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

                                   FORM 10-QSB


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

      For the quarterly period ended          July 31, 1999
                                        ----------------------


[   ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

      For the transition period from __________________ to ____________________

      Commission file number   1-14244


                         GLAS-AIRE INDUSTRIES GROUP LTD.
         ---------------------------------------------------------------
        (Exact name of small business issuer as specified in its charter)

              NEVADA                                     84-1214736
 ---------------------------------              -------------------------------
   (State or other jurisdiction                (IRS Employer Identification No.)
 of incorporation or organization)


                  3137 GRANDVIEW HIGHWAY, VANCOUVER, BC V5M 2E9
                  ---------------------------------------------
                     (Address of principal executive office)


                                 (604) 435-8801
                            -------------------------
                           (Issuer's telephone number)


--------------------------------------------------------------------------------
              (Former name, former address and former fiscal year,
                         if changed since last report)

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

Number of shares outstanding of the issuer's Common Stock:

        Class                                     Outstanding at July 31, 1999
-----------------------------                     ----------------------------
Common Stock, $0.01 par value                               1,891,289


<PAGE>

                         Glas-Aire Industries Group Ltd.

                                      INDEX
                                      -----


                                                                           Page
                                                                           ----
PART I.      FINANCIAL INFORMATION

     Item 1. Financial Statements

             Consolidated Condensed Balance Sheets -
               July 31, 1999 and January 31, 1999                            3

             Consolidated Condensed Statement of Operations
               for the three months ended July 31, 1999 and 1998
               and six months ended July 31, 1999 and 1998                   4

             Consolidated Condensed Statement of Cash Flows
               for the three months ended July 31, 1999 and 1998
               and six months ended July 31, 1999 and 1998                   5

             Notes to Consolidated Condensed Financial Statements            6

     Item 2. Management's Discussion and Analysis of
               Financial Condition and Results of Operations                 7

PART II.     OTHER INFORMATION

     Item 6. Exhibits and Reports on Form 8-K                                9


SIGNATURES                                                                   10


                                       2
<PAGE>

                          PART I. FINANCIAL INFORMATION

Item 1. Financial Statements
----------------------------

                         Glas Aire Industries Group Ltd.
                      Consolidated Condensed Balance Sheet

                                                       July 31,     January 31,
                                                         1999          1999
                                                     (Unaudited)     (Audited)
                                                     -----------     ---------
Assets
Current
     Cash and equivalents                            $ 2,668,063    $ 2,110,535
     Accounts receivable                               1,105,088        953,289
     Note receivable from related party                                 506,806
     Inventories                                         801,246        673,688
     Prepaid Expenses                                     93,438         33,460
                                                     -----------    -----------
                                                       4,667,835      4,277,778
Fixed assets                                           1,637,937      1,607,557
Investments in related party                           1,045,440
                                                     -----------    -----------
                                                     $ 7,351,212    $ 5,885,335
                                                     ===========    ===========


Liabilities and Shareholders' Equity
Current
     Bank indebtedness                               $      --      $      --
     Accounts payable and accrued liabilities            944,091        733,512
     Incomes taxes payable                                48,350         94,712
     Current portion - capital lease                      48,581         49,055
                                                     -----------    -----------
                                                       1,041,022        877,279
Obligation under capital lease                            38,124         68,722
Deferred income taxes                                    358,504        358,504
                                                     -----------    -----------
                                                       1,437,650      1,304,505
                                                     -----------    -----------
Shareholders' Equity
     Share capital                                        18,913         15,935
     Contributed surplus                               4,518,157      3,475,695
     Treasury stock                                     (339,573)      (339,573)
     Retained earnings                                 1,831,007      1,546,730
     Cumulative translation adjustment                  (114,942)      (117,957)
                                                     -----------    -----------
                                                       5,913,561      4,580,830
                                                     -----------    -----------
                                                     $ 7,351,212    $ 5,885,335
                                                     ===========    ===========


                             See accompanying notes.

                                       3
<PAGE>
<TABLE>
<CAPTION>


                                   Glas Aire Industries Group Ltd.
                           Consolidated Condensed Statement of Operations
                                             (Unaudited)


                                                   Three Months Ended             Six Months Ended
                                                 July 31,       July 31,       July 31,       July 31,
                                                  1999           1998           1999           1998
                                                  ----           ----           ----           ----

<S>                                             <C>          <C>            <C>            <C>
Sales                                           $2,377489    $ 1,768,732    $ 4,213,276    $ 2,854,328
Cost of sales                                   1,598,119      1,171,631      2,841,244      1,912,023
                                              -----------    -----------    -----------    -----------
Gross Profit                                      779,370        597,101      1,372,032        942,305
                                              -----------    -----------    -----------    -----------
Expenses
     Depreciation                                  63,166         48,025        109,973         90,976
     Research and development                     113,129         83,374        227,059        185,972
     Selling and distribution                     186,452         95,094        320,429        174,400
     General and administrative                   129,503         99,731        282,607        204,082
     Provision for profit sharing                  33,723         28,020         50,265         31,550
     Interest, net                                (28,502)        (8,078)       (59,428)       (27,339)
                                              -----------    -----------    -----------    -----------
                                                  497,471        346,166        930,905        659,641
                                              -----------    -----------    -----------    -----------
Income  before income taxes                       281,899        250,935        441,127        282,664
Income taxes - current                             99,879         75,214        156,851         84,839
                                              -----------    -----------    -----------    -----------
Net Income for the period                     $   182,020    $   175,721    $   284,276    $   197,825
                                              ===========    ===========    ===========    ===========
Net income per share of common stock          $     0.126    $      0.12    $     0.197    $     0.136
Weight average common shares outstanding
(after deducting 158,872 shares of treasury
stock held by the Company)                      1,442,048      1,458,571      1,442,048      1,458,571
                                              ===========    ===========    ===========    ===========



                     See accompanying notes to consolidated financial statements

                                                 4
</TABLE>
<PAGE>
<TABLE>
<CAPTION>

                                      Glas Aire Industries Group Ltd.
                              Consolidated Condensed Statement of Cash Flows
                                                (Unaudited)


                                                       Three Months Ended            Six Months Ended
                                                     July 31,       July 31,       July 31,       July 31,
                                                      1999           1998           1999           1998
                                                      ----           ----           ----           ----
<S>                                               <C>            <C>            <C>            <C>
Increase (decrease) in cash
Cash flows from:
Operating Activities
     Net income for the period                    $   182,020    $   175,721    $   284,277    $   197,825
     Depreciation                                      63,166         48,025        109,973         90,976
     Net change in non-cash working capital           (82,752)       (26,535)      (175,119)       326,223
     Cumulative translation adjustment                (64,746)       (52,297)         3,017        (31,084)
                                                  -----------    -----------    -----------    -----------
      Net cash from operating activities               97,688        144,914        222,148        583,940
                                                  -----------    -----------    -----------    -----------

Financing Activities
     Increase in obligation under capital lease                                                    161,569
     Repayment of capital lease                       (23,179)       (16,952)       (31,072)       (25,777)
     Purchase of treasury stock                                      (12,188)                      (12,188)
     Increase (decrease) in bank indebtedness                       (148,416)
     Common stock                                   1,045,440                     1,045,440
                                                  -----------    -----------    -----------    -----------
     Net cash (used in) financing activities        1,022,261       (177,556)     1,014,368        123,604
                                                  -----------    -----------    -----------    -----------

Investing Activities
     Repayment of note receivable                                                   506,806

     Purchase of capital assets                       (49,343)       (44,473)      (140,354)      (291,943)
     Investments in related party                  (1,045,440)                   (1,045,440)
                                                  -----------    -----------    -----------    -----------
     Net cash used in investing activities         (1,094,783)       (44,473)      (678,988)      (291,943)
                                                  -----------    -----------    -----------    -----------

Increase (decrease) in cash during the period          25,166        (77,115)       557,528        415,601

Cash and equivalents, beginning of period           2,642,897      2,138,669      2,110,535      1,645,953
                                                  -----------    -----------    -----------    -----------

Cash and equivalents, end of period               $ 2,668,063    $ 2,061,554    $ 2,668,063    $ 2,061,554
                                                  ===========    ===========    ===========    ===========

Changes in non-cash working capital
     Accounts receivable                          $  (114,992)   $  (288,256)   $  (151,799)   $   119,014
     Inventories                                     (148,279)        66,305       (127,559)       145,720
     Prepaid expense                                  (66,285)       (23,071)       (59,978)       (16,345)
     Accounts payable and accrued liabilities         346,040        145,164        210,579         98,635
     Income taxes payable                             (99,236)        73,323        (46,362)       (20,801)
                                                  -----------    -----------    -----------    -----------
                                                  $   (82,752)   $   (26,535)   $  (175,119)   $   326,223
                                                  ===========    ===========    ===========    ===========


                        See accompanying notes to consolidated financial statements

                                                     5

</TABLE>
<PAGE>

                         Glas Aire Industries Group Ltd.
              Notes to Consolidated Condensed Financial Statements

                                  July 31, 1999

1.   The Company believes;  the accompanying  unaudited  consolidated  condensed
     financial  statements  contain all  adjustments  (consisting  of only those
     which are normal and recurring in nature) necessary to present fairly,  the
     financial  position  of the  Company as of July 31, 1999 and the results of
     operations  and cash flows for the three and six month periods  ending July
     31, 1999 and 1998, respectively.

2.   These  financial  statements  include  the  accounts of the Company and its
     wholly-owned  subsidiaries,  Multicorp Holdings Inc.,  Glas-Aire Industries
     Ltd.,  Glas-Aire  Industries,  Inc.,  and 326362 BC Ltd. All  inter-company
     transactions are eliminated.

     These financial statements have been prepared in accordance with accounting
     principles   generally   accepted  in  the  United   States.   For  further
     information,  refer to the Company's  consolidated financial statements and
     footnotes  thereto  included in the  Company's  Annual Report filed on Form
     10-KSB with the  Securities  and  Exchange  Commission  for the fiscal year
     ended January 31, 1999.

3.   Certain  comparative  figures from the prior year have been reclassified to
     conform with the current year's presentation.

4.   Inventories by component are as follows:

                                        July 31,   July 31,
                                          1999       1998
                                          ----       ----

                Raw materials           $472,654   $406,868
                Work-in-progress         171,693    108,892
                Finished goods           136,093     91,222
                Supplies                  20,806     20,078
                                        --------   --------
                                         801,246   $627,060
                                        --------   --------

5.   Bank Indebtedness

                                        July 31,   July 31,
                                          1999       1998
                                          ----       ----

                Revolving Bank loan     $      0   $      0
                                        --------   --------

     The revolving bank loan is a Cdn. $1,000,000  overdraft facility,  which is
     due on demand and bears interest at Canadian bank prime rates (6.5% January
     31, 1999,  6.25% July 31, 1999, 6.5% July 31, 1998) plus 1/2%. This line of
     credit is renewable annually.

     The following have been provided as collateral for these loans:

          (a)  General assignments of accounts receivable and inventories.

          (b)  A Cdn.  $2,000,000 demand debenture granting a first fixed charge
               on certain  equipment and a flowing charge  over all other assets
               of the Company.

          (c)  An  unlimited  guarantee  by  the  Company  and  its  subsidiary,
               Glas-Aire Industries Ltd.

6.   Income per share is calculated by dividing the weighted  average  number of
     shares of common stock  outstanding each period into the net income for the
     period. Warrants outstanding were anti-dilutive. Treasury stock held by the
     Company is not included in the number of shares outstanding.

7.   Subsequent Event- On August 4, 1999, the company acquired  2,852,375 shares
     of common stock of Regency Affiliates,  Inc. ("RAI") (OTC, BB, symbol-RAFF)
     for cash of $1,968,000 and 86,000 shares of the company's  common stock for
     an aggregate consideration of $2,281,900.  Upon closing of the transaction,
     the Company owns 4,040,375 shares or approximately 26.1% of the outstanding
     share of RAI. RAI net income for year of 1998 was $1,794,560. For the first
     six months in 1999 their net income was  $920,540  as  compared to $668,633
     for the same period in 1998.


FORWARD-LOOKING STATEMENTS

Statements made in this Form 10-QSB that are not historical or current facts are
"forward-looking  statements"  made  pursuant to the safe harbor  provisions  of
Section  27A of the  Securities  Act of 1933 ("The  Act") and Section 21E of the

                                       6
<PAGE>


Securities Exchange Act of 1934. These statements often can be identified by the
use  of  terms  such  as  "may,"  "will,"  "expect,"  "believe,"   "anticipate,"
"estimate,"  "approximate" or "continue," or the negative  thereof.  The Company
intends that such forward-looking  statements be subject to the safe harbors for
such  statements.  The  Company  wishes to caution  readers  not to place  undue
reliance on any such forward-looking statements, which speak only as of the date
made. Any forward-looking  statements represent management's best judgment as to
what may occur in the future. However, forward-looking statements are subject to
risks,  uncertainties  and important  factors  beyond the control of the Company
that could cause actual results and events to differ  materially from historical
results of operations and events and those  presently  anticipated or projected.
These factors include  adverse  economic  conditions,  entry of new and stronger
competitors,  inadequate  capital,  unexpected  costs,  failure to  successfully
penetrate  the  Company's  markets  in the  United  States,  Canada and in other
foreign   countries  such  as  Japan.  The  Company   disclaims  any  obligation
subsequently  to revise any  forward-looking  statements  to  reflect  events or
circumstances  after the date of such  statement or to reflect the occurrence of
anticipated or unanticipated events.


Item 2. Management's  Discussion and Analysis of Financial Condition and Results
of Operations
--------------------------------------------------------------------------------

Three Months Ended July 31, 1999 vs Three Months Ended July 31, 1998
--------------------------------------------------------------------

     The Company's  sales  increased by 34% from $1,768,732 for the three months
ended July 31,  1998,  to  $2,377,489  for the three months ended July 31, 1999.
This improvement in sales was the result of sales to new customers, sales of new
parts, and volume increases in sales orders from existing customers.

     Gross  profit  margins,  expressed  as a  percentage  of  sales,  decreased
slightly  from 34% for the three months ended July 31, 1998 to 33% for the three
months ended July 31, 1999. This decrease was due to an increase in direct labor
and overhead cost.

     Depreciation  expense  increased  by 32% from  $48,025 for the three months
ended July 31, 1998,  to $63,166 for the three months ended July 31, 1999.  This
increase was the result of new equipment being brought into service.

     Expenses for research and development increased by 36% from $83,374 for the
three months ended July 31, 1998 to $113,129 for the three months ended July 31,
1999.  This  increase  was  primarily  due to (i) an  increase  in the number of
engineering personnel conducting in-house activities,  (ii) an increase in usage
of outside  contractors to  accommodate an increase in research and  development
activities,  and (iii) an increase in travel  expenses to  customers  to provide
extra services related to new design.

     Selling and  distribution  expenses  increased by 96%, from $95,094 for the
three months  ended July 31,  1998,  to $186,452 for the three months ended July
31,  1999.  This  increase  was due to (i) an increase of $36,710 in  commission
expenses  associated with the increase in sales,  (ii) an increase of $13,693 in
warranty  claims,  (iii) an increase of $9,193 in travel expenses related to the
Company's marketing efforts,  and (iv) $31,762 resulting from the initial set up
of an office in Tokyo  with one  full-time  Japanese  employee  to  enhance  the
Company's direct marketing efforts in Japan.

     General and  administrative  expenses increased by 30% from $99,731 for the
three months  ended July 31,  1998,  to $129,503 for the three months ended July
31, 1999, as a result of (i) an increase of $4,775 due to additional maintenance
support fees paid to the EDI program as required from major  customers,  (ii) an
increase  of $11,568  due to  increase  in the  number  of  persons  employed in
administration, (iii) a decrease of $9,000 due to the cancellation of management
contracts,  (iv) an increase of $20,470 in consulting and legal fees, and (v) an
increase of $1,959 in other administration costs.

     The  provision  for profit  sharing  increased  by 20% from $28,020 for the
three months ended July 31, 1998, to $33,723 for the three months ended July 31,
1999. This increase was the result of an increase in income.

     Interest  income (net of interest  expense)  increased  from $8,078 for the
three months ended July 31, 1998, to $28,502 for the three months ended July 31,
1999,  as a result  of an  increase  in  interest  earnings  of  $5,930  on cash
deposits, an decrease of approximately $1,498 in interest expenses for the lease
cost of the CNC Milling  Machine  Centre,  and interest  and penalty  charges of
$12,996 related to the PST (Provincial  Sales Tax) audit performed for the years
1992 to 1997.

     Before income taxes,  the Company's  income increased from $250,935 for the
three months  ended July 31,  1998,  to $281,899 for the three months ended July
31, 1999. This increase in income resulted primarily from higher sales.

                                       7
<PAGE>


Six Months Ended July 31, 1999 vs Six Months Ended July 31, 1998
----------------------------------------------------------------

     The Company's  sales  increased by 48% from  $2,854,328  for the six months
ended July 31, 1998, to $4,213,276 for the six months ended July 31, 1999.  This
increase resulted  primarily (i) from the addition of new customers,  (ii) sales
of new parts, and (iii) additional orders from existing customers.

     The gross profit margins expressed as a percentage of sales, decreased from
33% for the six  month  period  ended  July 31,  1998 to 32% for the six  months
period ended July 31,  1999,  This net  decrease of 1% was  primarily  due to an
increase in direct labor and overhead charges.

     Depreciation expense increased by 21% from $90,976 for the six months ended
July 31, 1998, to $109,973 for the six months ended July 31, 1999. This increase
was the result of the addition of new equipment into service.

     Expenses for research and  development  increased by 22% from  $185,972 for
the six months ended July 31, 1998 to $227,059 for the six months ended July 31,
1999.  This  increase  was due to (i) an increase  in the number of  engineering
personnel conducting in-house  activities,  (ii) an increase in usage of outside
contractors to accommodate an increase in research and  development  activities,
and (iii) an increase in travel  expenses to customers to provide extra services
related to new design.

     Selling and distribution  expenses  increased by 84%, from $174,400 for the
six months  ended July 31,  1998,  to $320,429 for the six months ended July 31,
1999.  This  increase  was  primarily  due to  (i) an  increase  of  $64,416  in
commissions  expenses  from  volume  increases  in sales,  (ii) an  increase  in
warranty claims of $21,843,  (iii) increase of $5,642 in travel expenses related
to the Company's  marketing  study of the  aftermarket  and the promotion of new
products,  and (iv)  $54,128  resulting  from the initial set up of an office in
Tokyo with one  full-time  Japanese  employee  to enhance the  Company's  direct
marketing efforts in Japan.

     General and administrative  expenses increased by 38% from $204,082 for the
six months  ended July 31,  1998,  to $282,607 for the six months ended July 31,
1999 as a result  of (i) an  increase  in the  number  of  persons  employed  in
administration of $24,868,  (ii) a loss on foreign exchange of $9,646,  (iii) an
increase of $9,836 due to  additional  maintenance  support fees paid to the EDI
program  as  required  from  major  customers,  (iv) an  increase  of $36,692 in
consulting and legal fees, (v) a decrease of $9,000 due to the  cancellation  of
management contracts, and (vi) an increase of $6,483 due to other administration
costs.

     The  provision  for profit  sharing  increased 59% from $31,550 for the six
months ended July 31,  1998,  to $50,265 for the six months ended July 31, 1999,
as a result of an increase in profit.

     Interest  income (net of interest  expense)  increased from $27,339 for the
six months  ended July 31,  1998,  to $59,428 for the six months  ended July 31,
1999,  as a result of an  increase  in  interest  earnings  of  $17,595  on cash
deposits, an decrease of approximately $1,498 in interest expenses for the lease
cost of the CNC Milling  Machine  Centre,  and interest  and penalty  charges of
$12,996 related to the PST (Provincial  Sales Tax) audit performed for the years
1992 to 1997.

     Before income taxes,  the Company's  income increased 56% from $282,664 for
the six months  ended July 31,  1998,  to $441,127 for the six months ended July
31, 1999. This increase in income was primarily from higher sales.

Financial Condition and Liquidity

     Working  capital was  $3,626,813 at July 31, 1999 compared to $3,400,499 at
January 31, 1999. The increase  reflects the positive  results of operations for
the period.  During the next six months the  Company  anticipates  making  total
capital  expenditures of approximately  $630,000 as follows:(i) $150,000 for the
purchase of a CNC Machine,  (ii)  $300,000  for a MAAC  Machine,  (iii)  $70,000
computer-aided design software and related hardware,  (iv) $80,000 for leasehold
improvements,  and (v) $30,000 for the QS9000  (Quality  Control  Certification)
process.

                                        8
<PAGE>


                           PART II. OTHER INFORMATION

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

a)   Exhibits: There are no exhibits for the six months ended July 31, 1999.

b)   Reports on Form 8-K: The Company filed an amendment to a report on Form 8-K
     on May 7, 1999. The amendment  related to the Form 8-K filed by the Company
     on April 30, 1999, which disclosed a "Change in Control" of the Company.



                                       9
<PAGE>

                                   SIGNATURES

     Pursuant to the  requirements  of the Securities  Exchange Act of 1934, the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.


Date: September 12, 1999
------------------------

                                         GLAS-AIRE INDUSTRIES GROUP LTD.



                                         /s/ Alex Y. W. Ding
                                         -------------------
                                         Alex Y. W. Ding
                                         President and Chief Operating Officer




                                       10