U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                   FORM 10-KSB

 ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

                     For the fiscal year ended JULY 31, 2001

                         Commission file number 0-29671

                               SGD HOLDINGS, LTD.
                 (Name of small business issuer in its charter)

               DELAWARE                                  13-3986493
      (State or other jurisdiction of       (I.R.S. Employer Identification No.)
        incorporation or organization)

                     111 RHODES STREET, CONROE, TEXAS    77301
               Address of principal executive offices) (Zip Code)

                    Issuer's telephone number (936) 756-6888

                    Securities registered pursuant to Section
                               12(g) of the Act:

                         COMMON STOCK, $.0001 PAR VALUE
                                (Title of Class)

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 [X] No [ ] .

Check if delinquent filers in response to Item 405 of Regulation S-B is not
contained in this form, and no disclosure will be contained, to the best of
registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-KSB or any amendment to
this Form 10-KSB. [ ]

State issuer's revenues for its most recent fiscal year - $12,249,684.

As of September 30, 2001, the registrant had outstanding 97,099,408 shares of
its Common Stock, par value $.0001, its only class of voting securities. The
aggregate market value of the shares of Common Stock of the registrant held by
non-affiliates on September 30, 2001, was approximately $5,700,000 based on its
closing price on the OTC: Bulletin Board on that date. (See Item 5).

                       DOCUMENTS INCORPORATED BY REFERENCE

No documents are incorporated by reference into this Report except those
Exhibits so incorporated as set forth in the Exhibit index.

Transitional Small Business Disclosure Format (Check one):  Yes [  ]; No [ X ].



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<PAGE>



ITEM 1.  DESCRIPTION OF BUSINESS

BUSINESS DEVELOPMENT

On April 20, 2000, pursuant to an agreement and plan of reorganization dated
April 11, 2000, SGD Holdings, Ltd. ("SGD" or the "Company") acquired 100% of the
issued and outstanding common stock of Benton Ventures, Inc. ("Benton"), a
Delaware corporation, in exchange for 1,200,000 newly issued common shares of
SGD. On April 25, 2000, the Board of Directors of SGD elected to merge Benton
into SGD pursuant to Section 253 of Delaware's General Corporate Laws. As a
result of the merger, SGD was the surviving company and assumed the reporting
responsibilities under successor issuer status as more fully detailed in Section
12(g)(3) of The Securities Exchange Act of 1934. On January 24, 2001 the Company
changed its name from Goldonline International, Inc. to SGD Holdings, Ltd.

SGD, formerly Transun International Airways, Inc., was incorporated May 22, 1996
in Delaware and until June 1999 was a development stage company with plans to
establish itself as an air transport company providing non-scheduled air service
(charter flights) for tour operators, charter brokers, cruise line casinos,
theme parks and theme attractions.

On June 10, 1999, SGD acquired all of the issued and outstanding common stock of
Con-Tex Silver Imports, Inc. ("Silver"), incorporated September 12, 1994 in
Texas and Jewelry Solutions & Commerce, Inc. ("Jewelry"), incorporated February
3, 1999 in Delaware. For accounting purposes, the acquisitions have been treated
as the acquisition of Silver and Jewelry by SGD with Silver as the acquirer
(reverse acquisition). The historical financial statements prior to June 10,
1999 are those of Silver. On January 17, 2001, Gold Online.com, Inc. changed its
name to Jewelry Solutions & Commerce, Inc.

          ACQUISITION OF HMS JEWELRY CO., LTD AND HMS OPERATING COMPANY

Effective October 1, 2000, the Company acquired, pursuant to an Agreement and
Plan of Merger the operations and business of HMS Jewelry Company, Inc. ("HMS"),
in exchange for $4,500,000 in cash and convertible promissory notes in the
amount of $2,500,000. The purchase also included $47,500 in legal and
professional costs. The transaction resulted in the merger of the business and
operations of HMS Jewelry Co., Ltd., a Texas limited partnership and HMS
Operating Company, a Texas corporation into a newly formed subsidiary of the
Company, HMS Jewelry Company, Inc. HMS is a national jewelry wholesaler,
specializing in 18K, 14K and 10K gold and platinum jewelry, with headquarters in
Dallas, Texas. HMS markets its products to a network of over 30,000 retail
jewelers, through a catalog and telephone ordering system and through its B2B
online catalog http://www.HMSgold.com. The notes bear interest at eight percent
(8%) per annum, require monthly payment of interest and are convertible into the
Company's common stock at $1.25 per share, as adjusted for any stock splits or
combinations. One note in the amount of $1.25 million is due October 15, 2001,
and the other note in the amount of $1.25 million is due October 15, 2002.



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<PAGE>


For the year ended July 31, 2000, unaudited pro forma combined sales would have
been $16,200,000, net earnings would have been $492,000 and net earnings per
share would have been $0.006.

Prior to closing the HMS transaction, the Company sold 1.1 million shares of its
common stock for net proceeds of $1,567,500 and utilized these funds plus
existing cash reserves to make the initial cash payment.


BUSINESS OF ISSUER

SGD is now a holding company principally engaged in acquiring and developing
jewelry related businesses. HMS is a wholesale jewelry distributor with
headquarters in Dallas, Texas. HMS primarily sells gold products to a network of
over 30,000 retail jewelers, through a catalog and telephone ordering system.
Silver is involved in both the wholesale and retail jewelry business,
principally silver, with retail locations in the Houston area. The wholesale
operation of Silver consists of sales directly from its headquarters in Conroe,
Texas, sales from three Dallas locations and sales from jewelry shows at
locations throughout the south central United States. Jewelry established an
Internet jewelry presence in the late fall of 1999, when Jewelry began selling
through an e-commerce site, located at http://www.GoldOnline.com, which has now
been licensed to a third party. Jewelry is developing plans to commence
operations as an e-commerce solutions provider to the Company's clients by
offering web hosting services and back office jewelry fulfillment services.

                                   FISCAL YEAR

As used throughout this document, fiscal 2001 refers to the fiscal year ended
July 31, 2001 and fiscal 2000 refers to the fiscal year ended July 31, 2000.

                         PRINCIPAL PRODUCTS AND MARKETS

HMS is a national jewelry wholesaler, specializing in 18K, 14K AND 10K gold and
platinum jewelry, with headquarters in Dallas, Texas. HMS markets its products
to a network of over 30,000 retail jewelers through a catalog and telephone
ordering system and through its B2B online catalog at http://www.HMSgold.com.
                                                      -----------------------
Silver offers a variety of luxury and premium products, including gold and
silver jewelry, neckchains, bracelets, fancy necklaces, earrings, diamond
jewelry, pre-owned high-end watches and mass-market watches.

The Company reduces gross sales by the amount of returns and discounts to
determine net sales each month. Each month a reserve is established for returns
based on the Company's historical experience, the amount of gross sales and the
customer base. The total of actual returns and the provision for returns reserve
amounted to approximately 10.4% of gross sales in fiscal 2001.


                                       3
<PAGE>

                                  DISTRIBUTION

The Company generally utilizes the services of United Parcel Service for
shipping its products.

                                   COMPETITION

The Company operates principally as a wholesale jewelry distributor, and as
such, its primary competitive factors in the industry are price, quality and
customer service. The Company's specialized customer service programs are
important competitive factors in sales to jewelry retailers. The recent trend
towards consolidation at the retail level in the jewelry industry and low labor
costs outside the United States may increase the level of competition facing the
Company. There can be no assurance that the Company will be able to compete
successfully against current and future competitors or that competitive
pressures faced by the Company will not have a material adverse effect on its
business, operating results and financial condition.

                    SOURCE AND AVAILABILITY OF RAW MATERIALS

The Company acquires its inventory from a large number of sources, the loss of
any one of which would not have a material impact on the operations of the
Company.

The  Company  uses gold  consignment  arrangements  with a gold  lender  to
supply  substantially  all of its gold  needs.  See Item 6."Management's
Discussion and Analysis - Liquidity and Capital Resources."

                           SEASONAL NATURE OF BUSINESS

The Company's business is seasonal in nature. Presented below are the Company's
net sales for each quarter of fiscal 2001 and fiscal 2000 (net sales have been
adjusted on a pro forma basis as if HMS was acquired at the beginning of fiscal
2000):
                                                                 Net Sales
                                                             ($ in thousands)
Fiscal 2001 ended July 31, 2001                               --------------
          First quarter                                         $     3,960
          Second quarter                                              5,131
          Third quarter                                               2,515
          Fourth quarter                                              2,547
                                                              --------------
             Total                                              $    14,153
                                                              ==============

Fiscal 2000 ended July 31, 2000

          First quarter                                         $     4,059
          Second quarter                                              6,338
          Third quarter                                               3,039
          Fourth quarter                                              2,763
                                                              --------------
            Total                                               $    16,199
                                                              ==============


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<PAGE>



The Company has experienced a seasonal pattern in its operating results with the
second quarter (ended January 31) typically having the highest sales. This
fluctuation is mitigated to a degree by the early placement of orders by many of
the Company's customers, particularly for the Christmas holiday season. This
accounts for the first quarter (ended October 31) having higher sales than the
third and fourth quarter. In addition, the Company markets holiday and seasonal
products year round for such occasions as Mother's Day, Valentine's Day,
Father's Day, religious holidays and school graduations.

                                 MAJOR CUSTOMERS

The Company has a large number of wholesale customers, with jewelry stores
located throughout the United States, the largest accounting for less than 2% of
net sales. Retail sales also serve a large number of customers. The loss of any
individual wholesale or retail customer would not have a material impact on the
operations of the Company.

                                    EMPLOYEES

At July 31, 2001, the Company had 53.75 equivalent employees as compared to 24.5
equivalent employees at July 31, 2000.


ITEM 2.  DESCRIPTION OF PROPERTY

At July 31, 2001, the Company maintained its corporate headquarters and its
wholesale silver jewelry inventory and operations at 111 Rhodes Street, Conroe,
Texas 77301. The office and warehouse is 7,500 square feet and is leased from
the President and principal owner of the Company for $2,200 per month. The
Company maintains its wholesale gold inventory and operations in Dallas, Texas.
The office and operations area comprises 8,075 square feet and is leased from a
company owned by the President of HMS for $8,075 per month.

At July 31, 2001, the Company also operated four retail jewelry stores in the
Houston area with aggregate monthly rent of approximately $11,900 and three
wholesale outlets in Dallas with monthly rent of approximately $5,100.

The Company also attends a number of regional shows as a part of its wholesale
silver and gold operations. Booth rental for shows averages approximately $3,800
per month.


ITEM 3.  LEGAL PROCEEDINGS

The Company is not a party to any litigation that would be material to the
Company's business or financial condition.




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<PAGE>



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

None.


ITEM 5.           MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
                  MARKET INFORMATION

SGD had been a non-reporting publicly traded company with certain of its
securities exempt from registration under the Securities Act of 1933 pursuant to
Rule 504 of Regulation D and Rule 701 of the General Rules and Regulations of
the Securities and Exchange Commission. SGD's common stock is traded on the
OTC:Bulletin Board operated by NASDAQ under the symbol SGD. SGD had not filed a
registration statement with the Securities and Exchange Commission and had not
been a reporting company under the Securities Exchange Act of 1934 prior to
April 3, 2000. The Nasdaq Stock Market implemented a change in its rules
requiring all companies trading securities on the OTC:Bulletin Board to become
reporting companies under the Securities Exchange Act of 1934.

The Company was required to become a reporting company by the close of business
on April 3, 2000, or no longer be listed on the OTC: Bulletin Board. SGD
effected a merger with Benton and has become a successor issuer thereto in order
to comply with the reporting company requirements implemented by the Nasdaq
Stock Market.

The following chart shows the quarterly high and low bid prices for the
Company's Common Stock for the last two years, as reported on the OTC: Bulletin
Board. The prices represent quotations by dealers without adjustments for retail
mark-ups, mark-downs or commissions and may not represent actual transactions.
<TABLE>
<CAPTION>

                                                           Opening         High            Low         Closing
                                                             Bid            Bid             Bid           Bid

<S>                                                       <C>             <C>              <C>          <C>

Quarter ended October 31, 1999                              $.50           $1.13           $.28          $.63
Quarter ended January 31, 2000                              $.63           $1.50           $.56          $1.00
Quarter ended April 30, 2000                                $1.00          $2.72           $.81          $2.50
Quarter ended July 31, 2000                                 $2.50          $3.25           $1.63         $1.88
Quarter ended October 31, 2000                              $1.88          $3.13           $1.63         $2.00
Quarter ended January 31, 2001                              $2.00          $2.50           $.88          $1.50
Quarter ended April 30, 2001                                $1.50          $1.97           $.70          $.75
Quarter ended July 31, 2001                                 $.75           $1.00           $.41          $.70
</TABLE>





                                       6
<PAGE>


HOLDERS

As of July 31, 2001, there were approximately 232 holders of record of the
Company's common stock, an undetermined number of which represent more than one
individual participant in securities positions with the Company.

DIVIDENDS

The Company has not previously paid cash dividends on its common stock, and
intends to utilize current resources to expand; thus, it is not anticipated that
cash dividends will be paid on the Company's common stock in the foreseeable
future.


ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF OPERATIONS

From time to time, the Company may publish forward-looking statements relative
to such matters as anticipated financial performance, business prospects,
technological developments and similar matters. The Private Securities
Litigation Reform Act of 1995 provides a safe harbor for forward-looking
statements. All statements other than statements of historical fact included in
this section or elsewhere in this report are, or may be deemed to be,
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933 and Section 21E of the Exchange Act of 1934. Important factors that
could cause actual results to differ materially from those discussed in such
forward-looking statements include: 1. General economic conditions and their
impact on the retail sales environment; 2. Fluctuations in the price of gold and
other metals used to manufacture our jewelry; 3. Customer requirements; 4.
Competition from outside the United States where labor costs are substantially
lower; and 5. Success of marketing, advertising and promotional campaigns.

The operations of the Company consist primarily of the wholesale sales of HMS
and the retail and wholesale sales of Silver. HMS is included since October 1,
2000, the effective date of its acquisition. Silver has been in operation since
1994.

LIQUIDITY AND CAPITAL RESOURCES

The Company's working capital decreased from $6,657,979 at July 31, 2000 to
$5,799,546 at July 31, 2001. The working capital decrease of $858,433 is
primarily the result of including one of the two payments due on the HMS
purchase, in the amount of $1,250,000, in current liabilities.

On October 23, 2000, the Company completed the acquisition of the business and
assets of HMS Jewelry Co., Ltd., a Texas limited partnership, and HMS Operating
Company, a Texas corporation, (collectively "HMS") for $7 million, $4.5 million
in cash and $2.5 million in convertible secured promissory notes. The purchase
also included $47,500 in legal and professional costs. The notes bear interest
at eight percent (8%) per annum and require monthly payment of interest. The
notes are convertible into the Company's common stock at $1.25 per



                                       7
<PAGE>


share, as adjusted for any stock splits or combinations. One note in the amount
of $1.25 million is due October 15, 2001 and the other note in the amount of
$1.25 million is due October 15, 2002. On October 15, 2001, the Company received
a loan from a related party in the amount of $675,000, paid one-half of the
$1,250,000 note due on that date and extended the balance of $625,000 until
April 15, 2002 with the same terms as the original note.

HMS is a wholesale jewelry distributor with headquarters in Dallas, Texas. HMS
primarily sells gold products to a network of over 30,000 retail jewelers,
through a catalog and telephone ordering system. For the year ended July 31,
2000, unaudited pro forma combined sales would have been $16,200,000, net
earnings would have been $492,000 and net earnings per share would have been
$0.006.

Prior to closing the HMS transaction, the Company sold 1.1 million shares of its
common stock for net proceeds of $1,567,500 and utilized these funds plus
existing cash reserves to make the initial cash payment.

HMS relies on a gold consignment program, short-term borrowings and internally
generated funds to finance its inventories and accounts receivable. HMS fills
most of its gold supply needs through a gold consignment arrangement with a gold
lender. Under the terms of that arrangement, HMS is entitled to lease the lesser
of an aggregate of 13,200 ounces of fine gold or an aggregate consigned gold
value not to exceed $3,450,000. The consigned gold is secured by substantially
all property of HMS, including its cash, accounts receivable, inventory and
machinery and equipment and the corporate guaranty of SGD. HMS pays the gold
lender a consignment fee based on the dollar value of ounces of gold outstanding
under their agreement, which value is based on the daily Second London Gold Fix.
HMS believes that its financing rate under the consignment arrangement is
substantially similar to the financing rates charged to gold consignees
similarly situated to HMS. As of July 31, 2001, HMS held 10,251 ounces of gold
on consignment with a market value of $2,725,741.

The consignment agreement contains restrictive covenants relating to maximum
usage, net worth, working capital and other financial rations and the agreement
requires HMS to own a specific amount of gold at all times. At July 31, 2001,
HMS was in compliance with all of the covenants in the consignment agreement.

The consignment agreement is terminable by the gold lender upon 60 days notice.
If the gold lender were to terminate its existing gold consignment arrangement,
HMS does not believe it would experience an interruption of its gold supply that
would materially adversely affect its business. HMS believes that other
consignors would be willing to enter into similar arrangements should its gold
lender terminate its relationship with the company.

Consigned gold is not included in inventory, and there is no related liability
recorded. As a result of these consignment arrangements, HMS is able to shift a
substantial portion of the risk of market fluctuations in the price of gold to
the gold lender, since HMS does not purchase gold from the gold lender until
receipt of a purchase order from, or shipment of jewelry to, its customers.



                                       8
<PAGE>


While we believe our supply of gold is relatively secure, significant increases
or rapid fluctuations in the cost of gold may impact the demand for our
products. During the past two years, the monthly average for the closing price
of gold according to the Second London Gold Fix ranged from a low of $262.00 per
ounce to a high of $316.00 per ounce. Fluctuations in the precious metals
markets and credit may result in an interruption of our gold supply or the
credit arrangements necessary to allow us to support our accounts receivable and
continue the use of consigned gold.

The gold lender has also provided a line of credit to HMS in the amount of
$1,500,000 that is due on demand, including interest at the lender's prime rate
plus 3/4%. HMS does not have any advances on this line of credit at July 31,
2001.

During fiscal 2001, the Company had $1,381,735 in cash used in operating
activities. The most significant use of cash was a reduction in accounts payable
of $1,081,845. Other major uses of cash included an increase in inventory of
$614,282, use of $333,587 in cash to acquire marketable equity securities and an
unrealized gain on marketable equity securities of $239,973. Major increases in
cash include a reduction of $525,959 in accounts receivable and depreciation and
amortization of $299,201.

The Company used $3,046,204 in investing activities, which included $2,787,872
for the acquisition of HMS, net of cash received.

The Company had $858,636 in net cash provided by financing activities. This
included proceeds from sale of common stock of $1,567,500, use of $500,000 for a
loan and $202,820 used to reduce long-term debt and notes payable, including
related party notes.

The Company is currently budgeting $100,000 for capital expenditures for fiscal
2002. This includes approximately $50,000 to complete the software and hardware
for the management information system to be used in the operations of Silver.
The Company anticipates the inventory management capabilities of the new
software will allow them to be more efficient and operate at much lower
inventory levels.

SALES AND COST OF SALES

Sales increased $10,614,722 (649%) to $12,249,684 in fiscal 2001 as compared to
$1,634,962 in fiscal 2000. The main reason for the increase in sales was the
acquisition of HMS effective October 1, 2000. On a pro forma basis, as if HMS
were acquired at the beginning of fiscal 2000, sales would have been $14,153,000
in fiscal 2001 and $16,199,000 in fiscal 2000, a decrease of 12.6%. Sales and
related cost of sales may be summarized as follows:




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<PAGE>


                                                     2001                2000

Sales and revenues:
  HMS                                       $     9,755,241    $              -
  Silver and other                                2,494,443           1,634,962
                                                -----------          ----------
    Recorded sales                               12,249,684           1,634,962
  HMS pro forma                                   1,903,316          14,564,038
                                                -----------          ----------
    Pro forma sales and revenue                  14,153,000          16,199,000

Cost of sales:
  HMS                                             6,792,626                   -
  Silver and other                                1,083,931             824,585
                                                -----------          ----------
    Recorded cost of sales                        7,876,557             824,585
                                                -----------          ----------
  HMS pro forma                                   1,425,238          10,780,192
                                                -----------          ----------
    Pro forma cost of sales                       9,301,795          11,604,777
                                                -----------          ----------
Pro forma gross profit                      $     4,851,205    $      4,594,223
                                                ===========          ==========


On a pro forma basis, HMS sales decreased $2,905,481 (19.9%) from $14,564,038 in
fiscal 2000 to $11,658,557 in fiscal 2001. HMS is more negatively impacted by
the economy than the operations of Silver. This is primarily an issue of price,
with more customers opting for cheaper silver jewelry when the economy is slow.
This accounts for part of the Silver's sales increase, with retail sales
increasing 78% (73% from new store sales and 5% from same store sales increases)
and wholesale sales increases of 48%. Silver's sales include 39% from retail
sales and 61% from wholesale sales during fiscal 2001 as compared to 35% retail
and 65% wholesale in fiscal 2000.

Gross profit margins, on a pro forma basis, improved from 28.4% in fiscal 2000
to 34.3% in fiscal 2001. Both segments had improved gross profit margins with
HMS improving from 26.0% to 29.5% and Silver improving from 49.6% to 56.5%.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

                                SILVER AND OTHER

Silver and other selling, general and administrative expenses increased from
$1,082,243 in fiscal 2000 to $1,975,948 in fiscal 2001.

Labor and benefit costs accounted for $436,139 of the increase, with a fiscal
2000 amount of $413,802 and a fiscal 2001 amount of $849,941. During fiscal
2001, personnel increased from 24.5 equivalent employees to 31.75 equivalent
employees by the end of the year. In addition to adding two retail locations,
the Company also added three wholesale locations. Commission increased $51,150
during fiscal 2001, which included $23,742 in retail commissions and $27,408 in
wholesale commissions. Wholesale commission increases are primarily due to staff
increases which have resulted in corresponding sales increases. In addition, the
Company began offering group medical coverage during fiscal 2001, which amounted
to $35,890 for the seven



                                       10
<PAGE>


months it was in effect. A portion of the labor increase is a result of the
installation and implementation of an inventory and accounting system which will
provide substantially improved inventory tracking and monitoring, thus allowing
for improved ordering and better management of the inventory asset.

Rent expense for Silver increased $127,572 from $124,062 in fiscal 2000 to
$251,634 in fiscal 2001, principally due to the addition of two retail and three
wholesale locations, which account for $123,965 of the increase.

During fiscal 2001, the Company updated their catalog and also opened two new
retail locations, resulting in advertising and promotional expense increases
from $4,684 during fiscal 2000 to $76,544 during fiscal 2001.

The remaining costs increased $258,134 (47.8%) to $797,829 in fiscal 2001 from
$539,695 in fiscal 2000. This increase includes increases in most expense
categories and is consistent with the 52.6% sales increase.

Silver is currently implementing a new inventory and sales tracking system which
is expected to provide a substantially improved method of monitoring inventory
levels and sales trends. The implementation process has contributed to the
increased selling, general and administrative costs.

                              GOLD OPERATIONS (HMS)

Selling, general and administrative expenses for HMS for the ten-month period
since October 1, 2000 amounted to $2,420,681. On a pro forma basis, selling,
general and administrative expenses amounted to $2,708,359 for fiscal 2001 and
$2,207,716 for fiscal 2000, an increase of $500,643 (22.7%).

Goodwill amortization expense in fiscal 2001 was $205,330 as a result of the
acquisition of HMS which was effective October 1, 2000. There was no
amortization expense in fiscal 2000.

Accounting and legal costs increased $105,109 (203%) from $51,660 in fiscal 2000
to $156,769 in fiscal 2001. The majority of this cost increase is the result of
items which should not recur, including costs associated with the purchase of
HMS by SGD and approximately $16,000 in costs associated with a data recovery
process which was required when both the main server hard drive failed and the
mirror image backup also failed.

Officer compensation increased $115,112 from $39,888 in fiscal 2000 to $155,000
in fiscal 2001. This increase is a result of the employment agreement for the
president of HMS.

Rent expense decreased $92,033 from $282,858 in fiscal 2000 to $190,825 in
fiscal 2001. The decrease is a result of the change in the lease on the HMS
facility. This rent was reduced from $20,000 per month to $8,075 per month and
substantially offsets the increase in officer

                                       11
<PAGE>


Bad debt expense increased $56,105 from $208 in fiscal 2000 to $56,313 in fiscal
2001. With only $208 in net bad debt expense in fiscal 2000, the net write-offs
were substantially below the normal level. The experience in fiscal 2001 of .48%
is more comparable to historical results.

Advertising expense increased $36,300 (15.6%) from $232,716 in fiscal 2000 to
$269,017 in fiscal 2001. During fiscal 2000, the company experienced its highest
level of revenues in its history. The initial part of fiscal 2001 advertising
was based on this higher sales level. In addition, the company initiated flyer
programs with an increased cost of $16,483 from $8,717 in fiscal 2000 to $25,201
in fiscal 2001.

The company is partially self insured for health insurance claims. This
increased $31,838 to $48,251 in fiscal 2001 from $16,413 in fiscal 2000. This
type of item can vary widely due to the relatively small group size, 22 at the
end of fiscal 2001. The company's maximum exposure is $5,800 per claim.

All other costs of $1,626,854 in fiscal 2001 increased $42,882 (2.7%), net from
the fiscal 2000 total.

GOLD CONSIGNMENT FEE

The gold consignment fee charged by the gold lender for HMS during the ten-month
period HMS was owned by SGD amounted to $125,094 in fiscal 2001.

INTEREST EXPENSE

Interest expense increased from $30,515 ($4,088 to related parties) in fiscal
2000 to $212,265 ($180,015 to related parties) in fiscal 2001. The increase
relates primarily to the acquisition of HMS. Related party interest includes
$166,667 on the debt incurred in the acquisition of HMS and $9,349 on HMS debt
owed to its president.

UNREALIZED GAIN ON MARKETABLE SECURITIES

In fiscal 2001, the Company recognized an unrealized gain in the amount of
$239,973 on their investment in trading securities. The Company did not own any
trading securities in fiscal 2000.

INTEREST AND OTHER INCOME

Interest and other income increased from $61,268 in fiscal 2000 to $235,365 in
fiscal 2001. The majority of this income is from interest on cash deposits. The
Company had a substantially higher average cash balance during fiscal 2001 than
they had in fiscal 2000.




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<PAGE>


INCOME TAXES

Income tax benefit amounted to $3,423 during fiscal 2001 as compared to $26,456
during fiscal 2000. The income tax benefit during fiscal 2000 would have been
$80,456, due primarily to the net operating loss for the period; however, the
Company elected to establish a valuation allowance of $54,000 and reduced the
deferred tax asset and income tax benefit by this amount. During fiscal 2001,
the Company was profitable and determined that their income tax net operating
loss would, more likely than not, be recoverable from future earnings.
Accordingly, the Company reversed the $54,000 valuation allowance they had
recorded in fiscal 2000.

NEW ACCOUNTING STANDARDS

In June 1998, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 133 (SFAS No, 133), "Accounting for
Derivative Instruments and Hedging Activities," which was amended by Statement
of Financial Accounting Standards No. 138. This Statement standardized the
accounting for derivative instruments by requiring that an entity recognize the
items as assets and liabilities in the statement of financial position and
measure them at fair value. SFAS No. 133 was to become effective for fiscal
years beginning after June 15, 1999; however, in June 1999, Statement of
Financial Accounting Standards No. 137 was issued extending the effective date
to June 15, 2000. The Company adopted this Statement on August 1, 2000 and there
was no effect of the adoption on the results of operations or financial
position.

In June 2001,  the  Financial  Accounting  Standards  Board issued  Statement of
Financial Accounting Standards No. 141 (SFAS No. 141), "Business  Combinations,"
and  Statement  of  Financial  Accounting  Standards  No.  142 (SFAS  No.  142),
"Goodwill  and  Other  Intangible  Assets."  SFAS No.  141  addresses  financial
accounting  and reporting for business  combinations  and supersedes APB Opinion
No. 16,  "Business  Combinations,"  and FASB Statement No. 38,  "Accounting  for
Preacquisition   Contingencies   of   Purchased   Enterprises."   All   business
combinations  in the  scope of SFAS No.  141 are to be  accounted  for using one
method,  the  purchase  method.  The  provisions  of SFAS No.  141  apply to all
business  combinations  initiated  after June 30,  2001 or for which the date of
acquisition  is July 1, 2001, or later.  The Company  adopted this  Statement on
August  1,  2001  with no  effect on the  results  of  operations  or  financial
position.

SFAS No. 142 addresses financial accounting and reporting for acquired goodwill
and other intangible assets and supercedes APB Opinion No. 17, "Intangible
Assets." It addresses how intangible assets that are acquired individually or
with a group of other assets (but not those acquired in a business combination)
should be accounted for in financial statements upon their acquisition. This
Statement also addresses how goodwill and other intangible assets should be
accounted for after they have been initially recognized in the financial
statements. The provisions of this Statement are required to be applied starting
with fiscal years beginning after December 15, 2001. Early application is
permitted for entities with fiscal years beginning after March 15, 2001,
provided that the first interim financial statements have not previously been
issued. This Statement is required to be applied at the beginning of an entity's
fiscal year and to



                                       13
<PAGE>


be applied to all goodwill and other intangible assets recognized in its
financial statements at that date. Impairment losses for goodwill and
indefinite-lived intangible assets that arise due to the initial application of
this Statement (resulting from a transitional impairment test) are to be
reported as resulting from a change in accounting principle. The Company has
elected to adopt this Statement effective August 1, 2001. The Company does not
expect to record an impairment loss as a result of the initial application of
this Statement. Goodwill amortization expense during fiscal 2001 and fiscal
2000, would have been $213,608 less and $6,672 less, respectively, had the
Statement been in effect during those years.


ITEM 7.  FINANCIAL STATEMENTS

The Consolidated Financial Statements of SGD Holdings, LTD, formerly Goldonline
International, Inc., and Subsidiaries, together with the report thereon of
Stephen P. Higgins, C.P.A. dated September 18, 2001 (October 15, 2001 as to Note
15) for the years ended July 31, 2001 and 2000 is set forth as follows:


                   Index to Consolidated Financial Statements


                                                                   Page
                                                                    No.

Index                                                               14

Auditors Report                                                     15

Consolidated Balance Sheet                                          16

Consolidated Statements of Operations                               17

Consolidated Statement of Stockholders' Equity                      18

Consolidated Statements of Cash Flows                              19-20

Notes to Consolidated Financial Statements                         21-35




                                       14
<PAGE>

                           Stephen P. Higgins, C.P.A.
                               67 Dumbarton Drive
                           Huntington, New York 11743






Board of Directors
SGD Holdings, Ltd. (formerly Goldonline
  International, Inc.) and Subsidiaries


We have audited the accompanying consolidated balance sheet of SGD Holdings,
Ltd. (formerly Goldonline International, Inc.) and Subsidiaries as of July 31,
2001, and the related consolidated statements of operations, changes in
stockholders' equity, and cash flows for each of the two years in the period
ended July 31, 2001. These consolidated financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the consolidated
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the consolidated financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of SGD Holdings, Ltd.
(formerly Goldonline International, Inc.) and subsidiaries as of July 31, 2001
and the results of their operations and their cash flows for each of the two
years in the period ended July 31, 2001 in conformity with accounting principles
generally accepted in the United States of America.


                                                   s/ Stephen P. Higgins, C.P.A.



September 18, 2001
(October 15, 2001 as to Note 15)
Huntington, New York

                                       15
<PAGE>

<TABLE>
<CAPTION>

SGD HOLDINGS, LTD. AND SUBSIDIARIES
(Formerly Goldonline International, Inc.)
Consolidated Balance Sheet
July 31, 2001

<S>                                                                                                       <C>

Assets
Current assets
  Cash and cash equivalents                                                                                 $ 2,399,898
  Accounts receivable, net of allowance of $75,139                                                            1,024,510
  Marketable investment securities                                                                              657,000
  Note receivable                                                                                               500,000
  Inventory                                                                                                   3,018,042
  Prepaid expenses and other assets                                                                             123,523
  Due from related parties
                                                                                                                  9,309
  Deferred income taxes                                                                                          63,100
                                                                                                     -------------------
Total current assets                                                                                          7,795,382
                                                                                                     -------------------
Property and equipment, net                                                                                     474,257
Marketable investment securities                                                                                429,550
Deposits                                                                                                        128,438
Goodwill, less accumulated amortization of $221,392                                                           3,600,951
                                                                                                     -------------------
                                                                                                           $ 12,428,578
                                                                                                     ===================

Liabilities and Stockholders' Equity
Current liabilities
  Current installments of long-term debt and notes payable                                                   $  182,534
  Notes payable due related parties                                                                           1,355,153
  Accounts payable                                                                                              330,457
  Accured expenses                                                                                              124,306
  Due to shareholder
                                                                                                                  3,386
                                                                                                     -------------------
Total current liabilities                                                                                     1,995,836
                                                                                                     -------------------
Long-term debt less current installments                                                                         70,142
Notes payable due related party                                                                               1,250,000
Deferred income taxes payable
                                                                                                                  9,200

Stockholders' equity
  Common stock, $.0001 par value.  Authorized 200,000,000 shares; issued and
    outstanding 97,099,408 shares
                                                                                                                  9,710
  Paid-in capital                                                                                             9,098,284
  Deficit                                                                                                       (4,594)
                                                                                                     -------------------
Total stockholders' equity                                                                                    9,103,400
                                                                                                     -------------------
                                                                                                           $ 12,428,578
                                                                                                     ===================

See accompanying notes to consolidated financial statements.


</TABLE>
                                       16
<PAGE>


SGD HOLDINGS, LTD. AND SUBSIDIARIES
(Formerly Goldonline International, Inc.)
Consolidated Statements of Operations
Years ended July 31, 2001 and July 31, 2000
<TABLE>
<CAPTION>



                                                                                       Year                Year
                                                                                      Ended                Ended
                                                                                  July 31, 2001        July 31, 2000

<S>                                                                             <C>                  <C>

Sales and revenues                                                                    $ 12,249,684          $1,634,962
Cost of sales                                                                            7,876,557             824,585
                                                                                -------------------  ------------------
Gross profit                                                                             4,373,127             810,377
  Selling, general and administrative expense                                            4,396,629           1,082,243
                                                                                -------------------  ------------------
Loss from operations                                                                       (23,502)           (271,866)

Other income (expense)
  Interest expense                                                                         (32,250)            (26,427)
  Interest expense - related parties                                                      (180,015)             (4,088)
  Gold consignment fee                                                                    (125,094)                  -
  Unrealized gain on marketable securities                                                 239,973                   -
  Interest and other income                                                                235,365              61,268
                                                                                -------------------  ------------------
                                                                                           137,979              30,753
                                                                                -------------------  ------------------
Earnings (loss) before income taxes                                                        114,477            (241,113)
Income tax expense (benefit)                                                                (3,423)            (26,456)
                                                                                -------------------  ------------------
Net earnings (loss)                                                                     $  117,900          $ (214,657)
                                                                                ===================  ==================

Basic and diluted earnings (loss) per share                                              $   0.001           $  (0.002)
                                                                                ===================  ==================

Weighted Average Shares Outstanding                                                     95,899,696          89,381,618
                                                                                ===================  ==================


See accompanying notes to consolidated financial statements.




                                       17
</TABLE>
<PAGE>



SGD HOLDINGS, LTD. AND SUBSIDIARIES
(Formerly Goldonline International, Inc.)
Consolidated Statement of Stockholders' Equity
Years ended July 31, 2001 and July 31, 2000
<TABLE>
<CAPTION>


                                                                                                   Retained
                                                     Common Stock                 Paid-in          Earnings
                                               Shares          Par Value          Capital         (Deficit)           Total
<S>                                         <C>              <C>             <C>               <C>              <C>

Balance, August 1, 1999                        86,996,408           $ 8,700          $217,420         $ 92,163          $318,283
Options exercised for cash                         50,000                 5             1,695                -             1,700
Options exercised for services                     58,000                 5            18,119                -            18,124
Common shares sold for cash                     5,080,000               508         5,976,992                -         5,977,500
Warrants exercised for cash                     1,600,000               160           799,840                -           800,000
Merger with Benton Ventures                     1,200,000               120             (120)                -                 -
Net loss                                                -                 -                 -        (214,657)         (214,657)
                                            --------------   ---------------  ----------------  ---------------  ----------------
Balance, July 31, 2000                         94,984,408             9,498         7,013,946        (122,494)         6,900,950
                                            --------------   ---------------  ----------------  ---------------  ----------------
Common shares sold for cash                     1,100,000               110         1,567,390                          1,567,500
Common shares issued:
  For services                                     50,000                 5            87,495                -            87,500
  For investment                                  965,000                97           429,453                -           429,550
Net earnings                                            -                 -                 -          117,900           117,900
                                            --------------   ---------------  ----------------  ---------------  ----------------
Balance, July 31, 2001                         97,099,408           $ 9,710        $9,098,284        $ (4,594)        $9,103,400
                                            ==============   ===============  ================  ===============  ================



See accompanying notes to consolidated financial statements.





                                       18
</TABLE>
<PAGE>



SGD HOLDINGS, LTD. AND SUBSIDIARIES
(Formerly Goldonline International, Inc.)
Consolidated Statements of Cash Flows
Years ended July 31, 2001 and July 31, 2000
<TABLE>
<CAPTION>

                                                                                 Year                 Year
                                                                                Ended                 Ended
                                                                            July 31, 2001         July 31, 2000
<S>                                                                        <C>                   <C>

Cash flows used in operating activities
Net earnings (loss)                                                               $ 117,900           $  (214,657)
Adjustments to reconcile net earnings (loss) to net
 cash used in operating activities:
  Depreciation and amortization                                                     299,201                47,335
  Deferred income taxes                                                              (3,423)              (26,456)
  Unrealized gain on marketable equity securities                                  (239,973)                    -
  Purchase of marketable equity securities                                         (333,587)                    -
  Deferred revenue realized                                                         (52,145)                    -
  Common stock issued for services                                                        -                18,125
  Provision for bad debts                                                             2,217                11,595
  Gain on sale of assets                                                             (7,054)                    -
  Refund from tax net operating loss carryback                                       18,623                     -
  Accounts receivable                                                               525,959               (67,164)
  Inventory                                                                        (614,282)             (512,130)
  Other assets                                                                      (92,135)              (85,250)
  Accounts payable                                                               (1,081,845)               46,550
  Accrued expenses                                                                   78,809                (1,750)
                                                                          -------------------  -------------------
Net cash used in operating activities                                            (1,381,735)             (783,802)
                                                                          -------------------  -------------------

Cash flows used in investing activities
  Capital expenditures                                                             (153,332)              (23,628)
  Acquisition of HMS net of cash acquired                                        (2,787,872)                    -
  Acquisition of Native Trade                                                      (105,000)                    -
                                                                          -------------------  -------------------
Net cash used in investing activities                                            (3,046,204)              (23,628)
                                                                          -------------------  -------------------

Cash flows provided by financing activities
  Proceeds from sale of common stock                                              1,567,500             6,779,200
  Loan proceeds                                                                       2,336                50,000
  Repayment of long-term debt and notes payable                                    (202,820)              (77,440)
  Amounts due to and from related parties                                            (8,380)               (9,555)
  Loan advanced                                                                    (500,000)                    -
                                                                          -------------------  -------------------
Net cash provided by financing activities                                           858,636             6,742,205
                                                                          -------------------  -------------------
Net increase in cash and cash equivalents                                        (3,569,303)            5,934,775
Cash and cash equivalents, beginning of period                                    5,969,201                34,426
                                                                          -------------------  -------------------
Cash and cash equivalents, end of period                                        $ 2,399,898           $ 5,969,201
                                                                          ===================  ====================

See accompanying notes to consolidated financial statements.
                                                                                               (Continued)




                                       19
</TABLE>
<PAGE>



SGD HOLDINGS, LTD. AND SUBSIDIARIES
(Formerly Goldonline International, Inc.)
Consolidated Statements of Cash Flows, Continued
Years ended July 31, 2001 and July 31, 2000
<TABLE>
<CAPTION>


                                                                                      Year                  Year
                                                                                      Ended                Ended
                                                                                  July 31, 2001        July 31, 2000
<S>                                                                              <C>                  <C>

Supplemental Cash Flow Information

Cash paid for interest and income taxes are as follows:
  Interest and gold consignment fee                                                   $   333,359             $  26,427
  Income taxes                                                                        $         -             $   5,384

Noncash investing and financing activities are as follows:


Acquisition of equipment in exchange for long-term debt                               $    62,376             $  19,462
Financed insurance premiums                                                           $    26,136             $       -
Notes payable due related party, issued as part of
  acquisition of HMS                                                                  $ 2,500,000             $       -
Common stock issued for marketing agreement                                           $    87,500             $       -
Common stock issued for investment in marketable securities                           $   429,550             $       -












See accompanying notes to consolidated financial statements.





                                       20
</TABLE>
<PAGE>


SGD HOLDINGS, LTD. AND SUBSIDIARIES
(Formerly Goldonline International, Inc.)
Notes to Consolidated Financial Statements


1.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

          Principles of consolidation and presentation
          The consolidated financial statements include the accounts of SGD
          Holdings,  Ltd. (formerly Goldonline  International,  Inc.)
          ("SGD") and its wholly owned subsidiaries  Con-Tex Silver Imports,
          Inc.  ("Silver"),  HMS Jewelry Company,  Inc. ("HMS") and Jewelry
          Solutions  &  Commerce,  Inc.  (formerly  Gold  Online.com,  Inc.)
          ("Jewelry")  (collectively  referred  to as  the "Company").  All
          material intercompany accounts and transactions have been eliminated.

          Organization
          SGD was incorporated May 22, 1996 in Delaware as Transun International
          Airways,  Inc. and until June 1999 was a development stage  company
          with plans to establish  itself as an air  transport  company
          providing  non-scheduled  air service  (charter flights) for tour
          operators,  charter brokers, cruise line casinos, theme parks and
          theme attractions.  Transun International Airways, Inc. changed its
          name to Goldonline  International,  Inc. on June 10, 1999. Goldonline
          International,  Inc. changed its name to SGD Holdings, Ltd. on
          January 24, 2001.

          Silver was incorporated September 12, 1994 in Texas. HMS was
          incorporated October 12, 2000 in Texas. Jewelry was incorporated on
          February 3, 1999 in Delaware.

          On June 10, 1999, SGD acquired all of the issued and outstanding
          common stock of Silver and Jewelry. For accounting purposes, the
          acquisitions were treated as the acquisition of Silver and Jewelry by
          SGD with Silver as the acquiror (reverse acquisition). The historical
          financial statements prior to June 10, 1999 are those of Silver.

          On October 26, 2000, SGD completed the acquisition of HMS Jewelry Co.,
          Ltd., a Texas limited partnership and HMS Operating Company, a Texas
          corporation and transferred the assets acquired and liabilities
          assumed into HMS Jewelry Company, Inc. For accounting purposes, the
          acquisition was treated as a purchase.

          Merger
          On April 20, 2000, pursuant to an agreement and plan of reorganization
          dated April 11, 2000, SGD acquired 100% of the issued and outstanding
          common stock of Benton Ventures, Inc. ("Benton"), a Delaware
          corporation, in exchange for 1,200,000 newly issued common shares of
          SGD. On April 25, 2000, the Board of Directors of SGD elected to merge
          Benton into SGD pursuant to Section 253 of Delaware's General
          Corporate Laws. As a result of the merger, SGD became the surviving
          company and assumed the reporting responsibilities under successor
          issuer status as more fully detailed in Section 12(g)(3) of The
          Securities Exchange Act of 1934. Benton was a dormant company and its
          assets and liabilities were insignificant; accordingly, no pro forma
          information is presented.



                                       21
<PAGE>



          Nature of business
          SGD is a holding company principally engaged in acquiring and
          developing jewelry businesses. HMS is primarily involved in the
          wholesale gold jewelry business. Silver is involved in both the
          wholesale and retail jewelry business, principally silver. Jewelry now
          operates as an e-commerce solutions provider to the Company's clients
          by offering web hosting services and back office jewelry fulfillment
          services.

          Cash equivalents
          The Company considers all liquid investments with original maturities
          of three months or less to be cash equivalents. At July 31, 2000, cash
          equivalents consist of money fund investments, money market accounts
          and business checking accounts.

          Marketable investment securities
          Marketable investment securities are classified into the following
          categories:
               o     Trading securities reported at fair value with unrealized
                     gains and losses included in earnings;
               o     Available-for-sale securities reported at fair value with
                     unrealized gains and losses, net of deferred income taxes,
                     reported in other comprehensive income; and
               o     Held-to-maturity securities reported at amortized cost.

          Inventories
          Inventories consist primarily of gold and silver jewelry and are
          carried at the lower of average cost or market.

          The Company satisfies a majority of its gold supply needs through a
          gold consignment agreement with a financial institution that leases
          gold to the Company ("gold lender"). In accordance with the terms of
          the agreements, the Company has the option of repaying the gold lender
          in an equivalent number of ounces of fine gold or cash based upon the
          then quoted London Bullion Brokers' second fixing price.

          Machinery and equipment
          Owned machinery and equipment are stated at cost and depreciated using
          the straight-line method over the estimated useful lives of the
          respective assets.

          Goodwill
          Costs in excess of the fair value of net assets acquired are amortized
          over a fifteen-year period on a straight-line basis. The carrying
          value of goodwill is reviewed if the facts and circumstances suggest
          that it may be impaired. If this review indicates that goodwill will
          not be recoverable, the Company's carrying value of the goodwill would
          be reduced.



                                       22
<PAGE>


          Income taxes
          The Company accounts for income taxes under the provisions of
          Statement of Financial Accounting Standards No. 109, "Accounting for
          Income Taxes" ("SFAS 109"). Under SFAS 109, the liability method is
          used in accounting for income taxes and deferred tax assets and
          liabilities are determined based on differences between the financial
          reporting and tax bases of assets and liabilities. Deferred tax assets
          and liabilities are measured using enacted tax rates expected to apply
          to taxable income in the years in which those temporary differences
          are expected to be recovered or settled. The effect on deferred tax
          assets and liabilities of a change in tax rates is recognized in
          income in the period that includes the enactment date.

          Revenue and cost recognition
          Sales revenues are recognized when the product is shipped. Cost of
          sales, which is recognized simultaneously with the recognition of
          sales, is comprised of the cost of materials and indirect costs
          incurred during the manufacturing process.

          Allowance for sales returns
          The Company reduces gross sales by the amount of discounts and returns
          to determine net sales. Each month the Company estimates a reserve for
          returns based on historical experience and the amount of gross sales.
          The reserve is adjusted periodically to reflect the Company's actual
          return experience.

          Catalog costs
          Catalog costs are charged to expense as incurred, the only exception
          being major catalog revisions. Costs capitalized are amortized over
          the units of catalogs shipped, up to a maximum of two years. At July
          31, 2001, there were no unamortized catalog revision costs
          capitalized.

          Shipping and handling costs
          Shipping and handling costs billed to customers are recorded as
          revenue. The costs associated with shipping goods to customers are
          recorded as a selling expense. Shipping expenses, which include only
          third party costs of shipping, for the years ended July 31, 2001 and
          July 31, 2000 were $264,000 and $22,600, respectively.

          Stock option plans
          The Company applies the intrinsic value-based method of accounting
          prescribed by Accounting Principals Board ("APB") Opinion No. 25,
          "Accounting for Stock Issued to Employees," and related
          interpretations, in accounting for its stock option plan. As such,
          compensation expense would be recorded on the date of grant only if
          the current market price of the underlying stock exceeded the exercise
          price.


                                       23
<PAGE>

          Net earnings (loss) per share
          Net earnings (loss) per share amounts are computed using the weighted
          average number of shares outstanding during the period. Fully diluted
          earnings (loss) per share is presented if the assumed conversion of
          common stock equivalents results in material dilution.

          Use of estimates
          The process of preparing consolidated financial statements in
          conformity with generally accepted accounting principles requires the
          use of estimates and assumptions regarding certain types of assets,
          liabilities, revenues and expenses. Such estimates primarily relate to
          unsettled transactions and events as of the date of the consolidated
          financial statements. Accordingly, upon settlement, actual results may
          differ from estimated amounts.

          Fair value determination
          Financial instruments consist of cash, cash investments, accounts
          receivable, accounts payable, accrued liabilities, notes payable and
          long-term debt. The carrying amount of these financial instruments
          approximates fair value due to their short-term nature or the current
          rates which the Company could borrow funds with similar remaining
          maturities.

          Recent accounting pronouncements
          In June 1998, the Financial Accounting Standards Board issued
          Statement of Financial Accounting Standards No. 133 (SFAS No, 133),
          "Accounting for Derivative Instruments and Hedging Activities," which
          was amended by Statement of Financial Accounting Standards No. 138.
          This Statement standardized the accounting for derivative instruments
          by requiring that an entity recognize the items as assets and
          liabilities in the statement of financial position and measure them at
          fair value. SFAS No. 133 was to become effective for fiscal years
          beginning after June 15, 1999; however, in June 1999, Statement of
          Financial Accounting Standards No. 137 was issued extending the
          effective date to June 15, 2000. The Company adopted this Statement on
          August 1, 2000 and there was no effect of the adoption on the results
          of operations or financial position.

          In June 2001, the Financial  Accounting  Standards Board issued
          Statement of Financial Accounting Standards No. 141 (SFAS No. 141),
          "Business  Combinations," and Statement of Financial  Accounting
          Standards No. 142 (SFAS No. 142), "Goodwill and Other Intangible
          Assets." SFAS No. 141 addresses financial  accounting and reporting
          for business  combinations and supersedes APB Opinion No. 16,
          "Business  Combinations,"  and FASB  Statement  No. 38,  "Accounting
          for  Preacquisition  Contingencies  of Purchased  Enterprises."
          All business  combinations  in the scope of SFAS No. 141 are to be
          accounted  for using one method, the purchase method. The provisions
          of SFAS No. 141 apply to all business  combinations  initiated after
          June 30, 2001 or for which the date of  acquisition  is July 1, 2001,
          or later.  The Company  adopted  this  Statement  on August 1, 2001
          with no effect on the results of operations or financial position.



                                       24
<PAGE>



          SFAS No. 142 addresses financial accounting and reporting for acquired
          goodwill and other intangible assets and supercedes APB Opinion No.
          17, "Intangible Assets." It addresses how intangible assets that are
          acquired individually or with a group of other assets (but not those
          acquired in a business combination) should be accounted for in
          financial statements upon their acquisition. This Statement also
          addresses how goodwill and other intangible assets should be accounted
          for after they have been initially recognized in the financial
          statements. The provisions of this Statement are required to be
          applied starting with fiscal years beginning after December 15, 2001.
          Early application is permitted for entities with fiscal years
          beginning after March 15, 2001, provided that the first interim
          financial statements have not previously been issued. This Statement
          is required to be applied at the beginning of an entity's fiscal year
          and to be applied to all goodwill and other intangible assets
          recognized in its financial statements at that date. Impairment losses
          for goodwill and indefinite-lived intangible assets that arise due to
          the initial application of this Statement (resulting from a
          transitional impairment test) are to be reported as resulting from a
          change in accounting principle. The Company has elected to adopt this
          Statement effective August 1, 2001. The Company does not expect to
          record an impairment loss as a result of the initial application of
          this Statement. Goodwill amortization expense during fiscal 2001 and
          fiscal 2000, would have been $213,608 less and $6,672 less,
          respectively, had the Statement been in effect during those years.

          Reclassifications
          Certain reclassifications were made to the prior year's financial
          statements to conform to the current year's presentation.


2.       ACQUISITION

          Effective October 1, 2000, the Company acquired, pursuant to an
          Agreement and Plan of Merger the operations and business of HMS, in
          exchange for $4,500,000 in cash and convertible promissory notes in
          the amount of $2,500,000. The purchase also included $47,500 in legal
          and professional costs. The transaction resulted in the merger of the
          business and operations of HMS Jewelry Co., Ltd., a Texas limited
          partnership and HMS Operating Company, a Texas corporation into a
          newly formed subsidiary of the Company, HMS Jewelry Company, Inc. HMS
          is a national jewelry wholesaler, specializing in 18K, 14K and 10K
          gold and platinum jewelry, with headquarters in Dallas, Texas. HMS
          markets its products to a network of over 30,000 retail jewelers,
          through a catalog and telephone ordering system and through its B2B
          online catalog http://www.HMSgold.com.
                         ----------------------

          The acquisition was accounted for by the purchase method of accounting
          and, accordingly, the statements of consolidated income include the
          results of HMS beginning October 1, 2000. The assets acquired and the
          liabilities assumed were recorded at estimated fair values as
          determined by the Company's management based on information currently
          available and on current assumptions as to

                                       25
<PAGE>

          future operations. Goodwill is being amortized over fifteen years and
          all of it is expected to be deductible for tax purposes. A summary of
          the estimated fair values of assets acquired and liabilities assumed
          in the acquisition follows:

                  Current assets                                 $   4,584,749
                  Property and equipment                               192,815
                  Other                                                 21,997
                  Goodwill                                           3,695,942
                                                                 -------------
                    Total assets                                     8,495,503
                                                                 -------------
                  Liabilities assumed                               (1,448,003)
                                                                 -------------
                  Purchase price (net assets acquired)               7,047,500
                  Less cash acquired                                (1,729,628)
                  Less convertible promissory notes                 (2,500,000)
                                                                 -------------
                  Net cash paid                                  $   2,817,872
                                                                 =============

          Unaudited pro forma results of operations for the years ended July 31,
          2001 and 2000, as if the Company and HMS had been combined as of the
          beginning of the periods, follow. The pro forma results include
          estimates and assumptions which management believes are reasonable.
          However, pro forma results are not necessarily indicative of the
          results that would have occurred if the business combination had been
          in effect on the dates indicated, or which may result in the future.
<TABLE>
<CAPTION>

                                                                                    Pro forma
                                                                               Year ended July 31,
                                                                      (Thousands except for per share data)
                                                                                2001              2000
<S>                                                                     <C>                  <C>

                  Net sales                                                  $    14,153       $     16,199
                  Net income                                                 $       144       $        492
                  Net income per common share
                    Assuming dilution                                        $    .001         $  .006
                    Basic                                                    $    .001         $  .006
</TABLE>

          The Company acquired the assets and business known as Native Trade for
          $105,000 in cash effective September 1, 2000. The payment was
          allocated to inventory in the amount of $68,719, furniture and
          fixtures in the amount of $10,000 and goodwill in the amount of
          $26,281, which is being amortized over 15 years.

                                       26
<PAGE>


3.       MARKETABLE INVESTMENT SECURITIES

         The following summarizes the Company's investment in securities at July
         31, 2001:

                  Trading securities:
                           Cost                                 $     417,027
                           Unrealized gain                            239,973
                                                                -------------
                             Fair value                         $     657,000
                                                                =============
                  Available-for-sale securities:
                           Cost                                 $     429,550
                           Unrealized gain                                  -
                                                                -------------
                             Fair value                         $     429,550
                                                                =============

          During fiscal 2001 the Company included in earnings $239,973 in
          unrealized gains. The Company did not sell any of their marketable
          investment securities during fiscal 2001, accordingly, no realized
          gains were recognized.

          On July 20, 2001, the Company completed the acquisition of 355,000
          shares of the common stock of Premier Concepts, Inc. ("Premier") in
          exchange for 965,000 shares of its common stock. The Company used the
          July 31, 2001 closing market price as quoted on the Nasdaq Stock
          Market to value the transaction.

          The shares of common stock of Premier are "restricted securities"
          under Rule 144. The Company's investment represents 16.2% of the
          outstanding stock of Premier and accordingly the Company is subject to
          certain restrictions on the number of shares it can sell and its
          required holding period. The Company has classified its investment in
          Premier as available-for-sale securities as a result of the Company's
          intention to hold the securities indefinitely pursuant to SFAS No.
          115, "Accounting for Certain Investments in Debt and Equity
          Securities."

          Unrealized gains and losses based on fluctuations in the market value
          of available-for-sale securities are included in other comprehensive
          income as an adjustment to equity. The Company did not record any
          unrealized gain or loss since they valued the transaction using the
          last closing price for July 2001.

          Due to the limited market for Premier common stock, it is likely that
          only limited quantities of the stock will be able to be sold in the
          open market after the required holding period. As a result of these
          restrictions and the probable limited trading volume the Company
          believes the fair value of the investment is less than the recorded
          value required by SFAS No. 115 and that there can be no assurance the
          Company will realized the recorded value of its investment in Premier.


                                       27
<PAGE>

4.        INVENTORIES

          Inventories at July 31, 2001 consist of:

                  Gold jewelry                              $        3,961,804
                  Silver jewelry and other                           1,781,979
                                                            ------------------
                    Total                                            5,743,783
                  Less consigned gold                               (2,725,741)
                                                            ------------------
                    Net inventories                         $        3,018,042
                                                            ==================

          At July 31, 2001, inventories excluded 10,251 ounces of gold on
          consignment.


5.       NOTE RECEIVABLE

          The Company made a loan in the amount of $500,000 to a company which
          is due February 20, 2002. The Company received marketable securities
          with a value of $83,440 to prepay the interest for the one year loan
          period. Accrued expenses include the balance of unearned interest
          income in the amount of $31,295.


6.       PROPERTY AND EQUIPMENT

          Property and equipment consist of the following at July 31, 2001:

                  Office and computer equipment                 $   167,922
                  Transportation equipment                          168,038
                  Furniture and fixtures                            110,026
                  Software                                          105,669
                  Web site                                           37,225
                  Leasehold improvements                             18,860
                                                                 ----------
                                                                    607,740
                  Less accumulated depreciation                    (133,483)
                                                                 ----------
                                                                $   474,257
                                                                 ==========

                                       28
<PAGE>

7.       LONG-TERM DEBT AND NOTES PAYABLE

         Notes payable consists of the following:

<TABLE>
<S>                                                                                             <C>
                  Note payable to bank with interest at 9% payable on demand or
                  January 1, 2002 if no demand is made; accrued interest payable
                  monthly; collateralized by all assets of Silver and guaranteed
                  by the principal shareholder of the Company                                     $128,525

                  Note payable to company for  financed  insurance  payable in
                  monthly  installments of $3,030 through October 2001                               8,936

                  Notes payable to companies in monthly installments aggregating
                  $2,891, including interest ranging from 10.46% to 13.38%
                  through January 2005; collateralized by transportation
                  equipment                                                                        115,215
                                                                                                 ---------
                                                                                                   252,676

                  Current installments of long-term debt and notes payable                         182,534
                                                                                                 ---------

                  Long-term debt less current installments                                     $    70,142
                                                                                                 =========


         The aggregate maturities of long-term debt for the periods ending July
         31, 2005 are as follows: 2002 $182,534, 2003 - $17,895, 2004 - $49,335
         and 2005 - $2,912.


8.       NOTES PAYABLE DUE RELATED PARTIES

         Long-term debt and notes payable due related parties consists of the
         following at July 31, 2001:

                  Notes payable to the president of HMS, due $1,250,000 on
                  October 15, 2001 and $1,250,000 on October 15, 2002, with
                  interest payable monthly at 8%, collateralized by the stock of
                  HMS                                                                          $ 2,500,000

                  Note payable to the president of HMS, due on February 15, 2002
                  with interest payable monthly at the Paine Webber margin
                  interest rate                                                                     55,153

                                       29
</TABLE>
<PAGE>
<TABLE>
<S>                                                                                        <C>


                  Note payable to the brother of the principal shareholder of
                  the Company; due on demand with interest at 8%; unsecured;
                  convertible into common stock of the Company at $.01 per share                    50,000
                                                                                                 ---------
                  Total                                                                          2,605,153
                                                                                                 ---------
                  Current installments due related parties                                       1,355,153
                                                                                                 ---------
                  Non-current debt due related parties                                         $ 1,250,000
                                                                                                 =========
</TABLE>

          The aggregate maturities of long-term debt due related parties for the
          periods ending July 31, 2003 are as follows: 2002 - $1,355,153 and
          2003 - $1,250,000.


9.       GOLD CONSIGNMENT AND LINE OF CREDIT AGREEMENTS

          HMS has a gold consignment agreement with a gold lender. Under the
          terms of the agreement, HMS is entitled to lease the lesser of an
          aggregate amount of 13,200 ounces, or an aggregate consigned gold
          value not to exceed $3,450,000. Title to such consigned gold remains
          with the gold lender until HMS purchases the gold. However, during the
          period of consignment, the entire risk of loss, damage or destruction
          of the gold is borne by HMS. The purchase price per ounce is based on
          the daily Second London Gold Fix. HMS pays the gold consignor a
          consignment fee based upon the dollar value of gold ounces
          outstanding, as defined in the agreement. At July 31, 2001, HMS had
          10,251 ounces of gold on consignment with a market value of
          $2,725,741. Of this amount, 4,000 ounces was on a three month
          contract, valued at $270.60 per ounce and charged 4.65%; 4,000 ounces
          was on a six month contract, valued at $269.50 per ounce and charged
          4.8%; and the remainder was valued at the daily Second London Gold
          Fix, $265.90 per ounce at July 31, 2001, and charged 5.75%.

          The consignment agreement is terminable by the gold lender upon 60
          days notice. If the gold lender were to terminate its existing gold
          consignment agreement, HMS does not believe it would experience an
          interruption of its gold supply that would materially adversely affect
          its business. HMS believes that other consignors would be willing to
          enter into similar arrangements should its gold lender terminate its
          relationship with the company.

          The consignment agreement contains certain restrictive covenants
          relating to maximum usage, net worth, working capital, and other
          financial ratios, and the agreement requires HMS to own a specific
          amount of gold at all times. At July 31, 2001, HMS was in compliance
          with all of the covenants in the consignment agreement.

          Consigned gold is not included in inventory, and there is no related
          liability recorded. As a result of these consignment arrangements, HMS
          is able to shift a substantial portion of the risk of market
          fluctuations in the price of gold to the gold lender, since HMS does
          not purchase gold from the gold lender until receipt of a purchase
          order from, or shipment of jewelry to, its customers.

          The gold lender has also provided a line of credit to HMS in the
          amount of $1,500,000 that is due on demand, including interest at the
          lender's prime rate plus 3/4%. HMS does not have any advances on this
          line of credit at July 31, 2001.


                                       30
<PAGE>

          Payment for the consigned gold and the line of credit is secured by
          substantially all property of HMS including its cash, accounts
          receivable, inventory and equipment and the corporate guarantee of
          SGD.


10.      INCOME TAXES

          Income tax benefit for the years ended July 31, 2001 and 2000 consists
          of:
<TABLE>

                                                                            2001             2000
<S>                                                                  <C>               <C>

          Current                                                     $           -     $          -
          Deferred                                                             3,423           26,456
                                                                      --------------    -------------
            Total                                                     $        3,423    $      26,456
                                                                      ==============    =============

         Actual income tax expense (benefit) applicable to earnings (loss)
         before income taxes is reconciled with the "normally expected" federal
         income tax expense (benefit) for the two years ended July 31, 2001 as
         follows:

                                                                           2001              2000

          Normally expected income tax expense (benefit)               $      38,922    $     (81,978)
          Deferred tax asset valuation allowance                             (54,000)          54,000
          Non-deductible items and other                                      11,655            1,522
                                                                       -------------    -------------
                                                                       $      (3,423)   $     (26,456)
                                                                       =============    =============

          The deferred income tax assets and liabilities at July 31, 2001 are
          comprised of the following:
                                                                             Current        Noncurrent

          Allowance for bad debts and returns                              $  25,600          $      -
          Net operating loss carryforwards                                   119,100                -
          Marketable securities allowance                                    (81,600)               -
                                                                        ------------     -------------
          Deferred income tax asset                                           63,100                -

          Deferred income tax liability - asset basis                              -           ( 9,200)
                                                                        ------------     -------------
              Net deferred income tax assets (liabilities)                  $ 63,100          $ (9,200)
                                                                        ============     =============
</TABLE>

          The Company has available net operating loss carryforwards in the
          amount of $350,000, of which $35,000 will expire in fiscal 2020 and
          $315,000 will expire in fiscal 2021.



                                       31
<PAGE>



11.      RELATED PARTY TRANSACTIONS

          Silver leases its corporate headquarters from the principal
          shareholder of the Company at the rate of $2,200 per month. This
          amounted to $26,400 during each of the years ended July 31, 2001 and
          2000.

          HMS leases its facility from HMS Leasing Company, LLC, at the rate of
          $8,075 per month pursuant to a lease agreement that expires on October
          31, 2010. This amounted to $80,750 during fiscal 2001, which includes
          the ten months during which HMS was owned by the Company. HMS Leasing
          Company, LLC is owned by the president of HMS.

          The Company had received loans from its principal shareholder. The
          balance owed was $3,386 at July 31, 2001. At July 31, 2001, the
          Company had made net advances to the president of HMS, including
          companies owned by him, of $9,309. See Note 8 for details of note
          obligations to related parties.


12.      CAPITAL STOCK

                                  Common stock

          The Company has 200,000,000 shares of common stock (par value $.0001)
          authorized and 96,134,408 shares issued and outstanding at July 31,
          2001.

          During fiscal 1999, the Company sold 200,000 units (The "Units") at
          $1.00 per Unit. Each Unit consisted of 4 shares of common stock and 1
          warrant. Each warrant entitled the holder to purchase eight shares of
          the common stock of the Company at a purchase price of $.50 per share.
          During fiscal 2000, all warrants were exercised and 1,600,000 shares
          were issued for $800,000 in cash.

          During fiscal 2000, in addition to the warrants exercised, the Company
          sold 5,080,000 shares of its common stock for proceeds, net of
          investment fees paid, of $5,977,500.

          On April 20, 2000, pursuant to an agreement and plan of reorganization
          dated April 11, 2000, SGD acquired 100% of the issued and outstanding
          common stock of Benton in exchange for 1,200,000 newly issued common
          shares of SGD. This transaction was completed to facilitate the
          Company becoming a reporting company pursuant to requirements
          implemented by the Nasdaq Stock Market.



                                       32
<PAGE>



          During fiscal 2001, the Company sold 1,100,000 shares of its common
          stock for proceeds, net of investment fees paid, of $1,567,500. In
          addition, the Company issued 50,000 shares of its common stock as
          partial consideration for a five year marketing agreement. The shares
          were recorded at $1.75 per share, the closing price reported by the
          OTC: Bulletin Board on the date of the agreement.

                                Stock option plan

          On September 1, 1999, the Board of Directors approved the Goldonline
          International, Inc. Stock Option Plan (the "Plan"), which was approved
          by a majority of the shareholders at a meeting on the same date. The
          Company has reserved 10,000,000 shares of common stock for the grant
          of qualified incentive options or non-qualified options to employees
          and directors of the Company and to non-employee directors,
          consultants and advisors and other persons who may perform significant
          services for or on behalf of the Company. Prices for incentive stock
          options must provide for an exercise price of not less than 100% of
          the fair market value of the common stock on the date the options are
          granted unless the eligible employee owns more than 10% of the
          Company's common stock for which the exercise price must be at least
          110% of such fair market value. Non-statutory options must provide for
          an exercise price of not less than 85% of the fair market value.

         During fiscal 2000 and pursuant to the Plan, the Board of Directors of
          the Company granted 58,000 non-qualified stock options and 50,000
          incentive stock options to certain consultants and an employee. The
          58,000 shares were issued for services valued at $18,124 and the
          50,000 shares were issued for $1,700 in cash.

         On June 1, 2001, and pursuant to the Plan, the Board of Directors of
          the Company granted options to each member of the Board of Directors
          with an exercise price of $1.00 per share. The options expire on June
          1, 2002. The following is a summary of option activity for the two
          years ended July 31, 2001:
<TABLE>
<CAPTION>
                                                                                  Options Outstanding
                                                                                -------------------------
                                                                                                 Weighted
                                                           Options                                Average
                                                          Available                              Exercise
                                                          for Grant             Options            Price
                                                         -----------            -------          ---------
<S>                                                   <C>                   <C>                <C>

         Balance, August 1, 1999                                  -                   -           $ -
         Plan established                                 10,000,000                  -             -
         Granted                                            (108,000)            108,000              .18
         Exercised                                                -             (108,000)             .18
                                                          ----------            --------
         Balance, July 31, 2000                            9,892,000                   -
                                                          ----------            --------
         Granted                                            (400,000)            400,000             1.00
         Exercised                                                 -                   -                -
                                                          ----------            --------           -------
            Balance, July 31, 2001                         9,492,000             400,000           $  1.00
                                                          ==========            ========           =======




                                       33
</TABLE>
<PAGE>


          SFAS No. 123 "Accounting for Stock Based Compensation" ("SFAS 123"),
          requires the Company to disclose pro forma information regarding
          option grants made to its employees. SFAS 123 specifies certain
          valuation techniques that produce estimated compensation charges that
          are included in the pro forma results below. These amounts have not
          been reflected in the Company's Statement of Operations, because
          Accounting Principles Board Opinion 25, "Accounting for Stock Issued
          to Employees," specifies that no compensation charge arises when the
          price of the employees' stock options equal the market value of the
          underlying stock at the grant date, as in the case of options granted
          to the Company's employees and consultants. Stock options are
          anti-dilutive for both fiscal 2001 and fiscal 2000 and accordingly are
          not included in the earnings per share calculation.

          SFAS No. 123 pro forma numbers are as follows for the years ended
          July 31, 2001 and 2000:
<TABLE>
<CAPTION>

                                                                                2001           2000

<S>                                                                       <C>               <C>

                  Actual net earnings (loss)                               $     117,900     $    (214,657)
                                                                           =============     =============
                  Pro forma net earnings (loss)                            $     102,700     $    (214,657)
                                                                           =============     =============
                  Pro forma basic and diluted net
                      earnings (loss) per share                            $      .001       $     (.002)
                                                                           =============     =============

</TABLE>
          Under SFAS 123, the fair value of each option grant is estimated on
          the date of grant using the Black-Scholes option-pricing model. At
          July 31, 2001, the following weighted average assumptions were used:
          risk-free interest rate of 6%, no expected dividends, a volatility
          factor of 98.89%, and a weighted average expected life of the options
          of one year.

          The Black-Scholes option valuation model was developed for use in
          estimating the fair value of traded options that have no vesting
          restrictions and are fully transferable. In addition, option valuation
          models require the input of highly subjective assumptions including
          the expected stock price volatility. Because the Company's employee
          stock options have characteristics significantly different from those
          of traded options, and because changes in the subjective input
          assumptions can materially affect the fair value estimate, in
          management's opinion the existing models do not necessarily provide a
          reliable single measure of the fair value of the Company's options.


13.      COMMITMENTS

          During fiscal 2001, the Company acquired HMS and increased their
          retail operations from two to four locations. Rent expense amounted to
          $373,887 during fiscal 2001 and $124,062 during fiscal 2000. Minimum
          rental commitments under all non-cancelable leases with an initial
          term in excess of one year are payable as follows: 2002 - $299,100,
          2003 - $214,400, 2004 - $112,400, 2005 - $96,900, 2006 - $96,900 and
          thereafter - $452,200.



                                       34
<PAGE>




14.      SEGMENT INFORMATION

          The Company reports segments based upon the management approach, which
          designates the internal reporting that is used by management for
          making operating decisions and assessing performance. For the year
          ended July 31, 2001, the first year in which the Company operated in
          more than one segment, the Company operated in the following segments
          (In Thousands):
<TABLE>
<CAPTION>

                                                                    Silver
                                                    Gold           and other        Corporate       Consolidated
<S>                                         <C>               <C>              <C>               <C>

         Revenues:
           External customers                 $        9,755    $       2,495     $           -    $     12,250
                                              ==============    =============     =============    ============
           Intersegment                       $           70    $           -     $           -    $         70
                                              ==============    =============     =============    ============

         Earnings (loss) from
           operations                         $          467    $        (461)    $         (30)   $        (24)
         Interest and other income                        12                9               215             235
         Interest expense                               (134)             (31)             (172)           (337)
         Unrealized gain on
           marketable securities                           -                -               240             240
                                              ==============    =============     =============    ============
         Net earnings (loss)                  $          224    $        (272)    $         166    $        118
                                              ==============    =============     =============    ============

         Assets                              $         7,550   $        2,324    $        2,555  $       12,429
                                             ===============   ==============    ==============  ==============
</TABLE>

          The Gold segment represents the operations of HMS, who is a national
          jewelry wholesaler selling predominately gold jewelry to a network of
          over 30,000 retail jewelers through a catalog and telephone ordering
          system and through its online catalog.

          The Silver and Other segment represents the operations of Silver and
          includes both its wholesale and retail operations. This segment's
          sales are principally silver.

          Corporate assets consist primarily of cash, marketable securities and
          notes receivable.


15.      SUBSEQUENT EVENT

         On October 15, 2001, the Company's obligation to the president of HMS
          in the amount of $1,250,000 became due. The Company received a loan
          from a related party in the amount of $675,000, paid $625,000 to the
          president of HMS and executed a new note for $625,000 with the same
          terms as the original note and due on April 15, 2002.


                                       35
<PAGE>




ITEM 8.           CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
                  AND FINANCIAL DISCLOSURE

None.


ITEM 9.           DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS,
                  COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT DIRECTORS,
                  EXECUTIVE OFFICERS AND SIGNIFICANT EMPLOYEES

The following table sets forth the names, ages and current positions with the
Company held by the Directors, Executive Officers and Significant Employees,
together with the year such positions were assumed. There is no immediate family
relationship between or among any of the Directors, Executive Officers or
Significant Employees, and the Company is not aware of any arrangement or
understanding between any Director or Executive Officer and any other person
pursuant to which he was elected to his current position.

                                 POSITION OR OFFICE                 DATE FIRST
NAME                AGE           WITH THE COMPANY                   ELECTED/
                                                                    APPOINTED

James G. Gordon     33            President, Director                1999
Dr. Terry Washburn  47            Director                           2000
William E. Dark     68            Director                           2001
Mitch Horowitz      40            Director                           2001
Harry M. Schmidt    56            President, HMS Jewelry             2000

JAMES G. GORDON is the  President  and a Director  of SGD since  1999.  Prior to
starting the Company,  Mr.  Gordon was founder and  President of Con-Tex  Silver
Imports,  Inc.,  a  wholesale  and  retail  jewelry  operation  from 1994 to the
present. Mr. Gordon received a Bachelor of Science Degree from the University of
Arkansas in 1990 and has been involved in the jewelry  wholesale  business since
1990. Mr. Gordon has also been a Certified Gemologist since 1990.

DR. TERRY WASHBURN became a Director during fiscal 2000 and is the President of
Eurovest, Inc., ("Eurovest") a private venture capital firm. Eurovest
specializes in private placement of capital as well as providing consulting
services in strategic planning, business development and organizational
management. As the President of Eurovest, he is responsible for screening and
analyzing prospective investment candidates for final recommendations to
investors and/or Boards of Directors. Dr. Washburn served eight years as a Board
member of a private pension fund during which he served on the investment
advisory subcommittee that successfully directed the firm's asset base, which
reached 3 billion dollars. Dr. Washburn earned a Bachelor of Business



                                       36
<PAGE>


Administration from the University of Oklahoma, a Master of Divinity from the
Southwestern Baptist Theological Seminary in Ft. Worth, Texas and a Doctor of
Ministry from the Fuller Theological Seminary in Pasadena, California. He has
extensive background in accounting, marketing, strategic planning and leadership
development.

WILLIAM E. DARK  became a director  of the  Company in March  2001.  Mr. Dark is
currently President and principal shareholder of White Oak Development,  Inc., a
general  contractor  principally  involved  in  manufactured  home  development,
including   management  of   approximately   850  mortgage   accounts  of  which
approximately  75%  belong  to  the  Company.  Mr.  Dark  previously  served  as
Vice-President  Finance and Senior Vice-President in charge of Funds Management,
as well as, a Director of Swift Energy Company. He also served as Vice-President
of Underwood,  Neuhaus & Co., Inc., a New York Stock  Exchange  member firm. Mr.
Dark  received  his  Bachelor of Science  degree in  Engineering  from Texas A&M
University.

MITCH HOROWITZ  became a director of the Company in April 2001. Mr.  Horowitz is
the Associate Publisher of the "National Jeweler" magazine,  by whom he has been
employed since 1993, and is currently  responsible for all sales  activities for
the  magazine.  For the ten years prior to 1993,  Mr.  Horowitz  was employed by
Vance  Publishing  Corp.  Mr.  Horowitz  has 18  years of  sales  and  marketing
experience in the jewelry industry. Mr. Horowitz earned his Bachelor's Degree at
the University of Buffalo.

HARRY M. SCHMIDT is President of HMS Jewelry Company, Inc. since its acquisition
by SGD in October  2000.  From 1983 through  October 2000,  Mr.  Schmidt was the
principal  owner and chief  operating  officer for HMS Jewelry  Co., Ltd and HMS
Operating  Company,  the predecessors to HMS Jewelry Company,  Inc. From 1978 to
1983,  Mr.  Schmidt  was Vice  President  of The  Leverett  Company,  a  jewelry
wholesaler.

COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

During fiscal 2001, Mr. Dark and Mr. Horowitz failed to file Form 3 when they
were elected to serve as directors of the Company. All directors failed to file
Form 4 when they were granted options. All directors have filed Form 5 to report
all necessary transactions and activity.


ITEM 10.          EXECUTIVE COMPENSATION

The following table shows the cash compensation of the Company's chief executive
officer and each officer whose total cash compensation exceeded $100,000, for
the three fiscal years ended July 31, 2001. The Company has no long-term
compensation plans.


                                       37
<PAGE>
<TABLE>
<CAPTION>

                           SUMMARY COMPENSATION TABLE

NAME AND                   FISCAL                                                  OTHER                  ALL
PRINCIPAL                  YEAR                                                    ANNUAL                OTHER
POSITION                   ENDED               SALARY       BONUS              COMPENSATION         COMPENSATION
<S>                      <C>                <C>          <C>                  <C>                  <C>

James G. Gordon            07/31/01          $102,000          -                         -                    -
(CEO)                      07/31/00           $72,000          -                         -                    -
                           07/31/99           $72,000          -                         -                    -
</TABLE>

The Company makes available certain non-monetary benefits to its executive
officers with a view to acquiring and retaining qualified personnel and
facilitating job performance. The Company considers such benefits to be ordinary
and incidental business costs and expenses. The value of such benefits did not
exceed, in the case of any named individual, 10% of the cash compensation of the
individual.

On September 1, 1999, the Company established a stock option plan, which
reserved 10,000,000 shares of the Company's common stock for issue to certain
employees, directors and consultants. The Plan provides that options may be
granted for no less than fair market value at the date of the option grant.
During fiscal 2000, options to acquire 108,000 common shares were granted and
exercised. During fiscal 2001, options to acquire 100,000 shares at $1.00 per
share for one year were granted to each of the four directors. The directors did
not receive any additional compensation for their service as a director. There
were no long-term incentive plan awards during the fiscal year.
<TABLE>
<CAPTION>

                                          Option/SAR Grants in Last Fiscal Year

                                      Number of       Percent of Total
                                     Securities         options/SARs
                                     Underlying          granted to           Exercise
      Name                          Options/SARs        employees in           or base          Expiration
<S>                                <C>                <C>                   <C>                <C>

James G. Gordon                        100,000               25%                $1.00             6/1/02
</TABLE>
<TABLE>
<CAPTION>

                       Aggregated Options/SAR Exercises in Last Fiscal Year and FY-end Option/SAR Values

                                                                 No. of securities    Value of unexer-
                                                                    Underlying          cised in-the
                                                                    Unexercised        money Options/
                                Shares                             Options/SARs            SARs at
                               Acquired                            At FY-end (#)         FY-end ($)
                                  On                Value          Exercisable/         Exercisable/
                             Exercise (#)       Realized ($)       Unexercisable        Unexercisable
<S>                        <C>                  <C>                <C>                  <C>

James G. Gordon                    0                  0              * 100,000               N/A

* Exercisable



                                       38
</TABLE>
<PAGE>


ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table indicates all persons who, as of September 30, 2001, the
most recent practicable date, are known by the Company to own beneficially more
than 5% of any class of the Company's voting securities and all Directors of the
Company and all Officers who are not Directors of the Company, as a group. As of
September 30, 2001, there were 97,099,408 shares of the Company's common stock
outstanding.
<TABLE>
<CAPTION>


TITLE                      NAME AND ADDRESS                             AMOUNT AND NATURE
OF                           OF BENEFICIAL                                OF BENEFICIAL                   % OF
CLASS                            OWNER                                        OWNER                      CLASS
<S>                                                                   <C>                               <C>

Common              James G. Gordon                                           67,600,000                    69.5%
                    President, Director
                    111 Rhodes
                    Conroe, TX  77301

Common              Evolve One, Inc.                                          10,200,000                    10.5%
                    6413 Congress Ave, Ste 240
                    Boca Raton, FL 33487

Common              Dr. Terry Washburn                                           100,000                     *
                    1701 West N.W. Highway
                    Grapevine, TX  76051

Common              William E. Dark                                              100,000                     *
                    19221 IH 45 South, Ste 370
                    Conroe, TX  77385

Common              Mitch Horowitz                                               100,000                     *
                    1199 S. Bell Line Rd, Ste 100
                    Coppell, TX  75019


Common              All directors and executive                               67,900,000                   69.6%
                    officers as a group (four persons)

* Less than 1%.
</TABLE>

Shares listed for each of the four directors include options to acquire 100,000
shares at $1.00 per share until June 1, 2002.



                                       39
<PAGE>




ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANACTIONS

Silver leases its corporate headquarters and warehouse facility pursuant to a
month-to-month agreement with the principal shareholder of the Company at the
rate of $2,200 per month. This amounted to $26,400 during each of the years
ended July 31, 2001 and 2000.

HMS leases its facility from HMS Leasing Company, LLC, at the rate of $8,075
pursuant to a lease agreement that expires on October 31, 2010. This amounted to
$80,750 during fiscal 2001, which includes the ten months during which HMS was
owned by the Company. HMS Leasing Company, LLC is owned by the president of HMS.

The Company had received loans from its principal shareholder. The balance owed
was $3,386 at July 31, 2001. At July 31, 2001, HMS had made net advances to the
president of HMS, including the companies owned by him, of $9,309.

The Company has notes payable to related parties at July 31, 2001 in the total
amount of $2,605,153, as more particularly described in Note 8 to the
consolidated financial statements.





                                       40
<PAGE>


ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K

(A)      EXHIBITS - See Exhibit Index at Page 42

(B)      NONE



                                   SIGNATURES

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

                                 SGD HOLDINGS, LTD.



Date:  November 9, 2001          By:  /s/ James G. Gordon
                                      -------------------
                                      James G. Gordon
                                      President and Principal
                                      Financial and Accounting Officer

In accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the Registrant and in the capacities and on the
dates indicated.


Date:  November 9, 2001         By:  /s/ James G. Gordon
                                     -------------------
                                     James G. Gordon
                                     Director

Date:  November 9, 2001         By:  /s/ Dr. Terry Washburn
                                     ----------------------
                                     Dr. Terry Washburn
                                     Director

Date:  November 9, 2001         By:  /s/ William E. Dark
                                     -------------------
                                     William E. Dark
                                     Director

Date:  November 9, 2001         By:  /s/ Mitch Horowitz
                                     ------------------
                                     Mitch Horowitz
                                     Director




                                       41
<PAGE>


OBTAINED FROM SGD HOLDINGS, LTD. (FORMERLY GOLDONLINE INTERNATIONAL,  INC.) (THE
"COMPANY")  UPON REQUEST AND PAYMENT OF THE COMPANY'S  COSTS IN FURNISHING  SUCH
COPIES.  COPIES MAY ALSO BE OBTAINED FROM THE SECURITIES AND EXCHANGE COMMISSION
FOR A SLIGHT CHARGE.
                     (The foregoing is not applicable to the
                              original(s) hereof.)
<TABLE>
<CAPTION>

                                  EXHIBIT INDEX
Securities and
Exchange
Commission                                                                                              Page
Exhibit No.           Type of Exhibit                                                                  Number
<S>                                                                                                 <C>

2                     Plan of acquisition, reorganization, arrangement,                                  N/A
                      liquidation, or succession

3(i)                  Articles of incorporation                                                          N/A

3(ii)                 By-laws                                                                            N/A

4                     Instruments defining the rights of holders, incl. Indentures                       N/A

9                     Voting trust agreement                                                             N/A

10                    Material contracts                                                                 N/A

11                    Statement re: computation of per share earnings                                  Item 7

16                    Letter on change in certifying accountant                                          N/A

18                    Letter on change in accounting principles                                          N/A

21                    Subsidiaries of the Registrant                                                   Item 1

22                    Published report regarding matters submitted to vote                               N/A

23                    Consent of experts and counsel                                                     N/A

24                    Power of Attorney                                                                  N/A

99                    Additional exhibits                                                                N/A



                                       42
</TABLE>
<PAGE>