UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington. D.C. 20549

                                   FORM 10-QSB

              [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                     For the nine months ended June 30, 2000

                                       OR

              [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                  For the transition period from______to_______

                         Commission file number 1-12835

                               WORLD CALLNET, INC.
             (Exact name of registrant as specified in its charter)

                  Delaware                                      75-2468002
         (State or other jurisdiction of                     (I.R.S. Employer
          incorporation or organization)                     Identification No.)



           Brecon House, Meridian Gate, 207 Marsh Wall, London E14 9YT
            (Address of principal executive offices)      (Zip Code)

       (Registrants' telephone number, including area code) 0171 335 8300

      Securities registered under Section 12 (b) of the Exchange Act: None

         Securities registered under Section 12 (g) of the Exchange Act:


                          Common Stock, Par Value $.001
      --------------------------------------------------------------------
                                (Title of Class)

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

     As of August  10,  2000  there  were  17,671,304  shares  of  registrant's
common stock outstanding.

     Transitional Small Business Disclosure Format (Check One):  Yes    No X
                                                                    ---   ---


                                       1

<PAGE>


REGISTRANT'S  DISCLAIMER STATEMENT RE: PRIVATE SECURITIES  LITIGATION REFORM ACT
AND OTHER MATTERS

         The  statements  in this Report on Form 10-QSB and in other  filings by
World CallNet, Inc. (the "Company") with the Securities and Exchange Commission,
or in press  releases  issued by the  Company  that are not based on  historical
information  are  considered  forward-looking  statements  within the meaning of
Section 27A of the  Securities  Act of 1933, as amended,  and Section 21E of the
Securities Exchange Act of 1934, as amended,  including statements regarding the
Company's projections,  hopes, expectations,  intentions,  beliefs or strategies
regarding the future.  Forward-looking  statements include,  but are not limited
to, plans  discussed in the Company's  Form 10-K for the period ended  September
30, 1999, in the section entitled  "Description of Business" regarding:  (i) its
plans to market its proprietary MailTV products in Europe, North America,  South
America and Asia Pacific,  (ii) its belief that  offering  free Internet  access
will capture customers for CallNet Plc, (iii) its statement that other companies
engaged in Internet related businesses may be acquired, (iv) its belief that the
majority of its future revenues will be derived from MailTV and its ownership of
CallNet Plc,  which earns a share of telephone toll revenues from companies that
provide  telephone  service  to their  customers,  and (v) the  belief  that its
products and services will appeal to the many  segments of the Internet  market;
its statement in Legal Proceedings that the outcome of any legal proceedings and
claims  against  the  Company  will not have a  material  adverse  effect on the
Company's business,  operating results, and financial condition;  and statements
in Liquidity and Capital Resources  regarding (i) the statement that the Company
has a working capital deficit and has generated  significant operating losses to
date, (ii) the projection that additional capital from additional  placements of
bridge notes, the sale of debt or equity securities,  the entering into of other
financial  instruments,  the sale or joint  venturing of assets or businesses to
fund   operating   expenses  will  be  necessary  for  the  Company  to  survive
financially,  (iii) the expectation that product  development and  manufacturing
costs will be borne by the Company and business  partners,  (iv) the estimate of
property and/or significant  capital equipment  expenditures for the next twelve
months,  (v) the expectation  that Internet  related  revenues  derived from its
proprietary  MailTV  products  and  ownership of CallNet Plc will be the primary
source  of  internal  liquidity  and  sales of  products  that are  designed  to
facilitate new Internet access will be a secondary source of internal liquidity,
and (vi) the anticipation  that the year 2000 will not have a material impact on
the Company.


         On  August 1, 2000  Shareholders  representing  in excess of 50% of the
Company's voting stock by Action without Meeting, and in accordance with Section
228 of the  Delaware  Corporations  Code and  Section  11 of  Article  II of the
By-laws of the  Corporation,  removed  the  Company's  executive  Directors  and
appointed  a new  executive  board.  The  Company  therefore  advises  that  the
statements in the previous paragraph are those of previous  management and until
the  Company's  newly  elected  board  has had  sufficient  time to  review  the
Company's  operations and affairs the current  Management is not in any position
to comment on any prior  forward-looking  statement or claim  previously made by
the Company or its past Management.

         It is possible that the  Company's  projections,  hopes,  expectations,
intentions, beliefs, plans or strategies regarding the future and hopes outlined
above may not be achieved due to factors and circumstances  discussed  elsewhere
in this Form 10-QSB. See Part 1, Item 2,  "Management's  Discussion and Analysis
or Plan of Operation."


                                       2

<PAGE>


     World CallNet, Inc. is not affiliated with, sponsored by or endorsed by any
of the following  companies who have similar trade names,  trademarks or service
marks:   Worldcall   Communications   International,   Inc.;   Computer  Calling
Technologies,   Inc.;  AT&T  Corp.;  Worldnet   Communications,   Inc.;  Luckman
Interactive,   Inc.;   Allnet   Communications   Services,   Inc.;   West  Coast
Telecommunications, Inc.; WCN Ltd.; and Worldnet Communications, Inc.


PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements.

     Financial  information  required  by Item 301(b) of  Regulation  S-B can be
found on the pages following Item 2 below. The financial  information  contained
herein for the nine months  ended June 30, 2000 is  unaudited  but  includes all
adjustments that the Company considers  necessary for a fair presentation of the
results  for  such  periods.  The  financial   information  should  be  read  in
conjunction with the financial  statements for the year ended September 30, 1999
included in the Company's  Annual Report on Form 10-KSB.  Operating  results for
the nine  months  ended  June 30,  2000 are not  necessarily  indicative  of the
results that may be expected for the entire year ended September 30, 2000.

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

     During 1998 the Company  sold all of its  interests  in oil and gas royalty
properties for cash and, after repayment of debt and accounts payable,  became a
publicly traded shell. In October 1998, the Company completed the acquisition of
World Wide Communication  (Holdings) Ltd. ("WWCH"),  in a transaction  accounted
for as a reverse  acquisition.  As a result, the Company became the successor to
the business and financial  operations of WWCH,  including its fiscal yearend of
September  30. WWCH began  operations  in January 1998 and this report  includes
historical  data since that date. In January 1999, the Company  changed its name
to World CallNet, Inc.

LIQUIDITY AND CAPITAL RESOURCES
-------------------------------

     Since  incorporation  in  January  1998,  the  Company  has  been  involved
primarily in capital formation  activities,  refinement of its business strategy
and development of relationships with industry partners. The Company's principal
external  source of capital for  developing  its  products and services has been
proceeds from bridge debt  financing and the private  placement of common stock.
It is the view of the current Company Board, since appointment two weeks ago and
on a limited  corporate  review to date,  that  additional  placements of bridge
notes,  the sale of equity  securities,  the  entering  into of other  financial
instruments,  the  sale or joint  venturing  of  assets  or  businesses  to fund
operating expenses will be necessary for the Company to survive financially.

     In  September   1999,   the  Company   entered   into  an  agreement   with
Australian-based  MailTV  Pty  Limited  to sell up to  14,500,000  shares of its
common stock for cash and equity ownership in MailTV Pty. Limited's Dallas based
parent  company,  KeyClub.net,  Inc.  As of the date of this  report the sale of
4,143,915  shares the  Company's  common  stock to MailTV Pty Limited  have been
completed  pursuant to the terms of the agreement.  The Company received a total
of $3,884,920 in cash and 653,125  shares of common stock of  KeyClub.net,  Inc.
the parent company of MailTV Pty, in  consideration  for the 4,143,915 shares of
the Company's common stock.


                                       3

<PAGE>


     Under the  terms of the  agreement  MailTV  Pty  Limited  can  purchase  an
additional 10,356,085 shares of the Company's common stock on the same terms. It
is  uncertain  whether any  additional  sales of common  stock will be completed
pursuant to the agreement.  The Company's  board is currently  reviewing  MailTV
Pty.  Limited's  claim of various  breaches of  Agreement  by the  Company,  the
non-completion  of Conditions  Precedent by the Company and possible  commercial
resolution between the Company, MailTV Pty. Limited and KeyClub.net, Inc.

     In January 2000, the Company  completed a private placement of common stock
totaling  $2,362,500  at $1.75 per share.  The Company  also  completed in April
2000, a private  placement of common stock totaling  $3,981,112 at $4 per share.
Since  August 1999,  the Company has raised  capital from the sale of its common
stock totaling approximately $10,075,000, net of cash commissions.

     Approximately  $585,500 of the proceeds  from the  aforementioned  sales of
common stock was used to repay bridge notes payable and accrued interest.  Since
October  1,  1999,  the  Company  has spent  approximately  $490,000  on capital
expenditures  including plant/office  equipment,  furniture and software billing
system.  The  balance  has been  used as  working  capital  and to pay the costs
incurred in an unsuccessful proposed public offering and merger by CallNet Plc.,
a wholly owned subsidiary of the Company.

     As of June 30,  2000,  the  Company had a net  working  capital  deficit of
approximately  $1,100,000.  For the nine months ended June 30, 2000, the Company
used $6,764,077 in cash by operations and has incurred  $15,068,303 in operating
losses since its  inception.  To date,  the Company has met its working  capital
needs  through  private  placement  sales of its  common  stock for cash and the
issuance of common stock to repay debt obligations to certain creditors.

     On March 31, 2000, bridge notes payable of $1,137,500 plus accrued interest
of $57,500 were repaid in exchange for 891,787  shares of the  Company's  common
stock. The transaction  included the exercise of 487,500 stock purchase warrants
at $1 per share,  with the remaining  $707,500 of principal and accrued interest
exchanged for common stock at $1.75 per share.

     Subsequent to June 30, 2000, Shareholders representing in excess of 50%
of the Company's  voting stock,  by Action without Meeting removed the Company's
executive  directors and appointed a new executive  board on Tuesday,  August 1,
2000 (See Part II, Item 5, Other Information).

     Since  appointment  of a new  board on  August  1,  2000,  the  Company  is
reviewing its  investment in CallNet Plc.,  which  incurred an operating loss of
approximately   $6,100,000  for  the  nine  months  ended  June  30,  2000.  The
unprofitable  economics  of providing  Internet  service at no charge to CallNet
Plc's  subscribers  has resulted in the  discontinuation  of CallNet's free 0800
Internet  access  programs.  The  Company  has  implemented  a pay as you go fee
structure for existing customers. Currently, the possible sale of CallNet Plc to
unaffiliated  third parties is being investigated by the Company as are possible
listing opportunities.

     The Company's  principal  product is MailTV,  an affordable  alternative to
purchasing  a computer  that  provides  the user  access to text based  Internet
services such as email,  on-line stock quotes and other similar  services.  With
MailTV a connection to a local  telephone  service and a television  set are the
only  requirement.


                                       4

<PAGE>


     MailTV chips are either embedded into new television sets or available as a
retrofit device or set top box for existing televisions sets and are intended to
be available for a price significantly lower than rival "Web TV" units.

     The  Company  is  currently  reviewing  all its plans for  future  business
operations.  The Company  will  require  substantial  capital to  implement  any
revised  business plan.  The Company is  considering  ways that costs of product
development,  manufacturing and marketing of its MailTV products may be financed
through the sale of the Company's equity securities, from joint venture partners
seeking  an  economic  interest  in  the  MailTV  technology,   or  through  its
relationship with MailTV Pty. Limited or KeyClub.net, Inc.

     The Company has  incurred  significant  net losses since  inception,  which
raises  substantial  doubt  about the  Company's  ability to continue as a going
concern.  If  additional  financing  is not  successfully  completed  and if the
Company  is not able to  obtain  additional  financing  arrangements,  it may be
unable to meet its continuing operational obligations, pursue its basic business
strategy,  take  advantage  of new  opportunities,  develop or enhance  existing
products,  or  respond to  competitive  pressures  and  financial  or  marketing
hurdles.  Such inability could have a materially adverse effect on the business,
operating results and financial condition.

     Moreover,  the  estimated  cost of the proposed  expansion of the Company's
production  and  marketing  activities  is  subject to  numerous  uncertainties,
including the problems, expenses,  difficulties,  complications and delays, many
of which are beyond management's control,  frequently  encountered in connection
with the  establishment and development of new business  activities,  and may be
affected  by the  competitive  environment  in which the  Company is  operating.
Accordingly,  there can be no  assurance  that the  Company  will  complete  the
proposed expansion of production and marketing activities described herein.

     The Company is  reviewing  its capital  expenditure  budgets for  projected
future needs for plant and/or significant capital equipment. The Company is also
reviewing  and  evaluating  its  commitment  to  complete  the  development  and
implementation  of an integrated  telecommunications  billing  system started in
March 2000.

     The  Company  has  implemented  certain  changes,  as  necessary,   to  its
information  systems and accordingly  does not anticipate any material year 2000
issues from its own systems, programs or from any of its products. The impact of
such issues on the Company's suppliers, customers, vendors and financial service
organizations is not expected to have an adverse effect on the Company.

RESULTS OF OPERATIONS
---------------------

     The  presentation of the results of operations with respect to revenues and
related  production and development  costs is based on the comparison of results
for  the  nine  and  six  months  ended  June  30,  2000  and  March  31,  2000,
respectively. Since the Company did not commence any of its significant business
operations  until  October  1999, a comparison  of fiscal year 2000 revenues and
related  production and development costs to the  corresponding  periods in 1999
would not be a relevant comparison.


                                       5

<PAGE>


     Revenues  for the nine  months  ended  June  30,  2000  totaled  $1,283,801
compared  to  $933,540  for the six months  ended  March 31,  2000.  Revenues of
approximately  $360,000,  consisting  of rebates and discounts for long distance
telephone  services and CallNet 0800  telephony  usage earned from CallNet Plc's
subscribers during the six months ended March 31, 2000 became  uncollectible and
were  charged to bad debt  expense in the  quarter  ended  June 30,  2000.  Such
revenues were not remitted to CallNet Plc by two companies  that were  obligated
to provide telephone  service to CallNet  customers  pursuant to revenue sharing
agreements.  As a result of the loss of these two telephone  service  providers,
revenues  declined  proportionately  for the three  months  ended June 30,  2000
compared to the six months ended March 31, 2000.

     Production  and  development  costs  attributable  to revenues for the nine
months ended June 30, 2000 totaled $4,046,399 compared to $1,875,855 for the six
months ended March 31, 2000. CallNet Plc's agreement with North American Gateway
("NAG") and WCN Ltd. (an unaffiliated  entity included as the telephony  service
provider in the  unsuccessful  CallNet Plc  proposed  merger with a London Stock
Exchange  company and public  offering in the UK) required these two entities to
pay all of the interconnect  charges for telephone usage by CallNet Plc internet
customers.  NAG and WCN Ltd., both switchless  resellers of telephone  services,
breached  contracts  with  CallNet  Plc by not paying  interconnect  charges for
CallNet Plc's customers  telephone usage and failed to remit any rebates or fees
earned for long distance calls placed by its customers. The Company has included
the interconnect  charges in its production and development  costs for the three
and nine months ended June 30, 2000.

     General and administrative  expenses increased from $1,447,547 for the nine
months ended June 30,  1999,  to  $6,200,379  for the nine months ended June 30,
2000. The increase was due to the cost of additional  personnel,  infrastructure
and facilities necessary to meet the growth in the Company's  operations.  Since
the launching of CallNet 0800 free Internet  access in October 1999, the Company
has added additional fulltime employees in response to the significant growth in
new subscribers.  General and administrative expenses for the three months ended
June 30, 2000 were  $3,159,678  compared to $537,602  for the three months ended
June 30,  1999.  The  extraordinary  increase was  primarily  due to the factors
described  above as well as  expenses  in the  current  quarter  related  to the
unsuccessful  proposed  merger with a London Stock  Exchange  company and public
offering in the UK. In  connection  with the  proposed  transaction  the Company
incurred approximately $435,000 in due diligence expenses, including legal fees,
audit costs, travel expenses, etc. during the three months ended June 30, 2000.

     Interest  expense  (before  amortization  of discount)  for the nine months
ended June 30, 2000  decreased  when  compared to the nine months ended June 30,
1999  due to the  repayment  of  $500,000  of  bridge  notes  in  October  1999.
Amortization of the remaining discount related to such debt was $195,049 for the
nine months  ended June 30, 2000 and was $132,507 for the nine months ended June
30,  1999.  The discount  related to the value,  as  calculated  using the Black
Scholes options  pricing model, of stock purchase  warrants issued in connection
with the bridge notes.

     Depreciation  and  amortization for the nine months ended June 30, 2000, is
primarily  composed  of $739,350  of  amortization  of the excess cost over book
value of the assets of CallNet Plc, which became a 100% owned  subsidiary of the
Company in September 1999.


                                       6

<PAGE>


CAUTIONARY FACTORS
------------------

     The success of the Company's plan of operation may be adversely affected by
several principal factors.

NEED FOR ADDITIONAL CAPITAL
--------------------------

     The Company needs a substantial amount of capital to achieve the objectives
in its business  plan.  Conditions  in financial  markets  influence  investors'
attitudes and  willingness to invest in a particular  industry issuer or type of
security.  If the Company is unable to obtain additional capital through private
or  public  placement  of its debt or  equity  securities,  asset  based or bank
financing,  or through ventures with industry  partners,  its ability to achieve
its business objectives could be substantially  impaired and further the Company
may not be able to continue operations.

COMPETITION
-----------

     The online  services  and  Internet  markets  are highly  competitive.  The
Company  believes  that  existing  competitors,  which  include,  among  others,
commercial  online  services  such as  America  OnLine  and  Dixon's  FreeServe,
Internet-based  services,  including,  among others, the Microsoft Network,  and
Internet service  providers,  including  various national and local  independent
Internet  service  providers as well as long  distance  and  regional  telephone
companies,  including,  among  others,  British  Telecommunications  and Cable &
Wireless   Communications  and  various  other  regional   telephone   operating
companies,  are likely to enhance  their  service  offerings.  In addition,  new
competitors,  including  Internet  directory  services  and  various  media  and
telecommunications  companies,  have  entered  or  announced  plans to enter the
online services and Internet markets,  resulting in greater  competition for the
Company. Many of the direct competitors and possible future competitors referred
to  above  have  significantly  greater  financial,   technical,  marketing  and
personnel resources than the Company.  These factors may have a material adverse
effect on the Company's  financial condition and operating results. In addition,
in  response  to  increased  competition,   the  Company  may  adopt  additional
strategies  designed to continue the growth in its subscriber  base, such as new
marketing  programs and  promotional  offers and  implementation  of new pricing
programs.  Such strategies may result in an increase in costs as a percentage of
revenue.

     The  business of  providing  Internet  access  services  is new,  extremely
competitive,  rapidly evolving and subject to rapid technological  change. World
CallNet expects that such competition  will intensify  significantly in the near
future.  A number of companies  are  developing or have  introduced  devices and
technologies  to  facilitate  access to the Internet via a  television.  Set top
boxes and  devices  are  proposed  or under  development,  as well as video game
devices that provide Internet access.  In addition,  manufacturers of television
sets  have  announced  plans  to  introduce  Internet  access  and Web  browsing
capabilities into their products through set-top boxes.

     Personal  computer  manufacturers are introducing  Personal  Communications
Systems  that offer  full-fledged  television  viewing  combined  with  Internet
access. Operators of cable television systems also plan to offer Internet access
in  conjunction  with cable  service.  World CallNet also competes with Internet
service providers and commercial online services. There can be no assurance that
World  CallNet's  competitors  will not develop  Internet  access  products  and
services  that are superior  to, and  priced  competitively  with those of World


                                       7

<PAGE>


CallNet,  thereby achieving greater market acceptance than MailTV. Many of World
CallNet's competitors,  as well as potential competitors,  have longer operating
histories,  greater  name  recognition,  larger  installed  customer  bases  and
significantly  greater financial,  technical and marketing  resources than World
CallNet.

SUBSCRIBER ATTRITION RATES
--------------------------

     World CallNet has devoted  considerable  financial  and human  resources to
attract  subscribers to its service;  however,  due to circumstances that may or
may not be beyond the control of the Company,  these subscribers may discontinue
their  affiliation with the Company.  As a result of subscriber  attrition,  the
revenues  generated  from Internet  usage may decline  considerably,  as may the
rates that the Company can charge from advertising on its service as well as the
revenues that the Company anticipates from e-commerce.

NETWORK CAPACITY AND OPERATIONS
------------------------------

     Rapid  growth in  subscriber  demand  may cause  the  Company  and its data
communications  access  providers to  experience  difficulty at certain times in
providing  adequate server and network  capacity.  As a result,  subscribers may
from time to time  encounter  difficulty  in  accessing  and  using the  CallNet
service.  There  can be no  assurance  that the  Company  will be able to expand
server  and  network  capacity  at  a  rate  sufficient  to  satisfy  increasing
subscriber  demands,  and the  failure to do so could  have a  material  adverse
effect on the  Company's  business.  The  Company  currently  relies on  several
companies to provide data  communications  access to its service.  Any damage or
failure that causes  interruptions  in operations  could have a material adverse
effect on the Company's business.

     The  Company's  operations  are  dependent  on its  ability to protect  its
computer equipment and the information stored in its data centers against damage
by fire, power loss,  telecommunications  failures,  unauthorized intrusions and
other events.  The Company  believes it has taken prudent measures to reduce the
risk of interruption in its operations.  However, there can be no assurance that
these measures are sufficient.  Any damage or failure that causes  interruptions
in  the  Company's  operations  could  have a  material  adverse  effect  on its
business. While the Company carries property and business interruption insurance
to cover its computer operations, the coverage may not be adequate to compensate
for losses that may occur.

PRESSURES ON OPERATING MARGINS
------------------------------

     The Company has aggressively promoted its service offerings to increase its
market share and achieve growth its  subscriber  base. The Company may implement
other strategies designed to facilitate  subscriber growth. The costs associated
with the rapid growth in its subscriber base and investments in customer support
have placed,  and will continue to place,  pressures on the Company's  operating
margins.

         The Company may adopt  additional  strategies  designed to continue the
growth in its subscriber  base,  such as new marketing  programs and promotional
offers.  Such  strategies  may result in an increase in costs as a percentage of
revenues.  In  addition,  acceleration  in the  growth of its  subscriber  base,
changes in usage patterns among members or continuing investments in content may
also increase costs as a percentage of revenues.  As a result,  the Company does
not believe its  operating  margins have  stabilized.  There can be no assurance
that the  Company's  operating  margins  will not be  adversely  affected in the
future by such strategies or other conditions.


                                       8

<PAGE>

SEASONALITY
-----------

     Subscriber  acquisition  is  expected to be highest in the second and third
calendar quarters, when sales of new computers and computer software are highest
due to the holiday season.  Customer usage is expected to be lower in the summer
months due largely to extended  day light hours and  competing  outdoor  leisure
activities.

MANAGING A RAPIDLY GROWING AND CHANGING BUSINESS
------------------------------------------------

     The  Company  continues  to  experience  major  changes  in its  operations
resulting  from rapid  expansion of its business and other  factors,  which have
placed  significant  demands on its  administrative,  operational  and financial
resources.  The Company's future  performance will depend in part on its ability
to manage its growth and to adapt its administrative,  operational and financial
control systems to the needs of the expanded  entity.  The failure of management
to anticipate,  respond to and manage changing business  conditions could have a
material adverse effect on the Company's business and results of operations.

ACCESS TO CONTENT PROVIDERS
---------------------------

     As competition in the online  services  market  intensifies,  it may become
more  difficult  or  expensive  to secure  and  retain  content  and/ or content
providers.  The Company  generally pays royalties to its content providers under
short term renewable agreements,  and there can be no assurance that the loss of
a number of content  providers  or  significantly  increased  costs to  maintain
certain  content  providers  would  not have a  material  adverse  effect on the
Company's business.

NEW BUSINESSES AND INTERNATIONAL VENTURES
-----------------------------------------

     The Company  pursues new products and services to diversify  its sources of
revenue and leverage its technological and other  competencies.  There can be no
assurance  that the Company  will be able to  successfully  develop,  or achieve
commercial acceptance for, these new products and services.  The Company intends
to offer online services  internationally through either wholly owned operations
or  through  joint  ventures  with  existing   Internet  service   providers  of
telecommunications  companies. There can be no assurance that the Company or its
partners will be able to successfully  market,  sell and deliver its services in
these  markets.  In addition,  there are certain  significant  risks inherent in
doing business on an international  level,  such as laws governing  content that
differ  greatly  from  country to  country,  unexpected  changes  in  regulatory
requirements,  political risks, export restrictions, export controls relating to
encryption  technology,  tariffs  and  other  trade  barriers,  fluctuations  in
currency exchange rates, issues regarding  intellectual property and potentially
adverse  tax  consequences,  any or all of  which  could  impact  the  Company's
international operations.


                                       9

<PAGE>


CHANGING TECHNOLOGIES
---------------------

     As  online  services  evolve,   the  Company  will  be  required  to  offer
technological  advances such as improved data  compression and delivery of voice
and full motion  video.  Currently,  online  services are accessed  primarily by
personal  computers via modem. As online  services  become  accessible by screen
based telephones,  television or other consumer electronic  devices,  and become
commercially  deliverable  over other wired  conduits  such as coaxial and fiber
optic  cable,  the  Company  may have to develop  new  technology  or modify its
existing  technology  to keep pace with  these  developments.  Pursuit  of these
technological advances will require substantial  expenditures,  and there can be
no  assurance  that the  Company  will  succeed in adapting  its online  service
business to alternate access devices and conduits.

GOVERNMENT REGULATION AND LEGAL UNCERTAINTIES
---------------------------------------------

     Changes in the regulatory  environment  relating to the  telecommunications
and media industry could have an adverse effect on the Company's  business.  The
Company cannot predict the likelihood  that any such  legislation  will pass, or
the financial impact, if any, the resulting regulation may have.  Moreover,  the
applicability  to online service and Internet access  providers of existing laws
governing  issues such as intellectual  property  ownership,  libel and personal
privacy is  uncertain.  The law  relating  to the  liability  of online  service
companies  and  Internet  access   providers  for  information   carried  on  or
disseminated  through  their  systems is  currently  unsettled  and has been the
subject of several  recent  private  lawsuits.  If  similar  actions  were to be
initiated against the Company,  costs incurred as a result of such actions could
have a material adverse effect on the Company's business.

RELIANCE ON KEY PERSONNEL
-------------------------

     The Company's success depends in part upon the performance of its executive
officers and other key employees. The loss of the services of one or more of its
key personnel  could have a material  adverse  effect on the Company.  In August
2000, three directors who also served as executive  officers of the Company were
removed by the vote of a majority vote of the Company's shareholders.  There can
be  no  assurance  that  the  Company  will  be  successful  in  attracting  new
experienced personnel or retaining such personnel.

RELIANCE ON THIRD PARTIES
-------------------------

     The Company depends  substantially  upon third parties for several critical
elements  of its  business,  including  revenue  sharing  and  Internet  routing
agreements with  telecommunications  companies and the Company's  agreement with
ZiLOG,  Inc.  pursuant to which ZiLOG, Inc. has agreed to manufacture and supply
MailTV chips to television manufacturers. ZiLOG has informed the Company on June
30, 2000 that it was very  disappointed  with the progress of the MailTV product
and that until further notice, although it will continue to supply chips against
firm orders,  it will  otherwise  place the MailTV project on  maintenance.  The
Company's newly appointed  executives have made  arrangements for discussion and
negotiation with ZiLOG which they are hopeful will lead to a  re-instatement  of
full project support of MailTV by ZiLOG.  The Company  proposes to outsource the
manufacture  of its  MAILTV  retrofit  keyboards  from an  outside  manufacturer
pursuant to purchase orders placed from time to time. The Company will not carry
significant  inventories of these  keyboards and will have no guaranteed  supply
arrangements.  The  Company  relies  on  local  telephone  companies  and  other
companies to provide data communications  capacity via local  telecommunications
lines and leased long distance lines.


                                       10

<PAGE>


INTELLECTUAL PROPERTY ISSUES
----------------------------

     The Company regards its patents, patent applications, trademarks, trademark
applications,  trade dress, trade secrets and similar  intellectual  property as
critical to its success,  and the Company  will rely upon patent law,  trademark
law, trade secret protection and confidentiality  and/or license agreements with
its employees, customers, partners and others to protect its proprietary rights.
There can be no assurance  that the steps taken by the Company to protect any of
its proprietary  rights will be adequate or that third parties will not infringe
or misappropriate  the Company's  patents,  trademarks,  trade dress and similar
proprietary  rights.  In addition,  there can be no assurance that other parties
will not assert infringement claims against the Company.

VOLATILITY OF SHARE PRICE
-------------------------

     The market price of the Company's Common Stock has a history of volatility.
Factors such as quarterly  variations in financial results and membership growth
and  usage,   new  pricing   strategies,   the   announcement  of  technological
innovations,  mergers,  acquisitions,  strategic  partnerships  or  new  product
offerings by the Company or its  competitors,  the  entrance of new  competitors
into the online  services  market and  changes in content  providers  may have a
significant impact on the market price of the Common Stock. Moreover, the Common
Stock could experience price volatility based on market conditions.

SALES OF COMMON STOCK
---------------------

     Sales of  substantial  amounts of Common  Stock in the public  market could
adversely affect prevailing market prices of the Common Stock. The warrants that
have been  issued by the  Company  since the  reverse  acquisition  of WWCH have
provided  for  demand  and  piggyback  registration  rights.  Exercise  of  such
registration  rights could increase the number of shares of Common Stock sold in
the public markets.


                                       11


<PAGE>



                               WORLD CALLNET, INC.

                           CONSOLIDATED BALANCE SHEET

                           (Expressed in U.S. Dollars)

                               AS OF JUNE 30, 2000

                                   (Unaudited)
                                    ---------

ASSETS
------
CURRENT ASSETS:
 Cash                                                             $  1,705,103
 Trade accounts receivable, net of allowance for doubtful
   accounts of $368,937                                                137,986
 Prepaid expenses and other current assets                             449,722
                                                                  ------------
        Total current assets                                         2,292,811
                                                                  ------------

OTHER ASSETS:
 Investment in marketable equity securities                            326,563
 Furniture and equipment, net at cost                                  495,305
 Goodwill, net of accumulated amortization of $821,500               4,001,565
 Other intangible assets, net                                          157,178
 Bonds, deposits and other assets                                      215,262
                                                                  ------------
        Total other assets                                           5,195,873
                                                                  ------------
                                                                  $  7,488,684
        Total assets                                              ------------


LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
CURRENT LIABILITIES:
 Accounts payable and accrued expenses                               3,443,943
                                                                  ------------
        Total current liabilities                                    3,443,943
                                                                  ------------
STOCKHOLDERS' EQUITY:
 Preferred stock, $0.001 par value; 10,000,000 shares
   authorized, no shares issued or outstanding                              --
 Common stock, $0.001 par value; 100,000,000 shares authorized:
   18,171,304 shares issued and 17,671,304 shares outstanding           18,171
 Additional paid-in capital                                         19,643,430
 Accumulated deficit                                               (15,068,303)
 Treasury stock, 500,000 shares, at cost                              (482,000)
 Valuation allowance for investment securities                        (401,343)
 Foreign currency translation adjustment                               334,786
                                                                  ------------
        Total stockholders' equity                                   4,044,741
                                                                  ------------
        Total liabilities and stockholders' equity                $  7,488,684
                                                                  ============


              See accompanying notes to these financial statements.


                                       12

<PAGE>

<TABLE>

<CAPTION>



                               WORLD CALLNET, INC.

                      CONSOLIDATED STATEMENT OF OPERATIONS

                           (Expressed in U.S. Dollars)

           FOR THE THREE AND NINE MONTHS ENDED JUNE 30, 2000 AND 1999

                                   (Unaudited)


                                             Three Months                     Nine Months
                                                Ended                            Ended
                                               June 30,                         June30,

                                        2000             1999            2000            1999
                                   ------------    ------------    ------------    ------------
<S>                                <C>             <C>             <C>             <C>
REVENUES                           $    350,261    $     38,886    $  1,283,801    $    157,363


COSTS AND EXPENSES:
   Production and development         2,170,544           2,385       4,046,399           2,385
   General and administrative         3,159,678         537,602       6,200,397       1,447,547
   Interest expense                        --           119,943         252,591         194,762
   Depreciation and amortization        317,037           7,661         881,741           9,561
                                   ------------    ------------    ------------    ------------
                                      5,647,259         667,591      11,381,128       1,654,255
                                   ------------    ------------    ------------    ------------

NET LOSS                           $ (5,296,998)   $   (628,705)   $(10,097,327)   $ (1,496,893)
                                   ============    ============    ============    ============

NET LOSS PER SHARE                 $       (.30)   $       (.08)   $       (.68)   $       (.20)
                                   ============    ============    ============    ============

WEIGHTED AVERAGE SHARES              17,494,299       7,989,000      14,886,724       7,493,000
                                   ============    ============    ============    ============
</TABLE>


              See accompanying notes to these financial statements.


                                       13


<PAGE>

<TABLE>

<CAPTION>




                      CONSOLIDATED STATEMENT OF CASH FLOWS

                           (Expressed in U.S. Dollars)

                FOR THE NINE MONTHS ENDED JUNE 30, 2000 AND 1999

                                   (Unaudited)

                                                                            2000            1999
                                                                       ------------    ------------
<S>                                                                    <C>             <C>
 CASH FLOWS FROM OPERATING ACTIVITIES:
   Net loss                                                            $(10,097,327)   $ (1,496,893)
   Depreciation and amortization expense                                    881,741           9,561
   Amortization of debt issuance costs                                      195,049         132,507
   Issuance of common stock for services                                     90,000            --
   Decrease in receivables                                                    9,571            --
   Increase in prepaid expenses and other current assets                   (350,563)        (63,252)
   Increase in accounts payable and accrued expenses                      1,950,356         338,883
   Changes in currency translation and other                                557,096          15,469
                                                                       ------------    ------------
               Net cash used by operating activities                     (6,764,077)     (1,063,725)
                                                                       ------------    ------------

CASH FLOWS FROM INVESTING ACTIVITIES:
  Increase in amount due from affiliate                                        --          (644,573)
  Purchase furniture and equipment                                        (411,751)        (66,053)
                                                                       ------------    ------------
               Net cash used by investing activities                       (411,751)       (724,207)

CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from short-term indebtedness, net of financing costs                 --        1,630,000
  Repayment of short-term indebtedness                                     (562,500)            --
  Cash received in common stock issuances and subscriptions               9,229,188         167,560
                                                                       ------------    ------------
               Net cash provided by financing activities                  8,666,688       1,797,560
                                                                       ------------    ------------

NET INCREASE IN CASH                                                      1,490,860           9,628

CASH, beginning of period                                                   214,243           1,995
                                                                       ------------    ------------

CASH, end of period                                                    $  1,705,103    $     11,623
                                                                       ============    ============
NON CASH TRANSACTIONS:
 Purchase of net assets in reverse acquisition for common stock        $        --     $     14,872
 Acquisition of CallNet Plc shares for common stock                             --          500,000
 Increase in investments from MailTV shares received                       162,500            --
 Repayment of notes payable and accrued interest with common stock        1,195,000            --
                                                                       ------------    ------------
                                                                       $  1,357,500    $    514,872
                                                                       ============    ============
</TABLE>

              See accompanying notes to these financial statements.


                                       14

<PAGE>



                               WORLD CALLNET, INC.

              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

                            Expressed in U.S. Dollars

1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
   ------------------------------------------------

   Organization and Nature of Operations
   -------------------------------------
   World CallNet,  Inc. (the  "Company") is  incorporated in the United Kingdom.
   The Company is primarily engaged in developing  proprietary  Internet devices
   and  software  applications,  developing  commercial  Internet  websites  and
   operating a pay-as-you-go  Internet  service  provider.  Primarily all of the
   Company's  operations  and customers are located in the United  Kingdom as of
   June 30, 2000.

   Unaudited Information
   ---------------------
   The  consolidated  balance  sheet  as of June 30,  2000 and the  consolidated
   statements of operations  for the three and nine month periods ended June 30,
   2000 and 1999 were taken from the Company's  books and records without audit.
   However,  in  the  opinion  of  management,  such  information  includes  all
   adjustments   (consisting  only  of  normal  recurring  accruals)  which  are
   necessary  to properly  reflect the  consolidated  financial  position of the
   Company as of June 30, 2000 and the results of  operations  for the three and
   nine months ended June 30, 2000 and 1999.

   The accompanying financial statements include the accounts of the Company and
   its two wholly owned subsidiaries,  CallNet Plc and Overleaf Systems, Limited
   ("Overleaf").  Overleaf has been inactive to date. All  significant  balances
   and transactions have been eliminated in  consolidation.  The foregoing notes
   to  these  financial  statements  include  only  the  information   regarding
   transactions  and events that occurred  during the nine months ended June 30,
   2000. These notes should be read in conjunction with the notes to the audited
   September 30, 1999 financial statements.

2. TRANSACTION WITH MAILTV
   -----------------------

   In September 1999, the Company entered into an agreement with MailTV Pty Ltd.
   ("MailTV"),  an  Australian  company,  in which  MailTV is to  acquire  up to
   14,500,000  shares of the  Company's  common  stock in two phases.  The first
   phase involved the Company  exchanging  2,900,000  shares of its common stock
   for $2,718,750 in cash and 453,125 shares of  KeyClub.net,  a publicly traded
   company  affiliated  with MailTV.  This phase  closed on September  30, 1999,
   although  $1,765,530  of the cash was  received  in  installments  that  were
   completed in January 2000.

   The second phase resulted in the Company  exchanging  1,243,915 shares of its
   common stock for $1,166,170 in cash and 200,000 shares of  KeyClub.net.  As a
   result of assessment by the Company of stock trading  prices of  KeyClub.net,
   Inc.  shares  since  January  2000,  the  Company  has  provided a  valuation
   allowance of $401,343 on its investment in KeyClub.net,


                                       15

<PAGE>

                               WORLD CALLNET, INC.

              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

                            Expressed in U.S. Dollars






   Inc. shares.  The valuation  allowance reflects an adjustment to the carrying
   value of the KeyClub.net shares to equal $.50 per share.

   Management does not currently  believe the reduction in value is permanent in
   nature and has recorded it as a component of stockholders' equity.

3. NOTES PAYABLE
   -------------

   In October and December  1999,  the Company  repaid in cash $550,000 of notes
   payable,  plus  accrued  interest to three note  holders.  On March 31, 2000,
   $1,137,500 of the remaining  $1,150,000 notes payable,  plus accrued interest
   of $57,500 was repaid  through the issuance of the Company's  common stock to
   the note holders.  Stock  purchase  warrants  covering  487,500 shares of the
   Company's  common  stock  were  exercised  at $1.00 per  share and  remaining
   principal  and accrued  interest  was repaid  through the  issuance of common
   stock at $1.75 per share. A total of 891,787  shares of the Company's  common
   stock were issued in the exchange and warrant  exercises by the note holders.
   During April 2000,  the  remaining  outstanding  $12,500 of notes payable was
   repaid  in cash.  As of June 30,  2000,  1,187,500  stock  purchase  warrants
   applicable to the notes payable remained outstanding.

4. STOCKHOLDERS' EQUITY
   --------------------

   In January  2000,  the Company  completed a private  placement  of  1,350,000
   shares of its common stock for total  proceeds of $ 2,362,500.  In connection
   with the placement,  the Company paid a cash commission of $37,100 and issued
   150,000 shares of its common stock.

   On February 24,  2000,  the  Company's  stockholders  approved the  following
   proposals:

   o     An amendment to the Company's  Stock Option Plan to increase the number
         of shares to be issued under such plan from 1,000,000 to 3,000,000.

   o     An amendment to the Company's  Second Amended and Restated  Certificate
         of Incorporation to increase the authorized  number of shares of common
         stock from 30,000,000 to 100,000,000.

   On April 19, 2000, the Company  completed the private placement of $3,981,112
   of its common stock at $4.00 per share. In connection with the offering,  the
   Company paid a cash  commission  of $112,500 and is obligated to issue 28,125
   shares of its common stock.


                                       16

<PAGE>



                           PART II - OTHER INFORMATION

Item 1.  Legal Proceedings.

Not applicable.


Item 2.  Changes in Securities.

Not Applicable


Item 3.  Defaults on Senior Securities.

Not applicable.


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

Not applicable.


Item 5.  Other Information.

On August 1, 2000,  Company  shareholders  representing  in excess of 50% of the
Company's  voting stock resolved to dismiss the Company's  executive  directors,
Mr. Paul Goodman-Simpson, Mr. Aaron Goodman-Simpson and Mr. Keith Goodyer.

Mr. John  Kahlbetzer,  Mr. Graham Avery and Mr. Peter Cordas were elected as new
directors.  At a Board of Directors  Meeting  following,  Mr. Gerard Farley,  an
existing  non-executive  director was appointed  Company  President,  Mr. Graham
Avery was appointed  Chairman and Chief  Executive  Officer and Mr. Peter Cordas
was appointed as Vice President Corporate Finance. Mr. Peter Boonen continues as
a director of the Company.

The Action by Shareholders Without Meeting was in accordance with Section 228 of
the  Delaware  Corporations  Code and Section 11 of Article II of the By-laws of
the Corporation.


                                       17

<PAGE>


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

(a)      Exhibits.

         3.1      Certificate of Amendment to the  Certificate of  Incorporation
                  of the Company,  which is incorporated by reference  herein as
                  Exhibit 3.1 to the Company's Form 8-K, dated January 5, 1999.

         3.2      Amendment  to  Second  Amended  and  Restated  Certificate  of
                  Incorporation,  which is incorporated  by reference  herein as
                  Exhibit 3.2 to the Company's Form 10-QSB, dated May 22, 2000.

         3.2      By-laws of the Company,  which are  incorporated  by reference
                  herein as Exhibit 3(ii) to Form 10 filed on March 26, 1997.

         27.1     Financial Data Schedule.

(b)      Reports on Form 8-K.

         None filed.


                                       18

<PAGE>




                                   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.

                                               WORLD CALLNET, INC.
                                               -------------------
                                                   (Registrant)


                                               /s/ Gerard Farley
                                               ---------------------------------
                                               Gerard Farley, President and
                                               Director

                                               Date: August 21, 2000



                                               /s/ Graham Leigh
                                               ---------------------------------
                                               Graham Leigh, Principal Financial
                                               and Accounting Officer

                                               Date: August 21, 2000


                                       19