U.S. SECURITIES 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

   ( )      TRANSACTION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
            SECURITIES EXCHANGE ACT OF 1934

         For Quarter Ended:                          Commission File Number:
           June 30, 2002                                   0-7722


                           NEW CENTURY COMPANIES, INC.
--------------------------------------------------------------------------------
             (Exact name of Registrant as specified in its charter)


          DELAWARE                                    061034587
-------------------------------            ------------------------------------
(State or other jurisdiction of            (IRS Employer Identification Number)
Incorporation or organization)


                           9835 Santa Fe Springs Road
                           Santa Fe Springs, CA 90670
--------------------------------------------------------------------------------
       (Address of Principal Executive Offices)             (Zip Code)


                                 (562) 906-8455
--------------------------------------------------------------------------------
              (Registrant's telephone number, including area code)


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required to file such  reports) and (2) has been subject to filing  requirements
for the past 90 days.
                                   Yes X   No
                                      ---    ----

The number of shares of Common Stock, par value $ .10 per share,  outstanding as
of June 30, 2002 is 4,962,808.

Transitional Small Business Disclosure Format (check one): Yes      No    X
                                                               ---       ---


<PAGE>


ITEM 1.  FINANCIAL STATEMENTS

                                                     NEW CENTURY COMPANIES, INC.
                                                                  AND SUBSIDIARY
                                                                        CONTENTS
                                                       JUNE 30, 2002 (UNAUDITED)
--------------------------------------------------------------------------------


                                                                      Page
CONSOLIDATED FINANCIAL STATEMENTS

     Consolidated Balance Sheet                                       3 - 4

     Consolidated Statements of Operations                              5

     Consolidated Statements of Cash Flows                            6 - 7

     Notes to Consolidated Financial Statements                       8 - 14






























                                        2
<PAGE>


                                                     NEW CENTURY COMPANIES, INC.
                                                                  AND SUBSIDIARY
                                                      CONSOLIDATED BALANCE SHEET
                                                       JUNE 30, 2002 (UNAUDITED)
--------------------------------------------------------------------------------


                                     ASSETS


                  Current Assets
     Cash                                                       $       331,677
     Contracts receivable                                               464,911
     Costs in excess of billings on contracts in progress               276,039
     Inventory                                                        1,590,501
     Prepaid expenses and other current assets                           44,466
                                                                ---------------

            Total current assets                                      2,707,594

PROPERTY AND EQUIPMENT, net                                           1,034,295
DEPOSITS                                                                259,177
                                                                ---------------
                   TOTAL ASSETS                                 $     4,001,066
                                                                ===============
























   The accompanying notes are an integral part of these financial statements.




                                        3
<PAGE>


                                                     NEW CENTURY COMPANIES, INC.
                                                                  AND SUBSIDIARY
                                                      CONSOLIDATED BALANCE SHEET
                                                       JUNE 30, 2002 (UNAUDITED)
--------------------------------------------------------------------------------


                      LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES
     Book overdraft                                             $        76,344
     Notes payable                                                      425,846
     Current portion of capital lease obligations                        45,512
     Accounts payable                                                 1,232,698
     Accrued expenses                                                    88,859
     Billings in excess of costs and estimated earnings
        on contracts in progress                                      1,512,422
                                                                ---------------
              Total current liabilities                               3,381,681

CAPITAL LEASE OBLIGATIONS, net of current portion                        27,888
                                                                ---------------

                Total liabilities                                     3,409,569
                                                                ---------------

COMMITMENTS AND CONTINGENCIES

SHAREHOLDERS' EQUITY
     Cumulative, convertible, Series B Preferred Stock,
         $1 par value, 15,000,000 shares authorized
         38,900 shares issued and outstanding                            38,900
     5%, cumulative, convertible, Series C Preferred
         Stock, $1 par value, 75,000 shares authorized
         46,200 shares issued and outstanding (liquidation
         preference of $1,155,000)                                       46,200
     Common stock, $0.10 par value
         6,000,000 shares authorized
         4,970,527 shares issued and outstanding                        497,053
     Additional paid-in capital                                       2,801,025
     Treasury stock, at cost, 164,414 shares                           (164,414)
     Subscription receivable                                         (1,087,500)
     Loans to shareholders                                             (433,345)
     Accumulated deficit                                             (1,106,422)
                                                                ---------------

                Total shareholders' equity                              591,497
                                                                ---------------

                   TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY   $     4,001,066
                                                                ===============


   The accompanying notes are an integral part of these financial statements.

                                        4
<PAGE>
<TABLE>
<CAPTION>

                                                     NEW CENTURY COMPANIES, INC.
                                                                  AND SUBSIDIARY
                                           CONSOLIDATED STATEMENTS OF OPERATIONS
                                FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2002
--------------------------------------------------------------------------------

                                                  For the Three Months Ended         For the Six Months Ended
                                                        June 30,                           June 30,
                                               -------------------------------    -------------------------------
                                                     2002             2001              2002             2001
                                               -------------    --------------    -------------    --------------
                                                 (unaudited)      (unaudited)       (unaudited)      (unaudited)
<S>                                            <C>              <C>               <C>              <C>
NET SALES                                      $   2,227,233    $    2,063,459    $   3,571,043    $    3,237,396
CONTRACT COSTS                                     1,824,997         1,659,349        2,874,637         2,794,384
                                               -------------    --------------    -------------    --------------
GROSS PROFIT                                         402,236           404,110          696,406           443,012

Operating expenses                                   465,331           351,373          864,958           482,077
                                               -------------    --------------    -------------    --------------

INCOME (LOSS) FROM OPERATIONS                        (63,095)           52,737         (168,552)          (39,065)
                                               -------------    --------------    -------------    --------------
OTHER INCOME (EXPENSE)
   Interest income                                    10,834                 -           10,834                 -
   Interest expense                                  (94,301)          (17,626)        (162,008)          (27,659)
                                               -------------    --------------    -------------    --------------

     Total other income (expense)                    (83,667)          (17,626)        (151,174)          (27,659)
                                               -------------    --------------    -------------    --------------

INCOME (LOSS) BEFORE PROVISION
   FOR INCOME TAXES                                 (146,762)           35,111         (319,726)          (66,724)
PROVISION FOR INCOME TAXES                                 -            62,559                -            62,259
                                               -------------    --------------    -------------    --------------

NET LOSS                                            (146,762)          (27,148)        (319,726)         (129,283)

PREFERRED STOCK DIVIDENDS                                  -                 -           56,125                 -
DEEMED DIVIDEND ON PREFERRED STOCK                   308,029                 -          308,029                 -
                                               -------------    --------------    -------------    --------------
NET LOSS ATTRIBUTABLE TO COMMON SHAREHOLDERS   $    (454,791)   $      (27,148)   $     683,880)   $     (129,283)
                                               =============    ==============    =============    ==============
BASIC AND DILUTED LOSS ATTRIBUTABLE
   TO COMMON SHAREHOLDERS PER COMMON SHARE     $      (0.09)    $       (0.01)    $      (0.12)    $        (0.03)
                                               =============    ==============    =============    ==============

WEIGHTED-AVERAGE NUMBER OF COMMON SHARES
   USED TO COMPUTE BASIC AND DILUTED LOSS
   ATTRIBUTABLE TO COMMON SHAREHOLDERS
   PER SHARE                                       5,025,684         2,707,537        5,738,495         4,468,693
                                               =============    ==============    =============    ==============
</TABLE>

   The accompanying notes are an integral part of these financial statements.

                                      5
<PAGE>
<TABLE>
<CAPTION>
                                                     NEW CENTURY COMPANIES, INC.
                                                                  AND SUBSIDIARY
                                           CONSOLIDATED STATEMENTS OF CASH FLOWS
                                          FOR THE SIX MONTHS ENDED JUNE 30, 2002
--------------------------------------------------------------------------------

                                                                      2002          2001
                                                                ------------    ------------
                                                                 (unaudited)     (unaudited)
<S>                                                             <C>             <C>
CASH FLOWS FROM OPERATING ACTIVITIES
   Net loss                                                     $   (319,726)   $   (129,283)
   Adjustments to reconcile net loss to net cash
     used in operating activities
       Depreciation and amortization of property and equipment       115,693         150,456
       Amortization of consulting fees                               155,031               -
       Amortization of discount on notes payable                      53,000               -
       Interest income                                               (17,916)              -
       (Increase) decrease in
         Contracts receivable                                       (158,735)       (122,800)
         Cost in excess of billings on contracts in progress        (169,485)         56,854
         Inventory                                                  (397,297)        (62,970)
         Prepaid expenses and other current assets                    71,383          23,524
         Deferred tax assets                                               -         (28,256)
       Increase (decrease) in
         Accounts payable                                            135,224         301,007
         Accrued expenses                                           (226,526)        193,973
         Billings in excess of costs and estimated earnings
           on contracts in progress                                  590,838        (440,475)
                                                                ------------    ------------
Net cash used in operating activities                               (168,516)        (57,970)
                                                                ------------    ------------
CASH FLOWS FROM INVESTING ACTIVITIES
   Loans to officers                                                       -         (70,221)
   Purchase of property and equipment                               (449,123)         (2,219)
                                                                ------------    ------------
Net cash used in investing activities                               (449,123)        (72,440)
                                                                ------------    ------------
CASH FLOWS FROM FINANCING ACTIVITIES
   Book overdraft                                                    (11,735)         26,526
   Principal payments on notes payable                               (18,167)        (75,666)
   Principal payments on capital lease obligations                   (21,151)        (23,165)
   Proceeds from issuance of preferred stock                         956,605               -
                                                                ------------    ------------
Net cash provided by (used in) financing activities                  905,552         (72,305)
                                                                ------------    ------------

Net increase (decrease) in cash                                      287,913        (202,715)

CASH, BEGINNING OF PERIOD                                             43,764         224,218
                                                                ------------    ------------

CASH, END OF PERIOD                                             $    331,677    $     21,503
                                                                ============    ============
</TABLE>
   The accompanying notes are an integral part of these financial statements.

                                      6
<PAGE>


<TABLE>
<CAPTION>
                                                     NEW CENTURY COMPANIES, INC.
                                                                  AND SUBSIDIARY
                                           CONSOLIDATED STATEMENTS OF CASH FLOWS
                                          FOR THE SIX MONTHS ENDED JUNE 30, 2002
--------------------------------------------------------------------------------

                                                                     2002          2001
                                                                ------------    ------------
                                                                 (unaudited)     (unaudited)
<S>                                                             <C>              <C>
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION

   INTEREST PAID                                                $      86,513   $      27,959
                                                                =============   =============

   INCOME TAXES PAID                                            $       1,630   $           -
                                                                =============   =============
</TABLE>


SUPPLEMENTAL SCHEDULE OF NON-CASH FINANCING ACTIVITIES
During  the six  months  ended  June 30,  2002,  the  Company  entered  into the
following non-cash transactions:

o    converted  12,000  shares of Preferred  Stock into 20,000  shares of common
     stock, reflecting an increase of $10,000 to additional paid-in capital

o    issued  2,200 shares of Series C 5% Preferred  Stock in  connection  with a
     private placement

o    acquired $6,449 of property and equipment under capital lease obligations

















   The accompanying notes are an integral part of these financial statements.


                                        7
<PAGE>

                                                     NEW CENTURY COMPANIES, INC.
                                                                  AND SUBSIDIARY
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                                       JUNE 30, 2002 (UNAUDITED)
--------------------------------------------------------------------------------

NOTE 1 - NATURE OF BUSINESS

     General
     -------
     New Century  Companies,  Inc., a California  corporation,  was incorporated
     March 1996 and is located in Southern  California.  The Company (as defined
     in  Note  3)  provides   after-market   services,   including   rebuilding,
     retrofitting,   and  remanufacturing  of  metal  cutting  machinery.   Once
     completed,  a  remanufactured  machine is "like new" with  state-of-the-art
     computers,  and the cost to the Company's customers is approximately 40% to
     50% of that of a new machine.

     The Company  currently  sells its  services  by direct  sales and through a
     network of machinery  dealers across the United  States.  Its customers are
     generally  medium-  to  large-sized   manufacturing  companies  in  various
     industries where metal cutting is an integral part of their businesses. The
     Company grants credit to its customers who are predominately located in the
     western United States.

     Stock Split
     -----------
     On November 26, 2001,  the Company  authorized a one-for-10  reverse  stock
     split.  All share and per share data have been  retroactively  restated  to
     reflect the split.

     Merger with InternetMercado.com, Inc.
     -------------------------------------
     On May  25,  2001,  the  Company  entered  into  a  merger  agreement  (the
     "Agreement") in which the Company was merged with InternetMercado.com, Inc.
     ("InternetMercado").  In accordance  with the terms of the  Agreement,  the
     following conversions occurred:

     o    Each issued and outstanding  share of common stock of the new entity's
          newly formed,  wholly owned subsidiary was converted into one share of
          the Company's common stock.

     o    Each share of the Company's  common stock was converted into shares of
          InternetMercado's  common  stock,  par  value  $0.10  per  share  (the
          "InternetMercado  Shares") at the rate of 83.33  InternetMercado Share
          for each of the Company's shares  amounting to an aggregate  1,500,000
          InternetMercado Shares.

     The  transaction has been accounted for as a reverse  acquisition,  whereby
     the Company is the  accounting  acquirer,  and the equity  section has been
     restated to reflect the Company's current capital structure.

     Name Change
     -----------
     In June 2001, the Company's name was changed from InternetMercado.com, Inc.
     to New Century Companies, Inc.

                                        8
<PAGE>
                                                     NEW CENTURY COMPANIES, INC.
                                                                  AND SUBSIDIARY
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                                       JUNE 30, 2002 (UNAUDITED)
--------------------------------------------------------------------------------

NOTE 2 - GOING CONCERN

     The  financial  information  included  in  these  financial  statements  is
     unaudited, but, in the opinion of management, reflects all normal recurring
     adjustments  necessary  for a fair  presentation  of the  results  for  the
     interim  periods.  The interim results of operations and cash flows are not
     necessarily indicative of those results and cash flows for the entire year.
     These financial statements should be read in conjunction with the financial
     statements  and notes to the financial  statements  contained in the Annual
     Report on Form 10-KSB for the year ended  December 31, 2001 of the Company.
     In addition,  the Company is in default in certain of its loans.  (See Note
     5.)


NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     Principles of Consolidation
     ---------------------------
     The consolidated  financial  statements include the accounts of New Century
     Companies,   Inc.   and  its   wholly   owned   subsidiary,   New   Century
     Remanufacturing (collectively, the "Company"). All significant intercompany
     accounts and transactions have been eliminated in consolidation.

     Interim Unaudited Financial Information
     ---------------------------------------
     The  unaudited   financial   information   furnished  herein  reflects  all
     adjustments,  consisting only of normal recurring adjustments, which in the
     opinion  of  management,  are  necessary  to  fairly  state  the  Company's
     financial  position,  the  results  of  operations,  and cash flows for the
     periods presented.  The results of operations for the six months ended June
     30, 2002 are not  necessarily  indicative  of results for the entire fiscal
     year ending December 31, 2002.

     The information with respect to the six months ended June 30, 2002 and 2001
     is unaudited.

     Revenue Recognition
     -------------------

     SERVICE REVENUE
     Service  revenues are billed and  recognized in the period the services are
     rendered.

     METHOD OF ACCOUNTING FOR LONG-TERM CONTRACTS
     The  Company  uses the  percentage-of-completion  method of  accounting  to
     account for long-term contracts and, therefore, take into account the cost,
     estimated  earnings,  and revenue to date on  fixed-fee  contracts  not yet
     completed. The  percentage-of-completion  method is used because management
     considers  total cost to be the best  available  measure of progress on the
     contracts.  Because of inherent uncertainties in estimating costs, it is at
     least  reasonably  possible that the estimates  used will change within the
     near term.

                                        9
<PAGE>

                                                     NEW CENTURY COMPANIES, INC.
                                                                  AND SUBSIDIARY
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                                       JUNE 30, 2002 (UNAUDITED)
--------------------------------------------------------------------------------

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

    Revenue Recognition (Continued)
    -------------------

     METHOD OF ACCOUNTING FOR LONG-TERM CONTRACTS (CONTINUED)
     The amount of revenue  recognized at the  statement  date is the portion of
     the  total  contract  price  that the cost  expended  to date  bears to the
     anticipated final cost, based on current estimates of cost to complete.  It
     is not  related to the  progress  billings  to  customers.  Contract  costs
     include all materials,  direct labor,  machinery,  subcontract  costs,  and
     allocations of indirect overhead.

     Because long-term  contracts extend over one or more years,  changes in job
     performance,  changes in job conditions, and revisions of estimates of cost
     and earnings  during the course of the work are reflected in the accounting
     period in which the facts that require the revision  become  known.  At the
     time a loss on a contract becomes known, the entire amount of the estimated
     ultimate loss is recognized in the financial statements.

     Contracts  that  are  substantially  complete  are  considered  closed  for
     financial  statement  purposes.  Revenue earned on contracts in progress in
     excess of  billings  (underbillings)  is  classified  as a  current  asset.
     Amounts billed in excess of revenue earned (overbillings) are classified as
     a current liability.

     Inventory
     ---------
     Inventory  is  comprised  primarily of work in process and is valued at the
     lower of cost  (first-in,  first-out  method)  or market.  Cost  components
     include material, direct labor, machinery, subcontracts, and allocations of
     indirect overhead.

     Income Taxes
     ------------
     The Company  provides  for income  taxes in  accordance  with  Statement of
     Financial  Accounting  Standards  ("SFAS") No. 109,  "Accounting for Income
     Taxes." Deferred income taxes are provided on a liability  method,  whereby
     deferred tax assets are recognized for  deductible  temporary  differences,
     and  deferred  tax  liabilities   are  recognized  for  taxable   temporary
     differences. Temporary differences are the differences between the reported
     amounts of assets and liabilities and their tax bases.  Deferred tax assets
     are reduced by a valuation allowance when, in the opinion of management, it
     is more likely than not that some portion of all of the deferred tax assets
     will not be realized.  Deferred tax assets and liabilities are adjusted for
     the effects of changes in tax laws and rates on the date of enactment.




                                       10
<PAGE>

                                                     NEW CENTURY COMPANIES, INC.
                                                                  AND SUBSIDIARY
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                                       JUNE 30, 2002 (UNAUDITED)
--------------------------------------------------------------------------------

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

     Income Taxes (Continued)
     ------------
     As of April 30, 2001, the Company's  federal filing status was changed from
     "S"  corporation  to "C"  corporation  status.  Under  its "S"  corporation
     status,  any  profits  or  losses  in the  Company  were  passed  on to its
     shareholders and were not taxed at the corporate  level.  Taxes recorded on
     the  accompanying  financial  statements are only those for the period from
     May 1, 2001 through June 30, 2002 and may not be  indicative  of future tax
     provisions.

     The pro forma  effects of taxes as if the  Company  had been taxed as a "C"
     corporation  during the six months  ended June 30,  2002 and 2001 would not
     have an  effect on pro forma  basic  and  diluted  loss per share as a full
     valuation allowance was made on the deferred tax benefit.

     Loss per Share
     --------------
     Loss per  share is  presented  according  to SFAS No.  128,  "Earnings  Per
     Share." Basic loss per share excludes  dilution and is computed by dividing
     net loss available to common shareholders by the weighted-average number of
     common shares  outstanding for the period.  Diluted loss per share reflects
     the potential dilution that could occur if securities or other contracts to
     issue common  stock were  exercised or  converted  into common  stock.  The
     components  of basic and  diluted  loss per share for the six months  ended
     June 30, 2002 and 2001 were as follows:
                                                      2002              2001
                                                    ----------      ----------
                                                   (unaudited)      (unaudited)
     Numerator
       Net loss                                     $ (683,880)     $ (129,283)
                                                    ==========      ==========

     Denominator
       Weighted-average number of common shares
            outstanding during the period            5,738,495       4,468,693
       Assumed exercised stock options and
            warrants outstanding                             *               -
       Assumed conversion of cumulative, convertible
            Series B and C Preferred Stock                   *               -
                                                    ----------      ----------

                COMMON STOCK AND COMMON STOCK
                 EQUIVALENTS USED FOR DILUTED
                 INCOME PER SHARE                    5,738,495       4,468,693
                                                    ==========      ==========

     *    The effect of  outstanding  stock options and  preferred  stock is not
          included as the result would be anti-dilutive.

                                       11
<PAGE>

                                                     NEW CENTURY COMPANIES, INC.
                                                                  AND SUBSIDIARY
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                                       JUNE 30, 2002 (UNAUDITED)
--------------------------------------------------------------------------------

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

     Reclassifications
     -----------------
     Certain amounts included in the prior period financial statements have been
     reclassified   to  conform  with  the  current  year   presentation.   Such
     reclassification did not have any effect on reported net loss.

     Estimates
     ---------
     The  preparation  of  financial  statements  requires  management  to  make
     estimates and  assumptions  that affect the reported  amounts of assets and
     liabilities and disclosure of contingent assets and liabilities at the date
     of the  financial  statements  and the  reported  amounts  of  revenue  and
     expenses  during the  reporting  period.  Actual  results could differ from
     those estimates.

     Recent Issued Accounting Pronouncement
     --------------------------------------
     In April 2002, the Financial  Accounting  Standards  Board ("FASB")  issued
     SFAS No. 145,  "Rescission of FASB Statements No. 4, 44, and 64,  Amendment
     of FASB Statement No. 13, and Technical Corrections." SFAS No. 145 updates,
     clarifies,   and  simplifies  existing  accounting   pronouncements.   This
     statement  rescinds  SFAS No. 4, which  required  all gains and losses from
     extinguishment of debt to be aggregated and, if material,  classified as an
     extraordinary  item,  net of related  income tax effect.  As a result,  the
     criteria in APB No. 30 will now be used to classify those gains and losses.
     SFAS No. 64 amended SFAS No. 4 and is no longer necessary as SFAS No. 4 has
     been  rescinded.  SFAS  No.  44  has  been  rescinded  as it  is no  longer
     necessary.  SFAS No. 145 amends SFAS No. 13 to require that  certain  lease
     modifications   that  have  economic  effects  similar  to   sale-leaseback
     transactions   be   accounted   for  in  the  same  manner  as   sale-lease
     transactions.  This statement also makes technical  corrections to existing
     pronouncements.  While those  corrections are not substantive in nature, in
     some instances,  they may change accounting practice.  The Company does not
     expect adoption of SFAS No. 145 to have a material  impact,  if any, on its
     financial position or results of operations.

     In June  2002,  the  FASB  issued  SFAS  No.  146 "  Accounting  for  Costs
     Associated  with exit or Disposal  Activities."  This  Statement  addresses
     financial  accounting  and  reporting  for  costs  associated  with exit or
     disposal  activities and nullifies  Emerging Issues Task Force (EITF) Issue
     No. 94-3, "Liability  Recognition for Certain Employee Termination Benefits
     and Other Costs to Exit an Activity  (including Certain Costs Incurred in a
     Restructuring)."  This  Statement  requires  that  a  liability  for a cost
     associated  with  an exit or  disposal  activity  be  recognized  when  the
     liability  is  incurred.  Under Issue 94-3 a liability  for an exit cost as
     defined,  was  recognized at the date of an entity's  commitment to an exit
     plan.  This  statement  will not have a  material  impact on the  Company's
     financial statements.


                                       12
<PAGE>

                                                     NEW CENTURY COMPANIES, INC.
                                                                  AND SUBSIDIARY
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                                       JUNE 30, 2002 (UNAUDITED)
--------------------------------------------------------------------------------

NOTE 4 - CONTRACTS IN PROGRESS

     Contracts in progress as of June 30, 2002 were as follows:

             Cumulative costs to date                         $      2,658,652
             Cumulative gross profit to date                         2,353,040
                                                              ----------------

             Cumulative revenue earned                               5,011,692
             Less progress billings to date                          6,248,075
                                                              ----------------

                 NET OVERBILLINGS                             $     (1,236,383)
                                                              ================


     The  following is included in the  accompanying  balance  sheet under these
     captions as of June 30, 2002:

             Costs and estimated earnings on contracts in
                 progress in excess of billings               $        276,039
             Billings in excess of costs and estimated
                 earnings on contracts in progress                   1,512,422
                                                              ----------------

                      NET OVERBILLINGS                        $     (1,236,383)
                                                              ================


NOTE 5 - NOTES PAYABLE

     As of June 30, 2002, notes payable from Citibank,  which are secured by all
     of the  Company's  assets  and  personal  guarantees  of the  shareholders,
     amounting  to $136,624  and the  unsecured  note  payable  with  detachable
     warrants  amounting to $250,000  were in default.  The Company is currently
     negotiating  their renewal.  There is not a guarantee that the Company will
     be able to benefit from any favorable renewal terms.


NOTE 6 - LOANS TO SHAREHOLDERS

     As of June 30, 2002,  the Company had loans to certain of its  shareholders
     for $433,345, which bear interest at 5% per annum. There is not a specified
     maturity date, and it is the Company's and  shareholders'  intention not to
     reduce the balance before  December 31, 2002. For the six months ended June
     30, 2002, total interest income from loans to shareholders was $10,834.




                                       13
<PAGE>

                                                     NEW CENTURY COMPANIES, INC.
                                                                  AND SUBSIDIARY
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                                       JUNE 30, 2002 (UNAUDITED)
--------------------------------------------------------------------------------

NOTE 7 - SHAREHOLDERS' EQUITY

     Series B Preferred Stock
     ------------------------
     The Company has 15,000,000  authorized  shares of  cumulative,  convertible
     Series B Preferred Stock. The preferred B shares have a cumulative dividend
     of  $1.25  per  share,  which  is  payable  on  a  semi-annual  basis,  are
     convertible  into 1.667 shares of the Company's  common  stock,  and do not
     have any voting rights.  As of June 30, 2002, 38,900 shares were issued and
     outstanding,  and accumulated  dividends  amounted to $56,125 for the three
     months  ended  June 30,  2002.  Cumulative  dividends  attributable  to the
     Company since May 25, 2001 were $449,248.  During the six months ended June
     30, 2002, 12,000 preferred shares were converted into 20,000 common shares.

     Series C Preferred Stock
     ------------------------
     In March 2002,  the Company  authorized  75,000  shares of 5%,  cumulative,
     convertible  Series C  Preferred  Stock.  The  preferred  C  shares  have a
     cumulative  dividend of $1.25 per share,  which is payable on a semi-annual
     basis on June and December of each year to holders of record on November 30
     and May 31, are  convertible  into 16.667  shares of the  Company's  common
     stock, and do not have any voting rights.  Upon liquidation of the Company,
     the Series C preferred shareholder are entitled to a liquidation preference
     of $25 per share,  which is superior to the claim of any other shareholder.
     The Series C preferred  shareholders are not entitled to any  distributions
     above their liquidation preference. As of June 30, 2002, there were not any
     shareholders of record entitled to dividends. .

     As of June 30, 2002, the Company completed the following transactions:

     o    Issued 44,000 shares valued at $25 per share for $1,100,000 in cash

     o    Issued 2,200 shares in exchange for services rendered by the placement
          agent in connection with a private placement

     As the Series C Preferred  Stock was issued with a conversion  feature at a
     discount to the trading  value of the Company's  common stock,  the Company
     has recorded a deemed  dividend to its preferred  shareholders of $308,029.
     The  deemed   dividend  is  reflected  as  an  increase  in  the  net  loss
     attributable  to  common  shareholders  on  the  accompanying  consolidated
     statements of operations.


NOTE 8 - RELATED PARTY TRANSACTIONS

     The Company received a $1,000,000 subscription receivable from employees in
     exchange for  4,000,000  shares of the Company's  common  stock.  The notes
     receivable  were extended  during May 2002 for one year at an interest rate
     of 10% per annum.


                                       14
<PAGE>


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

OVERVIEW

     On May 25, 2001, the  Registrant  acquired all of the  outstanding  capital
stock of New Century  Remanufacturing,  Inc. in exchange for 1,500,000 shares of
the Registrant's common stock. For accounting purposes, this acquisition will be
treated as a  recapitalization  of New Century  Remanufacturing,  Inc.  with New
Century  Remanufacturing,  Inc.  as  the  acquirer.  Therefore  following  is  a
discussion of the results of operations of New Century Remanufacturing, Inc.

RESULTS OF OPERATIONS

Three-month  period Ended June 30, 2002 compared to the Three-month period ended
--------------------------------------------------------------------------------
June 30, 2001
-------------

         REVENUE AND GROSS PROFIT MARGIN

         The Company generated revenues of $2,227,233 for the three-month period
ended June 30, 2002,  which was a $163,774 or 8% increase from $2,063,459 in the
corresponding  period  in 2001.  The  increase  is a result  of an  increase  in
customer's orders.

         There was a slight decrease of 2% in Gross profit  for the  three-month
period  ended June 30,  2002.  Gross  Profit  was  $402,236  or 18% of  revenue,
compared to $404,110 or 20%, in the corresponding period in 2001.

         Interest  expense  for the  three-month  period  ended  June 31,  2002,
increased  to $94,301,  compared to $17,626 for the period  ended June 30, 2001.
This  increase is the result of  amortization  of the  discount  relating to the
warrants on a short-term loan obtained in December 2001.

         OPERATING EXPENSES

         Operating  expenses increased by $113,958 or 32%, from $351,373 for the
three month period ended June 30, 2001 to $465,331 for the corresponding  period
in 2002. This increase is the result of costs associated to our move to a larger
facility in February of 2002.

         NET INCOME/LOSS AND EARNINGS PER SHARE

         Net loss was  $146,762 for the  three-month  period ended June 30, 2002
compared  to a net loss of $27,148  for the  corresponding  period in 2001.  The
increase in net loss is attributable  to costs  associated with the expansion of
our operations and the cost incurred by moving to a larger facility.

         Loss per share for the three-month period ended June 30, 2002 increased
by $0.08, from $0.01 for the three month period ended June 30, 2001 to $0.09 for
the corresponding period in 2002. The increase was attributable to a discount on
deemed  dividends  of $308,029  related to private  placement of our Series C 5%
Convertible Preferred Shares.

                                       15
<PAGE>

Six-month period Ended June 30, 2002 compared to the Six-month period ended June
--------------------------------------------------------------------------------
30, 2001
--------

         REVENUE AND GROSS PROFIT MARGIN

         For the  six-month  period ended June 30,  2002,  total  revenues  were
$3,571,043, which was an increase of $333,647 or 10% from revenues of $3,237,396
in the  corresponding  period in 2001. The increase is the result of an increase
in customer's orders.

         For the six-month period ended June 30, 2002, gross profit was $696,406
or 19% of revenue,  compared to $443,012 in the corresponding period in 2001, an
increase by  $253,394.  The increase is the result of improved  productivity  in
manufacturing.

         Interest  expense  for  the  six-month  period  ended  June  31,  2002,
increased  by  $134,349.  This  increase  is the result of  amortization  of the
discount  relating to the  warrants on a  short-term  loan  obtained in December
2001.

         OPERATING EXPENSES

         For  the  six-month  period  ended  June  30, 2002  operating  expenses
increased by $382,881 or 79%.  This  increase is related to our move to a larger
facility on February 2002.

         NET INCOME/LOSS AND EARNING PER SHARE

         For the  six-month  period  ended June 30,  2002,  we had a net loss of
$319,726  compared to a net loss of  $129,283  for the  corresponding  period in
2001.  The increase in net loss is  attributable  to costs  associated  with the
expansion  of our  operations  and the  cost  incurred  by  moving  to a  larger
facility.

         For the six-month  period ended June 30, 2002,  loss per share increase
by $0.09 from $0.03 for the  six-month  period  ended June 30, 2001 to $0.12 for
the corresponding period in 2002. The increase in loss per share is attributable
to a discount on deemed  dividends of $308,029  related to private  placement of
our Series C 5% Convertible Preferred Shares.

LIQUIDITY AND CAPITAL RESOURCES

         Our primary liquidity needs are to fund capital  expenditures.  We have
financed our working  capital  requirements  through a combination of internally
generated cash, short-term loans and private placements.


         Cash and cash  equivalents  were  $331,677  as of June 30,  2002.  This
represents  an  increase  of  $310,174  from June 30,  2001.  The  increase  was
primarily due to proceeds
from financing activities.


                                       16
<PAGE>

         We  received  $905,552  from the sale of  44,000  shares of Series C 5%
Convertible Preferred Shares in a private placement. These proceeds were used to
purchase property and equipment and for working capital.

         We  intend  to  pursue  external  financing  sources  to meet  the cash
requirement  of ongoing  operations.  Management  is  currently  seeking to rise
additional  funds in the  form of a equity  or debt  securities  offering,  or a
combination  thereof.  However,  there is can be no guarantee that we will raise
sufficient  capital to execute  our  business  plan.  To the extent  that we are
unable to raise sufficient  capital,  our business plan will require substantial
modified and our operations may be curtailed. These conditions raise substantial
doubt about our ability to continue as a going concern.  Continuation as a going
concern  is  dependent  upon  our  ability  to  ultimately   attain   profitable
operations,  generate  sufficient  cash  flow to meet  obligations,  and  obtain
additional financing as may be required.


RECENT ACCOUNTING  PRONOUNCEMENTS

         In  April  2002, the  FASB issued  SFAS No. 145,   RESCISSION  OF  FASB
STATEMENTS  NO. 4, 44 AND 64,  AMENDMENT OF FASB STATEMENT NO. 13, AND TECHNICAL
CORRECTIONS. SFAS No. 145 updates, clarifies, and simplifies existing accounting
pronouncements. This statement rescinds SFAS No. 4, which required all gains and
losses from extinguishments of debt to be aggregated and if material, classified
as an  extraordinary  item, net of related income tax effect.  As a result,  the
criteria in APB No. 30 will now be used to classify those gains and losses. SFAS
No.  64  amended  SFAS No. 4 and is no longer  necessary  as SFAS No. 4 has been
rescinded. SFAS No. 44 has been rescinded as it is no longer necessary. SFAS No.
145 amends SFAS No. 13 to require that  certain  lease  modifications  that have
economic effects similar to sale-leaseback  transactions be accounted for in the
same manner as sale-lease  transactions.  This  statement  also makes  technical
corrections  to  existing  pronouncements.   While  those  corrections  are  not
substantive in nature, in some instances,  they may change accounting  practice.
The Company does not expect adoption of SFAS No. 145 to have a material  impact,
if any, on its financial position or results of operations.


         In June  2002,  the FASB  issued  SFAS No. 146 "  Accounting  for Costs
Associated with exit or Disposal Activities." This Statement addresses financial
accounting and reporting for costs  associated with exit or disposal  activities
and  nullifies  Emerging  Issues Task Force (EITF)  Issue No.  94-3,  "Liability
Recognition for Certain Employee Termination Benefits and Other Costs to Exit an
Activity (including Certain Costs Incurred in a Restructuring)."  This Statement
requires  that a  liability  for a cost  associated  with an  exit  or  disposal
activity  be  recognized  when the  liability  is  incurred.  Under Issue 94-3 a
liability for an exit cost as defined, was recognized at the date of an entity's
commitment to an exit plan.  This statement  will not have a material  impact on
the Company's financial statements.





                                       17
<PAGE>

CRITICAL ACCOUNTING POLICIES

         Our discussion and analysis of our financial  conditions and results of
operations are based upon our consolidated financial statements, which have been
prepared in accordance  with  generally  accepted  accounting  principles in the
United States.  The preparation of financial  statements  require  management to
make  estimates  and  judgments  that affect the reported  amounts of assets and
liabilities,  revenues and expenses and disclosures on the date of the financial
statements. On an on-going basis, we evaluate our estimates,  including, but not
limited  to,  those  related  to  revenue  recognition.   We  use  authoritative
pronouncements,  historical  experience  and other  assumptions as the basis for
making judgements.  Actual results could differ from those estimates. We believe
that the following  critical  accounting  policies  affect our more  significant
judgments  and  estimates  in  the  preparation  of our  consolidated  financial
statements.

         Revenue Recognition
         SERVICE REVENUE
         Service  revenues are billed and  recognized in the period the services
         are rendered.

         METHOD OF ACCOUNTING FOR LONG-TERM CONTRACTS
         The Company uses the  percentage-of-completion  method of accounting to
         account for long-term contracts and,  therefore,  take into account the
         cost,  estimated  earnings,  and revenue to date on fixed-fee contracts
         not yet completed. The percentage-of-completion  method is used because
         management  considers  total cost to be the best  available  measure of
         progress  on  the  contracts.  Because  of  inherent  uncertainties  in
         estimating costs, it is at least reasonably possible that the estimates
         used will change within the near term.

         The amount of revenue  recognized at the statement  date is the portion
         of the total contract price that the cost expended to date bears to the
         anticipated final cost, based on current estimates of cost to complete.
         It is not related to the progress billings to customers. Contract costs
         include all materials, direct labor, machinery,  subcontract costs, and
         allocations of indirect overhead.

         Because long-term  contracts extend over one or more years,  changes in
         job performance,  changes in job conditions, and revisions of estimates
         of cost and earnings during the course of the work are reflected in the
         accounting  period in which the facts that require the revision  become
         known.  At the time a loss on a  contract  becomes  known,  the  entire
         amount of the  estimated  ultimate  loss is recognized in the financial
         statements.

         Contracts that are  substantially  complete are  considered  closed for
         financial statement  purposes.  Revenue earned on contracts in progress
         in excess of billings (underbillings) is classified as a current asset.
         Amounts  billed  in  excess  of  revenue  earned   (overbillings)   are
         classified as a current liability.

INFLATION AND CHANGING PRICES

         The Company  does not foresee any adverse  effects on its earnings as a
result of inflation or changing prices.

                                       18
<PAGE>


                           PART II. OTHER INFORMATION

Item 1.  Legal Proceedings

         None.

Item 2.  Changes in Securities and Use of Proceeds.

         In  June  2002  the  Company  issued  44,000  shares  of  Series  C  5%
Convertible  Preferred  Stock to certain  accredited  investors for an aggregate
amount of $1,100,000.  The shares were issued in a private placement pursuant to
an exemption  provided by Section  4(2).  The net proceeds of $905,552 were used
for working capital.

         In connection with the closing of the private  placement of Series C 5%
convertible  Preferred  Stock,  the Company  issued  2,200 shares of Series C 5%
convertible  Preferred  Stock to West America  Securities  Corp.  as payment for
their services as Placement Agent.

Item 3.  Defaults Upon Senior Securities

         None.

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

         None.

Item 5.  Other Information

         None.

Item 6.  Exhibits and Reports on Form 8-K

         (a)  Exhibits:

              99.1    Sarbanes Oxley Certification

         (b) Reports on Form 8-K:

              None.






                                       19
<PAGE>




                                   SIGNATURES

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



Dated: August 14, 2002

                                      NEW CENTURY COMPANIES, INC.




                                      By:   /s/ David Duquette
                                            --------------------------------
                                      Name:   David Duquette
                                      Title:  Chairman, President and Director









                                       20