FORM 10-QSB

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

--------------------------------------------------------------------------------


           [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
                SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)


               for the quarterly period ending: September 30, 1996


--------------------------------------------------------------------------------



                           Telco Communications, Inc.

                        formerly Cody Capital Corporation
--------------------------------------------------------------------------------



    Colorado                                  33-1933 3-D             84-1073083
(Incorporation)                           (Commission Number)       (IRS Number)


4 Normandy Drive, Kenner LA                 (504) 466-7004                 70065
(Address of principal executive offices)   Telephone number           (Zip Code)

--------------------------------------------------------------------------------


Securities registered pursuant to Section 12(b) of the Act:     None

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


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

Not[X] (Indicate by check mark whether if disclosure of delinquent filers
(ss.229.405) is not and will not to the best of Registrant's knowledge be
contained herein, in definitive proxy or information statements incorporated
herein by reference or any amendment hereto.)

As of September 30, 1996, the aggregate number of shares held by non-affiliates
was approximately 2,061,000 shares. Due to the limited market for the Company
securities, no estimate is being supplied herewith of the market value for such
securities.

As of September 30, 1996, the number of shares outstanding of the Registrant's
Common Stock was 49,836,000.

        Telco Communications, Inc. September 30, 1996 Form 10-KSB Page 1

<PAGE>



                          PART I: FINANCIAL INFORMATION
--------------------------------------------------------------------------------



                          Item 1. Financial Statements

     As of September 30, 1996, Management reports the financial information per
attachemt hereto.


                 Item 2. Management's Discussion and Analysis of
                  Financial Condition and Results of Operations

Financial Condition and Results of Operations

     On March 11, 1994, the Federal Bankruptcy Court for the Middle District of
Louisiana appointed a Trustee for the Bankruptcy Estate of the Registrant Telco
Communications, Inc., formerly Cody Capital Corporation, the Court having
converted the case from Chapter 11 to Chapter 7 the preceding day. As a result
of that action, the Trustee in Bankruptcy was placed in control of the affairs
of the Registrant replacing the Board of Directors previously serving.

     On March 26, 1996, upon motion of the Trustee, the Court ordered that the
Corporation be sold to Mr. Miller L. Mays III, with no assets or liabilities
attached thereto. The sale was made pursuant to a Bill of Sale perfected on
April 12, 1996. Mr. Mays was duly appointed and assumed the office of President
and Sole Director of the Issuer and appointed Karl E. Rodriguez to serve as
Secretary, and additional Director.

Liquidity and Capital Resources

     The Issuer has no assets or liabilities, liquidity or capital resources.


--------------------------------------------------------------------------------

                           PART II: OTHER INFORMATION
--------------------------------------------------------------------------------



                            Item 1. Legal Proceedings

                                      None

                          Item 2. Change in Securities

                                      None

                     Item 3. Defaults Upon Senior Securities

                                      None

            Item 4. Submission of Matters to Vote of Security Holders

                                      None

                            Item 5. Other Information

     During the Quarter covered by this Report, the Company had and has no
current business, and has had no operations since its emergence from Bankruptcy
in 1996. During the period from April 1996 until the end of the current quarter
Management has been engaged in the search for new business opportunities without
material results. The Issuer continues to seek new business opportunities,

        Telco Communications, Inc. September 30, 1996 Form 10-KSB Page 2

<PAGE>



including business combinations, associations, joint venture, merger and/or
acquisition programs to achieve profitability for shareholders.

                    Item 6. Exhibits and Reports on Form 8-K

     During the Quarter covered by this Report, the Company filed no Report(s)
on Form 8-K



                                   SIGNATURES


      Pursuant to the requirements of the Securities Exchange Act of 1934, this
Form 10-QSB Report for the Quarter ended September 30, 1996, has been signed
below by the following person on behalf of the Registrant and in the capacity
and on the date indicated.


Dated: July 30, 1997


                           Telco Communications, Inc.

                        formerly Cody Capital Corporation


                                       by







--------------------------------                    ----------------------------
Miller L. Mays III                                             Karl E. Rodriguez
PRESIDENT/DIRECTOR                                           SECRETARY/TREASURER


        Telco Communications, Inc. September 30, 1996 Form 10-KSB Page 3

<PAGE>


                                   Attachment

                              FINANCIAL STATEMENTS


        Telco Communications, Inc. September 30, 1996 Form 10-KSB Page 4

<PAGE>


                           TELCO COMMUNICATIONS, INC.
                           BALANCE SHEETS (UNAUDITED)
              for the fiscal years ended December 31, 1995 and 1994
                and for the Nine Months ended September 30, 1996

<TABLE>
<CAPTION>

                                                                                     December 31,
                                                                September 30,   ----------------------
                                                                    1996          1995          1994
                                                                  --------      --------      --------
<S>                                                               <C>           <C>           <C>
                                     ASSETS

CURRENT ASSETS

          Total Current Assets                                    $    -0-      $    -0-      $    -0-




TOTAL ASSETS                                                      $    -0-      $    -0-      $    -0-
                                                                  ========      ========      ========


                       LIABILITIES & STOCKHOLDERS' EQUITY

STOCKHOLDERS' EQUITY

    Common Stock, $.001 par value; authorized 50,000,000
       shares; issued and outstanding, 2,061,000 shares
       and 49,836,000 shares                                        49,836          2061          2061

    Additional Paid-In Capital                                      51,895        99,670        99,670

    Accumulated Surplus (Deficit)                                 (101,731)     (101,731)     (101,731)
                                                                  --------      --------      --------

Total Stockholders' Equity                                             -0-           -0-           -0-
                                                                  --------      --------      --------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                        $    -0-      $    -0-      $    -0-
                                                                  ========      ========      ========
</TABLE>



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


<PAGE>
                           TELCO COMMUNICATIONS, INC.
             STATEMENTS OF LOSS AND ACCUMULATED DEFICIT (UNAUDITED)
              for the fiscal years ended December 31, 1995 and 1994
                and for the Nine Months ended September 30, 1996



                                                         December 31,
                           September 30,     -----------------------------------
                               1996                1995               1994
                          ---------------    ---------------    ---------------

Revenues                  $           -0-    $           -0-    $           -0-
                          ---------------    ---------------    ---------------

Total Expenses                        -0-                -0-                -0-
                          ---------------    ---------------    ---------------

Net Income (Loss)         $           -0-    $           -0-    $           -0-
                          ===============    ===============    ===============

Loss per Share            $           -0-    $           -0-    $           -0-
                          ===============    ===============    ===============


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

<PAGE>


                           TELCO COMMUNICATIONS, INC.
                       STATEMENTS OF CASH FLOW (UNAUDITED)
              for the fiscal years ended December 31, 1995 and 1994
                and for the Nine Months ended September 30, 1996




                                                             December 31,
                                     September 30,    -------------------------
                                        1996             1995           1994
                                      ---------       ----------     ----------

Operating Activities

   Net Income (Loss)                  $     -0-       $      -0-     $      -0-
                                                                               
                                                                               
Total working capital (used)                -0-              -0-            -0-
                                                                               
Increase (Decrease) in                                                         
   working capital                    $     -0-       $      -0-     $      -0-
                                      =========       ==========     ==========
                                                                  


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

<PAGE>
                           TELCO COMMUNICATIONS, INC.
                   STATEMENT OF STOCKHOLDERS' (DEFICIT) EQUITY
   for the period from inception (December 9, 1987) through December 31, 1987,
         for the years ended December 31, 1988 through December 31, 1995
             and for the nine month period ended September 30, 1996


<TABLE>
<CAPTION>
                                                  Common Stock         
                                         -----------------------------       Additional        Accumulated       Total Stock-
                                          Number of            Par             Paid-In           Surplus       holders' Equity
                                           Shares             Value            Capital          (Deficit)         (Deficit)
                                         -----------       -----------       -----------       -----------       -----------
<S>                                       <C>              <C>               <C>               <C>               <C>        
Inception (December 9, 1987)                       0       $         0       $         0       $         0       $         0

Inception through December
31, 1987: Stock issued for
cash and services                          2,500,000             2,500             2,500                               5,000

Cancellation of shares to meet
dilution requirements of offering         (1,700,000)           (1,700)            1,700

Shares transferred to legal counsel                                                   62

Shares issued in public offering           1,261,000             1,261           124,839

Costs of public offering                                                         (29,531)

Net loss                                                                                              (212)
                                         -----------       -----------       -----------       -----------       -----------
Balances, December 31, 1988                2,061,000             2,061            99,570              (212)          101,419

Warrants issued                                                                     100

Net loss                                                                                           (21,509)
                                         -----------       -----------       -----------       -----------       -----------
Balances, December 31, 1989                2,061,000             2,061            99,670           (21,721)           80,010

Year ended December 31, 1990               2,061,000             2,061            99,670           (21,721)           80,010

Year ended December 31, 1991               2,061,000             2,061            99,670           (21,721)           80,010

Year ended December 31, 1992               2,061,000             2,061            99,670           (21,721)           80,010

Year ended December 31, 1993               2,061,000             2,061            99,670           (21,721)           80,010

Write-Off of bad debt                                                                              (80,010)
                                         -----------       -----------       -----------       -----------       -----------
Year ended December 31, 1994               2,061,000             2,061            99,670          (101,731)                0

Year ended December 31, 1995               2,061,000             2,061            99,670          (101,731)                0

Shares issued upon emergence
from Chapter 7 Bankruptcy                 47,775,000            47,775           (47,775)
                                         -----------       -----------       -----------       -----------       -----------

Balances, September 30, 1996              49,836,000       $    49,836       $    51,895       $  (101,731)      $         0
                                         ===========       ===========       ===========       ===========       ===========
</TABLE>

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


<PAGE>

                           TELCO COMMUNICATIONS, INC.
                          NOTES TO FINANCIAL STATEMENTS
   for the period from inception (December 9 1987) through December 31, 1987,
               for the years ended December 31, 1988 through 1995
                and for the nine months ended September 30, 1996



1-FORMATION AND OPERATIONS OF THE COMPANY

Telco Communications, Inc. (the "Company"), was incorporated Cody Capital
Corporation. under the laws of the State of Colorado on December 9 1987. The
Company was organized to seek out and complete a merger or acquisition of other
companies or businesses. The Company completed a public offering in 1988 in
which it raised a net, after offering expenses, of $96,631. An investment was
made in Telco of Baton Rouge however the Company never realized any return from
that investment and in 1994 it was forced to file for bankruptcy. In 1996 the
Company emerged from bankruptcy with no assets or liabilities and subject to no
litigation, claims, enforcements or proceedings and no business or operations.
As of the date of these statements, the Company continues to be in its
development stage.

2-SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     (a)  BASIS OF ACCOUNTING

          Accounting records of the Company and financial statements are
          maintained and prepared on an accrual basis.

     (b)  FISCAL YEAR

          The Company's fiscal year for accounting and tax purposes is December
          31.

     (c)  CASH EQUIVALENTS

          For Financial Accounting Standards purposes, the Statement of Cash
          Flows, Cash Equivalents include time deposits, certificates of
          deposit, and all highly liquid debt instruments with original
          maturities of three months or less. Whenever cash amount are to be
          included on the Company's Statements of Cash Flow, however, they will
          be comprised exclusively of cash.

3-PROPERTY AND EXECUTIVE COMPENSATION

     (a)  PROPERTY:

          The Company's offices and all of its records are located, without
          cost, 4 Normandy Drive, Kenner, Louisiana.



<PAGE>


                           TELCO COMMUNICATIONS, INC.
                          NOTES TO FINANCIAL STATEMENTS
   for the period from inception (December 9 1987) through December 31, 1987,
               for the years ended December 31, 1988 through 1995
                and for the nine months ended September 30, 1996
                                    continued


     (b)  EXECUTIVE COMPENSATION:

          Since inception, the Company has paid no cash compensation to its
          officers or directors. Officers of the Company will be reimbursed for
          out-of-pocket expenses and may be compensated for the time they devote
          to the Company. In addition, Officers may receive compensation for
          services performed on behalf of the Company. The terms of any such
          compensation will be determined on the basis of the nature and extent
          of the services which may be required and will be no less favorable to
          the Company than the charges for similar services made by independent
          third parties who are similarly qualified. No officer or director is
          required to make any specific amount or percentage of his business
          time available to the Company.

4-STOCKHOLDERS' EQUITY.

The Company, as originally incorporated in Colorado, was authorized to issue
50,000,000 shares of common stock having a par value of $0.001. In December
1987, 2,500,000 shares of Common Stock, were issued in exchange for
organizational costs. 1,700,000 of these shares were rescinded in 1988 and a
public offering of 1,261,000 shares was completed in the same year. In 1996, as
a condition of emergence from bankruptcy, 47,775,000 shares of common stock were
issued.