SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                    Form 10-Q

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

                  For the Quarterly Period Ended June 30, 2001

                                       OR

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

                         Commission File Number 0-20757

                           TRAVIS BOATS & MOTORS, INC.
             (Exact name of registrant as specified in its charter)


          TEXAS                                         74-2024798
(State or other jurisdiction of                      (I.R.S. Employer
 incorporation or organization)                   Identification Number)



             5000 Plaza on the Lake, Suite 250, Austin, Texas 78746
                    (Address of principal executive offices)
       Registrant's telephone number, including area code: (512) 347-8787


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

                          Common Stock, $.01 Par Value
                                (Title of class)


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


Indicate the number of shares  outstanding  of each of the  issuer's  classes of
Common Stock as of the latest practicable date.

Common Stock $.01 par value - 4,365,027 shares as of August 13, 2001.



<PAGE>

<TABLE>
<CAPTION>

                                      INDEX

<S>      <C>                                                                                                      <C>
PART I - FINANCIAL INFORMATION


Item 1:  Financial Statements (Unaudited):
                           Condensed Consolidated Balance Sheets:
                           June 30, 2001 and September 30, 2000....................................................1

                           Condensed Consolidated Statements of Operations:
                           Three and Nine Months Ended June 30, 2001 and 2000......................................2

                           Condensed Consolidated Statements of Cash Flows:
                           Nine Months Ended June 30, 2001 and 2000................................................3

                           Notes to Condensed Financial Statements.................................................4

Item 2:..Management's Discussion and Analysis of Financial
                           Condition and Results of Operations.....................................................5



PART II - OTHER INFORMATION

Items 1 - 6........................................................................................................9

Signatures........................................................................................................10

</TABLE>









                                       i
<PAGE>


PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

<TABLE>
<CAPTION>


Travis Boats & Motors, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
 ( in thousands, except share data )
                                                                               June 30,      September 30,
                                                                                 2001            2000
                                                                          ----------------   --------------
                                                                             (unaudited)
<S>                                                                              <C>              <C>
ASSETS:
      Current assets:
            Cash and cash equivalents                                              $6,524           $2,971
            Accounts receivable, net                                               20,637           11,616
            Inventories, net                                                       76,189           78,079
            Deferred tax asset                                                         71               71
            Income taxes recoverable                                                  310            1,368
            Prepaid expenses and other                                                876              923
                                                                          ----------------   --------------
              Total current assets                                                104,607           95,028

      Property and equipment:
            Land                                                                    5,982            5,819
            Buildings and improvements                                             15,418           14,713
            Furniture, fixtures and equipment                                       8,555            8,262
                                                                          ----------------   --------------
                                                                                   29,955           28,794
            Less accumulated depreciation                                         (7,342)          (5,878)
                                                                          ----------------   --------------
                                                                                   22,613           22,916

      Deferred tax asset                                                              204              204

      Intangibles and other assets :
            Goodwill and non-compete agreements, net                               10,602           11,253
            Other assets                                                              311              246
                                                                          ----------------   --------------
              Total assets                                                       $138,337         $129,647
                                                                          ================   ==============

LIABILITIES AND STOCKHOLDERS' EQUITY
      Current liabilities:
            Accounts payable                                                       $9,215           $4,359
            Accrued liabilities                                                     2,550            1,826
            Income taxes payable                                                        0                0
            Floor plan and revolving line of                                       75,582
            credit                                                                                  73,282
            Current portion of notes payable and other short-term                   1,160            4,613
            obligations
                                                                          ----------------   --------------
              Total current liabilities                                            88,507           84,080

      Notes payable, less current portion                                          10,743            6,015

      Stockholders' equity
            Serial Preferred stock, $.01 par value,
              1,000,000 shares Authorized, no shares outstanding
            Common Stock, $.01 par value, 50,000,000 authorized,
              4,370,027 and 4,399,027 issued and outstanding at
              June 30, 2001 and September 30, 2000, respectively                       44               44
            Paid-in capital                                                        15,370           15,464
            Retained earnings                                                      23,673           24,044
                                                                          ----------------   --------------
              Total stockholders' equity                                           39,087           39,552

                                                                          ----------------   --------------
              Total liabilities and stockholders' equity                         $138,337         $129,647
                                                                          ================   ==============

</TABLE>


       See notes to unaudited condensed consolidated financial statements

                                       1

<PAGE>


<TABLE>
<CAPTION>

Travis Boats & Motors, Inc. and Subsidiaries
Unaudited  Condensed  Consolidated  Statements  of  Operations  (Unaudited)
(in thousands, except share data and stores open)

                                                             Three months ended              Nine months ended
                                                                  June 30,                        June 30,
                                                            2001           2000             2001           2000
                                                         -------------------------      -------------------------

<S>                                                       <C>            <C>             <C>            <C>

Net sales..............................................   $73,455        $ 82,872        $155,059       $163,884
Cost of goods sold.....................................    55,835          62,062         117,664        122,264
                                                         -----------    ----------      -----------    ----------

Gross profit...........................................    17,620          20,810          37,395         41,620

Selling, general and administrative....................    11,984          12,942          30,626         31,160
Depreciation and amortization..........................       720             692           2,145          1,945
                                                         -----------    ----------      -----------    ----------
                                                           12,704         13,634           32,771         33,105

Operating income........................................    4,916          7,176            4,624          8,515
Interest expense........................................   (1,619)        (1,902)          (5,391)        (5,044)
Other income/(expense)..................................       11              1               48             18
                                                         -----------    ----------      -----------    ----------

Income/Loss before income taxes.........................    3,308          5,275             (719)         3,489
Income tax provision/(benefit)..........................    1,212          1,932             (348)         1,278
                                                         -----------    ----------      -----------    ----------

Net Income/(Loss).......................................   $2,096         $3,343            ($371)        $2,211
                                                         ===========    ==========      ===========    ==========

Basic Earnings/ (Loss) Per Share........................    $0.48          $0.76           ($0.09)        $0.50
Diluted Earnings/ (Loss) Per Share......................    $0.48          $0.75           ($0.09)        $0.50

Weighted average common shares outstanding..............4,371,016      4,413,983        4,378,908      4,400,749
Weighted average dilutive common shares outstanding.....4,372,557      4,450,618        4,378,908      4,462,516

Stores open at end of period............................       38             39               38             39
                                                         ===========    ==========      ===========    ==========


</TABLE>


           See notes to unaudited condensed consolidated financial statements



                                       2

<PAGE>



<TABLE>
<CAPTION>

Travis Boats & Motors, Inc. and Subsidiaries
Unaudited Condensed Consolidated Statements of Cash Flow
(in thousands)

                                                                                           Nine months ended
                                                                                                June 30,
                                                                                       2001                2000
                                                                                   ----------------------------------
<S>                                                                                      <C>               <C>

Operating activities:
Net Income/(Loss)                                                                         ($371)              $2,211
Adjustments to reconcile net income (loss) to net cash provided by
(used in) Operating activities:
      Depreciation.................................................................       1,484               1,158
      Amortization.................................................................         661                 787
      Changes in operating assets and liabilities
           Accounts receivable.....................................................      (9,021)             (9,511)
           Prepaid expenses........................................................          47                (33)
           Inventories.............................................................       1,890            (21,078)
           Other assets............................................................         (65)               (414)
           Accounts payable........................................................       4,856               4,142
           Accrued liabilities.....................................................         724               (425)
           Income tax benefit......................................................       1,058             (3,049)
           Unearned revenue........................................................           0               1,334

                                                                                   --------------     ---------------
      Net cash provided by (used in) operating activities..........................       1,263            (24,878)


      Investing Activities:
      Purchase of businesses.......................................................           0               (336)
      Purchase of property and equipment...........................................      (1,191)             (3,813)

                                                                                   --------------     ---------------
      Net cash used in investing activities........................................      (1,191)             (4,149)

      Financing activities:

      Net increase in notes payable and other short term obligations...............       3,575              32,508
      Net proceeds (payments) from issuance
         (repurchase) of common stock..............................................         (94)                 22
                                                                                   --------------     ---------------
      Net cash provided by financing activities....................................       3,481              32,530
      Change in cash and cash equivalents..........................................       3,553               3,503
      Cash and cash equivalents, beginning of period...............................       2,971               4,125


                                                                                   --------------     ---------------
      Cash and cash equivalents, end of period.....................................      $6,524              $7,628
                                                                                   ==============     ===============


</TABLE>

       See notes to unaudited condensed consolidated financial statements

                                       3
<PAGE>



              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                  JUNE 30, 2001


NOTE 1 - BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements have been
prepared  from the  records  of Travis  Boats & Motors,  Inc.  and  subsidiaries
(collectively,  the Company)  without audit. In the opinion of management,  such
financial  statements  include all  adjustments  (consisting  of only  recurring
accruals)  necessary to present fairly the financial  position at June 30, 2001;
and the  interim  results  of  operations  and cash flows for the three and nine
month periods ended June 30, 2001 and 2000. The condensed  consolidated  balance
sheet at September  30,  2000,  presented  herein,  has been  prepared  from the
audited  consolidated  financial  statements  of the Company for the fiscal year
then ended.

Accounting  policies  followed  by the Company  are  described  in Note 1 to the
audited  consolidated  financial  statements for the fiscal year ended September
30, 2000.  Certain  information and footnote  disclosures  normally  included in
financial  statements  have  been  condensed  or  omitted  for  purposes  of the
condensed consolidated interim financial statements.  The condensed consolidated
financial statements should be read in conjunction with the audited consolidated
financial  statements,  including the notes  thereto,  for the fiscal year ended
September 30, 2000 included in the Company's annual Report on Form 10-K.

The results of  operations  for the three and nine month  periods ended June 30,
2001 are not  necessarily  indicative of the results to be expected for the full
fiscal year.

                                       4
<PAGE>



NOTE 2 - NET INCOME PER COMMON SHARE

All earnings per share amounts for all periods have been  presented,  to conform
to the Statement 128 requirements.

Statement 128 requires the  calculation  of earnings per share to exclude common
stock  equivalents  when the inclusion of such would be  anti-dilutive.  For the
nine month period ended June 30, 2001, the inclusion of common stock equivalents
would have been anti-dilutive  based upon the net loss posted by the Company. As
such, all common stock  equivalents  were excluded in the computation of diluted
earnings per share for the nine months ended June 30, 2001.

The following table sets forth the computation of basic and diluted net loss per
share:
<TABLE>
<CAPTION>

                                             Three Months Ended                 Nine Months Ended
                                                  June 30                          June 30
                                          2001               2000            2001            2000
                                          ----               ----            ----            ----

<S>                                 <C>                  <C>            <C>             <C>

Numerator:
         Net income/(loss)          $ 2,096,000          $3,343,000     ($  371,000)     $2,211,000
Denominator:
         Denominator for basic
         earnings per share -
         weighted avg. shares         4,371,016           4,413,983       4,378,908      4,400,749

Effect of dilutive securities:
         Employee stock options           1,541              36,635      -----------        61,767

Denominator for diluted earnings
         per share - adjusted
         weighted average shares      4,372,557          4,450,618        4,378,908      4,462,516
         and assumed conversions
                                    ---------------------------------------------------------------
Basic earnings per share                 $.48               $.76             ($.09)           $.50
                                    ---------------------------------------------------------------

Diluted earnings per share               $.48               $.75             ($.09)           $.50
                                    ---------------------------------------------------------------

</TABLE>

As of June 30,  2001,  the Company had issued and  outstanding  incentive  stock
options to certain  officers,  directors and employees  totaling  415,464 shares
which had a strike price  exceeding the closing  price of the  Company's  common
stock on such date.  The 415,464  option shares have a weighted  average  strike
price of $6.81 and a weighted average outstanding remaining life of 6.97 years.

                                       5
<PAGE>


NOTE 3 - STOCKHOLDERS' EQUITY

During fiscal 2000, the Company established a program to repurchase  outstanding
shares of its common stock in the open market from time to time. The Company has
made  purchases of its common stock pursuant to this program and has retired all
such common shares repurchased. The total number of repurchased shares of common
stock  consisted of the  following as of June 30, 2001 (all  repurchased  shares
have been retired):



     Shares Repurchased (000's)                 44
     Total Purchase Price (000's)               $153
     Average Price per Share                    $3.48


NOTE 4 - COMPREHENSIVE INCOME

For the three and nine months  ended June 30, 2001 and 2000,  Comprehensive  Net
Income (loss) equaled Net Income (loss).

Item 2.   Management's  Discussion  And  Analysis Of  Financial  Conditions  And
          Results Of Operations

General

Travis  Boats & Motors,  Inc.  ("Travis  Boats" or the  "Company")  is a leading
multi-state  superstore  retailer of recreational  boats,  motors,  trailers and
related marine accessories in the southern United States. The Company,  which as
of the  date of this  Report  on  10-Q,  currently  operates  37  stores  (after
consolidating locations formerly in Miami, Florida and Huntsville,  Alabama into
other existing Travis store  locations)  under the name Travis Boating Center in
Texas, Arkansas,  Louisiana, Alabama, Tennessee,  Mississippi,  Florida, Georgia
and  Oklahoma, seeks to  differentiate  itself  from  competitors  by  providing
customers  a  unique  superstore  shopping  experience  that  showcases  a broad
selection of high quality boats, motors, trailers and related marine accessories
at firm,  clearly  posted low  prices.  Each  superstore  also  offers  complete
customer  service  and  support,   including  in-house  financing  programs  and
full-service repair facilities staffed by factory-trained mechanics.

History

Travis Boats was incorporated as a Texas corporation in 1979. As used herein and
unless  otherwise  required  by the  context,  the  terms  "Travis  Boats",  the
"Company"  and "we" shall mean Travis  Boats & Motors,  Inc.  and its direct and
indirect subsidiaries.

Since its founding in 1979 as a single  retail store in Austin,  Texas,  we have
grown  both  through  acquisitions  and  the  opening  of new  "start-up"  store
locations. During the 1980s, we expanded into San Antonio, Texas, purchased land
and built a new  store  facility.  After  this,  we  purchased  additional  boat
retailers  that  operated  stores in the Texas  markets of  Midland,  Dallas and
Abilene.  It was  during  this  early  period  of  store  growth  that we  began
developing  the  systems  necessary  to  manage  a  multi-store   operation  and
maximizing our inventory  purchases to obtain  increased volume  discounts.  Our
success  in  operating  numerous  stores  and  maximizing  volume  discounts  on
inventory  purchases  led to the  introduction  of our  own  proprietary  Travis
Edition  packaging  concept and our philosophy of clearly posting price signs on
each of our boats held for sale.  Since  1990,  we have  opened or  acquired  34
additional store locations and closed or consolidated two (2) store locations in
the  following  states:  Texas,   Arkansas,   Louisiana,   Alabama,   Tennessee,
Mississippi, Florida, Georgia and Oklahoma.

We sell  approximately 75 different types of Travis Edition models of brand-name
fishing,  water-skiing and general recreational boats, such as family ski boats,
off-shore fishing boats,  personal  watercraft,  cabin cruisers and yachts up to
approximately 60 feet in length. We also sell motors, trailers,  accessories and
related  equipment.  Although we sell pleasure  boats at many  different  retail
prices,  we attempt to price our product to maintain a  consistent  gross profit
percentage for each of our Travis Edition models. We study sales trends from the
cities and states where we operate store locations.  We use the information from
this data to custom design and pre-package  combinations  of popular  brand-name
boats, such as Larson,  Wellcraft,  Scarab,  Bayliner,  Trophy, Sprint, Sea Ark,
Fishmaster and Ranger with outboard  motors  generally  manufactured by Outboard
Marine  Corporation or Brunswick  Corporation,  along with trailers and numerous

                                       6
<PAGE>

accessories,  under our own  proprietary  Travis Edition label.  These signature
Travis Edition  packages,  which account for the vast majority of total new boat
sales,  have been designed and developed in coordination  with the manufacturers
and often include distinguishing features and accessories that have historically
been  unavailable to, or listed as optional by, many  competitors.  We also sell
yachts, such as Carver, Martinique, Cruisers and Luhrs that range in length from
25 feet to over 50 feet. By providing  many  different  types of boats with many
types of standard features, we attempt to offer the customer an exceptional boat
at a competitive price that is ready for immediate use and enjoyment.

Results of Operations

Quarter Ended,  June 30, 2001 Compared to the Quarter  Ended,  June 30, 2000 and
Nine Months Ended,  June 30, 2001  Compared to the Nine Months  Ended,  June 30,
2000.

Net sales.  Net sales for the three month  period ended June 30, 2001 were $73.5
million, a decrease of approximately $9.4 million or 11.4% from the net sales of
$82.9  million in the same quarter of fiscal 2000.  Net sales for the nine month
period ended June 30, 2001 were $155.1 million, a decrease of approximately $8.8
million  or 5.4%  from the net sales of $163.9  million  in the same nine  month
period of fiscal 2000.

The primary  component  of the  decrease in net sales during the three month and
nine  month  periods  ended June 30,  2001 has been the result of a decrease  in
comparable  store sales.  While  comparable store sales benefited from increased
sales related to  parts/accessories  and service labor/repair fees for the three
month period ended June 30, 2001 (increased by 23% and 37%, respectively),  this
was offset by a general decline in overall sales of pleasure  boats.  Comparable
store sales  declined by 11.8% (35 stores in base) and 10.6% (33 stores in base)
during  the three and nine month  periods  ended  June 30,  2001,  respectively.
Management  believes  the  decrease  in  comparable  store  sales was related to
various factors  including  erratic levels of consumer  confidence as well as an
overall weak economic and marine  industry.  In certain  markets along the Texas
and Louisiana  coastlines these factors were  exaggerated by weather  conditions
related to the severe impact of tropical storm Allison.

Gross profit.  Gross profit decreased by 15.3% to approximately $17.6 million in
the third  quarter  of fiscal  2001 from $20.8  million  in the same  quarter of
fiscal 2000.  Gross profit,  as a percent of net sales,  decreased to 24.0% from
25.1% during the same periods.  For the nine months ended,  June 30, 2001, gross
profit decreased 10.1% to $37.4 million from $41.6 million in the same period of
the prior year.  Gross  profit,  as a percent of sales,  decreased to 24.1% from
25.4% during the same period.

The  decrease in gross  profit,  both in actual  dollars and as a percent of net
sales,  was  primarily  related to the Company and certain of its  manufacturers
offering  additional  incentives  and  rebates  on  various  models of boats and
outboard engines. The manufacturer  incentives and rebates were developed by the
manufacturers  as part of an effort to stimulate  sales as the overall  industry
sales performance has been soft.  Additionally,  the Company has developed other
incentives  as  part  of  its  ongoing  inventory   reduction  plan  implemented
previously  during  the  summer of the  recently  completed  2000  fiscal  year.
Management  believes  that  these  programs  or  similar  levels  of  additional
incentives  and rebates will  continue  for the  remainder of fiscal 2001 and at
least the first quarter of fiscal 2002. While these programs have impacted gross
profit,  the Company has been successful in reducing overall  inventory  levels.
The Company's  inventory levels were approximately  $76.2 million as of June 30,
2001  versus  $95.3  million as of June 30,  2000.  See  "Liquidity  and Capital
Resources."

F&I Products.  We offer our customers the ability to purchase  extended  service
contracts and insurance coverage,  including credit life and accident/disability
coverage's (collectively "F&I Products"). The extended service contracts provide
customers with coverage for mechanical engine breakdown for a period (usually 36
or 48  months)  beginning  after  the  stated  warranty  term  of  the  original
manufacturer expires. The insurance coverage provides the customer with funds to
repay a portion or all of their boat loan in the event of death,  disability  or
other  covered  event.  Since  we  have  business  relationships  with  numerous
financial  lenders we also offer to assist our customers in obtaining  financing
for their boat  purchase.  If the  customer  purchases  F&I Products or utilizes
financing  we have  helped  arrange,  we earn  commissions  based upon our total
volume of sales or the amount of mark-up we charge over the cost of the products
sold.

         Net sales of these products contributed  approximately $2.7 million, or
15.4%, of total gross profit in the third quarter of fiscal 2001, as compared to

                                       7
<PAGE>

$3.3 million or 15.9%,  of total gross profit for the third quarter of the prior
fiscal year. For the nine months ended, June 30, 2001, net sales attributable to
F&I Products  accounted  for $5.4  million,  or 14.3% of the total gross profit,
compared to $6.4  million or 15.3%,  for the same period of the prior year.  Net
sales attributable to F&I Products are reported on a net basis,  therefore,  all
of such sales  contribute  directly to the  Company's  gross  profit.  The costs
associated  with the sale of F&I Products  are included in selling,  general and
administrative expenses. Management attributes the reduced sales of F&I Products
due primarily to lower overall yields paid by lenders for  originating  customer
finance contracts and competitive  pressures on finance rates (which resulted in
lower net spreads achieved in the placement of customer financing). Decreases in
the  percentage  of  customers  buying these  products  (which is referred to as
"sell-through"),  particularly by purchasers of the larger, more expensive boats
and  reduced  customer  demand for  certain  insurance  products  have also been
limiting factors.

         Selling,  general and  administrative  expenses.  Selling,  general and
administrative  expenses  decreased to $12.0  million in third quarter of fiscal
2001 from $12.9 million for the third quarter of fiscal 2000.  Selling,  general
and administrative  expenses,  as a percent of net sales,  increased to 16.3% in
the third  quarter  of fiscal  2001 from  15.6% for the third  quarter of fiscal
2000.  For  the  nine  months  ended  June  30,  2001,   selling,   general  and
administrative  expenses  were $30.6  million,  or 19.8% as a percentage  of net
sales,  versus $31.2 million,  or 19.0% as a percentage of net sales in the same
period of the prior fiscal year

The decrease in selling,  general and administrative  expenses in actual dollars
for the quarter  ended June 30,  2001 versus the same  quarter of the prior year
was  primarily   attributable  to  the  reduction  in  wages,   commissions  and
travel/entertainment  expenses.  The  Company has  managed  headcount  primarily
through attrition and selective position consolidation. The reduction in overall
expenses  was  offset  by  increases  in  certain  expenses  such as  utilities,
insurance, fuel costs and rent/lease expense.

Depreciation and Amortization  Expenses.  Depreciation and amortization expenses
increased by 4.0% to $720,000 in the third  quarter of fiscal 2001 from $692,000
for the third quarter of fiscal 2000. Depreciation and amortization expenses, as
a percent of net sales,  increased  to 1.0% in the third  quarter of fiscal 2001
from 0.8% for the third quarter of fiscal 2000.  Depreciation  and  amortization
expenses,  as a percentage  of net sales,  increased to 1.4% for the nine months
ended June 30, 2001, versus 1.2% in the same period of the prior fiscal year.

The increase in depreciation and amortization  expenses,  both in actual dollars
and as a percent of net sales,  was primarily  attributable to the  depreciation
expenses of the Company's recently completed superstore location in San Antonio,
Texas and other improvements to its asset infrastructure.

Interest  expense.  Interest  expense  decreased  to $1.6  million  in the third
quarter of fiscal 2001 from $1.9  million in the third  quarter of fiscal  2000.
Interest expense, as a percent of net sales,  decreased to 2.2% from 2.3% of net
sales in the third  quarter of both fiscal 2001 and fiscal  2000,  respectively.
For the nine months  ended June 30,  2001,  interest  expense  increased to $5.4
million  from $5.0  million in the same  period of the prior  year and  interest
expense as a percent of net sales increased to 3.5% from 3.1%.

Interest  expense,  both in actual  dollars  and as a percent of net sales,  was
positively  impacted by a decrease in the Company's  short term borrowing  rates
and inventory debt levels  relative to the same periods of the prior year.  This
decrease in interest  expense for the three  months ended June 30, 2001 has been
somewhat offset by the incremental  interest  expense incurred on the additional
long term debt related to the Company's new superstore in San Antonio, Texas and
other real estate holdings.

Net profit/(loss). The Company posted a net profit of approximately $2.1 million
for the third quarter of fiscal 2001 versus a net profit of  approximately  $3.3
million in the third quarter of fiscal 2000.  For the nine months ended June 30,
2001  the  Company  posted  a net  loss of  $371,000,  versus  a net  profit  of
approximately $2.2 million for the nine months ended June 30, 2000.

Liquidity and Capital Resources

The Company's short-term cash needs are primarily for working capital to support
operations, including inventory requirements,  off-season liquidity and store or
infrastructure  expansion.  These short-term cash needs have  historically  been
financed with cash from operations and borrowings under the Company's  borrowing
agreements.  At June 30, 2001, the Company had working capital of  approximately
$16.1 million, centered in approximately $76.2 million in inventories, offset by
approximately  $75.6  million in  short-term  revolving/floorplan  credit  lines

                                       8
<PAGE>

outstanding under its borrowing  agreements.  As of June 30, 2001, the aggregate
maximum borrowing limit pursuant to the borrowing agreements was $110.0 million,
of which the Company's  eligibility to borrow  additional sums up to the maximum
is pursuant to the borrowing base formula.  The Company's borrowing base formula
allows  the  Company  to borrow  against  substantially  all of its new and used
inventory as well as certain  accounts  receivable  in  determining  its maximum
borrowing availability. "See Subsequent Event".

Operating activities generated cash of $1.3 million for the first nine months of
fiscal 2001 of which the primary  components  were a decrease of $1.9 million in
inventories and an increase of $9.0 million in accounts  receivable offset by an
increase in accounts  payable of $4.9 million.  The first  quarter  historically
represents   the  "off"  or  "slow"   selling   season  for  the  Company   (see
"Seasonality").  While inventory has declined for the nine months ended June 30,
2001,  inventory  levels  generally  fall to an  annual  low  point  during  the
Company's  fourth fiscal  quarter.  Beginning  with the  Company's  first fiscal
quarter it builds inventory  levels to support the sales levels  consistent with
the second and third fiscal quarters which encompass the primary boating season.

Merchandise inventories were approximately $76.2 million and approximately $78.1
million as of June 30, 2001 and September 30, 2000, respectively.

The Company used net cash in investing  activities of approximately $1.2 million
in the first nine  months of fiscal 2001 as the  Company  continued  to renovate
stores to superstore  standards and update certain  facilities with its standard
superstore trade dress awnings, pole signage and neon.

Financing  activities  for  the  nine  months  ended,  June  30,  2001  provided
approximately  $3.5  million of cash flows  primarily  from the net  proceeds of
borrowings  under the Company's  borrowing  agreements.  The agreements  include
borrowing   agreements   entered  into  in  January,   2000  with   Transamerica
Distribution  Finance  ("TDF") and Deutsche  Financial  Services  ("DFS") in the
principal  amounts  of $50.0  million  and $60.0  million,  respectively.  These
borrowing  agreements,  which  contain  substantially  similar  terms  and  have
maturity  dates of January  2003,  provide for a combined  borrowing  at various
sub-prime  based or LIBOR based  interest  rates.  Borrowings  are pursuant to a
borrowing base formula and are used primarily to finance inventory purchases and
for general working capital requirements.  Substantially all inventory, accounts
receivable and intangible assets collateralize these borrowing  agreements.  The
terms of the borrowing  agreements also provide for: (i) fees for administrative
monitoring,  (ii)  fees for  unused  portions  of  available  credit,  and (iii)
pre-payment  fees in the event of the Company's  termination of such floor plans
prior to their stated maturity dates in January,  2003. The borrowing agreements
also include  restrictive loan agreements  containing various loan covenants and
borrowing restrictions, including minimum financial ratios (governing net worth,
current assets,  debt to worth  percentages and cash flow coverage  requirements
based upon  interest  expense and monthly  principal  and  interest  payments on
debts).  The payment of dividends or repurchases  of the Company's  common stock
are also  significantly  limited by the borrowing  agreements.  "See  Subsequent
Event".

The Company's  borrowing  agreements and internally  generated  working  capital
should be sufficient to meet the Company's cash requirements in the near future.

Liquidity and Capital Resources - Subsequent Event

Effective,  January 16, 2001,  the Company  amended and  restated its  borrowing
agreements  with TDF and DFS to  provide  for the  waiver  and  modification  of
certain ratio levels for each quarterly  period through and including  September
30,  2001.  The amended  borrowing  agreements,  which  mature in January  2003,
continue  to  provide  for a total  of $110  million  in  inventory  floor  plan
financing and working capital borrowings.  Interest on the borrowing  agreements
is at variable  rates ranging from the lender's  daily prime rate minus 0.25% to
LIBOR plus 3.0%, fixed for each 30 day period.

Effective  with the company's  financial  results for the period ended March 31,
2001, the Company was in violation of several financial ratio covenants with TDF
and DFS.  The Company  has  remained  out of  compliance  with the ratio  levels
required  as of  the  period  ended  March  31,  2001  and is  currently  out of
compliance  with the ratio levels  required as of June 30, 2001. The Company has
notified  DFS and  TDF of  non-compliance  and  has  requested  the  waiver  and
re-establishment  of ratio's  with  consideration  towards the  current  Company
performance and the overall weak industry and economic environments.

The  Company  believes  that  it will be  able  to  re-establish  the  financial
covenants  which  will be  based  upon the  Company's  current  and  anticipated

                                       9
<PAGE>

performance as well as giving consideration to the current overall weak industry
and economic  environments.  However,  material  shortfalls  or  variances  from
anticipated performance or a pro-longed period of industry decline could require
the Company to seek further amendment to the amended borrowing agreements or, in
the event that  re-established  ratios  cannot be negotiated  with lenders,  the
Company  will have to seek  alternate  sources of financing  including,  but not
limited to, raising additional equity capital.  Management  believes the Company
is currently in compliance  with all other terms and conditions of its borrowing
agreements.

Seasonality

The Company's business,  as well as the sales demand for various types of boats,
tends to be highly  seasonal.  Strong sales  typically begin in January with the
onset of the public boat and recreation  shows,  and continue through July. Over
the previous three fiscal years,  the average annual net sales for the quarterly
periods  ended  March  31 and  June 30  represented  approximately  25% and 40%,
respectively,  of the Company's annual net sales. With regard to net income, the
Company historically generates profits in its fiscal quarters ending on March 31
and June 30.  While the Company  seeks to be  profitable  for the quarter  ended
September 30,  operating  profits for the three months ended  September 30, 2000
were offset by certain reserve  allowances and other charges to operations.  The
Company  experiences  operating losses in the quarter ended December 31 due to a
broad seasonal slowdown in sales.

During the quarter ended September 30,  inventory  typically  reaches its lowest
levels and  accumulated  cash  reserves  reach the  highest  levels.  During the
quarter ended  December 31, the Company  generally  builds  inventory  levels in
preparation  for  the  upcoming  selling  season  which  begins  with  boat  and
recreation  shows occurring during January through March in certain market areas
in which the Company conducts business. Travis Boats' operating results would be
materially and adversely affected if net sales were to fall significantly  below
historical levels during the months of January through June.

The  Company's  business is also  significantly  affected  by weather  patterns.
Weather  conditions that are  unseasonable  or unusual may adversely  affect the
Company's  results of  operations.  For example,  drought  conditions  or merely
reduced  rainfall  levels,  as well as excessive  rain, may affect the Company's
sale of boating packages and related products and accessories.  While management
believes that the Company's  quarterly net sales will continue to be impacted by
Seasonality,  quarterly  results may become less susceptible to certain regional
weather conditions as expansion occurs throughout the southern United States.

Quarterly  results  may  fluctuate  as a result  of the  revenues  and  expenses
associated  with new  store  openings,  store  acquisitions  or store  closures,
including the timing of such events. Accordingly,  the results for any quarterly
period may not be  indicative  of the expected  results for any other  quarterly
period.

Cautionary  Statement for purposes of the Safe Harbor  Provisions of the Private
Securities Litigation Reform Act of 1995.

Other than  statements  of historical  fact,  all  statements  contained in this
Report  on  Form  10-Q,  including   statements  in  "Item  1.  Business",   and
"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations",  are forward-looking  statements as that term is defined in Section
27A of the  Securities Act of 1933, as amended and Section 21E of the Securities
Exchange Act of 1934 that involve a number of uncertainties.  The actual results
of the future events described in the forward-looking  statements in this Report
on Form 10-Q could differ  materially from those stated in such  forward-looking
statements.  Among  the  factors  that  could  cause  actual  results  to differ
materially  are:  general  economic   conditions,   competition  and  government
regulations,  as well as the risks and uncertainties discussed in this Report on
Form 10-Q, including without limitation, the matters discussed in "Risk Factors"
and the  uncertainties set forth from time to time in the Company's other public
reports,  filings and public statements,  including the Company's Report on Form
10-K  for  the  Fiscal  Year  ended  September  30,  2000.  All  forward-looking
statements in this Report on Form 10-Q are expressly qualified in their entirety
by the cautionary statements in this paragraph.

Other Business Matter - Bankruptcy and Subsequent Sale of Significant Supplier

On December  22,  2000,  one of the  Company's  primary  supplier's  of outboard
engines,  Outboard Marine  Corporation  ("OMC") filed a voluntary petition under
Chapter  11  of  the  United  States  Bankruptcy  Code.  The  bankruptcy  filing
terminated the master agreement under which we purchased outboard engines, which
otherwise  would have  expired on June 30, 2001.  The  Company,  in the ordinary
course of its  operations,  had  certain  amounts  due from and due to OMC.  The
Company  believes  that it has the benefit of certain  rights of "off-set"  that
when  implemented  will  result in the  elimination  of such  amounts  without a
detrimental effect on its financial operations.

                                       10
<PAGE>


On February 9, 2001, a federal  bankruptcy judge approved the sale of OMC's main
assets to Bombardier,  Inc. and Genmar Holdings,  Inc. Under the deal,  Canadian
based Bombardier purchased OMC's Johnson and Evinrude outboard engine brands and
Minneapolis based Genmar purchased OMC's boat lines.  Travis Boats currently has
business  relationships with both Bombardier and with Genmar to purchase certain
types and  brands of marine  watercraft.  However,  subsequent  to  Bombardier's
purchase of OMC, the Company and  Bombardier  have not entered into any material
agreements governing the purchase of outboard engines. Consequently, the Company
has  primarily  limited  OMC  related  purchases  from  Bombardier  to parts and
accessories for outboard engines.

The Company also maintains a contract with an  alternative  supplier of outboard
engines,  Brunswick Corporation,  covering the terms for the purchase of Mercury
outboard  motors  through  the period  ending  June 30,  2001.  The  Company and
Brunswick  are currently  negotiating  to renew this  agreement  and  management
believes  that such  negotiations  will be  culminated  prior to the new boating
season.  Although management believes that it can secure additional  alternative
sources of outboard engines at similar or improved  quality and prices,  if such
engines are not readily available in appropriate prices and quantities or if the
Company were not to renew or extend its existing agreement with Brunswick beyond
the upcoming  expiration,  we could experience  inventory  shortfalls,  which if
severe enough could (i) cause  significant  disruptions  or delays in our sales,
and (ii) diminish retail pricing, therefore, harming our financial condition.


PART II.  OTHER INFORMATION

Item 1.  Legal Proceedings

From time to time,  the  Company is involved  in  litigation  relating to claims
arising  from its  normal  business  operations.  Currently,  the  Company  is a
defendant  in  several  lawsuits.  Some of these  lawsuits  involve  claims  for
substantial  amounts.  While the ultimate  outcome of these  lawsuits  cannot be
ascertained,   after  consultation  with  counsel,   the  Company  believes  the
resolution  of these  suits  will  not have a  material  adverse  effect  on the
Company's financial condition or results of operations. However, there can be no
assurance as to the ultimate outcome of these matters.

Item 2.  Changes in Securities

Not applicable

Item 3.  Defaults Upon Senior Securities

Effective as of its March 31, 2001 and June 30, 2001,  the  Company's  operating
results were out of compliance  with two (2) ratio covenants and a miscellaneous
covenant of its Borrowing  Agreements  with  Transamerica  Distribution  Finance
("TDF") and Deutsche Financial Services ("DFS"):

                     - Interest  Coverage  Ratio With respect to the TDF and DFS
                     Borrowing Agreements,  the Interest Coverage Ratio requires
                     Travis Boats to  maintain,  as of the 12 months ended March
                     31, 2001, an Interest  Coverage Ratio of not less than 1.00
                     to 1.00.  Travis Boats' Interest  Coverage Ratio for the 12
                     months  ended  March 31,  2001 was 0.90 to 1.00 and as such
                     Travis Boats was not in compliance with the Agreement. With
                     respect  to the TDF and DFS  Borrowing  Agreements,  Travis
                     Boats was also  requires to  maintain,  as of the 12 months
                     ended June 30, 2001, an Interest Coverage Ratio of not less
                     than 1.15 to 1.00.  Travis Boats'  Interest  Coverage Ratio
                     for the 12 months  ended June 31, 2001 was 0.60 to 1.00 and
                     as  such  Travis  Boats  was  not in  compliance  with  the
                     Agreement.

                    - Fixed  Charge  Coverage  Ratio With respect to the TDF and
                    DFS Borrowing  Agreements,  the Fixed Charge  Coverage Ratio
                    requires  Travis  Boats'  to  maintain,  as of the 12 months
                    ended March 31, 2001, a Fixed Charge  Coverage  Ratio of not
                    less than 1.20 to 1.00.  Travis Boats' Fixed Charge Coverage
                    Ratio for the 12  months  ended  March 31,  2001 was 1.10 to
                    1.00 and as such Travis Boats was not in compliance with the
                    Agreement.  With  respect  to  the  TDF  and  DFS  Borrowing
                    Agreements,  Travis Boats was also required to maintain,  as
                    of the 12  months  ended  June  30,  2001,  a  Fixed  Charge
                    Coverage Ratio of not less than 1.35 to 1.00.  Travis Boats'
                    Fixed Charge Coverage Ratio for the 12 months ended June 30,
                    2001 was 0.90 to 1.00 and as such  Travis  Boats  was not in
                    compliance with the Agreement.

                                       11
<PAGE>


                    - Default Under Other Agreements.  The Borrowing  Agreements
                    are  cross-  defaulted,  thus lack of  compliance  under one
                    agreement  constitutes  lack of  compliance  under the other
                    agreement.


See  Part  I -  Item 2 -  Management's  Discussion  and  Analysis  of  Financial
Conditions  and  Results of  Operations  -  Liquidity  and  Capital  Resources -
Subsequent Events

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

Not applicable

Item 5.  Other Information

Not applicable

Item 6.  Exhibits and Reports on Form 8-K

         (a)    Exhibit               Description            Incorporated by
                 Number                                        Reference to

                                TBC Management, Ltd. Part           Not
                 10.52          I Amendment to Employment        Applicable
                              Agreement With Mark T. Walton

                 10.53          TBC Management, Ltd. Part           Not
                                I Amendment to Employment        Applicable
                           Agreement With Ronnie L. Spradling

                 10.54          TBC Management, Ltd. Part           Not
                                I Amendment to Employment        Applicable
                          Agreement With Michael B. Perrine


         (b)    Reports on Form 8-K

               The Company has not filed any reports on Form 8-K for the quarter
               ended June 30, 2001.



                                   SIGNATURES

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

Date: August 14, 2001                      Travis Boats & Motors, Inc.


                                           By: /s/ Michael B. Perrine
                                              ---------------------------------
                                              Michael B. Perrine
                                              Chief Financial Officer, Treasurer
                                              and Secretary
                                              (Principal Accounting and
                                               Financial Officer)