U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB

[X]  Quarterly report pursuant to Section 13 or 15(d) of the Securities
     Exchange Act of 1934

     For the quarterly period ended December 31, 1998

[ ]  Transition  report  pursuant  to Section  13 or 15(d) of the  Securities
     Exchange Act of 1934

     For the transition period from _______________ to _______________

     Commission File number 33-58694

                             FBR CAPITAL CORPORATION
        (Exact Name of Small Business Issuer as Specified in its Charter)

         Nevada                                                  13-3465289
(State of Other Jurisdiction of                               (I.R.S. Employer
Incorporation of Organization)                               Identification No.)

           14988 North 78th Way, Suite 203, Scottsdale, Arizona 85260
                    (Address of Principal Executive Offices)

                                  (602)483-1466
                 (Issuer's Telephone Number Including Area Code


              (Former Name, Former Address and Former Fiscal Year,
                          if Changed Since Last Report


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

     State the number of shares  outstanding of each of the issuer's  classes of
common equity,  as of the latest  practicable date: At February 16, 1999, Issuer
had outstanding 4,648,205 shares of Common Stock, par value $.005 per share.

Transitional Small Business Disclosure Format:  Yes  [ ]  No [X]

                             Page 1 of 10 Total Pages
                              Exhibit Index - None
<PAGE>
PART 1.     FINANCIAL INFORMATION
ITEM 1.     FINANCIAL STATEMENTS

                             FBR CAPITAL CORPORATION

                                 BALANCE SHEETS



                                                      DECEMBER 31     JUNE 30
ASSETS                                                   1998          1998
                                                         ----          ----
                                                      (UNAUDITED)
CURRENT ASSETS:
   Cash and cash equivalents                          $     1,374   $    15,223
   Investment in U.S. Government Treasury Bills           270,240       275,670
   Investment in common stock of Parlux
     Fragrances, Inc.                                      14,237        53,541
   Other current assets                                     1,656         4,536
                                                      -----------   -----------

TOTAL ASSETS                                          $   287,507   $   348,970
                                                      ===========   ===========
LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES:
   Accounts payable                                   $     6,506   $     4,691
   Accrued expenses                                        11,274         9,449
   Convertible notes payable                               19,500        19,500
                                                      -----------   -----------

              Total current liabilities                    37,280        33,640
                                                      -----------   -----------
SERIES A REDEEMABLE PREFERRED STOCK:
   $.01 par value;
      529 shares authorized;
      2 shares issued and outstanding;
      at liquidation value of $5,600 per share             11,200        11,200
                                                      -----------   -----------
STOCKHOLDERS' EQUITY (DEFICIT):
   Preferred stock, $.01 par value;
      10,000,000 shares authorized;
      no shares outstanding except 2 shares issued
       as Series A Redeemable Preferred Stock                  --            --
   Common stock, $.005 par value;
      16,777,667 shares authorized;
      4,648,205 shares issued and outstanding              23,241        23,241
   Additional paid-in capital                           9,337,192     9,337,192
   Accumulated deficit                                 (9,013,461)   (8,834,150)
   Accumulated other comprehensive loss                  (107,945)     (222,153)
                                                      -----------   -----------

              Total stockholders' equity                  239,027       304,130
                                                      -----------   -----------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY            $   287,507   $   348,970
                                                      ===========   ===========

      The accompanying notes are an integral part of these balance sheets.

                                       -2-
<PAGE>
                             FBR CAPITAL CORPORATION

                            STATEMENTS OF OPERATIONS
                   SIX MONTHS ENDED DECEMBER 31, 1998 AND 1997
                                   (UNAUDITED)


                                                        1998            1997
                                                        ----            ----

Operating expenses                                   $   (52,207)   $   (72,927)
                                                     -----------    -----------

    Loss from operations                                 (52,207)       (72,927)
                                                     -----------    -----------
Other income (expense):
   Interest expense                                       (1,475)            --
   Interest income                                         6,227          9,528
   Other income                                               --          1,304
   Realized loss on disposal of Parlux
     common stock                                       (131,856)            --
                                                     -----------    -----------

     Other income (expense), net                        (127,104)        10,832
                                                     -----------    -----------

   Net loss                                             (179,311)       (60,069)

Other comprehensive loss:
   Unrealized loss on investment:
     Unrealized holding loss arising during period       (18,435)       (23,704)
                                                     -----------    -----------

   Comprehensive loss                                $  (197,746)   $   (83,773)
                                                     ===========    ===========

Loss per common share and common share equivalents   $      (.04)   $      (.01)
                                                     ===========    ===========

Weighted average common share and common share
 equivalents outstanding                               4,648,205      4,648,205
                                                     ===========    ===========


        The accompanying notes are an integral part of these statements.

                                       -3-
<PAGE>
                             FBR CAPITAL CORPORATION

                            STATEMENTS OF OPERATIONS
                  THREE MONTHS ENDED DECEMBER 31, 1998 AND 1997
                                   (UNAUDITED)


                                                        1998           1997
                                                        ----           ----

Operating expenses                                  $   (20,418)   $   (29,621)
                                                    -----------    -----------

      Loss from operations                              (20,418)       (29,621)
                                                    -----------    -----------
Other income (expense):
   Interest expense                                        (737)            --
   Interest income                                        2,969          4,640
   Realized loss on disposal of Parlux common stock    (131,856)            --
                                                    -----------    -----------

      Other income (expense), net                      (129,624)         4,640
                                                    -----------    -----------

   Net loss                                            (150,042)       (24,981)

Other comprehensive loss:
   Unrealized loss on investment:
     Unrealized holding loss arising during period      (16,062)        (2,288)
                                                    -----------    -----------

   Comprehensive loss                               $  (166,104)   $   (27,269)
                                                    ===========    ===========

Loss per common share and common share equivalents  $      (.03)   $      (.01)
                                                    ===========    ===========

Weighted average common share and common share
 equivalents outstanding                              4,648,205      4,648,205
                                                    ===========    ===========

        The accompanying notes are an integral part of these statements.

                                       -4-
<PAGE>
                            FBR CAPITAL CORPORATION

                            STATEMENTS OF CASH FLOWS
                   SIX MONTHS ENDED DECEMBER 31, 1998 AND 1997
                                   (UNAUDITED)


                                                            1998         1997
                                                            ----         ----
CASH FLOWS FROM OPERATING ACTIVITIES:
 Net loss                                                 $(179,311)   $(60,069)
                                                          ---------    --------
 Adjustments to reconcile net loss to net cash
  provided by (used in) operating activities:
    Realized loss on disposal of Parlux common stock        153,512          --
    (Increase) decrease in:
      Other current assets                                    2,880       1,694
    Increase (decrease) in:
      Accounts payable and accrued expenses                   3,640       3,329
                                                          ---------    --------

      Total adjustments                                     160,032       5,023
                                                          ---------    --------

      Net cash used in operations activities                (19,279)    (55,046)
                                                          ---------    --------
CASH FLOWS FROM INVESTING ACTIVITIES:
 Receipts of amount due from acquiror of discontinued
  operations                                                     --          --
 Investment in U.S. Government Treasury Bills                    --          --
 Proceeds from sale of U.S. Government Treasury Bills         5,430      57,278
                                                          ---------    --------

      Net cash provided by investing activities               5,430      57,278
                                                          ---------    --------

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS        (13,849)      2,232

CASH AND CASH EQUIVALENTS, beginning of period               15,223      10,238
                                                          ---------    --------

CASH AND CASH EQUIVALENTS, end of period                  $   1,374    $ 12,470
                                                          =========    ========

        The accompanying notes are an integral part of these statements.

                                       -5-
<PAGE>
                             FBR CAPITAL CORPORATION

                          NOTES TO FINANCIAL STATEMENTS
                       SIX MONTHS ENDED DECEMBER 31, 1998
                                   (UNAUDITED)


SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION

The accompanying unaudited financial statements have been prepared in accordance
with generally accepted accounting  principles for interim financial information
and the  instructions to Form 10-QSB.  Accordingly,  they do not include all the
information and footnotes required by Generally Accepted  Accounting  Principles
("GAAP") for complete financial  statements.  In the opinion of management,  all
adjustments  (which include only normal recurring  adjustments)  necessary for a
fair  presentation  of the results for the interim  periods  presented have been
made.  The results for the six month and three month periods ended  December 31,
1998 may not be indicative of the results for the entire year.  These  financial
statements  should be read in  conjunction  with the Company's  Annual Report on
Form 10-KSB for the fiscal year ended June 30, 1998.

CASH AND CASH EQUIVALENTS AND INVESTMENTS

The Company's  policy is to invest cash in excess of operating  requirements  in
income-producing  investments.  Temporary cash investments are all highly liquid
investments  with  maturity  of three  months  or less  when  purchased  and are
considered to be cash  equivalents  for cash flow  purposes.  Investments in the
common stock of Parlux Fragrances,  Inc., and U.S. Government Treasury Bills are
accounted for in accordance with Statement of Financial Accounting Standards No.
115, "Accounting for Certain Investments in Debt and Equity Securities".

Investment  in  common  stock of  Parlux  Fragrances,  Inc.,  is  classified  as
"available  for  sale".  Changes  in  the  market  value  are  reflected  in the
stockholders'  equity  section of the Company's  balance sheet under the caption
"Accumulated  Other  Comprehensive   Loss",  in  accordance  with  Statement  of
Financial Accounting Standards No. 130, Reporting Comprehensive Income.

EARNINGS (LOSS) PER COMMON SHARE

Earnings  (loss) per common share is computed by dividing  net income  (loss) by
the  weighted  average  number of  common  share and  common  share  equivalents
outstanding during the period.  Primary and fully diluted earnings per share are
considered to be the same in all periods. The impact of outstanding warrants and
stock options were not included in the calculation of net loss per share in 1998
and 1997 as their inclusion would have an anti-dilutive effect on those results.

INCOME TAXES

The Company has a net operating loss carryforward of approximately $6,800,000 at
December 31, 1998. Historically, no federal tax benefit has been recorded due to
the  uncertainty  of the  Company's  ability to realize  benefits by  generating
taxable income in the future. These carryforwards expire through fiscal year

                                       -6-
<PAGE>
                             FBR CAPITAL CORPORATION

                          NOTES TO FINANCIAL STATEMENTS
                       SIX MONTHS ENDED DECEMBER 31, 1998
                                   (UNAUDITED)


2013.  Due to a greater  than 50% change in the  ownership  of the  Company,  as
defined in the Internal Revenue Code,  resulting from various equity  offerings,
certain  restrictions exist as to the use of net operating loss carryforwards to
offset future taxable income.

Although the Company has significant net operating loss carryforwards  available
to offset future  taxable  income,  due to the  uncertainty  as to the Company's
future  earnings,  a full  valuation  allowance  has been provided to offset all
deferred  tax  assets.  No income  taxes  have been  provided  for either of the
interim periods based on the Company's ability to utilize its net operating loss
to offset taxable income, if any, during the periods.

RECENTLY ISSUED ACCOUNTING STANDARD

During 1998, the Company adopted Financial  Accounting Standards Board Statement
NO. 130,  Reporting  Comprehensive  Income (SFAS No. 130). SFAS No. 130 requires
the reporting of comprehensive income in addition to net income from operations.
Comprehensive  income is a more inclusive financial  reporting  methodology that
includes disclosures of certain financial  information that historically has not
been recognized in the calculation of net income.

At  December  31,  1998,   the  Company  held  an   investment   classified   as
available-for-sale,  which has an unrealized  loss of $18,435 for the six months
ended December 31, 1998.

SUBSEQUENT EVENT

On February  16,  1999,  the Company  agreed in  principle to acquire all of the
outstanding shares of Vitrix  Incorporated  ("Vitrix"),  a private  corporation,
that is a developer  and  provider of software  and  hardware for time and labor
management  solutions for businesses of all sizes.  Vitrix products are designed
to improve  productivity by automating  collection of time and attendance  data,
staff scheduling and management of labor resources.

FBR will acquire the Vitrix shares for a combination of newly-issued  FBR common
stock and Series B FBR  preferred  shares that are  convertible  into FBR common
shares. Under the proposed transaction, after issuance and conversion of the FBR
shares,  the Vitrix  shareholders will own 80% of the outstanding  shares of FBR
and the current  shareholders  of FBR will own 20%. FBR  currently has 4,648,205
shares issued and  outstanding.  The proposed  transaction is subject to certain
conditions  including  negotiation of a definite agreement and is subject to the
approval of the Board of Directors  of FBR and the written  approval of at least
90% of the Vitrix shareholders.

                                       -7-
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSIONS AND ANALYSIS OF FINANCIAL CONDITION AND PLAN
        OF OPERATIONS

PLAN OF OPERATIONS

On June 28, 1996, the Company sold to Parlux Fragrances, Inc. (Parlux) virtually
all of the assets, properties and rights owned by the Company in connection with
its business for cash,  shares of the common stock of Parlux  (Parlux stock) and
other consideration.

The Company has not conducted any operations since the Asset Sale.  Accordingly,
the  results of its  operations  prior to the Asset Sale are not  material.  The
reasons for and terms of the Asset Sale and the  discontinuance of the Company's
business were previously reported in the Company's Proxy Statement,  dated April
22, 1996 and Form 10 KSB for the fiscal year ended June 30, 1996.

On  December  31,  1998,  the  Company  had  approximately  $1,000  in cash  and
approximately  $270,000 in U.S.  Government  Treasury Bills. The Company expects
that it will earn approximately  $12,000 from interest during the current fiscal
year ending June 30, 1999.

Corporate and  administrative  expenses for the current fiscal year are expected
to be approximately $105,000 including $66,000 in fees and expense reimbursement
to the directors,  $10,000 for accounting fees for audit and tax returns, $3,000
for legal fees, $10,000 for liability insurance,  $7,800 for stock transfer fees
and printing expense, and approximately $4,000 for miscellaneous expenses. Funds
to pay the  expenses  are expected to be derived  from  interest  income  earned
during the year and from the Company's cash on hand.

Since the Asset Sale of June 1996, the Company's operations have been limited to
the conduct of administrative  activities such as paying indebtedness  remaining
after the Asset Sale,  acquiring  outstanding notes,  settling a claim for prior
services,  preparing and filing  federal and state tax returns and quarterly SEC
filings,  undertaking and completing an exchange offer for preferred  shares and
other general corporate  activities.  Also, the Company has been identifying and
conducting  discussions with respect to a possible business combination with one
or more entities  interested in acquiring or being acquired by the Company.  The
Company is free to  investigate  businesses  of  essentially  any kind or nature
including  but not  limited to,  finance,  technology,  manufacturing,  service,
research   and   development,   healthcare,    communications,    insurance   or
transportation. While the Company has not chosen any particular area of business
in which it may propose to engage and has conducted  only limited market studies
with respect to any business, property or industry, the directors of the Company
have  considered  the  strengths and  weaknesses of the Company and  established
certain initial criteria for its search.  The Company will first seek a business
combination  with a company  having a  business  or line of  products  with good
prospects for future profits and growth. In view of the Company's small size and
book  value,  the  appropriate  candidate  is  expected  to  be an  emerging  or
developing company.  Other priority candidates may be those desiring to become a
public  company and those which have an interest in acquiring the company's cash
and net operating loss carryforwards.

A number of companies have been identified which in the judgment of the Board of
Directors meet the criteria set forth above and discussions  have been held with
several of them. There is no assurance of the availability, viability or success
of any  acquisition  or the results of  operations  of the Company in connection
with any  acquisition or business  venture.  Even if a suitable  candidate for a
business combination is found and negotiations are successfully completed, there
is no assurance of successful operations after the combination has been effected
or that  existing  stockholders  of the  Company  will  not  suffer  substantial
dilution of their equity position,  either upon the business  combination itself
or upon the completion of any additional financing which may be necessary.

                                       -8-
<PAGE>
On December 31, 1998,  the Company held 12,655 shares of Parlux Stock and it had
approximately  $1,000 in cash in banks and $270,000 in U.S.  Government Treasury
Bills  maturing in  February  1999.  The Parlux  Stock may be sold to the public
pursuant to a currently  effective  Registration  Statement under the Securities
Act of 1933,  covering  those  shares.  Management  believes  that the Company's
reserves  in cash and  treasury  bills  are  adequate  to  support  its  current
activities for the year ended June 30, 1999.  However,  if management decides to
merge with or acquire a business, this may require additional capital. There can
be no assurance  that the Company will be able to raise such capital when and if
it is needed.

In connection with the Asset Sale on June 28, 1996, all employees of the Company
were  terminated  and the Company has no employees.  The Company's two executive
officers  provide  certain  services to the  Company on a part-time  contingency
basis. There are no present plans to hire any employees.

FORWARD-LOOKING STATEMENTS

Certain  information   contained  in  this  Quarterly  Report  on  Form  10-QSB,
including,  without  limitation,  information  appearing  under  Part 1, Item 2,
"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations",  are forward-looking  statements (within the meaning of Section 27A
of the Securities Act of 1933 and Section 21E of the Securities  Exchange Act of
1934).  Factors set forth in the Company's  Annual Report on Form 10-KSB for the
fiscal  year  ended  June  30,  1998,  under  Item  1,  "Business"  and  Item  6
"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations"  together  with other  factors that appear with the  forward-looking
statements, or in the Company's other Securities and Exchange Commission filings
could affect the Company's  actual results and could cause the Company's  actual
results  to  differ  materially  from  those  expressed  in any  forward-looking
statements  made by, or on behalf of, the  Company in this  Quarterly  Report on
Form 10-QSB.

                                       -9-
<PAGE>
                                   SIGNATURES


        In accordance with Section 13 or 15(d) of the Securities Exchange Act of
1934,  the  Registrant  caused  this  Report to be  signed on its  behalf by the
undersigned, thereunto duly authorized.

                                            FBR CAPITAL CORPORATION
                                                 (Registrant)


Dated: February 16, 1999               By: /s/ Charles D. Snead, Jr.
                                           -------------------------------------
                                                Charles D. Snead, Jr., President




                                      -10-