UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB
(Mark One)

            [ X ] QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE
                  SECURITIES EXCHANGE ACT OF 1934

                      For the Quarter Ended March 31, 2004

            [   ] TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE
                  EXCHANGE ACT

         For the transition period from ____________ to ____________

                         COMMISSION FILE NUMBER: 0-15224

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

                   COLORADO                        84-0969445
          ---------------------------        ------------------------
           (State of incorporation)          (IRS Employer ID number)

        7334 SOUTH ALTON WAY, BUILDING 14, SUITE F, CENTENNIAL, CO 80112
         -------------------------------------------------------------
               (Address of principle executive offices) (Zip Code)

                                 (303) 267-0111
                   -------------------------------------------
                (Issuer'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 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 requirements for the past 90
days.

              YES              NO    X
                  -------         --------

As of May 11, 2004, the Company had 25,618,177 shares of Common Stock, $.001 par
value per share outstanding.


<PAGE>

                       ADVANCE DISPLAY TECHNOLOGIES, INC.

                                      INDEX

                                                                            PAGE

                        PART I. FINANCIAL INFORMATION

Item 1.  Consolidated Balance Sheets (unaudited)
            March 31, 2004 and June 30, 2003.................................1

         Consolidated Statements of Operations (unaudited)
            Three and nine months ended March 31, 2004 and 2003..............2

         Consolidated Statements of Cash Flows (unaudited)
            Three and nine months ended March 31, 2004 and 2003............3-4

         Notes to Consolidated Financial Statements (unaudited)............5-8

Item 2.  Management's Discussion and Analysis or Plan of Operations.......8-13

            Overview.........................................................8
            New Theater Operations.........................................8-9
            Management.......................................................9
            Reorganization of Capital Structure...........................9-11
            Results of Operations........................................11-12
            Liquidity and Capital Resources..............................12-13
            Forward Looking Statements......................................13

Item 3.  Controls and Procedures............................................14



                          PART II. OTHER INFORMATION

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

            Signatures......................................................16

                                       i

<PAGE>

                          PART 1. FINANCIAL INFORMATION
ITEM 1.
                       ADVANCE DISPLAY TECHNOLOGIES, INC.

                                 BALANCE SHEETS
                                   (UNAUDITED)
<TABLE>
<CAPTION>
                                                         March 31,       June 30,
                                                           2004            2003
                                                       ------------    ------------
                                       ASSETS
CURRENT ASSETS:
<S>                                                    <C>             <C>
   Cash                                                $    278,650    $     10,878
   Other current assets                                      55,398          14,281
                                                       ------------    ------------
      Total current assets                                  334,048          25,159

PROPERTY AND EQUIPMENT                                      141,090         125,932
   Less:  Accumulated depreciation                         (119,820)       (114,774)
                                                       ------------    ------------
      Net Property and Equipment                             21,270          11,158

INTANGIBLE ASSETS                                           203,840             ---
   Less:  Accumulated amortization                          (18,612)            ---
                                                       ------------    ------------
      Total Intangible Assets                               185,228             ---

OTHER ASSETS                                                 13,550             ---
                                                       ------------    ------------

      TOTAL ASSETS                                     $    554,096    $     36,317
                                                       ============    ============

                        LIABILITIES AND SHAREHOLDERS' DEFICIT
CURRENT LIABILITIES:
   Accounts payable
      Trade                                            $    400,539    $    261,800
      Related party                                         123,748         123,789
   Current portion of notes payable-related party               ---       1,030,000
   Convertible, redeemable promissory notes
      payable-related party                                     ---       2,911,079
   Accrued interest-related parties                             ---       1,340,268
   Other accrued liabilities                                167,611          41,603
                                                       ------------    ------------
      Total current liabilities                             691,898       5,708,539

STOCKHOLDERS' DEFICIT:
   Preferred Series C stock, $.001 par value,
      100,000,000 shares authorized, 0 and 1,843,902
      shares issued and outstanding at March 31, 2004
      and June 30, 2003, respectively (liquidation
      preference of $2,765,850)                                 ---           1,844
   Preferred Series D stock, $.001 par value,
      60,000,000 shares authorized, 60,000,000 and 0
      shares issued and outstanding at March 31, 2004
      and June 30, 2003, respectively (liquidation
      preference of $1,000,000)                              60,000             ---
   Preferred Series E stock, $.001 par value,
      1,008,985 shares authorized,
      1,008,985 and 0 shares issued
      and outstanding at March 31, 2004 and June 30,
      2003, respectively (liquidation preference of
      $1,008,895)                                             1,009             ---
   Preferred Series F stock, $.001 par value,
      4,549,015 shares authorized,
      4,549,015 and 0 shares issued
      and outstanding at March 31, 2004 and June 30,
      2003, respectively (liquidation preference of
      $4,549,015)                                             4,549             ---
   Preferred subscriptions receivable                      (400,000)            ---

   Common stock, $.001 par value, 100,000,000 shares
      authorized, 25,618,177 and 23,774,275 issued and
      outstanding at March 31, 2004 and June 30, 2003,
      respectively                                           25,618          23,775

   Additional paid-in capital                            10,936,212       4,443,770
   Accumulated Deficit                                  (10,765,190)    (10,141,611)
                                                       ------------    ------------
      Total Shareholders' Deficit                          (137,802)     (5,672,222)
                                                       ------------     -----------

TOTAL LIABILITIES AND SHAREHOLDERS' DEFICIT            $    554,096    $     36,317
                                                       ============    ============
</TABLE>
          (See accompanying notes to unaudited financial statements)

                                       1
<PAGE>

                       ADVANCE DISPLAY TECHNOLOGIES, INC.

                            STATEMENTS OF OPERATIONS
                                   (UNAUDITED)



<TABLE>
<CAPTION>
                                          Three Months Ended        Nine Months Ended
                                              March 31,                 March 31,
                                      -------------------------   -------------------------
                                          2004          2003          2004          2003
                                      -----------   -----------   -----------   -----------
 REVENUE
<S>                                   <C>           <C>           <C>           <C>
     Box office receipts              $   316,199   $       ---   $   439,176   $       ---
     Concession revenue                    95,817           ---       136,499           ---
     Screen and facility rentals           38,148           ---        67,133           ---
                                      -----------   -----------   -----------   -----------
        Total revenue                     450,164           ---       642,808           ---

 COST OF SALES AND SERVICES
     Film rentals                         140,403           ---       223,064           ---
     Concession purchases                  22,907           ---        28,075           ---
     Booking fees                           6,585           ---         8,705           ---
                                      -----------   -----------   -----------   -----------
        Total cost of sales and
         services                         169,895           ---       259,844           ---
                                      -----------   -----------   -----------   -----------

 GROSS PROFIT                             280,269           ---       382,964           ---

 COSTS AND EXPENSES:
     General and administrative           518,941       113,520       890,315       420,120
                                      -----------   -----------   -----------   -----------
        Total costs and expenses          518,941       113,520       890,315       420,120
                                      -----------   -----------   -----------   -----------

 LOSS FROM OPERATIONS                    (238,672)     (113,520)     (507,351)     (420,120)

 OTHER INCOME (EXPENSE):
     Other interest income                    374             2           456            34
     Interest expense - related
      parties                                 ---       (94,226)     (116,685)     (277,205)
                                      -----------   -----------   -----------   -----------
        Total other income
         (expense)                            374       (94,224)     (116,229)     (277,171)
                                      -----------   -----------   -----------   -----------

 LOSS BEFORE EXTRAORDINARY GAIN       $  (238,298)  $  (207,744)  $  (623,580)  $  (697,291)
                                      -----------   -----------   -----------   -----------

 EXTRAORDINARY GAIN DUE TO
    EXTINGUISHMENT OF DEBT                    ---           ---           ---         2,590
                                      -----------   -----------   -----------   -----------

 NET LOSS                             $  (238,298)  $  (207,744)  $  (623,580)  $  (694,701)
                                      ===========   ===========   ===========   ===========

    ACCRUED PREFERRED SERIES E
     DIVIDEND                             (12,612)          ---       (16,816)          ---
                                      -----------   -----------   -----------   -----------

 NET LOSS APPLICABLE TO COMMON
 SHAREHOLDERS                         $  (250,910)   $(207,744)   $  (640,396)  $  (694,701)
                                      ===========   ===========   ===========   ===========

 NET LOSS PER COMMON SHARE
     (BASIC AND DILUTIVE):
      Loss before extraordinary
       gain                           $      (.01)  $      (.01)  $      (.03)  $      (.03)
      Extraordinary Gain                      ---           ---           ---           ---
                                      -----------   -----------   -----------   -----------
      Net loss                        $      (.01)  $      (.01)  $      (.03)  $      (.03)
                                      ===========   ===========   ===========   ===========

 WEIGHTED AVERAGE NUMBER OF
 COMMON SHARES OUTSTANDING             25,618,175    23,774,275    24,593,786    23,774,275
                                      ===========   ===========   ===========   ===========
</TABLE>

         (See accompanying notes to unaudited financial statements)
                                       2


<PAGE>


                       ADVANCE DISPLAY TECHNOLOGIES, INC.

                            STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)


<TABLE>
<CAPTION>
                                          Three Months Ended          Nine Months Ended
                                            March 31, 2004              March 31, 2004
                                          2004          2003          2004         2003
                                      -----------   -----------   -----------   -----------
CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                   <C>           <C>           <C>           <C>
  Net Loss                            $  (238,298)  $  (207,744)  $  (623,580)  $  (694,701)
Adjustments to reconcile net loss
to net
 Cash used in operating activities:
  Depreciation and amortization            16,077         1,575        23,660         4,767
  Extraordinary gain due to
    extinguishment of debt                    ---           ---          ---          2,590
(Increase) decrease in:
  Other current assets                    (43,849)       23,593       (43,993)        4,150
(Decrease)  increase in:
  Accounts payable                        (83,792)       29,122       (42,367)       49,376
  Interest payable to shareholders            ---        94,226       116,685       277,205
  Other accrued liabilities                 2,006        13,689        28,659        14,816
                                      -----------   -----------   -----------   -----------
    Net cash used in operating
      activities                         (347,856)      (45,539)     (540,936)     (341,797)
                                      -----------   -----------   -----------   -----------

CASH FLOWS FROM INVESTING ACTIVITIES:
  Cash received in acquisition                ---           ---        52,825           ---
  Purchase of equipment                    (4,117)          ---        (4,117)          ---
                                      -----------   -----------   -----------   -----------
    Net cash provided by (used in)
      investing activities                 (4,117)          ---        48,708           ---
                                      -----------   -----------   -----------   -----------

CASH FLOWS FROM FINANCING ACTIVITIES:
  Capital contributions                   400,000           ---       600,000           ---
  Proceeds from notes payable to
   shareholders                               ---        40,000       160,000       320,000
                                      -----------   -----------   -----------   -----------
    Net cash provided by financing
     activities                           400,000        40,000       760,000       320,000
                                      -----------   -----------   -----------   -----------

Increase (decrease) in cash                48,027        (5,539)      267,772       (21,797)
Cash & cash equivalent at beginning
  of period                               230,623         6,462        10,878        22,720
                                      -----------   -----------   -----------   -----------
Cash & cash equivalent at end of
  period                              $   278,650   $       923   $   278,650   $       923
                                      ===========   ===========   ===========   ===========
</TABLE>

          (See accompanying notes to unaudited financial statements)

                                       3

<PAGE>

                       ADVANCE DISPLAY TECHNOLOGIES, INC.

                            STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)


<TABLE>
<CAPTION>
                                         Three Months Ended          Nine Months Ended
                                              March 31,                  March 31,
                                          2004        2003           2004          2003
                                      -----------   -----------   -----------   -----------

 SUPPLEMENTAL DISCLOSURE OF CASH
  FLOW INFORMATION
 Cash paid for:
<S>                                   <C>           <C>           <C>           <C>
   Interest                           $       ---   $       ---   $       ---   $       ---
                                      ===========   ===========   ===========   ===========
   Taxes                              $       ---   $       ---   $       ---   $       ---
                                      ===========   ===========   ===========   ===========
 Acquired membership interest in
  Regent Theaters, L.L.C. and
  Regent Releasing L.L.C.             $       ---   $       ---   $    50,000   $       ---
                                      ===========   ===========   ===========   ===========
 Conversion of Preferred Series C
  stock to common stock               $       ---   $       ---   $     1,844   $       ---
                                      ===========   ===========   ===========   ===========
 Subscriptions for Preferred
  Series D stock                      $   400,000   $       ---   $   800,000   $       ---
                                      ===========   ===========   ===========   ===========
 Conversion of demand notes and
  accrued interest to Preferred
  Series E stock                      $       ---   $       ---   $ 1,008,985   $       ---
                                      ===========   ===========   ===========   ===========

 Conversion of convertible,
  redeemable Promissory notes,
  demand notes and accrued
  interest to Preferred Series
  F stock                             $       ---   $       ---   $ 4,549,015   $       ---
                                      ===========   ===========   ===========   ===========
</TABLE>

          (See accompanying notes to unaudited financial statements)

                                       4

<PAGE>

                       ADVANCE DISPLAY TECHNOLOGIES, INC.
             NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1.     INTERIM FINANCIAL STATEMENTS

      The accompanying unaudited interim financial statements have been prepared
in accordance with the instructions to Form 10-QSB and do not include all the
information and footnotes required by generally accepted accounting principles
for complete financial statements. In the opinion of management, all adjustments
(consisting of normal recurring accruals) considered necessary for a fair
presentation have been included. The results of operations for any interim
period are not necessarily indicative of results for the entire fiscal year.

      These statements should be read in conjunction with the financial
statements and related notes included in Form 10-KSB for Advance Display
Technologies, Inc. (ADTI or the Company) for the year ended June 30, 2003 as the
notes to these interim financial statements omit certain information required
for complete financial statements.


NOTE 2.     ACQUISITION AND PLANNED DISPOSITION

      On November 30, 2003, the Company acquired all of the membership interests
in Regent Theaters, L.L.C. ("Theaters") and Regent Releasing, L.L.C.
("Releasing") from Regent Entertainment Partnership, L.P. of Dallas, Texas. The
Company then shifted its primary focus to these newly acquired Theaters and
Releasing operations. However, the Company continued its historical business of
developing and producing fiber optic display screen systems. Two theaters leased
and operated by Theaters formed the base of the Company's planned national chain
of specialty motion picture theaters.  Subsequent to March 31, 2004, the
Company reassigned its ownership interests in Theaters and Releasing back to
the original owners.  See Note 5.

      Financial results of the newly acquired businesses from December, 2003
have been included in the consolidated financial statements.

      The purchase price of $50,000 for the membership interests has not been
paid. The purchase price was allocated to intangible assets totaling $203,840
and net tangible assets totaling $74,541; net of assumed liabilities totaling
$228,381. The identifiable intangible assets and the estimated useful lives are
as follows:


      ----------------------------------------------------------------
      Favorable Leases                           2 - 8 years
      ----------------------------------------------------------------
      Customer Lists                             3 years
      ----------------------------------------------------------------
      Business Relationships                     5 - 10 years
      ----------------------------------------------------------------
      Film Service Agreements                    1 year
      ----------------------------------------------------------------


      The following unaudited pro forma financial information reflects the
consolidated results of operations of the Company as if the acquisitions of
Theaters and Releasing had taken place on July 1, 2003 or July 1,

                                       5

<PAGE>

2002. The pro forma financial information is not necessarily indicative of the
results of operations as it would have been had the transaction been effected on
either of the assumed dates.

                                                    Pro Forma
                                          Nine Months Ended March 31,
      ----------------------------------------------------------------
                                              2004          2003
                                              ----          ----
      ----------------------------------------------------------------
      Revenue                             $ 1,249,000   $ 1,300,000
      ----------------------------------------------------------------
      Net Loss                            $  (771,136)  $(1,010,000)
      ----------------------------------------------------------------
      Net Loss per Share                  $      (.03)  $      (.05)
      ----------------------------------------------------------------


NOTE 3.     FORMERLY DEVELOPMENT STAGE COMPANY

      Prior to December 1, 2003, the Company was in the development stage, as it
had not yet commenced its principal operations or realized significant revenues
from its planned operations. Due to the newly acquired entities and immediate
revenues realized from the operation of the Theaters, the Company was no longer
considered in the development stage as of March 31, 2004.  However, after the
disposal of the theater assets (see Note 5) the Company will likely reenter
the development stage.


NOTE 4.     NEW EQUITY CAPITAL AND DEBT RESTRUCTURING

            The Company funded the acquisition by issuing a new voting,
convertible, participating series of the Company's Series D Preferred Stock to
certain new and existing shareholders in a private financing. The total proceeds
from the financing were expected to total $1,000,000, of which $600,000 was
received prior to March 31, 2004. (See Note 5.)

      The Company also converted all of the 1,843,902 outstanding shares of the
Company's Series C Preferred Stock into 1,843,902 shares of the Company's Common
Stock. In addition, the Company converted $1,008,985 of its debt into 1,008,985
shares of the Company's new non-voting, non-convertible, junior priority, Series
E Preferred Stock, and $4,549,015 of its debt into 4,549,015 shares of the
Company's new non-voting, non-convertible, junior priority, Series F Preferred
Stock.


NOTE 5.     SUBSEQUENT EVENTS

      On April 7, 2004, Stephen P. Jarchow, one of the Company's directors,
advised the Company that he was resigning from the Board of Directors effective
immediately. Mr. Jarchow's resignation from the Board was accompanied by a
demand letter from Mr. Jarchow on behalf of Regent Entertainment Partnership,
L.P. ("Regent Entertainment") that, because the Company had breached its
obligations under the November 30, 2003 Unit Purchase Agreement (the "UPA")
between the Company and Regent Entertainment effecting the Company's purchase of
all of the membership interests in Theaters and Releasing, those transactions
should be considered null and void. Theaters is the lessee and operator of two
movie theaters, one in Dallas and one in Los Angeles. In the UPA, the Company
agreed to pay Regent Entertainment Partnership $50,000 in cash

                                       6

<PAGE>

for the membership interests, which was based on the parties' estimate of the
value of the tangible assets conveyed in the transaction. The Company had
previously informed Regent Entertainment that it was withholding the $50,000
cash payment on the grounds that there were significant undisclosed accounts
payable of Theaters and that the operating losses of Theaters and Releasing were
greater than had been described to the Company by Mr. Jarchow and Regent
Entertainment. Mr. Jarchow also asked the Company to immediately cease its
operations in connection with Theaters and Releasing.

      Mr. Jarchow also claimed, on behalf of himself and Paul Colichman, the
other principal of Regent Entertainment, that the November 30, 2003 Stock
Purchase Agreement (the "SPA") between the Company, Messrs. Jarchow and
Colichman, Gene W. Schneider, and Lawrence F. DeGeorge, one of the Company's
directors, had been breached and should also be considered null and void. Under
the SPA, the Company sold shares of a new voting, convertible, participating
series of the Company's preferred stock ("Series D") in a private transaction.
The total proceeds from the financing were expected to total $1,000,000.

      Mr. Jarchow claims that the SPA has been breached because only $600,000 of
the $1,000,000 in gross sales proceeds has been received by the Company to date,
and the Company has not paid the $50,000 due to Regent Entertainment under the
UPA. The Company believes that one of the four investors, Mr. DeGeorge, withheld
$400,000 of the $500,000 which was to be funded by Mr. DeGeorge under the SPA
because, based on the preliminary financial results and condition of Theaters
and Releasing (including those reported in the Company's Form 10-QSB for the
period ended December 31, 2003), he believed that there were significant
undisclosed accounts payable of Theaters and that the operating losses of
Theaters and Releasing were greater than had been described to the Company by
Mr. Jarchow and Regent Entertainment. In response, Messrs. Jarchow and Colichman
have demanded the return of their aggregate $250,000 investment under the SPA,
less any expenses incurred by the Company directly related to the operations of
the theaters.

      On May 18, 2004 the Company responded to Mr. Jarchow's demands for
rescission of the UPA by assigning the Theater and Releasing entities back to
Regent Entertainment. The Company believes that these entities were highly
dependent on the advice and assistance of Messrs. Jarchow and Colichman in the
Company's business strategy of developing a national chain of gay and lesbian
themed movie theaters. In addition, the Company does not believe that, in light
of the loss of Mr. Jarchow from the Company's Board of Directors and the ongoing
losses of Theaters, most or all of which are derived from the negative results
of the Los Angeles theater, that the Theater business strategy is economically
or operationally viable. Accordingly, the Company has tendered its ownership
interests in Theaters and Releasing to Regent Entertainment as demanded in Mr.
Jarchow's rescission request of the UPA. With respect to his demand for
rescission of the SPA, however, the Company cannot yet determine what amounts,
if any, should be returned to Messrs. Jarchow and Colichman since the allocation
of financial responsibility for the transactional and administrative costs of
the Company since the November 30, 2003 closing of the SPA and UPA is presently
unresolved.

      The Company is hopeful that all disputes with Regent Entertainment and
Messrs. Jarchow and Colichman can be resolved without litigation but there can
be no assurance that the Company will avoid litigation with them and the
potential diminishment of the Company's limited resources which such litigation
would entail.

                                       7

<PAGE>

      As the Company has re-assigned its ownership interests in Theaters and
Releasing to Regent Entertainment and effectively rescinded the UPA, the
Company's only business is again the technological development and manufacture
of large screen fiber optic displays for various industries and applications
(the "Screen Business"). Because the Screen Business has never generated
material revenues, the Company may be unable to obtain sufficient capital to
continue development of that business. In such an event, the Company may be
required to cease operations, liquidate its assets and terminate some or all of
its employees.

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS

OVERVIEW

      In the second fiscal quarter ended December 31, 2003, the Company acquired
all of the membership interests in Regent Theaters, L.L.C. and Regent Releasing,
L.L.C., from Regent Entertainment Partnership, L.P., of Dallas, Texas. As a
result, ADTI had shifted its primary focus to its newly acquired theater and
theatrical releasing operations. ADTI also continued its historical business of
developing and producing fiber optic display screen systems for video billboard
and other display applications. Now, however, since the Company re-assigned the
ownership interests back to Regent Entertainment, its focus will again be on the
Screen Business.

NEW THEATER OPERATIONS

      Two theaters operated by Regent Theaters, L.L.C. formed the base of the
Company's planned national chain of specialty motion picture theaters. The
Company had hoped to acquire the rights to additional theaters across the
country which were to be re-formatted, to varying degrees, as high quality,
jewel box theaters presenting high quality, gay and lesbian themed, motion
pictures, as well as other specialty motion pictures. Stephen P. Jarchow, a
member of the Company's Board of Directors at the time of the acquisition, is a
principal of Regent Entertainment, which produces motion pictures in a variety
of genres, including those appealing to the gay and lesbian audience. Mr.
Jarchow and the other principal of Regent Entertainment, Paul Colichman, were
expected to actively assist management's efforts to locate and develop
additional movie theaters across the country. On April 7, 2004, however, Mr.
Jarchow resigned from the Company's Board of Directors and demanded a rescission
of the UPA. Subsequently, the Company considered the negative financial
performance of these assets and determined that their re-assignment to Regent
Entertainment was in the best interest of the Company, which assignment was made
on May 18, 2004.

      Neither Regent Theaters, L.L.C. nor Regent Releasing, L.L.C., owns any
movie theaters or other real property. Regent Theaters, L.L.C. leases both of
its two movie theaters which are located in Dallas and in Los Angeles. The
Dallas theater is leased from Highland Park Shopping Village through January 12,
2011 at a monthly rental rate equal to the greater of (a) 10% of theater
revenues or (b) an escalating share of operating expenses that peaks at $10,308
per month in 2010. The Los Angeles theater is leased from Regent Showcase
L.L.C., a limited liability company, owned and controlled by Messrs. Jarchow and
Colichman, at a monthly rental equal to the greater of $10,000 (escalating 3%
per annum) or 10% of theater revenues, plus its share of common area operating
expenses, through November 30, 2013.

                                       8

<PAGE>

      The Regent Highland Park Village Theater in Dallas is a four screen
500-seat complex in the prestigious Highland Park Village shopping center, at
the corner of Preston Road and Mockingbird Lane. It typically plays major studio
and independent films on three screens and quality crossover gay motion pictures
on one screen.

      The Regent Showcase Theater in Los Angeles is a single screen 800-seat
theater located near La Brea and Melrose in West Hollywood. It currently follows
a programming strategy similar to the Dallas theater.

MANAGEMENT

      Matthew W.  Shankle  will  continue as president of the Company and will
manage  its  day-to-day  operations.  Messrs.  DeGeorge,  Shankle  and a newly
appointed director, John W. Temple, will continue as directors of the Company.

REORGANIZATION OF CAPITAL STRUCTURE

      As a precondition to the acquisition of Regent Theaters, L.L.C. and Regent
Releasing, L.L.C., the Company reorganized itself (the "Reorganization) by: (i)
converting all outstanding shares of the Company's Series C Preferred Stock into
Common Stock; (ii) converting all of the Company's debt into two new non-voting,
non-convertible, junior priority, series of the Company's preferred stock; and
(iii) obtaining subscriptions from existing and new shareholders to invest
$1,000,000 in shares of a new, convertible, senior series of its preferred
stock. The first $600,000 payable from the subscriptions was received by March
31, 2004.

      CONVERSION OF SERIES C PREFERRED STOCK. All of the Company's Series C
Preferred Stock ("Series C Preferred") has been converted to shares of the
Company's Common Stock, on a one-for-one basis.

      Formerly, holders of the Company's Series C Preferred had no voting
rights, except as required by law, but had dividend, liquidation, and redemption
preferences, including the right of redemption at either the Company's option or
the holder's option. Shares of the Company's Common Stock received in the
conversion have one vote per share and receive proceeds on the liquidation of
the Company only after all debt and other obligations of the Company have been
satisfied, and the liquidation preferences of the Company's preferred stock have
been paid. The Common Stock received was not registered for resale with the
Securities and Exchange Commission but recipients were granted the right to
"piggy back" the registration of their shares of Common Stock on other
registration statements filed by the Company, subject to customary limitations.

      DEBT CONVERSION - SERIES E PREFERRED. The holders of the Company's
previously outstanding debt have exchanged their debt for shares of the
Company's preferred stock. Debt incurred since January 25, 2002 totaling
$1,008,985, which was used to finance the Company's pursuit of various business
opportunities, has been exchanged for 1,008,985 shares of a new, non-voting,
non-convertible series of the Company's preferred stock ("Series E Preferred").
The Series E Preferred will have no voting rights except for those required by
law.

      The Series E Preferred will receive a 5% dividend based on the $1,008,895
purchase price of the Series E Preferred. This is a mandatory dividend, which
may not be increased or decreased, and will be

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automatically cumulated on December 31st of each year even if not declared by
the Company's Board of Directors. The Series E Preferred is not convertible into
any other series or class of the Company's capital stock. Upon liquidation of
the Company, the Series E Preferred is junior to the Series D Preferred
(described below), but senior to all of the Company's other capital stock.

      The Company will have the option, but not the obligation, to redeem any or
all of the shares of Series E Preferred at any time beginning three years from
the date of issuance. The redemption price will be the stated value per share
plus accrued but unpaid dividends.

      DEBT CONVERSION - SERIES F PREFERRED. The debt incurred by the Company
prior to January 25, 2002, totaling $4,549,015, was exchanged for 4,549,015
shares of another new, nonvoting, nonconvertible series of the Company's
preferred stock ("Series F Preferred"). Like the Series E Preferred, the Series
F Preferred has no voting rights except as required by law, has no conversion
rights, and is redeemable by the Company at a stated value at any time beginning
three years from the date of issuance. Unlike the Series E Preferred, however,
the Series F Preferred has no rights to dividends. Furthermore, the Series F
Preferred is junior to the Series D Preferred and Series E Preferred, but senior
to the Company's Common Stock, on liquidation.

      NEW CAPITAL INVESTMENT - SERIES D PREFERRED. The Company expected to raise
$1,000,000 in new capital by issuing a new voting, convertible, participating
series of the Company's preferred stock (the "Series D Preferred") to affiliates
of the Company. The proceeds were being used to develop and expand the Company's
theater operations. The Company issued 36,000,000 shares of Series D Preferred
at a price of approximately $0.0167 per share, for aggregate consideration of
$600,000, through March 31, 2004, coincident with the acquisition of Regent
Theaters, L.L.C. and Regent Releasing, L.L.C.

      Holders of Series D Preferred have one vote per share and vote with the
holders of Common Stock on all matters and have class voting rights where
required by law. The Series D Preferred is convertible into shares of Common
Stock at the election of the holder thereof at an initial conversion rate of
$0.0167 per share. The conversion rate will be adjusted in the event of a
merger, stock split, stock combination, or stock dividend.

      The Series D Preferred has the most senior liquidation preference of all
of the Company's capital stock. In the event of any liquidation, dissolution or
winding up of the Company, either voluntarily or involuntarily, or a sale of the
Company, the holders of the Series D Preferred would be entitled to receive,
after due payment or provision for payment for the debts and other liabilities
of the Company, a liquidating distribution before any distribution may be made
to holders of any other capital stock, in an amount equal to the greater of (a)
the stated value of the shares of Series D Preferred plus any accrued and unpaid
dividends or (b) the amount that would be paid to the holders of Series D
Preferred on an "as converted" basis.

      The Series D Preferred does not earn any dividend; rather, like the Common
Stock, the holders of Series D Preferred are entitled to dividends only if and
when declared by the Board of Directors.

      Finally, the holders of Series D Preferred have been granted demand
registration rights for the underlying shares of Common Stock and the right to
"piggy back" on registrations that the Company initiates, subject to customary
limitations. In addition, in order to protect potential tax benefits of the
Company, the

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<PAGE>

holders of Series D Preferred have agreed not to transfer their Series D
Preferred (or Common Stock received upon conversion) without the Company's
permission.

      There can be no assurance that the Company will be successful in achieving
profitably in operations. If the Company fails to do so, it will be forced to
immediately discontinue its operations, liquidate its assets and terminate some
or all of its employees. In such an event, it is extremely unlikely that there
would be any funds or property available for distribution to shareholders in
such liquidation, especially the holders of Common Stock, who would have the
lowest priority in any such liquidation.

RESULTS OF OPERATIONS

      For the fiscal quarter and nine months ended March 31, 2004 the Company
reported net losses of ($238,298) and ($623,580), respectively, as compared to
net losses of ($207,744) and ($694,701) for the same periods in 2003. The
decrease in net loss for the nine months ended March 31, 2004 from 2003 is
primarily due to the Company's efforts to complete the Reorganization as
described above, partially offset by an increase in net loss for the quarter
ended March 31, 2004 over 2003 due to inclusion of the Theater and Releasing
operations for the entire quarter.

      Prior to December 1, 2003, the Company was in the development stage, as it
had not yet commenced its principal operations or realized significant revenues
from its planned operations. Due to the newly acquired entities and immediate
revenues realized from the operation of the theaters, the Company may no longer
be in the development stage. The Company acquired its theater and releasing
companies effective November 30, 2003 and therefore has included only four
months of operating results from these subsidiaries in these financial
statements for the nine months ended March 31, 2004.

      Because the Company suspended the manufacturing process development and
product commercialization efforts for its fiber optic display screen systems for
the past 28 months to focus on effecting the Reorganization, the balance of the
Company's financial results merely reflect the expenses incurred in that effort,
and operating Theater and Releasing since December 1, 2003.

      As a result, the Company is reporting revenues from theater operations of
$450,164, for the quarter ended March 31, 2004 and only $642,808 for the nine
months ended March 31, 2004 as only four months of combined operations are
reflected in the nine month period. Cost of sales and services totaled $169,895
and $259,845 for the quarter and nine months ended March 31, 2004 resulting in
gross profit for the 2004 periods of $280,269 and $382,964, respectively. There
were no revenues from theater operations to report for the quarter or nine
months ended March 31, 2003.

      The Company reported general and administrative expenses of $518,941 and
$890,315 for the quarter and nine months ended March 31, 2003, compared to
$113,520 and $420,120 for the same periods in 2003, respectively. For the
quarter and nine months ended March 31, 2004, general and administrative expense
of approximately $364,000 and $507,000 is due to the operations of the acquired
entities. Although professional fees increased by approximately $42,000 for the
quarter ended March 31, 2004, from the same period in 2003 primarily due to the
audit of the acquired entities, professional fees decreased by approximately
$13,000 for the nine month period primarily in connection with a shift in focus
with respect to the means of accomplishing the Reorganization, partially offset
by the audit expense. The Company experienced a decrease of

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<PAGE>

approximately $24,000 and $44,000 in insurance expense for the quarter and nine
months ended March 31, 2004, respectively, over the same periods ended March 31,
2003 due to negotiated reductions in premiums. Salaries increased by
approximately $22,000 and $24,000 for the quarter and nine months ended March
31, 2004 over 2003 primarily due to the addition of an employee. Other general
and administrative expenses fluctuated slightly resulting in a net change to the
combined remaining general and administrative expenses of approximately $1,000
and ($4,000) for the quarter and nine month period ended March 31, 2004 over
2003, respectively.

      Interest expense decreased from $277,205 for the nine month period ended
March 31, 2003 to $116,685 for the same period in 2004 primarily due to the
conversion of all the Company's outstanding debt to shares of preferred stock
during the six months ended March 31, 2004.

LIQUIDITY AND CAPITAL RESOURCES

      Since inception, the Company has been totally dependent on financing from
outside sources to fund operations. Effective December 1, 2003, the principal
and accrued interest of all outstanding debt was converted to shares of the
Company's newly created Series E and Series F Preferred Stock. In addition, as
part of the reorganization, the Company received subscriptions for $1,000,000 of
its newly created Series D Preferred Stock. As of the date of this report,
$600,000 of the $1,000,000 in cash due has been received from these investors.
As a result of the Reorganization and the new subscriptions, the Company
reported negative net worth of $137,802 at March 31, 2004 compared to negative
net worth of $5,672,222 at June 30, 2003.

      The Company's working capital position improved from negative $5,683,380
at June 30, 2003 to negative $357,850 at March 31, 2004. The additional
subscriptions to be received of $400,000 would have created positive working
capital of $42,150. However, due to the subsequent assignment of Theaters and
Releasing back to Regent Entertainment, there can be no assurance that the
Company will receive the additional subscriptions receivable, be able to achieve
profitable operations in the foreseeable future or that the Company's capital
resource will be adequate to support its business.

      If the Company's financial resources do prove to be inadequate, it may be
required to reduce the scope of its operations, which could have a materially
adverse effect on the Company. If the Company does not retain the funds provided
through the Reorganization, the Company will be forced to seek other means of
funding or to discontinue operations, liquidate its assets and terminate some or
all of its employees. In such an event, it is extremely unlikely that there
would be any funds or property available for distribution to shareholders in
such liquidation.

      Cash flows from financing activities for the nine month period ended March
31, 2004 and 2003 consisted of the issuance of 10% demand notes to shareholders
totaling $160,000 and $320,000, respectively; and $600,000 in 2004 in proceeds
from the sale of equity in connection with the Company's Reorganization
described above. Cash flows for the nine month period ended March 31, 2004 were
used for four months of theater operating expenses, professional fees, and for
general corporate administrative expense. Cash flows for the quarter ended March
31, 2003 were primarily used for administrative and operational expenses as
management efforts were focused completely on the Reorganization.

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<PAGE>

      At March 31, 2004, the Company reported current assets of $334,048 and a
working capital deficit. Current liabilities exceeded current assets by
$357,850. At March 31, 2004, current liabilities of $691,898 consisted of trade
payables and accrued expenses which were incurred primarily through: 1) the
acquisition of Regent Theaters, L.L.C.; 2) accumulation of professional fees in
connection with the Reorganization; and 3) operating costs. Management intends
to negotiate settlement on approximately $67,400 of aged payables and accrued
expenses by payment of a reduced amount in cash or by issuance of shares of the
Company's Common Stock. Also, due to inadequacies in certain product design and
development by a contracted engineering firm, the Company is currently disputing
approximately $81,000 in engineering fees.

                           FORWARD LOOKING STATEMENTS

      Certain statements contained herein constitute "forward looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. Such forward looking statements include, without limitation, statements
regarding the Company's future revenues and results of operations. These
statements can be identified by the use of forward-looking terminology such as
"believes," "expects," "may," "will," "could," "should" or "anticipates" or the
negative thereof or other variations thereon or comparable terminology, or by
discussions of strategy that involve risks and uncertainties. These
forward-looking statements involve risks and uncertainties, including but not
limited to the following: the Company's limited financial resources and small
management team may prove to be insufficient to continue the screen business and
various other risks typical of businesses with a limited operating history and
historically unsuccessful financial results.

      Although management believes the expectations reflected in the
forward-looking statements made herein are based on reasonable assumptions, the
Company cannot assure investors that these expectations will prove correct, and
the actual results that the Company achieves may differ materially from any
forward-looking statements, due to such risks and uncertainties. Factors that
could cause actual results to differ materially include, among others, the
following: future economic conditions, the ability of the Company to generate
sufficient capital to develop a profitable business, its success in attracting
and retaining qualified management and other personnel, and generally its
development and successful execution of a business plan that will take the
Company to a profitable operating company. Some of these factors are outside the
control of the Company. Investors are cautioned not to put undue reliance on
forward looking statements. Except as otherwise required by rules of the
Securities and Exchange Commission, the Company disclaims any intent or
obligation to update publicly these forward looking statements, whether as a
result of new information, future events or otherwise.

      Statements in this report are qualified in their entirety by reference to
contracts, agreements, and other exhibits filed or incorporated with the
Company's Form 10-KSB for the fiscal year ended June 30, 2003 and the Company's
other filings with the Securities and Exchange Commission, including but not
limited to the December 15, 2003 Form 8-K filed concerning the Reorganization
and the April 7, 2004 Form 8-K filed concerning the alleged breach of the Unit
Purchase Agreement, the Stock Purchase Agreement and the resignation of one of
the Company's directors.

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ITEM 3.  CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

      At the end of the period reported on in this report, the Company carried
out an evaluation, under the supervision and participation of the Company's
Chief Executive and Financial Officer (the "Officer") of the effectiveness of
the design and operation of the Company's disclosure controls and procedures
pursuant to Securities Exchange Act Rule 13a-14. Based upon that evaluation, the
Officer concluded that the Company's disclosure controls and procedures are
effective in all material respects, with respect to the recording, processing,
summarizing and reporting, within the time periods specified in the SEC's rules
and forms, of information required to be disclosed by the Company in the reports
the Company files or submits under the Exchange Act.

Internal Controls

      There were no significant changes made in the Company's internal controls
during the quarter ended March 31, 2004, or in other factors that could
significantly affect these controls subsequent to the date of the evaluation
described above.

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                             PART II. OTHER INFORMATION

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

          (a)   EXHIBITS

            EXHIBIT NO. DESCRIPTION

               31   Certificate of Chief Executive and Financial Officer
                    pursuant to Section 302 of The Sarbanes Oxley Act of 2002

               32   Certificate of Chief Executive and Financial Officer
                    pursuant to Section 906 of The Sarbanes-Oxley Act of 2002

          (b)  The Company filed a Current Report on Form 8-K dated April 7,
               2004 under Items 5, 6 and 7 regarding an alleged breach of the
               Unit Purchase Agreement between Regent Entertainment Partnership,
               L.P. and the Company, an alleged breach of the Stock Purchase
               Agreement between four individuals and the Company; and the
               resignation of one of the Company's directors.

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                                   SIGNATURES

      In accordance with the requirements of the Securities Exchange Act of
1934, the registrant has caused this report on Form 10-QSB to be signed on its
behalf by the undersigned, thereunto duly authorized.

                                     ADVANCE DISPLAY TECHNOLOGIES, INC.
                                     (Registrant)




Date: May 24, 2004                   /s/ Matthew W. Shankle
                                     -------------------------------------------
                                     Matthew W. Shankle
                                     President, Chief Executive and
                                     Financial Officer

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