**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 March 31, 2007[
                ]
            TRANSITION
                REPORT PURSUANT TO 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
                1934
              For
                the transition period from _____________ to _____________
              Commission
                file number _________





**Commission
      file No. 333-111715**





**AT&S
                HOLDINGS, INC.**(Name
                of Small Business Issuer in Its
                Charter)





**NEVADA**
            **20-0472144**(State
                or other jurisdiction of incorporation or organization)
            (I.R.S.
                Employer Identification No.)




3505
                Manchester TrafficwayKansas
                City, Missouri 64129(Address
                of Principal orExecutive
                Offices)





(816)
                765-7771(Issuer’s
                Telephone Number)





Check
      whether the issuer (1) 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 is a large accelerated filer, an
      accelerated filer, or a non-accelerated filer. See definition of “accelerated
      filer and large accelerated filer” in Rule 12-b-2 of the Exchange Act. (Check
      one): Large accelerated filer [ ] Accelerated filer [ ] Non-accelerated filer
      [X]





Indicate
      by check mark whether the Registrant is a shell company (as defined in Exchange
      Act Rule 12b-2). Yes [ ] No [X]





State
      the
      number of shares outstanding of each of the issuer's classes of common equity,
      as of the latest practicable date:





Date       Class           Shares
      Outstanding


05/01/2007      Common
      stock - $ .001 par value    1,084,167





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





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**AT&S
      HOLDINGS, INC.**





**TABLE
      OF CONTENTS**








**Item
                Number**
            
            **Page****ITEM
                1 - CONDENSED CONSOLIDATED FINANCIAL STATEMENTS:**Condensed
                Consolidated Balance Sheets as of December 31, 2006
                (audited) and March 31, 2007 (unaudited)
            
            3Unaudited
                Condensed Consolidated Statements of Operations for
                the three months ended March 31, 2007 and 2006
            
            5Unaudited
                Condensed Consolidated Statements of Stockholders’
                Equity as of March 31, 2007
            
            6Unaudited
                Condensed Consolidated Statements of Cash Flows for
                the nine months ended March 31, 2007 and 2006
            
            7Notes
                to Condensed Consolidated Financial
                Statements
            
            8**ITEM
                2 - MANAGEMENT'S DISCUSSION AND ANALYSIS Of FINANCIAL
                CONDITION AND RESULTS OF OPERATIONS**
            
            9**ITEM
                3 - CONTROLS AND
                PROCEDURES**
            
            21**PART
                II - OTHER INFORMATION****ITEM
                1 - LEGAL PROCEEDINGS**
            
            22**ITEM
                2 - UNREGISTERED SALES OF SECURITIES AND USE OF
                PROCEEDS**
            
            22**ITEM
                3 - DEFAULTS UPON SENIOR
                SECURITIES**
            
            22**ITEM
                4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY
                HOLDERS**
            
            22**ITEM
                5 - OTHER INFORMATION**
            
            22**ITEM
                6 - EXHIBITS**
            
            22**SIGNATURES**
            
            24


















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**PART
      I - FINANCIAL INFORMATION**





**ITEM
      1 - FINANCIAL STATEMENTS:**




**AT&S
      HOLDINGS, INC.**





**CONDENSED
      CONSOLIDATED BALANCE SHEETS**




**ASSETS:**


December
                31, 2006
            
            March
                31, 2007(Audited)
            
            (Unaudited)CURRENT
                ASSETSCash
            
            $
            158,876
            
            $
            26,593Accounts
                and notes receivableCustomers
            
            
            480,258
            
            
            334,464Other
            
            
            4,338
            
            
            4,551484,596
            
            
            339,015Allowance
                for doubtful accounts
            
            
            80,000
            
            
            80,000404,596
            
            
            259,015Inventory
            
            
            17,334
            
            
            13,134Prepaid
                Advertising
            
            
            22,286
            
            
            16,077Other
                Prepaid Expenses
            
            
            351,399
            
            
            359,826Total
                Current Assets
            
            
            954,491
            
            
            674,645PROPERTY
                AND EQUIPMENT - AT COSTRevenue
                equipment
            
            
            6,354,304
            
            
            6,444,646Delivery
                equipment
            
            
            278,377
            
            
            441,377Vehicles
            
            
            121,980
            
            
            121,980Information
                systems and equipment
            
            
            210,492
            
            
            210,492Office
                equipment
            
            
            47,566
            
            
            51,835Leasehold
                improvements
            
            
            67,000
            
            
            67,0007,079,719
            
            
            7,337,330Accumulated
                depreciation
            
            
            1,966,568
            
            
            2,090,7195,113,151
            
            
            5,246,611OTHER
                ASSETSDeposits
            
            
            10,110
            
            
            10,110Deferred
                loan fees
            
            
            50,000
            
            
            50,000Accumulated
                amortization
            
            
            47,227
            
            
            49,7672,773
            
            
            23312,883
            
            
            10,343Total
                Assets
            
            $
            6,080,525
            
            $
            5,931,599







The
      accompanying notes are an integral part of these statements.


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**LIABILITIES
      AND STOCKHOLDERS' EQUITY:**


December
                31, 2006
            
            March
                31, 2007CURRENT
                LIABILITIES
            
            (Audited)
            
            (Unaudited)Current
                maturities of long-term debt - related party
            
            $
            -
            
            $
            -Current
                maturities of long-term debt - other
            
            
            535,889
            
            
            582,011Line
                of credit
            
            
            429,988
            
            
            130,000Outstanding
                checks in excess of cash balance
            
            
            0
            
            
            73,926Accounts
                payableTrade
            
            
            225,306
            
            
            212,274Sales
                tax payable
            
            
            12,995
            
            
            10,694238,301
            
            
            222,968Accrued
                liabilitiesSalaries
            
            
            15,604
            
            
            28,869Payroll
                taxes and other
            
            
            1,194
            
            
            2,208Interest
                payable
            
            
            27,628
            
            
            15,073Security
                deposits
            
            
            500
            
            
            500Property
                taxes
            
            
            -
            
            
            4,50044,926
            
            
            51,150Total
                Current Liabilities
            
            
            1,249,104
            
            
            1,060,055LONG-TERM
                DEBT, less current maturitiesRelated
                party
            
            
            180,292
            
            
            144,824Subordinated
                debentures - related party
            
            
            45,000
            
            
            45,000Other
            
            
            3,107,601
            
            
            3,174,253Subordinated
                debentures - other
            
            
            264,000
            
            
            274,0004,845,997
            
            
            4,698,132COMMITMENTSSTOCKHOLDERS'
                EQUITYCommon
                stock - authorized 30,000,000 shares of$.001
                par value; issued and outstanding1,084,167
                shares
            
            
            1,084
            
            
            1,084Additional
                paid-in capital
            
            
            1,081,690
            
            
            1,081,690Retained
                earnings
            
            
            151,754
            
            
            150,6921,234,528
            
            
            1,233,466Total
                Liabilities and Stockholders’ Equity
            
            $
            6,080,525
            
            $
            5,931,598

















The
      accompanying notes are an integral part of these statements.


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**AT&S
      HOLDINGS, INC****.**


**UNAUDITED
      CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS**





**THREE
                MONTHS ENDED**REVENUE:
            
            
            **March
                31, 2006**
            
            
            **March
                31, 2007**Equipment
                sales
            
            $
            156,011
            
            $
            97,300Equipment
                rental
            
            
            865,404
            
            
            846,321Drayage
            
            
            95,579
            
            
            77,349Maintenance
            
            
            52,984
            
            
            38,276Other
            
            
            11,159
            
            
            14,670Total
                revenue
            
            
            1,181,137
            
            
            1,073,916COST
                OF SALES:Equipment
            
            
            90,879
            
            
            59,134Equipment
                rental
            
            
            310,864
            
            
            206,732Depreciation
            
            
            86,263
            
            
            123,353Drayage
            
            
            85,066
            
            
            83,659Maintenance
            
            
            8,153
            
            
            26,011Total
                cost of sales
            
            
            581,225
            
            
            498,889Gross
                profit
            
            
            599,912
            
            
            575,027COSTS
                AND EXPENSES:Selling,
                general and administrative expenses
            
            
            431,307
            
            
            479,917Depreciation
                expense
            
            
            13,616
            
            
            16,134444,923
            
            
            496,051Operating
                profit
            
            
            154,989
            
            
            78,976OTHER
                INCOME (EXPENSE):Interest
                expense - related party
            
            
            (11,921
            )
            
            (7,373
            )Interest
                expense - other
            
            
            (49,168
            )
            
            (76,778
            )Gain
                (Loss) on sale of non-revenue equipment
            
            
            0
            
            
            0Other
                income
            
            
            1,512
            
            
            4,113(59,577
            )
            
            (80,038
            )Net
                Earnings (Loss)
            
            $
            95,412
            
            $
            (1,062)BASIC
                net earnings (loss) per share
            
            $
            0.09
            
            $
            (0.00)Weighted
                average shares outstanding
            
            
            1,084,167
            
            
            1,084,167DILUTED
                net earnings (loss) per share
            
            $
            0.09
            
            $
            (0.00)Weighted
                average shares outstanding
            
            
            1,084,167
            
            
            1,084,167









The
      accompanying notes are an integral part of these statements.




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**AT&S
      HOLDINGS, INC.**





**UNAUDITED
      CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY**


**MARCH
      31, 2007**











Common
            
            StockShares
            
            Amount
            
            AdditionalPaid
              In
                Capital
            
            Retained
              Earnings
            
            TotalBalance
                at January 1, 2007
            
            
            1,084,167
            
            $
            1,084
            
            $
            1,081,690
            
            $
            151,754
            
            $
            1,234,528Net
                earnings for the period (unaudited)
            
            
            -
            
            
            -
            
            
            -
            
            $
            (1,062)
            
            $
            (1,062)Balance
                at March 31, 2007 (unaudited)
            
            
            1,084,167
            
            $
            1,084
            
            $
            1,081,690
            
            $
            150,692
            
            $
            1,233,466
















The
      accompanying notes are an integral part of these statements.


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**AT&S
      HOLDINGS, INC.**


**UNAUDITED
      CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS**


**THREE
      MONTHS ENDED MARCH 31, 2006 AND 2007**


**THREE
                MONTHS ENDED****March
                31, 2006**
            
            **March
                31, 2007**CASH
                FLOWS FROM OPERATING ACTIVITIES:Net
                earnings (loss)
            
            
            $95,412
            
            
            $(1,062)Adjustments
                to reconcile net earnings (loss) to cash provided (used) by operating
                activities:Gain
                on sale of equipment
            
            
            (43,607)
            
            
            (33,366)Depreciation
            
            
            99,879
            
            
            139,487Provision
                for losses on accounts receivable
            
            
            4,254
            
            
            1,709Change
                in operating assets and liabilities:Decrease
                in accounts and notes receivable
            
            
            213,303
            
            
            143,872(Increase)
                decrease in prepaid expenses
            
            
            (103,921)
            
            
            1,982Decrease
                in deferred loan fees (net)
            
            
            2,959
            
            
            2,540Increase
                (decrease) in accounts payable and
              accrued
                liabilities
            
            
            (134,652)
            
            
            64,817Net
                cash and cash equivalents provided by operating activities
            
            
            133,627
            
            
            319,979CASH
                FLOWS FROM INVESTING ACTIVITIES:Proceeds
                from sale of equipment
            
            
            105,161
            
            
            84,300Purchase
                of property and equipment
            
            
            (192,073)
            
            
            (323,881)Net
                cash and cash equivalents provided (used) by investing
                activities
            
            
            (86,912)
            
            
            (239,581)CASH
                FLOWS FROM FINANCING ACTIVITIES:Proceeds
                from new financing
            
            
            41,000
            
            
            724,616Principal
                payments on long and short-term debt
            
            
            (246,690)
            
            
            (937,298)Net
                cash and cash equivalents (used) by financing activities
            
            
            (205,690)
            
            
            (212,682)(DECREASE)
                IN CASH
            
            
            (158,975)
            
            
            (132,284)Cash
                - beginning of period
            
            
            244,908
            
            
            158,876Cash
                - end of period
            
            $
            85,933
            
            $
            26,592Interest
                paid during the period:Related
                party
            
            $
            12,584
            
            $
            7,602Other
            
            
            45,678
            
            $
            86,564Total
                interest
            
            $
            58,262
            
            $
            94,166











The
      accompanying notes are an integral part of these statements.




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**AT&S
      HOLDINGS, INC.**


**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**




**FINANCIAL
      STATEMENT PRESENTATION**





We
      are
      providing herein the unaudited historical financial statements of AT&S
      HOLDINGS, INC. as of March 31, 2007, and for the three months ended March 31,
      2007 and 2006. The interim financial statements presented herein have been
      prepared pursuant to the rules and regulations of the Securities and Exchange
      Commission ("SEC"). Certain information and footnote disclosures normally
      included in financial statements prepared in accordance with accounting
      principles generally accepted in the United States of America have been
      condensed or omitted pursuant to such rules and regulations. The interim
      financial statements should be read in conjunction with our annual financial
      statements, notes and accounting policies included in the Company's most recent
      annual report on Form 10-KSB as filed with the Securities and Exchange
      Commission.





The
      information furnished in this report reflects all adjustments (consisting of
      only normal recurring accruals), which are, in the opinion of management,
      necessary for a fair presentation of the results for the interim periods. The
      results of operations for the three month period ended March 31, 2007, are
      not
      necessarily indicative of results that may be expected for the fiscal year
      ending December 31, 2007.





The
      effects of inter-company transactions on current assets, current liabilities,
      revenue, and cost of sales for periods presented and on retained earnings at
      the
      beginning of the periods presented have been eliminated.





BANKING
      ARRANGEMENTS





On
      April
      4, 2007, we changed the terms of our lines of credit and signed an additional
      term loan with our current bank. Our operating and equipment purchase lines
      of
      credit were extended to March 30, 2008. The balance of the equipment purchase
      line of credit, $440,053, was transferred to a new term loan. The new term
      loan
      is a fixed
      interest rate loan in the amount of $440,053 dated April 4, 2007 with a maturity
      date of April 4, 2010. This loan requires 35 consecutive monthly payments of
      interest and principal of $6,642.66 each, beginning May 4, 2007 with interest
      on
      the unpaid balances at an interest rate of 6.9%, and one principal and interest
      payment of $284,013.40 on April 4, 2010, with interest on the unpaid balances
      at
      an interest rate of 6.9%.





SUBORDINATED
      NOTES





We
      filed
      a Registration Statement on Form SB-2 with the Securities and Exchange
      Commission, whereby we registered subordinated notes at $1,000 par for up to
      $5,000,000 for sale to the public. The net proceeds of these notes
      (approximately $4,700,000 assuming all notes are sold and after offering
      expenses) are intended to fund the purchases of revenue equipment. The
      Commission declared the registration statement effective on May 13, 2005. The
      offering of notes is not underwritten and is being sold on a best-efforts basis.
      From May 13, 2005 to March 31, 2007, we sold 13 notes in the aggregate principal
      amount of $319,000. For the quarter ended March 31, 2007 we sold one note in
      the
      principal amount of $10,000. Costs incurred with the preparation of the initial
      registration statement were approximately $100,000. Our expenses incurred in
      connection with the issuance and distribution of the notes from the date our
      registration statement became effective, May 13, 2005, through March 31, 2007
      were approximately $288,000.





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**FORWARD-LOOKING
      STATEMENTS**





**THIS
      FORM 10-QSB CONTAINS FORWARD-LOOKING STATEMENTS INVOLVING RISKS AND
      UNCERTAINTIES. OUR ACTUAL RESULTS IN THE FUTURE COULD DIFFER SIGNIFICANTLY
      FROM
      THE RESULTS DISCUSSED OR IMPLIED IN SUCH FORWARD-LOOKING STATEMENTS. FACTORS
      THAT COULD CAUSE OR CONTRIBUTE TO SUCH A DIFFERENCE INCLUDE, BUT ARE NOT LIMITED
      TO, THOSE DISCUSSED, IN THE SECTION CAPTIONED "MANAGEMENT'S DISCUSSION AND
      ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS” AS WELL AS THOSE
      DISCUSSED ELSEWHERE IN THIS FILING.**





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**I****TEM
                2****-MANAGEMENT'S
                DISCUSSION AND ANALYSIS OF FINANCIAL
                CONDITION AND RESULTS OF
                OPERATIONS**





*In
      this item to the report, references to “AT&S,” the “Company,”“we,”“us,” and
“our” refer to AT&S Holdings, Inc., a Nevada corporation, and our subsidiary
      American Trailer & Storage, Inc., a Missouri corporation (“American
      Trailer”). The following discussion of our financial condition and results of
      operations should be read together with the financial statements and the
      accompanying notes included elsewhere in this quarterly report on Form 10-QSB.*





**Overview**





American
      Trailer was formed on May 15, 1994 under the laws of the State of Missouri
      under the name Financial Credit Corporation. Financial Credit Corporation
      conducted business under the fictitious names of Commercial Trailer and American
      Trailer & Storage. On December 9, 2003, the name was officially changed
      to American Trailer & Storage, Inc. American Trailer has been engaged solely
      in the business of renting and leasing storage containers and semi-trailers
      since inception and does not have any subsidiaries.





On
      December 31, 2003, we re-organized in a holding company structure. At that
      time AT&S became the parent of American Trailer. The Management’s Discussion
      and Analysis of Financial Condition and Results of Operations contained herein
      discusses the historical operations of American Trailer prior to December 31,
      2003 and includes the consolidated financial information for American Trailer
      and AT&S thereafter.





We
      are a
      provider of portable storage and transportation solutions through our rental
      fleet of approximately 2,300 portable storage and transportation units through
      our subsidiary American Trailer. We currently have two branches and operate
      in
      Missouri, Kansas, and Illinois. We primarily concentrate on the Kansas City
      and
      St. Louis metropolitan regions. We feel there are opportunities for growth
      in other Midwestern markets when our capital and human resources are adequate
      to
      handle external branch expansion.





Our
      rental equipment provides secure, accessible temporary storage and
      transportation for a diversified client base of over 700 customers in 77
      different industries. Our customers use our products for a wide variety of
      storage and transportation applications, including the storage of retail and
      manufacturing inventory, protection of construction materials and equipment,
      handling peaks in shipping cycles and transporting material to and from
      customers’ or their construction job sites. Our largest customer, Satellite
      Specialized Transportation (“SST”), constituted 26% of our revenue in 2006, 29%
      of our revenue in 2005 and 6% of our revenue in 2004. SST rents our equipment
      on
      a unit-by-unit, short-term basis. SST uses our equipment to haul cargo and
      freight long distances. In particular, SST has rented our equipment for
      transportation and storage of disaster relief supplies to victims of hurricanes
      and other disasters. In general, SST rents equipment for $500 per unit per
      month. We anticipate that SST will be our second largest customer after Wal-Mart
      for 2007 due to the continued large number of units rented to support disaster
      preparedness and the potential for damaging hurricanes in 2007. Because
      the disaster relief business is mainly short term, we do not purchase equipment
      specifically for this purpose and should not, therefore, have material amounts
      of idle equipment should natural disasters not occur in any given year. We
      mainly rent equipment owned by other entities under agreement with the other
      entities to supply SST with trailers. The trailers are turned back over to
      the
      other entities when SST is finished using them for disaster relief duties.





Our
      second largest customer, Wal-Mart, accounted for 13.5% of our revenue in 2006,
      10% in 2005, 22% in 2004 and 27% in 2003. Wal-Mart rents our storage equipment
      on a store-by-store, unit-by-unit, short-term basis. Rental and trucking
      (delivery and pick-up of storage equipment) rates vary by store location. No
      single store accounts for more than 5% of our revenues. In general, a Wal-Mart
      store rents equipment on a four-week minimum term for $90-$135 per four weeks,
      depending on the type of unit and the quantity of containers rented by the
      particular store. The store also pays delivery and pick-up charges between
      $75-$400 each way, depending on the distance of the store from our location.
      We
      believe that year-to-year reduction in revenues from Wal-Mart may be indicative
      of a trend resulting from improvements by Wal-Mart in its inventory
      management.





Aside
      from Wal-Mart, our other largest customers tend to vary significantly from
      year
      to year. We do not expect our largest customers to continue to represent such
      a
      significant share of our revenues. Indeed, SST rental demand is driven by its
      disaster relief activities and Wal-Mart is continually working to reduce
      inventory levels. If we are unable to replace business from our significant
      customers from year to year, our business would be negatively affected. The
      loss
      of or diminution of these businesses as customers or the inability to
      continually replace business from them and our other significant customers
      would
      require immediate and substantial overhead cost reductions together with the
      disposal of excess equipment to mitigate the effects and prevent failure of
      our
      business. There can be no assurance that we would be able to effectively respond
      to any such customer loss. Management views this risk as very significant and
      should management not immediately implement overhead cost reductions and
      equipment dispersals, we would not be able to meet our obligations. We do not
      expect a significant impact to our financial condition in the next 12 months
      resulting from a decrease in business from our largest customers. We expect
      SST
      to continue to rent equipment on a seasonal, on-going basis for disaster
      preparedness; and disaster relief efforts, should conditions warrant such.
      We do
      not expect Wal-Mart’s demand for equipment to decrease in a significantly short
      period of time. We also anticipate the demand for equipment in other industries
      to cyclically increase from year to year, as has occurred in the past, and
      we
      anticipate that these increases will be substantial enough to replace revenues
      from industries that demand has declined in a given year.







We
      primarily obtain our portable storage units by purchasing new and used
      ocean-going containers and purchasing new and used trailers from the trucking
      industry. We offer a wide range of products in varying lengths and widths with
      an assortment of differentiated features such as security systems, multiple
      doors, electrical wiring and shelving. In addition to our rental operations,
      we
      sell new and used portable storage units and provide ancillary services.
      Although our primary business is rental of storage units and trailers, we sell
      units from time to time when the customer demand for purchase exists and we
      are
      able to sell at prices that exceed our cost of replacing the unit or where
      we
      have excess inventory.







Our
      primary revenue source is the rental and sale of portable storage and
      transportation units with our focus being on the rental rather than sale of
      such
      equipment.





As
      noted
      above, our discussion and analysis in this report, and other reports that we
      file with the Securities and Exchange Commission, in our press releases and
      in
      public statements of our officers and corporate spokes-persons contain
      forward-looking statements. In this report, we have used words such as
“anticipate,” “believe,” “estimate,” “may,” “intend,” “expect” and other similar
      expressions, which identify forward-looking statements. Forward-looking
      statements may turn out to be wrong. They can be affected by inaccurate
      assumptions or by known or unknown risks and uncertainties. We undertake no
      obligation to update any forward-looking statement. We provide the following
      discussion of risks and uncertainties relevant to our business. These risk
      factors and uncertainties include:


·
            Our
                significant dependence on several key
                customers;




·
            The
                highly competitive nature of our
                business;




·
            The
                supply and price of used ocean-going containers and storage
                trailers;




·
            Significant
                changes in interest rates;




·
            Seasonal
                fluctuation in our business;




·
            Our
                continued ability to access bank debt;
                and




·
            Our
                dependence on third parties to lease us containers and trailers on
                favorable terms.




Many
      of
      these factors are beyond our control.





**Three
      months ended March 31, 2007 versus March 31, 2006**





Our
      revenues totaled $1,073,917 for the three months ended March 31, 2007. The
      decrease of $107,221 versus the same period in 2006 represents a 9.08% decrease.
      Approximately 78.8%, of total revenues were derived from equipment rental and
      related service revenues (delivery, pick-up, maintenance revenues, etc.).





Approximately
      9.06%, or $97,300, of total revenues was derived from the sale of equipment,
      compared to $156,011, or 13.21% of total revenues during the same period in
      2006. Revenues from equipment sales decreased during the period due to a
      general decrease in demand for equipment purchases from companies in
      varied industries. Because we routinely sell rental equipment as a course of
      our
      business, equipment sales includes both units sold from the rental fleet
      (revenue producing equipment / fixed assets) and units purchased for re-sale
      (sale inventory). The cost of the equipment (included in the cost of goods
      sold)
      was the net book value, after depreciation, of the equipment at the time of
      sale. The line item “Gain on Sale of Equipment” on the Statement of Cash Flows
      is the net gain on the sale of rental equipment and is deducted from our net
      income when calculating “Net Cash Provided by Operating Activities.” The
      proceeds from the sale of the rental equipment is then included in the “Proceeds
      from the Sale of Equipment,” together with the proceeds from the sale of
      non-revenue producing equipment, when used to calculate “Net Cash Used by
      Investing Activities” on the Statement of Cash Flows.





We
      generated rental revenues of $846,321 during the three month period ending
      March
      31, 2007 versus $865,404 during the same period in 2006. The decrease in rental
      revenue of $19,083, or 2.21%, was a result of a decrease in demand for our
      equipment from the trucking industry, offsetting increases in demand from the
      retail, wholesale distribution and sub-contractor industries. Drayage (trucking)
      revenue decreased $18,230, or 19.07%, to $77,349 during the three-month period
      versus the previous year. This decrease is due to a decrease in the numbers
      of
      pick-ups and deliveries due to the decrease in the number of rentals. We
      anticipate that drayage rates will hold steady. Maintenance revenues, charges
      to
      customers for customer related equipment damages the cost of which are included
      in maintenance expenses, decreased $14,708 or 27.76% during the period due
      to
      the general decrease in rental activity.





Cost
      of
      goods sold for the three months ended March 31, 2007 totaled $498,889, a
      decrease of 14.17%, as compared to the same period in 2006. Cost of goods sold
      represented 46.46% of total revenues for the period versus 49.21% during the
      same period 2006. The cost of equipment sold decreased $31,745 or 34.93% due
      to
      the decrease in the number of units sold offset by an increase in the cost
      of
      the units sold. Gross margins on equipment sales, as a result, decreased from
      41.7% to 39.2% as we were not able to marginally increase our prices
      commensurate with our costs. We expect that availability of used trailers and
      containers will remain limited as the shipping industries continue to experience
      high demand. Equipment rental expense, which includes costs to maintain the
      rental fleet not related to customer damages, rent paid to third parties for
      equipment re-rented to our customers, and licensing and titling fees, decreased
      by $104,132, or 33.5%, for the period. The decrease was primarily due to the
      decrease in number of over-the-road semi-trailers and over-the-road refrigerated
      semi-trailers rented from third parties and then rented to customers in the
      trucking industry versus the same period in 2006. We expect the equipment rental
      expense to hold steady or decline over the next six months as we have increased
      the number of trailers available in our owned rental fleet. We will, however,
      continue to re-rent over-the-road equipment for customers when profitable
      opportunities present themselves. Maintenance expenses increased $17,858 or
      219.04% during the period to $26,011. This increase is primarily the result
      of
      an increase in the number of units returned by customers with damages requiring
      additional maintenance to ensure rental worthiness for the new customers. These
      costs are recouped from customers as shown in the maintenance revenue line
      item.





Depreciation
      expense increased $37,090, or 43.00%, due to an increase of owned units in
      the
      rental fleet. Depreciation expense will further increase as a result of
      purchasing more equipment as the fleet continues to grow. Drayage expenses
      increased $1,407, or 1.65% during the period due to an increase in fuel cost.
      Drayage expenses will likely increase during the upcoming 12 months due to
      rising fuel expenses. Our three semi-tractors do not typically require
      significant repair expenses.





Gross
      profits decreased by $24,885, or 4.15%, during the three months ended March
      31,
      2007 versus 2006, representing 53.54% of total revenues and totaling $575,027.
      The decrease in gross profits is mainly due to the decrease in revenue partially
      offset by a larger decrease in cost of goods sold. As the availability of new
      and used shipping containers decreases, we should to be able to continue to
      command higher prices for our equipment, however, this will also cause us to
      pay
      higher prices for our equipment sold and additions to our rental fleet. We
      anticipate that our gross profit margin will be above 50% for the 12 months
      of
      2007, as the third and fourth quarters typically have higher utilization and
      profitability.





Operating
      expenses increased $51,128, or 11.49%, during the three month period ended
      March
      31, 2007 versus the same period in 2006. Operating expenses represented 46.19%
      of total revenues versus 37.67% for the same period in 2006. The increase is
      primarily due to increases in salaries, employee benefits including health
      insurance, and professional fees. We had 14% more employees in 2007 compared
      to
      the same period in 2006. Marketing expenses decreased $13,596, or 31.27% due
      to
      a decrease in direct mail advertising. We expect operating expenses to be under
      45% of total revenues for 2007, as the third and fourth quarters have
      historically seen increases in demand for rental equipment, without marginally
      increasing operating expenses.





Overall,
      interest expense increased $23,062 or 37.75%, during the three months ended
      March 31, 2007 versus the same period in 2006 to $84,151. Interest expense
      constituted 7.84% of total revenues versus 5.17% during the same period in
      2006.
      This increase is primarily due to an increase in the amount of our bank debt
      for
      purchases of new equipment and to an increase in subordinated debt. “Interest
      Expense - Other” (primarily interest accrued to our bank) increased $27,610, or
      56.15% due primarily to increased balances owed to our bank and increased
      interest rates on our floating lines of credit, and due, to a much lesser
      extent, issuance of subordinated debt. We expect interest expenses to increase
      as we expand our fleet through increases in borrowing and as interest rates
      continue to increase over the previous year.





We
      had a
      net loss of $1,062 for the three-month period ended March 31, 2007 versus a
      net
      gain of $95,412 for the same period in 2006. This net loss represents 0.1%
      of
      total revenues for the period versus a net gain representing 8.08% of total
      revenues during the same period in 2006. The decrease in net income is primarily
      attributable to the decrease in revenues and an increase in operating and other
      expenses as described above. We anticipate a positive net income for 2007 as
      gross profits historically increase each quarter and operating expenses should
      not marginally increase.





**Liquidity
      and Capital Resources**




Growing
      our rental fleet is very capital intensive. The amount of capital needed is
      dependent on the number of units we plan to purchase in a given period to
      continue growth and on building the infrastructure to support such growth.
      Over
      the year, our fleet size has been steadily increasing in size as we focused
      on
      purchasing newer equipment and selling, older, non-utilized units. Purchases
      of
      new equipment and additional staff have primarily been funded through the
      issuance of subordinated debt to our principal owner and equipment financing
      on
      a collateralized basis.





A
      note
      payable to the majority shareholder had a balance of $180,292 at December 31,
      2006 and $144,824 at March 31, 2007, and is subordinate to our bank loans.
      This
      note was originally due January 1, 2004 and then extended to January 1, 2005.
      On
      July 15, 2004, other loans to shareholder (which originally had due dates of
      August 15, 2004 and September 20, 2004) were combined with this loan, and the
      due date of the new loan, which required monthly payments of principal and
      interest, was February 15, 2008. This loan agreement was amended on March 15,
      2005. The amended agreement required monthly payments of interest only and
      the
      principal amount was due April 15, 2006. That agreement was further amended
      on
      September 30, 2006 by changing the maturity date to April 15, 2008. Our majority
      shareholder also purchased 2005 series subordinated notes in 2005 totaling
      $45,000. Due to bank financing covenants, the principal owner cannot be repaid
      the balance of the subordinated notes if the total debt to net worth ratio
      exceeds the bank’s maximum limit after any such repayment.





*Operating
      Activities:* Cash
      provided by operating activities for the three-month period ended March 31,
      2007
      was $319,979 compared to $133,627 during 2006. This increase was mainly due
      to
      an increase in depreciation and a decrease in accounts receivable partially
      offset by a decrease in net income.





*Investing
      Activities:* Net
      cash
      used by investing activities during the three-month period ended March 31,
      2007
      was $239,581. This was the result of net purchase of equipment versus proceeds
      received from the sale of equipment, $323,881 versus $84,300 respectively.
      This
      compares to approximately $86,912 net cash used by investing activities during
      2006 as a result of net purchase of equipment versus proceeds received from
      the
      sale of equipment, $192,073 versus $105,161 respectively. Proceeds from the
      sale
      of equipment includes proceeds from both the rental fleet (revenue equipment)
      and non-revenue equipment. We plan to continue selling non-utilized or
      under-utilized equipment and purchase more equipment to meet the demands of
      our
      customers and we anticipate that purchases will outpace sales of equipment
      in
      2007.





*Financing
      Activities:* Net
      cash
      used by financing activities was $212,682 during the three-month period ended
      March 31, 2007 versus $205,690 net cash used in 2006. Approximately $724,616
      provided from proceeds of new financing supplemented cash generated from
      operations to provide funds for the purchase of equipment during the
      three-months ended March 31, 2007. Approximately $937,298 and $246,690 in the
      three-months ended March 31, 2007 and 2006, respectively, was used to pay down
      principal of long-term senior and subordinated debt.





Banking
      Arrangements:




We
      have
      entered into a financing agreement with Bank of the West, Lee’s Summit,
      Missouri. The financing agreement provides us with a reducing revolving
      line-of-credit, an equipment purchase line-of-credit, two fixed interest rate
      term notes, and a working capital line-of-credit.





·
            Reducing
                Revolving Line-of-Credit -- The current maturity date of our reducing
                revolving line-of-credit is March 30, 2008. The monthly reduction
                in
                availability is $26,690 with an interest rate of 6.70%. As of March
                31,
                2007, the outstanding balance on this line of credit was $1,654,044
                with
                $293,572 available funds.


·
            Equipment
                Purchase Line-of-Credit - The equipment purchase line-of-credit provides
                us with capital to purchase revenue producing equipment. The interest
                rate
                on this line of credit is prime (8.25% as of March 31, 2007). As
                of March
                31, 2007, the outstanding balance on this line-of-credit was $440,053
                with
                $309,947 available. This line of credit expires March 28,
                2008.


·
            Working
                Capital Line-of-Credit - The working capital line-of-credit provides
                capital to cover short-term cash flow needs. The interest rate on
                this
                line of credit is prime (8.25% as of March 31, 2007). As of March
                31,
                2007, the outstanding balance on this line-of-credit was $0 with
                $250,000
                available.


·
            Fixed
                Interest Rate Term Note - The fixed interest rate term note was used
                to
                finance the acquisition of Ace Trailer and Storage on October 26,
                2006.
                The interest rate on this note is 7.3%. This note requires monthly
                payments of principal and interest of $16,377.60 and the outstanding
                principal is due October 31, 2013. As of March 31, 2007, the outstanding
                balance on this note was
                $1,021,175.


·
            Fixed
                Interest Rate Term Note - The fixed interest rate term note was used
                to
                finance equipment purchases from April 2005 through March 2006. The
                interest rate on this note is 7.15%. The note requires monthly payments
                of
                principal and interest of $8,904.71 and the outstanding principal
                is due
                March 30, 2009. As of March 31, 2007, this note had a balance of
                $518,412.


·
            Fixed
                Interest Rate Term Note - The fixed interest rate term note was used
                to
                finance equipment purchases in January 2007. The interest rate on
                this
                note is 7.3%. The note requires monthly payments of principal and
                interest
                of $1,647.48 and the outstanding principal is due February 15, 2014.
                As of
                March 31, 2007, this note had a balance of
                $108,119.





The
      following table summarizes our banking lines-of-credit and term
      loans:





Credit
                Facility
            Interest
                Rate
            Amount
                Available as of March 31, 2007
            Balance
                outstanding as of March 31, 2007Reducing
                Revolving Line-of-Credit
            6.70%
            $293,572
            $1,654,044Equipment
                Purchase Line-of-Credit
            prime*
            $309,947
            $440,053Working
                Capital Line-of-Credit
            prime*
            $250,000
            $0Fixed
                Interest Rate Term Note
            7.30%
            $0
            $1,021,175Fixed
                Interest Rate Term Note
            7.15%
            $0
            $518,412Fixed
                Interest Rate Term Note
            7.3%
            $0
            $108,119





*8.25%
      as
      of March 31, 2007.





On
      April
      4, 2007 the balance of $440,053 on the equipment purchase line of credit was
      transferred to a term loan bearing an interest rate of 6.9% with a maturity
      date
      of April 4, 2010. This loan requires monthly payments of interest and principal
      of $6,642.66.





All
      of
      the notes and lines of credit are subject to the provisions of a Security
      Agreement dated September 18, 2003. Covenants of this agreement provide for
      the
      personal guarantees of our majority shareholder and his wife as well as
      subordination of our debt obligations to the majority shareholder.





The
      agreement also requires us to meet certain financial covenants.





Financial
      Covenants




Compliance
      with our financial covenants under our financing agreement is determined as
      of
      December 31 of each year. We were in compliance with two of three restrictive
      covenants as of December 31, 2006. We anticipate being in compliance as of
      all
      three covenants as of December 31, 2007. Per the terms of our business loan
      agreements, we must comply with the following three financial covenants and
      ratios:





1.
            Debt
                Service Coverage Ratio. Maintain a ratio of Debt Service Coverage
                in
                excess of 1.250 to 1.000. The term “Debt Service Coverage Ratio” means our
                Net Operating Income (Net Income + Depreciation + Amortization +
                Interest
                Expense) divided by our required principal payments (or Prior year
                CMLTD)
                + Interest Expense. This coverage ratio will be evaluated as of
                year-end.




The
      formula is EBITDA/CMLTD + interest expense. EBITDA (Earnings before interest,
      taxes, depreciation, and amortization) will be calculated as operating income
      (before interest and taxes) plus any depreciation or amortization expenses.
      CMLTD (current maturities of long term debt plus interest expense) will be
      computed as: the current maturities (principle payments due within the following
      12 months) of all term debt plus all interest expenses from the previous 12
      months associated with all debt (term, lines of credit, subordinated, etc.)
      plus
      any lease payments due within the following 12 months.




The
      current principle balances of any other lines of credit or subordinated debt
      will not be included in CMLTD. This is tested annually from audited financial
      statements.




2.
            Debt
                / Worth ratio. Maintain a ratio of Debt / Worth not in excess of
                4.0 to
                1.0. The ratio “Debt / Worth” means our Total Liabilities (less any
                subordinated debt) divided by our Tangible Net Worth (plus any
                subordinated debt). This leverage ratio will be evaluated as of
                year-end.




3.
            Maintain
                a positive current ratio. Current ratio to be calculated based on
                current
                assets divided by current liabilities less current maturities of
                subordinated debt less any outstanding balance on the equipment purchase
                Line of Credit.




Our
      trailing twelve month debt service coverage ratio for the period ended March
      31,
      2006 is 1.19 : 1.





As
      of
      March 31, 2006, our working capital ratio was .76.





As
      of
      March 31, 2006, our debt-to-equity ratio was 2.49.





We
      are in
      compliance with all restrictive covenants as of the most recent date required
      to
      be tested; the audited financial statements as of and for the year ended
      December 31, 2006.





All
      three
      financial covenants are tested annually using our audited year-end financial
      statements.





The
      reducing line-of-credit is collateralized by a blanket lien on our assets as
      well as the personal guarantee by the principal owner, Richard G. Honan, and
      his
      wife, Kathleen M. Honan.





We
      believe our credit facilities provide us with both short and long-term
      liquidity, the flexibility to acquire revenue equipment on an as needed basis,
      and lower our overall capital costs.





We
      expect
      to acquire at least $500,000 of additional revenue equipment during 2007. As
      of
      May 4, 2007 we have agreements to purchase $415,000 of delivery and rental
      equipment in the second and third quarters of 2007.





We
      believe that our working capital, together with our cash flows from operations,
      borrowings under our working capital and equipment purchase lines-of-credit
      and
      other available funding sources will be sufficient to fund our operations and
      planned growth for at least 12 months.





**Seasonality**





Demand
      for our equipment is somewhat seasonal. This is due mainly to the seasonal
      demands of the retail industry. Retailers demand more equipment in the third
      and
      fourth quarters of each year to handle peak inventory demands of the holiday
      shopping season. Most of the equipment rented by the retailers is returned
      early
      in January of each year, resulting in decreased cash flow from operations for
      the company during the first half of every year. We expect this trend to
      continue.





**Off-Balance
      Sheet Arrangements**





The
      company does not engage, nor plans to engage, in any off-balance sheet financing
      arrangements.





**S
      Corporation Status**





We
      have
      elected to be taxed under the provisions of Subchapter S of the Internal Revenue
      Code. As such, we have not provided any income tax provision in the financial
      statements because, as an S corporation, net earnings and losses are
      passed-through to the shareholders. Provided below is a pro forma condensed
      consolidated income statement of earnings for the most recent fiscal year and
      subsequent interim period that depicts our financial results of operations
      to
      the extent that we would no longer meet the requirements of an S corporation.




**Pro
                Forma Condensed Consolidated Statements Of
                Earnings**YearEnded
            
            Three
                Months EndedDecember
                31,2006
            
            March
                31, 2007Revenues
            
            $4,249,195
            
            $1,073,916Cost
                of Sales
            
            2,003,551
            
            498,889Gross
                profit
            
            2,245,644
            
            575,027Selling
                , general and administrative expenses
            
            1,866,925
            
            479,917Operating
                Profit
            
            378,719
            
            78,976Other
                (Expense)
            
            (261,322)
            
            (80,038)Earnings
                before income taxes
            
            117,397
            
            (1,062)Income
                taxesCurrently
                payable
            
            0
            
            0Deferred
            
            45,786
            
            045,786
            
            0Net
                Earnings
            
            $76,409
            
            $(1,062)BASIC
                Earnings per share
            
            $0.07
            
            $(0.0)Weighted
                average number of shares
            
            1,084,167
            
            1,084,167DILUTED
                Earnings per share
            
            $0.07
            
            $(0.00)Weighted
                average number of shares
            
            1,084,167
            
            1,084,167





We
      currently have three shareholders. We chose S Corporation status because the
      significant tax losses generated due to the equipment depreciation on a tax
      basis are passed through to the shareholders. This has allowed our shareholders
      to defer some personal taxes and invest those saving into the business. Current
      S corporation rules limit the number of shareholders allowed in an S corporation
      to 100 and only allow one class of stock. In the future, these limitations
      may
      limit our ability to raise equity funds and expand our operations. We do not
      feel these limitations are a significant risk to internally growing our current
      operations, however, we may miss out on a significant and/or sizable future
      acquisition opportunity if we could not raise enough equity capital within
      the
      constraints of S corporation rules.





Should
      we
      decide to change our tax status to that of a C-Corporation, it would not have
      an
      immediate impact on our financial condition, results of operations, or cash
      flows. If we curtailed our equipment purchases, we would incur tax liabilities
      at the then-current corporate tax rate.





**Critical
      Accounting Policies and Estimates**





Our
      significant accounting policies are disclosed in Note B to our audited financial
      statements included in the Company’s last annual report on Form 10-KSB as filed
      with the SEC. The following discussion addresses our most critical accounting
      policies, some of which require significant judgment.





The
      preparation of the financial statements in conformity with generally accepted
      accounting principles requires our management to make estimates and assumptions
      that affect the amounts reported in the financial statements and the notes
      to
      those statements. These estimates and assumptions are based upon our evaluation
      of historical results and anticipated future events. Actual results could differ
      from those estimates. For purposes of this section, critical accounting policies
      are those that are, in our management’s view, most important to our financial
      condition and results of operations and that require significant judgments
      and
      estimates. Our management believes our most critical accounting policies relate
      to the following:





We
      recognize revenue from the sale of equipment upon delivery. Lease and lease
      ancillary revenues and related expenses generated under portable storage units
      and trailers are recognized monthly which approximates a straight-line basis.
      The company recognizes revenue from delivery, pick-up and other rental-related
      activities when the service is provided.





We
      depreciate our rental equipment on a 10 or 15-year term with 20% residual
      values. Trailers are depreciated over a 10-year period and containers are
      depreciated over a 15-year period using the straight-line method. Our management
      periodically evaluates our depreciation policy against several factors including
      appraisals from independent parties, profit margins from the sale of depreciated
      assets, and larger competitor’s depreciation policies.





**ITEM
      3.** **CONTROLS AND PROCEDURES**





**EVALUATION
      OF DISCLOSURE CONTROLS AND PROCEDURES**





As
      of the
      end of the period covered by this report, the Company carried out an evaluation
      of the effectiveness of the design and operation of its disclosure controls
      and
      procedures pursuant to Exchange Act Rule 13a-14. This evaluation was done under
      the supervision and with the participation of the Company's Principal Executive
      Officer and Principal Financial Officer. Based upon that evaluation, the
      Principal Executive Officer and Principal Financial Officer concluded that
      the
      Company's accounting controls and procedures are effective in gathering,
      analyzing and disclosing information needed to satisfy the Company's disclosure
      obligations under the Exchange Act.





**CHANGES
      IN INTERNAL CONTROLS**





There
      were no significant changes in the Company's internal controls or in other
      factors that could significantly affect those controls since the most recent
      evaluation of such controls.


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 Table
          of Contents





**PART
      II- OTHER INFORMATION**





**ITEM
      1 - LEGAL PROCEEDINGS**





January
      4, 2007, American Trailer received service of process with respect to a civil
      action brought against it by Jeffery N. Orr, a former officer, director and
      employee of American Trailer. Orr currently owns more than 5% of our outstanding
      common stock.





In
      his
      civil proceeding, which was brought in the Circuit Court of Jackson County,
      Missouri, Orr contends American Trailer breached its written employment contract
      with him as a result of nonpayment of compensation and benefits. Mr. Orr seeks
      damages in the amount of $200,000 for such alleged breach.





In
      the
      same action, Orr has also brought civil claims against our current officers
      and
      directors, Richard G. Honan and Richard G. Honan, II. More specifically, Orr
      contends that Richard G. Honan and Richard G. Honan, II, as directors and
      shareholders of American Trailer, breached fiduciary duties they owed to him.
      According to Orr’s complaint, these individuals failed to discharge their
      fiduciary obligations by causing American Trailer to grant warrants and issue
      promissory notes to Richard G. Honan without adequate consideration and by
      diluting Mr. Orr’s ownership in the Company. Orr also asserts that these
      individuals breached their fiduciary obligations by dissipating corporate assets
      and by removing Mr. Orr from the American Trailer board of directors. Orr seeks
      damages in excess of $75,000 for such alleged breaches. Mr. Orr further contends
      that Richard G. Honan and Richard G. Honan, II made various fraudulent and/or
      negligent statements to Mr. Orr about future compensation and benefits that
      Orr
      would be entitled to receive from American Trailer and the amount of loans
      that
      Richard G. Honan had made to American Trailer. Orr contends these statements
      were made for the purpose of inducing him to consent to certain corporate
      actions and enticing him to make capital investments and to forego salary and
      other benefits. With respect to these claims, Mr. Orr seeks compensatory and
      punitive damages from these individuals.





In
      addition to these monetary claims, Orr seeks an order from the court requiring
      Richard G. Honan, Richard G. Honan, II and American Trailer to provide a
      corporate accounting as required by Missouri law. Moreover, Mr. Orr seeks a
      court order that American Trailer be judicially dissolved and liquidated and
      that a receiver be appointed to take possession of American Trailer’s
      assets.





February
      15, 2007, American Trailer filed a motion to dismiss three of the four counts
      in
      which American Trailer is a defendant in the case of Jeffrey N. Orr vs. American
      Trailer & Storage, Inc. in the Circuit Court of Jackson County, Missouri, on
      the grounds that each of the causes of action fail to state a claim for relief
      against them that may be granted as a matter of law.





In
      the
      same motion, our current officers and directors, Richard G. Honan, and Richard
      G. Honan, II also requested dismissal of all of the counts brought against
      them
      in the same lawsuit also on the grounds that each of the causes of action fail
      to state a claim for relief against them that may be granted as a matter of
      law.





We
      believe that all of Orr’s claims are completely without merit both factually and
      legally. We will continue to vigorously defend against the claims. Richard
      G.
      Honan and Richard G. Honan, II have both advised us that they believe Mr. Orr’s
      claims against them are without basis and that they will continue to vigorously
      defend against these claims.





On
      February 15, 2007, we filed a civil action against Orr. In this civil
      proceeding, which was brought in the District Court of Clark County, Nevada,
      we
      seek declaratory relief and damages.





We
      are
      seeking a declaration that (i) we own 100% of the outstanding shares in American
      Trailer and that no shares are owned by Orr; that (ii) there are no other shares
      of stock, stock rights, options, warrants or other similar claims of ownership
      of American Trailer; that (iii) under the laws of the State of Nevada, as the
      owner of all outstanding shares of American Trailer, we are the only party
      entitled to bring claims arising from the ownership of shares of our wholly
      owned subsidiary; that (iv) we have no contractual or other legal obligation
      to
      purchase any of the outstanding shares owned by Orr; that (v) removal in 2005
      of
      Orr as a director was accomplished in accordance with the By-Laws of our
      corporation and the Law of the State of Nevada; that (vi) removal of Defendant
      Orr in 2005 as an officer of our corporation was accomplished in accordance
      with
      our By-Laws and the laws of the State of Nevada; that (vii) the decisions of
      our
      Board of Directors and officers in borrowing money and the distribution of
      profits either in us or our wholly-owned subsidiary are controlled by the
      business judgment rule and the laws of the State of Nevada; and that (viii)
      we
      are not presently indebted to Orr.





We
      also
      seek to recover our costs and fees associated with the prosecution of this
      action, and for damages or any further or additional relief which we are
      entitled to recover as a result of the acts and omissions of Orr.





**ITEM
      2** **-
      UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF
      PROCEEDS**





The
      Company did not sell any unregistered securities during the period covered
      by
      this report.





We
      filed
      a Registration Statement on Form SB-2 with the Securities and Exchange
      Commission, whereby we registered subordinated notes at $1,000 par for up to
      $5,000,000 for sale to the public. The net proceeds of these notes
      (approximately $4,700,000 assuming all notes are sold and after offering
      expenses) are intended to fund the purchases of revenue equipment. The
      Commission declared the registration statement effective on May 13, 2005. The
      offering of notes is not underwritten and is being sold on a best-efforts basis.
      From May 13, 2005 to March 31, 2007, we sold 13 notes in the aggregate principal
      amount of $319,000. For the quarter ended March 31, 2006 we sold one note in
      the
      principal amount of $10,000. Costs incurred with the preparation of the initial
      registration statement were approximately $100,000. Our expenses incurred in
      connection with the issuance and distribution of the notes from the date our
      registration statement became effective, May 13, 2005 through March 31, 2007
      were approximately $288,000.





**ITEM
      3** **- DEFAULTS UPON SENIOR SECURITIES**


None





**ITEM
      4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY
      HOLDERS**


None





**ITEM
      5- OTHER INFORMATION**


None


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**ITEM
      6- EXHIBITS**





**(a)**
            **Index
                to Exhibits**





EXHIBIT
                NUMBER
            DESCRIPTION--------------
            -----------------------------------------------------------3.01
            Articles
                of Incorporation of AT&S (Incorporated by reference to Exhibit 3.01 to
                the Registrant’s Registration Statement on Form SB-2 filed with the
                Securities and Exchange Commission on January 6, 2004.)3.02
            Bylaws
                of AT&S (Incorporated by reference to Exhibit 3.02 to the Registrant’s
                Registration Statement on Form SB-2 filed with the Securities and
                Exchange
                Commission on January 6, 2004.)31.1*
            Certificate
                of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley
                Act of 200231.2*
            Certificate
                of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley
                Act of 200232.1*
            Certification
                of Chief Executive Officer pursuant to 18 U.S.C. Section
                1350.32.2*
            Certification
                of Principal Financial and Accounting Officer pursuant to 18 U.S.C.
                Section 1350.


---------------------------


*
      Filed
      herewith





**(b)
      Reports on Form 8-K**





We
      filed
      two Form 8-K Reports during the period covered by this report. These reports
      were filed on January 10, 2007 and February 22, 2007. Both reports on related
      to
      the legal proceedings detailed in Part II, Item 1 above.





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**SIGNATURES**





In
      accordance with the requirements of the Exchange Act, the Registrant caused
      this
      report to be signed on its behalf by the undersigned, thereunto duly
      authorized.


AT&S
                HOLDINGS, INC.May
                22, 2007
            
            //s//
                Richard G. HonanRichard
                G. Honan, Chief Executive Officer and Chairman of the Board of
                Directors
              (PRINCIPAL
                EXECUTIVE OFFICER)May
                22, 2007
            
            //s//
                Richard G. Honan IIRichard
                G. Honan II, Chief Financial Officer, Director and President
              (PRINCIPAL
                ACCOUNTING OFFICER)