SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB

(Mark One)

[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934
 
                For the quarterly period ended December 31, 1998
 
                                       OR
 
[  ] TRANSITION  REPORT  PURSUANT  TO SECTION  13 OR 15(d) OF THE  SECURITIES
     EXCHANGE ACT OF 1934

          For the transition period from              to              .
                                         -------------   ------------

                          Commission File No. 2-98747-D


                              OXFORD CAPITAL CORP.
         ---------------------------------------------------------------
        (Exact name of small business issuer as specified in its charter)

 
           Nevada                                          87-0421454
-------------------------------                 --------------------------------
(State or other jurisdiction of                (IRS Employer Identification No.)
incorporation or organization)


          4245 North Central Expressway, Suite 300, Dallas, Texas 75205
          -------------------------------------------------------------
               (Address of principal executive offices) (Zip Code)


                                 (214) 520-0100
                           ---------------------------
                           (Issuer's telephone number)


              ---------------------------------------------------- 
              (Former name, former address and former fiscal year,
                         if changed since last report)

     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 requirements for the past 90 days. Yes No X

     As of February  5, 1999,  10,334,668  shares of Common  Stock of the issuer
were outstanding.


<PAGE>

                              OXFORD CAPITAL CORP.

                                      INDEX


                                                                        Page
                                                                        Number
                                                                       --------
PART I - FINANCIAL INFORMATION

  Item 1.  Financial Statements

           Consolidated Balance Sheets - December 31, 1998
             and June 30, 1998...........................................   3

           Consolidated Statements of Operations - For the 
           three months and six months ended December 31, 1998 
           and 1997......................................................   5

           Consolidated Statements of Cash Flows - For the six months
             ended December 31, 1998 and 1997 ...........................   6

           Notes to Consolidated Financial Statements....................   8

  Item 2.  Management's Discussion and Analysis of Financial Condition
              and Results  of Operations.................................  10

PART II - OTHER INFORMATION

  Item 3.  Defaults Upon Senior Securities...............................  17
  Item 6.  Exhibits and Reports on Form 8-K..............................  17

SIGNATURES...............................................................  18

<PAGE>
                                        

                         PART I - FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

                      OXFORD CAPITAL CORP. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                                   (Unaudited)

                                                  December 31,        June 30,
                                                     1998              1998
                                                 --------------    -------------
 Assets                                                

 Current assets:
   Cash                                          $    103,666      $    47,488
   Accrued payroll receivable                       2,050,815        2,313,668
   Accounts receivable, net                           994,830          610,476
   Prepaid expenses and other assets                   92,858           64,194
   Net assets of discontinued operations and
         assets held for disposition                   32,325           32,325
                                                --------------    -------------
                           Total current assets     3,274,494        3,068,151
                                                --------------    -------------

Furniture, fixtures and equipment, net                411,284          427,119
                                                --------------    -------------
                                                
Other assets:
  Goodwill, net                                     4,839,240        5,122,589
  Covenant not to compete, net                          1,991           31,991
  Receivable from related party                         5,000          124,388
                                                --------------    -------------
                           Total other assets       4,846,231        5,278,968
                                                --------------    -------------
                                                
Total assets                                     $  8,532,009      $ 8,774,238
                                                ==============    =============


                        See Notes to Financial Statements


                                       3
<PAGE>

                      OXFORD CAPITAL CORP. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                                   (Unaudited)
                                    (Cont'd)

<TABLE>
                                                                December 31,             June 30,
                                                                    1998                   1998
                                                             -------------------     -----------------
 <S>                                                         <C>                     <C>

 Liabilities and Shareholders' Equity
 
Current liabilities
   Bank overdraft                                            $       243,478         $    201,497
   Accrued payroll payable                                         1,990,649            2,246,288
   Accounts payable - trade                                          127,358              232,099
   Accrued expenses                                                3,136,945            1,867,419
   Payroll taxes payable                                           4,690,423            4,922,187
   Payable to related parties                                        920,269              733,311
   Current portion of capital lease                                    5,201                5,150
   Current portion of long-term debt                                  52,938               23,215
   Notes payable                                                   4,637,113            4,696,836
                                                            -----------------    -----------------
         Total current liabilities                                15,804,374           14,928,022
                                                            -----------------    -----------------

Long-term debt
   Capital lease                                                      15,408               12,343
   Other obligation                                                  456,306              463,739
                                                            -----------------    -----------------
         Total liabilities                                        16,276,088           15,404,084
                                                            -----------------    -----------------

Shareholders' Equity
  Preferred stock                                                          0                    0
  Common stock                                                        10,335               10,335
  Additional paid-in capital                                       1,393,204            1,393,204
  Retained deficit                                                (9,147,618)          (8,033,385)
                                                            -----------------    -----------------
          Total shareholders' equity                              (7,744,079)          (6,629,846)
                                                            -----------------    -----------------
          Total liabilities and shareholders'equity           $    8,532,009         $  8,774,238
                                                            =================    =================
</TABLE>

                        See Notes to Financial Statements


                                       4
<PAGE>


                      OXFORD CAPITAL CORP. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENT OF OPERATIONS
                                   (Unaudited)

<TABLE>

                                                      Three Months Ended                           Six Months Ended
                                                         December 31,                                 December 31,
                                            --------------------------------------     ----------------------------------------
                                                 1998                 1997                    1998                 1997
                                            ------------------  ------------------     -------------------  -------------------
<S>                                          <C>                 <C>                      <C>                 <C>    

    Revenues
        Management fees                       $      90,000      $       90,000           $     180,000        $     369,767
        Employee leasing revenues                28,029,077          26,028,745              54,211,559           33,970,555
                                            ----------------  ------------------     -------------------   ------------------     

    Total revenues                               28,119,077          26,118,745              54,391,559           34,340,322

    Cost of revenues                             26,871,982          24,540,723              51,824,454           32,231,559
                                            ----------------  ------------------     -------------------   ------------------
     
    Gross profit                                  1,247,095           1,578,022               2,567,105            2,108,763
     
    General and administrative                    1,280,183           1,056,329               2,212,394            1,765,551
    Sales and marketing                             397,034             328,933                 720,120              436,382
                                            ----------------  ------------------     -------------------   ------------------

                                                  (430,122)             192,760               (365,409)             (93,170)
                                                               
    Amortization                                    158,137             163,279                 313,358              199,893
    Depreciation                                     34,110              39,085                  73,733               50,128
    IRS penalties and interest                       79,098             158,536                 154,098              317,073
    Interest                                        103,403              97,971                 207,635              129,003
                                             ----------------  ------------------     -------------------   ------------------
    Loss from continuing operations               (804,870)           (266,110)             (1,114,233)            (789,267)

    Income tax expense                                   0                   0                       0                    0
    Net loss from continuing operations           (804,870)           (266,110)             (1,114,233)            (789,267)
                                                  
    Loss from discontinued operations                    0            ( 26,675)                      0             (199,691)
                                             ----------------  ------------------     -------------------   ------------------

    Net loss                                    $  (804,870)       $   (292,785)         $   (1,114,233)        $  (988,958)
                                            ================  ==================     ===================   ==================

    Weighted average shares outstanding          10,334,668          12,939,059              10,334,668           23,007,641
                                           =================  ==================     ===================  ===================

    Basic loss per share                       $     (0.08)       $       (0.02)        $         (0.11)        $      (0.04)
                                           ================= ===================     ===================  ===================
 
</TABLE>

                        See Notes to Financial Statements

                                       5
<PAGE>

                      OXFORD CAPITAL CORP. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)

<TABLE>
                                                             Six Months Ended December 31,
                                                     --------------------------------------------
                                                            1998                   1997
                                                     --------------------- ----------------------
<S>                                                  <C>                    <C>   

Cash Flow From Operating Activities:                 
Net Loss                                                 $(1,114,233)         $    (988,958)
Adjustments to reconcile net loss with net
cash provided by (used in) operating activities
Depreciation and amortization                                 387,091                250,021
Inventory write-down                                                0                 53,495
(Increase) decrease in:
        Accrued payroll receivable                            262,853                415,860
        Accounts receivable                                 (384,354)            (1,242,905)
        Accounts receivable - related party                   119,388                 45,284
        Prepaid expenses                                     (28,664)              (431,286)
Increase (decrease) in:
        Accounts payable - trade                            (104,741)                335,359
        Accrued payroll                                     (255,639)                 34,545
        Accrued expenses                                    1,269,525                893,358
        Payroll taxes payable                               (231,764)                459,525
        Payable to related parties                            186,958                134,339
                                                     -----------------    -------------------
Net cash provided by (used in) operating activities           106,420               (41,363)
                                                     -----------------    -------------------

Cash Flows From Investing Activities:
     Purchases of furniture and equipment                    (57,905)               (29,593)
     Decrease in deferred acquisition costs                         0                 81,991
     Decrease in accounts receivable - Crest                        0                 46,257
                                                     -----------------    -------------------
Net cash provided by (used in) investing activities          (57,905)                 98,655
                                                     -----------------    -------------------
                                                     
Cash Flows From Financing Activities:
    Increase (decrease) in bank overdraft                      41,981              (159,643)
    Reduction of debt                                        (34,317)               (17,115)
                                                     -----------------    -------------------
Net cash provided by (used in) investing activities             7,664              (176,758)
                                                     -----------------    -------------------
Increase in cash                                               56,178              (119,466)

Beginning cash                                                 47,488                437,410
                                                     -----------------    -------------------
                                                     
Ending cash                                               $   103,666        $       317,944
                                                     =================    ===================
 
</TABLE>

                        See Notes to Financial Statements


                                       6
<PAGE>

                      OXFORD CAPITAL CORP. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                                   (Unaudited)
                                    (Cont'd)
<TABLE>

                                                               Six Months Ended December 31,
                                                      -----------------------------------------
                                                            1998                    1997
                                                      ------------------     ------------------
<S>                                                    <C>                    <C>    

Supplemental disclosures of cash flow information   

  Interest paid                                            $     24,086         $      32,231
                                                      ==================     =================

  Income tax paid                                          $          0         $           0
                                                      ==================     =================
                                                       
Non cash investing and financing activities
                                                    
  Purchase of goodwill by issuance
  of short-term and long-term debt                         $          0         $   5,787,846
                                                      ==================     =================
 
  Purchase of furniture and equipment by issuance of
long-term debt                                             $          0         $     282,996
                                                      ==================     =================


</TABLE>

                       See Notes to Financial Statements


                                       7
<PAGE>

                      OXFORD CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

1.   INTERIM PRESENTATION

     The accompanying interim consolidated  financial statements are prepared in
     accordance  with  generally  accepted  accounting  principles  for  interim
     financial  information and with instructions for Form 10-QSB and Rule 10-01
     of  Regulation  S-X. The June 30, 1998 balance  sheet data was derived from
     audited financial  statements  included in Form 10-KSB dated June 30, 1998.
     The  interim  financial  statements  and notes  thereto do not  include all
     information  required  by  generally  accepted  accounting  principles  for
     complete  financial  statements and should be read in conjunction  with the
     financial  statements included in Form 10-KSB for the period ended June 30,
     1998. The interim financial  statements reflect all adjustments of a normal
     recurring  nature which are, in the opinion of management,  necessary for a
     fair presentation of the financial  position,  results of operations and of
     cash flows for the interim periods presented.

2.   PRO FORMA INFORMATION

     During fiscal 1998, Oxford expanded its employee leasing operations through
     the acquisitions of (1) PRC Enterprises,  Inc. ("PRC") effective  September
     1, 1997, (2) Crest Outsourcing,  Inc. ("Crest")  effective October 1, 1997,
     and (3) Webster Leasing,  Inc. ("Webster")  effective December 1, 1997, and
     through a management  arrangement with United Staffing Corporation ("USC").
     In  addition  to  the  aforementioned   acquisitions  during  fiscal  1997,
     management  discontinued  the operations of Safety and Fatigue  Consultants
     International, Inc. ("SFCI") and SFCI's 60% owned subsidiary, The Institute
     of Sleep and Neuroscience, Inc. ("ISN"), effective as of December 31, 1997.
     Expenses  incurred  by SFCI  and  ISN  are  included  in the  statement  of
     operations for the three and six month periods ended December 31, 1997 as a
     loss from discontinued operations.

     The following unaudited pro forma financial information gives effect to the
     combined  historical  results of operations of the Company,  PRC, Crest and
     Webster for the three and six months ended  December 31, 1997,  and assumes
     that  the  acquisitions  had been  effective  as of the  beginning  of such
     periods.  The pro forma information is not indicative of the actual results
     which would have  occurred had the  acquisitions  been  consummated  at the
     beginning of such periods, or of future operations of the Company.  The pro
     forma  financial  information is based on the purchase method of accounting
     and reflects adjustments to eliminate  non-recurring  expenses, to amortize
     the excess  purchase price over the  underlying  value of net assets and to
     reflect additional interest expense.

                                    Three Months Ended        Six Months Ended
                                     December 31, 1997        December 31, 1997

                Revenue              $   27,089,512           $   53,340,031
                Net Loss             $     (294,050)          $     (880,254)
                Loss Per Share       $        (0.02)          $        (0.04)



                                       8
<PAGE>

                      OXFORD CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)
                                    (Cont'd)

3.   COMMITMENTS AND CONTINGENCIES

     On February  25, 1998,  suit was filed by the Company in the U.S.  District
     Court for the Northern  District of Texas in a case styled,  Oxford Capital
     Corp.  v. United  States,  (Docket No.  3-98CV0501-AH).  In that suit,  the
     Company sought  injunctive relief from an alleged wrongful levy against the
     Company by the Internal Revenue Service ("IRS") relating to alleged payroll
     tax obligations of the Company's subsidiary,  Rx Staffing Corporation.  The
     IRS had,  prior to the filing of the suit,  levied bank  accounts of Oxford
     Capital  Corp.  alleging that it was the nominee,  alter ego,  agent and/or
     holder of a  beneficial  interest of Rx Staffing.  The alleged  payroll tax
     deficiency of Rx Staffing is in excess of $5 million.

     The court issued a temporary  restraining order on March 9, 1998, which was
     then  superceded  after  hearing,  by the  court's  denial  of a  temporary
     injunction  on March  19,  1998.  After a trial on the  merits on August 7,
     1998,  the court denied the Company a permanent  injunction  and found that
     the levy was  appropriate.  The Company filed a notice of appeal on October
     5, 1998,  and is  appealing  the  judgment  to the Fifth  Circuit  Court of
     Appeals.

     In February of 1998, suit was filed against the Company's subsidiaries,  Rx
     Staffing,  PRC, and Webster, in the District Court of Dallas County, Texas,
     191st Judicial  District,  in a case styled,  Liberty Mutual Fire Insurance
     Co. v. Rx Staffing  Corporation,  et al.  (Cause No. DV  98-1321).  In that
     suit,  the  plaintiff is seeking  $1.9  million  based on claims for unpaid
     workers'   compensation  and  employers'   liability   insurance  premiums.
     Management  believes that the Company has good defenses and offsets against
     the claim and is vigorously contesting the matter.

     At  December  31,  1998,  the  Company  was  in  default  with  respect  to
     obligations owed relating to its  acquisitions of PRC and Crest.  Notice of
     intent  to  foreclose  the PRC note has been  given  and  negotiations  are
     presently ongoing with respect to curing the default.

     In addition to the  foregoing,  the  Company is subject to  threatened  and
     pending  litigation and disputes  arising in the normal course of business.
     Other than the foregoing,  management  believes that any such threatened or
     pending actions will not materially affect the Company.

4.   POTENTIAL SALE OF OPERATING SUBSIDIARIES

     Among the various  efforts  being  undertaken by the Company to address its
     ongoing default on the PRC note and substantial debt burden, management has
     initiated discussions with various entities with respect to the sale of one
     or more of the Company's subsidiaries,  including PRC. As a result of those
     discussions,  the Company has entered into  preliminary  agreements to sell
     substantially  all  of the  assets  of  each  of  its  principal  operating
     subsidiaries.




                                       9
<PAGE>


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

Certain Factors Pertaining to Forward Looking Statements

     The  statements  contained  herein  which  are  not  historical  facts  are
forward-looking  statements  that involve various risks and  uncertainties.  All
phases of the  Company's  operations  are subject to a number of  uncertainties,
risks and other influences.  Therefore,  the actual results of the future events
described in such  forward-looking  statements  in this Form 10-QSB could differ
materially  from  those  stated in such  forward-looking  statements.  Among the
factors which could cause the actual results to differ  materially are the risks
and  uncertainties  described both in this Form 10-QSB and the uncertainties set
forth from time to time in the  Company's  other  public  reports,  filings  and
public statements.  Many of these factors are beyond the control of the Company,
any of which, or a combination of which,  could materially affect the results of
the Company's operations and whether the forward-looking  statements made by the
Company ultimately prove to be accurate.

Results of Operations

     The following table sets forth, for the periods indicated, certain selected
statement  of  operations'  data  expressed as a  percentage  of  revenues.  The
following  discussion  should be read in conjunction  with the Company's  annual
report on Form 10-KSB for the year ended June 30, 1998, as well as the unaudited
consolidated  financial  statements and notes thereto included in this quarterly
report on Form 10-QSB.

                                       Three Months Ended      Six Months Ended
                                            December 31,          December 31, 
                                        1998         1997      1998        1997

Employee leasing revenue..............   99.7%       99.7%     99.7%       98.9%
Management fees.......................    0.3         0.3       0.3         1.1
                                        ------      ------    ------      ------
Total revenues........................  100.0       100.0     100.0       100.0
Direct costs..........................  (95.6)      (94.0)    (95.3)      (93.9)
                                        ------      ------    ------      ------
Gross profit..........................    4.4         6.0       4.7         6.1
General and administrative expense....   (4.6)       (4.0)     (4.0)       (5.1)
Sales and marketing expense...........   (1.4)       (1.3)     (1.3)       (1.3)
Other expenses (net)..................   (1.3)       (1.7)     (1.4)       (2.0)
Loss from discontinued operations.....   (0.0)       (0.1)     (0.0)       (0.6)
                                        ------      ------    ------      ------
Net loss..............................   (2.9)       (1.1)     (2.0)       (2.9)
                                        ======      ======    ======      ======


                                       10
<PAGE>

Three months ended December 31, 1998 compared to three months ended December 31,
1997
 
     Revenues.  Total revenues for the three months ended December 31, 1998 were
$28.1 million  compared to $26.1 million for the three months ended December 31,
1997, an increase of $2.0 million,  or 7.7%. Employee leasing revenues increased
by 7.7% from $26.0 million in the three months ended  December 31, 1997 to $28.0
million in three months ended  December 31, 1998.  Management  fees  amounted to
$0.1 million for both the three months ended December 31, 1998 and 1997.

     The  increase  in  total  revenues  and  employee   leasing   revenues  was
principally attributable to the acquisition of Webster, which accounted for $1.6
million of employee  leasing  revenues  for the three  months of the fiscal 1999
period compared to $0.5 million of employee  leasing revenues of Webster for one
month only  included in the fiscal 1998 period,  and a $4.7 million  increase in
PRC's employee leasing revenues. Partially offsetting these increases was a $3.9
million decrease in Rx Staffing employee leasing revenues during the fiscal 1999
period,  principally  attributable  to the  termination  during fiscal 1998 of a
major client which accounted for approximately 25% of Rx Staffing's  business in
the fiscal 1998 period.

     The average  number of worksite  employees  paid per month during the three
months ended  December 31, 1998 period was 4,513 as compared to 4,213 during the
three  months  ended  December  31,  1997,  while  monthly  revenue per worksite
employee was $2,070  during the fiscal 1999 period as compared to $2,059  during
the fiscal 1998 period.

     On a pro forma basis,  assuming the  acquisitions of PRC, Crest and Webster
as of July 1, 1997,  total revenues for the three months ended December 31, 1997
amounted to $27.1  million.  Actual  revenues  for the current  period were $0.9
million  greater  than the fiscal  1998  period pro forma  revenue,  principally
reflecting the  aforementioned  $4.1 million  increase in PRC's employee leasing
revenues,  partially offset by a $3.9 million  decrease in Rx Staffing  employee
leasing revenues.

     Gross  Profit.  Gross profit  amounted to $1.2 million for the three months
ended  December  31, 1998  compared to $1.5  million for the three  months ended
December 31, 1997, a decrease of $0.3 million,  or 21.0%. This decrease in gross
profit was principally  attributable  to a $0.5 million  decrease in Rx Staffing
gross profit resulting from its aforementioned decline in revenues, offset by an
increase  in gross  profit of $0.2  million  for PRC.  Gross  margin was 4.4% of
revenues  during the fiscal 1998 period  compared to 6.0% during the fiscal 1997
period.  The  decrease  in gross  margin  during  fiscal  1998  was  principally
attributable  to lower gross  margins  generated by Rx Staffing and Webster as a
result of higher workers compensation insurance expense.

     Monthly gross mark-up per worksite  employee  averaged $92 during the three
months  ended  December  31,  1998,  as compared to $125 during the three months
ended December 31, 1997.

     General and Administrative  Expense.  General and  administrative  expenses
("G&A")  totaled  $1.3  million for the three  months  ended  December 31, 1998,
compared to $1.1  million for the three  months  ended  December  31,  1997,  an
increase  of $0.2  million,  or  21.2%.  The  increase  in G&A  was  principally
attributable to a charge of $0.3 million by PRC for  performance  bonuses agreed
to in  connection  with the  negotiations  concerning  the PRC note  default and
forbearance  of foreclosure  thereon.  Additionally,  somewhat  higher G&A costs
associated  with  supporting  expanded  operations  were offset by a decrease in
certain unusual and non-recurring expenses incurred in the year ago period. As a
percentage  of  revenues,  G&A  increased  to 4.6% from  4.0%,  as  efficiencies
attributable to changes in operating  procedures  instituted in fiscal 1998 were
offset by the charge by PRC described above.


                                       11
<PAGE>

     Sales and Marketing Expense.  Sales and marketing expenses amounted to $0.4
million for the three months ended  December 31, 1998,  compared to $0.3 million
for the three months ended  December 31, 1997, an increase of $0.1  million,  or
20.7%.  The increase is  principally  attributable  to higher sales  expenses at
Crest. As a percentage of revenues,  sales and marketing  expense increased from
1.3% to 1.4%.

     Other Expense (Net).  Other expenses were $0.4 million for the three months
ended  December  31,  1998,  compared to $0.5 million for the three months ended
December 31, 1997.  The decrease is principally  attributable  to lower accruals
for IRS interest charges for the three months ended December 31, 1998,  compared
to the year ago period which also  reflected IRS penalty  charges in addition to
interest charges.

     Loss  from  Discontinued  Operations.  The  Company  recorded  a loss  from
discontinued operations of $26,675 for the three months ended December 31, 1997.
The loss from discontinued operations relates to the termination,  during fiscal
1998, of the operations of SFCI.

     Net Loss.  The  Company  reported a net loss of $0.8  million for the three
months ended  December  31, 1998,  compared to $0.3 million for the three months
ended December 31, 1997.

     On a pro forma basis,  assuming the  acquisitions of PRC, Crest and Webster
as of July 1, 1997, the net loss during the fiscal 1998 period  amounted to $0.3
million, an amount equal to the actual net loss .

Six months ended December 31, 1998 compared to the six months ended December 31,
1997

     Revenues.  Total  revenues for the six months ended  December 31, 1998 were
$54.4 million  compared to $34.3  million for the six months ended  December 31,
1997,  an  increase  of $20.1  million,  or  58.4%.  Employee  leasing  revenues
increased by $20.2 million, or 59.6%, from $34.0 million in the six months ended
December  31,  1997 to $54.2  million in six months  ended  December  31,  1998.
Management fees decreased from $0.4 million in the six months ended December 31,
1997 to $0.2 million for six months ended December 31, 1998.

     The  increase  in  total  revenues  and  employee   leasing   revenues  was
attributable to the  acquisition of PRC, Crest and Webster,  which accounted for
an aggregate of $51.8  million of employee  leasing  revenues  during the fiscal
1999 period compared to $24.1 million of employee leasing  revenues  included in
the fiscal 1998 period.  Partially  offsetting the increase in employee  leasing
revenues  attributable to acquisitions  was a $7.4 million  decrease in employee
leasing  revenues  of Rx  Staffing  during  the  fiscal  1999  period  which was
attributable  to the  termination  during  fiscal 1998 period of a major  client
which accounted for  approximately  25% of Rx Staffing's  business in the fiscal
1998 period.  The lower  management  fee total for the six months ended December
31, 1998 as compared to the six months ended December 31, 1997, is  attributable
to the performance of management services for Crest in the year ago period only,
prior to the closing of its purchase by the Company effective October 1, 1997.


                                       12
<PAGE>

     The average  number of  worksite  employees  paid per month  during the six
months ended  December 31, 1998 period was 4,592 as compared to 2,908 during the
six months ended December 31, 1997, while monthly revenue per worksite  employee
was $1,968 during the fiscal 1999 period as compared to $1,946 during the fiscal
1998 period.

     On a pro forma basis,  assuming the  acquisitions of PRC, Crest and Webster
as of July 1, 1997,  total  revenues for the six months ended  December 31, 1997
amounted to $53.3  million,  or $0.9 million  less than actual  revenues for the
current period. The increase in actual as compared to pro forma revenues results
from an increase in PRC employee  leasing  revenue of $8.8 million,  offset by a
decrease in Rx Staffing and Crest employee  leasing  revenue of $7.4 million and
$0.3 million, respectively.

     Gross  Profit.  Gross  profit  amounted to $2.6  million for the six months
ended  December  31,  1998  compared to $2.1  million  for the six months  ended
December 31, 1997, an increase of $0.5 million,  or 21.7%. The increase in gross
profit was primarily  attributable  to the acquisition of PRC, Crest and Webster
during fiscal 1998,  partially offset by a $0.8 million decrease  resulting from
the  aforementioned  decline in Rx Staffing  revenues.  Gross margin was 4.7% of
revenues  during the fiscal 1998 period  compared to 6.1% during the fiscal 1997
period.  The  decrease  in gross  margin  during  fiscal  1998  was  principally
attributable to the lower gross margin generated by Rx Staffing and Webster as a
result of higher workers compensation insurance expense.

     Monthly  gross  mark-up per worksite  employee  averaged $93 during the six
months ended  December 31, 1998, as compared to $118 during the six months ended
December 31, 1997.

     General and Administrative  Expense.  General and  administrative  expenses
("G&A")  totaled  $2.2  million  for the six months  ended  December  31,  1998,
compared to $1.8 million for the six months ended December 31, 1997, an increase
of  $0.4  million,  or  25.3%.  The  increase  in G&A  expense  was  principally
attributable to the aforementioned charge of $0.3 million by PRC for performance
bonuses,  as well as the  acquisitions  of PRC, Crest and Webster and associated
costs of supporting such operations, offset by a decrease in certain unusual and
non-recurring  expenses  incurred in the year ago  period.  As a  percentage  of
revenues,  G&A  decreased  from  5.1%  to  4.1%,  attributable  to  efficiencies
associated with operating on a larger scale, offset in part by the PRC charge.

     Sales and Marketing Expense.  Sales and marketing expenses amounted to $0.7
million for the six months ended December 31, 1998, compared to $0.4 million for
the six months ended  December 31, 1997, an increase of $0.3 million,  or 65.0%.
The increase in sales and marketing  expense was attributable to the acquisition
of PRC, Crest and Webster and associated costs of supporting such operations. As
a percentage  of revenues,  sales and  marketing  expense  remained  essentially
unchanged at 1.3%.

     Other  Expense  (Net).  Other  expenses were $0.7 million for the six month
period  ended  December  31,  1998 as well as for  the six  month  period  ended
December 31, 1997. Higher  amortization  expense ($0.1 million) for goodwill and
interest  expense  ($0.1  million)  for  debt  arising  in  connection  with the
aforementioned  acquisitions  was  offset by lower IRS  penalties  and  interest
charges.


                                       13
<PAGE>

     Loss  from  Discontinued  Operations.  The  Company  recorded  a loss  from
discontinued  operations  of $0.2 million for the six months ended  December 31,
1997. The loss from discontinued  operations relates to the termination,  during
fiscal 1998, of the operations of SFCI.

     Net Loss.  The  Company  reported  a net loss of $1.1  million  for the six
months  ended  December  31,  1998,  compared to $1.0 million for the six months
ended December 31, 1997.

     On a pro forma basis,  assuming the  acquisitions of PRC, Crest and Webster
as of July 1, 1997, the net loss during the fiscal 1998 period  amounted to $0.9
million.  The $0.2  million  increase  in the  actual net loss for the six month
period ended December 31, 1998 compared to the pro forma net loss is principally
attributable to the Company's  efforts to terminate client contracts that do not
meet its  profitability  criteria,  offset by greater levels of certain expenses
incurred in the 1998 period,  such as  professional  fees and IRS  penalties and
interest, and the aforementioned PRC charge.

Liquidity and Capital Resources

     The Company had cash of $103,666 and a deficit in working  capital of $12.5
million at December 31, 1998,  compared to a cash balance of $47,488 and working
capital deficit of $11.9 million at June 30, 1998. The increase in the Company's
working capital deficit is principally  attributable to the loss incurred during
the period,  an increase in accrued  expenses and a decrease in accrued  payroll
receivable  and  accounts  receivable-related  parties,  offset by  decreases in
accounts  payable,  accrued  payroll  payable and payroll taxes payable,  and an
increase in accounts receicable-clients.

     Cash flows provided by (used in) operating activities were $106,420 for the
six  months  ended   December  31,  1998  as  compared  to  ($41,363)   for  the
corresponding  period of the prior year. This improvement for the current period
resulted  from a greater  increase  in accrued  expenses,  a lower  increase  in
accounts   receivable-clients   and  a  smaller   increase  in  accrued  payroll
receivable,  offset by a greater net loss,  and  decreases in accounts  payable,
accrued payroll payable and payroll taxes payable.

     Cash provided by (used in) investing  activities  totaled ($57,905) for the
six months  ended  December  31,  1998 as compared to $93,656 for the six months
ended December 31, 1997. The change resulted principally from decreases in other
assets.

     Cash  provided  by (used in)  financing  activities  was $7,664 for the six
months ended  December 31, 1998 compared to ($171,758)  for the six months ended
December  31,  1997.  The change  resulted  primarily  from an  increase  in the
Company's  bank  overdraft  position  in the  current  period as  compared  to a
decrease in the earlier period.

     At December 31, 1998, the Company's principal obligations, other than those
relating  to meeting its  ongoing  working  capital  needs,  consisted  of (1) a
non-interest  bearing note payable in connection with the Company's  acquisition
of Rx Staffing,  (2) a note payable in connection  with the  acquisition of PRC,
and (3) a note payable in connection with the acquisition of Crest.


                                       14
<PAGE>

     At December  31,  1998,  the  discounted  balance of the note  payable with
regard to the Rx Staffing acquisition was $456,000.  As of February 5, 1999, the
Company  was in default  under the terms of the notes  payable  relating  to the
acquisitions  of both PRC and Crest.  Notice of intent to foreclose the PRC note
has been given and negotiations are presently ongoing with respect to curing the
default.

     Additionally, at December 31, 1998, the Company continued to be involved in
legal  proceedings  with the IRS in connection with the IRS's efforts to collect
approximately $5 million of delinquent  payroll taxes and related  penalties and
interest which it contends are owed by Oxford Capital.  In the event the Company
is unsuccessful  in its efforts to settle the alleged payroll tax  deficiencies,
the Company does not have the financial  resources to pay the amounts  allegedly
owing and support its ongoing operations.

     If the Company is unable to substantially improve operating results, secure
additional financing,  negotiate more favorable payment terms with its creditors
or sell assets on  favorable  terms,  the Company may be unable to continue  its
present  operations.  The Company is presently  negotiating with the IRS and the
former  shareholders  of PRC to secure  more  favorable  terms  with  respect to
payment of amounts owed to such  creditors.  Absent an agreement in that regard,
the former  shareholders of PRC may foreclose on their security interest and the
Company  would lose its  ownership  interest in PRC and the IRS may levy against
assets of the Company to satisfy delinquent payroll tax obligations.

Known Risks and Uncertainties Regarding Future Operations

     During the six months ended  December 31, 1998,  the  Company's  operations
continued to produce  substantial  losses. At December 31, 1998, the Company was
in default with respect to obligations  owed relating to its  acquisition of PRC
and Crest. Additionally, the Company owed approximately $5 million to the IRS.

     Given the Company's continuing losses and substantial debt,  management has
initiated  discussions  with various entities with respect to the sale of one or
more of the  Company's  subsidiaries.  As a  result  of those  discussions,  the
Company has entered into preliminary agreements to sell substantially all of the
assets of each of its principal  operating  subsidiaries.  Management  presently
anticipates  that the  assets  and  operations  of PRC will be sold  during  the
quarter ended March 31, 1999 and that the assets and  operations of Rx,  Webster
and Crest will be sold  shortly  after the closing on the sale of PRC,  possibly
also closing during the quarter ended March 31, 1999.

     In the event the Company is  successful  in its efforts to sell one or more
of its operating subsidiaries, or assets of those subsidiaries, the Company will
experience a potentially substantial decrease in revenues going forward. The net
effect  of any such  sale on the  operating  results  of the  Company  cannot be
predicted.  In the absence of such a sale,  it is possible that the Company will
lose one or more of its operating  subsidiaries through foreclosure or otherwise
without  receiving  consideration and that the Company will be unable to sustain
its operations given the recurring losses and substantial  debts of the Company.
Even if the  Company  is  successful  in  selling  one or more of its  operating
subsidiaries,  it is possible  that the Company will have  inadequate  financial
resources and operating cash flows to continue the operations of the Company.


                                       15
<PAGE>

Year 2000 Issue

     As the Company's  operations rely on several internal  computer systems and
third party vendor relationships,  the Company believes that the Year 2000 issue
presents potentially  significant  operational issues if not properly addressed.
The Year 2000 issue  generally  describes  the various  problems that may result
from the failure of computer and other  mechanical  systems to properly  process
certain dates and date sensitive information.

     The Company has not incurred and does not expect to incur significant costs
related  to Year  2000  issues  other  than the time of  internal  personnel  to
complete the Company's Year 2000 plans.

     The Company  believes that the risks associated with Year 2000 issues would
primarily affect the areas of payroll processing, electronic funds transfers and
the  dissemination  of  benefits  appropriate  planning  and  testing  are:  the
inability to transmit  direct deposit payroll through banking systems to deposit
funds into worksite  employees'  bank  accounts;  the inability to collect funds
electronically in payment of the Company's service fees; the failure to properly
calculate payroll information;  the untimely transmission of benefits enrollment
or claims  data to and from  benefit  providers;  and the  inability  to deliver
payroll checks to employees due to failure in transportation or courier systems.
As a result, the Company's plans,  including the testing of its systems,  vendor
assessment and contingency planning, will be focused in these areas.

     The Company has previously developed a disaster recovery plan to be used in
the  event of  unexpected  business  interruptions.  The  Company  is  currently
developing specific contingency plans, to complement its disaster recovery plan,
for those processes that are considered crucial in preventing an interruption of
business operations as a result of Year 2000 issues.

     The Company's  Year 2000 plans,  as discussed  above,  represent an ongoing
process which will continue throughout 1999. Although the Company believes it is
taking the appropriate  courses of action to ensure that material  interruptions
in  business  operations  do not occur as a result of the Year 2000  conversion,
there  can be no  assurances  that the  action  discussed  herein  will have the
anticipated  results or that the  Company's  financial  condition  or results of
operations will not be adversely affected as a result of Year 2000 issues. Among
the factors which might affect the success of the Company's Year 2000 plans are:
(1) the  Company's  ability to  properly  identify  deficient  systems;  (2) the
ability of third parties to adequately address Year 2000 issues or to notify the
Company of  potential  deficiencies;  (3) the  Company's  ability to  adequately
address any such internal or external deficiencies; (4) the Company's ability to
complete its Year 2000 plans in a timely  manner;  and (5)  unforeseen  expenses
related to the Company's Year 2000 plans.


                                       16
<PAGE>


Seasonality, Inflation and Quarterly Fluctuations

     Historically,  the Company's  earnings  pattern has included  losses in the
first calendar quarter (the Company's third quarter ended March 31), followed by
improved profitability in subsequent quarters throughout the calendar year. This
pattern is due to the  effects of  employment-related  taxes  which are based on
each  employee's  cumulative  earnings  up to  specified  wage  levels,  causing
employment-related  taxes to be highest in the first  quarter  and then  decline
over the  course  of the  year.  Since  the  Company's  revenues  related  to an
individual  employee are generally earned and collected at a relatively constant
rate throughout each year,  payment of such  employment-related  tax obligations
has a  substantial  impact on the Company's  financial  condition and results of
operations during the first six months of each calendar year. Other factors that
affect direct costs could mitigate or enhance this trend.

                           PART II - OTHER INFORMATION

Item 3.  Default Upon Senior Securities

     A note  payable  in the amount of  $4,500,000  issued as  consideration  in
connection with the acquisition of PRC is in default as of February 5, 1999. The
event of default is the Company's  failure to make the initial annual  principal
and interest payment of approximately  $480,000 due September 30, 1998. The note
is collateralized by shares of PRC stock,  bears interest at 8%, requires annual
payments of principal and interest in an amount equal to the greater of $450,000
or 30% of the gross profits of PRC, and requires payment of unpaid principal and
interest in September 2000. Notice has been given by the holders of their intent
to foreclose.

Item 6.  Exhibits and Reports on Form 8-K

     (a)  Exhibits

          27.1 Financial Data Schedule

     (b)  Reports on Form 8-K

          None


                                       17
<PAGE>
                                   SIGNATURES

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

                                               OXFORD CAPITAL CORP.


Date: February 22, 1999               By: /s/ Robert Cheney   
                                         ------------------------------------
                                          Robert Cheney, Chairman and
                                          Principal Executive Officer


Date: February 22, 1999               By: /s/ Jerry Stovall                  
                                         ------------------------------------
                                          Jerry Stovall, Treasurer and
                                          Principal Financial Officer


                                       18