MIDLAND INC
10QSB, 1997-09-02
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             SECURITIES AND EXCHANGE COMMISSION
                    Washington, D.C. 20549

                          FORM 10-QSB
(Mark One)

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

For the quarterly period ended:  March 31, 1997

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: 0 24736

                        Midland, Inc.
(Exact name of small business issuer as specified in its charter)

     Colorado                               84 107820
(State or other jurisdiction of         (I.R.S. employer
  incorporation or organization)      identification number)

12528 Kirkham Court, Nos. 6 & 7 Poway, CA           92064
 (Address of principal executive offices)        (Zip Code)

Issuer's telephone number, including area code: (619) 679 3290

Indicate by check mark whether the issuer (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.  Yes     X    No

Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date:  As of
August 15, 1997, there were approximately 2,239,170 common shares
and 63,000 Series A preferred shares outstanding.


I.  PART I -  FINANCIAL INFORMATION

Item 1.  Financial Statements

                          MIDLAND, INC.
                         BALANCE SHEETS




                                March 31,         December 31,
                                   1997              1996
                               (Unaudited)

ASSETS

CURRENT ASSETS 
Cash                           $   108,511        $    2,688
Accounts receivable, no
 allowance deemed necessary         33,809            58,424
Inventories                              -             5,000
Prepaid expense and other           50,455            27,487

TOTAL CURRENT ASSETS               192,775            93,599

PROPERTY AND EQUIPMENT, net         30,027            25,795

OTHER ASSETS
License agreement, net             129,173           131,250
Slotting fee, net                        -            41,448

TOTAL OTHER ASSETS                 129,173           172,698
                               $   351,975       $   292,092

LIABILITIES AND STOCKHOLDERS' DEFICIT

CURRENT LIABILITIES
Accounts payable               $   529,925       $   512,500
Bank overdraft                           -            76,822
Accrued expenses                   102,020           239,194
Current portion of long term debt  239,194           109,614

TOTAL CURRENT LIABILITIES          871,139           938,130

LONG TERM DEBT, less
  current portion                   24,199            25,375

STOCKHOLDERS' DEFICIT
Preferred stock, $0.40 par value
  (1,000,000 shares authorized,
   54,000 issued and
   outstanding December 31, 1996,
   and March 31, 1997,
   respectively)                    21,600            21,600

Common stock - $.40 par value
  (10,000,000 shares authorized,
  845,565 issued and outstanding
  as of December 31, 1996,
  and March 31, 1997,
     respectively)                 338,226           338,226
Additional paid-in-capital       1,183,146           940,366
Accumulated deficit             (2,086,335)       (1,971,605)

TOTAL STOCKHOLDERS' DEFICIT      (543,363)         (671,413)

                             $    351,975      $    292,092


                           MIDLAND, INC.
                    STATEMENTS OF OPERATIONS
                            (UNAUDITED)

For the three months ended March 31, 1997, and March 31, 1996,
respectively

SALES                        $     19,329       $     616,581

COST OF SALES                       6,844             245,582

Gross profit                       12,485             370,999

OPERATING EXPENSES
General and administrative
      expenses                    120,125             582,004
Depreciation                        3,550               4,943

TOTAL OPERATING EXPENSES          123,675             586,947

LOSS FROM OPERATIONS             (111,190)           (215,948)

OTHER INCOME (EXPENSES)
Interest                           (2,740)                  -
Other                                   -              (8,545)

TOTAL OTHER INCOME (EXPENSES)      (2,740)             (8,545)

LOSS BEFORE INCOME TAXES         (113,930)           (224,493)

Provision for income tax              800                   -

NET LOSS                        $(114,730)          $(224,493)

Net loss per common share       $    (.14)          $    (.26)

Weighted average number of
        shares outstanding        845,565             857,005


                           MIDLAND, INC.
                    STATEMENTS OF CASH FLOWS
                           (UNAUDITED)

                                       For the three months
                                         ended March 31,
                                           1997       1996

CASH FLOWS FROM OPERATING ACTIVITIES
Net loss                                $(114,730)   $(224,493)

Adjustments to reconcile net loss
   to net cash used in operating
   activities:
Depreciation                                3,550        4,943
Amortization of license agreement
   included in costs of goods sold              -       19,543
Gain on sale of property and equipment     (7,782)           -

Changes in operating assets and
   liabilities:
Accounts receivable                        24,615       13,590
Inventory                                   5,000       16,341
Prepaid expenses                          (22,968)     (22,646)
Other assets                               43,525       (3,165)

Increase (decrease) in:
Accounts payable                           17,425      (37,105)
Accrued expenses                         (137,174)      27,874
Bank overdraft                            (76,822)           -

NET CASH USED IN OPERATING ACTIVITIES    (265,361)    (205,118)

CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property and equipment             -     (111,558)

CASH FLOWS FROM FINANCING ACTIVITIES

Payments on long-term debt                 (1,176)     (45,000)
Net proceeds from long-term debt          129,580      262,000
Proceeds from convertible debt                  -       69,637
Proceeds from additional paid-in-capital  242,780            -

NET CASH PROVIDED BY FINANCING ACTIVITIES 371,184      286,637

NET INCREASE (DECREASE) IN CASH           105,823      (30,039)

CASH, BEGINNING OF PERIOD                   2,688       32,727

CASH, END OF PERIOD                     $ 108,511  $     2,688


                          MIDLAND, INC.
                Notes to Financial Statements
                           (Unaudited)

In the opinion of management, all adjustments (consisting of normal
recurring adjustments) considered necessary for a fair presentation
of the financial condition of registrant have been included, and
the disclosures are adequate to make the information presented not
misleading.

Note 1.  A summary of significant accounting policies is currently
on file with the U.S. Securities and Exchange Commission in
registrant's Form 8-A.

Note 2.  The loss per share was computed by dividing net loss by
the weighted average number of shares of common stock outstanding
during the period.

Note 3.  Registrant has not declared or paid dividends on its
common shares since inception.

Note 4.  The accompanying unaudited financial statements have been
prepared in accordance with the instructions to Form 10-Q and do
not include all information and footnotes required by generally
accepted accounting principles for complete financial statements.

Note 5.  Income taxes have not been provided for in that registrant
has not had a tax liability from inception to the date of these
notes.

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

Results of Operations:

Failure of Coffee Business:

The Company, during 1996, was engaged in the sale of gourmet
coffee, related products and accessories through service
concessions located in a chain of grocery stores in Southern
California.  The Company owned and operated service concessions,
almost all of which were located in one supermarket chain in
Southern California, Ralph's. Beginning in late October, 1996, the
Company began to experience difficulties in its relationship with
Ralphs, the result of which was that Ralphs refused to pay the
Company for the coffee which the Company was selling to Ralphs,
which, in turn, caused the Company to default on its obligations to
Daymar and also to Restaurant Blend, which, in turn, resulted in
the Company being unable to deliver coffee to Ralphs and its other
sales outlets, which, in turn, resulted in Ralphs and the Company's
other sales outlets notifying the Company of their intention to
terminate their respective relationships.  The Company negotiated
a settlement with Ralphs in February, 1997, whereby their contract
was mutually terminated.  Ralphs kept the slotting fees paid by the
Company and the Company was relieved of all liabilities claimed by
Ralphs.  Subsequently, the Company settled all liabilities with
Brothers, Daymar, Restaurant Blend and most, if not all, of its
others creditors; however, the Company is presently in default of
many of the settlement agreements which it reached with these
entities.

Secondary Offering:

The Company, on August 14, 1996, completed a secondary offering to
the public of 54,000 units (Units), each Unit consisting of one
share of Series A Preferred stock (Series A Preferred Stock) and
fifty Redeemable Common Stock Purchase Warrants (Series A
Warrants). The Series A Preferred Stock and the Series A Warrants
are now being traded separately.

The Series A Preferred Stock will automatically convert into
thirty-five shares of Common Stock on October 1, 1998.  Since the
Company failed to have $300,000 of pre-tax earnings for the twelve
months ended June 30, 1997 and did not trade for at least $2.50 for
ten days between June 30, 1997, and August 15, 1997, the Company
will declare a dividend on each share of Series A Preferred Stock
of one-tenth share of Series A Preferred Stock and five Series A
Warrants. The Company will declare a similar dividend on the Series
A Preferred Stock unless the Common Stock trades above $2.50 per
share for 20 consecutive days after August 14, 1997, but before
August 15, 1998, and the Company fails to have pre-tax earnings of
$450,000, exclusive of extraordinary and non-recurring items. Each
share of Series A Preferred Stock is entitled to thirty-five votes
on each matter submitted to a vote to the Common Stock as if the
two classes constituted one class; however, the approval of the
holders of two-thirds of the outstanding Series A Preferred Stock
is required to: (i) amendment or repeal or revise the Company's
Certificate of Incorporation if such action would alter the
preferences, rights, privileges, or powers of, or the restrictions
provided for the benefit of, the Series A Preferred Stock; (ii)
authorize, create or issue any security having any preference or
priority superior to any preference or priority of the Series A
Preferred Stock or securities convertible into a security having
such preferences; (iii) reclassify any Common Stock into shares
having any preferences or priority as to dividends or assets
superior to that of the Series A Preferred Stock; or (iv) make any
provision in the Company's Bylaws fixing special qualifications of
those who may be holders of Series A Preferred Stock or any
restriction upon the right to transfer or hypothecate such shares. 
In the event the Company is liquidated, dissolved or wound up, the
Company is required to pay out of the Company's assets $21.00 per
share of Series A Preferred Stock before any payment may be made to
holders of the Common Stock. If the assets of the Company are
insufficient to pay this amount, the assets will be distributed
ratably among the holders of the Series A Preferred Stock.  The
Series A Preferred Stock also contains provisions that protect the
holders against dilution by adjustment of the conversion price in
certain events such as stock dividends paid on Common Stock and
distributions, stock splits, recapitalizations, mergers or
consolidations and certain issuances below the fair market value of
the Common Stock.  Each A Warrant entitles the holder to purchase
one share of Common Stock at a price of $1.00 per share. The
Warrants are currently exercisable until August 14, 2001, unless
earlier redeemed. The Series A Warrants are redeemable by the
Company at $.05 each on 30 days' notice at any time if the closing
bid price per share of Common Stock for ten consecutive trading
days' prior to the date notice of redemption is given equals or
exceeds $2.50 per share. In the event the Company gives notice of
its intention to redeem, a holder would be forced either to
exercise his or her Series A Warrant within 30 days after the date
of notice or accept the redemption price.  The exercise price of
the Series A Warrants may be reduced at any time from time to time
in the discretion of the Board of Directors when it appears to be
in the best interests of the Company to do so.  Any such reduction
would impair the value to holders exercising their Warrants prior
to the effective date of the reduction.  The Series A Warrants
contain provisions that protect the holders against dilution by
adjustment of the exercise price in certain events, such as stock
dividends and distributions, stock splits, recapitalization,
mergers or consolidations and certain issuance's below the fair
market value of the Common Stock. The Company is not required to
issue fractional shares upon the exercise of a Series A Warrant.
The holder of a Series A Warrant will not possess any rights as a
stockholder of the Company until such holder exercises the Series
A Warrant.

The Company also delivered in exchange for nominal consideration
warrants to the underwriter in connection with the offering
allowing it to acquire Units at 120% of the public offering price
for a four-year period which began on August 14, 1996. 

Mega-Hell and Mill Agro Acquisitions:

On February 18, 1997 (the Closing Date), the Company executed,
delivered and closed under a Plan and Agreement of Purchase (the
Purchase Agreement) with the shareholders (the Shareholders) of
MILL-AGRO (HELLAS) SA, a Panamanian company, and  MEGAHEL NAUTICAL
SA,  a Greek company (both of which business entities are
collectively referred to herein as the Subsidiaries), whereby the
Company acquired from the Shareholders all of the outstanding
proprietary interest of these entities, thereby making them
wholly-owned subsidiaries of the Company.  This acquisition was
subsequently rescinded.

Liquidity and Capital Resources:

The Company presently has, and during the period of this report,
had no source of liquidity or capital, other than such liquidity as
resulted from the exercise of outstanding warrants and the receipt
of proceeds therefrom.

                   PART II - OTHER INFORMATION

Item 1.  Litigation

There is no pending litigation to which the Company is presently a
party which has not been satisfied prior to the date of this
filing, and which is required to be disclosed under this item,
other than the following: Matossian and Fidiparex S.A.:  In
December of 1995 counsel for Robert Matossian and Fidiparex S.A.
demanded rescission of and subsequent conversion into Common Stock
of notes which the Company had entered into with certain affiliates
of a former director of the Company, Mr. Mark S. Pierce, on
December 30, 1994, alleging, among other claims, breach of
fiduciary duty to the Company by Messrs. Robert W. Marsik and
Pierce.  The notes were converted into Common Stock on August 17,
1995.  Mr. Matossian was a consultant to the Company from June 1,
1993, until July 31, 1995, when his consulting agreement was
terminated by the Company.  Mr. Matossian was also a director of
the Company with Messrs. Pierce and Marsik during the time that the
notes were entered into and the conversion of the notes effected. 
Matossian, through various nominees on his behlaf, filed suit
purportedly on behalf of the Company against Messrs. Pierce and
Marsik essentially reiterating the foregoing points.  The suit was
filed in the San Diego, California, Superior Court (Case No.
704105).  Messrs. Pierce and Marsik and the Company filed
counter-claims against Mr. Matossian and his nominees alleging
breach of contract and fiduciary duty to the Company, securities
fraud and other related claims.  The Company is of the opinion that
Matossian has no claims, and has been advised by independent
counsel that the claims of Matossian are frivolous and groundless
and initiated solely for the purpose of attempting to interpose
corporate black mail to gain a pecuniary settlement.  Matossian had
previously offered to settle his so-called claims for 260,000
shares of Common Stock and $162,500 in cash.

Office Park Litigation:  In March, 1997, the Company was sued by
the owner of the office park facility in which its Los Angeles
operations were located.  The suit claims that the Company has
breached the lease, and seeks damages for rent from the date of the
claimed breach, December, 1996, through the end of the lease in
September, 1998.  The maximum exposure from the suit approximates
$30,000, and is currently being negotiated for settlement as a part
of the debt restructuring initiated by the Company in the final
quarter of 1996.

Item 2.  Change in Securities

This item is not applicable to the Company for the period covered
by this report.

Item 3.  Defaults Upon Senior Securities

This item is not applicable to the Company for the period covered
by this report.

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

There were no meetings of security holders during the period
covered by this report; thus, this item is not applicable.

Item 5.  Other Information

There is no additional information which the Company is electing to
report under this item at this time.
Item 6.  Exhibits and Reports on Form 8-K

None.

                           SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized this 2nd day of September, 1997.

MIDLAND, INC.
(Registrant)

By  /s/ Robert W. Marsik
       Robert W. Marsik President
       and Chief Executive Officer



By  /s/ Robert W. Marsik
      Robert W. Marsik, Chief Financial
      and Accounting Officer and Treasurer


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<S>                             <C>
<PERIOD-TYPE>                   3-MOS
<FISCAL-YEAR-END>                          DEC-31-1997
<PERIOD-END>                               MAR-31-1997
<CASH>                                          108511
<SECURITIES>                                         0
<RECEIVABLES>                                    33809
<ALLOWANCES>                                         0
<INVENTORY>                                          0
<CURRENT-ASSETS>                                192775
<PP&E>                                           30027
<DEPRECIATION>                                       0
<TOTAL-ASSETS>                                  351975
<CURRENT-LIABILITIES>                           871139
<BONDS>                                              0
                                0
                                      21600
<COMMON>                                        338226
<OTHER-SE>                                    (903189)
<TOTAL-LIABILITY-AND-EQUITY>                    351975
<SALES>                                          19329
<TOTAL-REVENUES>                                 19329
<CGS>                                             6844
<TOTAL-COSTS>                                     6844
<OTHER-EXPENSES>                                123675
<LOSS-PROVISION>                                     0
<INTEREST-EXPENSE>                              (2740)
<INCOME-PRETAX>                               (113930)
<INCOME-TAX>                                       800
<INCOME-CONTINUING>                           (114730)
<DISCONTINUED>                                       0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                  (114730)
<EPS-PRIMARY>                                    (.14)
<EPS-DILUTED>                                    (.14)
        

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