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: December 31,
2007





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





For the
transition period from _____to
_____





Commission
File number 0-11695





APEX
RESOURCES
GROUP, INC.


(Exact
name of registrant as specified in charter)





UTAH
            87-0403828(State
      or other jurisdiction of incorporation or organization)
            (I.R.S.
      Employer Identification No.)299 S. Main Street,
      Suite 1300, Salt Lake City, Utah
            84111(Address
      of principal executive offices)
            (Zip
      Code)





(801)
534-4450


Registrant’s
telephone number, including area code





Check
whether the issuer(1)
has filed all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.


Yes
[X]  No [   ]




Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act).


Yes [ 
 ]  No [X]





As of
March 14, 2008, the Company had 120,681,870 shares of its $.001 par value,
common stock outstanding.





Transitional
Small Business Disclosure Format:


Yes [
  ]  No [X]














INDEXPageNumberPART
      I.ITEM
      1.
            Financial
      Statements (unaudited)
            3Balance
      Sheet
            3As
      of December 31, 2007Statement
      of Operations
            4Three
      months and six months ended December 31, 2007 and 2006 and the period from
      inception (January 27, 1984) to December 31, 2007Statement
      of Cash Flows
            5Six
      months ended December 31, 2007 and 2006 and the period from inception
      (January 27, 1984) to December 30, 2007Notes
      to Financial Statements
            6ITEM
      2.
            Management’s
      Discussion and Analysis of Financial
      Condition and Results of Operations
            11ITEM
      3.
            Controls
      and Procedures
            18PART
      IIITEM
      6.
            Exhibits
            18Signatures
            19





2


PART
I - FINANCIAL INFORMATION
 
 ITEM
1. FINANCIAL STATEMENTS
 
 APEX
RESOURCES GROUP, INC.
 (Development
Stage Company)
 BALANCE
SHEET
 
 
 Dec. 31, 2007CURRENT
      ASSETSCash
              
              $
              16,642Total
      Current Assets
              
              
              16,642PROPERTY
      AND EQUIPMENT-
      net of accumulated depreciation
              
              
              96,359OTHER
      ASSETSAccounts
      receivable
              
              
              41,955Oil
      leases
              
              
              67,913Available
      for sale securities
              
              
              111,467221,335Total
      Assets
              
              $
              334,336LIABILITIES
      AND STOCKHOLDERS' DEFICITCURRENT
      LIABILITIESAccounts
      payable
              
              $
              80,724Accrued
      Rent
              
              
              6,600Accounts
      payable - related parties
              
              
              47,901Total
      Current Liabilities
              
              
              135,225STOCKHOLDERS'
      EQUITYCommon
      stock400,000,000
      shares authorized, at $.001 par value; 120,681,870 issued and outstanding
              
              
              120,682Capital
      in excess of par value
              
              
              9,752,801Less
      stock subscriptions receivable
              
              
              (54,209
              )Other
      Comprehensive Income
              
              
              50,116Deficit
      accumulated during the development stage
              
              
              (9,670,279
              )Total
      Stockholders' Equity
              
              
              199,111TOTAL
      LIABILITIES AND STOCKHOLDERS' EQUITY
              
              $
              334,336
 
 
 
 
 See the
accompanying notes to the interim financial statements.
 
  3
  APEX
RESOURCES GROUP, INC.
 (Development
Stage Company)
 STATEMENTS
OF OPERATIONS
 
 
 3
      months ended Dec. 31,
              
              
              6
      months ended Dec. 31,
              
              
              Jan.
      27, 1984 (date of inception of development stage) to Dec.
    31,2007
              
              
              2006
              
              
              2007
              
              
              2006
              
              
              2007REVENUESOther
      non-operating income
              
              $
              -
              
              
              $
              -
              
              
              $
              -
              
              
              $
              650
              
              
              $
              369,232EXPENSESExploration,
      development and administrative - Note 7
              
              
              45,383
              
              
              
              122,833
              
              
              
              123,980
              
              
              
              194,146
              
              
              
              11,176,635Stock
      Based Compensation
              
              
              
              
              
              
              
              
              
              
              247,520
              
              
              
              
              
              
              
              247,520Depreciation
              
              
              1,332
              
              
              
              5,328
              
              
              
              2,664
              
              
              
              10,656
              
              
              
              196,926Total
      operating expenses
              
              
              46,715
              
              
              
              128,161
              
              
              
              374,164
              
              
              
              204,802
              
              
              
              11,621,081NET
      (LOSS) - before other income (expense)
              
              
              (46,715
              )
              
              
              (128,161
              )
              
              
              (374,164
              )
              
              
              (204,152
              )
              
              
              (11,251,849
              )Gain
      on sale of assets
              
              
              -
              
              
              
              91,608
              
              
              
              99,457
              
              
              
              141,636
              
              
              
              1,611,401Loss
      on land foreclosure
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              -
              
              
              
              (1,744
              )Interest
      expense
              
              
              (305
              )
              
              
              (760
              )
              
              
              (305
              )
              
              
              (1,332
              )
              
              
              (28,087
              )NET
      (LOSS)
              
              
              (47,020
              )
              
              
              (37,313
              )
              
              
              (275,012
              )
              
              
              (63,848
              )
              
              $
              (9,670,279
              )Basic
      net (loss) per common share
              
              $
              (0.00
              )
              
              $
              (0.00
              )
              
              $
              (0.00
              )
              
              $
              (0.00
              )Weighted
      average shares outstanding
              
              
              120,681,870
              
              
              
              104,844,195
              
              
              
              120,681,870
              
              
              
              104,844,195
 
    
 
 
 See the
accompanying notes to the interim financial statements.
  4
  APEX
RESOURCES GROUP, INC.
 (Development
Stage Company)
 STATEMENT
OF CASH FLOWS
 
 
 6
      months ended Dec. 31,
              
              
              Jan.
      27, 1984 (date of inception of development state) to Dec.
    31,2007
              
              
              2006
              
              
              2007Cash
      flows from operating activities:Net
      (loss)
              
              $
              (275,012
              )
              
              $
              (63,848
              )
              
              $
              (9,670,279
              )Adjustments
      to reconcile net loss to cash used in operating
activities:Depreciation
              
              
              2,664
              
              
              
              10,656
              
              
              
              196,926Gain
      on sale of assets
              
              
              (99,457
              )
              
              
              (141,636
              )
              
              
              (1,611,402
              )Common
      stock issued for services and expenses
              
              
              -
              
              
              
              -
              
              
              
              5,945,755Stock
      based compensation
              
              
              247,520
              
              
              
              -
              
              
              
              247,520Changes
      in operating assets and liabilities:(Increase)
      decrease in accounts receivable
              
              
              (41,955
              )
              
              
              3,331
              
              
              
              (41,955
              )Increase
      (decrease) in liabilities
              
              
              16,026
              
              
              
              (5,761
              )
              
              
              130,472Net
      cash used in operating activities
              
              $
              (150,214
              )
              
              $
              (197,258
              )
              
              
              (4,802,963
              )Cash
      flows from investing activities:Purchase
      of investments
              
              $
              -
              
              
              $
              -
              
              
              
              (2,428
              )Proceeds
      from sale of assets
              
              
              133,808
              
              
              
              247,131
              
              
              
              2,197,045Purchase
      of oil & gas leases and mining claims
              
              
              
              
              
              
              -
              
              
              
              (67,913
              )Purchase
      of property and equipment
              
              
              -
              
              
              
              -
              
              
              
              (616,225
              )Net
      cash provided by investing activities
              
              
              133,808
              
              
              
              247,131
              
              
              
              1,510,479Cash
      flows from financing activities:Payment
      of notes payable
              
              
              -
              
              
              $
              -
              
              
              
              (137,917
              )Proceeds
      from notes payable
              
              
              -
              
              
              
              -
              
              
              
              277,916Net
      proceeds from issuance of common stock
              
              
              -
              
              
              
              -
              
              
              
              3,169,127Net
      cash provided by financing activities
              
              $
              -
              
              
              $
              -
              
              
              
              3,309,126Net
      increase (decrease) in cash and cash equivalents
              
              
              (16,406
              )
              
              
              49,873
              
              
              
              16,642Cash
      and cash equivalents, beginning of period
              
              
              33,048
              
              
              
              6,775
              
              
              
              -Cash
      and cash equivalents, end of period
              
              $
              16,642
              
              
              $
              56,648
              
              
              $
              16,642
 
 
   See the
accompanying notes to the interim financial statements.
  5


APEX
RESOURCES GROUP, INC.


(Development
Stage Company)


NOTES TO
INTERIM FINANCIAL STATEMENTS


December
31, 2007








1.  ORGANIZATION
AND BASIS OF PRESENTATION





The
Company was incorporated in the State of Utah on January 27, 1984 with
authorized capital stock of 50,000,000 shares at a par value of
$0.001.  On May 17, 1999 the shares authorized was increased to
100,000,000 shares and on March 3, 2000 the amount authorized was increased to
400,000,000 shares with the same par value. On March 26, 2003 the name of the
Company was changed from “Ambra Resources Group, Inc. to “Apex Resources Group,
Inc.”





The
Company has been in the development stage since inception and has been engaged
in the business of the acquisition of mining and oil property interests and
other business activities.





In the
opinion of management, the accompanying financial statements contain all
adjustments, consisting only of normal recurring accruals, necessary for a fair
presentation of the Company’s financial position as of December 31, 2007 and the
results of operations and cash flows for the three and six months ended December
31, 2007.





2.  SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES





Accounting
Methods





The
Company recognizes income and expenses based on the accrual method of
accounting.





Dividend
Policy





The
Company has not yet adopted any policy regarding payment of
dividends.





Cash and Cash
Equivalents





The
Company considers all highly liquid instruments purchased with a maturity, at
the time of purchase, of less than three months, to be cash
equivalents.





Property and
Equipment





The
Company’s property and equipment consists of the following:





Office
      equipment
            
            
            145,880Less
      accumulated depreciation
            
            
            (49,521
            )96,359





Office
equipment is depreciated on the straight line method over five and seven
years.











6


APEX
RESOURCES GROUP, INC.


(Development
Stage Company)


NOTES TO
INTERIM FINANCIAL STATEMENTS


December
31, 2007








2.  SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES (continued)





Basic and Diluted Net Income
(Loss) Per Share





Basic net
incomes (loss) per share amounts are computed based on the weighted average
number of shares actually outstanding. Diluted net income (loss) per share
amounts are computed using the weighted average number of common shares and
common equivalent shares outstanding as if shares had been issued on the
exercise of any common share rights unless the exercise becomes antidilutive and
then only the basic per share amounts are shown in the report.





Capitalization of Oil Leases
Costs





The
Company uses the successful efforts cost method for recording its oil lease
interests, which provides for capitalizing the purchase price of the project and
the additional costs directly related to proving the properties and amortizing
these amounts over the life of the reserve when operations begin or a shorter
period if the property is shown to have an impairment in value or expensing the
remaining balance if it is proven to be of no value. Expenditures for oil well
equipment are capitalized and depreciated over their useful lives.





Environmental
Requirements





At
the  report  date  environmental  requirements  related
to the mineral claim interests acquired  are
unknown  and  therefore an estimate of  any
future  cost cannot be made.





Foreign Currency
Translation





Part of
the transactions of the Company were completed in Canadian dollars and have been
translated to US dollars as incurred, at the exchange rate in effect at the
time, and therefore, no gain or loss  from the translations is
recognized. US dollars are considered to be the functional
currency.





Financial
Instruments





The
carrying amounts of financial instruments are considered by management to be
their estimated fair values due their short term maturities.





Income
Taxes





The
Company utilizes the liability method of accounting for income
taxes.  Under the liability method deferred tax assets and liabilities
are determined based on the differences between when it is more likely than not,
that such tax benefits will not be realized.





7


APEX
RESOURCES GROUP, INC.


(Development
Stage Company)


NOTES TO
INTERIM FINANCIAL STATEMENTS


December
31, 2007








2.  SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES (continued)





At
December 31, 2007, the Company had an approximate net operating loss available
for carry forward of $9,670,279.  The tax benefit of approximately
$3,287,895 from the loss carry forward has been fully offset by a valuation
reserve because the use of the future tax benefit is doubtful because the
Company is unable to establish a predictable projection of operating profits for
future years.





The net
operating loss carryovers began to expire in 2005 and will continue expiring
through 2027.





Revenue
Recognition





Revenue
is recognized on the sale and transfer of properties or services and the receipt
other sources of income.





Advertising and Market
Development





The
Company expenses advertising and market development costs as
incurred.





Estimates and
Assumptions





Management
uses estimates and assumptions in preparing financial statements in accordance
with accounting principles generally accepted in the United States of
America.  Those estimates and assumptions affect the reported amounts
of the assets and liabilities, the disclosure of contingent assets and
liabilities, and the reported revenues and expenses.  Actual results
could vary from the estimates that were assumed in preparing these financial
statements.





Concentration of Credit
Risk





Financial
instruments that potentially subject the Company to significant concentration of
credit risk consist primarily of cash and account receivables.  Cash
balances are maintained in accounts that are not federally insured for amounts
over $100,000 but are otherwise in financial institutions of high credit
quality.  Accounts receivable are unsecured; however management
considers them to be currently collectable.





Other Recent Accounting
Pronouncements





The
Company does not expect that the adoption of other recent accounting
pronouncements to have any material impact on its financial
statements.





8


APEX
RESOURCES GROUP, INC.


(Development
Stage Company)


NOTES TO
INTERIM FINANCIAL STATEMENTS


December
31, 2007








3.  OIL LEASES -BEAUFORT SEA PROJECT





On June
9, 1997 the Company   purchased a 3.745% working interest, for
$67,913, in the Beaufort Sea well Esso Pex Home et al Itiyok I-27 consisting of
640 acres and is located at Latitude 70-00', Longitude 134-00', Sections 7, 8,
17, 18, 27, 28, and 37, License No. 55, dated April 22, 1987.  During
1982 and 1983 a consortium of companies participated in the drilling, casing,
and testing the area to a depth of 12,980 feet.





The lease
is shown at cost, which is considered by management to be its estimated fair
value.





The other
partners in the project are coordinated by Exxon Oil Corporation; however there
are no immediate plans to develop the area until a gas pipe line becomes
available.





4.  SIGNIFICANT
TRANSACTIONS WITH RELATED PARTIES





Officers-directors
and their controlled entities and a consultant have acquired approximately 23%
of the outstanding common stock of the Company and have received the restricted
common capital stock issued to them.





On
December 31, 2007 and 2006 the Company owed certain shareholders, directors and
officers of the Company the sum of $47,901 and $313,694,
respectively.





The
Company has made no interest, demand loans to affiliates.  These loans
have been repaid to the Company by the affiliate issuing common
stock.  The affiliations resulted through common officers between the
Company and its affiliates, and at December 31, 2007 the Company owns 14.2 % of
the outstanding stock of one of the affiliates.





5.  STOCKHOLDERS’
EQUITY





At a
special meeting of the Board of Directors of Apex Resources Group, Inc. on
August 14, 2007 the Company issued 11,000,000 stock options to six related party
entities.  These options were immediately vested and were issued at a
price of $.06 per share and expire August 14, 2010.  The Company
accounts for its stock options in accordance with SFAS 123 (R).  The
Company makes a determination of the estimated fair value of share based awards
using the Black-Scholes option-pricing model.  The Black-Scholes model
is affected by the Company’s stock price as well as by assumptions regarding
certain complex and subjective variables.  These variables include,
but are not limited to; the Company’s expected stock price volatility over the
term of the awards and the actual and projected employee stock option exercise
behavior.





The fair
value of the options using this pricing model is calculated to
$247,500.  This amount has been recorded as stock based compensation
for the six months ended December 31, 2007





9


APEX
RESOURCES GROUP, INC.


(Development
Stage Company)


NOTES TO
INTERIM FINANCIAL STATEMENTS


December
31, 2007








6.
GOING CONCERN





The
Company will need additional working capital for its future planned activity and
to service its debt, which raises substantial doubt about its ability to
continue as a going concern.  Continuation of the Company as a going
concern is dependent upon obtaining sufficient working capital to be successful
in that effort.  The management of the Company has developed a
strategy, which it believes will accomplish this objective, through additional
short term loans, and equity funding, which will enable the Company to operate
for the coming year.





7. SCHEDULE OF
EXPENSES





Following
is a summary schedule of the expenses, for the six months ended December 31,
2007 and 2006 shown in the statement of operations under exploration,
development, and administrative.





Three
      months ended,December 312007
            
            
            2006Travel
            
            $
            11,424
            
            
            $
            12,964Office
      expenses
            
            
            13,554
            
            
            
            19,144Professional
            
            
            12,377
            
            
            
            13,903Consultants
            
            
            3,160
            
            
            
            57,201Rent
            
            
            3,300
            
            
            
            6,638Advertising
            
            
            1,025
            
            
            
            12,983Other
            
            
            544
            
            
            
            -$
            45,383
            
            
            $
            122,833Six
      months ended,December 312007
            
            
            2006Travel
            
            $
            20,748
            
            
            $
            17,219Office
      expenses
            
            
            37,209
            
            
            
            36,012Professional
            
            
            27,475
            
            
            
            27,221Consultants
            
            
            28,824
            
            
            
            79,212Rent
            
            
            6,600
            
            
            
            21,056Advertising
            
            
            2,450
            
            
            
            13,426Other
            
            
            674
            
            
            
            -$
            123,980
            
            
            $
            194,146







10


FORWARD-LOOKING
INFORMATION





Except
for the historical information contained herein, the matters discussed in this
Quarterly Report on Form 10-QSB are forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934.  For this purpose any statements
contained in this Form 10-KSB that are not statements of historical fact may be
deemed to be forward-looking statements.  Without limiting the
foregoing, words such as “may,” “hope,” “will,” “expect,” “believe,”
“anticipate,” “estimate” or “continue” or comparable terminology are intended to
identify forward-looking statements.  These statements by their nature
involve substantial risks and uncertainty, and actual results may differ
materially depending on a variety of factors, many of which are not within our
control, including, but not limited to, market factors, market prices (including
regional basis differentials) of natural gas and oil, results for future
drilling and marketing activity, future production and costs, environmental
factors and other factors detailed herein and in our other Securities and
Exchange Commission filings.  Should one or more of these risks or
uncertainties materialize, or should underlying assumptions prove incorrect,
actual outcomes may vary materially from those indicated.  These
forward-looking statements speak only as of their dates and should not be unduly
relied upon.  We undertake no obligation to publicly update or revise
any forward-looking statement, whether as a result of new information, future
events or otherwise.





ITEM 2.
            MANAGEMENT’S
      DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
      OPERATION





General





We are in the development
stage.  Our primary business is the acquisition of small working
interests in oil and gas prospects for investment purposes.  We do not
undertake exploration or drilling activities.  We are not an
operator.  We do not engage in oil and gas production or sales
activities.  Rather, we acquire small working interests in oil and gas
prospects for investment purposes.





Although for the past few years we have
had limited funds, we continue to investigate the acquisition of interests in
oil and gas properties.  To date, we have and will continue to seek to
acquire only minor interests in oil and gas prospects thereby diversifying our
risk.  As a result of our strategy to participate only as a passive
investor in these projects, we hope to keep our overhead to a
minimum.





For a detailed description of our oil
and gas interests, please see the Annual Report of the Company filed on Form
10-KSB for the year ended June 30, 2007.  Following is a brief
description of relevant events that occurred during the quarter ended December
31, 2007.








11


Business
of the Company





Oil and Gas
Prospects





We currently own working interests in
two prospects.





Beaufort
Sea





We hold a 3.745% working interest in
the Beaufort Sea well Esso Pex Home, et. al. Itiyok I-27, consisting of 640
acres, located at Latitude 70-00', Longitude 134-00', Sections 7, 8, 17, 18, 27,
28 and 37.  License No. 55, dated April 22, 1987.  During
1982 and 1983 a consortium of companies participated in drilling, casing and
testing the area to a depth of 12,980 feet.





The main partner in the project is
Imperial Oil Resources Ventures Limited.  A consortium of oil and gas
companies has filed an application to build a natural gas pipeline that could be
used to transport gas from theBeaufort Searegion, but the application
has not been approved.  No current plans have been formulated to
perform further work in the immediateBeaufort Seaarea.  It is
anticipated this area will be developed when a pipeline is
built.





Bastian Bay Field,
Plaquamines Parish, Louisiana





Last year, Imperial Petroleum Inc., the
operator of Bastian Bay Field Lease #16152 in Plaquamines Parish Louisiana made
a cash call to all participants in the well.  The participants in the
well were given the choice to pay the cash call or continue on a non-consent
basis under which the non paying participants relinquishing half of their
working interest.  We determined that it was not in our best interest
to meet the cash call.  Therefore, our interest in this well decreased
from 6.25% to 3.125%.  As of this time Imperial has put work on the
well on hold and we do not know when they expect to begin work
again.





Henry Dome Prospect,
Texas





We own 2.5 participation units in the
Henry Dome Prospect in McMullen County, Texas.  These units give us a
1.875% working interest in JB Henry Dome #1 well.  During the quarter
we were informed that the operator has determined that this well is not of
commercial value as a gas well.





We also own approximately 11,146,679 or
14.2% of the outstanding common shares of Omega Ventures Group, Inc., a
corporation whose common stock is traded on the Over-the-Counter Bulletin Board,
stock symbol “OMGV.”  Certain of our officers and directors, John Rask
and Stephen Golde also serve as officers and directors of Omega Ventures
Group.











12


Liquidity
and Capital Resources





We currently do not have sufficient
cash reserves or cash flow from operations to meet our cash
requirements.  This raises substantial doubt about our ability to
continue as a going concern.  During the six months ended December 31,
2007, we financed our operations with proceeds from the sale of real estate
during the first quarter quarter.  Cash and cash equivalents at the
end of the quarter was $16,642.





Our only business is the acquisition of
minority working interest in oil and gas prospects for
investment.  While we would like to identify and acquire interests in
additional prospects interests, we have limited funds to do
so.  Moreover, none of the prospects in which we currently own
interests are producing, which means we are not currently realizing any revenue
from our investments, nor does it appear that any of these prospects will become
productive in the near future.  Therefore, we do not anticipate
revenue in upcoming quarters. Our ability to continue as a going concern is
dependent upon our obtaining sufficient working capital to meet our operating
needs, to service our debts and satisfy our accounts payable and to acquire
interests in prospects that can generate cash flow.  There is no
guarantee we will be able to do these things.  These issues raise
substantial doubt about our ability to continue as a going concern.





Results
of Operations





Comparison of the three
months ended December 31, 2007 and 2006





We suffered a net loss of $47,020
during the quarter ended December 31, 2007 compared to a net loss of $37,313
during the quarter ended December 31, 2006.  During the 2007 quarter,
total operating expenses were actually 64% lower as compared to the 2006
quarter.  During the 2006 quarter, however, we realized $91,608 gain
on the sale of assets, which partially offset operating expenses during the 2006
quarter.  We realized no comparable gain on the sale of assets during
the quarter ended December 31, 2007 to offset our expenses.   As
a result, we realized a greater net loss even though we significantly reduced
our operating expenses.





During the three months ended December
31, 2006, we realized a gain on the sale of real estate of $91,608 we realized
no comparable gain during the three months ended December 31,
2007.  As we have now sold all of our real estate interests we do not
expect to realize recurring gains of this nature in the future.





During the second fiscal quarter 2008
we realized a 63% decrease in exploration, development and administrative
expense.The following table shows a more detailed comparison of our exploration,
development and administrative expenses during the quarters ended December 31,
2007 and 2006:














13





Three
      months ended,December 312007
            
            
            2006Travel
            
            $
            11,424
            
            
            $
            12,964Office
      expenses
            
            
            13,554
            
            
            
            19,144Professional
            
            
            12,376
            
            
            
            13,903Consultants
            
            
            3,160
            
            
            
            57,201Rent
            
            
            3,300
            
            
            
            6,638Advertising
            
            
            1,025
            
            
            
            12,983Other
            
            
            544
            
            
            
            -$
            45,383
            
            
            $
            122,833





Travel expenses decreased $1,540 or 12%
during the three months ended December 31, 2007 compared to December 31,
2006.  Because the Company has limited funds, our officers and
directors limited travel expenses as much as possible during the second fiscal
quarter 2008.  We anticipate travel expenses in future quarters will
be fairly consistent compared to with travel expenses realized during the three
months ended December 31, 2007.





Office expenses during the quarter
ended December 31, 2007 was $13,554 compared to $19,144 during the same quarter
2006.  This 29% decrease is largely the result of management
curtailing office expenses because of our limited available funds.  We
expect that office expense in upcoming quarters will remain within the range
experienced during the three months ended December 31, 2007 and the three months
ended December 31, 2006.





During the quarter ended December 31,
2007 professional fees were $12,377 compared to $13,903 in professional fees
during the quarter ended December 31, 2006.  The professional fees we
incurred during the quarters ended December 31, 2007 and December 31, 2006 are
primarily incurred in connection with our SEC reporting
obligations.  While fees were slightly lower during the three months
ended December 31, 2007, we generally expect professional fees will be higher in
upcoming fiscal quarters as compared to prior year fiscal quarters.





During the three months ended December
31, 2007 consultants fees decreased to $3,160 from $57,201 during the three
months ended December 31, 2006.  The Company has no
employees.  When management needs services performed it retains
consultants to perform those services.  During the quarter ended
December 31, 2006, consultants’ fees were unusually high as a result of the
Company retaining certain consultants to investigate potential investment ideas
and business opportunities.  While management is making every effort
to reduce costs, which includes hiring fewer consultants, we believe the
significant reduction in consulting fees realized during the current quarter was
more a matter of timing and circumstances and is not indicative of a trend and
we expect consultants’ fees to return to more traditional levels in future
quarters.





Rent expense during the quarter ended
December 31, 2007 was $3,300 compared to $6,638 during the quarter ended
December 31, 2006.  This decrease in rent is attributable to the fact
that we closed our office in Canada in February 2007.  We also closed
our office in Salt Lake City.  Currently, we share office space in
Salt Lake City with a related party on a month-to-month basis.  We pay
the related party $1,100 per month for rent.  We anticipate rent
expense will remain at $1,100 per month in upcoming quarters until such time as
we or the related party terminates our verbal agreement.





14


Advertising expense decreased from
$12,983 during the three months ended December 31, 2006 to $1,025 during the
three months ended December 31, 2007.  This decrease in advertising
expense is primarily the result of management curtailing advertising activities
and allocating our limited funds to other expenses. We anticipate advertising
expense to remain low throughout the remainder of the fiscal year.





Other expense increased from $0 for the
three months ended September 30, 2006 to $544 during the three months ended
September 30, 2007.  We do not expect significant changes in other
expense in upcoming fiscal quarters.





We generated no operating or
non-operating income during the three months December 31, 2007 or
2006.





Comparison of the six months ended
December 31, 2007 and 2006





We suffered a net loss of $275,012
during in the six months ended December 31, 2007 compared to a net loss of
$63,848 during the six months ended December 31, 2006.  This 331%
increase in net loss is the result of our realizing $247,520 in stock based
compensation expense during the six months ended December 31,
2007.  On August 14, 2007 we granted stock options to acquire
11,000,000 shares of common stock of the Company to six related
parties.  These options vested immediately.  The exercise
price of the options is $0.06 per share.  The options expire on August
14, 2010.  We realized no comparable expense during the six months
ended December 31, 2006.





During the six months ended December
31, 2007 we realized a gain on the sale of assets of $99,457, by comparison,
during the six months ended December 31, 2006 we realized a gain of the sale of
assets of $141,636.  As we have now sold all of our real estate
interests we will not realize recurring gains of this nature in the future
unless we acquire more real estate.





During the six months ended December
31, 2007 we realized a 36% decrease in exploration, development and
administrative expense.The following table shows a more detailed comparison of
our exploration, development and administrative expenses during the six months
ended December 31, 2007 and 2006:




Six
      months ended,December
      312007
            
            
            2006Travel
            
            $
            20,748
            
            
            $
            17,219Office
      expenses
            
            
            37,209
            
            
            
            36,012Professional
            
            
            27,475
            
            
            
            27,221Consultants
            
            
            28,824
            
            
            
            79,212Rent
            
            
            6,600
            
            
            
            21,056Advertising
            
            
            2,450
            
            
            
            13,426Other
            
            
            674
            
            
            
            -$
            123,980
            
            
            $
            194,146





15


Travel expenses increased $3,529 or 20%
during the six months ended December 31, 2007 compared to December 31,
2006.  During the current fiscal year, our officers and directors have
incurred greater travel expenses in connection with attempting to resolve
certain financial matters and in the preparation of our periodic
reports.  We expect travel expenses in future quarters to remain
fairly consistent.





Office expenses during the six months
ended December 31, 2007 was nearly unchanged increasing only 3% compared to the
same period 2006.  We expect office expenses in upcoming quarters will
remain at levels consistent with those experienced during the six months ended
December 31, 2007.





During the six months ended December
31, 2007 professional fees were also flat, increasing less than 1% compared to
the six months ended December 31, 2006.  The professional fees we
incur are primarily incurred in connection with our SEC reporting
obligations.  We believe professional fees will be higher throughout
the rest of the current fiscal year.





During the six months ended December
31, 2007 consultants fees decreased $50,338 or 64% compared to the six months
ended December 31, 2006.  As noted above, while management is trying
to limit expenses by hiring fewer consultants, we believe this significant
decrease in consultants fees is, at least, partially the result of timing and
circumstances.  We anticipate consultants fees throughout the balance
of fiscal 2008 will be fairly consistent with what we have incurred in the
past.





Rent expense six months ended December
31, 2007 was $6,600 compared to $21,056 during the six months ended December 31,
2006.  This decrease in rent is attributable to the fact that we
closed our office in Canada in February 2007.  We also closed our
office in Salt Lake City.  As noted above, currently, we share office
space in Salt Lake City with a related party on a month-to-month
basis.  We pay the related party $1,100 per month for
rent.  We anticipate rent expense will remain at $1,100 per month in
upcoming quarters until such time as we or the related party terminates our
verbal agreement.





Advertising expense decreased from
$13,426 during the six months ended December 31, 2006 to $2,450 during the six
months ended December 31, 2007.  As noted above, this decrease in
advertising expense was primarily the result of management reducing advertising
expenses to utilize our limited funds for other expenses. We anticipate
advertising expense to remain low throughout the remainder of the fiscal
year.





16


Other expense increased from $0 for the
six months ended December 31, 2006 to $674 during the six months ended December
31, 2007.  We do not expect significant changes in other expense
during the rest of our 2008 fiscal year.





We generated no operating income during
the six months December 31, 2007 or 2006.  Non-operating income during
the six months ended December 31, 2007 was $0 compared to $650 during the three
months ended December 31, 2006.





Cash
Flows





During
the six months ended December 31, 2007 cash was primarily used to fund operating
expenses. See below for additional discussion and analysis of cash
flow.





Six
      months ended
              December
      31,
              2007
            
            
            Six
      months ended
              December
      31,
              2006Net
      cash used in operating activities
            
            $
            (150,214
            )
            
            $
            (197,258
            )Net
      cash provided by investing activities
            
            $
            133,808
            
            
            $
            247,131Net
      cash provided by financing activities
            
            $
            -
            
            
            $
            -NET
      INCREASE IN CASH AND CASH EQUIVALENTS
            
            $
            (16,406
            )
            
            $
            49,837





Net cash used in operating activities
decreased from $197,258 during the six months ended December 31, 2006 to
$150,214 during the six months ended December 31, 2007.  This decrease
in cash used in operating activities was largely the result of decreased
Exploration, development and administrative expenses during the six months ended
December 31, 2007.





During the six months ended December
31, 2007 net cash provided by investing activities was $133,808 compared to
$247,131 during the six months ended December 31, 2006.  During each
period cash provided from investing activities was generated from the sell of
real estate interests.





We realized no cash from financing
activities in either the six months ended December 31, 2007 or December 31,
2006.





Summary
of Material Contractual Commitments





Currently we have no material
contractual commitments.





Off-Balance Sheet
Financing Arrangements





As of December 31, 2007, we had no
off-balance sheet financing arrangements.





17


ITEM
3.   CONTROLS AND PROCEDURES





Evaluation
of Disclosure Controls and Procedures





We
maintain disclosure controls and procedures, as such term is defined in Rules
13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as
amended (the “Exchange Act”), that are designed to provide reasonable assurance
that information required to be disclosed by us in the reports that we file
or submit under the Exchange Act is recorded, processed, summarized and reported
within the time periods specified in the SEC rules and forms, and that such
information is accumulated and communicated to our management, including our
principal executive officer and principal financial officer, as appropriate, to
allow timely decisions regarding required financial
disclosures.  Because of inherent limitations, our disclosure controls
and procedures, no matter how well designed and operated, can provide only
reasonable, and not absolute, assurance that the objectives of such disclosure
controls and procedures are met.




Subsequent to end of the period covered
in this report, in connection with comments received from the staff of the U.S.
Securities and Exchange Commission(“SEC”), we determined that we had erroneously
accounted for available for sale securities in the audited financial statements
included in our Annual Report on Form 10-KSB, as amended, for the year ended
June 30, 2007,  and the unaudited financial statements included in our
Quarterly Report on Form 10-QSB for the period ended September 30, 2007 and that
we had a material weakness in internal control over financial reporting because
our controls did not identify the error on a timely basis.  As a
result, we will file amendments to these reports to restate the audited
financial statements for the year ended June 30, 2007 and the unaudited
financial statements for the period ended September 30, 2007 included
therein.
  Based on
the foregoing, our principal executive officer and principal financial officer
concluded that our disclosure controls and procedures were not effective as of
December 31, 2007.  As discussed in more detail below, subsequent to
December 31, 2007, the Company made certain changes and is implementing new
policies designed to avoid recurrence of errors of this nature in the
future.
 
 In light of these issues our
management, including our principal executive officer and our principal
financial officer performed additional analysis and procedures to ensure the
unaudited financial statements included in this report are prepared in
accordance with accounting principles generally accepted in the United States
and to ensure the effectiveness
of the design and operation of our disclosure controls and procedures pursuant
to Exchange Act Rules 13a-15(b) and 15d-15(b). Accordingly,
management believes that the financial statements included in this report fairly
present in all material respects the Company’s financial condition, results of
operations and cash flows for the periods
presented.




Changes
in Internal Control over Financial Reporting





There
were no changes in our internal control over financial reporting during the
quarter ended December 31, 2007 that materially affected, or are reasonably
likely to materially affect, our internal control over financial
reporting.




As noted above, subsequent to the end
of the period covered in this report, and in connection with the comments of the
staff of the SEC, we determined that we had erroneously accounted for available
for sale securities in the audited financial statements included in the our
Annual Report on Form 10-KSB for the year ended June 30, 2007 and in the
unaudited financial statements included in our Quarterly Report on Form 10-QSB
for the quarter ended September 30, 2007.  We further determined that
we had a material weakness in internal control over financial reporting because
the controls did not identify the error on a timely basis.  As a
result, we will file amendments to these reports to restate the audited
financial statements for the year ended June 30, 2007 and the unaudited
financial statements for the period ended September 30, 2007 included
therein.
 
 Based on
the determination that we had a material weakness in our internal control over
financial reporting, subsequent to the end of the period covered in this report
the Company effected material changes to its internal control over financial
reporting.  Management has replaced the accounting staff responsible
for the initial accounting error.  Management is also in the process
of implementing new policies requiring our internal accounting staff and
management to receive additional training on accounting
principles generally acceptedin the United States.  Management
believes these changes and additional policies will provide additional and
enhanced internal control over financial reporting and improve the ability of
management to identify any potential errors prior to and during the Company’s
consolidated financial statement close process and prevent recurrence of future
errors of this nature.


PART
II - OTHER INFORMATION








ITEM
6.  EXHIBITS





Exhibits. The
following exhibits are included as part of this report:





31.1
            Certification
      of Principal Executive Officer pursuant to Section 302 of the
      Sarbanes-Oxley Act of 2002


31.2
            Certification
      of Principal Financial Officer pursuant to Section 302 of the
      Sarbanes-Oxley Act of 2002


32.1
            Certification
      of Principal Executive Officer pursuant to Section 906 of the
      Sarbanes-Oxley Act of 2002


32.2
            Certification
      of Principal Financial Officer pursuant to Section 906 of the
      Sarbanes-Oxley Act of 2002





18


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








APEX
      RESOURCES GROUP, INC.Date:
      March 19, 2008
            By:
            /s/  John
      RaskJohn
      RaskPresident,
      Interim Secretary and Interim
Treasurer












































19


---