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<SEC-DOCUMENT>0001010549-05-000363.txt : 20050517
<SEC-HEADER>0001010549-05-000363.hdr.sgml : 20050517
<ACCEPTANCE-DATETIME>20050517165553
ACCESSION NUMBER:		0001010549-05-000363
CONFORMED SUBMISSION TYPE:	10-Q
PUBLIC DOCUMENT COUNT:		4
CONFORMED PERIOD OF REPORT:	20050331
FILED AS OF DATE:		20050517
DATE AS OF CHANGE:		20050517

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			CabelTel International Corp
		CENTRAL INDEX KEY:			0000105744
		STANDARD INDUSTRIAL CLASSIFICATION:	SERVICES-SKILLED NURSING CARE FACILITIES [8051]
		IRS NUMBER:				752399477
		STATE OF INCORPORATION:			NV
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		10-Q
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-08187
		FILM NUMBER:		05839381

	BUSINESS ADDRESS:	
		STREET 1:		1755 WITTINGTON PLACE
		STREET 2:		SUITE 340
		CITY:			DALLAS
		STATE:			TX
		ZIP:			75234
		BUSINESS PHONE:		9724078400

	MAIL ADDRESS:	
		STREET 1:		1755 WITTINGTON PLACE
		STREET 2:		SUITE 340
		CITY:			DALLAS
		STATE:			TX
		ZIP:			75234

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	GREENBRIAR CORP
		DATE OF NAME CHANGE:	19960514

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	MEDICAL RESOURCE COMPANIES OF AMERICA
		DATE OF NAME CHANGE:	19920703

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	WESPAC INVESTORS TRUST
		DATE OF NAME CHANGE:	19900605
</SEC-HEADER>
<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>cabel10q033105.txt
<TEXT>

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

                                    FORM 10-Q

(Mark One)

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

                      For the period ended March 31, 2005

                                       OR

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

                        Commission file number 000-08187

                       CabelTel International Corporation
             (Exact name of Registrant as specified in its charter)

                    Nevada                                       75-2399477
        (State or other jurisdiction of                         (IRS Employer
        Incorporation or organization)                       Identification No.)

1755 Wittington Place, Suite 340, Dallas, Texas                     75234
   (Address of principal executive offices)                      (Zip Code)

Registrant's telephone number, including area code: (972) 407-8400

Securities registered pursuant to Section 12(b) of the Act:
                                                          Name of Each Exchange
     Title of Each Class                                  on Which Registered
Common Stock, $.01 par value                             American Stock Exchange

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

Indicate by check mark  whether the issuer (1) filed all reports  required to be
filed by Section 13 or 15(d) of the  Securities  Exchange Act of 1934 during the
past 12 months (or for such shorter  period that the issuer was required to file
such reports), and (2) has been subject to such filing requirements for the past
90 days.

                                 YES [X] NO [ ]

At April 30, 2005 the issuer had outstanding approximately 977,000 shares of par
value $.01 Common Stock.

<PAGE>

                       CABELTEL INTERNATIONAL CORPORATION

                     Index to Quarterly Report on Form 10-Q
                           Period ended March 31, 2005


Part I: Financial Information..................................................3

   ITEM 1: FINANCIAL STATEMENTS................................................3
      Consolidated Balance Sheets..............................................3
      Consolidated Statements of Operations....................................5
      Consolidated Statements Of Cash Flow.....................................6
      Consolidated Statements Of Cash Flows - Continued........................7
      Notes To Consolidated Financial Statements...............................7
   ITEM 2:  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
            RESULTS OF OPERATIONS..............................................9
   ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK........14
   ITEM 4.  CONTROLS AND PROCEDURES...........................................14

Part II: Other Information....................................................16

   ITEM 6. EXHIBITS...........................................................16
   SIGNATURES.................................................................17




















                                       2
<PAGE>
<TABLE>
<CAPTION>

                          PART I: FINANCIAL INFORMATION


ITEM 1: FINANCIAL STATEMENTS
- ----------------------------

                       CabelTel International Corporation
                           Consolidated Balance Sheets
                             (Amounts in thousands)

                                                           March 31,     December 31,
Assets                                                       2005             2004
                                                          (Unaudited)
                                                         ------------    ------------
<S>                                                      <C>             <C>
Current Assets
   Cash and cash equivalents                             $        671    $      1,352
   Accounts receivable-trade                                    1,297           1,016
   Inventory                                                      179           1,166
   Notes receivable                                               756             856
   Assets held for sale                                         3,023           3,939
   Other current assets, net                                    4,103             710
                                                         ------------    ------------

          Total Current Assets                                 10,029           9,039


Property and equipment, at cost
   Land and improvements                                        2,114           2,114
   Buildings and improvements                                   8,593           9,982
   Equipment and furnishings                                   13,233          12,246
   Assets under construction                                   10,523          11,571
      Proven oil and gas properties (full cost method)          1,281           1,357
                                                         ------------    ------------
                                                               35,744          37,270

   Less accumulated depreciation, depletion and
      amortization                                             (5,442)         (5,172)
                                                         ------------    ------------
                                                               30,302          32,098

Goodwill                                                        8,260           8,339

Other Assets                                                    1,575           1,037
                                                         ------------    ------------

Total Assets                                             $     50,166    $     50,513
                                                         ============    ============
</TABLE>



                                       3
<PAGE>

                       CabelTel International Corporation
                     Consolidated Balance Sheets - Continued
                             (Amounts in thousands)

                                                   March 31,       December 31,
Liabilities and Stockholders' Equity                   2005            2004
                                                    (Unaudited)
                                                   ------------    ------------

Current Liabilities
   Current maturities of long-term debt            $     10,892    $      9,603
   Accounts payable - trade                               7,490           3,887
   Accrued expenses                                       7,685           9,498
   Other current liabilities                                318           1,792
                                                   ------------    ------------

          Total Current Liabilities                      26,385          24,780

Long-term debt                                           19,200          20,263

Other long term liabilities                               1,321           1,557
                                                   ------------    ------------

          Total Liabilities                              46,906          46,600

Minority Interest                                         2,930           2,954

Stockholders' Equity
   Preferred stock Series B                                   1               1
   Preferred stock Series J                               3,150           3,150
   Common stock $.01 par value; authorized,
      4,000,000 shares; shares issued and
      outstanding, 977,000                                   10              10
   Additional paid-in capital                                 4               4
   Accumulated other comprehensive income (loss)            889           1,014
   Retained earnings                                     (3,724)         (3,220)

                                                            330             959
                                                   ------------    ------------

Total Liabilities & Stockholders' Equity           $     50,166    $     50,513
                                                   ============    ============



                                       4
<PAGE>


                       CabelTel International Corporation
                      Consolidated Statements of Operations
                  (Amounts in thousands, except per share data)

                                                          For The Three Month
                                                         Period Ended March 31,
                                                            2005         2004
                                                         ---------    ---------
                                                              (Unaudited)
Revenue
   Cable operations                                      $   2,405    $   2,178
   Real estate operations                                    1,150         --
   Oil and gas operations                                      414         --
                                                         ---------    ---------
                                                             3,969        2,178
                                                         ---------    ---------
Operating expenses

   Cable operation                                           1,872        1,249
   Real estate operations                                      615         --
   Oil and gas operations                                      267         --
   Lease expense                                               575          195
   Depreciation, depletion and amortization                    558          604
   Corporate, general and administrative                     1,633          649
                                                         ---------    ---------
                                                             5,520        2,697
                                                         ---------    ---------

          Operating earnings (loss)                         (1,551)        (519)

Other income (expense)
   Interest income                                              40            3
   Interest expense                                           (827)         (49)
   Loss on foreign exchange transactions, net                 (281)         (54)
   Net gain on sale cable duct                               1,843         --
   Net (loss) on sale of assets                               (118)        (223)
   Other                                                       389          312
                                                         ---------    ---------
                                                             1,046          (11)
                                                         ---------    ---------


Earnings from continuing operations before
   Income taxes and minority interest                         (505)        (530)

Income tax (income) expense                                     14          (18)

Minority interest (income) expense                             (15)          65
                                                         ---------    ---------
   Net earnings (loss) from continuing operations             (504)        (577)
                                                         ---------    ---------

Earnings per share - basic and diluted
   Net earnings (loss) per share                         $   (0.52)   $   (0.59)

Basic weighted average common shares                           977          977

In accordance  with the provisions of the  acquisition  agreement the Company is
required to seek  shareholder  approval  permitting the Series J shareholders to
exchange into 8,788,000  shares of the Company's common stock. The following pro
forma earnings per share assume such exchange has occurred.

Pro forma earnings per share -  basic and diluted
       Net income (loss)                                 $   (0.05)   $   (0.06)

Diluted weighted average common shares                       9,766        9,766



                                       5
<PAGE>
<TABLE>
<CAPTION>

                       CabelTel International Corporation
                      Consolidated Statements Of Cash Flow
                             (Amounts in thousands)

                                                           For the three month
                                                          Period Ended March 31,
                                                            2005           2004
                                                        (Unaudited)    (Unaudited)
<S>                                                     <C>            <C>
Cash flows from operating activities
   Net loss                                             $      (504)   $      (577)
   Adjustments to reconcile net loss to net
      cash used in operating activities
      Depreciation, depletion and amortization                  558            604
      Net loss on foreign currency transactions                 281             54
      Net (gain) loss on sale of assets                      (1,725)           223

      Changes in operating assets and liabilities
         Accounts receivable                                   (314)             9
         Other current and non current assets                 1,321           (314)
         Accounts payable and other liabilities              (2,360)          (682)
                                                        -----------    -----------

      Net cash used in operating activities                  (2,743)          (683)

Cash flows provided by (used in) investing activities
   Proceeds from sale of assets                               1,836           --
   Purchase of property and equipment, net                     --             (992)
                                                        -----------    -----------

      Net cash provided by (used in) investing
            Activities                                        1,836           (992)

Cash flows from financing activities
   Proceeds from borrowings                                   4,047          1,115
   Payments on debt                                          (3,821)          --
                                                        -----------    -----------

      Net cash provided by (used in) financing
            Activities                                          226          1,115

      Net increase (decrease) in cash and                      (681)          (560)
            cash equivalents

   Cash and cash equivalents at beginning of period           1,352          1,420
                                                        -----------    -----------

   Cash and cash equivalents at end of period           $       671    $       860
                                                        -----------    -----------
</TABLE>



                                       6
<PAGE>
<TABLE>
<CAPTION>

                       CabelTel International Corporation
                Consolidated Statements Of Cash Flows - Continued
                             (Amounts in thousands)

                                                                 For the three month
                                                                Period Ended March 31,
                                                                  2005           2004
                                                              (Unaudited)    (Unaudited)
<S>                                                           <C>            <C>
Supplemental Disclosures of Cash Flow Information:

Cash paid for interest                                                661           --
Cash paid for taxes                                                  --                9

Schedule of non cash investing and financing activities:
   Unrealized foreign currency translation loss                      (125)           178
   Purchase of property and equipment vendor financed              (3,119)          --
   Sale of property and equipment for short term receivable         2,179           --
</TABLE>


                   Notes To Consolidated Financial Statements
          For the Unaudited Three Months Ended March 31, 2005 and 2004

Note A: Basis of Presentation

The  accompanying   unaudited  consolidated  financial  statements  include  the
accounts  of  CabelTel   International   Corporation   and  its   majority-owned
subsidiaries   (collectively,   "the  Company").  All  significant  intercompany
transactions and accounts have been eliminated.

The financial  statements  reflect all  adjustments  that are, in the opinion of
management,  necessary to fairly present such information.  All such adjustments
are of a  normal  recurring  nature.  Although  the  Company  believes  that the
disclosures  are  adequate to make the  information  presented  not  misleading,
certain  information  and  footnote  disclosures,  including  a  description  of
significant  accounting  policies  normally  included  in  financial  statements
prepared in accordance  with  accounting  principles  generally  accepted in the
United States of America,  have been condensed or omitted pursuant to such rules
and regulations.

These financial  statements  should be read in conjunction with the consolidated
financial  statements and  accompanying  notes included in the Company's  Annual
Report on Form 10-K for the  fiscal  year ended  December  31,  2004.  Operating
results for the three  month  period  ended  March 31, 2005 are not  necessarily
indicative of the results that may be expected for any subsequent quarter or the
year ended December 31, 2005.


Note B: Notes Receivable

As a result of the sale of two communities in 2001 the Company holds  tax-exempt
notes in the amount of $4,030,000  bearing interest at 9.5%. The notes mature on
April 1, 2032, and August 1, 2031 respectively.  In addition, as the result of a
property  sale in March 2005 the Company  has a $200,000  non  interest  bearing
note.

The  repayment  of the  notes  is  limited  to the cash  flow of the  respective
communities  either from  operations,  refinance or sale. The Company has valued
the notes and accrued  interest at zero and will record any cash received in the
form of interest or principal as income.


                                       7
<PAGE>
<TABLE>
<CAPTION>

Note C: Long-Term Obligations

Long-term debt is comprised of the following (in thousands):

                                                                        March 31,    December 31,
                                                                          2005           2004
                                                                      ------------   ------------
<S>                                                                   <C>            <C>
Notes payable to financial institutions maturing through
2018; fixed and variable interest rates ranging from
5.75% to 11%; collateralized by property, fixtures,
equipment and the assignment of rents                                 $     15,212   $     14,112

Notes payable to individuals and companies maturing
through 2023; variable and fixed interest rates ranging
from 10% to 18% collateralized by real property,
personal property, fixtures, equipment and the
assignment of rents                                                          2,897          5,232

Notes payable to related parties, bearing interest at rates ranging
from 15% to 18%                                                             11,983         10,522

                                                                      ------------   ------------
                                                                            30,092         29,866

Less: current maturities                                                    10,892          9,603
                                                                      ============   ============
                                                                      $     19,200         20,263
</TABLE>


Note D - Net Gain on Sale of Cable Duct

The fiber optic  backbone  that  CableTEL AD is  constructing  consists of three
separate  and  independent  fiber optic ducts and CableTEL AD only needs one for
its operations. The other two ducts have been constructed to sell to independent
third  parties.  CableTEL AD has a contract for the sale of one duct for a total
price of  approximately  $13,000,000  and is recording  the sale and the related
gain as various segments of the duct are completed and turned over to the buyer.
CableTEL  AD recorded a sale of  approximately  $1,800,000  in 2004.  During the
three months  ended March 31, 2005  CableTEL AD  delivered  another  segment and
recorded a sale of $4,200,000 and a gain of $1,843,000.  It is anticipated  that
CableTEL AD will record the balance of the contract during the remainer of 2005





                                       8
<PAGE>
<TABLE>
<CAPTION>

NOTE E - SEGMENT REPORTING


Business Operations

The Company operates three separate distinct businesses

         o        The  Company's   principal   business  is   telecommunications
                  activities  in Bulgaria and  surrounding  countries  including
                  subscription cable television,  fixed voice telephony services
                  and data services.

         o        The  ownership  and  operation  of  real  estate  through  one
                  retirement  community in King City, Oregon, with a capacity of
                  114 residents, leasing of a residential retirement property to
                  a third party in Greenville,  South Carolina and ownership and
                  operation  of  an  outlet  mall  in  Gainesville,  Texas  with
                  approximately  315,000  square feet of retail space  available
                  for lease.

         o        The  ownership  of oil  and  gas  leases  in  Gregg  and  Rusk
                  Counties,  Texas on which 48 producing wells were operating as
                  of March 31, 2005.

The segment information and reconciliation to income (loss) from operations that
follows includes the Bulgarian  telecommunications  activities and US operations
for the three months ended March 31, 2005.  For the three months ended March 31,
2005 the Bulgarian telecommunication was the only segment of the Company.


Three months ended March 31, 2005 (amounts in thousands)


                                                                      Real          Oil       Consolidated
                                            Cable      Corporate      Estate     Operation        CIC
                                          ----------------------------------------------------------------
Revenue                                       2,405         --          1,150          414           3,969
                                          ----------------------------------------------------------------
<S>                                       <C>          <C>          <C>          <C>          <C>
Operating expenses
   Cable operations                           1,872         --            615          267           2,754
   Lease expense                                344           20          211         --               575
   Depletion, depreciation and
      amortization                              400         --            132           26             558
   Corporate general and administrative       1,366          267         --           --             1,633
                                          ----------------------------------------------------------------
                                              3,982          287          958          293           5,520
                                          ----------------------------------------------------------------

Operating earning  (loss)                    (1,577)        (287)         192          121          (1,551)

Interest Expense                                361          384           82         --               827
(Loss) on sale of assets
                                                            --            (42)         (76)           (118)
Gain on sale of cable duct                    1,843         --           --           --             1,843
Net earnings (loss)                             (37)        (609)          97           45            (504)
Total Assets                                 25,768       11,117       11,862        1,419          50,166
</TABLE>



ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
- -------------------------------------------------------------------
AND RESULTS OF OPERATIONS
- -------------------------


Overview



                                       9
<PAGE>

         In October 2004 the Company  acquired an indirect  subsidiary  CableTEL
AD, which is a cable television operator in the Country of Bulgaria.  At present
CableTEL AD estimates that its cable subscribers  represent  approximately 11.5%
of the market in  Bulgaria.  CableTEL AD also  operates  fixed  voice  telephony
services,  national cable television and provides  internet access data services
primarily in Bulgaria.

         While the Company was the acquirer,  due to the relative  values of the
entities for reporting  purposes this  transaction  is being  accounted for as a
reverse  acquisition.  As a reverse  acquisition,  for  reporting  purposes  the
Company is being accounted for as if it had been acquired  effective  October 1,
2004. For that reason, the following  discussion,  when comparing the results of
operations  for three  months  ended March 31, 2005 with the three  months ended
March 31, 2004 will include  only  CableTEL AD. for the three months ended March
31, 2004.

Critical Accounting Policies and Estimates

         The Company's  discussion  and analysis of its financial  condition and
results  of  operations  are based  upon the  Company's  Consolidated  Financial
Statements,  which have been prepared in accordance with  accounting  principles
generally  accepted in the United  States.  Certain of the Company's  accounting
policies  require  the  application  of judgment in  selecting  the  appropriate
assumptions  for  calculating  financial  estimates.   By  their  nature,  these
judgments are subject to an inherent degree of uncertainty.  These judgments and
estimates are based upon the Company's  historical  experience,  current trends,
and information  available from other sources that are believed to be reasonable
under  the  circumstances,  the  results  of which  form the  basis  for  making
judgments  about the  carrying  value of  assets  and  liabilities  that are not
readily  apparent  from other  sources.  Actual  results  may differ  from these
estimates under different assumptions or conditions.

         The Company  believes the following  critical  accounting  policies are
more  significant to the judgments and estimates used in the  preparation of its
consolidated  financial statements.  Revisions in such estimates are recorded in
the period in which the facts that give rise to the revisions  become known. The
Company's  critical  accounting  policies  relate to and the  evaluation  of the
collectibility  of accounts and notes receivable and the evaluation of potential
impairment of goodwill.

         The Company's  allowance  for doubtful  accounts  receivable  and notes
receivable is based on an analysis of the risk of loss on specific accounts. The
analysis places particular emphasis on past due accounts.  Management  considers
such information as the nature and age of the receivable, the payment history of
the resident, customer or other debtor and the financial condition of the tenant
or other debtor. Our estimate of the required allowance,  which is reviewed on a
quarterly basis, is subject to revision as these factors change.

         The carrying  value of goodwill is reviewed  annually for impairment by
reviewing any events or changes in circumstances such as significant declines in
sales,  earnings  or cash flows or  material  adverse  changes  in the  business
climate  which would  indicate that its fair value may be less than its carrying
value.  If any  impairment  were  indicated as a result of such reviews we would
measure it using a fair value  methodology  on a report unit basis to  determine
the amount of the impairment.



                                       10
<PAGE>

Liquidity and Capital Resources

         At March 31, 2005 the Company had  current  assets of  $10,029,000  and
current  liabilities of $26,385,000.  During the past twenty-one months CableTEL
AD has for the most part  completed  the first fiber optic  backbone in Bulgaria
with connectivity to Turkey, Greece, Romania and Macedonia. The total investment
in the  backbone  will  be  approximately  $30,000,000.  Most  of the  costs  to
construct  the backbone were incurred in 2004 and the first three months of 2005
and were financed both through debt and vendor financing.

         CableTEL AD is constructing  three separate and independent fiber optic
ducts  and only  needs  one for its  operations.  The  other two ducts are being
constructed  for the purpose of sale to independent  third parties.  CableTEL AD
has  sold  one duct for a total  contract  price of  approximately  $13,000,000.
CableTEL AD has recorded approximately  $1,800,000 in 2004 and $4,200,000 in the
first three months of 2005 and  anticipates  recording the balance of $7,000,000
in the  remainder  of  2005.  CableTEL  AD is  actively  pursuing  a sale of the
remaining duct.

         Included in current  liabilities  is a $1,147,000  mortgage loan for an
assisted living community located in South Carolina.  This community was sold in
May 2005 and the cash proceed were sufficient to repay the mortgage.

         Also included in current  liabilities is an obligation of principal and
accrued  interest  of  $2,768,000  the  terms of which  are  similar  to that of
preferred  stock  whereby  the  Company  can  only pay  this  obligation  out of
available earned surplus.

         Future acquisitions by the Company are dependent upon obtaining capital
and financing through various means,  including  financing  obtained from loans,
debt or equity  offerings  and, to the extent  available,  cash  generated  from
operations.  There can be no  assurance  that the Company will be able to obtain
adequate capital to finance its projected growth.


         Cash and cash equivalents at March 31, 2005 were $671,000 compared with
$1,352,000 at December 31, 2004.

         Net cash used by  operating  activities  was  $2,743,000  for the three
months ended March 31, 2005.  During the quarter the Company had a loss net loss
of $504,000.  Included in the first quarter of 2005 was a net gain of $1,843,000
on the sale of an  additional  segment  of the cable duct that  CableTEL  AD has
under contract for sale. The cash from the sale was received in April 2005.

         Net cash provided in investing  activities was $1,836,000 for the three
months ended March 31, 2005.  In March 2005 the Company sold an assisted  living
community  and  received  approximately  $1,760,000.   The  proceeds  were  used
principally  to pay off the  existing  mortgage.  During the three  months ended
March 31, 2005 CableTel AD invested approximately $3,119,000 for the purchase of
equipment   that  upgraded  the  existing  cable   infrastructure   as  well  as
construction of the backbone. This investment was principally vendor financed.



                                       11
<PAGE>

         Net cash flow  from  financing  activities  was  $226,000  in the three
months ended March 31, 2005.  The additional  funds received of $4,047,000  from
financing  activities  during the three  months were  principally  used to repay
existing trade payables and short term debt.

Results of Operations

         The Company  reported a net loss of $504,000 for the three months ended
March 31,  2005,  as compared to a net loss of  $577,000  for the  corresponding
period in 2004

         Revenue from cable operations was $2,405,000 for the three months ended
March 31, 2005, as compared to $2,178,000  for the  corresponding  period in the
prior year.  These revenues are from subscribers for cable services in Bulgaria.
The increase in revenues from 2005 to 2004 is based almost  exclusively  on rate
increases for services.

         For the first three months of 2005 the Company  recorded  $1,150,000 in
revenue  for  its  real  estate  operations  and  $414,000  for  its oil and gas
operation.  The  Company's  retirement  project  is  fully  occupied  and  it is
anticipated  that it will remain so during 2005. The Company's  retail  shopping
mall  was  approximately  76%  occupied  in March  2005.  The oil  operation  is
benefiting from record high prices for crude oil. While our production is stable
we have no control over what prices will be in 2005.

         CATV  operations  expense was  $1,872,000  in the first three months of
2005 as compared to $1,249,000 for the  corresponding  period in the prior year.
The cost of acquiring programming rights for cable product increased by $432,000
in 2005 as compared to 2004. In addition there was an overall  increase in costs
in general in  anticipation  of the backbone  being  completed and more services
being offer.

         For the first  three  months of 2005 the Company  recorded  $615,000 in
expenses  for  its  real  estate  operations  and  $267,000  for its oil and gas
operation.

         Lease expense for the cable  operation was $344,000 in 2005 compared to
$195,000  for the  corresponding  period in the prior year.  The majority of the
lease cost increase is due to increases at the corporate  level. The development
and construction of the backbone and the growth of the overall operation created
a need for larger corporate offices in Bulgaria.

         For the first three  months of 2005 the  Company had lease  expenses of
$231,000 in the United States which was principally  incurred by its real estate
operation.

         Depreciation,  depletion and  amortization for CableTEL AD was $400,000
for the three months ended March 31, 2005 and $604,000 for corresponding  period
in the prior year. The decrease in 2005 is due in part to CableTEL AD's changing
the determination of useful life of certain of its depreciable assets.

         For the first  three  months of 2005 the  depreciation  expense for the
real estate  operation  was $132,000 and the  depletion of the oil operation was
$26,000.

         Corporate  general  and  administrative  expense  for  CableTEL  AD was
$1,191,000  for the three  months  ended  March  31,  2005 and  $650,000  in the



                                       12
<PAGE>

corresponding   period  for  the  prior  year.  The  bulk  of  the  increase  is
attributable either directly or indirectly to increased administrative personnel
in Bulgaria.  Personnel  expenses  increased  by  approximately  $300,000.  This
included  personnel to oversee the  construction  of the backbone and additional
marketing,  accounting and technical personnel.  Professional fees,  principally
accounting and auditing fees,  have increased by  approximately  $200,000 due to
both the increased  scope of the business as well as  additional  costs of being
associated with a publicly traded company in the United States.

         For  the  first  three  months  of  2005  the  corporate   general  and
administrative expense for the United States operation was $267,000.

         Interest  expense  for  CableTEL  AD was  $361,000  for the first three
months of 2005  compared  to $49,000 for the  corresponding  period in the prior
year.  The  increased  interest  expense  was  principally  due to the  cost  of
completing the backbone which was primarily financed with debt.

         For the first  three  months of 2005 the  interest  expense for certain
foreign  corporate  subsidiaries  acquired by the Company as part of the October
14, 2004  acquisition  was  $316,000.  With respect to the U.S.  operations  the
interest  expense  for the real  estate  operation  was  $82,000  and  corporate
interest was $68,000.

         The net loss on foreign exchange  transactions was $281,000 and $54,000
for the  first  three  months  of 2005 and 2004  respectively.  Transactions  in
foreign  currency are accounted for at the exchange rates prevailing at the time
of the  transaction.  Gains or  losses  resulting  from the  settlement  of such
transactions are recognized in the income statement.

         The net gain on the sale of a cable duct by CableTEL AD was  $1,843,000
in the first three months of 2005. The gain in 2004 represents approximately 30%
of the  anticipated  gain on the sale of one of the three ducts in our  backbone
that was sold to a third party. Access to the ducts are being delivered and paid
for in segments.

         The loss on the sale of assets by CableTEL AD in 2004 was $223,000 from
the sale of a  subsidiary.  The loss was  $118,000 in 2005  consisted of $76,000
from the sale of  certain  oil wells and  $40,000  from the sale of an  assisted
living community.

         Other net income  for  CableTEL  AD was  $348,000  for the first  three
months of 2005 and  $312,000 in the  corresponding  period of 2004.  The largest
component of other  income is  penalties  received  from cable  subscribers  and
miscellaneous fees collected by CableTEL AD from various sources.


Inflation

         The  effects  of  inflation  on  the  Company's   operations   are  not
quantifiable.   The  Company's   principal   sources  of  revenues  impacted  by
inflationary increases are monthly fees charged for cable television access. The
principal expense would be wages. Property operations tend to fluctuate.  To the
extent that inflation affects interest rates it would not  significantly  affect
current  borrowings  which are mostly at fixed  rates.  It could  affect  future
borrowings.



                                       13
<PAGE>

Environmental Matters

         Management is not aware of any environmental  liability that would have
a  material  adverse  effect on the  Company's  business,  assets or  results of
operations.


ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
- -------------------------------------------------------------------


Interest Rate Risk

         Nearly  all of the  Company's  debt  is  financed  at  fixed  rates  of
interest.  Therefore,  we have minimal risk from exposure to changes in interest
rates.  The future  growth of the Company is dependent  on obtaining  capital to
grow. Significant increases in interest rates could negatively impact our growth
plans.

Foreign Exchange Risk

         CableTEL AD operates in Bulgaria  and is  currently  exposed to foreign
exchange risk arising from purchase of program rights and equipment from foreign
suppliers and long term debt, both of which are denominated in US dollars.

Liquidity Risk

         CableTEL  AD's growth and  construction  of the backbone  were financed
through  borrowed  funds.  While  the  Company  believes  that  the  sale of the
additional  two ducts in the  backbone,  the  revenue  generated  by the sale of
access to the backbone for  international  calls in the region and positive cash
flow  from  operations  of its cable  network  will  generate  cash to repay its
obligations  or  support  refinancing  when  its  debt  comes  due,  there is no
assurance that these sums will be adequate.


ITEM 4. CONTROLS AND PROCEDURES
- -------------------------------


         As required by Rule 13a-15(b), the Company's management,  including the
principal  executive officer,  chief financial officer and principal  accounting
officer,  conducted an  evaluation  as of the end of the period  covered by this
report, of the effectiveness of the Company's disclosure controls and procedures
as defined in Exchange Act Rule 13a-15(e).  Based on that evaluation,  the chief
executive  officer and the chief financial  officer concluded that the Company's
disclosure  controls and  procedures  were effective as of the end of the period
covered by this report. As required by Rule 13a-15(d), the Company's management,
including the chief executive  officer,  chief  financial  officer and principal
accounting  officer  also  conducted an  evaluation  of the  Company's  internal
controls over financial  reporting to determine  whether any changes occurred in
the fourth fiscal quarter that  materially  affected,  or are reasonably like to
materially  effect,  the Company's  internal  control over financial  reporting.
Based on that evaluation, there has been no such change during the fourth fiscal
quarter.



                                       14
<PAGE>

         It should be noted that any system of controls,  however well  designed
and operated,  can only provide  reasonable and not absolute  assurance that the
objectives  of the system  will be met. In  addition,  the design of any control
system is based in part on certain  assumptions  about the  likelihood of future
events.




















                                       15
<PAGE>

                           PART II: OTHER INFORMATION



ITEM 6. EXHIBITS
- ----------------

Exhibit  31.1 -  Certification  of  Chief  Executive  Officer  Pursuant  to Rule
13a-14(a) or Rule 15d-14(a)

Exhibit  31.2 -  Certification  of  Chief  Financial  Officer  Pursuant  to Rule
13a-14(a) or Rule 15d-14(a)

Exhibit 32.1 -  Certification  of Chief  Executive  Officer and Chief  Financial
Officer Pursuant to Rule 13a-14(b),  18 U.S.C. Section 1350, as Adopted Pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002























                                       16
<PAGE>

                                   SIGNATURES
                                   ----------

Pursuant  to the  requirements  of the  Securities  and  Exchange  Act of  1934,
registrant  has  duly  caused  this  report  to  be  signed  on  its  behalf  by
undersigned, thereunto duly authorized.


                                             CabelTel International Corporation


Date: May 13, 2005                           By: /s/ Gene S. Bertcher
                                                --------------------------------
                                             President & Chief Financial Officer




















                                       17


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31.1
<SEQUENCE>2
<FILENAME>cabel10qsbex311033105.txt
<DESCRIPTION>SECTION 302 CERTIFICATION OF CEO
<TEXT>

                                                                    EXHIBIT 31.1

                            CHIEF EXECUTIVE OFFICER'S
                     RULE 13a-14(a)/15d-14(a) CERTIFICATION


         I, Ronald C. Finley, certify that:

         1) I have  reviewed  this  quarterly  report on Form  10-Q of  CabelTel
International Corporation;

         2) Based on my  knowledge,  this  report  does not  contain  any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made,  not  misleading  with  respect to the period  covered by this annual
report;

         3) Based on my knowledge, the financial statements, and other financial
information  included  in this annual  report,  fairly  present in all  material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this annual report;

         4) The registrant's  other certifying  officer(s) and I are responsible
for establishing and maintaining  disclosure controls and procedures (as defined
in Exchange Act Rules 13-15(e) and 15d-15e) and internal  control over financial
reporting  (as defined in Exchange Act Rules  13a-15(f)  and  15d-15(f)  for the
registrant and have:

                  (a)  Designed  such  disclosure  controls and  procedures,  or
         caused such disclosure controls and procedures to be designed under our
         supervision,  to  ensure  that  material  information  relating  to the
         registrant,  including its consolidated subsidiaries,  is made known to
         us by others within those entities,  particularly  during the period in
         which this annual report is being prepared;

                  (b) Designed such internal  control over financial  reporting,
         or caused such internal control over financial reporting to be designed
         under our supervision,  to provide reasonable  assurance  regarding the
         reliability  of financial  reporting and the  preparation  of financial
         statements for external purposes in accordance with generally  accepted
         accounting principals;

                  (c) Evaluated the effectiveness of the registrant's disclosure
         controls and  procedures  and presented in this report our  conclusions
         about the effectiveness of the controls and procedures as of the end of
         the period covered by this report based on such evaluation; and

                  (d)  Disclosed  in this report any change in the  registrant's
         internal  control over  financial  reporting  that occurred  during the
         registrant's  most recent fiscal quarter that has materially  affected,
         or is reasonably likely to materially affect, the registrant's internal
         control over financial reporting.

         5) The registrant's  other certifying  officer(s) and I have disclosed,
based  on  our  most  recent  evaluation  of  internal  control  over  financial
reporting,  to the registrant's auditors and the audit committee of registrant's
board of directors (or persons performing the equivalent functions):

                  (a) All significant  deficiencies  and material  weaknesses in
         the design or operation of internal  control over  financial  reporting
         which  are  reasonably  likely to  adversely  affect  the  registrant's
         ability to record, process, summarize and report financial information;
         and

                  (b)  Any  fraud,  whether  or  not  material,   that  involves
         management  or  other  employees  who  have a  significant  role in the
         registrant's internal controls.

         Dated: May 13, 2005.

                                        /s/ Ronald C. Finley
                                       -----------------------------------------
                                       Ronald C. Finley, Chief Executive Officer



</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31.2
<SEQUENCE>3
<FILENAME>cabel10qex312033105.txt
<DESCRIPTION>SECTION 302 CERTIFICATION OF CFO
<TEXT>





                                                                    EXHIBIT 31.2

                            CHIEF FINANCIAL OFFICER'S
                     RULE 13a-14(a)/15d-14(a) CERTIFICATION


         I, Gene S. Bertcher, certify that:

         1. I have  reviewed  this  quarterly  report on Form  10-Q of  CabelTel
International Corporation;

         2) Based on my  knowledge,  this  report  does not  contain  any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made,  not  misleading  with  respect to the period  covered by this annual
report;

         3) Based on my knowledge, the financial statements, and other financial
information  included  in this annual  report,  fairly  present in all  material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this annual report;

         4) The registrant's  other certifying  officer(s) and I are responsible
for establishing and maintaining  disclosure controls and procedures (as defined
in Exchange Act Rules 13-15(e) and 15d-15e) and internal  control over financial
reporting  (as defined in Exchange Act Rules  13a-15(f)  and  15d-15(f)  for the
registrant and have:

                  (a)  Designed  such  disclosure  controls and  procedures,  or
         caused such disclosure controls and procedures to be designed under our
         supervision,  to  ensure  that  material  information  relating  to the
         registrant,  including its consolidated subsidiaries,  is made known to
         us by others within those entities,  particularly  during the period in
         which this annual report is being prepared;

                  (b) Designed such internal  control over financial  reporting,
         or caused such internal control over financial reporting to be designed
         under our supervision,  to provide reasonable  assurance  regarding the
         reliability  of financial  reporting and the  preparation  of financial
         statements for external purposes in accordance with generally  accepted
         accounting principals;

                  (c) Evaluated the effectiveness of the registrant's disclosure
         controls and  procedures  and presented in this report our  conclusions
         about the effectiveness of the controls and procedures as of the end of
         the period covered by this report based on such evaluation; and

                  (d)  Disclosed  in this report any change in the  registrant's
         internal  control over  financial  reporting  that occurred  during the
         registrant's  most recent fiscal quarter that has materially  affected,
         or is reasonably likely to materially affect, the registrant's internal
         control over financial reporting.

         5) The registrant's  other certifying  officer(s) and I have disclosed,
based  on  our  most  recent  evaluation  of  internal  control  over  financial
reporting,  to the registrant's auditors and the audit committee of registrant's
board of directors (or persons performing the equivalent functions):

                  (a) All significant  deficiencies  and material  weaknesses in
         the design or operation of internal  control over  financial  reporting
         which  are  reasonably  likely to  adversely  affect  the  registrant's
         ability to record, process, summarize and report financial information;
         and

                  (b)  Any  fraud,  whether  or  not  material,   that  involves
         management  or  other  employees  who  have a  significant  role in the
         registrant's internal controls.

         Dated: May 13, 2005.

                                                  /s/ Gene S. Bertcher
                                                 -------------------------------
                                                 Gene S. Bertcher, President and
                                                 Chief Financial Officer


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32
<SEQUENCE>4
<FILENAME>cabel10qex32033105.txt
<DESCRIPTION>SECTION 906 CERTIFICATION OF CEO & CFO
<TEXT>

                                                                      Exhibit 32

                      OFFICERS' SECTION 1350 CERTIFICATIONS

         The  undersigned  officers of  CabelTel  International  Corporation,  a
Nevada  corporation  (the  "Company"),  hereby  certifies that (i) the Company's
Quarterly Report on Form 10-Q for the period ended March 31, 2005 fully complies
with the  requirements of Section 13(a) of the Securities  Exchange Act of 1934,
and (ii) the  information  contained in the Company's  Quarterly  Report on Form
10-Q for the period  ended  March 31,  2005  fairly  presents,  in all  material
respects,  the financial  condition and results of operations of the Company, at
and for the periods indicated.

         Dated: May 13, 2005.

                                        /s/ Ronald C. Finley
                                       -----------------------------------------
                                       Ronald C. Finley, Chief Executive Officer



                                        /s/ Gene S. Bertcher
                                       -----------------------------------------
                                       Gene S. Bertcher, President and
                                       Chief Financial Officer





</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
