<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>cabel10q063005.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 June 30, 2005

                                       OR

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

                          Commission file number 0-8187

                       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 [ ]

Indicate by checkmark whether the registrant is an accelerated filer (as defined
in Rule 12b-2 of the Act) YES [ ] NO [X]

At August 15, 2005, the issuer had outstanding 977,004 shares of par value $0.01
Common Stock.



<PAGE>

                       CABELTEL INTERNATIONAL CORPORATION
                     Index to Quarterly Report on Form 10-Q
                           Period ended June 30, 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.........................................11
   ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK........14
   ITEM 4.  CONTROLS AND PROCEDURES...........................................15

PART II: OTHER INFORMATION....................................................16

   ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS........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)

                                                        June 30,      December 31,
Assets                                                    2005            2004
                                                       (Unaudited)
                                                      ------------    ------------
<S>                                                   <C>             <C>
Current assets
   Cash and cash equivalents                          $        643    $      1,352
   Accounts receivable-trade                                 2,274           1,016
   Notes receivable                                            606             856
   Inventory                                                 1,924           1,166
   Assets held for sale                                      1,200           3,939
   Other current assets                                      1,346             710
                                                      ------------    ------------

          Total current assets                               7,993           9,039

Property and equipment, at cost
   Land and improvements                                     2,232           2,114
   Buildings and improvements                                8,327           9,982
   Equipment and furnishings                                15,517          12,246
   Assets under construction                                 7,558          11,571
   Proven oil and gas properties (full cost method)          1,278           1,357
                                                      ------------    ------------
                                                            34,912          37,270

           Less accumulated depreciation, depletion
                and amortization                            (5,639)         (5,172)
                                                      ------------    ------------
                                                            29,273          32,098

Goodwill                                                     8,164           8,339

Other assets                                                 1,733           1,037
                                                      ------------    ------------

Total assets                                          $     47,163    $     50,513
                                                      ============    ============
</TABLE>


                                       3
<PAGE>
<TABLE>
<CAPTION>

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

                                                            June 30,      December 31,
Liabilities and Stockholders' equity                          2005            2004
                                                           (Unaudited)
                                                          ------------    ------------
 <S>                                                      <C>             <C>
Current liabilities
   Current maturities of long-term debt                   $      9,327    $      9,603
   Current notes payable                                            41            --
   Accounts payable - trade                                      1,496           3,887
   Accrued expenses                                             15,654           9,498
   Other current liabilities                                       242           1,792
                                                          ------------    ------------

          Total current liabilities                             26,760          24,780

Long-term debt
   Long term debt                                                6,284           9,740
   Long-term debt - related parties                             13,534          10,523
                                                          ------------    ------------
                                                                19,818          20,263
                                                          ------------    ------------

Other long term liabilities                                        455           1,557
                                                          ------------    ------------

          Total liabilities                                     47,033          46,600

Minority Interest                                                2,330           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; 977,000 shares issued and outstanding             10              10
   Additional paid-in capital                                        4               4
   Accumulated other comprehensive income (loss)                   740           1,014
   Retained earnings                                            (6,105)         (3,220)
                                                          ------------    ------------
                                                                (2,200)            959
                                                          ------------    ------------

Total Liabilities & Stockholders' Equity                  $     47,163    $     50,513
                                                          ============    ============
</TABLE>



                                       4
<PAGE>
<TABLE>
<CAPTION>

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

                                                   For The Three Month      For The Six Month
                                                      Period Ended            Period Ended
                                                         June 30,                June 30,
                                                     2005        2004        2005        2004
                                                   --------    --------    --------    --------
                                                       (Unaudited)              (Unaudited)
<S>                                                <C>         <C>         <C>         <C>
Revenue
   Cable Operations                                $  2,831    $  2,241    $  5,236    $  4,419
   Real Estate operations                             1,127        --         2,277        --
   Oil and gas operations                               396        --           810        --
                                                   --------    --------    --------    --------
                                                      4,354       2,241       8,323       4,419
                                                   --------    --------    --------    --------

Operating expenses
   Cable Operations                                   1,992       1,459       3,864       2,708
   Real estate operations                               660        --         1,275        --
   Oil and gas operations                               292        --           559        --
   Lease expense                                        486         240       1,061         435
   Depletion, depreciation and amortization             638         520       1,196       1,124
   Corporate general and administrative               1,722         499       3,355       1,147
                                                   --------    --------    --------    --------
                                                      5,790       2,717      11,310       5,414
                                                   --------    --------    --------    --------

          Operating earnings (loss)                  (1,436)       (476)     (2,987)       (995)

Other income (expense)
   Interest income                                       30          10          70          13
   Interest expense                                    (882)        (45)     (1,709)        (94)
   Loss on foreign exchange transactions, net          (631)        (15)       (912)        (69)
   Net gain on sale of cable duct                        77        --         1,920        --
   Net gain (loss) on sale of assets                     (6)        184        (124)        (39)
   Other                                               (177)       --           212         312
                                                   --------    --------    --------    --------
                                                     (1,589)        134        (543)        123
                                                   --------    --------    --------    --------

Earnings (loss) before income taxes and minority
interest                                             (3,025)       (342)     (3,530)       (872)

Income tax (income) expense                              38         (17)         52         (35)

Minority interest (income) expense                      608          62         593         127
                                                   --------    --------    --------    --------

Net loss                                           $ (2,379)   $   (297)   $ (2,885)   $   (780)

Preferred stock dividend requirements                  (158)       --          (316)       --
                                                   --------    --------    --------    --------

Net loss applicable to common shares               $  (2537)   $   (297)   $ (3,201)   $   (780)

Earnings per share - basic and diluted

Net loss per share                                 $  (2.44)   $  (0.30)   $  (2.95)   $  (0.08)
Basic weighted average common shares                    977         977         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   $   (0.24)  $  (0.03)   $ (0.30)    $  (0.80)
   Net loss
Diluted average common shares                          9,766      9,766      9,766        9,766
</TABLE>


                                       5
<PAGE>
<TABLE>
<CAPTION>

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

                                                             For the six month
                                                           Period Ended June 30,
                                                            2005           2004
                                                        (Unaudited)    (Unaudited)
<S>                                                     <C>            <C>
Cash flows from operating activities
   Net loss                                             $    (2,885)   $      (780)
   Adjustments to reconcile net loss to net
      cash used in operating activities
      Depreciation, depletion and amortization                1,196          1,124
      Net loss on foreign currency transactions                 912             69
      Net (gain) loss on sale of assets                      (1,796)            39

      Changes in operating assets and liabilities
         Accounts receivable                                 (1,330)          (823)
         Other current and non current assets                 1,869          2,142
         Accounts payable and other liabilities              (3,762)        (3,407)
                                                        -----------    -----------

      Net cash used in operating activities                  (5,796)        (1,636)

Cash flows provided by (used in) investing activities
   Proceeds from sale of assets                               7,211           --
   Purchase of property and equipment, net                   (1,442)        (2,276)
                                                        -----------    -----------

          Net cash provided by (used in) investing
                Activities                                    5,769          (2,276)

Cash flows from financing activities
   Proceeds from borrowings                                   5,765          7,547
   Payments on debt                                          (6,447)        (4,509)
                                                        -----------    -----------

          Net cash provided by (used in) financing
                Activities                                     (682)         3,038

          Net increase (decrease) in cash and                  (709)          (874)
                 cash equivalents

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

   Cash and cash equivalents at end of period           $       643    $       546
</TABLE>





                                       6
<PAGE>
<TABLE>
<CAPTION>

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

                                                                    For the six month
                                                                  Period Ended June 30,
                                                                   2005           2004
                                                               (Unaudited)    (Unaudited)
                                                               -----------    -----------
<S>                                                            <C>            <C>
Supplemental Disclosures of Cash Flow Information:

Cash paid for interest                                                 597             94
Cash paid for taxes                                                   --               35

Schedule of non-cash investing and financing activities:
    Unrealized foreign currency translation loss                      (274)           (69)
    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 Six Months Ended June 30, 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  and six  month  periods  ended  June  30,  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  properties 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 $170,000  non  interest  bearing
note.

The  repayment  of the  notes  is  limited  to the cash  flow of the  respective
properties 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):

                                                             June 30,     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                      $     12,714   $     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%                                 13,534         10,522
                                                           ------------   ------------
                                                                 29,145         29,866

Less: current maturities                                          9,327          9,603
                                                           ============   ============
                                                           $     19,818         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 one segment for 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.  In July
CableTEL  AD sold an  additional  segment and  recorded a sale of  approximately
$2,400,000.  It is  anticipated  that CableTEL AD will record the balance of the
contract during the remainder of 2005

During the three months ended June 30, 2005 CableTel AD sold several segments of
a  second  duct  and  recorded  sales of  approximately  $228,000  and a gain of
$77,000.



NOTE E - SEGMENT REPORTING


Business Operations

         The Company operates three separate distinct businesses




                                       8
<PAGE>
<TABLE>
<CAPTION>

         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,  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 June 30, 2005.


The segment information and reconciliation to income (loss) from operations that
follows includes the Bulgarian  telecommunications  activities and US operations
for the three and six months ended June 30,  2005.  For the three and six months
ended June 30, 2004 the Bulgarian  telecommunication was the only segment of the
Company.



                                                Cable      Corporate       Real        Oil     Consolidated
                                                                          Estate    Operation      CIC
                                              -------------------------------------------------------------
<S>                                           <C>          <C>            <C>       <C>        <C>
Three months ended June 30, 2005
(amounts in thousands)

Revenue
   Cable operations                               2,831                                               2,831
   Real estate operations                                                   1,127                     1,127
   Oil & gas operations                                                                   396           396
                                              -------------------------------------------------------------
                                                  2,831                     1,127         396         4,354
                                              -------------------------------------------------------------

Operating expenses
   Operations                                     1,992                       660         292         2,944
   Lease expense                                    255           19          212                       486
   Depletion, depreciation and amortization         518                        93          27           638
   Corporate general and administrative           1,461          261                                  1,722
                                              -------------------------------------------------------------
                                                  4,226          280          965         319         5,790
                                              -------------------------------------------------------------

Operating earning  (loss)                        (1,395)        (280)         162          77        (1,436)

Interest Income                                                   30                                     30
Interest expense                                    394          332          156                       882
Loss on foreign exchange transactions, net         (631)        (631)
Loss on sale of assets                                                         (6)                       (6)
Gain on sale of cable duct                           77                                                  77

Net earnings (loss)                              (2,346)        (188)          78          77        (2,379)


Total assets                                     22,305       12,294       10,783       1,781        47,163




                                       9
<PAGE>

                                                Cable      Corporate       Real        Oil      Consolidated
                                                                          Estate     Operation      CIC
                                              --------------------------------------------------------------

Six months ended June 30, 2005
(amounts in thousands)

Revenue
   Cable operations                               5,236                                                5,236
   Real estate operations                                                   2,277                      2,277
   Oil & gas operations                                                                    810           810
                                              --------------------------------------------------------------
                                                  5,236                     2,277          810         8,323
                                              --------------------------------------------------------------

Operating expenses
   Operations                                     3,864                     1,275          559         5,698
   Lease expense                                    599           39          423                      1,061
   Depletion, depreciation and amortization         918                       225           53         1,196
   Corporate general and administrative           2,827          528                                   3,355
                                              --------------------------------------------------------------
                                                  8,208          567        1,923          612        11,310
                                              --------------------------------------------------------------

Operating earning  (loss)                        (2,972)        (567)         354          198        (2,987)

Interest Income                                                   70                                      70
Interest expense                                    755          771          183                      1,709
Loss on foreign exchange transactions, net         (912)                                                (912)
Loss on sale of assets                                                        (48)         (76)         (124)
Gain on sale of cable ducts
                                                  1,920                                                1,920


Net earnings (loss)                              (1,911)      (1,271)         175          122        (2,885)

Total assets                                     22,305       12,294       10,783        1,781        47,163
</TABLE>

















                                       10
<PAGE>

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


Overview

         In  October  2004 the  Company  acquired  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 legal acquirer,  in accordance with Statement
of Accounting Standards No. 141 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 and six months  ended June 30,  2005 with the
three and six months ended June 30, 2004 will  include only  CableTEL AD for the
three and six month ended June 30, 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.



                                       11
<PAGE>

Liquidity and Capital Resources

         At June 30,  2005 the  Company had  current  assets of  $7,993,000  and
current  liabilities of  $26,760,000.  During the past two years 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. In the second quarter of 2005 CableTEL AD sold a small
section of the remaining duct held for sale and anticipates  selling  additional
sections to the same buyer in the future.

         Included in current  liabilities  is an  obligation  of  principal  and
accrued  interest  of  $2,830,000  the  terms of which  are  similar  to that of
preferred  stock  whereby  the  Company  can  only pay  this  obligation  out of
available earned surplus.


         Cash and cash equivalents at June 30, 2005 were $643,000  compared with
$1,352,000 at December 31, 2004.

         Net cash used by operating activities was $5,796,000 for the six months
ended June 30, 2005. During the six month period the Company had a loss net loss
of  $2,885,000.  Included in the six month  period was a net gain on the sale of
assets of $1,796,000 which was principally the sale of an additional  segment of
the cable duct that  CableTEL AD has under  contract for sale.  The Company also
recorded a loss on foreign monetary  transactions of $912,000 and  depreciation,
depletion and amortization of $1,196,000.

         Net cash provided in investing  activities  was  $5,769,000 for the six
months  ended June 30,  2005.  In March and April of 2005 the  Company  sold two
assisted  living  communities  and  received   approximately   $3,000,000  which
approximated  book value for the properties.  The proceeds were used principally
to pay off the  existing  mortgages.  During the six months  ended June 30, 2005
CableTel AD invested approximately $4,600,000 for the purchase of equipment that
upgraded  the  existing  cable  infrastructure  as well as  construction  of the
backbone. This investment was principally vendor financed.


         Net cash flow used in  financing  activities  was  $682,000  in the six
months ended June 30, 2005.  The additional  funds  received of $5,765,000  from
financing  activities  during  the six  months  were  principally  used to repay
existing trade payables and short term debt.



                                       12
<PAGE>

Results of Operations

         The Company  reported a net loss of $2,379,000  and  $2,885,000 for the
three and six months ended June 30, 2005,  as compared to a net loss of $297,000
and $780,000 for the three and six months ended June 30, 2004

         Revenue from cable  operations  was  $2,831,000  and $5,236,000 for the
three and six  months  ended  June 30,  2005,  as  compared  to  $2,241,000  and
$4,419,000 for the  corresponding  periods 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 three and six months  ended June 30, 2005 the Company  recorded
revenues  of  $1,127,000  and  $2,277,000  for its real  estate  operations  and
$396,000 and $810,000 for its oil and gas  operation.  The Company's  retirement
property is fully occupied and it is  anticipated  that it will remain so during
2005. The Company's retail shopping mall was  approximately 76% occupied at June
30, 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 for
the remainder of 2005.

         CATV operations expense was $1,992,000 and $3,864,000 for the three and
six months ended June 30, 2005 as compared to $1,459,000  and $2,708,000 for the
corresponding period in the prior year. The cost of acquiring programming rights
for cable product increased by $324,000 and $756,000 in the three and six months
ended  June 30,  2005 as  compared  to 2004.  In  addition  there was an overall
increase in general costs in  anticipation  of the backbone being  completed and
more services being offer.

         For the three and six months  ended June 30, 2005 the Company  recorded
$660,000 and $1,275,000 in expenses for its real estate  operations and $292,000
and $559,000 for its oil and gas operations.

         Lease expense for the cable  operation was $255,000 and $599,000 in the
three and six months  ended June 30, 2005  compared to $240,000 and $435,000 for
the  corresponding  periods 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 staff and corporate offices in Bulgaria.

         For the three and six months  ended June 30, 2005 the Company had lease
expenses of $231,000  and $462,000 in the United  States  which was  principally
incurred by its real estate operation.

         Depreciation and amortization for CableTEL AD was $518,000 and $918,000
for the three and six months  ended June 30, 2005 as  compared  to $520,000  and
$1,124,000  for  corresponding   periods  in  the  prior  year.  The  additional
depreciation  in 2005,  is due to fixed asset  additions  and was,  for the most
part,  offset by a decrease due to CableTEL AD's changing the  determination  of
useful life of certain of its depreciable assets.

         For the three  and six  months  ended  June 30,  2005 the  depreciation
expense for the real estate operation was $93,000 and $225,000 and the depletion
of the oil operation was $27,000 and $53,000.

         Corporate  general  and  administrative  expense  for  CableTEL  AD was
$1,461,000  and  $2,827,000  for the three and six months ended June 30, 2005 as
compared to $499,000 and $1,147,000 for the corresponding  periods for the prior
year.  The  increase in  expenses  is  attributable  to the  development  of the
backbone and the anticipated growth of the business. The bulk of the increase is
attributable either directly or indirectly to increased administrative personnel
in Bulgaria. Personnel expenses increased by approximately $500,000 and $800,000
for the three and six months ended June 30,  2005.  This  included  personnel to
oversee the  construction of the backbone and additional  marketing,  accounting



                                       13
<PAGE>

and technical personnel.  Professional fees, principally accounting and auditing
fees,  have increased by  approximately  $100,000 and $300,000 for the three and
six months ended June 30, 2005, 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 three and six months ended June 30, 2005 the corporate  general
and  administrative  expense for the United  States  operation  was $261,000 and
$528,000.

         Interest  expense for  CableTEL AD was  $394,000  and  $755,000 for the
three and six months  ended June 30, 2005 as compared to $45,000 and $94,000 for
the corresponding  periods 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  three and six  months  ended  2005 the  interest  expense  for
certain foreign  corporate  subsidiaries  acquired by the Company as part of the
October 14, 2004 acquisition was $342,000 and $658,000. With respect to the U.S.
operations the interest expense for the three and six months ended June 30, 2005
for the real estate  operation was $101,000 and $183,000 and corporate  interest
was $45,000 and $113,000.

         The net loss on  foreign  exchange  transactions  for the three and six
months  ended June 30, 2005 was $631,000 and $912,000 as compared to $15,000 and
$99,000 for the corresponding periods in the prior year. 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  ducts by  CableTEL  AD was $77,000
and  $1,920,000 in the three and six months of 2005.  CableTEL AD is selling two
cable ducts which were built with the intention of seeing to third parties.  The
sale of the  ducts are  being  recognized  as  sections  of the duct and  access
thereon is delivered and paid for by the buyers.


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.

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




                                       14
<PAGE>

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


         Based upon their most recent evaluation,  which was completed as of the
end of the period covered by this Report, the Acting Principal  Executive Office
and Acting Chief Financial Officer have concluded that the Company's  disclosure
controls  and  procedures  were  effective  at June 30,  2005,  to  ensure  that
information  required  to be  disclosed  in reports  that the  Company  files or
submits  under the  Securities  Exchange Act of 1934,  is  recorded,  processed,
summarized  and  reported  within the time period  specified in  Securities  and
Exchange  Commission  rules and forms.  There  were no changes in the  Company's
internal  controls over  financial  reporting  during the quarter ended June 30,
2005,  that have  materially  affected or are  reasonably  likely to  materially
affect the Company's internal controls over financial reporting."







                                       15
<PAGE>
<TABLE>
<CAPTION>

                           PART II: OTHER INFORMATION



ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
-------------------------------------------------------------------

During  the  period  of time  covered  by  this  report  CabelTel  International
Corporation did not repurchase any of its equity securities. The following table
sets forth a summary for the quarter  indicating  no  repurchases  were made and
that, at the end of the period  covered by this report,  no specified  number of
shares may be purchased under any program in place.

                                                                               Maximum
                                                               Total Number   Number of
                                                                of Shares      Shares
                                                                Purchased     that May
                                      Total        Average      as Part of      Yet be
                                      Number        Price        Publicly     Purchased
                                    of Shares      Paid per     Announced     Under the
     Period                         Purchased       Share        Program      Program(a)
     ------                        -----------   -----------   -----------   -----------
<S>                                <C>           <C>           <C>           <C>
Balance as of March 31, 2005              --            --            --            --

April 1-30, 2005 ...........              --     $      --            --            --

May 1-31, 2005 .............              --            --            --            --

June 1-30, 2005 ............              --            --            --            --
                                   -----------   -----------   -----------   -----------

Total ......................              --     $      --            --            --
                                   ===========   ===========   ===========   ===========
</TABLE>

(a)      As a courtesy  to  stockholders  of less than 100 shares and to relieve
         such stockholders of having to pay a broker's commission,  the Company,
         although  not  obligated  to do so, has  periodically  repurchased  its
         common  stock at the then most recent  closing  price of the  Company's
         common stock on the last trading day before the stock certificate(s) is
         actually  received by the Company from the  stockholder.  The number of
         such  shares  purchased  in any  period  of time has been  minimal;  no
         purchases were made during the quarter ended June 30, 2005.


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

         The following  exhibits are filed herewith or incorporated by reference
         as indicated below.

         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: August 19, 2005                     By: /s/ Gene S. Bertcher
                                             -----------------------------------
                                             President & Chief Financial Officer




</TEXT>
</DOCUMENT>
