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 period ended June 30, 1998.

[ ]      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 0-29098

                                 NAVIDEC, INC.
         --------------------------------------------------------------
        (Exact name of small business issuer as specified in its charter)

COLORADO                                            33-0502730
--------                                            ----------
(State or other                                     (IRS Employer
jurisdiction of                                     Identification No.)
incorporation or organization)

                        14 INVERNESS DRIVE, SUITE F-116,
                               ENGLEWOOD, CO 80112
                -------------------------------------------------
               (Address of principal executive offices) (Zip Code)

Issuer's telephone number: 303-790-7565

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

APPLICABLE ONLY TO CORPORATE ISSUERS:

     As of June 30,  1998,  Registrant  had  3,606,221  shares of  common  stock
outstanding.


<PAGE>
                                 NAVIDEC, INC.

                                     INDEX
                                     -----


PART I. FINANCIAL INFORMATION
-----------------------------

     Item 1.  Financial Statements

           Balance Sheets as of June 30, 1998 and December 31, 1997

           Statements of Operations, Three and Six months ended 
           June 30, 1998 and 1997

           Statements of Cash Flows,
           Six months ended June 30, 1998 and 1997

           Notes to Financial Statements

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


PART II. OTHER INFORMATION
--------------------------

     Item 1.  Not Applicable

     Item 2.  Change in Securities and Use of Proceeds

     Item 3.   Not Applicable

     Item 4.  Submission of Matters to a Vote of Security Holders

     Item 5.  Other Information

     Item 6.  Exhibits and Reports on Form 8-K

PART III. SIGNATURES
--------------------

     Item 1.  Signatures


<PAGE>



PART I - FINANCIAL INFORMATION
------------------------------

Item 1.  Financial Statements
                                  NAVIDEC, INC.

                                 BALANCE SHEETS


                                                      June 30,      December 31,
                                                        1998            1997
                                                        ----            ----
ASSETS                                           
CURRENT ASSETS:
Cash and cash equivalents                            $   407,000    $   369,000
Accounts Receivable:
  Trade net of $50,000 allowance for doubtful
    accounts                                         $ 1,065,000    $   726,000
Retainage                                                           $    21,000
Cost and estimated earnings in excess of billing     $   303,000    $   106,000
Notes Receivable                                     $    36,000    $    60,000
Inventory                                            $   352,000    $   549,000
Prepaid expenses and other current assets            $    94,000    $    86,000
                                                     -----------    -----------
Total current assets                                 $ 2,257,000    $ 1,917,000

PROPERTY AND EQUIPMENT, net                          $   953,000    $   713,000

OTHER ASSETS

Restricted certificate of deposit                    $   300,000    $   300,000
Intangibles, net                                     $    52,000    $   169,000
                                                     -----------    -----------
Total Assets                                         $ 3,562,000    $ 3,099,000
                                                     ===========    ===========

                      LIABILITIES AND STOCKHOLDERS EQUITY

CURRENT LIABILITIES
Current portion of capital lease obligations         $    37,000    $    37,000
Notes payable                                        $    63,000    $    63,000
Accounts payable                                     $   801,000    $   778,000
Payable to factor                                    $    96,000    $   190,000
Other accrued liabilities                            $   240,000    $   171,000
                                                     -----------    -----------
Total current liabilities                            $ 1,237,000    $ 1,239,000

CAPITAL LEASE OBLIGATIONS,
net current portion                                  $    78,000    $    95,000

NOTES PAYABLE,
net current portion                                  $   185,000    $   215,000

STOCKHOLDERS  EQUITY

Common stock, no par value;
 20,000,000 shares authorized
 3,606,221 and 3,201,000 shares
 issued and outstanding                              $ 8,319,000    $ 6,768,000
Accumulated deficit                                   (6,257,000)    (5,218,000)
                                                     -----------    -----------
Total stockholders
  equity                                             $ 2,062,000    $ 1,550,000
TOTAL LIABILITIES and
STOCKHOLDERS  EQUITY                                 $ 3,562,000    $ 3,099,000
                                                     ===========    ===========


              See accompanying notes to these financial statements.

                                       3
<PAGE>
<TABLE>
<CAPTION>

                                                   NAVIDEC, INC.

                                             STATEMENTS OF OPERATIONS


                                             FOR THE THREE MONTHS                        FOR THE SIX MONTHS
                                                 ENDED JUNE 30,                             ENDED JUNE 30, 
                                       --------------------------------          --------------------------------
                                           1998                 1997                 1998                 1997
                                       -----------          -----------          -----------          -----------

<S>                                    <C>                  <C>                  <C>                  <C>        
NET SALES                              $ 1,837,000          $ 1,589,000          $ 3,539,000          $ 2,952,000

    Cost of sales                        1,284,000            1,069,000            2,339,000            1,926,000
                                       -----------          -----------          -----------          -----------

GROSS MARGIN                               553,000              520,000            1,200,000            1,026,000

    Operating expense                    1,118,000            1,222,000            2,230,000            1,991,000
                                       -----------          -----------          -----------          -----------

OPERATING (LOSS)                          (565,000)            (702,000)          (1,030,000)            (965,000)

OTHER INCOME (EXPENSE):
    Interest, net                           12,000               24,000               (4,000)            (246,000)
    Other                                   (5,000)               2,000               (5,000)               1,000
                                       -----------          -----------          -----------          -----------
         Other, Net                          7,000               26,000               (9,000)            (245,000)
                                       -----------          -----------          -----------          -----------
NET (LOSS)                             $  (558,000)         $  (676,000)         $(1,039,000)         $(1,210,000)
                                       ===========          ===========          ===========          ===========

NET LOSS PER SHARE (Basic)             $      (.16)         $      (.24)         $      (.30)         $      (.50)
NET LOSS PER SHARE (Diluted)           $      (.16)         $      (.24)         $      (.30)         $      (.50)
                                       ===========          ===========          ===========          ===========

WEIGHTED AVERAGE COMMON
 SHARES AND EQUIVALENTS
 OUTSTANDING                             3,585,000            2,805,000            3,410,000            2,437,000
                                       ===========          ===========          ===========          ===========


                               See accompanying notes to these financial statements.

                                                        4
</TABLE>

<PAGE>
<TABLE>
<CAPTION>

                                    NAVIDEC, INC.
                              STATEMENTS OF CASH FLOWS

                                                            FOR THE SIX MONTHS ENDED
                                                                    JUNE 30
                                                           --------------------------
                                                               1998           1997
                                                               ----           ----
CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                        <C>            <C>         
    Net loss                                               $(1,039,000)   $(1,210,000)
    Adjustments to reconcile net loss to net
     cash used in operating activities:
          Depreciation and amortization                        307,000        184,000
                Accounts receivable                           (318,000)      (631,000)
                Costs and estimated earnings in
                   excess of billings                         (197,000)      (133,000)
                Inventories                                    197,000       (178,000)
                Other assets                                    (8,000)      (185,000)
             Increase (decrease) in:
                Accounts payable and accrued liabilities        23,000       (438,000)
                Other liabilities                               69,000
                                                           -----------    -----------
      Net cash used in operating activities                   (966,000)    (2,591,000)

CASH FLOWS FROM INVESTING ACTIVITIES:
    Decrease (increase) in Notes Receivable                     24,000        (30,000)
    Capital expenditures for property and equipment           (430,000)       (64,000)
                                                           -----------    -----------
      Net cash used in investing activities                   (406,000)       (94,000)

CASH FLOWS FROM FINANCING ACTIVITIES:
    Proceeds from factoring of accounts receivable             752,000        240,000
    Payment to factor                                         (846,000)      (532,000)
    Proceeds from issuance of common stock                   1,551,000      5,115,000
    Proceeds from issuance of notes payable                       --          300,000
    Proceeds from notes payable -related parties                40,000
    Payment on notes payable-related parties                   (40,000)
    Payment on notes payable and capital leases                (47,000)    (1,202,000)
                                                           -----------    -----------
       Net cash provided by financing activities             1,410,000      3,921,000

INCREASE IN CASH AND CASH EQUIVALENTS                           38,000      1,236,000

CASH AND CASH EQUIVALENTS,
      beginning of period                                      369,000        231,000
                                                           -----------    -----------
CASH AND CASH EQUIVALENTS, end of period                   $   407,000    $ 1,467,000
                                                           ===========    ===========
SUPPLEMENTAL SCHEDULE OF CASH
FLOW INFORMATION:
    Cash payments for interest                             $    18,000    $   231,000
                                                           ===========    ===========

Debentures converted to common stock                       $      --      $ 1,437,000
                                                           ===========    ===========

                See accompanying notes to these financial statements.

                                         5
</TABLE>

<PAGE>


                          NOTES TO FINANCIAL STATEMENTS
                          -----------------------------


     UNAUDITED FINANCIAL STATEMENTS

     The  unaudited  financial  statements  and related  notes to the  financial
     statements  presented  herein have been prepared by the Company pursuant to
     the  rules and  regulations  of the  Securities  and  Exchange  Commission.
     Accordingly, certain information and footnote disclosures normally included
     in financial  statements  prepared in accordance  with  generally  accepted
     accounting  principles  have  been  omitted  pursuant  to  such  rules  and
     regulations.   The  accompanying  financial  statements  were  prepared  in
     accordance  with the  accounting  policies used in the  preparation  of the
     Company's  audited  financial  statements  included in its Annual Report on
     Form 10-KSB for the fiscal year ended December 31, 1997, and should be read
     in conjunction with such financial statements and notes thereto.

     In the opinion of management,  all adjustments  (consisting  only of normal
     recurring  adjustments)  which are  necessary  for a fair  presentation  of
     operating results for the interim periods presented have been made.

     STOCKHOLDERS' EQUITY

     Public  Stock  Offering - On February 14,  1997,  the Company  completed an
     initial  public stock offering of 1,000,000  Units  (comprised of 1,000,000
     shares of common stock and warrants for the purchase of 1,000,000 shares of
     common stock) which provided gross proceeds to the Company of approximately
     $4,555,000.  Simultaneous with the offering  convertible  debenture holders
     converted  $1,438,000 in convertible  notes into common stock and warrants.
     Included in the 1,000,000  Units are 245,000 shares of common stock offered
     by the holders of the unsecured subordinated  convertible promissory notes.
     Each warrant  allows the holder to purchase one share of common stock at an
     exercise  price of $7.20 for a period of five  years  after the date of the
     offering.  The warrants are  redeemable  by the Company at $.05 per warrant
     upon  30 days  notice  if the  market  price  of the  common  stock  for 20
     consecutive  trading days within the 30-day  period  preceding the date the
     notice is given  equals or  exceeds  $8.40.  The  Company  also sold to the
     underwriter at the close of the public offering underwriters warrants, at a
     price of $0.001 per  warrant,  to purchase  100,000  shares of common stock
     exclusive of the over-allotment.  The underwriters warrants are exercisable
     for 4 years beginning in February 1998 at $7.38 per share.

     Stock Split - During  1996,  the Company  declared a 1 for 2 reverse  stock
     split and 510.2041 to 1 stock split.  The Company also declared a .85 for 1
     reverse stock split which became effective upon the initial public offering
     in February  1997. All common stock  reflected in the financial  statements
     and accompanying notes reflect the effect of the split and reverse split.

     Private  Placement - From November 1997 to April 1998,  the Company  raised
     additional  capital in a private  placement  offering  of 594,500  units at
     $4.50 per unit  (comprised  of 594,500  shares of common stock and warrants
     for the purchase of 594,500  shares of common stock) which  provided  gross
     proceeds to the Company of  approximately  $2,229,750.  Each warrant allows
     the holder to purchase  one share of common  stock at an exercise  price of
     $7.20 for a period  extending  through  February 10, 2002. The warrants are
     redeemable  by the Company at $.05 per  warrant  upon 30 days notice if the
     market price of the Company's common stock for 20 consecutive  trading days
     within the 30 day period  preceding  the date the notice is given equals or
     exceeds  $8.40.  Offering  costs  associated  with  the  private  placement
     included sales commissions and non-accountable expenses totaling 13% of the
     proceeds of the offering,  as well as placement  agent warrants to purchase
     59,450  units for 5 years from the date of  closing  at $4.50 per unit.  In
     addition,  the Company  agreed to issue any broker or registered  agent who
     placed four or more units  (consisting  of 6,000 units or $27,000 each) one
     broker warrant for each $20 sold.  During the private placement the Company
     issued 121,613 warrants to brokers or registered agents.  This offering was
     made pursuant to Rule 506 of Regulation D under the Securities Act of 1933,
     as amended,  as an offering not  involving  any public  offering  solely to
     accredited and not more than 35 sophisticated investors.

                                       6
<PAGE>


COMPREHENSIVE INCOME

     In June, 1997 the Financial  Accounting Standards Board issued Statement of
     Financial Accounting Standards No 130, Reporting Comprehensive Income ("FAS
     130").  FAS 130,  which is  effective  for  fiscal  years  beginning  after
     December  15,  1997,  defines   comprehensive  income  as  all  changes  in
     shareholder  equity exclusive of transactions with owners,  such as capital
     investments.  Comprehensive  income includes net income or loss, changes in
     certain assets and liabilities that are reported directly in equity such as
     translation adjustments on investments in foreign subsidiaries, and certain
     changes in minimum pension liabilities.  The Company's comprehensive income
     (loss)  was  equal to its net  income  (loss)  for the  three and six month
     periods ended June 30, 1998 and 1997.

     NOTES PAYABLE

     Notes payable at June 30, 1998, consists of the following:

     Note payable to a bank, interest at prime plus 1/2% (8.75% as of
     March 31, 1998) and principal payments of $5,000 payable monthly
     with remaining principal paid upon maturity in June 2002,
     collateralized by a CD owned by the company.                       $245,000

     Note payable to officer/director /shareholder,
     principal along with interest at 10% per annum
     due on December 31, 1998.                                           $ 3,000

SUBSEQUENT EVENTS

     On August 5, 1998, the Company  announced that is signed a letter of intent
     to merge with VSI  Holdings  Inc.  (AMEX:VIS).  VSIH is  comprised  of five
     wholly owned subsidiaries  focused on marketing and entertainment,  and has
     1,250 employees in the U.S. and Canada.  The five  integrated  subsidiaries
     provide  technology and systems for relationship  marketing,  entertainment
     products,  education  and training for clients such as Ford Motor  Company,
     General Motors,  Schering Plough  Pharmaceuticals and Universal Studios. It
     is expected that the merger will create a large  Internet/new media company
     with  the  capability  to  provide   comprehensive   integrated  technology
     applications  for  marketing  and  e-commerce.  Annual  revenues of the new
     company are expected to exceed $170 million.

     It is  anticipated  that the merger will  involve an exchange of the common
     stock of the two  companies  and be accounted  for on a pooling of interest
     basis. The  consummation of the merger is subject to due diligence  review,
     negotiation  of  a  definitive   agreement,   tax-free  status  compliance,
     preparation  of filings with the Securities  and Exchange  Commission,  and
     approval by the  shareholders of both companies.  The merger is expected to
     close in the fourth quarter of 1998.


                                       7

<PAGE>

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


     Cautionary  Statement  Regarding  Forward Looking  Statements.  The matters
discussed here and elsewhere in this report,  when not historical  matters,  are
forward looking statements that involve a number of risks and uncertainties that
could cause actual results to differ  materially  from projected  results.  Such
factors include,  among other things,  the rapidly  developing and unpredictable
nature of the Internet,  intense  competition  in all of the Company's  markets,
obsolescence of products and technological  changes,  the need for management of
growth and the dependence on relationships of the Company with its customers and
suppliers,  as well as other risk  factors  described  elsewhere in this report.

Overview

     The Company was organized as ACI Systems, Inc. in July 1993 and changed its
name to NAVIDEC,  Inc. in July 1996 when it acquired  Interactive  Planet,  Inc.
("IPI"),  a designer  and  developer  of  Internet  World  Wide Web  sites.  The
Company's  principal  sources  of  revenue  are  from  the  resale  of  computer
equipment, high technology peripherals and electronic components manufactured by
independent   vendors   (Product   Distribution)   and   services   related   to
Internet/Intranet  Solutions,  license fees from recurring lead revenue from the
Wheels  solution.  The Company  issued an aggregate of 678,877  shares of Common
Stock to the  shareholders of IPI and a promissory note in the amount of $75,000
to one  shareholder  of IPI in  exchange  for all of the issued and  outstanding
stock of IPI. The Company  acquired  TouchSource,  Inc.  ("TS"),  a designer and
developer of interactive  Kiosks,  in July 1997. The Company issued an aggregate
of 207,000  shares of Common Stock to the  shareholders  of TS and TS was merged
into the Company in exchange for all of the issued and outstanding  stock of TS.
The merger and  acquisition  were  consummated  in order to expand the Company's
business model of combined  expertise in traditional  marketing and distribution
and Internet/ Intranet technology. On August 5, 1998 the Company signed a letter
of intent to merge with VSI Holdings  ("VSIH")(VIS:AMEX) in an anticipated stock
for stock  exchange that is scheduled to be completed  during the fourth quarter
of  1998.  VSIH is  comprised  of five  wholly  owned  subsidiaries  focused  on
marketing and entertainment, and has 1,250 employees in the U.S. and Canada. The
five integrated  subsidiaries  provide  technology and systems for  relationship
marketing,  entertainment  products,  education and training for clients. Annual
revenues  of  the  new  company  are  expected  to  exceed  $170  million.   The
consummation of the merger is subject to due diligence review,  negotiation of a
definitive  agreement,  tax-free status compliance,  preparation of filings with
the Securities and Exchange Commission, and approval by the shareholders of both
companies.

     The  Company's  strategy is to increase  revenue  generated by its two core
competencies:  (1) Internet/Intranet  Solutions, which are focused in five major
market areas, including computer and network infrastructure equipment,  software
and services,  content  aggregation,  electronic commerce and order fulfillment,
and (2) Product  Distribution.  The Company has built and intends to continue to
build an  infrastructure  that assumes this strategy  will  succeed.  Management
believes  that,  based on the current  product  mix,  the  Company's  new Wheels
solution will  provided for the majority of its  increased  revenues in 1998 and
years  to  follow.   The  Wheels  solution   combines  the  company's  two  core
competencies of Internet/Intranet solutions and product distribution.  Wheels is
designed on a state of the art platform that allows it to distribute  electronic
information  out to  consumers  through  regional  wheels web sites,  individual
dealer web sites, remote automotive kiosks and also in mobile sales laptops. The
failure of the Company to achieve this  strategy  could have a material  adverse
effect on the Company's business, financial condition and results of operations.

     The Company  recognizes  revenue  upon  delivery  of its  Internet/Intranet
Solutions and Product Distribution goods.  Internet/Intranet Solutions generally
begin  with  consulting  arrangements  that are  billed on an  hourly  basis and
progress  to a bid  for  a  proposed  project.  Deposits  are  then  taken  upon
acceptance  of the bid.  Most of the  Company's  customers  elect to update  and
expand their Web sites frequently,  and clients are billed monthly on a time and
materials  basis for these  services.  Additional  sources  of  ongoing  revenue
include  revenue  from  advertising  sold by the  Company on clients  Web sites,
revenue  from sales of  merchandise  and  services  over  clients  Web sites and
revenue from maintenance and hosting of client Web sites.

                                       8
<PAGE>


     From August  through  October,  1996,  the Company  raised net  proceeds of
approximately $1,233,000 from the sale of 10% Unsecured Subordinated Convertible
Promissory  Notes (the "Bridge  Promissory  Notes") in a private  placement (the
"Bridge Private  Placement").  These notes were converted by their terms into an
aggregate of 349,126 Units upon  consummation  of the Company's  public offering
described  below.  The Units were  identical to the Units  offered in the public
offering.

     On  February  14,  1997,  the  Company  consummated  a public  offering  of
1,000,000  Units  consisting  of one share of Common  Stock and one Common Stock
purchase warrant  ("Warrant").  Each Warrant entitles the holder to purchase one
share of Common Stock at a price of $7.20 per share until February 10, 2002. The
Warrants are  redeemable at the option of the Company,  at $.05 per Warrant,  at
any time on or after February 10, 1998 or such earlier date as may be determined
by Joseph Charles & Associates  ("JCA"). Of the 1,000,000 shares of Common Stock
and 1,000,000 Warrants included in the offering,  755,000 shares of Common Stock
and  1,000,000  Warrants  were  sold  by  the  Company,   for  net  proceeds  of
approximately  $3,436,000 (after subtracting the underwriting discount and other
expenses of the  offering).  The remaining  255,000  shares of Common Stock were
sold by the investors in the Bridge Private Placement.

     From  November  1997 to April  1998,  the  Company  raised net  proceeds of
approximately  $2,229,750  from the issuance of 594,500  shares of commons stock
and  warrants  in a private  placement.  Each  Warrant  entitles  the  holder to
purchase one share of Common Stock at a price of $7.20 per share until  February
10, 2002. The Warrants are redeemable at the option of the Company,  at $.05 per
Warrant,  at any time on or after  February 10, 1998 when the  Company's  Common
Stock on 20  consecutive  trading days has closing  market price above $8.40 per
share  and  there  is an  effective  registration  statement  on file  with  the
Securities and Exchange Commission.

Results of Operations

     The following tables set forth for the periods  indicated the percentage of
net sales represented by certain line items included in the Company's statements
of operations.
<TABLE>
<CAPTION>

                             Three Months Ended                                  Six Months Ended
                                   June 30                                           June 30
                ----------------------------------------------    ----------------------------------------------
                         1998                     1997                   1998                      1997
                         ----                     ----                   ----                      ----
<S>             <C>              <C>     <C>              <C>     <C>              <C>     <C>              <C> 
Net Sales       $ 1,837,000      100%    $ 1,589,000      100%    $ 3,539,000      100%    $ 2,952,000      100%
COGS              1,284,000       70%      1,069,000       67%      2,339,000       66%      1,926,000       65%
Gross Profit        553,000       30%        520,000       33%      1,200,000       34%      1,026,000       35%
Oper Expenses     1,118,000       61%      1,222,000       77%      2,230,000       63%      1,991,000       67%
Oper (Loss)        (565,000)     (31%)      (702,000)     (44%)    (1,030,000)     (29%)      (965,000)     (33%)
Other                 7,000        0%         26,000        2%         (9,000)      (0%)      (245,000)      (8%)
Net (Loss)         (558,000)     (30%)      (676,000)     (43%)    (1,039,000)     (29%)    (1,210,000)     (41%)
</TABLE>


     Net sales for the six months  ended  June 30,  1998 were  $3,539,000  which
represents  an  increase of 20% over net sales of  $2,952,000  for the first six
months of 1997.  Net sales were  $1,837,000  for the three months ended June 30,
1998 an increase of 16% over sales of  $1,589,000  for the three  months  ending
June  30,   1997.   The   increase   is   primarily   attributed   to  sales  of
Internet/Intranet  Solutions, which were $1,275,000 an increase of 101% over net
sales of $634,000 during the first six months of 1997.  Internet/Intranet  sales
were $661,000 for the quarter ending June 30, 1998 an increase of 96% over sales
of $338,000 for the quarter ending June 30, 1997.  Sales of the Company's Wheels
solution, which was introduced in the 4th quarter of 1997 accounted for $504,000
or 40% of the  Internet/Intranet  sales  for the first  six  months of 1998.  In
addition, net sales of Internet  Infrastructure was $1,068,000 for the first six
months of 1998 an increase of 24% over net sales of $859,000  for the six months
ending  June 30,  1997.  Internet  Infrastructure  sales were  $529,000  for the
quarter  ending  June 30,  1998 an increase of 16% over net sales of 457,000 for
the  quarter  ending  June 30,  1997.  The  increase  in net  sales in all three
categories  was primarily  attributable  to increased  marketing  activities and
greater market penetration.

     Net sales in Distribution  were $1,196,000 for the first six months of 1998
a decrease  of 18% from net sales of  $1,459,000  during the first six months of
1997.  Net sales in  Distribution  were $657,000 for the three months ended June
30, 1998 a decrease of 17% from net sales of $792,000 for the three months ended
June 30, 1997.  The decrease in sales is  attributed to the  discontinuation  of
distribution  products  that did not have strong  gross  profit and or recurring
sales.

     Gross  margin was 34% during six months of 1998,  an  decrease of 1% over a
gross margin of 35% during the same period in 1997.  The Company's  gross margin
continues to remain strong which is attributed to  management's  elimination  of
several distribution products that carried low gross margin and the strong gross
margin on Internet/Intranet Solutions.

                                       9
<PAGE>


     Operating  expenses for the first six months of 1998 were $2,230,000 or 63%
of sales  compared  with  $1,991,000  or 67% for the same  period  in 1997.  The
increase in operating  expenses was primarily the result of an increase in staff
and marketing  activities  associated  with expanding the Wheels product and its
market area.  Operating  expenses  are expected to remain  stable as the Company
continues to invest in the development of high end Internet/Intranet Solutions.

     Net interest  expense for first six months of 1998 was $9,000 compared with
$245,000  for the first six  months of 1997.  The  decrease  was a result of the
Bridge  Promissory  Notes that were  converted in February of 1997.  The Company
expects interest expense to remain constant for the remainder of 1998.

Liquidity and Capital Resources

     Through March 31, 1998, the Company funded its operations primarily through
equity investments, from the Company's IPO and subsequent Private Placement that
was completed in April of 1998 , and revenues  generated from operations,  lines
of credit and factoring  arrangements made available to it by banks. On June 30,
1998 the Company  had cash and cash  equivalents  of $407,000  and a net working
capital of $1,020,000  compared to cash and cash  equivalents  of $369,000 and a
net working capital of $678,000 as of December 31, 1997.

     Cash used in  operating  activities  for the Company  totaled  $966,000 and
$2,591,000  for first six  months of 1998 and 1997,  respectively.  Cash used in
investing  activities  consisted of  expenditures  for  property and  equipment.
Capital  expenditures  increased  to  $430,000  in first six months of 1998 from
$94,000 during first six months of 1997.

     Cash from  financing  activities in fiscal 1998  consisted of advances from
factoring arrangements of $752,000 net of repayments of $846,000,  proceeds from
the issuance of common stock of $1,551,000.  This compares to 1997 repayments of
Notes of $1,437,000  from the Bridge Private  Placement,  $226,000 in loans from
shareholders and employees and $71,00 in repayment of factoring arrangements.

     The Company has not recorded a deferred tax asset as it cannot  conclude to
date  that it is more  likely  than not  that the  deferred  tax  asset  will be
realized.

Year 2000

     Management  has  initiated  an  enterprise-wide   program  to  prepare  the
Company's  computer  systems  and  applications  for the year 2000.  The Company
expects to incur  internal  staff cost as well as consulting  and other expenses
related to the year 2000  project.  At this  point,  the  Company is not able to
determine  the  estimated  cost for its year 2000  project  and, if  unresolved,
whether the year 2000 issue will have a material impact on the operations of the
Company.



PART II - OTHER INFORMATION
---------------------------

Item 1.  Legal Proceedings
         None

Item 2.  Changes in Securities
         See "Notes to Financial Statements - Private Placement"

Item 3.  Defaults Upon Senior Securities
         None

Item 4.  Submission of Matters to a Vote of Security Holders

     On June 24, 1998, the Annual Meeting of Shareholders  of NAVIDEC,  Inc. was
held. At that meeting,  the following  matters were approved by the shareholders
by the votes indicated below:

     1)   The following directors were elected to constitute the entire Board of
          Directors of the Company:

                                Shares for         Shares Withhold
        Ralph Armijo            2,232,276                 4,550
        Andrew Davis            2,128,576               108,250
        Patrick R Mawhinney     2,125,026               110,280
        Lloyd G. Chavez Jr.     2,128,576               108,250
        Gerald A Marroney       2,128,576               108,250
        James Hosch             2,128,576               108,250

                                       10
<PAGE>


     2)   A proposal to adopt the Company's Stock Option Plan received 1,440,683
          shares  voting in favor of the proposal,  6,000 shares voting  against
          the proposal, and 11,006 shares abstaining.

     3)   A proposal to authorize the company to issue in a non-public  offering
          up  to  1,000,000   shares  of  the  Company's  common  stock  for  an
          approximate  aggregate offering price of $6 million received 2,213,037
          shares voting in favor of the proposal,  18,783 shares voting  against
          the proposal, and 5,006 shares abstaining.

     4)   A proposal to ratify the selection by the Board of Directors of Hein +
          Associates LLP as the independent certified public accountants for the
          Company for the fiscal year ending December 31, 1998 was approved with
          a total of 2,226,520  shares  voting in favor of the  proposal,  1,300
          shares voting against the proposal and 9,006 shares abstaining.


Item 5. Other Information

     On August 5, 1998, the Company  announced that is signed a letter of intent
     to merge with VSI  Holdings  Inc.  (AMEX:VIS).  VSIH is  comprised  of five
     wholly owned subsidiaries  focused on marketing and entertainment,  and has
     1,250 employees in the U.S. and Canada.  The five  integrated  subsidiaries
     provide  technology and systems for relationship  marketing,  entertainment
     products,  education  and training for clients such as Ford Motor  Company,
     General Motors,  Schering Plough  Pharmaceuticals and Universal Studios. It
     is expected that the merger will create a large  Internet/new media company
     with  the  capability  to  provide   comprehensive   integrated  technology
     applications  for  marketing  and  e-commerce.  Annual  revenues of the new
     company are expected to exceed $170 million.

     It is  anticipated  that the merger will  involve an exchange of the common
     stock of the two  companies  and be accounted  for on a pooling of interest
     basis. The  consummation of the merger is subject to due diligence  review,
     negotiation  of  a  definitive   agreement,   tax-free  status  compliance,
     preparation  of filings with the Securities  and Exchange  Commission,  and
     approval by the  shareholders of both companies.  The merger is expected to
     close in the fourth quarter of 1998.


Item 6. Exhibits and Reports on Form 8-K

     (a)  Exhibits.
          The exhibits  included in the  Company's  Annual Report on Form 10-KSB
          for the fiscal year ended December 31, 1997.

     27   Financial Data Schedule

     (b)  Reports on Form 8-K

          During the quarter  ended June 30, 1998,  the Company filed one report
          on a form 8-K on April 19, 1998 reporting  under Item 5 the closing of
          the Company's private placement of securities and providing under Item
          7 the Company financial statement as of April 30, 1998.


                                       11
<PAGE>



PART III. SIGNATURES
--------------------

Item 1. Signatures

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



                                            NAVIDEC, INC.
                                            -------------



Date:  August 14, 1998

                                    By      /S/ RALPH ARMIJO
                                            Ralph Armijo
                                            President and CEO


                                    By      /S/ PAT MAWHINNEY
                                            Pat Mawhinney
                                            Chief Financial Officer