SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 10-Q
                    QUARTER REPORT UNDER SECTION 13 0R 15(d)


                
Quarter Ended  6-30-98  Commission File Number____________

                              World Services, Inc.
       -----------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

          South Dakota                                          46-0355586
--------------------------------------------------------------------------------
(State of other jurisdiction of                             (I.R.S. Employer
 incorporation or organization)                              Identification No.)

                     PO Box 786 Aberdeen, South Dakota 57402
       -----------------------------------------------------------------
              (Address if principal executive offices) (Zip Code)

                                 (605) 225-4131
                                 --------------
               Registrant's telephone number, including area code

                                 Not Applicable
       -----------------------------------------------------------------
              (Former name, former address and former fiscal year,
                         if changed since last report.)

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

Yes  X    No______

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock as of the close of the period covered by this report.

As of June 30,  1998,  Registrant  had  2,639,679  shares of its $.001 par value
common stock outstanding.


<PAGE>


                                      INDEX


PART I.   FINANCIAL INFORMATION:

Item 1.   Balance Sheet as of June 30, 1998 ..................       1

          Statements of Operations for Quarters Ended
          June 30, 1998 and 1997 .............................       2

          Statements of Operations for the Six Months
          Ended June 30, 1998 and 1997 .......................       3

          Statements of Cash Flows for the Six Months
          Ended June 30, 1998 and 1997 .......................       4

          Notes to Financial Statements ......................       5

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

          Liquidity and Capital Resources ....................       6

          Results of Operations ..............................       7


PART II.  OTHER INFORMATION:

Item 1.   Legal Proceedings ..................................       8

Item 2.   Changes in Securities ..............................       8

Item 3.   Default Upon Senior Securities .....................       8

Item 4.   Submission of matters to a Vote of Security
          Holders ............................................       8

Item 5.   Other Information ..................................       9

Item 6.   Exhibits and Reports on Form 10-Q ..................       9


<PAGE>


                              WORLD SERVICES, INC.
                                  BALANCE SHEET
                                 June 30, 1998


                                     ASSETS
                                     ------
CURRENT ASSETS                
  Cash                                                         $     108,955.74
  Certificates of Deposit                                            430,000.00
  Interest Receivable                                                 11,386.00
                                                               ----------------
     TOTAL CURRENT ASSETS                                            550,341.74

INVESTMENTS AND OTHER ASSETS
  United States Treasury Note                                        413,846.28
  Investment-Super 8 Developers                                      568,000.00
                                                               ----------------
TOTAL OTHER ASSETS                                                   981,846.28
                                                               ----------------
TOTAL ASSETS                                                   $   1,532,188.02
                                                               ================


                      LIABILITIES AND STOCKHOLDERS EQUITY
                      -----------------------------------


CURRENT LIABILITIES
  Accounts Payable                                             $      22,376.28
  Stock Redemption payable                                            67,806.50
                                                               ----------------
         TOTAL CURRENT LIABILITIES                                    90,182.78

STOCKHOLDERS EQUITY
  Common stock, par value $.001 per
         share; (50,000,000 shares
         authorized)with
         2,640,000 shares issued                                       2,715.00
  Additional paid in capital                                       6,364,354.75
  Accumulated Deficit                                             (4,925,064.51)
                                                               ----------------
     TOTAL STOCKHOLDERS' EQUITY                                    1,442,005.24
                                                               ----------------
TOTAL LIABILITIES AND
  STOCKHOLDERS' EQUITY                                         $   1,532,188.02
                                                               ================

                                       1
<PAGE>



                              WORLD SERVICES, INC.
                            STATEMENTS OF OPERATIONS
                 For the Quarters Ended June 30, 1998 and 1997


                                                    1998              1997
                                                    ----              ----
REVENUE
  Dividend Income                             $     159,390.40  $     239,085.60
  Interest Income                                    13,296.28         24,857.51
  Stock Transfer Fees                                     0.00             19.50
  Undistributed Income/Loss                               0.00         37,000.00
                                              ----------------  ----------------
     TOTAL REVENUE                                  172,686.68        300,962.61
                                              ----------------  ----------------

EXPENSES
  Accounting Fees                                     5,486.38          8,615.80
  Contract Wages & Consulting                        22,584.10          1,720.00
  Faxes                                                  51.00            139.50
  Legal Fees                                         10,179.22         16,176.60
  Director Fees                                         750.00          1,950.00
  Office Supplies                                       264.80              0.00
  Printing                                              545.00            982.35
  Postage                                             1,501.08            333.45
  Supplies                                               18.32            182.66
  Telephone                                              47.51             39.75
  Rent                                                  500.00          1,820.00
  Travel                                                  0.00            447.80
  Loss on Uncollectible Note                          4,000.00              0.00
                                              ----------------  ----------------
         TOTAL EXPENSES                              45,927.41         32,407.91
                                              ----------------  ----------------

INCOME BEFORE INCOME TAXES                          126,759.27        268,554.70

INCOME TAXES                                              0.00              0.00
                                              ----------------  ----------------
NET INCOME                                    $     126,759.27  $     268,554.70
                                              ================  ================

INCOME PER SHARE (Basic & Diluted)                         .04               *
                                              ================  ================
WEIGHTED AVERAGE COMMON
 SHARES OUTSTANDING                               2,640,000         5,229,907
                                              ================  ================
* Less than $0.01 per share 

                                       2

<PAGE>



                              WORLD SERVICES, INC.
                            STATEMENTS OF OPERATIONS
                 For the Six Months ended June 30, 1998 and 1997

                                                    1998               1997
                                                    ----               ----
REVENUE
  Dividend Income                             $     159,390.40  $     239,085.60
  Interest Income                                    16,459.04         24,857.51
  Stock Transfer Fees                                     0.00             39.75
  Undistributed Income/Loss                               0.00         37,000.00
                                              ----------------  ----------------
     TOTAL REVENUE                                  175,849.44        300,982.86
                                              ----------------  ----------------

EXPENSES
  Accounting Fees                                     9,149.94          8,615.80
  Contract Wages & Consulting                        25,803.10          2,640.00
  Faxes                                                 123.00            139.50
  Legal Fees                                         11,596.97         27,463.20
  Director Fees                                       2,100.00          3,150.00
  Office Supplies                                       401.28            119.35
  Printing                                              545.00            982.35
  Postage                                             1,760.45            411.50
  Supplies                                              238.32            201.73
  Telephone                                             156.47             44.12
  Rent                                                1,250.00          1,820.00
  Travel                                                  0.00            447.80
  Miscellaneous Expense                                 308.00              0.00
  Loss on Uncollectible Note                          4,000.00              0.00
                                              ----------------  ----------------
         TOTAL EXPENSES                              57,432.53         46,035.35
                                              ----------------  ----------------

INCOME BEFORE INCOME TAXES                          118,416.91        254,947.51

INCOME TAXES                                              0.00              0.00
                                              ----------------  ----------------
NET INCOME/COMPREHENSIVE INCOME               $     118,416.91  $     254,947.51
                                              ================  ================

INCOME PER SHARE (Basic & Diluted)                         .04             *
                                              ================  ================
WEIGHTED AVERAGE COMMON
 SHARES OUTSTANDING                               2,640,000         5,229,907
                                              ================  ================
* Less than $0.01 per share 


                                       3
<PAGE>



                              WORLD SERVICES, INC.
                            STATEMENTS OF CASH FLOWS
                For the Six Months Ended June 30, 1998 and 1997


                                                      1998             1997
                                                      ----             ----
CASH FLOWS FROM OPERATING ACTIVITIES
    Net Income/Comprehensive Income              $   118,416.91  $   254,947.51

  Adjustment to reconcile net income to
    net cash used in operating
     activities:
     Equity in Earning of Affiliates                       0.00      (37,000.00)
     (Increase) Decrease in:
      Interest Receivable                              8,658.46            0.00
      Other Assets                                   (10,357.85)       1,832.50
    Increase (Decrease) in:  
      Accounts Payable                                22,376.28        7,639.70
      Stock Redemption Payable                        (5,589.50)           0.00
                                                 --------------  --------------
         NET CASH PROVIDED BY OPERATING
          ACTIVITIES                                 133,504.30      227,419.71
                                                 --------------  --------------
CASH FLOWS FROM INVESTING ACTIVITIES
         Purchase of Certificates of Deposit         (90,000.00)    (200,000.00)
                                                 --------------  --------------
         NET CASH USED BY INVESTING
          ACTIVITIES                                 (90,000.00)    (200,000.00)
                                                 --------------  --------------

         NET INCREASE IN CASH                         43,504.30       27,419.71

CASH AT BEGINNING OF PERIOD                           65,451.44       27,652.56
                                                 --------------  --------------
CASH AT END OF PERIOD                            $   108,955.74  $    55,072.27
                                                 ==============  ==============
SUPPLEMENTAL DISCLOSURES 
  Cash payments for:
    Income taxes                                 $         0.00  $         0.00
                                                 ==============  ==============
    Interest paid                                $         0.00  $         0.00
                                                 ==============  ==============

                                       4
<PAGE>



                              WORLD SERVICES, INC.

                         NOTES TO FINANCIAL STATEMENTS
                       FOR THE PERIOD ENDED JUNE 30, 1998


In the  opinion of  management  of World  Services,  Inc.,  (the  Company),  the
accompanying unaudited financial statements reflect all adjustments  (consisting
of only normal  recurring  accruals)  necessary to present  fairly the financial
position of the company as of June 30, 1998,  and the results of operations  and
Statements of Cash Flows for the six months ended June 30, 1998 and 1997.

These  unaudited  financial  statements  should be read in conjunction  with the
Company's annual report on Form 10-KSB for the year ended December 31, 1997.



NOTE 1 - NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES
--------------------------------------------------------------------------------

A summary of  significant  accounting  policies  is  currently  on file with the
Securities and Exchange Commission on Form 10-KSB.


NOTE 2 - INCOME TAXES
--------------------------------------------------------------------------------

As of December 31, 1997,  the Company had net operating  loss carry forwards for
income tax purposes totaling approximately  $3,100,000 which expire in the years
1998 to 2011.  The net operating loss carry forwards may be limited with respect
to their availability due to prior ownership changes and the consolidated return
regulations.  In addition,  there are  investment  tax credit carry  forwards of
$28,000.

                                       5

<PAGE>



                              WORLD SERVICES, INC.

                    MANAGEMENTS'S DISCUSSION AND ANALYSIS OF
                 FINANCIAL CONDITION AND RESULTS OF OPERATIONS


The following  discussion and analysis  should be read in  conjunction  with the
Financial Statements and Notes thereto appearing elsewhere in this report.

LIQUIDITY AND CAPITAL RESOURCES - JUNE 30, 1998, COMPARED TO DECEMBER 31, 1997
--------------------------------------------------------------------------------

During the six months ended June 30, 1998, cash increased  approximately $43,500
as a result of the receipt of a dividend of approximately $160,000 received from
Super 8 Motels less the purchase of a $90,000  certificate  of deposit  which is
now held by the Company.

Interest  receivable  decreased from $20,044 at December 31, 1997, to $11,386 at
June 30, 1998.

Primarily  as a result of the  receipt  of the Super 8 Motel  Dividend,  current
assets increased by $124,846, from $425,496 at December 31, 1997, to $550,342 at
June 30, 1998.

Current  liabilities  increased  $16,787,  from $73,396 at December 31, 1997, to
$90,183 at June 30, 1998.  The  increase is the result of payables  accrued near
the end of the quarter including $8,099 owed to Murray Woulfe as a result of the
outcome of prior pending  litigation  and $11,000 due Ronne Tarrell for contract
services.

As a result of the  Company's  net income for the six  months of  $118,417,  the
accumulated   deficit  decreased  from  $5,043,481  at  December  31,  1997,  to
$4,925,065 at June 30, 1998. As a result,  total  stockholders  equity increased
from 1,323,588 at December 31, 1997, to $1,442,005 at June 30, 1998.

In August of 1997,  the Company  completed a reverse  stock split  followed by a
forward stock split.  Following the reverse stock split,  there were a number of
fractional shares which were redeemed. Not all of the fractional shares had been
submitted  for payment by December 31, 1997 or June 30, 1998.  As a result,  the
'current  liabilities' portion of the balance sheet reflects a "stock redemption
payable."  During  the six months  ended June 30,  1998,  the  Company  redeemed

                                       6
<PAGE>


                              WORLD SERVICES, INC.

                    MANAGEMENTS'S DISCUSSION AND ANALYSIS OF
                 FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                                  (Continued)

outstanding  fractional shares with a value of approximately  $5,600.  The total
number of outstanding shares of common stock reflected on the balance sheet does
not give any effect to the fractional shares outstanding.

RESULTS OF  OPERATIONS  - SIX MONTHS  ENDED JUNE 30,  1998  COMPARED  TO THE SIX
MONTHS ENDED JUNE 30, 1997
--------------------------------------------------------------------------------

Total revenue for the six months ended June 30, 1998,  were $175,849 as compared
to  $300,983  for the  comparable  period  ended June 30,  1997,  a decrease  of
$125,133. The decrease is due to the sale in October 1997 of the First Savings &
Loan  investment.  This  decreased  dividend  income  and also  decreased  their
undistributed income by $37,000.

Operating expenses were $57,433 for the six months ended June 30, 1998, compared
to $46,035 for the comparable period ended June 30 1997, an increase of $11,397.
The majority of this increase was in contract wages and consulting including the
cost of payment to Murray  Woulfe as a result of the  negative  consequences  of
litigation.

Based on the foregoing,  the net income  available to  stockholders  for the six
months ended June 30, 1998, was  $118,416.91,  which  translates to a net income
per  share  of less  than  $0.01  based on  2,640,000  weighted  average  shares
outstanding.  This  compares  to the net income  after  taxes for the six months
ended June 30, 1997, of $254,948,  which translates to a net income per share of
less than $0.01 based on 5,229,907  weighted average shares  outstanding at that
time.

The  weighted  average  number of shares has been  adjusted  for the reverse and
forward stock splits  completed in August of 1997 and for the  repurchase of the
fractional  shares  resulting from the reverse stock split,  all as described in
the Company's proxy statement for the shareholders' meeting August 1997.

                                       7

<PAGE>



                              WORLD SERVICES, INC.

                           PART II. OTHER INFORMATION

ITEM 1. - LEGAL PROCEEDINGS
--------------------------------------------------------------------------------

The Company is not a party to any legal  proceedings  except as follows,  and no
such proceedings are known to be contemplated.

The Company was a plaintiff in a civil action in the Circuit  Court of the Fifth
Judicial  Circuit  of the  State of South  Dakota  (Civ97-187,  entitled  "World
Services,  Inc. vs. Murray Woulfe") against Murray Woulfe, a former president of
World  Services,  on a promissory  note. The actions sought  recovery of $19,000
plus interest and costs.  Mr.  Woulfe denied  liability and claimed that he owed
World Services no obligation under the promissory note. The matter was scheduled
for trial in May of 1998 and was held  before one of the  Circuit  Judges of the
Fifth Judicial Circuit in and for the County of Brown, State of South Dakota. As
to the ultimate result,  Plaintiff expected to prevail;  however,  the defendant
had the right of appeal to the appellate court of the State of South Dakota. Mr.
Woulfe  made  material  counterclaims  against  Would  Services.  The  defendant
prevailed and therefore World Services did not recover the $19,000 plus interest
and costs.  The  counterclaim  resulted  in the  plaintiff  owing the  defendant
$8,009.10  and  writing  off $4,000 in  receivables.  The  financial  statements
reflect these results.

ITEM 2. - CHANGES IN SECURITIES
--------------------------------------------------------------------------------

None.

ITEM 3. - DEFAULT UPON SENIOR SECURITIES
--------------------------------------------------------------------------------

None.

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

There were no  shareholder  meetings and no matters were  submitted to a vote of
shareholders during the second quarter of the fiscal year.

                                       8
<PAGE>


                              WORLD SERVICES, INC.

                           PART II. OTHER INFORMATION
                                   (Continued)



ITEM 5. - OTHER INFORMATION
--------------------------------------------------------------------------------

None.

ITEM 6. - EXHIBITS
--------------------------------------------------------------------------------

Exhibit 27 - Financial Data Schedule.



                                       9

<PAGE>



                                   SIGNATURES


Pursuant to the  requirements of Section 13 or 15(d) 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.

August 10, 1998

                                                   WORLD SERVICES, INC.


                                            By: /s/ Ronne Tarrell
                                               ---------------------------------
                                               Ronne Tarrell, President, Chief
                                               Executive Officer and Principal
                                               Financial Officer




                                       10