between undepreciated cost and
proceeds from disposition is recorded as gain or loss.

The Company makes ongoing evaluations of the values of its assets to determine
whether an impairment write-down should be recognized in accordance with SFAS
No. 144. To date, no such impairment write-down has been deemed necessary.

Marketable Securities - Marketable securities include the Company's investment
---------------------
in equity securities recorded at fair market value. The marketable securities
were classified as trading securities with holding gains and losses recognized
in current period operations.


                      NATIONAL BEAUTY CORP. & SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 For the Years Ended December 31, 2002 and 2001
                 ==============================================

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)
-----------------------------------------------------------

Cash and Cash Equivalents - For purposes of the Statement of Cash Flows, the
-------------------------
Company considers highly liquid investments with an original maturity of three
months or less to be cash equivalents.

Revenue Recognition - Revenue for the residential cleaning operations is
-------------------
recognized when cleaning services are performed.

Revenues for beauty salon services are recognized when the services are
rendered. Revenues for beauty products are recognized when the products are
shipped provided collection of the resulting receivable is probable and the
earnings process is complete. If any material contingencies are present, revenue
recognition is delayed until all material contingencies are eliminated. Material
contingencies are circumstances in which there are any potential uncertainties
as to the completion of the revenue process being complete. Further, no revenue
is recognized unless collection of the applicable consideration is probable.
Probable collection is determined at the time collection occurs or is more than
reasonably possible it will be collected.

Income Taxes - Income taxes are provided for the tax effects of transactions
------------
reported in the financial statements and consist of deferred taxes related
primarily to differences between the basis of certain assets and liabilities for
financial and tax reporting. Deferred taxes represent the future tax return
consequences of those differences, which will either be taxable or deductible
when the assets and liabilities are recovered or settled.

The income tax benefit consists of taxes currently refundable due to net
operating loss carryback provisions for federal and state governments. Deferred
tax assets are reduced by a valuation allowance when, in the opinion of
management, it is more likely than not that some portion or the entire deferred
tax asset will not be realized. Deferred tax assets and liabilities are adjusted
for the effect of changes in tax laws and rates on the date of enactment.

Use of Estimates - The preparation of financial statements in conformity with
----------------
accounting principles generally accepted in the United States requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosures of contingent assets and liabilities at
the date of financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates.


                      NATIONAL BEAUTY CORP. & SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 For the Years Ended December 31, 2002 and 2001
                 ==============================================

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)
-----------------------------------------------------------

Advertising - The Company charges the costs of advertising to expense when
-----------
incurred.

Earnings Per Share - The Company reports earnings per share in accordance with
------------------
Statement of Financial Accounting Standard (SFAS) No.128. This statement
requires dual presentation of basic and diluted earnings (loss) with a
reconciliation of the numerator and denominator of the loss per share
computations. Basic earnings per share amounts are based on the weighted average
shares of common outstanding. If applicable, diluted earnings per share would
assume the conversion, exercise or issuance of all potential common stock
instruments such as options, warrants and convertible securities, unless the
effect is to reduce a loss or increase earnings per share. Accordingly, this
presentation has been adopted for the period presented. There were no
adjustments required to net loss for the period presented in the computation of
diluted earnings per share. There were 34,000 common stock equivalents excluded
from the computation of diluted loss per share.

NOTE B - ACQUISITIONS
---------------------
During 2001, the Company acquired the fixed assets of a beauty salon in South
Florida. The Company financed the acquisition with a short-term note with the
unrelated seller in the amount of $15,000 at 8% interest per annum. This note
was paid in full with interest thereto during 2001. The Company also assumed the
lease from the seller. See footnote F below for the minimum lease commitments.
Since the acquisition does not meet the conditions of a significant acquisition,
pro forma information has not been provided.

On October 24, 2002, the Company acquired the assets of an unrelated Colorado
corporation through an agreement and plan for merger. The assets consisted of
$200,000 cash and a $550,000 promissory note receivable due on or before
February 20, 2003. All liabilities of the acquired corporation were discharged
prior to the merger. As consideration for the merger, the Company issued 1,000
common shares and 750 shares of its newly created Series B 2% convertible
preferred stock to the corporation's sole shareholder subsequent to year-end.
There were no operations of the acquired corporation prior to the merger. Since
the acquisition does not meet the conditions of a significant acquisition, pro
forma information has not been provided.

NOTE C - DISCONTINUED OPERATIONS
--------------------------------

In November 2001, the Board of Directors approved a plan for the disposal of its
e-commerce segment. The results of beautymerchant.com have been reported as
discontinued operations for 2001.


                      NATIONAL BEAUTY CORP. & SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 For the Years Ended December 31, 2002 and 2001
                 ==============================================

NOTE D - CONVERTIBLE PREFERRED STOCK
------------------------------------

Series "A" Preferred Stock
--------------------------

During 2002, subject to a majority vote of the Company's shareholders, the
Company reduced the number of shares of the Series "A" convertible preferred
from 50,000,000 to 40,000,000 shares.

The Company has 750,000 shares of Series "A" preferred stock outstanding at
December 31, 2002, which is convertible at the option of the shareholder into
7,500,000 shares of common stock. During 2002, 200,000 preferred shares were
converted into 2,000,000 common shares by two of the Company's officers and
majority shareholders. During 2001, the Company's officers and majority
shareholders converted 50,000 preferred shares in to 500,000 common shares.

Series "B" Preferred Stock
--------------------------

During 2002, subject to a majority vote the Company's shareholders, the Company
authorized the creation of a new 1,000 authorized shares of Series "B" 2%
convertible preferred shares. The shares of Series "B" preferred stock is
convertible at a redemption price of 115% of the stated value of each share of
Series "B" stock plus accrued and unpaid dividends. The shares of the Series "B"
stock have no voting power.

NOTE E - COMMON STOCK
---------------------

During the year ended December 31, 2001, the Company enacted a 200 for 1 reverse
stock split on its common stock. All common stock amounts in the accompanying
financial statements have been retroactively restated to reflect this
capitalization change.

On December 27, 2001, the Company issued 95,000 and 205,000 common shares to its
officers and outside consultants, respectively. These common shares were paid in
advance for services to be received by the Company in 2002 and were reflected as
prepaid expenses in the December 31, 2001 balance sheet and expensed in the
accompanying 2002 statement of operations. The shares were priced at the date of
issuance yielding an aggregate market value of $90,000. In addition, 34,000
options were granted to an outside consultant as part of compensation for 2001.
The options are exercisable at $.48 per share prior to December 31, 2005. The
options did not yield a material expense using the Black-Scholes Option Pricing
Model. See footnote I below for stock warrants issued during 2002.


                      NATIONAL BEAUTY CORP. & SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 For the Years Ended December 31, 2002 and 2001
                 ==============================================

NOTE E - COMMON STOCK (CONT.)
-----------------------------

During the year ended December, 31 2001, the Company issued 607,937 shares of
its common stock for services rendered by officers and outside consultants. The
shares were valued at the date of issuance yielding an aggregate market value of
$145,044, which was expensed during the year.

During the year ended December, 31 2002, the Company issued 1,835,000 shares of
its common stock for services rendered by officers and outside consultants. The
shares were valued at the date of issuance yielding an aggregate market value of
$383,590, which was expensed during the year.

During 2002, the Company filed a Certificate of Amendment to Articles of
Incorporation with the State of Nevada to increase the number of authorized
common shares to 600,000,000, with a continued par value of $.001. A majority of
the Company's shareholders voted to approved this transaction.

Pursuant to the 2002 acquisition discussed in footnote B above, the Company
issued 30,000,000 common shares to an independent law firm acting as legal
escrow agent for safekeeping. These common shares are considered as outstanding
for purposes of the weighted average share computation in the accompanying
statements of operations. These common shares are reserved for future exercise
of warrants issued during 2002 as discussed in footnote H below and the future,
if any, redemption of the series B convertible preferred stock discussed above
herein.


NOTE F - INCOME TAXES
---------------------

The Company has approximately $902,000 of federal and state net operating losses
available that expire in various years through the year 2016.

Due to operating losses, there is no provision for current federal or state
income taxes for the years ended December 31, 2002 and 2001.

Deferred income taxes reflect the net tax effects of temporary differences
between the carrying amounts of assets and liabilities for financial reporting
purposes and the amount used for federal and state income tax purposes.

The Company's deferred tax asset at December 31, 2002 consists of net operating
loss carry forwards calculated using federal and state effective tax rates
equating to approximately $352,000 less a valuation allowance in the amount of
approximately $352,000, respectively. Because of the

                      NATIONAL BEAUTY CORP. & SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 For the Years Ended December 31, 2002 and 2001
                 ==============================================

NOTE F - INCOME TAXES (CONT.)
-----------------------------

Company's lack of earnings history, the deferred tax asset has been fully offset
by a valuation allowance. The valuation allowance increased by approximately
$76,000 and $8,000 for the years ended December 31, 2002 and 2001, respectively.

The Company's total deferred tax asset as of December 31, 2002 is as follows:

     Net operating loss carry forwards          $   352,000
     Valuation allowance                           (352,000)
                                                -----------

     Net deferred tax asset                     $        --
                                                ===========

The reconciliation of income taxes computed at the federal statutory income tax
rate to total income taxes for the years ended December 31, 2002 and 2001 is as
follows:

                                                             2002          2001
                                                             ----          ----
     Income tax computed at the federal statutory rate        34%           34%
     State income taxes, net of federal tax benefit            5%            5%
                                                             ----          ----
     Valuation allowance                                     (39%)         (39%)
                                                             ----          ----
     Total deferred tax asset                                  0%            0%
                                                             ====          ====

NOTE G - COMMITMENTS
--------------------

The Company leases its executive offices in Fort Lauderdale, Florida and a
beauty salons in Boca Raton, Florida, Coral Springs, Florida and Las Vegas,
Nevada under non-cancelable operating leases that expire from varying dates
through December 31, 2007. Future minimum rental payments as of December 31,
2002 in the aggregate and for each of the five succeeding years are as follows:

Year                                Amount
----                               --------
2003                               $107,728
2004                                108,529
2005                                 91,573
2006                                 58,216
2007                                 47,444
                                   --------
                                   $413,490
                                   ========


                      NATIONAL BEAUTY CORP. & SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 For the Years Ended December 31, 2002 and 2001
                 ==============================================

NOTE G - COMMITMENTS (CONT.)
----------------------------

Rent expense for 2002 and 2001 was $55,841 and $47,467, respectively.

In 1999, the Company committed itself to compensate each of its Board of
Directors in the amount of 1,000 shares of its common stock annually and 10,000
common stock purchase options over a thirty six-month period. As of the date of
this report, no option agreement has been officially adopted, there is no fair
market value for the options and none of the equity instruments have been issued
with the exception of 1,000 restricted common shares issued to each of its
directors in 2002 and 2001.

The Company is committed to two employment agreements through April 1, 2007.
Pursuant to the agreements, two of the Company's officers and majority
shareholders shall receive total combined annual salaries of $325,000 and a
combined 300,000 preferred shares per annum.

The Company is committed to another employment agreement through April 5, 2005.
Pursuant to the agreement, the Company's officer and minority shareholder shall
receive annual compensation of $50,000 with 6% annual increases.

NOTE H - SEGMENT INFORMATION
----------------------------

Based on the criteria established by SFAS 131, "Disclosures about Segments of an
Enterprise and Related Information," the Company operates in two principal
business segments - (1) residential cleaning service and (2) retail beauty
salons. In accordance with SFAS 131, the Company is required to describe its
reportable segments and provide data that is consistent with the data made
available to the Company's management to assess performance and make decisions.
Information from the internal management reports may differ from the amounts
reported under generally accepted accounting principles. The assets of the
discontinued subsidiary are reflected as corporate assets. Summarized revenues
and expense information by segment for 2002 and 2001, as excerpted from the
internal management reports, is as follows:

                                    2001                 2002
                                  ---------            ---------
Residential Cleaning:
---------------------
Residential cleaning sales        $281,124             $318,709
Cost of sales                     (182,731)            (247,106)
Corporate and other expenses      (220,436)            (644,760)
                                  ---------            ---------
     Segment loss                 (122,043)            (573,157)


                      NATIONAL BEAUTY CORP. & SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 For the Years Ended December 31, 2002 and 2001
                 ==============================================

NOTE H - SEGMENT INFORMATION (CONT.)
------------------------------------

                                          2001                        2002
                                       ----------                  ----------

Total assets                                9,550                       6,752

Capital expenditures                          -0-                         -0-

Depreciation                                  -0-                         -0-

Interest expense                              240                         -0-

Retail beauty salons:
---------------------
Retail beauty salon sales              $  150,686                  $  223,501
Cost of sales                             (93,244)                     (9,104)
Corporate and other expenses             (117,031)                   (339,964)
                                       ----------                  ----------
     Segment loss                         (59,589)                   (125,567)

Total assets                               13,500                      43,322

Capital expenditures                        1,538                      23,341

Depreciation                                1,056                       8,141

Interest expense                              429                         -0-

Corporate:
----------
Corporate  revenues                    $      N/A                  $      N/A
Cost of sales                                 -0-                         -0-
Unallocated and other expenses            (66,257)                   (187,566)
                                       ----------                  ----------
     Segment loss                         (66,257)                   (187,566)

Total assets                              113,693                      94,951

Capital expenditures                        2,857                         -0-

Depreciation                                1,961                       2,134

Interest expense                              558                         -0-


                      NATIONAL BEAUTY CORP. & SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 For the Years Ended December 31, 2002 and 2001
                 ==============================================

NOTE I - STOCK WARRANTS
-----------------------

During 2002, the Company issued stock warrants to the entity associated with the
2002 acquisition as discussed above in footnote D. The stock warrants allow the
entity to purchase shares of the Company's stock at a price per share per the
warrant agreement of $.001. The warrants allow the entity to purchase one common
share of the Company's stock for each warrant. The warrants expire in August
2007 per the warrant agreement. The Company did not grant any registration
rights with respect to any shares of common stock issuable upon exercise of the
warrants. During the year ended December 31, 2002, the Company recorded an
expense of approximately $328,000, equal to the estimated fair value of the
options at the date of grants. The fair market value was calculated using the
Black-Scholes options pricing model, assuming 5% risk-free interest, 0% dividend
yield, 60% volatility, and an expected live of five years.

NOTE J - NOTE RECEIVABLE
------------------------

The Company has a $550,000 note receivable from the shareholder of the
corporation it acquired in 2002 as evidenced by a signed promissory note. The
Note, which was due in full on February 20, 2003, was in default pending a
Modification Agreement. On March 26, 2003, based on the terms of the
Modification Agreement, the shareholder agreed to pay the Company in weekly
installments of $33,000 until the note has been satisfied. The note receivable
has been fully reserved for at December 31, 2002 in the accompanying balance
sheet. The note bears interest at 2% per annum and interest income was charged
to operations due to uncollectibility thereof.

NOTE K - RELATED PARTY TRANSACTION
----------------------------------

During the year ended December 31, 2002, the Company borrowed $25,000 from its
majority shareholder to assist in funding for the merger disclosed in footnote
B. The transaction was supported by a promissory note bearing interest of 15%
interest per annum. The note and related interest were paid in October 2002 and
no liability exists for the Company at December 31, 2002.

NOTE L - SUBSEQUENT EVENT
-------------------------

On February 1, 2003, the Company entered into a consulting agreement with an
unrelated corporation. The term of the contract is five months and the Company
paid the consultant 200,000 restricted common shares for the month of February
2003 and is committed to pay 75,000 restricted common shares per month for the
next four months.


                      NATIONAL BEAUTY CORP. & SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 For the Years Ended December 31, 2002 and 2001
                 ==============================================

NOTE M - RECENT ACCOUNTING PRONOUNCEMENTS
-----------------------------------------

In July 2001, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards (SFAS) No.143, "Accounting for Asset Retirement
Obligations" which addresses the accounting and reporting for obligations
associated with the retirement of tangible long-lived assets and the associated
retirement costs. SFAS No. 143 requires that the fair value of a liability for
an asset retirement obligation be recognized in the period in which it is
incurred if a reasonable estimate of fair value cannot be made. SFAS No. 143 is
effective for financial statements issued for fiscal years beginning after June
15, 2002. The Company does not expect SFAS No. 143 to have a material effect on
its financial condition or cash flows.

In August 2001, the FASB issued SFAS No. 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets". SFAS No. 144 generally establishes a standard
framework which to measure impairment of long-lived assets and expands the
Accounting Principles Board ("APB") 30, "Reporting the Results of Operations -
Reporting the Effects of Disposal of a Segment of a Business, and Extraordinary,
Unusual and Infrequently Occurring Events and Transactions" to include a
component of the entity (rather than a segment of the business). SFAF No. 144 is
effective for financial statements issued for fiscal years beginning after
December 15, 2001. The Company does not expect SFAS No. 144 to have a material
effect on its financial condition and cash flows.

In June 2002, the FASB issued SFAS No. 146, "Accounting for Costs Associated
with Exit or Disposal Activities" effective for exit or disposal activities
initiated after December 31, 2002. The standard addresses financial accounting
and reporting for costs associated with exit or disposal activities and
nullifies Emerging Issues Task Force No. 94-3. SFAS No. 146 essentially requires
a liability to be recognized and measured initially at its fair value in the
period in which the liability is incurred for a cost associated with an exit or
disposal activity. The implementation of the pronouncement does not have
material effect on its financial condition and cash flows.


ITEM  8.     CHANGES WITH AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
             AND FINANCIAL DISCLOSURE

     None.


ITEM  9.     DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

(a)     Identification of Directors

The following information, as of March 31, 2003 is furnished with respect to
each Director and Executive Officer:

                                  Date of
Name of Director          Age     Service        Position with Company
----------------          ---     -------        ---------------------

Edward A. Roth             45      1997          Chairman, President & CEO
Alisha Roth                37      1997          Secretary, Treasurer, Director
Barbara Patigalia          52      1997          Director
Michael J. Bongiovanni     40      2000          Chief Financial Officer

All Directors serve for one-year terms, which expire at the annual shareholders
meeting in 2003.

All officers serve at the pleasure of the Board.

There are no arrangements or understandings pursuant to which any of them were
elected as officers.

Edward A. Roth has been President and Director of the Company since 1997. Mr.
Roth previously served as Vice-President and Director of Operations for Cleaning
Express USA since its inception in November 1994. During this period, Mr. Roth
developed and implemented all operations and developments creating a company
that started with less than 50 customers, and today services over 8,000
customers in South Florida. Mr. Roth was President of Advanced Appearance, a
chain of Beauty Salons, in Alabama and Florida form 1978 to 1988. Prior to this
Mr. Roth served as a management consultant working independently for 20 years.
Mr. Roth has attended Auburn University majoring in business and marketing, and
is also a veteran of the United States Air Force. Edward A. Roth is married to
Alisha M. Roth

Michael J. Bongiovanni has been Chief Financial Officer of the Company since
April 2000. Mr. Bongiovanni is responsible for SEC reporting compliance and
financial analysis of new operations including Beautyworks USA, Inc. Mr.
Bongiovanni has served numerous publicly traded companies in financial
consulting and business management since 1980. Mr. Bongiovanni received his
Masters of Accounting degree at Florida Atlantic University.

Alisha M. Roth has served as Secretary and Director of the Company since 1997.
Mrs. Roth served previously as President of Cleaning Express USA, and during her
tenure she was in charge of staffing and customer relations. Mrs. Roth has been
with Cleaning Express USA since 1994, prior to that she was a resident of
Trinidad, West Indies. Mrs. Roth has owned and operated her own business in the
restaurant and pre-school development areas, and has 8 years of management
experience. Alisha M. Roth is married to Edward A. Roth.

Barbara Patigalia is a language pathologist with the Head Start program in
Maryland, and serves as President of the League of Women Voters in Potomac,
Maryland. Ms. Patigalia had no business experience during the last 5 years,
except other than through her role as a director of the Company.

There have been no events under any bankruptcy act, no criminal proceedings and
no judgments or injunctions material to the evaluation of the ability and
integrity of any director or executive officer during the past 5 years.

Section 16(a) Beneficial Ownership Reporting Compliance

Based on information furnished to Registrant, no officer, director, or ten
percent shareholder failed to file on a timely basis reports on Forms 3, 4, or 5
during the most recent two fiscal years.

ITEM  10.     EXECUTIVE COMPENSATION

     Summary Compensation Table

The following table sets forth in summary form the compensation received during
each of the Company's last three completed fiscal years by the Chief Executive
Officer and President of the Company. No executive officer of the Company,
including the Chief Executive Officer and President, received total salary and
bonus exceeding $100,000 during any of the last three fiscal years.

Summary Compensation Table

<TABLE>
<CAPTION>


Name         Fiscal   Annual  Bonuses  Other    Restricted  LTIP     Restricted
And          Year     Salary           Compen   Stock       Options  Stock
Position                               -sation  Awards               Bonuses
--------     ------   ------  -------  -------  ----------  -------  ----------
                        (1)     (2)      (3)       (4)
--------     ------   ------  -------  -------  ----------  -------  ----------
<S>          <C>      <C>     <C>      <C>      <C>         <C>      <C>

Edward A.    2002     $197,000    -0-      -0-         -0-      -0-         -0-
Roth,CEO     2001     $ 65,000    -0-      -0-         -0-      -0-         -0-
And          2000     $233,121    -0-      -0-         -0-      -0-         -0-
President
--------     ------   ------  -------  -------  ----------  -------  ----------
Michael J.   2002     $ 22,890    -0-      -0-         -0-      -0-         -0-
Bongiovanni, 2001     $ 15,000    -0-      -0-      25,000      -0-         -0-
CFO          2000     $ 46,800    -0-      -0-         -0-      -0-         -0-
--------     ------   ------  -------  -------  ----------  -------  ----------
Alisha Roth, 2002     $ 48,000    -0-      -0-         -0-      -0-         -0-
Secretary,   2001     $    -0-    -0-      -0-         -0-      -0-         -0-
Treasurer    2000     $ 60,000    -0-      -0-         -0-      -0-         -0-
--------     ------   ------  -------  -------  ----------  -------  ----------
</TABLE>


(1)  The dollar value of base salary (cash and non-cash) received.

(2)  The dollar value of bonus (cash and non-cash) received.

(3)  During the periods covered by the Summary Compensation Table, the Company
     did not pay any other annual compensation not properly categorized as
     salary or bonus, including perquisites and other personal benefits,
     securities or property.

(4)  Issuances of restricted stock for services rendered. These shares were
     valued at the then average bid-ask price.

Compensation of Directors

The Company pays its non-employee directors' 1,000 shares of the Company's
restricted common stock per year for Directors' Meetings attended. It is
anticipated that no more than twelve meetings will occur each year. Employee
directors are not compensated for services rendered as directors of the company.

Employment Contracts and Termination of Employment and Change-In Control
Arrangements

National Beauty is committed to two employment agreements through April 1, 2007.
Pursuant to the agreements, Edward and Alisha Roth, two of the company's
officers and majority shareholders shall receive total combined annual salaries
of $325,000 and a combined 300,000 preferred shares per annum.

ITEM  11.     SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

(a)  Security Ownership of Certain Beneficial Owners

All persons known by the Registrant to own beneficially more than 5% of any
class of the Company's outstanding stock on March 31, 2003, are listed below:

<TABLE>
<CAPTION>

Title                Name and Address      # Shares     Nature of    Current %
of Class                                                Ownership    Owned (w)
----------------     ------------------    ---------    ---------    ---------
<S>                  <C>                   <C>          <C>          <C>
Common Stock,        Edward A. Roth        3,506,440       (x)          10%
$.001 Par            4810 W. Commercial
Value                Blvd. Lauderhill,
                     FL 33319
----------------     ------------------    ---------    ---------    ---------
Preferred Stock,     Edward A. Roth
$.001 Par Value      4810 W. Commercial
(z)                  Blvd. Lauderhill,       750,000       (y)         100%
                     FL 33319
----------------     ------------------    ---------    ---------    ---------
</TABLE>

     (w)  On March 31, 2003, there were 35,501,062 shares of common stock issued
          and outstanding. Note that 30,000,000 of these aforementioned common
          shares above are being held in an escrow collateral account awaiting
          certain financing.
     (x)  Mr. & Mrs. Roth own the common shares as joint tenants.
     (y)  Mr. & Mrs. Roth own the preferred shares as joint tenants.
     (z)  Each share of preferred stock is convertible into ten shares of common
          stock.

(b)  Security Ownership of Management

The following table sets forth the number of shares owned beneficially on March
31, 2003, by each Director and by all Officers and Directors as a group.
Information as to the beneficial ownership is based upon statements furnished to
the Company by such persons.

<TABLE>
<CAPTION>


Title                Name and Address      # Shares     Nature of    Current %
of Class                                                Ownership    Owned (w)
----------------     ------------------    ---------    ---------    ---------
<S>                  <C>                   <C>          <C>          <C>
Common Stock,        Edward A. Roth        3,506,440       (x)          10%
$.001 Par            4810 W. Commercial
Value                Blvd. Lauderhill,
                     FL 33319
----------------     ------------------    ---------    ---------    ---------
Common Stock,        Michael J.
$.001 Par            Bongiovanni
Value                21311 W. Catawba            -0-       Direct        **
                     Ave. Charlotte,
                     NC 28031
----------------     ------------------    ---------    ---------    ---------
Common Stock,        Barbara Patagalia        67,000       Direct        **
$.001 Par            4810 W. Commercial
Value                Blvd. Lauderhill,
                     FL 33319
----------------     ------------------    ---------    ---------    ---------
Common Stock,        All Officers and      3,573,440       Direct       10%
$.001 Par            Directors as a
Value                Group
----------------     ------------------    ---------    ---------    ---------
Preferred Stock,     Edward A. Roth
$.001 Par Value      4810 W. Commercial
(z)                  Blvd. Lauderhill,       750,000       (y)         100%
                     FL 33319
----------------     ------------------    ---------    ---------    ---------
</TABLE>



** Less than .01%

     (w)  On March 31, 2003, there were 35,501,062 shares of common stock issued
          and outstanding.
     (x)  Mr. & Mrs. Roth own the common shares as joint tenants.
     (y)  Mr. & Mrs. Roth own the preferred shares as joint tenants.
     (z)  Each share of preferred stock is convertible into ten shares of common
          stock.

(c)  Changes in Control

The Company knows of no arrangements that may at a subsequent date result in a
change of control in the Company.


ITEM  12.     CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

(a)  On February 11, 2002, National Beauty issued 1,000,000 shares,
     respectively, to Edward Roth and Alisha Roth, officers and directors of the
     company. These shares were issued as a result of the Roth's conversion of
     the aggregate of 200,000 shares of Series A Preferred Stock into common
     stock on a 10 to 1 basis

ITEM  13.     EXHIBITS AND REPORTS ON FORM 8-K

(a)  Financial Statements
     1.   The following financial statements of National Beauty Corp. &
          Subsidiaries are included in Part II, Item 7:

Independent Auditors' Report                              14
Balance Sheet-December 31, 2002                        15-16
Statements of Operations - years ended
     December 31, 2002 and 2001                        17-18
Statements of Cash Flows - years ended
     December 31, 2002 and 2001                        19-20
Statements of Stockholders' Equity - years ended
     December 31, 2002 and 2001                           21
Notes to Financial Statements                          22-28

     2.   Exhibits
          99. Certifications of Management

     3.   Articles of incorporation, bylaws and related amendments are
          incorporated by reference to Exhibit No. 1 of Form 10-SB filed
          November 1999.


(b)  Reports on Form 8-K
     There were no reports on Form 8-K for the three months ended
     December 31, 2002.


                           --Signature Page Follows--


                                   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.


                                         NATIONAL BEAUTY CORP.
                                         ---------------------
                                        (Registrant)


Date:  March 31, 2003                    /s/ Michael J. Bongiovanni
                                         --------------------------
                                         Michael J. Bongiovanni
                                         Chief Financial Officer


/s/ Edward A. Roth
------------------
Edward A. Roth
President & CEO


/s/ Alisha Roth
---------------
Alisha Roth
Secretary, Treasurer,
Director


/s/ Barbara Patagalia
---------------------
Barbara Patagalia
Director