UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                   FORM 10-QSB

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

                  For the quarterly period ended June 30, 1997

                                       OR

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

                        For the Transition period from to

                         Commission file number 0-17874

                                  XPLORER, S.A.
             (Exact name of registrant as specified in its charter)

               Nevada                                          88-0199674
   ------------------------------                           ----------------
  (State or other jurisdiction of                           (I.R.S. Employer
incorporation or organization Number)                        Identification)


4750 Kelso Creek Road, Weldon, California                         93238
-----------------------------------------                       ---------
Address of principal executive offices)                         (Zip Code)

                    Phone: (619) 378-3936 Fax: (619) 378-1066
                    -----------------------------------------
              (Registrant's telephone number, including area code)

                     Gerant Industries, Inc.- March 31, 1997
                     ---------------------------------------
              (Former name, former address and former fiscal year,
                         if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days. Yes [X] No [ ]

Indicate  by check mark  whether  the  registrant  has filed all  documents  and
reports  required to be filed by Section 13 or 15(d) of the Securities  Exchange
Act of 1934 subsequent to the  distribution of securities under a plan confirmed
by a court. Yes [X] No [ ]

As of June 30, 1997,  there were  18,782,445  shares of common stock ($0.001 par
value) issued and outstanding.

Total sequentially numbered pages in this document:   17


                                        1

<PAGE>


                          PART I. FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

                                  Xplorer, S.A.
                        (A Development Stage Enterprise)
                           Consolidated Balance Sheet
                                  As of June 30
                                     Assets
                                                      1997            1996
                                                  ----------------------------
                                                   (Unaudited)    (Unaudited)
Current Assets:
  Cash                                                $39,756     Not
  Note receivable (Note 5)                                  0     Available
  Marketable securities (Note 4)                       30,261     For Prior
  Prepaid commissions                                 170,467     Period
                                                                  See Note 13
                                                   ---------------------------
Total Current Assets                                  240,484
Property, plant & equipment - net
  (Notes 2, 5)                                      3,528,089
Other investments (Notes 7 and 11)                  1,019,000

                                                  ----------------------------
          Total Assets                             $4,787,573
                                                  ============================
       Liabilities and Shareholder Equity
                   Liabilities:
Current Liabilities:
  Gold contracts ( Note 12)                            94,438
  Zero-coupon bonds - Current                         887,609
  Related party payable (Note 11)                     208,017
  Note payable (Notes 5 and 11)                       450,000
  Payroll obligations                                  10,248
  Other accrued expenses                               21,738

                                                  ----------------------------
                                                    1,672,050
  Accrued legal fees (Note 8)                          86,897
  Long-term zero coupon bonds                         855,403
  Minority interest in consolidated
    subsidiary (Note 8)                               852,000
                                                  ----------------------------
                                                    3,466,350
                                                  ----------------------------
Commitments and contingencies
(Notes 2, 9, 11, & 12)


  THE NOTES TO THE FINANCIAL STATEMENTS ARE AN INTEGRAL PART OF THIS STATEMENT


                                       2
<PAGE>


                                  Xplorer, S.A.
                        (A Development Stage Enterprise)
                     Consolidated Balance Sheet (Continued)
                                  As of June 30

                                                      1997            1996
                                                  ----------------------------
                                                   (Unaudited)    (Unaudited)


              Shareholders' Equity (Note 7):
  Preferred Stock, par value $0.001,                    1,300
    authorized 1,250,600 shares;       
    convertible beginning in 2006; 1,250,600
    shares issued and outstanding.

  Common Stock, $0.0001 par value, authorized
    sixty million (60,000,000) shares;
    18,782,455 shares issued and outstanding.          18,782
  Additional paid in capital                        2,546,000
  Deficit accumulated during the development
    stage                                          (1,244,859)
                                                  ----------------------------
Total Shareholders' Equity                          1,321,223
                                                  ----------------------------
Total Liabilities and Shareholders' Equity         $4,787,573
                                                  ============================

  THE NOTES TO THE FINANCIAL STATEMENTS ARE AN INTEGRAL PART OF THIS STATEMENT


                                       3

<PAGE>


                 Xplorer, S.A. (A Development Stage Enterprise)
                        Unaudited Statement of Operations
                     For The Six Month Period Ended June 30

                                           1997                    1996
                                  ---------------------------------------------
                                   Quarter      Year To     Quarter    Year To
                                                 Date                   Date
                                  ---------------------------------------------

Income:                                                     Not Available
                                                            For Prior Periods
Revenues (Note 1)                         $0          $0    See Note 13
Other income (expense)               $10,000      65,020
                                  ---------------------------------------------
          Total Income                10,000      65,020
                                  ---------------------------------------------

Cost of Sales:
                                           0           0
                                           0           0
                                  ---------------------------------------------
          Total Cost of sales              0           0
                                  ---------------------------------------------
          Gross margin (Loss)         10,000      65,020
                                  ---------------------------------------------
Operating Expenses:
Compensation                          51,687      95,453
Professional fees                      1,351      74,719
Commissions                                0           0
Interest                              11,250      18,750
Administrative                       205,233     216,957
Depreciation                               0           0
                                  ---------------------------------------------
Total Operating expenses             269,521     405,879
                                  ---------------------------------------------

                                  ---------------------------------------------
       Net Profit (Loss)           ($259,521)   (340,859)
                                  =============================================

Earnings (Loss) per
Share of Common Stock and 
Common Stock Equivalents             ($0.014)    ($0.018)
                                  =============================================
Common Stock outstanding          18,782,445  18,782,445
                                  =============================================

  THE NOTES TO THE FINANCIAL STATEMENTS ARE AN INTEGRAL PART OF THIS STATEMENT


                                        4

<PAGE>


                 Xplorer, S.A. (A Development Stage Enterprise)
                        UNAUDITED STATEMENT OF CASH FLOWS
                     For the Six Month Period Ended June 30

          CASH FLOWS FROM OPERATING ACTIVITIES           1997        1996
                                                      ----------------------
Net (Loss)                                            ($340,859)   Not
Adjustments to Reconcile Net Income to                             available
     Net Cash Used in Operating Activities:                        for Prior
      Eliminate Non Cash Items (Depreciation and                   Periods
      Amortization)
(Increase) Decrease in:                                            See Note
                                                                   13 for
     Receivables                                         16,000    details
     Marketable securities                              196,139
     Prepaid commissions                                 39,533
Increase (Decrease) in:
     Gold contracts                                    (178,562)
     Zero coupon bonds                                  (27,391)
     Related party payable                               59,017
     Accrued expenses and payroll obligations            (9,214)
     Accrued legal fees                                 (60,103)
     Long term zero coupon bonds                        302,703

           NET CASH PROVIDED BY (USED IN)             ----------------------
               OPERATING ACTIVITIES                      (2,737)
                                                      ----------------------
       CASH FLOWS FROM INVESTING ACTIVITIES
Increase (Decrease) in:
     Costs added to property, plant & equipment        (123,689)
     Notes payable
     Stock issued for equity conversion:
     Common stock                                           182
     Paid in capital                                          0
     Minority Interest in company activities                  0

          NET CASH PROVIDED BY (USED IN)              ----------------------
               FINANCING ACTIVITIES                    (123,507)
                                                      ----------------------
NET INCREASE (DECREASE) IN CASH                        (126,244)
CASH, at Beginning of Period                            166,000
                                                      ----------------------
CASH, at End of Period                                  $39,756
                                                      ======================

  THE NOTES TO THE FINANCIAL STATEMENTS ARE AN INTEGRAL PART OF THIS STATEMENT

   
                                       5

<PAGE>


                 Xplorer, S.A. (A Development Stage Enterprise)
         UNAUDITED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (Note 8)
                  For the Six Month Period Ended June 30, 1997

                                                                  
<TABLE>
<CAPTION>
                                   Common Stock           Preferred Stock      Additional     
                             ----------------------------------------------     Paid In       Retained
                               Shares         Amount      Shares     Amount     Capital       Earnings       Total
                             ----------------------------------------------------------------------------------------
<S>                          <C>             <C>         <C>         <C>      <C>          <C>             <C>       
Balance per audit,           18,554,000      $18,600     1,280,550   $1,300   $2,546,000     ($904,000)    $1,661,900
December 31, 1996

Entries For Quarter
Ending March 31, 1997

Adjustments to year end         228,445          182                                                             $182

Profit (loss) for period                                                                       (81,338)     (81,338)

                             ----------------------------------------------------------------------------------------  
BALANCE, March 31, 1997      18,782,445      $18,782     1,280,550   $1,300   $2,546,000     ($985,338)    $1,580,744
                             ----------------------------------------------------------------------------------------             

Entries For Quarter
Ending June 30, 1997



Profit (Loss) for period                                                                      (259,521)     ($259,521)
                             ----------------------------------------------------------------------------------------             
Balance, June 30, 1997       18,782,445      $18,782     1,280,550   $1,300   $2,546,000   ($1,244,859)    $1,321,223
                             ========================================================================================       
</TABLE>


  THE NOTES TO THE FINANCIAL STATEMENTS ARE AN INTEGRAL PART OF THIS STATEMENT


                                       6

<PAGE>


      NOTES TO XPLORER, S.A. CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                     Three Month Period Ended June 30, 1997

Note 1   Organization and Presentation:

         Xplorer,  S. A., the "Company"  (successor to Gerant Industries,  Inc.)
         was  organized  by  adoption  of  amended  and  restated   Articles  of
         Incorporation  dated  July 5, 1996  which were filed with the office of
         the Secretary of State of Nevada on August 15, 1996.

         Gerant Industries,  Inc. ("Gerant") filed a petition for reorganization
         under  Chapter 11 of the United States  Bankruptcy  Court ("the Court")
         for the Central  District of  California  on March 1, 1994. On July 24,
         1996 the Court confirmed  Gerant's Third Amended Plan of Reorganization
         (the "Plan"). The Plan approved the amendment of the of the Articles of
         Incorporation and By-Laws,  change of corporate name,  authorization of
         common and preferred shares of stock, payment of claims and issuance of
         stock by the successors to this  debtor-in-possession,  Xplorer,  S. A.
         The  Company  was to  issue  16,500,000  shares  of  common  stock  and
         1,043,000  shares of preferred  stock which were valued in aggregate at
         $53  Million  by  the  Court.  The  historical  determinable  value  in
         accordance with generally accepted accounting principles was $2,011,200
         and   the    Company    accounted    for   the    transaction    as   a
         quasi-reorganization.

         The Company is a development  stage enterprise and has not achieved its
         intended operations or related revenue as of this date.

         The Company, a  development  stage  enterprise,  anticipates  obtaining
         sufficient   cash  resources  in  1997  from  the  sale  of  investment
         contracts, warrant exercise, operations, or private placement of equity
         securities.  Such  proceeds  are  necessary  to assure  the  funding of
         anticipated  operating costs and  satisfaction of any negative  working
         capital as of the current period.

         Presentation

         The Company  intends to engage in the  development of natural  resource
         properties. As of June 30, 1997 the Company does not have any operating
         properties and is a development stage enterprise owning 59% of Atlantic
         Pacific Trust, L.L.C. and its wholly-owned subsidiary  Atlantic-Pacific
         Finanzprodukte,  GmbH as of June 30, 1997. The accounts of this entity,
         which has made  loans to its  parent are  included  in these  financial
         statements and all  significant  inter-company  transactions  have been
         eliminated.  The loans have been  converted to common stock or units of
         the Company (Note 8).


                                        7

<PAGE>


      NOTES TO XPLORER, S.A. CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                     Three Month Period Ended June 30, 1997

         Gerant,  the  predecessor  Company,  had net  assets  of  approximately
         $52,000 (Note 3) and  insignificant  operations from January 1, 1994 to
         August 15, 1996. The quasi-  reorganization  of this entity resulted in
         retained earnings of $0 as of January 1, 1996.

Note 2   Summary of Significant Accounting Policies:

         MINING PROPERTIES:
         Mining  properties are reflected in property,  plant,  and equipment at
         cost of acquisition  and  development.  Costs include efforts to remove
         ore and waste, exploration,  development of new ore bodies and defining
         further mineralization in existing ore bodies. These costs are deferred
         and  will  be  charged  to  operation   costs   utilizing  the  unit-of
         -production method in the period in which commercial production occurs.

         When a property is  identified  as having  development  potential,  the
         costs of engineering,  contract labor, financing, and professional fees
         related to  development  are  capitalized  as they are  incurred.  If a
         project is determined not to be  economically  feasible,  unrecoverable
         costs  are  expensed  in the year in which the  determination  is made.
         Mining  properties are reflected at net  realizable  value based on the
         Company's ability to generate future value.

         REVENUE RECOGNITION:
         Revenue is recognized  when title to delivered  gold or other  precious
         metals passes to the buyer.

         REPORTING CURRENCY:
         While the Company has significant financing transactions denominated in
         German  currency,  its operations are located in the U.S.  Accordingly,
         all financial  information  regarding these  transactions is translated
         into U.S.  dollars and no material  transaction  effect exists at March
         31, 1997.


                                        8

<PAGE>


      NOTES TO XPLORER, S.A. CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                     Three Month Period Ended June 30, 1997


         LOSS PER SHARE:
         The loss per share is calculated  using the weighted  average number of
         shares outstanding.  Warrants outstanding are anti-dilutive and are not
         included.

         PROPERTY,  PLANT & EQUIPMENT AND  DEPRECIATION:
         All property,  plant & equipment is stated at cost and depreciated on a
         straight-line   basis  over  individual  useful  lives  -  three  years
         (computers),  five years (mining  equipment),  and  units-of-production
         once mining property is at the operational level.

         FINANCIAL UNCERTAINTIES:
         The Company is in the development  stage and has experienced a net loss
         of  $.  The  loss  is  principally  due  to  commissions  and  interest
         associated with the 1996 German  financing.  There is no assurance that
         commercial quantities of mineral resources can be developed and sold in
         a  profitable  market.  Also,  mining  production  could be delayed and
         uninsurable risks could be incurred (see Note 9).

         The  Company's  profitability  is subject to change in gold  prices and
         exchange rates. To reduce the impact of such changes, the Company locks
         in  the  future  value  of  certain  of  these  items  through  hedging
         transactions.  These  transactions are accomplished  through the use of
         financial instruments,  the value of which is derived from movements in
         the  underlying  gold  prices,  the  Company's  actual  production,  or
         exchange rates.

         The Company  intends to engage in financial  instruments  to reduce the
         financial  impact caused by  fluctuations  in the exchange rate of U.S.
         dollars to German Deutsche Mark liabilities.

         The carrying values of investment  contracts  involving gold settlement
         are  re-measured  using the market  value of gold at the balance  sheet
         date ($369 per troy ounce).  The price of gold fluctuates  daily,  thus
         the values used herein may fluctuate subsequent to the date hereof.

                                        9

<PAGE>


      NOTES TO XPLORER, S.A. CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                     Three Month Period Ended June 30, 1997

         INCOME TAXES:
         Xplorer,  S.A.  and its  predecessor  company  have a  substantial  net
         operating  loss of an  uncertain  amount as of the date of this report.
         Prior years tax returns are now in the process of being prepared.

         COMMON STOCK ISSUANCE:
         Shares issued to Gerant special creditors, employees,  consultants, and
         preferred shareholder of the Company are valued at the nominal value of
         $0.10 per share.  Common  stock Units  include one share of stock and a
         warrant to acquire an additional share at 70% of market value.

         USE OF ESTIMATES:
         The  preparation of financial  statements in conformity  with generally
         accepted  accounting  principles  requires management to make estimates
         and  assumptions  that  affect  the  reported  amounts  of  assets  and
         liabilities  at the date of the financial  statements  and the reported
         amounts of revenues and expenses  during the reporting  period.  Actual
         results could differ from those estimates.

Note 3   Quasi-Reorganization:

         Gerant  changed  its  corporate  name to Xplorer,  S.A.  pursuant to an
         exchange of stock and the provisions outlined in the Plan.

         The  Gerant's  balance  sheet  prior to the  execution  of the Plan and
         reorganization  with  newly-formed  Xplorer  S.A.  was as stated in the
         Company's 10 KSB as of December 31, 1996.

         Under the Plan,  the  Company  would  realize  the assets of Gerant and
         assume the liabilities at Gerant basis,  and issue common and preferred
         stock in exchange for  1,005,000  units of Atlantic  equity held by the
         Company.   Such  units  had  a  nominal  book  value  of  $1.50.  These
         transactions  created a  valuation  for the  Company's  new  common and
         preferred stock issuance of $2,011,200.

Note 4   Marketable Securities:

         The Company  maintains an interest in marketable  equity  securities as
         part of its hedge program. These securities are reflected appropriately
         in the marketable securities section of the balance sheet. The realized
         gains or losses are  reflected  in the  Statement of  Operations  under
         other income and expense.


                                       10

<PAGE>


      NOTES TO XPLORER, S.A. CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                     Three Month Period Ended June 30, 1997


         The  Company  does  not  use  derivatives   financial  instruments  for
         speculative  purposes.  The Company enters into gold equity investments
         to manage  exposure to changes in a rising gold price and the Company's
         undelivered commitments.

Note 5   Property, Plant and Equipment:

         The values  reflected  in the 10 KSB of  December  31, 1996 are carried
         forward here and are  adjusted by any  additions or deletions as of the
         current  period.  These values are at the defined  cost of  $3,696,184,
         with  accumulated  depreciation of $181,900,  with the net reflected on
         the balance sheet.

         The  Company's  majority-owned  subsidiary  (Note 8) owns eight  claims
         known as the Evening Star Mine located in Piute Mountain,  Kern County,
         California.  Most of the  development  costs for Evening Star Mines are
         from related parties (Note 13).

Note 6   Other Investments:

         The  Company  holds a  $500,000  full  recourse  promissory  note at 8%
         interest per annum,  payable monthly and principal due August 18, 1997.
         This note is secured by 500,000  Class C Units of United  Reality Group
         Limited  Partnership  redeemable  by issuer at $1.00 per unit in August
         1997 and 75% tenant in common  interest  in the net  proceeds  from the
         Southwood  Plaza  Shopping  Center in Charlotte,  North  Carolina.  The
         property presently generates positive cash flow.  However,  the Company
         has  elected  not to reflect a $400,000  non-recourse  promissory  note
         secured  only by 400,000  units of United  Reality  Group  Partnership.
         Interest on the $500,000  note of $3,333 has been received on a monthly
         basis continuously.

         Atlantic  owns  100% of the  common  stock  of a  company  that has two
         investments in commercial property located in Bakersfield,  California.
         The net  realizable  value of this  investment  is  $500,000  as of the
         current date.

                                       11

<PAGE>


      NOTES TO XPLORER, S.A. CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                     Three Month Period Ended June 30, 1997

         Atlantic owns 406,000  shares of Xplorer S.A. of which  218,218  shares
         are  committed  to German  contract  holders who are  exchanging  their
         contracts  for  stock  of  Xplorer  that is  owned  by  Atlantic.  This
         investment is 59% eliminated in consolidated  financial  statements and
         reflected at a nominal value of $0.10 per share of $19,000.

Note 7   Atlantic Pacific Trust, L.L.C.:

         Atlantic Pacific Trust, L.L.C. ("Atlantic"), a Nevada limited liability
         company,  is a natural  resource  company owned by Xplorer and three of
         the Company's shareholders (the "Minority Interest").  Such corporation
         is the  successor to Atlantic  Pacific  Trust  ("APT") and is the legal
         owner of certain mining properties located in Kern County, California.

         These mining properties  (approximately 117 mining claims) were held by
         a trust controlled by William M. Moreland ("Moreland"), and transferred
         to a new entity, North Star Industries  ("North").  North was 30% owned
         by Moreland, 30% owned by Gardner, and 40% owned by Compania Comerciale
         Atlantis,   S.A.,  a  Costa  Rican  entity  ("CCA").  The  claims  were
         eventually  divided into four  separate  trusts.  One of these  trusts,
         Nevada  Trust,  which owned eight  claims  known as the  "Evening  Star
         Mine", was acquired at cost by APT.

         APT was funded by sale of investment contracts,  precious metal forward
         contracts,  and equity units  ("LLC").  The Company owns  1,254,960 LLC
         units as of the current date (59%).

         APT made a loan to the  Company  for  $355,000  that was  converted  to
         Company  special units (one share of common stock and one B warrant and
         C warrant  each  exercisable  within  five years at $2.00 and $3.00 per
         share, respectively and paid a Gerant creditor $110,000 in exchange for
         111, 667 shares of the Company's common stock. These funds were used by
         the  Company  to pay Gerant  creditors  according  to the Plan.  At the
         current  date the value of 275,334  shares  (59% of  466,667)  has been
         eliminated upon consolidation.

         The  Plan  provided  that  Compania  Comerciale  Atlantis,  S.A.  would
         exchange 500,000 of its LLC units for 1,250,000 preferred shares of the
         Company.  However,  only 417,200  units were  exchanged  for  1,043,000
         preferred  shares und this Plan.  In December  1996,  CCA did  exchange
         189,960 units for an additional  237,550 shares of preferred stock. The
         preferred stock is partially  convertible to ten shares of common stock
         at the end of six years and has a dividend  of 1.00% per month  payable
         in common stock at time of conversion.  In December 1996, the preferred
         stockholder  agreed to waive all present and future preferred  dividend
         rights for the  immediate  issuance of 1,000,000  common  shares of the
         Company.


                                       12

<PAGE>


      NOTES TO XPLORER, S.A. CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                     Three Month Period Ended June 30, 1997


         The  Plan  also  provided  that  585,560  LLC  units  held by  Atlantic
         beneficiaries Be exchanged for Debtor Notes and converted to 14,639,000
         shares of common stock. In addition, the former Gerant shareholders had
         a reverse split to 400,000 common stock Units.  All of these Units have
         not as yet been issued.

Note 8   Accrued Legal Fees:

         Per the Plan,  Atlantic agreed to purchase an estimated  $257,000 legal
         fee administrative claim of the law firm, Robinson,  Diamant,  Brill, &
         Klausner (the "Firm"). Upon purchase,  Atlantic intends to exchange the
         claim for 257,000 Xplorer common stock special units.  This transaction
         is still in progress  and is  anticipated  to be  completed  during the
         calendar year 1997.

Note 9   Note Payable:

         In  September,   1996  the  Company  borrowed   $450,000  from  Gardner
         Investments.  The  terms of the  note  are  10.00%  per  annum  payable
         monthly.  The principal is due and payable on September 25, 1997 and is
         secured by 500,000 Class C Units of United Realty Group,  L.P. The note
         is  convertible,  at the option of the holder,  at any time for 150,000
         shares of common stock of the Company.

Note 10  Investment Contracts Payable:

         Atlantic has issued investment contracts under German
         securities laws.  Such contracts are four types:

         a)     Contract  of  $9,645  per  kilo  received  in U.S.  dollars  for
                purchase  of  undelivered  kilos  (32.15  troy  ounces)  of gold
                bullion. All contracts have a one year maturity.  As of June 30,
                1996, the balance owed is $99,437.  The Company has covered it's
                gold risk on  outstanding  contracts  up to $369 per ounce.  The
                Company has paid off $128,823 of these contracts in 1997.


                                       13

<PAGE>


      NOTES TO XPLORER, S.A. CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                     Three Month Period Ended June 30, 1997


         b)     Zero-coupon  contract  of $12,500  payable in U.S.  dollars  and
                bearing  interest  at  9.00%  per  annum.   Such  contracts  are
                repayable with related interest in one to five years. As of June
                30, 1997 the balance is $87,500 and interest  expense of $29,132
                has been  accreted.  The  Company  has paid off $50,000 of these
                contracts in 1997.

         c)     Zero-coupon  contract  payable in 5,000  German  Deutsche  Marks
                ("DM")  units and  bearing  interest  at 9.00% per  annum.  Such
                contracts  are repayable  with related  interest in DM in one to
                five years.  The  balance as of June 30,  1997 is  $390,455  and
                interest  expense of $24,458 has been accreted.  The Company has
                paid off  $296,223  in 1997 with  218,218  shares of the Company
                common stock owned by Atlantic.

         d)     Zero-coupon contract payable in DM or gold at the rate of 600 DM
                principal  per 1 troy ounce of gold did not result in funding to
                the  Company  until  January  1997.  This  is the  only  type of
                contract  that  will be  offered  in the  future.  To date  from
                January 1, 1997 to June 30,  1997 the  Company  raised  $328,338
                from  these  contracts.  No  payments  have  been  due on  these
                contracts in 1997.

         All bonds are secured by the  Company's  interest  in the Evening  Star
         mining claims per assignment to a bond trustee.

         The Company paid commissions of approximately 33% and raised $1,375,000
         in net funds during 1996.

                Investment contracts are due as follows:
                           1997                             $610,893
                           1998                              458,261
                           1999                              211,824
                           2000                               82,419
                           2001                              300,909
                           2002                               78,706
                                                          ----------
                           Total                          $1,743,012
                                                          ----------


                                       14

<PAGE>


      NOTES TO XPLORER, S.A. CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                     Three Month Period Ended June 30, 1997


Note 11  Related Party Payable:

         In 1995, Atlantic entered into agreements with Sequoia Trust, a related
         party,  to lease surface and mineral rights related to 57 acres of land
         adjacent to Evening Star Mine and certain  improved real property known
         as the Weldon Research Center for total cost of $6,000 per month. These
         lease are renewable after a five year term and require a future minimum
         annual payment of $72,000 to Sequoia Trust.  Total charges  capitalized
         to development during 1996 were $104,000.

         These  properties  provide the Company with the  opportunity to develop
         three patented  mining claims with probable  commercial  grade ore (12%
         royalty  due to Sequoia  Trust),  construct  a primary  ore  processing
         refinery,  and utilize 13,000 square feet at the Weldon Research Center
         for its mineralization analyzes and other testing procedures.

         Atlantic  also has a cancellable  contract with EMTEC,  Inc., a related
         party,  for  development  of the  eleven  mining  claims and the future
         operation of the mine and refinery.  The contract  requires the Company
         to pat EMTEC  bi-monthly  at  invoiced  cost plus 18%  overhead.  Total
         charges capitalized to development to date are.

         As of March 31, 1997 the Company owes these entities  $147,000 for past
         services and such amount is accrued into development  costs for evening
         Star Mine (See Note 6).

Note 12  New Accounting Pronouncements:

         Statement of Financial  Accounting  Standards No. 121,  "Accounting for
         the  Impairment  of  Long-Lived  Assets to be  Disposed  Of" (SFAS 121)
         requires that  long-lived  assets be reviewed for  impairment  whenever
         changes in circumstances  indicate that the carrying amount of an asset
         may not be recoverable.  The adoption of this statement as of March 31,
         1997 had no material effect on the consolidated financial statements.

         Statement of Financial  Accounting  Standards Nos. 123. "Accounting for
         Stock-Based  Compensation" (SFAS 123) establishes  financial accounting
         and reporting standards for stock-based employee  compensation plans as
         well as transactions in which an entity issues it's equity  instruments
         to acquire  goods or  services  from  non-employees.  However,  it also
         allows an entity to continue to measure  compensation cost based on APB
         Opinion No. 25, "Accounting for Stock Issued to Employees". The Company
         has determined that the fair value of stock  transactions is similar to
         the issue price at the time of granting and accordingly, has elected to
         continue to apply the intrinsic value based method.



                                       15

<PAGE>


      NOTES TO XPLORER, S.A. CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                     Three Month Period Ended June 30, 1997


         In June,  1996,  Statement of Financial  Accounting  Standards No. 125,
         "Accounting  for  Transfers  and  Servicing  of  Financial  Assets  and
         Extinguishment   of  Liabilities"   (SFAS  No.  125),   which  provides
         accounting  and  reporting  standards  for  transfers  and servicing of
         financial  assets and  extinguishment  of liabilities  occurring  after
         December  31,  1996 was  issued.  The  adopting  of SFAS No. 125 is not
         expected to have any impact on the financial statements of the Company.

Note 13  Comparative Financial Statements

         Comparative  financial  data  for  similar  periods  in  1996  are  not
         available.  The  predecessor  Company,  Gerant,  was  in a  Chapter  11
         Proceedings,  which was confirmed as indicated  above,  and during this
         process had little or no operations.  Any  presentation  of the numbers
         during that period would cause the reader to have a distorted view from
         a comparative  standpoint.  This will continue until the fourth quarter
         of this year, when Comparative Balance Sheets will commence.


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

For the three months ended June 30, 1997:

FINANCIAL CONDITION:
         The Company's  working capital  resources  during the period ended June
30, 1997 were provided by convertible loans (See Notes to Financial Statements),
and stock  placements  and Revenue bonds and  investments.  The formal  business
activity of mining did not begin this quarter  since the activity is just in the
process of being funded.  Sufficient  funds have been made  available by related
parties for the working capital  requirements not filled by other sources.  This
will continue until the commencement of operations.


                                       16

<PAGE>


      NOTES TO XPLORER, S.A. CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                     Three Month Period Ended June 30, 1997

         Management  believes that the Company's  working capital  resources and
anticipated  cash flow from mining  activities will not be sufficient to support
operations  during the year ending December 31, 1997,  therefore  Management has
arranged sufficient financing to fund these activities and to fulfill its budget
requirements.  Although  Management can offer no assurance that the  commitments
for the financing for these activities will be fulfilled.

RESULTS OF OPERATIONS:
         There has not been  sufficient time since the emergence from Chapter 11
Proceedings to begin operations. These operation activities are not scheduled to
begin until the third quarter of
1997.

ESTIMATIONS OF MANAGEMENT:
         Each year,  Atlantic  Management  estimates  or reserves and prepares a
comprehensive mining plan for the then-anticipated  remaining life of the mining
property.  Other metals could also be present in the ore  reserves.  Significant
changes to the Company's plans could occur as a result of mining experience, new
ore  discoveries,  changes in mining  process,  new  investment in equipment and
technology.  Also  permits  may  not be  renewable  under  the  same  terms  and
conditions as originally  granted.  Exploration  could not result in recoverable
metals,  and the  anticipated  pilot  refinery  could not be completed and other
factors.
         The Company's management provides no assurance as to the outcome of any
of these  matters and resulting  adjustments  could be material to the Company's
financial condition and operations.
         Given the above  uncertainties,  Atlantic  utilizes  the values for its
gold ore  resources  based upon a  comprehensive  geological  report  updated by
Christopher L. Pratt, Geologist, dated December 31, 1996, as to ore reserves.
         The  Company's  management  in  compliance  with  applicable  reporting
guidelines has graded the ore reserves as Probable Reserves (indicated reserves)
until  completion of the pilot ore  refinery,  further  mineralization  studies,
additional drilling and sampling, and geological feasibility analysis.

                           PART II. OTHER INFORMATION

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

         N/A

                                       17

<PAGE>




                                   SIGNATURES

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


                                            XPLORER, S.A.
                                            (Registrant)


Date: August 12, 1997                       s/ Steven Mortensen
                                            -------------------
                                            Steven Mortensen,
                                            Chairman and Secretary



                                            /s/ Jon W. Bice
                                            -------------------   
                                            Jon W. Bice  (CFO)


















                                       18