SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549


                                   FORM 10-QSB


                QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                          OF THE SECURITIES ACT OF 1934


                     For the Quarter Ended November 30, 1997


                         Commission File Number 0-22382


                           SECTOR COMMUNICATIONS, INC.
                 (Name of small business issuer in its charter)



                  Nevada                              56-1051491
      (State or other jurisdiction of     (IRS Employer Identification No.)
       Incorporation or organization)


               7601 Lewinsville Road, Suite 250, McLean, VA 22102
                     Address of principal executive offices

                                 (703) 761-1500
                            Issuer's Telephone Number


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

As of January 30, 1998 there were 917,961 shares of the Registrant's Common
Stock outstanding.
<PAGE>

                           SECTOR COMMUNICATIONS, INC.

                              REPORT ON FORM 10-QSB

                                TABLE OF CONTENTS

                                                                         Page
                                                                         ----

PART I -  FINANCIAL INFORMATION

   Item 1.  Financial Statements

     Consolidated balance sheet -
      November 30, 1997 (unaudited) and February 28, 1997                 3

     Consolidated statement of operations -
      three and nine month periods (unaudited) ended
      November 30, 1997 and 1996                                          4

     Consolidated statement of cash flows -
      nine month periods (unaudited) ended
      November 30, 1997 and 1996                                          5

     Notes to consolidated financial statements (unaudited)               6

   Item 2. Management's Discussion and Analysis                          11


PART II -  OTHER INFORMATION

   Item 6.  Exhibits and Reports on Form 8-K                             15
<PAGE>

                           SECTOR COMMUNICATIONS, INC.
                           CONSOLIDATED BALANCE SHEET
<TABLE>
<CAPTION>
                                                        November 30,  February 28,
                                                            1997          1997
                                                       ------------   ------------
                                                        (Unaudited)
<S>                                                    <C>            <C>         
      ASSETS
CURRENT ASSETS
   Cash and Cash Equivalents                           $    173,267   $     80,096
   Accounts Receivable, net of provision for
    doubtful accounts of $78,885 and $50,678                897,760        618,845
   Marketable Securities                                         --         21,762
   Related Party Receivables                                     --         32,198
   Receivable on Sale of Securities                              --      1,000,000
   Notes Receivables                                         94,139        143,110
   Prepaid Expenses                                          89,746        117,426
                                                       ------------   ------------
     Total Current Assets                                 1,254,912      2,013,437
                                                       ------------   ------------

PROPERTY AND EQUIPMENT                                    2,210,298      2,170,846
   Accumulated Depreciation                              (1,368,113)    (1,060,696)
                                                       ------------   ------------
   Net Book Value                                           842,185      1,110,150
                                                       ------------   ------------

OTHER ASSETS
   Intangible Assets, net                                 5,086,668      5,350,447
   Capitalized Mining Claim Costs                         1,036,523      1,036,523
   Deposits                                                  42,481         41,953
                                                       ------------   ------------
     Total Other Assets                                   6,165,672      6,428,923
                                                       ------------   ------------

     TOTAL OTHER ASSETS                                $  8,262,769   $  9,552,510
                                                       ============   ============

      LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
   Accounts Payable and Accrued Expenses               $  1,698,778   $  1,218,867
   Short-Term Borrowing                                          --         12,028
   Deferred Revenue                                         251,165        449,254
   Due to Related Parties                                   148,756        474,021
                                                       ------------   ------------
     Total Current Liabilities                            2,098,699      2,154,170

Rent Deposit                                                 12,248         12,248
                                                       ------------   ------------

   TOTAL LIABILITIES                                      2,110,947      2,166,418
                                                       ------------   ------------

Commitments and Contingencies                                    --             --

STOCKHOLDERS' EQUITY
   Preferred Stock, $.001 par value; 5,000,000 shares
    authorized, no shares issued and outstanding                 --
   Common Stock, $.001 par value; 50,000,000 shares
    authorized, 45,898,066 and 44,898,066 shares
    issued and outstanding (See Note 10)                     45,898         44,898
   Additional Paid-in Capital                            13,474,729     13,116,354
   Retained Deficit                                      (7,212,921)    (5,658,196)
   Cumulative Foreign Currency Translation Adjustment      (155,884)      (116,964)
                                                       ------------   ------------
     Total Stockholders' Equity                           6,151,822      7,386,092
                                                       ------------   ------------

     TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY        $  8,262,769   $  9,552,510
                                                       ============   ============
</TABLE>

The Accompanying Notes are an Integral Part of These Consolidated Financial
Statements.


                                     Page 3
<PAGE>

                           SECTOR COMMUNICATIONS, INC.
                      CONSOLIDATED STATEMENT OF OPERATIONS
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                            Three Months Ended          Nine Months Ended
                                        November 30,  November 30,  November 30,  November 30,
                                            1997          1996          1997          1996
                                        -----------   -----------   -----------   -----------
<S>                                     <C>           <C>           <C>           <C>        
REVENUE
   Telecommunication Revenue            $   257,821   $    96,807   $   704,047   $   679,128
   Software Sales & Maintenance             820,257       193,787     1,481,400       193,787
                                        -----------   -----------   -----------   -----------
                                          1,078,078       290,594     2,185,447       872,915

COST OF SALES                               352,870       106,866       975,224       636,671
                                        -----------   -----------   -----------   -----------

GROSS PROFIT                                725,208       183,728     1,210,223       236,244
                                        -----------   -----------   -----------   -----------

OPERATING EXPENSES
   Gold Exploration Costs                     3,063       117,603        60,146       356,939
   Software Development Costs               175,017       140,480       590,684       140,480
   Sales, General & Administrative          579,624     1,145,806     2,149,608     2,028,061
                                        -----------   -----------   -----------   -----------
     Total Operating Expenses               757,704     1,403,889     2,800,438     2,525,480
                                        -----------   -----------   -----------   -----------

Loss From Operations                        (32,496)   (1,220,161)   (1,590,215)   (2,289,236)
                                        -----------   -----------   -----------   -----------

OTHER INCOME (EXPENSE)
   Interest Expense                            (612)      (97,884)       (1,836)     (265,241)
   Other Income (Expense)                    14,718      (238,920)       34,840      (225,083)
   Foreign Exchange Gain (Loss)               6,108       (64,098)        2,486           816
                                        -----------   -----------   -----------   -----------

     Total Other Income (Expense)            20,214      (400,902)       35,490      (489,508)
                                        -----------   -----------   -----------   -----------

Loss Before Provision for Income Taxes      (12,282)   (1,621,063)   (1,554,725)   (2,778,744)

Provision for Income Taxes                       --            --            --            --
                                        -----------   -----------   -----------   -----------

Net Loss                                $   (12,282)  $(1,621,063)  $(1,554,725)  $(2,778,744)
                                        ===========   ===========   ===========   ===========

Loss Per Share                          $      (.01)  $     (2.23)  $     (1.71)  $     (5.91)
                                        ===========   ===========   ===========   ===========

Weighted Average Number of Shares
 Outstanding (See Note 10)                  917,961       725,552       907,634       470,168
</TABLE>

The Accompanying Notes are an Integral Part of These Consolidated Financial
Statements


                                     Page 4
<PAGE>

                           SECTOR COMMUNICATIONS, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOW
                                   (UNAUDITED)
                            FOR THE NINE MONTHS ENDED

                                                     November 30,  November 30,
                                                         1997          1996
                                                     -----------   -----------
CASH FLOWS FROM OPERATING ACTIVITIES
   Net Loss                                          $(1,554,725)  $(2,778,744)
   Adjustments to Reconcile Net Loss to
    Net Cash Provided by Operating Activities:
     Depreciation and Amortization                       600,189       419,652
     Compensation Portion of Restricted
      Stock Grants                                            --       407,916
     Change in Assets and Liabilities, Net
      of Effect of Acquisition:
        (Increase) Decrease in Assets
          Accounts Receivable                           (278,915)     (112,621)
          Repayment of Related Party Receivable           32,198        25,745
          Prepaid Expenses and Deposits                   27,152       (83,669)
          Receivable on Sale of Securities             1,000,000            --
        (Decrease) Increase in Liabilities
          Accounts Payable                               479,911       103,921
          Related Party Payable                           34,110        24,681
          Deferred Revenue                              (198,089)      295,000
          Accrued Interest on Loan Payable                    --       249,114
          Rent Deposit                                        --        12,248
                                                     -----------   -----------
Net Cash (Used) by Operating Activities                  141,831    (1,436,757)
                                                     -----------   -----------

CASH FLOWS FROM INVESTING ACTIVITIES:
   Purchase of Fixed Assets                              (42,429)      (14,226)
   Proceeds from Sale of Marketable Securities                --     1,930,000
   Decrease in Marketable Securities                      21,762            --
   Payment for the Acquisition of Histech                     --      (700,000)
   Payment for the Acquisition of Sector AG                   --       (12,000)
   Cash Balances of Histech and Mountain                      --        36,587
   Cash Balance of Sector Received in the
    Reverse Acquisition                                       --        62,022
   Loans Receivable                                       48,971      (257,178)
   Proceeds from Short-Term Borrowing                         --       486,259
   Repayment of Short-Term Borrowing                     (12,078)     (300,000)
   Payment for the Investment in DBE                          --    (1,050,000)
                                                     -----------   -----------
Net Cash Provided by Investing Activities                 16,226       181,464
                                                     -----------   -----------

CASH FLOWS FROM FINANCING ACTIVITIES:
   Proceeds from the Sale of Convertible Debentures           --       911,745
   Proceeds from the Exercise of Warrants                     --        60,516
   Proceeds from the Sale of Common Stock                     --       250,000
                                                     -----------   -----------
Net Cash Provided By Financing Activities                     --     1,222,261
                                                     -----------   -----------

Effect of Exchange Rate Changes on Cash                  (64,886)      128,590
                                                     -----------   -----------

Net Increase in Cash                                      93,171        95,558
Cash - March 1,                                           80,096        22,429
                                                     -----------   -----------
Cash - November 30,                                  $   173,267   $   117,987
                                                     ===========   ===========

SUPPLEMENTAL CASH FLOWS INFORMATION:
   Cash Paid For:

     Interest                                        $        --   $       333
                                                     ===========   ===========
     Taxes                                           $        --   $        --
                                                     ===========   ===========

The Accompanying Notes are an Integral Part of These Consolidated Financial
Statements.


                                     Page 5
<PAGE>

                           SECTOR COMMUNICATIONS, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                   (UNAUDITED)
                                NOVEMBER 30, 1997

NOTE 1 -    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

      a)    Basis of Presentation. The accompanying financial statements have
            been prepared in accordance with generally accepted accounting
            principles for interim financial information and with the
            instructions to Form 10-QSB. Accordingly, they do not include all of
            the information and footnotes required by generally accepted
            accounting principles for complete financial statements. In the
            opinion of management, all adjustments (consisting only of normal
            recurring adjustments) considered necessary for a fair presentation
            have been included. Certain reclassifications have been made to the
            prior period to conform to the current period's presentation.

            For further information refer to the financial statements and
            footnotes included in the Registrant's Annual Report on form 10-KSB
            for the fiscal year ended February 28, 1997.

            The results of operations for any interim period are not necessarily
            indicative of the results to be expected for the full fiscal year
            ending February 28, 1998.

            On June 18, 1996, Sector Communications, Inc. ("Sector"), formerly
            Aurtex, Inc., acquired all the outstanding capital stock of Global
            Communications Group, Inc. ("Global"). For accounting purposes, this
            acquisition has been treated as a recapitalization of Sector with
            Global as the acquirer in a reverse acquisition.

            The unaudited consolidated balance sheet as of November 30, 1997 and
            the consolidated statements of operations and cash flows for the
            three and nine month periods ended November 30, 1997 and 1996 are
            those of Sector and its subsidiaries (collectively the "Company").
            All significant intercompany accounts and transactions have been
            eliminated.

            The financial statements presented for periods prior to the
            acquisition of Global present the financial position and results of
            operations solely of Global, and do not include the financial
            position or results of operations of Sector or any of its
            subsidiaries. As such, the unaudited statements of operations and
            cash flows for the three months ended May 31, 1996 reflect the
            results of operations of only Global.

            The accompanying consolidated financial statements as of November
            30, 1997 and for the three and nine months then ended include the
            accounts of Sector and its subsidiaries (see note 8). Such
            subsidiaries are as follows:

            Global Communications, Inc.                      100% owned
            HIS Technologies AG                               60% owned
            Mountain Software AG                             100% owned


                                     Page 6
<PAGE>

                           SECTOR COMMUNICATIONS, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                   (UNAUDITED)
                                NOVEMBER 30, 1997

NOTE 1 -    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

      b)    Loss Per Share

            Loss per share is based on the weighted average number of shares of
            common stock outstanding during the period (See Note 10).

      c)    Foreign Currency Translation

            In accordance with the provisions of Statement of Accounting
            Standard No. 52, "Foreign Currency Translations" ("SFAS No. 52") the
            assets and liabilities of the Company's subsidiaries located outside
            the United States are generally translated at the rates of exchange
            in effect at the balance sheet date. Gains and losses resulting from
            foreign currency transactions are recognized currently in income and
            those resulting from translation of financial statements, with the
            exception of entities operating in highly inflationary economies, as
            Global does in Bulgaria, are accumulated in a separate component of
            stockholders' equity. In highly inflationary economies, SFAS No. 52
            requires that the use of historical exchange rates to translate
            nonmonetary items and current exchange rates to translate monetary
            items. The effect of exchange rate changes is reflected in net loss.

NOTE 2 -    PROPERTY AND EQUIPMENT

            Property and equipment consists of the following:

                                                      November 30,  February 28,
                                                          1997          1997
                                                      -----------   -----------
            Fiber Network                             $   157,837   $   157,837 
            Equipment                                   1,915,170     1,875,718
            Furniture and Fixtures                         47,223        47,223
            Vehicles and Other                             90,068        90,068
                                                      -----------   -----------
                                                        2,210,298     2,170,846
            Less:  Accumulated Depreciation            (1,368,113)   (1,060,696)
                                                      -----------   -----------
                                                      $   842,185   $ 1,110,150
                                                      ===========   ===========
                                                                 
            Depreciation expense for the three month periods ended November 30,
            1997 and 1996 was $107,811 and $122,743, respectively, and for the
            nine month periods ended November 30, 1997 and 1996 was $317,927 and
            $294,969, respectively.

NOTE 3 -    RELATED PARTY TRANSACTIONS

            During the three month period ended November 30, 1996, the Company
            accrued $80,000 for consulting fees incurred for services provided
            by MCG Management Consulting Group, S.A. ("MCG"). This agreement was
            canceled on November 26, 1996. One of the principals of MCG is a
            former director of Sector AG and the former Chairman of the Board of
            Directors of Histech. This liability remains unpaid as of November
            30, 1997


                                     Page 7
<PAGE>

                           SECTOR COMMUNICATIONS, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                   (UNAUDITED)
                                NOVEMBER 30, 1997

NOTE 4 -    NOTES RECEIVABLE

            Notes receivable at November 30, 1997 are as follows: Both of these
            notes are currently due and in default.

            Promissory note receivable from Atcall,
            Inc., bearing interest at 8% per annum.
            This note is personally guaranteed by the
            president of Atcall. Repayment of this note
            was demanded on the note's due date,
            October 23, 1996. On January 20, 1997, the
            Company agreed to restructure payment of
            this amount to be payable $25,000 per month
            with a final balloon payment of
            $25,000, plus all accrued interest.                  $  213,139  
                                                               
            Reserve for potential uncollectability                 (119,000)
                                                               
            Unsecured promissory note receivable from          
            Combined Metals Reduction Company, bearing         
            interest at 10%. The Company has previously        
            established a reserve for the full amount of       
            this note.                                              136,575
                                                               
            Reserve for potential uncollectability                 (136,575)
                                                                 ----------
                                                               
            Total                                                $   94,139
                                                                 ==========
                                                         
            Atcall, Inc. has made only three of its scheduled payments under the
            restructured payment plan. The Company has established a reserve for
            the potential uncollectibility of the note.

NOTE 5 -    INTANGIBLE ASSETS

            Intangible assets at November 30, 1997 are as follows:

            Intangible assets related to the acquisition
             of Histech                                          $4,286,922

            Intangible assets related to the acquisition
             of Mountain                                            595,959


                                     Page 8
<PAGE>

                           SECTOR COMMUNICATIONS, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                   (UNAUDITED)
                                NOVEMBER 30, 1997

NOTE 5 -    INTANGIBLE ASSETS (continued)

            Intellectual property and distribution rights
             acquired by Histech prior to its acquisition
             by the Company, net of foreign currency
             exchange fluctuations.                                  785,338
                                                                 -----------
                                                                   5,668,219
            Amortization of intangible assets and intellectual
             property and distribution rights                       (581,551)
                                                                 -----------

            Total                                                $ 5,086,668
                                                                 ===========

            The intangible asset recorded for intellectual property and
            distribution rights was acquired by Histech based on an agreement,
            as amended, dated May 1, 1996, between Histech and HIS Software AG.

            The excess purchase price over the fair value of the net assets
            acquired of Histech and Mountain will be amortized on a
            straight-line basis over twenty years. Costs related to the
            acquisition of the intellectual property and distribution rights
            purchase by Histech are amortized over the estimated useful life of
            five years.

NOTE 6 -    WARRANTS

            At November 30, 1997, the Company has reserved 3,895,680 shares of
            common stock for issuance upon the exercise of the currently
            outstanding warrants. The exercise prices and expiration dates of
            the warrants are as follows:

                     Number         Exercise       Date          Date of
                   of Shares          Price     Exercisable    Expiration
                   ---------        --------    -----------    ----------
                   2,083,746         $ 0.79        2/28/97      12/31/97
                      11,934           0.79        2/28/97       8/31/97
                     100,000           2.25        2/28/97       6/30/00
                     100,000           3.00        7/20/97       6/30/00
                     100,000           4.00        7/20/98       6/30/00
                     250,000           0.79        2/28/97       7/18/99
                   1,250,000           0.79        2/28/97       7/18/99
                   ---------
                   3,895,680
                   =========

            The number of shares covered by the warrants will be adjusted
            pursuant to the reverse stock splits described in Note 10.

NOTE 7 -    STOCK OPTION PLANS

            At November 30, 1997, the Company has options outstanding for the
            purchase of 1,210,000 shares under the 1994 Stock Plan, at exercise
            prices ranging from $.375 to $1.0625 per share. 510,000 options are
            exercisable as of November 30, 1997. There were no option
            transactions during the period March 1 through November 30, 1997.

            The number of shares covered by the options will be adjusted
            pursuant to the reverse stock splits described in Note 10.


                                     Page 9
<PAGE>

                           SECTOR COMMUNICATIONS, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                   (UNAUDITED)
                                NOVEMBER 30, 1997

NOTE 8 -    SECTOR COMMUNICATIONS AG

            Sector Communications AG was dissolved in July of 1997. At the time
            of its dissolution it had no operating budget, revenues nor
            employees. The Company acquired 100% of the outstanding capital
            stock of Sector Communications AG ("Sector AG") on July 31, 1996,
            from Murray Services, Ltd. ("Murray") for the purpose of holding the
            equity interests acquired by Sector in Switzerland, namely HIS
            Technologies AG and Mountain Software AG. At the time that Sector AG
            was acquired it had neither assets nor liabilities. Equity interests
            in HIS Technologies AG and Mountain Software AG are now held
            directly by Sector.

NOTE 9 -    REVERSE SPLIT OF COMMON STOCK AUTHORIZED

            At the Annual Meeting, held on October 21, 1997, shareholders voted
            to amend Sector's Certificate of Incorporation to authorize a
            reverse split of Sector's common stock. The Board of Directors had
            adopted a resolution authorizing an amendment to Sector's Amended
            and Restated Articles of Incorporation to effect a reverse split of
            Sector's Common Stock, $0.001 par value, whereby every 40 shares of
            Sector Common Stock will be converted into one share. No fractional
            shares of stock would be issued in connection with a reverse split,
            but in lieu thereof, each holder of Common Stock who would otherwise
            be entitled to receive a fraction of a share of Common Stock shall
            have the number of shares rounded up or down to the closest number
            of whole shares of Common Stock. The Board of Directors had no
            immediate plans to effect the authorized reverse split.

NOTE 10 - SUBSEQUENT EVENTS

      1)    Effective December 1, 1997, Sector effected the 1 for 40 share
            reverse split described above. Then, on December 2, Sector effected
            an additional reverse split of 1 for 1.25 shares. These transactions
            had the cumulative effect of a 1 for 50 share reverse split. The
            effect of these transactions have been given retroactive effect in
            the computation of loss per share.

      2)    On December 2, 1997, Sector amended its Certificate of Incorporation
            to reduce the number of shares which it is authorized to issue from
            50,000,000 to 40,000,000 shares.

      3)    On December 23, 1997, Sector sold 250 shares of its 1997 Series A 8%
            Cumulative Preferred Stock for gross proceeds of $250,000 and net
            proceeds of $210,000. The shares have been issued in an offshore
            private placement in accordance with Regulation S of the Securities
            Act of 1933.


                                    Page 10
<PAGE>

Item 6. Management's Discussion and Analysis of Financial Condition and Results
of Operations

RESULTS OF OPERATIONS

The following is management's discussion and analysis of certain significant
factors which have affected the Company's financial position and operating
results during the three and nine month periods ended November 30, 1997 compared
to the three and nine month periods ended November 30, 1996.

Telecommunication Revenue

The Company earns all of its telecommunications revenue from (i) providing
direct-dial services for international long distance calls to hotels in the
cities of Sofia and Plovdiv in Bulgaria; (ii) from the integration, installation
and maintenance of customer-owned digital phone systems; and (iii) from
usage-based percentages of Company-owned digital phone systems through shared
revenue agreements with some of its customers.

The Company's telecommunications revenue increased by $161,014 from $96,807 for
the three months ended November 30, 1996 to $257,821 for the nine months ended
November 30, 1997, and increased by $24,919 from $679,128 for the nine months
ended November 30, 1996 to $704,047 for the nine months ended November 30, 1997.
The increase in revenues from carrier services for the three and nine months is
due to the reconnection, on February 28, 1997, of the Company's digital link to
international carrier service. This link had been interrupted due to the
Bulgarian Telephone Company, without prior notice or cause, unilaterally
terminating the Company's Joint Activity Agreement on July 8, 1996.

Software Sales and Maintenance

Effective August 31, 1996, the Company began recording the software sales and
maintenance revenue of its 60% owned subsidiary, Histech. No revenue related to
Histech's operations was recorded prior to that time, since the acquisition of
Histech was accounted for as a purchase, effective August 31, 1996.

During the three months ended November 30, 1997 and 1996 and nine months ended
November 30, 1997, the Company recorded $820,257, $193,787 and $1,481,400
respectively in software sales and maintenance, net of payments to third party
distributors, generated exclusively by its 60% owned subsidiary, Histech as
follows:

<TABLE>
<CAPTION>
                                           Three Months    Nine Months      Three Months
                                              Ended           Ended            Ended
                                                November 30, 1997        November 30, 1996
                                           ---------------------------   -----------------
<S>                                          <C>           <C>               <C>      
Software Sales                               $645,402      $1,173,119        $ 134,461
Software Maintenance and Consulting           174,855         308,281           59,326
                                             --------      ----------        ---------

Total                                        $820,257      $1,481,400        $ 193,787
                                             ========      ==========        =========
</TABLE>

Histech utilizes the service of software distributors for the sales of its
products in geographic regions in which it has no sales force. During the three
months and nine months ended November 30, 1997 and the three months ended
November 30, 1996, approximately 40% of sales were generated through
distributors.


                                    Page 11
<PAGE>

Histech plans to release several new software products in the fourth quarter of
fiscal 1998 and the first quarter of fiscal 1999 for use on Digital Open VMS,
Microsoft Windows NT and various versions of Unix-based corporate networks.
These products will facilitate the administration of user accounts and security
across all three networks concurrently from a single Windows NT workstation.

Release of the final versions of the Account Geneous and Password Geneous
products for Microsoft Windows NT and Digital Open VMS are anticipated in the
fourth quarter. Support for the Unix operating system is expected in the fourth
and first quarters for Password Geneous and Account Geneous, respectively.
Versions of the software that support additional platforms, as well as the
addition of new applications to the Geneous product line, are scheduled for
release over the next 18 months. The product development schedule is, however,
dependent on the required level of funding being kept available.

Cost of Sales

The majority of the Company's costs of sales for the three months and nine
months ended November 30 relate to costs associated with telecommunication
revenues as shown below.

                              Three Months Ended          Nine Months Ended
                          November 30,  November 30,  November 30,  November 30,
                              1997          1996          1997          1996
                          ------------  ------------  ------------  ------------
Global Communications       $247,131      $ 43,639      $665,438      $573,444
Histech                      105,739        63,227       309,786        63,227
                            --------      --------      --------      --------

   Total                    $352,870      $106,866      $975,224      $636,671
                            ========      ========      ========      ========

Global's costs of sales increased by $203,492 from $43,639 for the three months
ended November 30, 1996 to $247,131 for the three months ended November 30, 1997
and increased by $91,994 from $573,444 for the nine months ended November 30,
1996 to $665,438 for the nine months ended November 30, 1997. These changes are
due primarily to the Company reestablishing its carrier services in the current
nine months which had been terminated in July of 1996 and reconnected in
February of 1997.

                              Three Months Ended          Nine Months Ended
                                  November 30,               November 30,
                              1997          1996          1997          1996
                          ------------  ------------  ------------  ------------
Cost of Sales, as a
  Percent of Revenue           96%           45%           95%           84%

The variances are due in part to increased costs incurred in reestablishing
Global's digital link at the BTC and fixed costs forming a larger percentage of
revenue earned.

Costs of sales related to software products and maintenance are comprised
primarily of commissions and distribution payments. These costs were 13% and 33%
of software sales and maintenance revenue for the three month periods ended
November 30, 1997 and 1996 and 21% and 33% for the nine month periods ended
November 30, 1997 and 1996.

Software Development Costs

Software development costs consist primarily of salaries, employee-related
benefits, consulting fees and other costs directly attributable to the
development of Histech's new distributed systems management products. The
Company believes that a significant level of development is required to remain
competitive and expects that such costs will continue to increase in the future,
although such costs may decline as a percentage of total revenue to the extent
that revenue increases.


                                    Page 12
<PAGE>

Sales, General and Administrative Expense

Consists primarily of personnel costs, including salaries, benefits and bonuses
and related costs for management, finance and accounting, legal and other
professional services. General and administrative expenses are detailed in the
following table by individual company below.

<TABLE>
<CAPTION>
                                  Three Months Ended              Nine Months Ended
                              November 30,   November 30,    November 30,    November 30,
                                  1997           1996            1997            1996
                              ------------   ------------    ------------    ------------
<S>                             <C>           <C>             <C>             <C>       
General and Administrative
   Global Communications        $ 94,082      $  143,337      $  310,762      $  306,241
   Histech                       237,166         539,125         894,442         573,207
   Sector Communications         248,376         463,344         944,404       1,148,613
                                --------      ----------      ----------      ----------

     Total                      $579,624      $1,145,806      $2,149,608      $2,028,061
                                ========      ==========      ==========      ==========
</TABLE>

The decrease in Sector's general and administrative costs in the nine month
period ended November 30, 1997, as compared to the same period in 1996, is due
to a stock compensation expense of $407,916 in 1996 and none in 1997.

Sales, general and administrative costs of Histech consist primarily of salaries
and related costs, fees, marketing expenses, depreciation and the amortization
of intangible assets. Management of Histech believes that as new products are
introduced into the market in the future, significant marketing costs will be
incurred to successfully promote these products.

Interest Expense

Interest expense declined dramatically for the three month and nine month
periods ended November 30, 1997 as compared to the three and nine month periods
ended November 30, 1996. This decrease results from the extinguishing of the
Company's long-term debt on February 28, 1997.

Gold Exploration Costs and Activities

In order to accurately determine the best course to take for the ultimate
divestiture of its gold assets, the Company incurred exploration costs, as more
fully described below, of $3,063 during the three month period ended November
30, 1997 and $60,146 during the nine month period ended November 30, 1997 as
compared to $117,603 incurred during the three month period ended November 30,
1996 and $356,939 during the nine month period ended November 30, 1996. Prior to
June 1, 1996, the Company did conduct gold exploration activities, but due to
the nature of the acquisition of Global as a reverse acquisition, the historic
financial statements are those only of Global and not of Sector, formerly
Aurtex. The reader is referred to the Company's February 29, 1996 and February
28, 1997 10-KSB for details concerning exploration costs incurred during its
years ended February 29, 1996 and February 28, 1997. The Company incurred
approximately $18,000 in exploration costs in the three months ended May 31,
1996 which were incurred prior to the reverse acquisition of Global, and as such
are not shown in the statement of operations as expense.

In connection with the change in the Company's strategic direction the Company
has decided to curtail any significant future gold exploration activities. The
Company is currently evaluating options to determine the possibilities of
divestiture and or discontinuance of its mineral properties described below.
Management believes it has sufficient information from the exploration efforts
conducted recently to properly evaluate various possibilities of divestiture of
the mineral properties, the Company does not expect to incur significant costs
in the future related to its gold exploration properties or other gold
exploration related activities.


                                    Page 13
<PAGE>

Vienna Project

On April 15, 1997, the Vienna Property Exploration License and Option to
Purchase Agreement expired. The Company has written off previously capitalized
costs of $100,000 related to this property.

Ketchum Project

A minor drilling program, consisting of one exploration drill hole of 403 feet
was conducted under the direction of Agricola Metals Company, a principal of
which is a shareholder of the Company, to explore that part of the Wood River
formation immediately under the challis volcanics in the Rooks Creek East area
of the Company's unpatented claim block. According to Agricola Metals Company,
the drill core showed mineralization of the Wood River in this sector. However,
faulting prevented the drilling from reaching the critical zone. Further surface
investigation, and a modest drilling program, will be needed to determine
whether a deposit exists in this location.

LIQUIDITY AND CAPITAL RESOURCES

During the nine month period ended November 30, 1997, the Company financed its
operations primarily through funds it received pursuant to a debt retirement
agreement entered into on February 28, 1997.

The Company is currently experiencing negative cash flow from operations but
management believes that, with the reinstatement of Global's services and
increased sales of Histech, operating cash flow will improve significantly. Even
with these projected improvements in operations and cash flows from Global and
Histech, and the curtailment of gold exploration activities, the funding of
future operations will require further infusion of capital. Negotiations are
currently under way with potential investors wishing to provide additional
operating capital. Based on its current and projected operating levels, the
Company believes that it could attain a breakeven or positive level of cash flow
with the next twelve months.

If additional funds are raised by the Company through the issuance of equity
securities, securities convertible into or exercisable for equity securities, or
an equity securities exchange, the percentage ownership of the then current
stockholders of the Company will be reduced. The Company may issue preferred
stock with rights, preferences or privileges senior to those of the Company's
common stock.

On December 23, 1997, the Company sold 250 shares of its 1997 Series A 8%
Cumulative Preferred Stock for gross proceeds of $250,000 and net proceeds of
$210,000.

FORWARD LOOKING STATEMENTS

Management's Discussion and Analysis of Financial Condition and Results of
Operations contains forward-looking statements which involve risk and
uncertainties. Such forward-looking statements reflect the Company's current
views with respect to future events and reflect the Company's current views with
respect to future events and financial performance, including statements in the
following section concerning the timing and amount of revenues, the level of
expenses incurred and the sufficiency of cash and other resources to fund
operations. Actual results could differ materially from those projected in the
forward-looking statements as a result of the Company's ability to obtain
adequate additional financing as needed, the uncertainties of new product
development and introduction, sales, growth, competitive pressures,
uncertainties connected to the Bulgarian economy, and other risks listed from
time to time in the Company's SEC reports including, but not limited to, Report
on Form 10-KSB for the year ended 2/28/97 (Forward Looking Statements section).


                                    Page 14
<PAGE>

                           PART II--OTHER INFORMATION

Item 6.  Exhibits and Reports on Form 8-K

(a)   Exhibits: 

      Exhibit
      Number
      -------
        3.1       Amendment to Articles of Incorporation - To be filed as an 
                  amendment to Form 10Q-SB.

        27        Financial Data Schedule

(b)   Reports on Form 8-K: NONE

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.


February 2, 1998                                    /s/ Geoffrey A. Button
                                                    ----------------------------
                                                    Geoffrey A. Button
                                                    President and Chief
                                                    Executive Officer


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