SECURITIES AND EXCHANGE COMMISSION
                     Washington, D.C.  20549

                           FORM 10-KSB

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

[ ]    Transition Report Pursuant to Section 13 or 15(d) of the Securities
       Exchange Act of 1934.

           For the fiscal year ended December 31, 2002

                 Commission File Number:  0-31619

                      MILLENNIUM QUEST, INC.
                 _______________________________
      (Exact name of Registrant as specified in its Charter)


            DELAWARE                                      87-043032
    _____________________________                       _______________
   (State or other Jurisdiction of                      (I.R.S. Employer
    Incorporation or Organization)                      Identification No.)

        4089 Mount Olympus Way, Salt Lake City, Utah 84124
      ______________________________________________________
       (Address of Principal Executive Offices) (Zip Code)

Registrant's Telephone Number including Area Code:  (801) 278-6990

                         (Not applicable)
                       ___________________
       Former name, former address and former fiscal year,
                  if changed since last report.

Securities Registered Under Section 12(b) of the Exchange Act:  None.

Securities Registered Pursuant to Section 12(g) of the Act: Common Stock, Par
                                                            Value $0.001

Check whether the Registrant (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934, during the 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 is not 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 any amendment to this Form 10-KSB.  [  ]

State issuer's revenues for its most recent fiscal year.  $0.

State the aggregate market value of voting and non-voting common equity held
by non-affiliates computed by reference to the price at which the common
equity was sold, or the average bid and asked price of such common equity, as
of a specified date within the past 60 days: The Company's stock has not
traded on the over-the-counter market for over ten years.  There has been,
therefore, no market for the Company's common stock in the over-the-counter
market.

As of March 24, 2003, the Registrant had outstanding 1,961,643 shares of its
common stock, par value $0.001.

DOCUMENTS INCORPORATED BY REFERENCE:  None.


<PAGE>

                        TABLE OF CONTENTS

ITEM NUMBER AND CAPTION

PART I                                                               Page No.

Item 1.  Description of Business.............................................1
Item 2.  Description of Property.............................................8
Item 3.  Legal Proceedings...................................................8
Item 4.  Submission or Matters to a Vote of Security Holders.................8

PART II

Item 5.  Market for Common Equity and Related Stockholder Matters............8
Item 6.  Management's Discussion and Analysis or Plan of Operation...........9
Item 7.  Financial Statements...............................................10
Item 8.  Changes In and Disagreements With Accountants on Accounting and
         Financial Disclosure...............................................10

PART III

Item 9.  Directors, Executive Officers, Promoters and Control Persons;
         Compliance With Section 16(a) of the Exchange Act..................10
Item 10. Executive Compensation.............................................11
Item 11. Security Ownership of Certain Beneficial Owners and Management.....12
Item 12. Certain Relationships and Related Transactions.....................13
Item 13. Exhibits and Reports on Form 8-K...................................13
Item 14. Controls and Procedures............................................13
Signatures..................................................................14
Certifications..............................................................15

The information contained in this Form 10-KSB for the fiscal year ended
December 31, 2002, is as of the latest practicable date except for financial
information, which relates to the fiscal year.

<PAGE>

                              PART I

                 ITEM 1.  DESCRIPTION OF BUSINESS

General

     Millennium Quest, Inc. (the "Company"), a Delaware corporation, is a
"blank check" company which is attempting to locate a business enterprise
which it may acquire, merge or reorganize with, or become engaged in.  The
Company has been inactive for several years, and to date has not located any
specific business enterprise for its involvement, nor has it entered into any
arrangement or agreements with respect thereto.

History

     Millennium Quest, Inc. (the "Company") was organized under the laws of
the state of Delaware on February 4, 1986, under the name "Teracom, Inc.," for
the purpose of seeking a business opportunity which the Company could acquire,
merge with, or become engaged in.  Immediately following the organization of
the Company, it sold a total of 400,000 shares of common stock, as presently
constituted, to its officers, directors and other shareholders for a total of
$20,000 in cash.  In order to provide the Company with additional capital to
seek to acquire or enter into a business opportunity, in March, 1987, the
Company completed an offering registered by qualification in the State of
Utah, and offered pursuant to an exemption from registration under the
Securities Act of 1933, as amended, as set forth in Rule 504 of Regulation D,
as amended (the "offering").  In the offering, the Company sold a total of
806,750 shares of common stock at a sales price of $.20 per share, as
presently constituted, after giving effect to a 1 for 10 reverse split
effected by the Company in January, 1989, described below, or an aggregate
offering of $161,350.  Following the offering, the original officers,
directors and shareholders contributed back to the Company a total of 58,750
shares of common stock, to meet certain dilution requirements of the Utah
Securities Division, the state in which the offering was conducted.  The
Company received net proceeds from the offering of approximately $133,000
after offering costs.

     In December, 1988, the Company entered into a reorganization with Dix
Hills Equities Group, Inc. ("Dix Hills"), a closely-held Delaware corporation,
which transaction was later rescinded in May, 1994, as described below.  Under
the terms of the reorganization, the Company acquired all of the issued and
outstanding shares of Dix Hills in exchange for the issuance of a total of
4,592,000 shares of restricted common stock, or a controlling interest of
approximately 80%, to the Dix Hills shareholders.  As a result of this
transaction, Dix Hills, a company engaged in the air conditioning and heating
business, became a wholly-owned subsidiary of the Company.  In connection with
the reorganization, the officers and directors of the Company resigned, and
the designees of Dix Hills were appointed as the new directors and officers of
the Company; the Company effected a 1-for-10 reverse split in its issued and
outstanding shares; and the Company changed its name to "Dix Hills Equities
Group, Inc."  All share figures in this report give effect to the 1-for-10
reverse split described above.

     In connection with the reorganization, the Company spent several weeks
reviewing the business and operating results of Dix Hills Equities Group, Inc.
("Dix Hills").  However, due to limited resources, the Company did not seek
the assistance of experts in evaluating or assessing the business and
financial condition of Dix Hills, or in verifying the information and
representations provided by Dix Hills and its representatives.  The
reorganization was entered into in reliance upon numerous representations of
management of Dix Hills, including representations that (a) that the surviving
company would undertake a significant expansion

<PAGE>

plan, and (b) the surviving company had commitments from third parties to
provide substantial additional capital to fund such expansion.  Many of these
representations were contained in the reorganization agreement.  Following the
reorganization, former management learned that management of the successor
company, despite their representations to the contrary, were unable or
unwilling to perform as represented.  As a result, no expansion plan was
implemented, and new management failed to keep the shareholders apprized of
Company activities.  This resulted in the lawsuit described below.  Management
has  concluded that a number of measures could have been undertaken to reduce
the possibility of similar mistakes in the future, including, a more thorough
"due diligence" review of the merger candidate, and, where appropriate, the
use of experts to assist in reviewing the proposed merger candidate;
continuing  participation on the board of directors of the successor company;
penalty provisions and other safeguards in the merger or acquisition agreement
in the event management failed to perform as represented, and the like.  At
the time of the transaction, management had relatively little business
experience.  Since 1988, management has acquired extensive experience in
reviewing and evaluating companies, and in structuring transactions, which
should reduce the likelihood of similar errors in the future.

      In October, 1991, a group of interested shareholders, consisting of
Coombs & Company, a Washington state partnership, and the present officers and
directors, filed a lawsuit in the United States District Court for the
District of Utah, against Dix Hills and the new management of the Company (the
"Dix Hills Group"), alleging a number of claims against the Dix Hills Group,
including federal securities law claims.  In September, 1993, the parties to
the lawsuit entered into a settlement agreement, under the terms of which the
Dix Hills Group agreed to rescind the reorganization agreement, and to return
the control and status of the public company back to its pre-acquisition
officers and directors.  The settlement agreement provided for the payment by
the Dix Hills Group to the Company of the sum of $80,000.   In connection with
the settlement, in May, 1994, the Dix Hills Group returned to the Company, for
cancellation, all of the 4,592,000 post-split shares of common stock issued in
the reorganization, together with an additional 186,360 shares of common stock
owned by former management.   As a result of the settlement agreement, the Dix
Hills Group resigned as officers and directors of the Company, and present
management was appointed.

     In April, 2000, the Company changed its name to "Millennium Quest, Inc."
In February, 1999, the Company issued a total of 1,000,000 shares of
restricted common stock, to its officers, directors and two other
shareholders, in consideration of the efforts undertaken by these individuals
to accomplish the rescission, described above, and to reactivate the business
of the Company.

Business - General

     As indicated, the Company is seeking a business enterprise for
acquisition, reorganization or merger, or participation by the Company.  The
Company has not entered into any agreement, nor does it have any commitment or
understanding to enter into or become engaged in a transaction as of the date
of this filing.  The Company will investigate, review, and evaluate business
opportunities as they become available and will seek to acquire or become
engaged in business opportunities at such time as specific opportunities
warrant.

     It is anticipated that opportunities will be  made available to the
Company through its officers and directors and through professional advisors
including securities broker-dealers and through members of the financial
community.


                                2

     To a large extent, a decision to participate in a specific business
opportunity may be made upon management's analysis regarding the quality of
the other firm's management and personnel, the asset base of such firm or
enterprise, the anticipated acceptability of new products or marketing
concepts, the merit of the firms business plan, and numerous other factors
which are difficult, if not impossible, to analyze through the application of
any objective criteria.

     For the past few years, the Company has had no active business
operations.  In recent months, the Company has been seeking to acquire an
interest in a business with long-term growth potential.  The Company currently
has no commitment or arrangement to participate in a business and cannot now
predict what type of business it may enter into or acquire.  It is emphasized
that the business objectives discussed herein are extremely general and are
not intended to be restrictive on the discretion of the Company's management.
There are no plans or arrangements proposed or under consideration for the
issuance or sale of additional securities by the Company prior to the
identification of an acquisition candidate.  Consequently, management
anticipates that it may be able to participate in only one potential business
venture, due primarily to the Company's limited capital.  This lack of
diversification should be considered a substantial risk, because it will not
permit the Company to offset potential losses from one venture against gains
from another.

Selection of a Business

     The Company anticipates that businesses for possible acquisition will be
referred by various sources, including its officers and directors,
professional advisors, securities broker-dealers, venture capitalists, members
of the financial community, and others who may present unsolicited proposals.
The Company will not engage in any general solicitation or advertising for a
business opportunity, and will rely on personal contacts of its officers and
directors and their affiliates, as well as indirect associations between them
and other business and professional people.  By relying on "word of mouth,"
the Company may be limited in the number of potential acquisitions it can
identify.  While it is not presently anticipated that the Company will engage
unaffiliated professional firms specializing in business acquisitions or
reorganizations, such firms may be retained if management deems it in the best
interest of the Company.

     Compensation to a finder or business acquisition firm may take various
forms, including one-time cash payments, payments based on a percentage of
revenues or product sales volume, payments involving issuance of securities
(including those of the Company), or any combination of these or other
compensation arrangements.  Consequently, the Company is currently unable to
predict the cost of utilizing such services.  Management of the Company will
not be paid a finder's fee for locating a business opportunity.

      The Company will not restrict its search to any particular business,
industry, or geographical location, and management reserves the right to
evaluate and enter into any type of business in any location.  The Company may
participate in a newly organized business venture or a more established
company entering a new phase of growth or in need of additional capital to
overcome existing financial problems.  Participation in a new business venture
entails greater risks since in many instances management of such a venture
will not have proved its ability, the eventual market of such venture's
product or services will likely not be established, and the profitability of
the venture will be unproved and cannot be predicted accurately.  If the
Company participates in a more established firm with existing financial
problems, it may be subjected to

                                3
<PAGE>

risk because the financial resources of the Company may not be adequate to
eliminate or reverse the circumstances leading to such financial problems.

     In seeking a business venture, the decision of management will not be
controlled by an attempt to take advantage of any anticipated or perceived
appeal of a specific industry, management group, product, or industry, but
will be based on the business objective of seeking long-term capital
appreciation in the real value of the Company.  The Company will not acquire
or merge with a business or corporation in which the Company's officers,
directors, or promoters, or their affiliates or associates, have any direct or
indirect ownership interest.

     The analysis of new businesses will be undertaken by or under the
supervision of the officers and directors.  In analyzing prospective
businesses, management will consider, to the extent applicable, the available
technical, financial, and managerial resources; working capital and other
prospects for the future; the nature of present and expected competition; the
quality and experience of management services which may be available and the
depth of that management; the potential for further research, development, or
exploration; the potential for growth and expansion; the potential for profit;
the perceived public recognition or acceptance of products, services, or trade
or service marks; name identification; and other relevant factors.
The decision to participate in a specific business may be based on
management's analysis of the quality of the other firm's management and
personnel, the anticipated acceptability of new products or marketing
concepts, the merit of technological changes, and other factors which are
difficult, if not impossible, to analyze through any objective criteria.  It
is anticipated that the results of operations of a specific firm may not
necessarily be indicative of the potential for the future because of the
requirement to substantially shift marketing approaches, expand significantly,
change product emphasis, change or substantially augment management, and other
factors.

     The Company will analyze all available factors and make a determination
based on a composite of available facts, without reliance on any single
factor.  The period within which the Company may participate in a business
cannot be predicted and will depend on circumstances beyond the Company's
control, including the availability of businesses, the time required for the
Company to complete its investigation and analysis of prospective businesses,
the time required to prepare appropriate documents and agreements providing
for the Company's participation, and other circumstances.
Acquisition of a Business

     In implementing a structure for a particular business acquisition, the
Company may become a party to a merger, consolidation, or other reorganization
with another corporation or entity; joint venture; license; purchase and sale
of assets; or purchase and sale of stock, the exact nature of which cannot now
be predicted.  Notwithstanding the above, the Company does not intend to
participate in a business through the purchase of minority stock positions.
On the consummation of a transaction, it is likely that the present management
and shareholders of the Company will not be in control of the Company.  In
addition, a majority or all of the Company's directors may, as part of the
terms of the acquisition transaction, resign and be replaced by new directors
without a vote of the Company's shareholders.

     In connection with the Company's acquisition of a business, the present
shareholders of the Company, including officers and directors, may, as a
negotiated element of the acquisition, sell a portion or all of the Company's
Common Stock held by them at a significant premium over their original
investment in the Company.  As a result of such sales, affiliates of the
entity

                                4
<PAGE>

participating in the business reorganization with the Company would acquire a
higher percentage of equity ownership in the Company.  Management does not
intend to actively negotiate for or otherwise require the purchase of all or
any portion of its stock as a condition to or in connection with any proposed
merger or acquisition.  Although the Company's present shareholders did not
acquire their shares of Common Stock with a view towards any subsequent sale
in connection with a business reorganization, it is not unusual for affiliates
of the entity participating in the reorganization to negotiate to purchase
shares held by the present shareholders in order to reduce the amount of
shares held by persons no longer affiliated with the Company and thereby
reduce the potential adverse impact on the public market in the Company's
common stock that could result from substantial sales of such shares after the
business reorganization.  Public investors will not receive any portion of the
premium that may be paid in the foregoing circumstances.  Furthermore, the
Company's shareholders may not be afforded an opportunity to approve or
consent to any particular stock buy-out transaction.

     In the event sales of shares by present shareholders of the Company,
including officers and directors, is a negotiated element of a future
acquisition, a conflict of interest may arise because directors will be
negotiating for the acquisition on behalf of the Company and for sale of their
shares for their own respective accounts.  Where a business opportunity is
well suited for acquisition by the Company, but affiliates of the business
opportunity impose a condition that management sell their shares at a price
which is unacceptable to them, management may not sacrifice their financial
interest for the Company to complete the transaction.  Where the business
opportunity is not well suited, but the price offered management for their
shares is high, Management will be tempted to effect the acquisition to
realize a substantial gain on their shares in the Company.  Management does
not anticipate obtaining an independent appraisal to determine whether any
price that may be offered for their shares is fair.  Stockholders must rely,
instead, on the obligation of management to fulfill its fiduciary duty under
state law to act in the best interests of the Company and its stockholders.
However, the Company has adopted a policy for resolving the foregoing adopted
a resolution for the purpose of addressing potential conflicts of interest
between controlling shareholders and/or management and the other shareholders.
Under this policy, management and controlling shareholders are prohibited from
entering into any transaction which would be in their interests but be
contrary to the best interests of the minority shareholders.  While this
policy does not prohibit transactions which would result in a personal benefit
to management or controlling shareholders, the policy does require management
to more carefully evaluate a proposed transaction to determine that the
transaction is in the best interest of the Company.

     The officers and directors of the Company intend to conduct their
business in the best interests of all the shareholders.

     Under Delaware Law, the officers and directors of a corporation have a
fiduciary duty to a corporation and the stockholders of the corporation.  In
general, management of a Delaware corporation are held to two duties as
fiduciaries: (a) the duty of remaining loyalty to the interests of the
corporation, and (b) the duty of exercising due care.  The duty of loyalty is
the obligation of an officer or director to give primacy to the interests of
the corporation rather than personal concerns - to avoid self-dealing at the
corporation's expense.  An officer and director can be held personally liable
if it is found that he breached this duty by using his corporate position to
make a personal profit or for other personal gain.  The duty of care is the
obligation of an officer and director to exercise reasonable prudence - to
investigate and to deliberate adequately - in making business judgments for
the corporation or its stockholders.  These duties are owed personally by the
officers and directors of the Company, and the officers and directors, or each
of them, can be personally liable for any damages to the Company resulting
from a breach of such fiduciary duties.

                                5
<PAGE>


     It is anticipated that any securities issued in any such reorganization
would be issued in reliance on exemptions from registration under applicable
federal and state securities laws.  In some circumstances, however, as a
negotiated element of the transaction, the Company may agree to register such
securities either at the time the transaction is consummated, under certain
conditions, or at specified times thereafter.  Although the terms of such
registration rights and the number of securities, if any, which may be
registered cannot be predicted, it may be expected that registration of
securities by the Company in these circumstances would entail substantial
expense to the Company.  The issuance of substantial additional securities and
their potential sale into any trading market which may develop in the
Company's securities may have a depressive effect on such market.

     While the actual terms of a transaction to which the Company may be a
party cannot be predicted, it may be expected that the parties to the business
transaction will find it desirable to structure the acquisition as a so-called
"tax-free" event under sections 351 or 368(a) of the Internal Revenue Code of
1986, (the "Code").  In order to obtain tax-free treatment under section 351
of the Code, it would be necessary for the owners of the acquired business to
own 80% or more of the voting stock of the surviving entity.  In such event,
the shareholders of the Company would retain less than 20% of the issued and
outstanding shares of the surviving entity.  Section 368(a)(1) of the Code
provides for tax-free treatment of certain business reorganizations between
corporate entities where one corporation is merged with or acquires the
securities or assets of another corporation.  Generally, the Company will be
the acquiring corporation in such a business reorganization, and the tax-free
status of the transaction will not depend on the issuance of any specific
amount of the Company's voting securities.  It is not uncommon, however, that
as a negotiated element of a transaction completed in reliance on section 368,
the acquiring corporation issue securities in such an amount that the
shareholders of the acquired corporation will hold 50% or more of the voting
stock of the surviving entity.  Consequently, there is a substantial
possibility that the shareholders of the Company immediately prior to the
transaction would retain less than 50% of the issued and outstanding shares of
the surviving entity.  Therefore, regardless of the form of the business
acquisition, it may be anticipated that stockholders immediately prior to the
transaction will experience a significant reduction in their percentage of
ownership in the Company.

     Notwithstanding the fact that the Company is technically the acquiring
entity in the foregoing circumstances, generally accepted accounting
principles will ordinarily require that such transaction be accounted for as
if the Company had been acquired by the other entity owning the business and,
therefore, will not permit a write-up in the carrying value of the assets of
the other company.  The manner in which the Company participates in a business
will depend on the nature of the business, the respective needs and desires of
the Company and other parties, the management of the business, and the
relative negotiating strength of the Company and such other management.
The Company will participate in a business only after the negotiation and
execution of appropriate written agreements.  Although the terms of such
agreements cannot be predicted, generally such agreements will require
specific representations and warranties by all of the parties thereto, will
specify certain events of default, will detail the terms of closing and the
conditions which must be satisfied by each of the parties prior to such
closing, will outline the manner of bearing costs if the transaction is not
closed, will set forth remedies on default, and will include miscellaneous
other terms.

                                6
<PAGE>

Operation of Business After Acquisition

     The Company's operation following its acquisition of a business will be
dependent on the nature of the business and the interest acquired.  The
Company is unable to predict whether the Company will be in control of the
business or whether present management will be in control of the Company
following the acquisition.  It may be expected that the business will present
various risks, which cannot be predicted at the present time.
Governmental Regulation

     It is impossible to predict the government regulation, if any, to which
the Company may be subject until it has acquired an interest in a business.
The use of assets and/or conduct of businesses which the Company may acquire
could subject it to environmental, public health and safety, land use, trade,
or other governmental regulations and state or local taxation.  In selecting a
business in which to acquire an interest, management will endeavor to
ascertain, to the extent of the limited resources of the Company, the effects
of such government regulation on the prospective business of the Company.  In
certain circumstances, however, such as the acquisition of an interest in a
new or start-up business activity, it may not be possible to predict with any
degree of accuracy the impact of government regulation.  The inability to
ascertain the effect of government regulation on a prospective business
activity will make the acquisition of an interest in such business a higher
risk.

Competition

     The Company will be involved in intense competition with other business
entities, many of which will have a competitive edge over the Company by
virtue of their stronger financial resources and prior experience in business.
There is no assurance that the Company will be successful in obtaining
suitable investments.

Employees

     The Company is a development stage company and currently has no
employees.  Executive officers, who are not compensated for their time
contributed to the Company, will devote only such time to the affairs of the
Company as they deem appropriate, until such time as the Company enters into
active negotiations to acquire or reorganize with a business.  Management of
the Company expects to use consultants, attorneys, and accountants as
necessary, and does not anticipate a need to engage any full-time employees so
long as it is seeking and evaluating businesses.  The need for employees and
their availability will be addressed in connection with a decision whether or
not to acquire or participate in a specific business industry.  The officers
have received no cash compensation, but each were issued 350,000 shares of
common stock in February, 1999, for services rendered on behalf of the
Company.

Recent Developments

     Over the past year, the Company and its management have initiated efforts
to locate an attractive enterprise with which the Company may acquire or
become engaged in, or with which it may merge, or reorganize.  These efforts
include, but are not limited to, contacts with various professionals,
including professional advisors, securities broker-dealers, lawyers and
accountants, and other members of the financial community; and a preliminary
review of certain business opportunities, all of which have been declined by
the Company.

                                7
<PAGE>

      To date, as indicated above, the Company has not entered into any
transaction, and does not have any specific commitments or business
opportunities under review.  The Company is undertaking efforts to have its
stock quoted in the "pink sheets," in an attempt to establish a trading market
in the common stock.

     Management believes it has been unsuccessful to date in locating a
suitable business enterprise for acquisition, merger or reorganization due to
a number of factors, including the absence of a trading market for the
Company's securities; the very limited resources of the Company; a perceived
decline in "reverse acquisition" transactions in recent years; an increase in
regulatory requirements; the costs involved in connection with becoming a
publicly-owned company; and general economic and market conditions.
Management is hopeful that this situation will change at such time as it
obtains a pink sheet listing and market conditions improve; however, there is
no assurance that will occur.

                 ITEM 2.  DESCRIPTION OF PROPERTY

     The Company does not own any property.  The Company uses offices and
related clerical services at 4089 Mount Olympus Way, Salt Lake City, Utah
84124, provided by Terry Cononelos, the Secretary/Treasurer and a Director of
the Company, at no charge.

                    ITEM 3.  LEGAL PROCEEDINGS

     The Company is not a party to any material pending legal proceedings, and
to the best of its knowledge, no such proceedings by or against the Company
have been threatened.

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

     No matter was submitted to a vote of security holders, through the
solicitation of proxies or otherwise, during the fiscal year covered by this
report.

                             PART II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

     There is no established trading market for the common stock, and there
has not been a trading market in the Company's common stock for over ten (10)
years.  For the past several years, there have been no public transactions in
the common stock of the Company, to the best knowledge of the Company.   The
Company's common stock is not quoted on the OTC Bulletin Board, the "pink
sheets," or in any other quotation system.  The Company is undertaking efforts
to have its common stock quoted on the pink sheets; however, that has not been
accomplished to date, and there can be no assurance the Company will be
successful in accomplishing this objective.

     Since its inception, no dividends have been paid on the Company's common
stock.  The Company intends to retain any earnings for use in its business
activities, so it is not expected that any dividends on the common stock will
be declared and paid in the foreseeable future.

     At March 24, 2003, there were approximately 166 holders of record of the
Company's Common Stock.


                                8
<PAGE>


ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

Plan of Operation

     As of December 31, 2002, the Company had cash of $15,406, liabilities of
$2,253, and no other liquid assets or resources.

     At present, the Company does not have adequate capital to conduct any
significant operations.  The Company is engaged in the search for potential
business opportunities for acquisition or involvement with the Company, which
activities are severely limited by the Company's lack of resources.
Management believes that any business venture in which the Company becomes
involved will be made by issuing shares of the Company's authorized but
unissued common stock.  It is anticipated that the Company's liquidity,
capital resources and financial statements will be significantly different
subsequent to the consummation of any such transaction.

     The Company has very limited liquid assets, and such assets may not be
sufficient for the Company to meet its operating needs over the next twelve
months, if the Company becomes engaged in a specific business endeavor.  Until
the Company finds a business to acquire or to become engaged in, the Company
anticipates that it has sufficient capital through at least September 30,
2003.  This may change, however, if the Company is actively reviewing business
opportunities, with attendant travel and other costs, or other unforeseen
expenses are incurred.  If additional funds should become necessary for
operations, the Company may be required to seek funds privately from
shareholders and officers and directors.  However, there is no legal
obligation on the part of the officers, directors, or principal shareholders
to advance or supply funds to the Company.  Accordingly, the preservation of
the corporate entity cannot be assured.  In addition, the Company anticipates
that if it enters into an acquisition transaction in the next twelve months,
the surviving company may need additional capital for operations and expansion
efforts.  The Company will seek to enter into a business transaction with a
company which either has sufficient operating capital for a period of at least
one year, or which is capable of raising capital on terms favorable to the
successor company.  There is no assurance that the Company, or its successor,
will be able to raise private capital when needed, or on favorable terms. The
Company has no material revenues and its needs for capital will in all
likelihood change dramatically if it acquires an interest in a business
opportunity in the next twelve months.  The Company's current operating plan
is to (a) cover the administrative and reporting requirements of a public
company; and (b) search for, and investigate, potential businesses, products,
technologies and companies for acquisition.  At present, the Company has no
understandings, commitments or agreements with respect to the acquisition of
any business, product, technology or company, and there can be no assurance
that the Company will be able to identify any such business, product,
technology or entity suitable for an acquisition or reorganization
transaction.  Moreover, there can be no assurance the Company will be
successful in its efforts to enter into consummate an acquisition or
reorganization transaction on terms favorable or beneficial to the Company and
its shareholders, or that it, or its successor, will be able to effectively
manage the business opportunity the Company acquires or becomes engaged in.

     The Company is dependent upon management and/or its principal
shareholders to provide sufficient working capital to preserve the integrity
of the corporate entity during this phase, and until the Company is in a
position to enter into a business transaction, of which there can be no
assurance.  It is the intent of management and its principal shareholders to
provide sufficient working capital necessary to support and preserve the
integrity of the corporate entity.  However, if the Company is in need of
additional capital to enter into a business opportunity, the

                                9
<PAGE>

Company may not have sufficient capital, or be able to obtain sufficient
capital from management or its principal shareholders for such purpose.

Results of Operations

     The Company had essentially no operations during the fiscal year ended
December 31, 2002.

     The Company has had no revenue from continuing operations and incurred
expenses during the year ended December 31, 2002, of $7,568, in accounting,
legal and other general and administrative expenses in connection with the
Company's continuing efforts to file necessary periodic reports during the
fiscal year.  For the years ended December 31, 2002 and 2001, the Company has
incurred net losses of $7,425 and $8,434, respectively.

     As indicated, the Company will be dependent on management and its
principal shareholders to provide sufficient capital to preserve the integrity
of the corporate entity until the Company enters into a business enterprise.

                  ITEM 7.  FINANCIAL STATEMENTS

      The financial statements of the Company appear at the end of this report
beginning with the Index to Financial Statements on page 18.

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

      There have been no changes in or disagreements with accountants since
the Company's organization.

                             PART III
        ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS
AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

DIRECTORS AND OFFICERS

     The following table sets forth the names, ages, and positions with the
Company for each of the directors and officers of the Company.

Name                    Age   Positions(1)                        Since
----                    ----  ------------                        -----

Dimitri Cocorinis       48    President and Director               1994

Terry Cononelos         49    Secretary/Treasurer and Director     1994


     (1)  All executive officers are elected by the Board and hold office
until the next Annual Meeting of stockholders and until their successors are
elected and qualify.


                                10
<PAGE>

     The following is information on the business experience of each director
and officer.

     Dimitri Cocorinis, is the President and a director of the Company.  Mr.
Cocorinis has been a registered investment advisor for Wasatch Advisors, an
investment advisory firm, for over ten (10) years.  As an employee of Wasatch
Advisors, Mr. Cocorinis is a senior trader and a money manager of mutual funds
for institutional investors.  From approximately 1980 until his current
employment at Wasatch Advisors, Mr. Cocorinis was a real estate agent for
Sugarhouse Realty, a Salt Lake City based real estate company.  Mr. Cocorinis
received his bachelor of arts degree from the University of Utah in
philosophy.  He also has a liberal arts degree from Franklin College in
Lugano, Switzerland.

     Terry Cononelos, is the Secretary and a director of the Company.  Mr.
Cononelos has been a real estate agent with Chapman Richards, a Salt Lake City
real estate firm,  for the past eight years.  From 1980 until his current
position, he was a real estate agent at Sugarhouse Realty.  Mr. Cononelos
received his bachelor's degree in accounting from the University of Utah in
1977.

     Mr. Cocorinis and Mr. Cononelos are cousins.

OTHER SHELL COMPANY ACTIVITIES

     Neither of the officers and directors are involved in any other shell
corporations, as an officer, director or principal shareholder, and have not
had any such involvement for over ten (10) years.

COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

     To the best knowledge of the Company, there are no required reports that
have not been filed or have been filed untimely during the most recent fiscal
year ended December 31, 2002.

                 ITEM 10.  EXECUTIVE COMPENSATION

     During the past three fiscal years, no officer or director has received
any compensation from the Company.  The Company has no agreement or
understanding, express or implied, with any officer, director, or principal
stockholder, or their affiliates or associates, regarding employment with the
Company or compensation for services.  The Company has no plan, agreement, or
understanding, express or implied, with any officer, director, or principal
stockholder, or their affiliates or associates, regarding the issuance to such
persons of any shares of the Company's authorized and unissued common stock.
There is no understanding between the Company and any of its present
stockholders regarding the sale of a portion or all of the common stock
currently held by them in connection with any future participation by the
Company in a business.  There are no other plans, understandings, or
arrangements whereby any of the Company's officers, directors, or principal
stockholders, or any of their affiliates or associates, would receive funds,
stock, or other assets in connection with the Company's participation in a
business.  No advances have been made or contemplated by the Company to any of
its officers, directors, or principal stockholders, or any of their affiliates
or associates.

     There is no policy that prevents management from adopting a plan or
agreement in the future that would provide for cash or stock based
compensation for services rendered to the Company.

     On acquisition of a business, it is possible that current management will
resign and be replaced by persons associated with the business acquired,
particularly if the Company

                                11
<PAGE>

participates in a business by effecting a stock exchange, merger, or
consolidation as discussed under "BUSINESS." In the event that any member of
current management remains after effecting a business acquisition, that
member's time commitment and compensation will likely be adjusted based on the
nature and location of such business and the services required, which cannot
now be foreseen.

     In February, 1999, the Company granted to its officers and directors, and
two other shareholders, a total of 1,000,000 shares of restricted common
stock, for services rendered on behalf of the Company over the preceding
several years.  (See "ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED
TRANSACTIONS.")

                 ITEM 11.  SECURITY OWNERSHIP OF
             CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The following table sets forth as of the date of this report, the number
and percentage of the outstanding shares of common stock which, according to
the information supplied to the Company, were beneficially owned by (i) each
person who is currently a director of the Company, (ii) each executive
officer, (iii) all current directors and executive officers of the Company as
a group and (iv) each person who, to the knowledge of the Company, is the
beneficial owner of more than 5% of the outstanding common stock.  Except as
otherwise indicated, the persons named in the table have sole voting and
dispositive power with respect to all shares beneficially owned, subject to
community property laws where applicable.

                                                  Common        Percent
     Name and Address                             Shares        Of Class(1)
     ----------------                             ------------  ----------

     Officers and Directors:

     Dimitri Cocorinis(2)
     1346 East Harrison Avenue
     Salt Lake City, Utah 84105                   436,925       22.27

     Terry Cononelos(2)
     4089 Mount Olympus Way
     Salt Lake City, Utah 84124                   436,925       22.27

     All Executive officers and
     Directors as a Group (2 persons)             873,850       44.55

     Greater than 5% Beneficial Owners:

     Jack Coombs(2)
     2581 East 1300 South
     Salt Lake City, Utah 84108                   295,000       15.04


(1)  All shares are held of record and beneficially.

(2)  These individuals were issued a total of 950,000 shares of restricted
common stock in February, 1999, in consideration of services rendered to the
Company.  (See "ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS").


                                12
<PAGE>

     ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     In February, 1999, the Company issued a total of 1,000,000 shares of
restricted common stock to its two officers and directors, and to two other
shareholders for services rendered by these individuals over the preceding
several years in effecting a rescission of the transaction with Dix Hills,
described under "ITEM 1.  BUSINESS," and in undertaking efforts to bring the
Company current.  These shares were issued as follows: Terry Cononelos and
Dimitri Cocorinis (officers and directors) - 350,000 shares each; Jack Coombs
- 250,000 shares; and Jeff Helotes - 50,000 shares.   At the time of issuance
of these shares, and since the date of issuance, there has been no market for
the common stock of the Company.  These shares were issued in reliance upon
the exemption from registration set forth under Section 4(2) of the Securities
Act of 1933, as amended, and applicable exemptions in the state of Utah.
Except for the transaction described above, there are no proposed transactions
and no transactions during the past two years to which the Company was (or is)
a party, and in which any officer, director, or principal shareholder, or
their affiliates or associates, was also a party.

            ITEM 13.  EXHIBITS AND REPORTS ON FORM 8-K

     (a)    Exhibits.  Copies of the following documents are included as
exhibits to this report pursuant to Item 601 of Regulation S-B.

     SEC Ref. No.       Description/ Title of Document

         3.1*           Articles of Incorporation, as amended

         3.2*           Bylaws


*  Filed as Exhibit with corresponding number on Form 10-SB dated October 19,
2001.

     (b)    Reports on Form 8-K.  During the fiscal year ended December 31,
2002, the Company filed no reports on Form 8-K.


                ITEM 14.  CONTROLS AND PROCEDURES

     Evaluation of Disclosure Controls and Procedures.  Based upon an
evaluation under  supervision  and  with  the participation of our management,
as of a date within  90  days  of  the  filing date of this Annual Report on
form 10-KSB, our principal  executive officer and principal financial officer
have concluded that our  disclosure  controls  and  procedures  (as  defined
in Rules 13a-14(c) and 15d-14(c))  under  the  Securities Exchange Act of
1934, are effective to ensure that  information  required  to  be disclosed
(in reports that we file or submit under  that Exchange Act) is recorded,
processed, summarized and reported within the  time  periods  specified  in
SEC  rules  and  forms.

     Changes in Internal Accounting.  There were no significant changes in our
internal controls or other factors that could significantly affect these
controls subsequent to the date of their evaluation.  There were no
significant deficiencies or material weaknesses, and therefore there were no
corrective actions taken.  However, the design of any system of controls is
based in part upon the assumptions about the likelihood of future events, and
there is no certainty that any design will succeed in achieving its stated
goal under all potential future considerations, regardless of how remote.


                                13
<PAGE>

                            SIGNATURES

     In accordance with Section 13 or 15(d) of the Exchange Act, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.

                                  MILLENNIUM QUEST, INC.

Date: March 24, 2003              /s/  Dimitri Cocorinis
                                  -------------------------------------------
                                  By:  Dimitri Cocorinis
                                  Its: President, Chief Executive Officer
                                       and Director

Date: March 27, 2003              /s/  Terry Cononelos
                                  ------------------------------------------
                                  By:  Terry Cononelos
                                  Its: Chief Financial Officer,
                                       Secretary/Treasurer and Director

     In accordance with the Exchange Act, this report has been signed below by
the following persons on behalf of the registrant and in the capacities and on
the dates indicated.


Date: March 24, 2003              /s/  Dimitri Cocorinis
                                  ------------------------------------------
                                  By:  Dimitri Cocorinis
                                  Its: President, Chief Executive Officer
                                       and Director

Date: March 27, 2003              /s/  Terry Cononelos
                                  ------------------------------------------
                                  By:  Terry Cononelos
                                  Its: Chief Financial Officer,
                                       Secretary/Treasurer and Director



                                14

<PAGE>

                    CERTIFICATION PURSUANT TO
          18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO
          SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Dimitri Cocorinis, Chief Executive Officer, certify that:

1.    I have reviewed this annual report on Form 10-KSB of Millennium Quest,
Inc.;

2.    Based on my knowledge, this annual report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this annual report;

3.    Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this annual report;

4.    The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

   a.  designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities,
particularly during the period in which this annual report is being prepared;

   b.  evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this annual
report (the "Evaluation Date"); and

   c.  presented in this annual report our conclusions about the effectiveness
of the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;

5.    The registrant's other certifying officers and I have disclosed, based
on our most recent evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors (or persons performing the
equivalent functions):

   a.  all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and

   b.  any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal controls;
and

6.    The registrant's other certifying officers and I have indicated in this
annual report whether there were significant changes in internal controls or
in other factors that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any corrective actions
with regard to significant deficiencies and material weaknesses.


Date: March 24, 2003               /s/ Dimitri Cocorinis
                                   ------------------------------------------
                                   Dimitri Cocorinis, Chief Executive Officer

                                15
<PAGE>

                    CERTIFICATION PURSUANT TO
          18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO
          SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Terry Cononelos, Chief Financial Officer, certify that:

1.    I have reviewed this annual report on Form 10-KSB of Millennium Quest,
Inc.;

2.    Based on my knowledge, this annual report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this annual report;

3.    Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this annual report;

4.    The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

   a.  designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities,
particularly during the period in which this annual report is being prepared;

   b.  evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this annual
report (the "Evaluation Date"); and

   c.  presented in this annual report our conclusions about the effectiveness
of the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;

5.    The registrant's other certifying officers and I have disclosed, based
on our most recent evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors (or persons performing the
equivalent functions):

   a.  all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and

   b.  any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal controls;
and

6.    The registrant's other certifying officers and I have indicated in this
annual report whether there were significant changes in internal controls or
in other factors that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any corrective actions
with regard to significant deficiencies and material weaknesses.

Date: March 27, 2003               /s/ Terry Cononelos
                                   -----------------------------------------
                                   Terry Cononelos, Chief Financial Officer


                                16

<PAGE>

                    CERTIFICATION PURSUANT TO
          18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO
          SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

     In connection with the Annual Report of Millennium Quest, Inc. (the
"Company") on Form 10-KSB for the period ending December 31, 2002, as filed
with the Securities and Exchange Commission on the date hereof (the "Report"),
we, Dimitri Cocorinis and Terry Cononelos, Chief Executive Officer and Chief
Financial Officer of the Company, respectively, certify, pursuant to 18 U.S.C.
Section 1350, as adopted pursuant of Section 906 of the Sarbanes-Oxley Act of
2002, that, to the best of my knowledge and belief:

     (1)  The Report fully complies with the requirements of section 13(a) or
          15(d) of the Securities Exchange Act of 1934; and

     (2)  The information contained in the Report fairly presents, in all
          material respects, the financial condition and results of operations
          of the Company.


Date: March 24, 2003             /s/ Dimitri Cocorinis
                                 -------------------------------------------
                                 Dimitri Cocorinis, Chief Executive Officer


Date: March 27, 2003             /s/ Terry Cononelos
                                 -------------------------------------------
                                 Terry Cononelos, Chief Financial Officer




                                17
<PAGE>



                      MILLENNIUM QUEST, INC.
                   [A Development Stage Company]



                             CONTENTS

                                                                    PAGE

         -  Independent Auditors' Report                             19


         -  Balance Sheet, December 31, 2002                         20


         -  Statements of Operations, for the years
             ended December 31, 2002 and 2001
             and for the period from the re-entering
             of development stage on May 4, 1994
             through December 31, 2002                               21


        -   Statement of Stockholders' Equity, from
             the re-entering of development stage on
             May 4, 1994 through December 31, 2002                22-23


        -   Statements of Cash Flows, for the years
             ended December 31, 2002 and 2001
             and for the period from the re-entering
             of development stage on May 4, 1994
             through December 31, 2002                               24


        -   Notes to Financial Statements                          25-27



                                18
<PAGE>




                   INDEPENDENT AUDITORS' REPORT



Board of Directors
MILLENNIUM QUEST, INC.
Salt Lake City, Utah

We have audited the accompanying balance sheet of Millennium Quest, Inc. [a
development stage company] at December 31, 2002, and the related statements of
operations, stockholders' equity and cash flows for the years ended December
31, 2002 and 2001 and for the period from the re-entering of development stage
on May 4, 1994 through December 31, 2002.  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 audit.

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

In our opinion, the financial statements audited by us present fairly, in all
material respects, the financial position of Millennium Quest, Inc. [a
development stage company] as of December 31, 2002, and the results of its
operations and its cash flows for the years ended December 31, 2002 and 2001
and for the period from the re-entering of development stage on May 4, 1994
through December 31, 2002, in conformity with generally accepted accounting
principles in the United States of America.

The accompanying financial statements have been prepared assuming the Company
will continue as a going concern.  As discussed in Note 5 to the financial
statements, the Company has incurred losses since its inception and has no
on-going operations.  These factors raise substantial doubt about its ability
to continue as a going concern.  Management's plans in regards to these
matters are also described in Note 5.  The financial statements do not include
any adjustments that might result from the outcome of these uncertainties.



/S/ Pritchett, Siler & Hardy PC

PRITCHETT, SILER & HARDY, P.C.

February 20, 2003
Salt Lake City, Utah


                                19
<PAGE>

                      MILLENNIUM QUEST, INC.
                   [A Development Stage Company]

                          BALANCE SHEET


                              ASSETS

                                                                December 31,
                                                                    2002
                                                               -------------
CURRENT ASSETS:
   Cash                                                        $     15,406
                                                               -------------
     Total Current Assets                                            15,406
                                                               -------------
                                                               $     15,406
                                                               =============

               LIABILITIES AND STOCKHOLDERS' EQUITY


CURRENT LIABILITIES:
   Accounts payable                                            $      2,253
                                                               -------------
     Total Current Liabilities                                        2,253
                                                               -------------
STOCKHOLDERS' EQUITY:
   Preferred stock, $.001 par value,
     5,000,000 shares authorized, no
     shares issued and outstanding                                        -
   Common stock, $.001 par value,
     20,000,000 shares authorized,
     1,961,643 shares issued and
     outstanding                                                      1,962
   Capital in excess of par value                                   161,088
   Retained earnings (deficit)                                     (106,991)
   Deficit accumulated during the
     development stage                                              (42,906)
                                                               -------------

     Total Stockholders' Equity                                      13,153
                                                               -------------

                                                               $     15,406
                                                               =============





The accompanying notes are an integral part of this financial statement.

                                20

<PAGE>

                      MILLENNIUM QUEST, INC.
                   [A Development Stage Company]

                     STATEMENTS OF OPERATIONS

                                                               From the
                                                               re-entering of
                                             For the           Development
                                            Year Ended         Stage on May 4,
                                            December 31,       1994 Through
                                   --------------------------- December 31,
                                       2002           2001     2002
                                   ------------- ------------- -------------

REVENUE                            $          -  $          -  $          -
                                   ------------- ------------- -------------
OPERATING EXPENSES:
  General and administrative              7,568         9,078        51,830
                                   ------------- ------------- -------------

LOSS FROM OPERATIONS                     (7,568)       (9,078)      (51,830)
                                   ------------- ------------- -------------

OTHER INCOME:
  Interest and other income                 143           644         8,924
                                   ------------- ------------- -------------
   Total Other Income                       143           644         8,924
                                   ------------- ------------- -------------

LOSS BEFORE INCOME TAXES                 (7,425)       (8,434)      (42,906)

CURRENT TAX EXPENSE                           -             -             -

DEFERRED TAX EXPENSE                          -             -             -
                                   ------------- ------------- -------------
NET LOSS                           $     (7,425) $     (8,434) $    (42,906)
                                   ------------- ------------- -------------

LOSS PER COMMON SHARE              $       (.00) $       (.00) $       (.03)
                                   ------------- ------------- -------------




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

                                22
<PAGE>

                      MILLENNIUM QUEST, INC.
                   [A Development Stage Company]

                STATEMENT OF STOCKHOLDERS' EQUITY

     FROM THE RE-ENTERING OF DEVELOPMENT STAGE ON MAY 4, 1994

                    THROUGH DECEMBER 31, 2002

<TABLE>
<CAPTION>

                                                                                                   Deficit
                                                                                                   Accumulated
                                 Preferred Stock         Common Stock        Capital in Retained   During the
                              --------------------- ------------------------ Excess of  Earnings   Development Total
                              Shares     Amount     Shares        Amount     Par Value  (Deficit)  Stage       Equity
                              ---------- ---------- ------------- ---------- ---------- ---------- ----------- ----------
<S>                           <C>        <C>        <C>           <C>        <C>        <C>        <C>         <C>
BALANCE, May 4, 1994                  -  $       -     5,740,000  $   5,740  $ 147,310  $(106,991) $        -  $  46,059

Cancellation of shares for
 rescission of previous
 acquisition agreement,
 at $.001 per share, May
 1994                                 -          -    (4,778,360)    (4,778)     4,778          -           -          -

Other adjustments, rounding           -          -             3          -          -          -           -          -

Net loss for the year ended
 December 31, 1994                    -          -             -          -          -          -      (1,120)    (1,120)
                              ---------- ---------- ------------- ---------- ---------- ---------- ----------- ----------
BALANCE, December 31, 1994            -          -       961,643        962    152,088   (106,991)     (1,120)    44,939

Net loss for the year ended
  December 31, 1995                   -          -             -          -          -          -      (5,040)    (5,040)
                              ---------- ---------- ------------- ---------- ---------- ---------- ----------- ----------
BALANCE, December 31, 1995            -          -       961,643        962    152,088   (106,991)     (6,160)    39,899

Net income for the year ended
 December 31, 1996                    -          -             -          -          -          -         991        991
                              ---------- ---------- ------------- ---------- ---------- ---------- ----------- ----------
BALANCE, December 31, 1996            -          -       961,643        962    152,088   (106,991)     (5,169)    40,890

Net loss for the year ended
 December 31, 1997                    -          -             -          -          -          -        (976)      (976)
                              ---------- ---------- ------------- ---------- ---------- ---------- ----------- ----------
BALANCE, December 31, 1997            -          -       961,643        962    152,088   (106,991)     (6,145)    39,914

Net loss for the year ended
 December 31, 1998                    -          -             -          -          -          -        (761)      (761)
                              ---------- ---------- ------------- ---------- ---------- ---------- ----------- ----------
BALANCE, December 31, 1998            -          -       961,643        962    152,088   (106,991)     (6,906)    39,153

Shares issued for services
 rendered at $.01 per share,
 February 1999                        -          -     1,000,000      1,000      9,000          -           -     10,000

Net loss for the year ended
 December 31, 1999                    -          -             -          -          -          -     (15,932)   (15,932)
                              ---------- ---------- ------------- ---------- ---------- ---------- ----------- ----------
BALANCE, December 31, 1999            -          -     1,961,643      1,962    161,088   (106,991)    (22,838)    33,221

Net loss for the year ended
 December 31, 2000                    -          -             -          -          -          -      (4,209)    (4,209)



                                    [CONTINUED]
                                        22


</TABLE>
<PAGE>
<TABLE>
<CAPTION>

                              MILLENNIUM QUEST, INC.
                           [A Development Stage Company]

                         STATEMENT OF STOCKHOLDERS' EQUITY

             FROM THE RE-ENTERING OF DEVELOPMENT STAGE ON MAY 4, 1994

                             THROUGH DECEMBER 31, 2002

                                    [CONTINUED]


                                                                                                   Deficit
                                                                                                   Accumulated
                                 Preferred Stock         Common Stock        Capital in Retained   During the
                              --------------------- ------------------------ Excess of  Earnings   Development Total
                              Shares     Amount     Shares        Amount     Par Value  (Deficit)  Stage       Equity
                              ---------- ---------- ------------- ---------- ---------- ---------- ----------- ----------
<S>                           <C>        <C>        <C>           <C>        <C>        <C>        <C>         <C>
BALANCE, December 31, 2000            -          -     1,961,643      1,962    161,088   (106,991)    (27,047)    29,012

Net loss for the year ended
  December 31, 2001                   -          -             -          -         -           -      (8,434)    (8,434)
                              ---------- ---------- ------------- ---------- ---------- ---------- ----------- ----------

BALANCE, December 31, 2001            -          -     1,961,643      1,962    161,088   (106,991)    (35,481)    20,578

Net loss for the year ended
  December 31, 2002                   -          -             -          -          -          -      (7,425)    (7,425)
                              ---------- ---------- ------------- ---------- ---------- ---------- ----------- ----------

BALANCE, December 31, 2002            -  $       -     1,961,643  $   1,962  $ 161,088  $(106,991) $  (42,906) $  13,153
                              ========== ========== ============= ========== ========== ========== =========== ==========





     The accompanying notes are an integral part of this financial statement.


                                        23

</TABLE>
<PAGE>
<TABLE>
<CAPTION>







                          MILLENNIUM QUEST, INC.
                       [A Development Stage Company]

                         STATEMENTS OF CASH FLOWS

                                                                                   From the
                                                                                   re-entering of
                                                                 For the           Development
                                                                Year Ended         Stage on May 4,
                                                                December 31,       1994 Through
                                                       --------------------------- December 31,
                                                            2002         2001      2002
                                                       ------------- ------------- -------------
<S>                                                    <C>           <C>           <C>
Cash Flows from Operating Activities:
  Net Income (loss)                                    $     (7,425) $     (8,434) $    (42,906)
  Adjustments to reconcile net loss to net cash
   used by operating activities:
      Non-cash expenses                                           -             -        10,000
      Changes in assets and liabilities:
       Increase (decrease) in accounts payable               (7,524)        5,911         2,253
                                                       ------------- ------------- -------------
          Net Cash (Used) by Operating Activities           (14,949)       (2,523)      (30,653)
                                                       ------------- ------------- -------------

Cash Flows from Investing Activities                              -             -             -
                                                       ------------- ------------- -------------

          Net Cash (Used) by Investing Activities                 -             -             -
                                                       ------------- ------------- -------------

Cash Flows from Financing Activities                              -             -             -
                                                       ------------- ------------- -------------

          Net Cash (Used) by Financing Activities                 -             -             -
                                                       ------------- ------------- -------------
Net Increase (decrease) in cash                             (14,949)       (2,523)      (30,653)

Cash at Beginning of Period                                  30,355        32,878        46,059
                                                       ------------- ------------- -------------

Cash at End of Period                                  $     15,406  $     30,355  $     15,406
                                                       ============= ============= =============

Supplemental Disclosures of Cash Flow information:
 Cash paid during the period for:
   Interest                                            $          -  $          -  $          -
   Income taxes                                        $          -  $          -  $          -

Supplemental schedule of Noncash Investing and Financing Activities:
 From the re-entering of development stage on May 4, 1994 through December 31, 2002:
 None





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


                                    24
</TABLE>
<PAGE>

                      MILLENNIUM QUEST, INC.
                   [A Development Stage Company]

                  NOTES TO FINANCIAL STATEMENTS

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization - Millennium Quest, Inc. ("the Company") was organized under the
laws of the State of Delaware on February 4, 1986 as Teracom, Inc.  The name
was subsequently changed to Dix Hills Equities Group, Inc. in connection with
an acquisition of a subsidiary in December 1988.  As a result of a class
action lawsuit and settlement agreement a rescission of the acquisition was
completed during 1994.  During April 2000, the name of the Company was changed
to Millennium Quest, Inc.  The Company currently has no on-going operations
but is seeking potential business opportunities.  As a result of the
rescission agreement the Company is considered to have re-entered into the
development stage on May 4, 1994 and is currently considered a development
stage company as defined in Statement of Financial Accounting Standards No. 7.

Cash and Cash Equivalents - The Company considers all highly liquid debt
investments purchased with a maturity of three months or less to be cash
equivalents.

Income Taxes - The Company accounts for income taxes in accordance with
Statement of Financial Accounting Standards No. 109 "Accounting for Income
Taxes" which requires an asset/liability approach for the effect of income
taxes [See Note 4].

Loss Per Share - The computation of loss per share is based on the weighted
average number of shares outstanding during the period presented in accordance
with Statement of Financial Accounting Standards No. 128, "Earnings Per Share"
[See Note 6].

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

Recently Enacted Accounting Standards - Statement of Financial Accounting
Standards ("SFAS") No. 141, "Business Combinations", SFAS No. 142, "Goodwill
and Other Intangible Assets", SFAS No. 143, "Accounting for Asset Retirement
Obligations", SFAS No. 144, "Accounting for the Impairment or Disposal of
Long-Lived Assets", SFAS No. 145, "Rescission of FASB Statements No. 4, 44,
and 64, Amendment of FASB Statement No. 13, and Technical Corrections", SFAS
No. 146, "Accounting for Costs Associated with Exit or Disposal Activities",
SFAS No. 147, "Acquisitions of Certain Financial Institutions - an Amendment
of FASB Statements No. 72 and 144 and FASB Interpretation No. 9", and SFAS No.
148, "Accounting for Stock-Based Compensation - Transition and Disclosure - an
Amendment of FASB Statement No. 123", were recently issued.  SFAS No. 141,
142, 143, 144, 145, 146, 147 and 148 have no current applicability to the
Company or their effect on the financial statements would not have been
significant.

                                25
<PAGE>

                      MILLENNIUM QUEST, INC.
                   [A Development Stage Company]

                  NOTES TO FINANCIAL STATEMENTS

NOTE 2 - CAPITAL STOCK

Reduction of Authorized Shares - During March 2000, the Company amended its
Certificate of Incorporation to reduce its number of authorized common shares
by 180,000,000 shares and its authorized preferred shares by 5,000,000.  After
the amendment there were 20,000,000 common and 5,000,000 preferred shares
authorized.

Preferred Stock - The Company has 5,000,000 shares of preferred stock
authorized, $.001 par value with such rights, preferences and designations and
to be issued in such series as determined by the Board of Directors.  No
shares are issued and outstanding at December 31, 2002.

Common Stock - On May 4, 1994, shareholders returned 4,778,360 shares of
common stock for cancellation due to the rescission of the acquisition that
had occurred in 1988.  This resulted in a change in control of the Company and
resulted in the Company entering into a new development stage.

On February 26, 1999, the Company issued 1,000,000 shares of its previously
authorized, but unissued common stock for services rendered valued at $10,000
(or $.01 per share).

NOTE 3 - RELATED PARTY TRANSACTIONS

Management Compensation - During the years ended December 31, 2002 and 2001
the Company did not pay any compensation to its officers or directors.

Office Space - The Company has not had a need to rent office space.  An
officer/shareholder of the Company is allowing the Company to use his home as
a mailing address, as needed, at no expense to the Company.

NOTE 4 - INCOME TAXES

The Company accounts for income taxes in accordance with Statement of
Financial Accounting Standards No. 109 "Accounting for Income Taxes".  SFAS
No. 109 requires the Company to provide a net deferred tax asset/liability
equal to the expected future tax benefit/expense of temporary reporting
differences between book and tax accounting methods and any available
operating loss or tax credit carryforwards.  At December 31, 2002 the Company
has available unused operating loss carryforwards of approximately $129,000,
which may be applied against future taxable income and which expire in various
years through 2022.

                                26

<PAGE>


                      MILLENNIUM QUEST, INC.
                   [A Development Stage Company]

                  NOTES TO FINANCIAL STATEMENTS

NOTE 4 - INCOME TAXES [Continued]

The amount of and ultimate realization of the benefits from the operating loss
carryforwards for income tax purposes is dependent, in part, upon the tax laws
in effect, the future earnings of the Company, and other future events, the
effects of which cannot be determined.  Because of the uncertainty surrounding
the realization of the loss carryforwards, the Company has established a
valuation allowance equal to the tax effect of the loss carryforwards and,
therefore, no deferred tax asset has been recognized in the financial
statements for the loss carryforwards.  The net deferred tax assets are
approximately $19,400 and $18,300 as of December 31, 2002 and 2001,
respectively, with an offsetting valuation allowance of the same amount,
resulting in a change in the valuation allowance of approximately $1,100
during the year ended December 31, 2002.

NOTE 5 - GOING CONCERN

The accompanying financial statements have been prepared in conformity with
generally accepted accounting principles in the United States of America which
contemplate continuation of the Company as a going concern.  However, the
Company has incurred losses since its inception and has no on-going
operations.  These factors raise substantial doubt about the ability of the
Company to continue as a going concern.  In this regard, management is
proposing to raise additional funds through loans, or through additional sales
of its common stock or through the acquisition of other companies.  There is
no assurance that the Company will be successful in raising this additional
capital or in achieving profitable operations.  These financial statements do
not include any adjustments that might result from the outcome of these
uncertainties.

NOTE 6 - LOSS PER SHARE

The following data show the amounts used in computing loss per share for the
periods presented:


                                                               From the
                                                               re-entering of
                                             For the           Development
                                            Year Ended         Stage on May 4,
                                            December 31,       1994 Through
                                   --------------------------- December 31,
                                       2002           2001     2002
                                   ------------- ------------- -------------
 Loss from continuing operations
   available to common shareholders
  (numerator)                      $     (7,425) $     (8,434) $    (42,906)
                                   ------------- ------------- -------------
 Weighted average number of common
   shares outstanding used in loss
   per share for the period
  (denominator)                       1,961,643     1,961,643     1,406,158
                                   ------------- ------------- -------------

Dilutive loss per share was not presented, as the Company had no common stock
equivalent shares for all periods presented that would affect the computation
of diluted loss per share.



                                27