SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB


         [X]  QUARTERLY REPORT PURSUANT TO SECTON 13 OR 15(d) OF THE SECURITIES
              EXCHANGE ACT OF 1934

         For the quarterly period ended June 30, 2000

         [ ]  TRANSITIONAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
              EXCHANGE ACT OF 1934 (No Fee Required)

                           Commission File No. 0-27210


                          Tech Electro Industries, Inc.
              ----------------------------------------------------
                 (Name of Small Business Issuer in its Charter)


              Texas                                             75-2408297
      -------------------------------                 --------------------------
      (State or other jurisdiction of                        (I.R.S. Employer
        incorporation of organization)                    Identification No.)

           275 N Franklin Turnpike, Ste 230, Ramsey, New Jersey 07446
        ----------------------------------------------------------------
                     (Address of principal executive office


                                 (201) 760-9900
                          ----------------------------
                           (Issuer's telephone number)

     Check  whether the issuer has (1) filed all reports  required by Section 12
or 15(d) of the Exchange  Act during the past 12 months,  and 2) been subject to
such filing requirements for the past ninety (90) days. Yes [ X ] No [ ]

     As of June 30, 2000, 8,118,815 shares of Common Stock were outstanding.















                                       1
<PAGE>




                                      INDEX



                                                                      Page
PART I - Financial Information

Item 1.  Financial Statements

   Consolidated Balance Sheets at June 30, 2000 (unaudited)
   and December 31, 1999................................................3

   Consolidated Statements of Operations for the periods
   ended June 30, 2000 and 1999 (unaudited).............................5

   Consolidated Statements of Cash Flows for the periods
   ended June 30, 2000 and 1999 (unaudited).............................7

   Notes to Consolidated Financial Statements...........................9

Item 2.  Management's Discussion and Analysis or Plan of Operation.....13

PART II - Other Information............................................18

   Item 1.  Legal Proceedings..........................................18

   Item 2.  Changes in Securities......................................19

   Item 3.  Defaults Upon Senior Securities............................19

   Item 4.  Submission of Matters to a Vote of Securities Holders......19

   Item 5.  Other Information..........................................19

   Item 6.  Exhibits and Reports on Form 8-K...........................19

Signature..............................................................19

















                                       2
<PAGE>
PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

                 TECH ELECTRO INDUSTRIES, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS

                                     ASSETS
                                                  (Unaudited)
                                                 June 30, 2000     Dec 31, 1999
                                                 -------------    -------------
CURRENT ASSETS
     Cash and cash equivalents....................$    847,633     $   894,261
     Certificate of deposit.......................     265,586         260,294
     Accounts and notes receivable
        Trade, net of allowance for doubtful
        accounts of $266,328 and $282,498 in
        2000 and 1999, respectively...............   3,118,992       3,352,887
        Notes.....................................           -         180,146
        Other.....................................      26,945          67,901
     Inventories, net ............................   1,730,600       1,611,358
     Prepaid expenses and other current assets....     800,356         601,257
                                                   -----------      ----------

           Total current assets...................   6,790,112       6,968,104
                                                   -----------      ----------
PROPERTY AND EQUIPMENT
     Facsimile and business center equipment......   7,568,411       8,175,530
     Other equipment..............................   1,030,939         959,814
     Furniture and fixtures.......................     225,833         214,271
     Vehicles.....................................      45,262          14,262
     Leasehold improvements.......................      76,680          51,378
                                                   -----------      ----------
                                                     8,947,125       9,415,255
     Less accumulated depreciation and
        amortization..............................  (1,392,587)     (1,426,888)
                                                   -----------      ----------
           Net property and equipment.............   7,554,538       7,988,367
                                                   -----------      ----------

OTHER ASSETS
     Notes receivable, net of current portion.....      5,469            7,031
     Deferred financing costs, net................    540,907          688,875
     Other........................................     16,800           26,461
                                                   ----------       ----------
           Total other assets.....................    563,176          722,367
                                                   ----------       ----------
TOTAL ASSETS......................................$14,907,826      $15,678,838
                                                   ==========       ==========

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


                                  - Continued -


                                       3
<PAGE>
                 TECH ELECTRO INDUSTRIES, INC. AND SUBSIDIARIES
                     CONSOLIDATED BALANCE SHEETS - Continued


                      LIABILITIES AND STOCKHOLDERS' EQUITY

                                                    (Unaudited)
                                                  June 30, 2000    Dec 31, 1999
                                                  -------------    ------------
CURRENT LIABILITIES
     Line of credit...............................$  1,072,512     $   389,532
     Current portion of long-term debt............     597,058       2,316,796
     Current portion of Capital lease.............       2,940               -
     Trade accounts payable.......................   1,451,602       1,846,642
     Accrued liabilities..........................     837,252         948,687
     Other current liabilities....................      44,119          44,119
                                                    ----------      ----------
            Total current liabilities.............   4,005,483       5,545,776
                                                    ----------      ----------

LONG-TERM DEBT, less current portion..............   2,505,895       2,556,174
CAPITAL LEASE, less current portion...............      14,348               -
EXCESS OF NET ASSETS OF COMPANIES ACQUIRED
     OVER COST, NET...............................   3,772,930       4,033,132
                                                     ---------      ----------
            Total liabilities.....................  10,298,656      12,135,082

COMMITMENTS AND CONTINGENCIES (Note M)

STOCKHOLDERS' EQUITY
     Preferred stock - $1.00 par value; 1,000,000
        shares authorized; 119,588 Class A issued
       and outstanding; liquidation preference
        of $627,837 ..............................     119,588         119,588
     Common stock - $0.01 par value; 50,000,000
        shares authorized; 8,118,815 and 7,034,684
        shares issued and outstanding in 2000 and
        1999, respectively........................      81,188          70,347
     Additional paid-in capital...................  14,388,134      13,225,368
     Accumulated deficit..........................  (9,979,740)     (9,871,547)
                                                    ----------      ----------
            Total stockholders' equity............   4,609,170       3,543,756
                                                    ----------      ----------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY........$ 14,907,826     $15,678,838
                                                    ==========      ==========








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

                                       4
<PAGE>
                 TECH ELECTRO INDUSTRIES, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                  For the Periods Ended June 30, 2000 and 1999
                                   (Unaudited)
<TABLE>
<S>                                        <C>            <C>             <C>            <C>
                                            Three Months Ended June 30     Six Months Ended June 30
                                            --------------------------     ------------------------
                                               2000          1999             2000           1999
REVENUES                                       ----          ----             ----           ----
     Revenues                              $5,667,467     $2,526,774      $11,374,960    $ 4,944,415
     Service revenue                                -              -                -      2,775,147
                                            ---------      ---------       ----------      ---------
                                            5,667,467      2,526,774       11,374,960      7,719,562

COST OF REVENUES
     Cost of revenues                       3,490,688      1,982,475        6,786,751      4,430,486
     Direct servicing costs                         -              -                -      1,586,638
                                            ---------      ---------       ----------      ---------
                                            3,490,688      1,982,475        6,786,751      6,017,124
                                            ---------      ---------       ----------      ---------
GROSS PROFIT                                2,176,779        544,299        4,588,209      1,702,438

OPERATING EXPENSES
     Selling, general and administrative    1,953,255       539,160        3,814,699       2,927,659
     Inventory obsolescence provision           3,000        15,500            6,000         200,930
     Depreciation and amortization of
     property and equipment                   284,483        18,782          675,107         237,135
     Lawsuit settlement                            -              -          400,086               -
     Amortization of excess of net assets
        of companies acquired over cost      (130,101)            -         (260,202)              -
                                            ---------      --------        ---------       ---------
                                            2,110,637       573,442        4,635,690       3,365,724
                                            ---------      --------        ---------       ---------
INCOME (LOSS) FROM OPERATIONS                  66,142       (29,143)         (47,481)     (1,663,286)

OTHER INCOME (EXPENSES)
     Interest income                            3,753        18,297           11,721          31,993
     Interest expense                        (202,051)       (8,315)        (402,063)       (140,712)
     Amortization of deferred financing
        cost                                 (153,798)            -         (311,523)              -
     Other                                     63,695        28,260           96,207          51,399
                                            ---------      --------        ---------       ---------
                                             (288,401)       38,242         (605,658)        (57,320)
                                            ---------      --------        ---------       ---------
INCOME (LOSS) BEFORE PROVISION FOR
    INCOME TAXES AND EXTRAORDINARY GAIN      (222,259)        9,099         (653,139)     (1,720,606)

PROVISION FOR INCOME TAXES                          -             -                -               -
                                            ---------      --------        ---------       ---------
INCOME LOSS BEFORE EXTRAORDINARY GAIN        (222,259)        9,099         (653,139)     (1,720,606)

</TABLE>
              The accompanying notes are an integral part of these
                       consolidated financial statements.

                                   -Continued-

                                       5
<PAGE>
                 TECH ELECTRO INDUSTRIES, INC. AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF OPERATIONS - Continued
                  For the Periods Ended June 30, 2000 and 1999
                                   (Unaudited)

<TABLE>
<S>                                        <C>            <C>             <C>            <C>
                                            Three Months Ended June 30     Six Months Ended June 30
                                            --------------------------     ------------------------
                                               2000          1999             2000           1999
                                               ----          ----             ----           ----
EXTRAORDINARY GAIN                                  -             -          568,750               -
                                            ---------      --------        ---------       ---------
NET INCOME (LOSS)                          $ (222,259)    $   9,099       $  (84,389)    $(1,720,606)
                                            =========      ========        =========      ==========
Net income (loss) attributable to
     common stockholders                   $ (233,527)    $  (1,484)      $ (108,092)    $(1,749,172)
                                            ---------      --------        ---------      ----------
Basic and diluted net loss before
     extraordinary gain per share
     attributable to common shareholders   $    (0.03)            -       $    (0.08)    $     (0.36)
                                            ---------      --------        ---------      ----------
Basic and diluted extraordinary gain
     attributable to common shareholders            -             -       $     0.07               -
                                            =========    ==========        =========      ==========
Basic and diluted net loss
     per share attributable to common
     shareholders                          $    (0.03)            -       $    (0.01)    $     (0.36)
                                            =========    ==========        =========      ==========
Number of weighted-average shares of
     common stock outstanding (basic
     and diluted)                           7,694,004     4,936,514        7,904,323      4,872,439
                                            =========    ==========        ==========     ==========
</TABLE>



















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


                                       6
<PAGE>
                 TECH ELECTRO INDUSTRIES, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                  For The Periods Ended June 30, 2000 and 1999
                                   (Unaudited)
                                                        Six Month Ended
                                                       ------------------
                                                     June 30, 2000 June 30, 1999
CASH FLOWS FROM OPERATING ACTIVITIES                -------------- -------------
Net loss                                              $   (84,389)  $(1,720,606)
Adjustments to reconcile net loss to net
   cash provided by (used by) operating activities:
     Common stock issued for compensation...............  (45,000)       18,496
     Depreciation and amortization of property
        and equipment...................................  675,107       237,092
     Provision for bad debts............................  (16,170)      160,826
     Provision for obsolete inventory...................   (6,000)      105,142
     Amortization of deferred financing costs...........  311,521             -
     Loss on sale of property and equipment.............        -         2,170
     Extraordinary gain on note retirement ............. (568,750)            -
     Amortization of deferred financing costs...........  311,522        18,494
     Amortization of excess of net assets
        of companies acquired over cost................. (260,202)            -
     Change in operating assets and liabilities
           Accounts receivable - trade..................  250,065      (239,743)
           Accounts receivable - other..................   40,956       (39,897)
           Inventories.................................. (125,242)      629,868
           Prepaid expenses and other current assets.... (199,099)      (70,333)
           Other assets.................................    9,661         9,064
           Trade accounts payable....................... (395,040)      362,247
           Accrued liabilities.......................... (111,435)    1,112,095
           Deferred service liability...................        -      (199,163)
                                                       ----------    ----------
Net cash provided by (used by) operating activities..... (512,017)      385,752
                                                       ----------    ----------
CASH FLOWS FROM INVESTING ACTIVITIES
   Purchases of property and equipment.................. (300,021)      (21,287)
   Proceeds on sale of property and equipment...........   76,031        21,512
   Payments received on notes receivable................  101,562        39,557
   Write-off of notes receivable........................   80,146             -
   Advance to related party ............................        -      (222,397)
   Purchase of certificate of deposit...................   (5,292)            -
   Cash in de-consolidation of subsidiary...............        -      (316,262)
                                                       ----------    ----------
Net cash used by investing activities...................  (47,574)     (498,877)
                                                       ----------    ----------
CASH FLOWS FROM FINANCING ACTIVITIES
   Net activity on line of credit.......................  682,980      (750,827)
   Repayment of long-term debt.......................... (670,017)      (36,834)
   Proceeds from long-term debt.........................  500,000             -
   Cash received on shareholder receivable..............        -        25,000
                                                       ----------    ----------
Net cash provided by (used by) financing activities....   512,963      (762,661)
                                                       ----------    ----------

              The accompanying notes are an integral part of these
                       consolidated financial statements.
                                   -continued-
                                       7
<PAGE>
                 TECH ELECTRO INDUSTRIES, INC. AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF CASH FLOWS - Continued
                  For The Periods Ended June 30, 1999 and 2000
                                   (Unaudited)

                                                        Six Month Ended
                                                       ------------------
                                                     June 30, 2000 June 30, 1999
                                                    -------------- -------------
NET DECREASE IN CASH AND CASH EQUIVALENTS....             (46,628)     (875,786)

Cash and cash equivalents at beginning
     of period   ............................             894,261     1,399,060
                                                       ----------    ----------
Cash and cash equivalents at end of period.........   $   847,633   $   523,274
                                                       ==========    ==========
SUPPLEMENTAL SCHEDULE OF NONCASH
     INVESTING AND FINANCING ACTIVITIES

     Issuance of common stock for
        settlement of note payable.................   $ 1,031,250   $         -
                                                       ==========    ==========
     Dividends paid through issuance
        of common stock............................   $    23,703   $    36,111
                                                       ==========    ==========
     Issuance of common stock for
        deferred financing costs                      $   163,553   $         -
                                                       ==========    ==========

     Acquisition of property and equipment
        Through a capital lease                       $    17,288   $         -
                                                       ==========    ==========






















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

                                       8
<PAGE>
                 TECH ELECTRO INDUSTRIES, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE A - BASIS OF PRESENTATION

     The  accompanying  unaudited  financial  statements  have been  prepared in
accordance with generally accepted  accounting  principles for interim financial
information  and  in  accordance  with  the  instructions  per  Item  310(b)  of
Regulation  SB.  Accordingly,  they do not  include all of the  information  and
footnotes  required by generally  accepted  accounting  principles  for complete
financial statements.

     In the  opinion  of  management,  all  adjustments  (consisting  of  normal
recurring  adjustments)  considered  necessary for a fair presentation have been
included. Operating results for the six month period ended June 30, 2000 are not
necessarily  indicative  of the results  that may be expected for the year ended
December 31, 2000.

NOTE B - ORGANIZATION

     Tech Electro  Industries,  Inc. ("TEI") was formed on January 10, 1992 as a
Texas   corporation.    TEI's   subsidiary,    Universal   Battery   Corporation
("UBC")formerly  Computer  Components  Corporation  ("CCC"),  stocks  and  sells
electronic components and batteries. Within the battery sales activity, there is
significant  value added to the  batteries  in the  assembly of  batteries  into
"packs". UBC's electronic components sales are generated by in-house sales staff
and sales  representatives as well as over the Internet to customers  throughout
the United States.

     On October 22, 1999, TEI acquired 100% of the  outstanding  common stock of
AlphaNet Hospitality Systems, Inc. ("AHS"). The acquisition was accounted for as
a purchase and the  operations  of AHS are included in the results of operations
of TEI from the acquisition  date. AHS provides  in-room  facsimile and business
center  services  to  the  hotel  industry  through  licensing  agreements.  AHS
generates  revenues from its InnFax  product  line, a patented  in-room send and
receive  facsimile service and The Office,  full service business  centers,  for
business travelers staying at hotels.

NOTE C - ACQUISITION OF AHS

     TEI acquired AHS in October 1999, and accordingly  AHS's operations are not
reflected in TEI's six month ended 1999 financials.  The following unaudited pro
forma  consolidated  results for the three and six month  period  ended June 30,
1999 assumes the acquisition of AHS occurred as of January 1, 1999.

                                        Three Months Ended     Six Months Ended
                                           (unaudited)            (unaudited)
                                           June 30, 1999         June 30, 1999
                                           -------------         -------------
Revenues                                    $ 4,857,392          $  12,167,817
Net loss                                       (367,969)            (2,779,240)
Basic and diluted loss per
   share                                    $     (0.07)         $       (0.57)

(NOTE - Earnings per shares were adjusted for preferred dividends)

                                        9
<PAGE>
NOTE D - DIVIDENDS

     Dividends  were  declared  on  February  28 and June 1,  2000,  for Class A
Preferred  Stock at $0.9375 and $0.7188 per share  totaling  $12,435 and $11,268
for the periods ending March 31 and June 30, 2000,  respectively.  This dividend
was paid in the form of common  stock at the rate of 0.11  shares of common  for
each share of preferred.

     The dividend was payable on March 31 and June 30, 2000 to  stockholders  of
record at the close of business of February 28 and May 31, 2000, respectively.

NOTE E - INVENTORIES

Inventories consist of the following at June 30, 2000:

Electronic components, batteries and assembly
       materials.............................................$       2,015,478
Facsimile and business center inventory......................          118,397
Inventory obsolescence reserve...............................         (403,275)
                                                                  ------------
                                                             $       1,730,600
                                                                  ============

NOTE F - LINE OF CREDIT

Line of credit at June 30, 2000 consists of the following:

       $3,000,000 line of credit with bank,
       payable on demand, with interest
       payable monthly at prime plus 2%
       (11.5% at June 30, 2000),
       maturing August, 2002 and secured by
       accounts receivable, inventories,
       equipment and intangibles of  UBC.
       Pursuant to borrowing base formulas,
       as of June 30, 2000 additional
       borrowings of $488,583 are available
       under the line of credit....................................$1,072,512
                                                                   ==========

NOTE G - LONG-TERM DEBT

Long-term debt at June 30, 2000 consists of the following:

       Promissory note to financing company,
       with interest payable monthly at 12%,
       principal due at maturity August 25,2000
       and secured by stock of AHS ................................$  500,000

       Installment notes payable to leasing
       company, due in monthly installments
       ranging from $3,695 to $3,004,
       including interest at rates from
       14.50% to 14.52%, current portion of
       debt which matures October 2002,
       collateralized by facsimile and
       business center equipment of AHS ...........................   227,953
                                       10
<PAGE>
NOTE G - LONG-TERM DEBT (continued)

       Note payable to financing company,
       with interest payable monthly at 20.5%,
       principal due at maturity (October 2001),
       guaranteed by TEI, with first lien on
       all AHS assets and second lien on AHS
       common stock................................................ 2,375,000
                                                                    ----------
                                                                    3,102,953
                                                                    ----------
          Less current maturities..................................  (597,058)
                                                                    ----------
          Long-term portion........................................$2,505,895
                                                                    ==========

NOTE H - INCOME(LOSS) PER SHARE

     Basic net  income(loss)  per share is computed by dividing net income(loss)
by the weighted  average  number of common  shares  outstanding  for the period.
Diluted net  income(loss)  per share is computed by dividing net income(loss) by
the  weighted  average  number of common  shares  and common  stock  equivalents
outstanding for the period.  TEI's common stock  equivalents are not included in
the diluted loss per share for June 30, 2000 and 1999 as they are  antidilutive.
Therefore, diluted and basic loss per share is identical. Net loss per share for
the six month period ended June 30, 2000 and 1999 has been decreased (increased)
for dividends on preferred stock.

NOTE I - WARRANTS AND STOCK OPTIONS

     On February 16,  2000,  TEI agreed to extend to March 10, 2002 the exercise
date of options to purchase  1,000,000 shares,  originally granted in connection
with an equity offering, exercisable at $2.50 per share.

     On  February  24,  2000,  TEI issued  Caspic  International,  Inc.  250,000
warrants for providing a $500,000  loan.  The warrants are  exercisable at $0.73
per share with an  expiration  date of February  25,  2005.  The  warrants  were
recorded at fair value using the Black-Scholes model as deferred financing fees,
totaling  $163,554.  The warrants are being  amortized  over three  months,  the
initial maturity period of the loan. (See Note L)

     On June 24, 2000, the Board of Directors  adopted the 2000 Incentive  Stock
Option Plan (the "2000 ISOP").  At June 30, 2000 there are 27,000 options issued
and outstanding under the 2000 ISOP.  These options are  exercisable  at $0.7188
per share with an  expiration date  of  June 26, 2003.  There are  an additional
1,973,000  shares available for grant under the 2000 ISOP.  All the shares under
the  2000 ISOP have been registered  with the Securities and Exchange Commission
on Form S-8.

NOTE J - EXCESS OF NET ASSETS OF COMPANIES ACQUIRED OVER COST

     The deferred  credit results from the excess of the estimated fair value of
the net assets acquired over the purchase price paid for AHS. After  application
to all non current assets  acquired,  this amount  totaling  $4,163,233 is being
amortized using the straight-line method over 8 years.  Amortization for the six
month period ended June 30, 2000 was $260,202.


                                       11
<PAGE>
NOTE K - EXTRAORDINARY GAIN

     TEI  recognized an  extraordinary  gain of $568,750 in connection  with the
retirement of a $2,100,000  note  payable.  The note was paid with $500,000 cash
and 1,100,000  common shares of TEI on February 25, 2000. The shares and related
debt  settlement  were  recorded at the trading price of the common stock on the
payment date, which was $0.9375 per share.

NOTE L - RELATED PARTIES

     On October 26, 1999, TEI completed the  acquisition of AHS. As part of this
transaction,  TEI arranged for a $2,525,000  credit  facility  through an agent,
Appel   Investments,   Inc.   ("Appel"),  for  AHS  to  refinance  its  existing
indebtedness.  William Tan Kim Wah is President and CEO of TEI, and his brother,
Kim Yeow Tan is an officer of Appel.  $1,525,000  of the said  indebtedness  was
refinanced  through Appel directly.  In conjunction with Appel's $1,525,000 loan
to refinance AHS indebtedness,  AHS paid a loan origination fee of $150,737.  As
additional  consideration  for  the  refinancing,  Appel  received  warrants  to
purchase 116,703 shares of common stock of TEI,  exercisable at $0.75 per share.
The warrants  expire on October 20, 2004.  The remaining  $1,000,000 of the said
$2,525,000  indebtedness  was  refinanced  through AHS Funding  LLC, a financing
company  whose  principal,  Jenny  Jechart,  is also a  shareholder  of TEI.  In
conjunction with AHS Funding LLC's $1,000,000 to finance AHS  indebtedness,  AHS
paid a loan origination fee of $98,828. As additional consideration, AHS Funding
LLC received  warrants to purchase 76,514 shares of TEI common stock exercisable
at $0.75 per share.  The  warrants  vest  immediately  and expire on October 20,
2004. These warrants were recorded at fair value using the  Black-Scholes  model
as  deferred  financing  fees,  and are  being  amortized  over  the life of the
respective loans. The total facility of $2,525,000  arranged through Appel bears
interest at 20.5% per annum,  and is payable  monthly with the  principal due in
full on October 21, 2001.

     TEI engaged Placement & Acceptance,  Inc. ("PAI"), a British Virgin Islands
corporation, to effect a private placement of securities,  which was consummated
in December 1997.  William Tan Kim Wah is a director and shareholder of PAI. PAI
received fees of $112,000,  inclusive of expenses,  for acting as sales agent in
the  placement.  TEI also  engaged  PAI in  October,  1999 to  effect a  private
placement of securities  for TEI's  acquisition of AHS. PAI received a placement
fee of warrants to purchase  500,000  shares of common stock.  In addition,  TEI
retained PAI to refinance the outstanding AHS indebtedness  required to complete
the  acquisition.  PAI received a placement fee of warrants to purchase  550,000
shares of common stock in consideration  for services  rendered.  These warrants
are  exercisable  at $0.75 per  share and  expire on  October  20,  2004.  These
warrants were recorded at fair value using the  Black-Scholes  model as deferred
financing fees, and are being amortized over the life of the respective loans.

     On February  24, 2000,  TEI  renegotiated  and paid in full its  $2,100,000
promissory  note that composed part of the purchase price of the  acquisition of
AHS by the payment of $500,000  cash and the  issuance  of  1,100,000  shares of
common stock.

     The  $500,000  cash was raised by a loan from  Caspic  International,  Inc.
William Tan Kim Wah is also a director and shareholder of Caspic  International,
Inc. The loan is due on August 25, 2000, bears an interest rate of 12% per annum
payable  monthly  and is secured  by a pledge of the shares of capital  stock of
AHS. As  additional  consideration  for the loan,  TEI also  issued  warrants to
purchase  250,000  shares  of  common  stock at  $0.73  per  share,  exercisable
immediately, with an expiration date of February 23, 2005. (See Note I)
                                       12
<PAGE>
NOTE M - COMMITMENTS AND CONTINGENCIES

Commitments

     AHS has entered into an agreement with a leasing company which requires AHS
to pay $5 per machine each month for two years,  which  represents the estimated
residual value at the end of a four-year  leasing  contract.  The future minimum
payments under this agreement at June 30, 2000 are as follows:

2000............................................... $     111,612
2001...............................................       117,413
2002...............................................        32,281
                                                     ------------
                                                    $     261,306
                                                     ============
Guarantees
     In   March  1998,   TEI  completed  the   acquisition   of  a   controlling
interest in US Computer Group, ("USCG") a company that provided a broad range of
information  technology  services and  products.  On February 25, 1999,  Telstar
Entertainment  ("Telstar"),  the second largest shareholder of USCG, contributed
additional  capital to USCG through the purchase of  additional  shares,  making
Telstar the largest shareholder of USCG.  Effective February 25, 1999 TEI ceased
reporting USCG's financial results in its consolidated  financial statements and
uses the equity method to account for its minority interest. On October 20, 1999
TEI  guaranteed a payment made by Telstar to USCG totaling  $100,000 for working
capital.  In March  2000,  an USCG  bank  creditor  foreclosed  on all of USCG's
assets,  effectively terminating all of USCG's operations.  TEI has guaranteed a
portion of the USCG bank indebtedness. On June 7, 2000, Coast sued TEI in the US
District  Court for the Central District of California,  Case No. CV-00-06115 NM
(RZx), to collect $361,740 plus interest, attorney fees and costs.  Coast claims
that  TEI  is  liable  to Coast on certain TEI guarantees of loans from Coast to
USCG.  TEI has filed an answer  denying any liability on its guarantees of Coast
loans.  Management is unable  to determine at this time the amount, if any, that
TEI may become obligated to pay Coast on its said guarantees.

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

The following  discussion and analysis should be read in conjunction  with TEI's
Consolidated  Financial  Statements and notes thereto included elsewhere in this
Form  10-QSB.  Except  for the  historical  information  contained  herein,  the
discussion in this Form 10-QSB contains certain forward looking  statements that
involve risks and uncertainties,  such as statements of TEI's plans, objectives,
expectations and intentions.  The cautionary statements made in this Form 10-QSB
should be read as being  applicable  to all related  forward-looking  statements
wherever  they appear in this Form 10-QSB.  These  statements  include,  without
limitation,  statements  concerning the potential  operations and results of the
Company described below. TEI's actual results could differ materially from these
discussed  here.  Factors  that could cause or  contribute  to such  differences
include, without limitation,  those factors discussed herein and in TEI's Annual
Report on Form 10-KSB for the year ended December 31, 1999.

BACKGROUND AND RECENT DEVELOPMENTS

     The results of  operations  for the six months ended June 30, 2000 does not
include  USCG  operations,  while the  comparative  period of 1999  includes two
months of USCG  operations.  As AHS was acquired as a purchase in October  1999,
the  financial  statements  for the six months  ended June 30, 2000  include six
months of AHS activity with no operations  of AHS for the  comparative  1999 six
months.
                                       13
<PAGE>
     As  previously  discussed,  TEI was  advised  on March 22,  2000 that Coast
Business  Credit,  Inc.  ("Coast"),  has declared that USCG defaulted on certain
loans from Coast and has demanded  full payment by USCG for all such loans.  TEI
was advised  verbally by Coast's attorney that it had foreclosed and sold all of
USCG's  assets that were  pledged to secure loans from Coast.  TEI  guaranteed a
portion of those loans.  On June 7, 2000,  Coast  sued  TEI  in the US  District
Court for the Central District of California,  Case No. CV-00-06115 NM (RZx), to
collect $361,740 plus interest, attorney fees and costs.  Coast  claims that TEI
is  liable  to Coast on certain TEI guarantees of loans from Coast to USCG.  TEI
has filed an answer  denying  any  liability  on  its guarantees of Coast loans.
Management is unable to determine at this time the amount, if any,  that TEI may
become obligated to pay Coast on its said guarantees.

     On  April  28,  2000,  the  American  Arbitration  Association  awarded  an
ex-employee of UBC's $375,865 due to breach of his employment  agreement.  As of
June 30, 2000 $225,000 relating to this settlement had been paid.  The remaining
$150,865 was paid in full on August 1, 2000.

     In July  2000,  CCC filed  with the  State of Texas to  change  its name to
Universal Battery Corporation ("UBC").

RESULTS OF OPERATIONS

     Currently, TEI's operations are conducted through its subsidiaries, UBC and
AHS.

THREE MONTHS ENDED JUNE 30, 2000 COMPARED TO THREE MONTHS ENDED JUNE 30, 1999.

REVENUES

     For the three  month  period  ended  June 30,  2000,  TEI had  revenues  of
$5,667,467 compared to $2,526,774 for the similar period ended June 30, 1999, an
increase of $3,140,693 (124.30%).

     Revenues of UBC totaled  $3,421,711  and of AHS totaled  $2,245,756 for the
three  months  ended June 30, 2000  compared to revenues of  $2,526,774  and $0,
during  the  similar  period in 1999.  UBC's  sales  increase  is related to the
increasing  sales in batteries  and related  products as well as entering  other
battery markets, including consumer, medical and security.  Also, UBC has  begun
direct shipping to certain customers which  require large volume on a particular
item which has enabled UBC to compete with the larger market items.

COST OF REVENUES

     For the three  month  period  ended June 30,  2000,  TEI's cost of revenues
increased  to  $3,490,688  compared to cost of revenues  of  $1,982,475  for the
similar period in 1999, an increase of $1,508,213 (76.08%).

     Increased  sales  at UBC and AHS  resulted  in an  increase  in the cost of
revenues during the three month period ended June 30, 2000.  However, in the 2nd
quarter of 2000, UBC received  better prices from their  suppliers  resulting in
cost of  revenues as a  percentage  of revenue  decreasing  to 61.59% in the 2nd
quarter of 2000, compared to 78.46% for the similar period in 1999.

GROSS PROFIT

     For the three month period ended June 30, 2000, TEI recorded a gross profit
of $2,176,779  compared to $544,299 for the similar  period in 1999, an increase
of $1,632,480 (299.92%).
                                       14
<PAGE>
     For the  three  month  period  ended  June  30,  2000,  gross  profit  as a
percentage  of revenue for UBC  decreased  to 20.41%  compared to 21.54% for the
similar  period  in  1999.  The  decreasing   gross  profit  margin  of  UBC  is
attributable to the focus on battery and battery-related products, which produce
a lower profit margin than component sales.  On June 7, 2000, Coast sued TEI in
the  US  District  Court  for  the  Central  District  of  California,  Case No.
CV-00-06115 NM (RZx),  to  collect  $361,740  plus interest,  attorney  fees and
costs.  Coast  claims  that  TEI is liable to Coast on certain TEI guarantees of
loans from Coast to USCG.  TEI has filed  an answer denying any liability on its
guarantees of Coast loans.  Management is unable  to  determine at this time the
amount,  if any,  that  TEI  may  become  obligated  to  pay  Coast  on its said
guarantees.

OPERATING EXPENSES

     For the three month period ended June 30, 2000,  TEI's operating  expenses,
consisting  mainly of selling,  general  and  administrative,  depreciation  and
amortization  expenses  increased  to  $2,110,637  compared to $573,442  for the
similar period in 1999, an increase of $1,537,195 (268.06%).

     The  increase in the  selling,  general  and  administrative  expenses  was
attributable  to an increase of $677,150 in legal fees,  advertising  and travel
costs  at  UBC,  and  $1,217,887  in  recruiting   fees,  due  diligence   fees,
communications,  and wages at AHS  during the second  quarter.  For the  similar
period  in  1999  AHS  had no  operating  expenses  included  in  the  financial
statements.

     For the three month period ended June 30,  2000,  TEI incurred  $284,483 in
depreciation  and  amortization  compared to $18,782  for the similar  period in
1999, an increase of $265,701 (1,414.65%).  The increase is largely attributable
to AHS's depreciation of revenue assets of $225,184.

INTEREST EXPENSE AND FINANCING FEES

     During the three month period ended June 30, 2000, TEI incurred $202,051 in
interest  expense compared to $8,315 for the similar period in 1999, an increase
of $193,736 (2329.96%).

     The increase in interest  expense is attributable to a note payable entered
into by AHS in the fourth quarter of 1999,  which incurred  $153,492 in interest
expense in the three month period ended June 30, 2000.

     Deferred  financing costs are amortized on a  straight-line  basis over the
original  term of the  financing  agreement.  TEI  issued  warrants  to  various
lenders,  which were  recorded  at fair  value  using the  Black-Scholes  model.
Amortization of these deferred  financing costs was $153,798 for the three month
period ended June 30, 2000.

SIX MONTHS ENDED JUNE 30, 2000 COMPARED TO SIX MONTHS ENDED JUNE 30, 1999.

REVENUES

     For the six  month  period  ended  June  30,  2000,  TEI  had  revenues  of
$11,374,960  compared to $7,719,562  for the similar period in 1999, an increase
of $3,655,398 (47.35%).

     The increase in revenues is largely attributable to an increase in sales of
UBC of $7,087,963  and AHS of $4,286,997  for the six months ended June 30, 2000
                                       15
<PAGE>
compared  to  revenues  of  $4,531,901  and $0 for the  similar  period in 1999,
respectively.  The UBC sales  increase  is  related to the  increasing  sales in
batteries and related products.  Also, UBC has begun  direct shipping to certain
customers which require large  volume on a particular item which has enabled UBC
to compete with the larger market items.

COST OF REVENUES

     For the six month  period  ended  June 30,  2000,  TEI's  cost of  revenues
increased to $6,786,751  compared to $6,017,124  for the similar period in 1999,
an increase of $769,627 (12.79%).

     Increased  sales at UBC  resulted  in an  increase  in the cost of revenues
during  the six  month  period  ended  June  30,  2000.  Cost of  revenues  as a
percentage of revenue  increased  slightly to 79.18% for the first six months of
2000  compared  to 77.54% for the similar  period in 1999.  When UBC does direct
shipments from their  factories to their  customers they have a lower margin due
to their larger volume items and not handling the orders as much as UBC would on
smaller orders.

     Included in the cost of revenues  for the six month  period  ended June 30,
2000 are  $1,173,839  for AHS, and none in 1999,  and $2,694,228 for USCG in the
six month period ended June 30, 1999, none in 2000.

GROSS PROFIT

     For the six month period  ended June 30, 2000,  TEI recorded a gross profit
of $4,588,209 compared to $1,702,438 for the similar period in 1999, an increase
of $2,885,771 (169.51%).

     The  increase in gross  profit  stems from the  acquisition  of AHS and the
increasing sales from UBC.

     For the six month period ended June 30, 2000,  gross profit as a percentage
of revenue  for UBC  decreased  slightly  to 20.81%  compared  to 22.32% for the
similar  period  in  1999.  The  decreasing   gross  profit  margin  of  UBC  is
attributable to the focus on battery and battery-related products, which produce
a lower profit margin than component sales.

OPERATING EXPENSES

     For the six month  period ended June 30, 2000,  TEI's  operating  expenses,
consisting  mainly of selling,  general and  administrative,  legal  settlement,
depreciation  and  amortization  expenses  increased to  $4,635,690  compared to
$3,365,724 for the similar period in 1999, an increase of $1,269,966 (37.7%).

     The increase is attributable to the following:  USCG contributed $1,944,840
in  selling,  general  and  administrative  expenses  in the first half of 1999,
compared  to none for the  similar  period in 2000.  UBC  selling,  general  and
administrative  expenses  increased  to  $1,374,251  in the  first  half of 2000
compared  to  $823,543  for  the  similar  period  in  1999.  This  increase  is
attributable to an increase in legal fees,  advertising and travel costs and the
writing off of a note receivable.  AHS incurred  $2,478,695 in selling,  general
and  administrative  expenses  in the first  half of 2000,  none in 1999.  AHS's
selling  and  administrative   expenses  were  attributable  to  communications,
research and development on existing product, and wages.

                                       16
<PAGE>
     For the six month  period ended June 30,  2000,  TEI  incurred  $675,107 in
depreciation  and  amortization  expense  compared to  $237,135  for the similar
period in 1999, an increase of $437,972 (184.69%).

     The  increase  is largely  attributable  to AHS's  depreciation  of revenue
assets  of  $565,542  for the six  month  period  ended  June 30,  2000 and USCG
incurring  $181,803  in  amortization  cost for the first half of 1999,  none in
2000.

INTEREST EXPENSE AND FINANCING FEES

     For the six month period June 30, 2000,  TEI incurred  $402,063 in interest
expense  compared to $140,712  during the similar period in 1999, an increase of
$261,351 (185.73%).

     The increase in interest expense is largely  attributable to a note payable
entered into by AHS,  which  incurred  $322,618 in interest  expense  during the
first six months ended June 30, 2000, none in 1999.

     Deferred  financing costs are amortized on a  straight-line  basis over the
original  term of the  financing  agreement.  TEI  issued  warrants  to  various
lenders,  which were  recorded  at fair  value  using the  Black-Scholes  model.
Amortization  of these deferred  financing costs was $311,523 for the six months
period ended June 30, 2000, compared to none for the similar period in 1999.

EXCESS OF NET ASSETS OF COMPANIES ACQUIRED OVER COST

     The deferred  credit results from the excess of the estimated fair value of
the net assets acquired over the purchase price paid for AHS. After  application
to all non current assets  acquired,  this amount  totaling  $4,163,233 is being
amortized  using the  straight-line  method over 8 years.  Amortization  for the
period ended June 30, 2000, was $260,202 compared to none for the similar period
in 1999.

EXTRAORDINARY GAIN

     TEI recognized an extraordinary gain of $568,750 from the retirement of the
PricewaterhouseCoopers,  Inc.  note  of  $2,100,000  that  composed  part of the
purchase price of the AHS acquisition.  The note was paid with $500,000 cash and
the issuance of 1,100,000 common shares in February 2000.

INVENTORY

     TEI continually reviews its inventory allowance procedures and policies and
will make  adjustments as necessary.  During the period ended June 30, 2000, TEI
recorded $6,000 as a reserve for inventory  allowance,  compared to $200,930 for
the similar  period in 1999.  For the first half of 1999, UBC recorded a $80,930
inventory  reserve  for slow  moving  passive  components  and USCG  recorded  a
$120,000 reserve prior to the deconsolidation.

LIQUIDITY

     TEI had cash and cash equivalents of $847,633 and $523,274 at June 30, 2000
and 1999, respectively.

     For the six month period ended June 30, 2000, TEI used cash from operations
of $512,017  compared to cash provided by operations of $385,752 for the similar

                                       17
<PAGE>
period  in 1999.  The increase in cash provided by operations  is largely due to
an increase in cash, account payables and accrued liabilities.


     For the six month period  ended June 30,  2000,  TEI used cash in investing
activities of $45,574  compared to $498,877 for the similar  period in 1999. The
majority of the cash was used to purchase  new  property  and  equipment in 2000
whereas  during the six month  ended June 30, 1999 cash was used  primarily  for
advances to a related  party of  $222,397  and the  de-consolidating  of USCG of
$316,262.

     For the six month  period  ended  June 30,  2000,  TEI  provided  cash from
financing  activities of $512,963 compared to cash used in financing of $762,661
for the similar  period in 1999.  During the six months ended June 30, 2000, UBC
received  $214,993  of net  proceeds  under its line of  credit.  TEI  organized
repayment of their  acquisition  debt and  recognized a gain in connection  with
this settlement and refinancing transactions.

     TEI has a  $500,000  note payable due on  August  25,  2000  with a 12% per
annum interest rate, TEI is currently  negotiating  payment  arrangements.  AHS,
also has a note payable of $2,375,000 with a 20.5% interest rate with a maturity
date of October, 2001. AHS is currently looking into other loan arrangements.

INFLATION

     TEI has not been  materially  effected  by  inflation.  While  TEI does not
anticipate inflation affecting TEI's operations, increases in labor and supplies
could impact TEI's ability to compete.

INTERNATIONAL CURRENCY FLUCTUATION

     Since the majority of goods that UBC  purchases  are from Asia, it has been
subject, like its competitors,  to international  currency fluctuation since the
company's inception. The management of UBC does not believe that the fluctuation
in currency presents a serious threat to its operations.

PART II - OTHER INFORMATION

Item 1.  Legal Proceedings.

     Martin Frank, a former employee of UBC, filed an arbitration claim with The
American  Arbitration  Association  against  UBC and TEI for the  breach  of his
employment  agreement.  On April 28, 2000, the Arbitration  panel awarded Martin
Frank $375,865. The award has been paid.

     AHS was a defendant in a lawsuit filed by a competitor  claiming that AHS's
The Office product  infringes on a patent  assigned to the said  competitor.  In
order to end this  litigation  and the resultant  legal fees, in April 2000, AHS
paid the competitor $50,000 to settle the case and all claims of the competitor.

     On June 7, 2000,  Coast sued TEI in the US  District  Court for the Central
District of California,  Case No. CV-00-06115 NM (RZx), to collect $361,740 plus
interest, attorney fees and other related legal costs.  Coast claims that TEI is
liable to Coast on certain TEI guarantees of loans from  Coast to USCG.  TEI has
filed  an  answer  denying  any  liability  on  its  guarantees  of Coast loans.
Management is unable to determine at this time the amount,  if any, that TEI may
become obligated to pay Coast on its said guarantees.

                                       18
<PAGE>
Item 2.  Changes in Securities.

None.

Item 3.  Defaults Upon Senior Securities.

None.

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

None.

Item 5.  Other Information.

     The deadline for  submitting  shareholder  proposals for inclusion in TEI's
proxy  statement  and form of proxy for TEI's May 30,  2001,  annual  meeting of
shareholders is November 30, 2000.



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

     Effective  June 26, 2000,  the Company's  principal  executive  offices are
located at 275 North Franklin Turnpike,  Suite 230, Ramsey, NJ 07446.  Telephone
number (201) 760-9900. Fax number (201) 760-9901.



                                    Signature


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


                                              Tech Electro Industries, Inc.
                                               -----------------------------


Date:  August  14, 2000

                                            /s/ Julie Sansom-Reese
                                            -----------------------------
                                            Interim Chief Financial Officer












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