UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

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

                                   FORM 10-KSB

/X/      ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
         EXCHANGE ACT OF 1934

For the Calendar year ended DECEMBER 31, 1999
                            -----------------

                                       OR

/  /     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
         EXCHANGE ACT OF 1934
For the transition period from  ______________ to ______________

                        Commission file number 333-51909
                                    ---------

                                ABLE ENERGY, INC.
           ---------------------------------------------------------
             (Exact name of Registrant as specified in its charter)


<TABLE>
<CAPTION>
<S>                                                                                    <C>
                            Delaware                                                   22-3520840
                (State or Other Jurisdiction of                                     (I.R.S. Employer
                 Incorporation or Organization)                                    Identification No.)
</TABLE>



<TABLE>
<CAPTION>
<S>                                                                        <C>
344 Route 46
Rockaway, New Jersey                                                       07866
(Address of Principal Executive Offices)                                   (Zip Code)
</TABLE>


                                 (973) 625-1012
                 Issuer's Telephone Number, Including Area Code)

         Securities Registered under Section 12(b) of the exchange Act:

                                                           Name of Each Exchange
Title of Each Class                                          on Which Registered

         Securities registered under Section 12(g) of the Exchange Act:

                     Common Stock, $.001 par value per share
                                (Title of Class)


                                (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 the
Registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days. Yes X No

         Indicate by check mark if no disclosure of delinquent  filers  pursuant
to Item 405 of Regulation  S-B is not contained in this form,  and no disclosure
will be contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. ______


<PAGE>
         The issuer's revenues for its most recent fiscal year. $19,670,000.

         The aggregate  market value of the voting and  non-voting  common stock
held by non-affiliates  of the registrant  computed by reference to the price at
which  the  common  stock  was  sold as of  March  24,  2000  was  approximately
$6,000,000.

         The  number of shares  outstanding  of the  registrant's  Common  Stock
outstanding as of March 24, 2000 was 2,000,000.

DOCUMENTS INCORPORATED BY REFERENCE:

         None.



         Transitional Small Business Disclosure Format:  Yes ______; No X
<PAGE>
                                     PART I

ITEM 1.       DESCRIPTION OF BUSINESS

History

     Able Energy was incorporated on March 13, 1997 in the state of Delaware, to
act as a  holding  company  for five  operating  subsidiaries:  Able  Oil;  Able
Propane; Able Melbourne; Able Montgomery and A&O.

     On December 31, 1999,  the Company  sold all of its  outstanding  shares of
Able  Montgomery,  its  Pennsylvania  retail  heating  oil  distributor,  to  an
unaffiliated  third party in exchange for monetary  consideration and a ten-year
franchise agreement with the buyer.

     Also on December 31, 1999, the Company sold all of its  outstanding  shares
of common stock of A&O, its environmental consulting and engineering subsidiary,
to  Owl  Environmental,   Inc.,  one  of  A&O's   subcontractors,   for  nominal
consideration.  The  Company  decided  to sell A&O in light of A&O's  continuing
operating losses.

Overview

     The Company is engaged in the retail  distribution of, and the provision of
services  relating to, (i) fuel oil,  (ii)  propane  gas, and (iii)  natural gas
through a marketing alliance  agreement with AllEnergy  Marketing Company LLC, a
division  of New England  Electric  Systems,  Inc.  In addition to selling  home
energy products, the Company offers complete HVAC (heating,  ventilation and air
conditioning)  installation and repair and also markets other petroleum products
to commercial customers, including diesel fuel, gasoline and lubricants.

     In fiscal year 1998, sales of home heating oil accounted for  approximately
70% of the Company's revenues.  The remaining 30% of revenues were from sales of
gasoline, diesel fuel, kerosene, propane, and environmental services and related
sales. The Company serves  approximately  20,000 home heating oil customers from
three  locations,  of which two are  located in New Jersey and one is located in
Florida.

     The Company also provides installation and repair of heating equipment as a
service  to its  customers.  The  Company  considers  service  and  installation
services  to be an  integral  part of its  business.  Accordingly,  the  Company
regularly  provides various service  incentives to obtain and retain  customers.
The Company provides home heating  equipment repair service on a 24 hours-a-day,
seven  days-a-week  basis,  generally  within  two hours of  request.  Except in
isolated  instances,  the Company does not provide  service to any person who is
not a customer.

     The Company  believes that it obtains new customers and maintains  existing
customers  by offering  full service  home energy  products at discount  prices,
providing quick response  refueling and repair operations,  providing  automatic
deliveries to customers by monitoring  historical use and weather patterns,  and
by providing customers a variety of payment options. The Company
<PAGE>
regularly  provides various service  incentives to obtain and retain  customers.
The  Company  aggressively  promotes  its  service  through a variety  of direct
marketing  media,  including  mail and  telemarketing  campaigns,  by  providing
discounts to customers  who refer new  customers to the Company,  and through an
array of advertising,  including television advertisements and billboards, which
aim to increase brand name  recognition.  The Company believes that this focused
marketing strategy has been key to its success.

         The  Company  intends  to expand its  operations  by  acquiring  select
operators in the Company's  present markets as well as other markets,  capturing
market share from  competitors  through  increased  advertising and other means,
diversifying  its products,  diversifying its customer base, and replicating its
marketing and service formula in new geographic areas either directly or through
franchise arrangements. The Company may also enter into marketing alliances with
other  entities in product areas  different than the Company's  current  product
mix.

RETAIL FUEL OIL

         The  Company's  retail  fuel oil  distribution  business  is  conducted
through its  subsidiaries  Able Oil and Able Melbourne.  The Company serves both
residential and commercial fuel oil accounts.  The Company sells premium quality
home  heating  oil  to  its  residential   customers   offering  delivery  seven
days-a-week.  To its commercial  customers,  in addition to selling home heating
oil,  the Company  sells diesel fuel,  gasoline and  kerosene.  The Company also
provides  an oil  burner  service  that  is  available  24  hours-a-day  for the
maintenance,  repair  and  installation  of  oil  burners.  These  services  are
performed  on an as needed  basis.  Customers  are not  required  to enter  into
service contracts to utilize the Company's service department.

         Approximately 50% of the Company's customers receive their home heating
oil pursuant to an automatic delivery system without the customer having to make
an affirmative  purchase  decision.  These deliveries are scheduled by computer,
based on each customer's historical  consumption patterns and prevailing weather
conditions.  Customers can also order deliveries of home heating oil through the
Company's  Web site located at  www.ableenergy.com.  The Company  delivers  home
heating  oil  approximately  six times each year to the  average  customer.  The
Company  bills  customers  promptly  upon  delivery  or  receives  payment  upon
delivery.  The Company's customers can pay for fuel deliveries with cash or with
their credit card.

         In addition,  approximately 5% of the Company's total sales are made to
customers  pursuant to an agreement  which  pre-establishes  the maximum  annual
sales  price of fuel oil and is paid by  customers  over a ten  month  period in
equal monthly  installments.  Such prices are renegotiated in April of each year
and the Company  has  historically  purchased  fuel oil for these  customers  in
advance and at a fixed cost.

         The  Company  delivers  fuel with its own  fleet of 18 custom  fuel oil
trucks and four  owner-operator  fuel oil delivery  trucks.  The Company's  fuel
trucks have fuel capacities ranging from 3,000 to 8,000 gallons. Each vehicle is
assigned to a specific  delivery route,  and services  between 4 and 40 customer
locations per day depending on market density and customers' fuel  requirements.
The Company  also  operates  seven  Company  owned  service vans and four owner-


<PAGE>
operated  service  vans,  which are  equipped  with state of the art  diagnostic
equipment  necessary to repair and/or install heating  equipment.  The number of
customers  each van serves  mostly  depends  upon the  number of  service  calls
received on any given day.

ABLE OIL

         Able  Oil  was  established  in  1989  and  is  the  Company's  largest
subsidiary,  accounting for approximately 87% of the Company's total revenues in
1998. Able Oil is located in Rockaway,  New Jersey, and serves just under 22,000
oil customer accounts throughout northern New Jersey, mostly in Morris,  Sussex,
Warren, Passaic and Essex counties,  from its distribution locations in Rockaway
and Newton,  New Jersey.  Of these accounts,  approximately  90% are residential
customers and 10% are commercial customers.

         Generally,  18 of the Company's fuel oil trucks are reserved for use by
Able Oil, of which nine trucks operate from the Rockaway facility and six trucks
operate from the Newton facility. In addition, Able Oil utilizes the services of
four  owner-operated  trucks.  Each owner operator is under  contract;  they are
responsible  for  all of the  vehicle  operating  expenses  including  insurance
coverage. All of the trucks have the Company's logo on them.

         Able Oil's 18 fuel oil  delivery  trucks,  and the four  owner-operator
trucks,  acquire fuel  inventory  at the  Company's  facilities  in Rockaway and
Newton. Dispatch of fuel oil trucks is conducted at both the Rockaway and Newton
facilities.  Billing is  conducted  from Able Oil's  corporate  headquarters  in
Rockaway.

         The  Rockaway  and Newton  facilities  have the  capacity  to store 1.5
million gallons and 200,000 gallons of fuel, respectively.  During seasons where
demand for heating oil is higher, or when wholesale oil prices are favorable,  a
slightly  larger  inventory  is  kept on  hand.  However,  Management  generally
believes  that short  inventory  life and high  inventory  turnover  enables the
Company to rapidly respond to changes in market prices. Thus, Management employs
"just in time"  inventory  practices and rarely stores fuel to capacity  levels.
However,  in June of 1998,  oil prices  reached a historic  low and the  Company
entered into an in-tank  storage  agreement with Mieco Trading Co., to store 1.5
million gallons of fuel oil at the Company's  facility in Rockaway,  New Jersey.
The Company entered into an additional agreement with Mieco whereby it purchased
all of such fuel oil from November 1998 through March 1999.  Additional fuel oil
purchases are made daily on the spot market using  electronic  funds  transfers.
Able Oil carts its fuel purchases from wholesale  purchase sites to the Rockaway
and Newton facilities with two tractor-trailer tankers owned by the Company, and
by two  owner-operated  tractor-trailer  tankers  that are used on an as  needed
basis. These two owner-operated tankers are under contract and bear the Ablelogo
or name.

         Able Oil's oil burner service  operates  exclusively  out of the Newton
facility.  Able Oil dispatches a total of eleven service vans, four of which are
subcontracted from owner-operators.


<PAGE>
ABLE MELBOURNE

         Able  Melbourne was  established  in July 1996,  and is located in Cape
Canaveral  Florida.   Presently,   revenues  from  Able  Melbourne  account  for
approximately  5.3% of the Company's total  revenues.  Able Melbourne is engaged
primarily  in the sale of diesel  fuel for  commercial  fleet  fueling and other
on-road vehicles,  and dyed diesel fuel, which is used for off-road vehicles and
purposes, including commercial and recreational fishing vessels, heating oil and
generator fuel.  Additionally,  a small portion of Able Melbourne's  revenues is
generated from the sale of home heating oil,  lubricants and lubricant products.
Able Melbourne  serves  approximately  300 customer  accounts in Brevard County,
Florida,  primarily in the Cape Canaveral Area. In 1998, six of Able Melbourne's
customers, Beyel Brothers Crane Service, Beyel Marina, Diamond Royale, Frank-lin
Excavating,  Inc.,  CG  Reed,  S&S  Seafood  and ABC  Landclearing  Development,
individually,  accounted for more than five percent of Able  Melbourne's  annual
revenues.

         Able  Melbourne  delivers fuel with two fuel delivery  trucks which are
capable of storing 6,000 gallons of fuel in aggregate.  Because Able Melbourne's
peak season is at the  opposite  time of the year than the rest of the  Company,
during this  season,  Able  Melbourne  uses one of Able Oil's trucks to meet its
demand.  Currently,  Able Melbourne  does not have  facilities to store fuel oil
beyond what is held on its trucks, and thus, purchases fuel inventory from local
refineries.  However, since Able Melbourne is located only three miles from port
storage,  the  lack of  inventory  capacity  is not  material  to the  Company's
operations or revenue.

RETAIL PROPANE DISTRIBUTION

         The Company is engaged in the retail distribution of liquid propane gas
and  propane  equipment,  and  provides  services  related  thereto  through its
subsidiary  Able  Propane.  Able  Propane,  based in Rockaway,  New Jersey,  was
established 1996 as part of the Company's efforts to increase market penetration
through  diversification.  Able Propane serves approximately 1,100 accounts, the
majority of which are located in northern New Jersey.

         Although  propane can be used for  virtually all household and business
utility applications, of Able Propane's customers, approximately 60% use propane
for hot water  heating  and  cooking;  approximately  10% use  propane  for pool
heating; and approximately 30% use propane for home heating.  Although burned as
a gas,  propane is transported as a liquid and stored in tanks that vaporize the
liquid  for use.  Able  Propane  provides  its  customers  with such tanks at no
charge, and by doing so, remains such customer's  exclusive supplier of propane.
Able  Propane  employs a delivery  system  similar to the  Company's  retail oil
distribution business,  whereby customers receive propane deliveries pursuant to
an automatic  delivery system without the customer having to make an affirmative
purchase  decision.  These  deliveries are scheduled by computer,  based on each
customer's historical consumption patterns and prevailing weather conditions.

         With an increased  marketing  effort,  the Company  believes  that Able
Propane  has the  opportunity  to gain a larger  share of the New Jersey  energy
market  by  converting  electricity  and  fuel  oil  users  to  propane,  and by
encouraging  owners of  newly-constructed  buildings to select  propane as their
buildings' energy source. The Company also believes that the use of propane as
<PAGE>
an alternate fuel for cars,  trucks and public  transportation to meet clean air
requirements, poses a great opportunity for future growth.

         Able Propane's  base of operations is located in Rockaway,  New Jersey,
at the Company's  headquarters.  Currently,  Able Propane has no propane storage
facilities,  and its only investment in propane  inventory is what can be stored
on its one  propane  delivery  truck.  The  delivery  truck has the  capacity to
deliver 3,000 gallons of propane, and can service approximately 35 customers per
day.  Able  Propane  purchases  wholesale  propane  on the spot  market at local
facilities.  The Company is considering  plans to lease or build a facility that
would enable Able Propane to store approximately 30,000 gallons of propane.

FUNDAMENTAL CHARACTERISTICS OF THE COMPANY'S BUSINESS UNAFFECTED
BY GENERAL ECONOMY

         The  Company's  business is relatively  unaffected by business  cycles.
Because fuel oil, propane and gasoline are such basic necessities, variations in
the amount purchased as a result of general economic conditions are limited.

         CUSTOMER STABILITY

         The Company has a relatively  stable  customer base due to the tendency
of  homeowners to remain with their  traditional  distributors.  In addition,  a
majority  of  the  home  buyers  tend  to  remain  with  the  previous   owner's
distributor.  As a result,  the Company's  customer base each year includes most
customers  retained from the prior year, or home buyers who have  purchased from
such customers.  Like many other companies in the industry, the Company delivers
fuel oil and propane to each of its  customers an average of  approximately  six
times  during  the  year,  depending  upon  weather  conditions  and  historical
consumption  patterns.  Most of the Company's customers receive their deliveries
pursuant to an automatic delivery system, without the customer having to make an
affirmative  purchase  decision each time home heating oil or propane is needed.
In addition,  the Company  provides home heating  equipment  repair service on a
seven- days-a-week basis.

         No  single  customer   accounts  for  10%  or  more  of  the  Company's
consolidated revenues.

         CONVERSION TO NATURAL GAS

         The rate of conversion  from the use of home heating oil to natural gas
is primarily  affected by the relative prices of the two products,  and the cost
of  replacing  oil fired  heating  systems  with one that uses  natural gas. The
Company believes that  approximately  1% of its customer base annually  converts
from home  heating oil to natural gas.  Even when natural gas had a  significant
price  advantage over home heating oil, such as in 1980 and 1981 when there were
government  controls on natural gas prices or during the Persian  Gulf Crisis in
1990 and 1991,  the  Company's  customers  converted to natural gas at only a 2%
annual  rate.  During the latter  part of 1991 and  through  1995,  natural  gas
conversions  have returned to their 1% historical  annual rate as the prices for
the two products have been at parity.
<PAGE>
         In an effort to insulate  itself against natural gas conversions and as
         part of the Company's  efforts to expand its product line, the Company,
         pursuant to a marketing  alliance with AllEnergy,  now provides natural
         gas service as an option to its customers (See "Business- Expansion and
         Acquisitions").  AllEnergy  is a  subsidiary  of New  England  Electric
         Systems,  Inc. ("NEES"), a utility company listed on the New York Stock
         Exchange.   Recently,   the  New  Jersey  Board  of  Public   Utilities
         deregulated  the sale and  supply of  natural  gas to  residential  and
         commercial  customers.  Natural  gas  customers  can  now  choose  from
         different providers of natural gas. Natural gas providers,  such as the
         Company,   will  deliver  the  gas  through  the  existing  network  of
         underground gas pipes owned and maintained by the local gas utility.

         OIL PRICE VOLATILITY

         Although  prices of energy  sources have been  volatile,  historically,
this has not affected the performance of the Company because it has been able to
pass  substantially  all wholesale cost increases along to its customers.  While
fluctuations in wholesale prices have not significantly affected demand to date,
it is possible that  significant  wholesale price increase could have the effect
of encouraging  conservation of energy resources.  If demand was reduced and the
Company was unable to increase its gross profit  margin or reduce its  operating
expenses,  the effect of such  decrease in demand  would be a  reduction  of net
income.

         SEASONALITY

         The Company's  business is directly related to the heating needs of its
customers.  Accordingly, the weather can have a material effect on the Company's
sales in any particular year.  Generally,  however, the temperatures in the past
thirty  years  have been  relatively  stable,  and as a  result,  have not had a
significant impact on the Company's  performance,  except on a short-term basis.
In 1997 "El Nino"  caused one of the warmest  winters on record  which  impacted
home heating oil sales during the 1997-1998 winter.

         Approximately  70% of the  Company's  revenues  are earned and received
from October through March, and the  overwhelming  majority of such revenues are
derived from the sale of home heating oil.  During the spring and summer months,
revenues  from  the  sale of  diesel  and  gasoline  fuels  increase  due to the
increased use of automobiles and construction apparatus.

         Each  of  the  Company's  divisions  are  seasonal.  From  May  through
September,  Able Oil  experiences  considerable  reduction of retail heating oil
sales.

         Able  Propane can  experience  up to 80%  decrease  in heating  related
propane sales during the months of April to September,  which is offset somewhat
by an increase of pool heating and cooking fuel.

         Over 90% of Able  Melbourne's  revenues  are  derived  from the sale of
diesel fuel for construction vehicles, and commercial and recreational sea-going
vessels  during  Florida  fishing  season,  which  begins  in April  and ends in
November. Only a small percentage of Able
<PAGE>
Melbourne's  revenues are derived from the sale of home  heating  fuel.  Most of
these sales occur from December through March, Florida's cooler months.

WHOLESALE SUPPLIERS

         Notwithstanding  the  agreement  between  the Company and Mieco for the
supply  of  Number 2  Heating  Oil,  the  Company  does not have  agreements  or
contracts  for the supply of fuel.  The Company  purchases  its fuel on the spot
market.  The Company  satisfies its inventory  requirements  with nine different
suppliers,  the majority of which have  significant  domestic fuel sources,  and
many of which have been suppliers to the Company for over 5 years. The Company's
current suppliers are Ameranda Hess Corporation, Bayway Refining Co., Petron Oil
Corporation,  Star  Enterprises,  Louis Dreyfus Energy,  Koch  Industries,  Co.,
Valero  Marketing and Supply Co., and Sun Co., Inc. (R&M).  The Company monitors
the market each day and  determines  when to purchase its oil inventory and from
whom. As of June 1998,  the Company  began  storing  supplies of fuel equal to a
month's sales of fuel because of unusually low fuel prices.

         Two of these suppliers  provided Able Oil with approximately 60% of its
heating oil requirements for the year ended December 31, 1998.

         Coastal  Refining &  Marketing,  Inc.,  provided  Able  Melbourne  with
approximately  99% of its diesel fuel  product  requirements  for the year ended
December  31,  1998.   Two  major   suppliers   provided  Able   Melbourne  with
approximately  67% and 33%,  respectively,  of its lubricant and related product
requirements  for the  year  ended  December  31,  1998.  Two  major  suppliers,
Ferrellgas  Partners,  L.P.  and  Propane  Power,  provided  Able  Propane  with
approximately 50% each, of its propane  requirements for the year ended December
31, 1998.

         Management  believes  that  if  the  Company's  supply  of  any  of the
foregoing products was interrupted, the Company would be able to secure adequate
supplies from other  sources  without a material  disruption in its  operations.
However,  there can be no assurance that adequate supplies of such products will
be readily available in the future.

TRUCK PURCHASES AND MAINTENANCE

         The Company presently orders and purchases its fuel oil trucks from two
companies that  manufacture  trucks suitable for the Company's  operations.  The
Company has the option to purchase or lease standard  equipment fuel trucks. The
typical  configuration  of the Company's  fuel trucks is a  Freightliner  with a
3,000 gallon  multi-compartment  aluminum  tank, a vapor  recovery  system and a
device that records fuel flow from the storage compartments.  Each truck carries
the Company's registered logo emblazoned on its side.

         Service and environmental testing vehicles are standard commercial vans
which are  obtained  from a number of  sources.  These  vehicles  also carry the
Company logo.

         Generally, the Company relies upon equipment warranties, fixed fee
service contracts and
<PAGE>
on-site repairs for the maintenance of the Company's fleet of vehicles. To date,
the  Company  has not  experienced  significant  downtime on the any of its fuel
trucks.

FRANCHISE DEVELOPMENT

         On December 31, 1999, the Company sold its Able  Montgomery  subsidiary
as a franchise operation. Able Montgomery located in Horsham,  Pennsylvania, was
established  in 1996 and is  engaged  in the retail  sale and  delivery  of home
heating oil. Pursuant to a Stock Purchase Agreement, the Company sold all of the
outstanding  shares of Able  Montgomery  held by the Company to an  unaffiliated
third party for a purchase price of $140,000,  and the purchaser agreed to enter
into a ten-year  franchise  agreement with the Company.  As an incentive for the
purchaser to enter into the Stock Purchase Agreement and operate Able Montgomery
as a franchise,  the Company  agreed to waive the $25,000  franchise fee and the
$15,000 grand opening fee the Company typically charges new franchisees.  At the
time of the sale, Able Montgomery  represented  approximately 1.52% of the total
assets of the  Company  and  approximately  1.82% of the total  revenues  of the
Company.  The  purchaser of Able  Montgomery  issued to the Company a promissory
note for the purchase price of Able  Montgomery.  Pursuant to the Stock Purchase
Agreement,   the  Company   agreed  to  indemnify   the   purchaser  in  certain
circumstances,  which include, any personal injury or property damage claims, or
any environmental  violation,  caused by the Company prior to the closing of the
sale of Able  Montgomery.  The  purchaser  agreed to  indemnify  the  Company in
certain  circumstances,  which  include,  the  breach of any  representation  or
warranty made by purchaser in the Stock  Purchase  Agreement or any of the other
agreements  executed  by the  purchaser  in  connection  with  the  sale of Able
Montgomery.   Additionally,  pursuant  to  the  Stock  Purchase  Agreement,  the
purchaser  agreed to enter  into a Pledge and  Security  Agreement  whereby  the
purchaser  agreed to pledge to the  Company  all of the assets  and  outstanding
shares of Able Montgomery,  and grant to the Company a security  interest in all
of the assets of Able  Montgomery,  pending the  satisfaction  of the promissory
note.  The  promissory  note is payable 60 months  from the date of the note and
accrues interest at a rate of 9.5% per annum,  payable to the Company in monthly
installments.

SALE OF A&O SUBSIDIARY

         A&O  was  established  in 1995  and  was  engaged  in the  business  of
environmental   consulting  and  engineering.   After  assessing  the  potential
profitability  of A&O versus its potential  liabilities,  Management  determined
that it was in the Company's  best  interest to sell A&O.  During the year ended
December 31, 1999,  A&O  experienced  a loss from  operations  of  approximately
$152,000 on revenues of $734,032.  At December 31, 1999, A&O's  liabilities were
approximately  $374,712 as compared to assets of  $221,000.  From its  inception
through year ended December 31, 1998, the Company, through Able Oil, advanced to
A&O approximately $128,442.  Pursuant to a Stock Purchase Agreement, the Company
sold all of the outstanding shares of common stock of A&O held by the Company to
Owl  Environmental,  Inc.  ("Owl"),  one of A&O's  subcontractors,  for  nominal
consideration.  Owl purchased such shares "as is" without recourse or express or
implied warranty from the Company.
<PAGE>
Product Lines

         In  fiscal  year  1998,   sales  of  home  heating  oil  accounted  for
approximately 70% of the Company's revenues.  The remaining 30% of revenues were
from sales of  gasoline,  diesel  fuel,  kerosene,  propane,  and  environmental
services and related  sales.  The Company also  installs  heating  equipment and
repairs such equipment on a 24 hours-a-day,  seven days-a-week basis,  generally
within two hours of request.

Industry Overview

         The  Company's   business  is  highly   competitive.   In  addition  to
competition  from  alternative   energy  sources,   the  Company  competes  with
distributors  offering a broad range of services  and prices,  from full service
distributors   similar  to  the  Company,   to  those  offering  delivery  only.
Competition  with other companies in the propane  industry is based primarily on
customer service and price.  Longstanding customer  relationships are typical in
the  retail  home  heating  oil and  propane  industry.  Many  companies  in the
industry,  including the Company, deliver fuel oil or propane to their customers
based upon weather  conditions and historical  consumption  patterns without the
customers having to make an affirmative  purchase decision each time fuel oil or
propane is needed. In addition, most companies,  including the Company,  provide
equipment repair service on a 24 hour-a-day basis, which tends to build customer
loyalty.  As a result,  the Company may  experience  difficulty in acquiring new
retail customers due to existing  relationships  between potential customers and
other fuel oil or propane distributors.

Marketing, Sales & Strategic Partnerships

         The  Company  employs a dynamic  marketing  strategy  that the  Company
believes has been the key to its success.  The Company  believes that it obtains
new customers and maintains existing customers by offering its full service home
energy  products at discount  prices,  providing  quick  response  refueling and
repair  operations,  providing  automatic  deliveries to customers by monitoring
historical  use and weather  patterns,  and by providing  customers a variety of
payment  options.  To expand its  customer  base and  aggressively  promote  its
service, the Company engages in direct marketing campaigns, advertises regularly
and encourages referrals.

         The Company has successfully  expanded its customer base by employing a
variety of direct marketing tactics, including telemarketing campaigns, mass and
direct mailings,  and by distributing  hand-bills and promotional items, such as
refrigerator magnets, sweatshirts and hats. Additionally, the Company's delivery
personnel is an integral  part of the  Company's  direct  marketing  activities.
While in the field,  drivers  isolate  potential new customers by taking note of
where the Company is not servicing  accounts,  and act as  salespersons  for the
Company.  The  Company  offers its  drivers an  incentive  payment of $.0025 per
gallon of oil  delivered to new customers  obtained by the driver,  plus $20 for
each new automatic  delivery customer and $10 for each conversion of an existing
customer to automatic delivery.

         The Company uses advertising campaigns to increase brand recognition
and expand its
<PAGE>
customer base, including radio and television  advertisements,  billboards,  and
newsprint  and telephone  directory  advertisements.  Additionally,  the Company
utilizes  its  fleet  of  fuel  delivery  trucks  and  service  vans  as  moving
advertisements by emblazoning them with the Company's logo.

         Historically,  referrals  have been an important  part of the Company's
efforts to expand its business and the Company  offers  incentives  to customers
who refer  business.  Customers  who refer  business  receive  either  $30 or 25
gallons of heating oil at no charge for each new customer referred.  The Company
also  encourages  civic and  religious  organizations  to refer  business to the
Company.  As an incentive,  the Company pays such  organizations  a donation for
each of its members who become  customers  and a stipend based upon the members'
fuel consumption.

Patents and Trademarks

         Able Oil owns the  exclusive  right and license to use,  and to license
others to use,  the  proprietary  marks,  including  the service mark "Able Oil-
-Registered  Trademark-"  (and  design)  ("Proprietary  Marks").  The "Able Oil-
-Registered  Trademark-" service mark and design was registered under Classes 37
and 39 of the Principal Register of the U.S. Patent & Trademark Office ("USPTO")
on  April  30,  1996  (registration  No.  1,971,758).   In  addition,  Able  Oil
established  certain  common law rights to the  Proprietary  Marks  through  its
continuous,  exclusive and extensive public use and advertising. The Proprietary
Marks are not registered in any state.

         Presently there is no effective  determination by the USPTO,  Trademark
Trial and Appeal  Board,  the  trademark  administrator  of any state,  or court
regarding  the  Proprietary  Marks,  nor  is  there  any  pending  interference,
opposition or cancellation  proceeding or any pending  litigation  involving the
Proprietary Marks or the trade names,  logotypes, or other commercial symbols of
Able Oil. There are no agreements  currently in effect that significantly  limit
the rights of Able Oil to use or license the use of the Proprietary Marks.

Environmental Considerations and Regulation

         The  Company  has  implemented   environmental  programs  and  policies
designed to avoid potential  liability under applicable  environmental laws. The
Company has not incurred any  significant  environmental  compliance  cost,  and
compliance with  environmental  regulations has not had a material effect on the
Company's  operating  or  financial  condition.  This  is  primarily  due to the
Company's  general policies of not owning or operating fuel oil terminals and of
closely  monitoring its compliance with all  environmental  laws. In the future,
the Company does not expect  environmental  compliance to have a material effect
on its operations and financial condition.  The Company's policy for determining
the timing and amount of any environmental  cost is to reflect an expense as and
when the cost becomes probable and reasonably capable of estimation.

         On January 31, 1997, Able Oil submitted to the New Jersey Department of
Environmental   Protection  a  revised  Discharge  Prevention   Containment  and
Countermeasure plan ("DPCC") and Discharge, Cleanup and Removal plan ("DCR") for
the facility at 344 Route 46
<PAGE>
East in Rockaway,  New Jersey.  The State of New Jersey requires companies which
operate  fuel  storage  facilities  to prepare  such  plans,  as proof that such
companies are capable of, and have planned for, an event that might be deemed by
the State to be hazardous to the environment.  In addition to these plans,  Able
Oil has this facility  monitored on an ongoing basis to ensure that the facility
meets or exceeds all standards required by the State.

         The  Company   experienced   no  spill   events   that  would   warrant
investigation by state or other environmental regulatory agencies. All locations
are prepared to deal with such an event should one occur.

GOVERNMENT REGULATIONS

         Numerous  federal,  state and local laws,  including  those relating to
protection  of  the  environment   and  worker  safety,   effect  the  Company's
operations. The transportation of fuel oil, diesel fuel, propane and gasoline is
subject to regulation by various federal, state and local agencies including the
U.S.  Department of Transportation  ("DOT").  These regulatory  authorities have
broad powers,  and the Company is subject to regulatory and legislative  changes
that can effect the economies of the industry by requiring  changes in operating
practices or influencing demand for, and the cost of providing, its services.

         The regulations provide that, among other things, the Company's drivers
must  possess  a  commercial   driver's  licence  with  a  hazardous   materials
endorsement. The Company is also subject to the rules and regulations concerning
Hazardous Materials  Transportation Act. For example,  the Company's drivers and
their  equipment  must  comply  with  the  DOT's  pre-trip   inspection   rules,
documentation  regulations concerning hazardous materials (i.e.  certificates of
shipments  which  describe  the type,  and amount of product  transported),  and
limitations  on  the  amount  of  fuel  transported,  as  well  as  driver  time
limitations.  Additionally, the Company is subject to DOT inspections that occur
at random  intervals.  Any  material  violation  of DOT  rules or the  Hazardous
Materials  Transportation  Act may  result in  citations  and/or  fines upon the
Company. In addition,  the Company depends upon the supply of petroleum products
from the oil and gas industry  and,  therefore,  is affected by changing  taxes,
price  controls  and  other  laws and  regulations  relating  to the oil and gas
industry  generally.  The Company  cannot  determine  the extent to which future
operations and earnings may be affected by new legislation,  new regulations and
changes in existing regulations.

         The technical  requirements  of these laws and regulations are becoming
increasingly expensive,  complex and stringent.  These laws may impose penalties
or sanctions  for damages to natural  resources or threats to public  health and
safety.  Such laws and  regulations may also expose the Company to liability for
the conduct or conditions caused by others, or for acts of the Company that were
in compliance  with all  applicable  laws at the time such acts were  performed.
Sanctions for noncompliance may include revocation of permits, corrective action
orders,  administrative  or civil  penalties and criminal  prosecution.  Certain
environmental laws provide for joint and several  liabilities for remediation of
spills and  releases of hazardous  substances.  In  addition,  companies  may be
subject to claims alleging  personal  injury or property  damages as a result of
alleged  exposure  to  hazardous  substances,  as  well  as  damage  to  natural
resources.
<PAGE>
         Although the Company  believes that it is in  compliance  with existing
laws and regulations and carries adequate  insurance  coverage for environmental
and other  liabilities,  there can be no assurance  that  substantial  costs for
compliance will not be incurred in the future or that the insurance  coverage in
place will be adequate to cover  future  liabilities.  There could be an adverse
affect upon the Company's operations if there were any substantial violations of
these rules and regulations.  Moreover,  it is possible that other developments,
such as more stringent  environmental laws, regulations and enforcement policies
thereunder,  could  result in  additional,  presently  unquantifiable,  costs or
liabilities to the Company.

Employees

         As  of  December  31,  1999,  the  Company  employed  approximately  78
individuals.  From October through March, the Company's peak season, the Company
employs  approximately  75 persons.  From April through  September,  the Company
employs approximately 50 persons. Currently, there are no organized labor unions
representing any of the employees of Company or any of its related companies.

ITEM 2.       DESCRIPTION OF PROPERTY

         The Company's corporate headquarters are located in a 4,000 square foot
facility in Rockaway,  New Jersey.  This  facility  accommodates  the  Company's
corporate,  administrative,  marketing and sales personnel as well as truck yard
space and oil storage  space for Able Oil.  The lease  expires July 31, 1999 and
the annual rent is $14,400 plus $.01 per gallon of throughput at the facility up
to 10,000,000  gallons.  After throughput exceeds 10,000,000 gallons the rent is
calculated  as $.007 per  gallon of  throughput.  The  Company is  currently  in
negotiations  with the owner to purchase  the  property.  While the landlord has
agreed to  indemnify  the Company  from  environmental  violations  prior to the
Company's  occupancy,  the Company is responsible for maintaining the facilities
in compliance with all  environmental  rules and laws. The Company also owns two
buildings,  totaling  4,512 square  feet,  consisting  of wood frame  facilities
located at 38 Diller Avenue,  Newton,  New Jersey that serves as a supply depot,
storage area administrative offices and service facility.

         Able  Melbourne  leases  a 4,000  square  foot  concrete  and  aluminum
facility   that  serves  as  a  storage   facility,   a  service   facility  and
administrative offices, located at 735 Snapper Road, Cape Canaveral, Florida and
is governed  by an oral,  month-to-month  lease with annual rent of $2,862.  The
Company  does not store fuel oil at this  location  with the  exception  of that
which is kept in the delivery  trucks.  This  facility is  conveniently  located
within three miles of its wholesale  supplier.  The Company is  responsible  for
maintaining the facilities in compliance with all environmental rules and laws.

         Able Propane  leases a 619 square foot  facility,  located at 318 Route
46, Dover, New Jersey,  which houses its administrative  offices.  No propane is
stored at this  facility.  The lease expires  September 14, 1999, and the annual
rent is $8,851.80  for the period of September  14, 1997 to September  14, 1998,
and $9,736.80 for the period of September 15, 1998 to September
<PAGE>
14,  1999.  In  addition,  the  Company  must pay  20.89% of the costs of refuse
collection,  common area  maintenance and insurance.  The Company is responsible
for maintaining the facilities in compliance  with all  environmental  rules and
laws.  The Company  intends to relocate  the propane  division to the  Company's
existing   facilities  in  Rockaway,   New  Jersey  that  will  house  not  only
administrative offices but also service and supply facilities.

ITEM 3.       LEGAL PROCEEDINGS

         The  Company is not  currently  involved in any legal  proceeding  that
could  have a  material  adverse  effect on the  results  of  operations  or the
financial condition of the Company.  From time to time, the Company may become a
party to litigation  incidental to its business.  There can be no assurance that
any future  legal  proceedings  will not have a material  adverse  affect on the
Company.

ITEM 4.       SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         None.




<PAGE>
                                     PART II

Item 5.       Market for Common Equity and Related Stockholder Matters

Market For Securities

         The Company's  Common Stock  commenced  trading on the Nasdaq  SmallCap
Market on June 29, 1999.  The  following  table sets forth the high and low sale
price of the Common Stock on a quarterly basis, as reported by Nasdaq:
<TABLE>
<CAPTION>

DATE                                            High Price          Low Price
----
<S>                                             <C>                 <C>
     Quarter ended:                             $7.00               $5.00
     June 30, 1999 (commencing                  $8.00               $7.06
     June 29, 1999)
     September 30, 1999                         $7.75               $6.00
     December 31, 1999                          $7.13               $5.25
----------------------------------------------- ------------------  ----------------
</TABLE>

         At March 24, 2000,  there were  approximately 646 holders of record of
the Company's  Common Stock. The Company has not paid dividends on its shares of
Common Stock  outstanding in the past. There are no restrictions  that limit the
ability of the Company to pay dividends or are likely to do so in the future.

Recent Sale of Unregistered Securities

         None.




<PAGE>
ITEM 6.       MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

         The  statements  contained in this Report that are not  historical  are
forward-looking   statements,   including  statements  regarding  the  Company's
expectations,  intentions,  beliefs or strategies regarding the future. Forward-
looking  statements  include  the  Company's   statements  regarding  liquidity,
anticipated  cash needs and  availability  and anticipated  expense levels.  All
forward-looking  statements  included  in this  Report are based on  information
available  to the  Company  on the  date  hereof,  and the  Company  assumes  no
obligation to update any such  forward-  looking  statement.  It is important to
note that the Company's  actual  results could differ  materially  from those in
such  forward-looking  statements.  Additionally,  the following  discussion and
analysis should be read in conjunction  with the Financial  Statements and notes
thereto  appearing  elsewhere in this Report.  The discussion is based upon such
financial  statements which have been prepared in accordance with U.S. Generally
Accepted Accounting Principles.

Management's Discussion and Analysis of Financial Condition and
Results of Operations

         Revenue Recognition

         Sales of fuel are  recognized  at the time of delivery to the customer,
and sales of equipment are recognized at the time of installation.  Revenue from
repairs and  maintenance  service is recognized  upon completion of the service.
Payments  received from customers for heating  equipment  service  contracts are
deferred  and  amortized  into  income over the term of the  respective  service
contracts, on a straight line basis, which generally do not exceed one year.

                  Results of Operations

                  Year  ended  December  31,  1999,  compared  to the year ended
December 31, 1998.

                  The  Company  reported  revenues of  $19,670,365  for the year
ended December 31, 1999, an increase of 20.55% over the prior year's revenues of
$16,317,668.  This was in a warmer  than  normal  winter  during  the  months of
November  and  December.  This  increase  can  be  attributed  to an  aggressive
marketing program, fuel sold at a discount, under a promotion and an increase in
the price for sale of  products  by the  Company.  There was also an increase in
service work during this period.  Revenues for the year ended  December 31, 1998
include  $1,031,028  of sales made by  subsidiaries  which were sold in December
1998.  Had such  revenues not been  included in total revenue for the year ended
December 31, 1998,  the increase in revenues  from such period to the year ended
December  31,  1999 would have been  26.86%.  The year ended  December  31, 1999
included  $308,936 of revenues  for the period  August 27, 1999 to December  31,
1999 from the acquisition of B & B Fuels on August 27, 1999.

                  Gross profit margin, as a percentage of revenues, for the year
ended December 31, 1999, decreased 3.0%, from 20.1% one year ago to 17.1% in the
year ended  December 31, 1999.  This decrease is a result of a rise in the price
of fuel with only a partial corresponding sales price increase.  The sales price
was  increased  in the  fourth  quarter  of 1999 and the price rise began in the
third


<PAGE>
quarter of 1999. These figures do not take into account the subsidiaries sold in
December 1998, whose effect on gross margin was immaterial.

                  Selling,  General and  Administrative  expenses  increased  by
$574,366,  or 21.11%,  from  $2,720,598  for the year ended December 31, 1998 to
$3,294,964 for the year ended  December 31, 1999. Had the expenses  attributable
to the two subsidiaries  sold in December 1998 not been included,  this increase
would have been $920,963 or 33.85%.  This year  included  costs of $132,594 from
acquisitions  in August and September 1999. This increase was due to an increase
in marketing costs,  sales  promotion,  outside service related to acquisitions,
computer  equipment and software  upgrade to account for the year 2000 issue and
additional staff to manage this upgrade.

                  Operating  loss  for the  year  ended  December  31,  1999 was
$466,043, an increase of 562.78% over the Company's operating income of $100,705
for the year ended December 31, 1998.  This operating loss was  attributable  to
lower  gross  profit  resulting  from  higher  product  cost  without  a  timely
corresponding  raise in price,  increased  cost due to a public  offering  which
utilized a large  amount of  Company  resources  and the time of key  personnel,
acquisitions,  equipment  and  software  upgrade  and a large  increase in staff
resulting from systems conversion which is an on-going project.

         The  unusual  loss  for  this  year  was  exacerbated  by a  number  of
extraordinary  events  and one time  charges  and is not  indicative  of  future
results of the Company. For instance,  the Company has recently invested heavily
in its infrastructure to support  anticipated growth that the Company intends to
accomplish through an aggressive acquisitions strategy and marketing program. To
this end,  the Company has put in place a  sophisticated  computer  hardware and
software system and has hired additional mid-management personnel to support its
growth.  The cost of the system is significantly more than estimated and has not
functioned as the Company desired.  It has also taken significant staff time and
resources to implement this system. In addition, on August 27, 1999, the Company
purchased  B & B Fuels  of  Warrensburg  (Albany),  New  York  and has  expended
significant  cash resources to establish its presence in the greater Albany area
and raise the B & B facilities to the Company's standards.  All of these factors
have contributed to the Company's large loss for this year.

                  Net loss for the year ended  December 31, 1999 was $421,722 as
compared to net income of $40,693 for the previous  year.  This net loss was the
result of greater marketing costs, sales promotion,  higher product cost, higher
direct  wages and an  investment  cost on a growing  service  operation,  higher
depreciation   cost  on  a  larger  fleet  of  trucks  and  additional   propane
installations, as well as the extraordinary factors referred to above.

         Depreciation and  amortization  expense for the year ended December 31,
1999 was $521,436,  an increase  from  $451,441 for the year ended  December 31,
1998.  The  increase  was due to the  purchase  of  additional  trucks,  propane
installations  and the  acquisition  of B&B  Fuels'  trucks  and  tanks  and the
facility on Route 46, Rockaway, New Jersey.


<PAGE>
         Year Ended December 1998 Compared to Year Ended December 31, 1997.

         Revenues for the year ended December 31, 1998 were $16,317,668, a 0.38%
decrease over the prior year's revenues of $16,380,992.  The decrease in revenue
for the year ended  December  1998 was due in part to lower product costs during
the second half of fiscal 1998. For example,  the cost to the Company for number
2 home  heating  oil  averaged  $0.42 per gallon for fiscal  1998 as compared to
$0.59 for 1997. In fiscal year 1997, the Company charged customers an average of
$.829 per gallon as opposed to $.711 per gallon for number 2 home  heating  oil,
in fiscal year 1998. Therefore,  although revenue decreased the Company was able
to increase  margins on number 2 home  heating oil by $.052 per gallon in fiscal
year 1998. Additionally, the decrease in revenues was a result of a reduction of
gallons sold of home heating oil.  This reflects  management's  decision to stop
sales of home  heating  oil to two  wholesale  customers  because  of low profit
margins  on such  sales.  Management  believes  that  the  elimination  of these
customers  will result in an increase in overall  profit  margins  from sales of
home heating oil. The Company did, however,  experience a 78% increase in gallon
sales of propane,  from 215,508 gallons during fiscal 1997 to 383,678 gallons in
fiscal 1998 which was the result of an increase in propane customers.

         The Company's  gross profit margin for the year ended December 31, 1998
was 20.1% of sales, a decrease from the 20.5% margin for the  comparable  period
ended December 31, 1997. Selling General & Administration  expenses ("SG&A") for
the Company  decreased by 0.92% from $2,745,963 to $2,720,598 for the year ended
December  31,  1998 as  compared  to December  31,  1997.  These  changes can be
attributed,  in part, to the  reclassification  of expenses from SG&A to cost of
goods sold to better  describe such  expenses.  For example,  during fiscal year
1997, the Company included $108,000 in insurance expense and $80,000 of fuel and
excise tax in SG&A;  however,  in fiscal 1998,  these  expenses were included in
cost of goods sold.  The  decrease  in gross  profit can also be  attributed  to
fluctuating  costs for product  during the second half of 1998 and higher  costs
attributable  to A&O,  which was sold in December 1998. The decrease in SG&A can
also be attributed to decreased executive officers salaries, as certain officers
did not take a bonus in 1998.

         Operating  income for the year ended  December  31, 1998 was $100,705 a
decrease of 53.7% over the  Company's  operating  income for the  previous  year
ended December 31, 1997 of $217,588.  This decrease in income from operations is
related to the increase in one time  expenditures  relating to strengthening the
Company's infrastructure. For example, in fiscal 1998, the Company established a
garage in its Newton Facility which is staffed with one full-time employee.  The
Company  expects that the addition of this garage will help to reduce  operating
expenses  related to its fleet of trucks during fiscal year 1999.  Additionally,
increased costs related to A&O further decreased operating income.

                  Net income for the year ended December 31, 1998 was $40,693, a
46.50%  decrease  in the  Company's  net income of $76,061  for the year  ending
December 31, 1997.  This  decrease in net income is  primarily  attributable  to
lower gross profit and higher depreciation  expenses due to additional tanks and
other equipment.

         Depreciation and amortization expense for the year ended December 31,
1998 was $451,441,
<PAGE>
an increase  from $394,806 for the year ending  December 31, 1997.  Amortization
relates to the amortization of customer lists, being amortized over 15 years and
a Non-Compete Agreement amortized over 5 years, per the agreement.  These relate
to the  acquisition of Connell's Fuel Co. in October 1996. The  amortization  of
the customer list is a non-cash expense.  The amortization  expense for the year
ended  December  31,  1998 was $88,800 as compared to $75,636 for the year ended
December 31, 1997 and  reflects a full year's  amortization  of the  Non-Compete
Agreement and customer  list.  Depreciation  expense for the year ended December
31, 1998 was $376,661  compared to $320,026 for the prior year.  This was due to
the addition of propane  cylinders  and tanks,  and the  purchase of  additional
trucks and other equipment at a cost of approximately $450,000.

         Interest  expense for the year ended  December 31, 1998 was $169,040 as
compared to $211,133 for the year ended December 31, 1997. This decrease was due
to debt restructuring.  For example,  the Company reduced total debt by $235,550
during fiscal 1998.  Also, the Company  converted  certain  short-term  notes to
long-term notes, resulting in a 1.5% lower interest rate.

         During  the  year  ended  December  31,  1998,  the  Company  sold  one
Freightliner delivery truck for a total selling price of $44,000. The book value
of the truck was $20,043, resulting in a gain on sales of equipment of $23,957.

         During the year ended  December 31, 1998, the Company sold A&O and Able
Montgomery for an aggregate selling price of $140,000.  The gain on sale of Able
Montgomery  of $72,739 has been deferred and will be shown over 60 months as the
funds are  collected.  The gain on A&O is shown as excess of  subsidiary  losses
over investment of $54,404.

Liquidity and Capital Resources

         For the year ended  December 31, 1999,  compared to year ended December
31, 1998, the Company's cash position  increased by $2,800,568  from $125,844 to
$2,926,412.  For the year  ended  December  31,  1999,  cash of  $5,867,100  was
generated  from the  Company's  initial  public  offering.  For the  year  ended
December  31,  1998,  cash was  generated  through  operations,  net  income and
collections of customer advance payments.

                  As a result of a  refinancing  in June  1998 with its  primary
financial institution,  the Company has access to $500,000 of credit line funds.
The Company's  credit line was increased from $350,000 to $500,000 at 1/2% below
prime, and its current  outstanding credit line and other debt with the bank was
rolled  into a 3-year term loan in the  principal  amount of  $675,000,  bearing
interest at a rate of  approximately  1% above prime  rate.  As of December  31,
1999,  $201,214 of this line of credit was used by the  Company.  The  agreement
with the bank has a current expiration date of June 30, 2000.

                  The Company  received  net  proceeds  from its initial  public
offering in an amount of $5,867,100.  The Company believes that the net proceeds
of this offering, coupled with the refinancing and income from operations,  will
fulfill  the  Company's  working  capital  needs for the next 18 months.  As the
Company continues to grow, and strengthen its infrastructure, to position


<PAGE>
itself for additional  growth,  bank  borrowings,  or other debt  placements and
equity offerings may be considered, in part, or in combination, as the Company's
situation warrants.

                  Seasonality

                  The Company's operations are subject to seasonal fluctuations,
with a majority of the Company's  business occurring in the late fall and winter
months. Approximately 70% of the Company's revenues are earned and received from
October  through  March,  and the  overwhelming  majority of such  revenues  are
derived from the sale of home heating  products  including  propane gas and fuel
oil. However,  the seasonality of the Company's  business is offset, in part, by
an increase in revenues from the sale of HVAC products and services,  diesel and
gasoline fuels during the spring and summer months,  due to the increased use of
automobiles and construction apparatus.

                  From  May   through   September,   Able  Oil  can   experience
considerable reduction of retail heating oil sales. Similarly,  Able Propane can
experience up to 80% decrease in heating related propane sales during the months
of April to September,  which is offset  somewhat by an increase of pool heating
and cooking fuel.

                  Over 90% of Able  Melbourne's  revenues  are derived  from the
sale of diesel fuel for construction  vehicles,  and commercial and recreational
sea-going vessels during Florida's fishing season which begins in April and ends
in November.  Only a small percentage of Able  Melbourne's  revenues are derived
from the sale of home  heating  fuel.  Most of these sales  occur from  December
through March, Florida's cooler months.

         Year 2000

         Prior to the new  year,  the  Company  took  steps to  ensure  that its
systems and equipment  would be Year 2000  compliant.  In addition,  the Company
sought assurances of Year 2000 compliance from its key suppliers and other third
parties with whom it conducts business.  The costs incurred to address Year 2000
issues were immaterial. To date, neither the Company nor its principal suppliers
have  experienced  any  interruptions  or problems  related to Year 2000 issues.
Nonetheless,  the Company is unable to assure that any failure of its systems or
those of any third party with whom it conducts  business due to Year 2000 issues
will not materially  and adversely  affect its financial  condition,  results of
operations and cash flows.
<PAGE>
ITEM 7.       FINANCIAL STATEMENTS

         All  financial  information  required by this Item is  attached  hereto
beginning on Page F-1.

ITEM 8.       CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
              FINANCIAL DISCLOSURE

         None.


ITEM 9.       DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
              COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT

Directors and Executive Officers

         The directors and executive officers of the Company are as follows:

<TABLE>
<CAPTION>
Name                                      Age        Position

<S>                                        <C>       <C>
Timothy Harrington                         31        Chief Executive Officer, Chairman of the Board
                                                     and Secretary
Christopher P. Westad                      45        President, Chief Financial Officer and Director
James Purcaro                              37        Director
Gregory Sichenzia                          37        Director
Patrick O'Neill                            39        Director
</TABLE>

         Set forth below is a brief  background  of the  executive  officers and
directors of the Company, based on information supplied by them.

     TIMOTHY  HARRINGTON,  serves  as the  Company's  Chief  Executive  Officer,
Chairman of the Board, and Secretary.  In 1989, Mr. Harrington  founded Able Oil
Company,  Inc., and since that time, has served as Able Oil's  President,  Chief
Executive  Officer and Chairman of the Board. Mr.  Harrington has also served as
the Chief  Executive  Officer  and  Chairman of the Board of  Directors  of Able
Energy, Able Melbourne and Able Propane since their respective inception.

     CHRISTOPHER P. WESTAD, serves as the President, Chief Financial Officer and
a Director of the Company.  Since  September  1996, Mr. Westad has served as the
President of Able Energy and Able Propane.  From 1991 through  1996,  Mr. Westad
was a market Manager for  Ferrellgas  Partners,  L.P., a company  engaged in the
retail distribution of liquefied petroleum gas.
<PAGE>
     From 1977  through  1991,  Mr.  Westad  served  in a number  of  management
positions with RJR Nabisco.  In 1975, Mr. Westad  received a Bachelor of Arts in
Business and Public Management from Long Island University--Southampton.

     JAMES  PURCARO,  has served as a director  to the Company  since  September
1996.  Since 1986, Mr.  Purcaro has served as the president and chief  executive
officer of Kingsland Trade Print Group, Inc., a commercial printing company.

     GREGORY  SICHENZIA,  has served as a director to the Company  since  August
1999. Mr.  Sichenzia is a partner in the law firm of Sichnezia,  Ross & Friedman
LLP in New York,  New York and has been since May 1998. He had been a partner of
Singer  Zamansky LLP in New York, New York,  since November 1996.  Prior thereto
and since August 1994,  he had been an  associate  attorney at Schneck  Waeltman
Hasmall & Mischel LLP in New York City.

     PATRICK O'NEILL, has served as a director to the Company since August 1999.
Mr.  O'Neill has served as the President of Fenix  Investment  and  Development,
Inc., a real estate  company based in  Parsippany,  New Jersey for the past five
years.  Prior  to  this,  Mr.  O'Neill  served  as Vice  President  of  Business
Development for AvisAmerica, a Pennsylvania based home manufacturer. Mr. O'Neill
holds a B.S. from the United States Military  Academy,  and has been awarded the
Army Achievement Medal for his work with the Army Corp. of Engineers.

COMMITTEES OF THE BOARD OF DIRECTORS

         The Board of Directors has established a Compensation  Committee and an
Audit  Committee  consisting  of at least  two  directors  who are not  salaried
officers of the Company.

         The purpose of the  Compensation  Committee is to review the  Company's
compensation of its executives,  to make determinations  relative thereto and to
submit  recommendations  to the Board of  Directors  with respect  thereto.  The
Compensation  Committee  also  selects the  persons to whom  options to purchase
shares of the  Company's  Common  Stock under the 1999 Stock Option Plan will be
granted and to make various other determinations with respect to such Plan.

         The purpose of the Audit Committee is to provide  general  oversight of
audit, legal compliance and potential conflict of interest matters.

COMPENSATION OF DIRECTORS

         The Company has not paid  compensation  to any  director  for acting in
such capacity.  The Company is currently reviewing its policy on compensation of
outside directors and may pay outside directors in the future.

         Directors  serve until the next annual meeting of stockholders or until
their successors are elected and qualified.  Officers serve at the discretion of
the Board of Directors. Directors are reimbursed for travel expenses.

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

         Based solely upon a review of Forms 3, 4 and 5, and amendments thereto,
furnished to the Company  during  fiscal year 1999,  the Company is not aware of
any  director,  officer  or  beneficial  owner of more than ten  percent  of the
Company's  Common Stock that failed to file reports required by Section 16(a) of
the Securities Exchange Act of 1934 on a timely basis during
<PAGE>
fiscal year 1999.

ITEM 10.      EXECUTIVE COMPENSATION

         The following table sets forth certain summary information with respect
to the compensation  paid to the Company's Chief Executive Officer and President
for services  rendered in all  capacities  to the Company for the fiscal  period
ended  December  31,  1999.  Other  than as listed  below,  the  Company  had no
executive  officers  whose total annual salary and bonus  exceeded  $100,000 for
that fiscal year:
<TABLE>
<CAPTION>

                          ANNUAL COMPENSATION                                            LONG-TERM COMPENSATION
                            AWARDS                    PAYOUTS

     Name and         Year       Salary       Bonus       Other Annual     Restricted   Securities       LTIP      All Other
    Principal                      ($)         ($)        Compensation       Stock      Underlying     Payouts      Compen-
     Position                                                 ($)            Award       Options /       ($)       sation ($)
                                                                                         SARs (#)
<S>                   <C>        <C>         <C>           <C>    <C>          <C>      <C>             <C>           <C>
Timothy
Harrington,
Chief
Executive
Officer               1999       225,000     30,000        17,000 (1)          -             -            -            -
                      1998       103,000        -              -               -             -            -            -
                      1997       100,000     80,000            -               -             -            -            -

Christopher P.
Westad,
President             1999       100,000     25,000        5,700 (2)           -             -            -            -
                      1998          -           -              -               -             -            -            -
                      1997          -           -              -               -             -            -            -
</TABLE>

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

     (1)  Represents  $7,400 in car  allowance,  and  $9,600 in travel  expenses
pursuant to his employment agreement with the Company.

     (2) Represents $5,700 in car allowance pursuant to his employment agreement
with the Company.

         No option grants were made to named  executive  officers  during fiscal
year ended December 31, 1999.

         No named executive held unexercised options as at December 31, 1999.

Employment Arrangements

         Timothy Harrington and Christopher P. Westad have three year employment
agreements with the Company.  Timothy  Harrington is retained as Chief Executive
Officer of the Company at an annual  salary of $225,000.  Christopher  Westad is
retained as  President of the Company at an annual  salary of $100,000.  Each of
the Messrs.  Harrington  and Westad are  entitled  to bonuses  pursuant to their
employment  agreements if the Company meets certain  financial  targets based on
sales,  profitability and good management goals as predetermined by the Board of
Directors or compensation  committee and other subjective criteria as determined
by the Board of Directors or
<PAGE>
compensation  committee.  Such bonuses,  plus all other  bonuses  payable to the
executive management of the Company, shall not exceed in the aggregate, a "bonus
pool"  which  shall  equal  up to 5% of the  Company's  earnings  before  taxes,
depreciation and amortization ("EBITDA") for 1999, provided the Company achieves
at least  $800,000  in EBITDA,  10% of EBITDA for 2,000 and 2001,  provided  the
Company achieves at least $3,000,000 and $5,000,000,  respectively, of EBITDA in
each of such years. The employment  agreements also provide for reimbursement of
reasonable  business  expenses.   Timothy  Harrington  also  receive  additional
compensation  including  Company  automobile,  insurance and retirement  savings
matched  contributions  by  the  Company  and  such  other  perquisites  as  are
customary.  The employment agreements for each of Messrs.  Harrington and Wested
contain a covenant not to compete whereby  Messrs.  Harrington and Wested agree,
for the term of the  employment  agreements  and  until one year  following  the
termination of the  agreements,  not to (i) persuade any customer of the Company
to cease or reduce the amount of business it does with the Company; (ii) solicit
the  Company's  customers  for their own benefit;  or (iii)  persuade any of the
Company's employees to leave the employ of the Company.

         In the event that there is a change in control of the Company,  through
an  acquisition  where any  person  acquires  more than 50% of the shares of the
Company,  a  consolidation  or merger with another  corporation  resulting in at
least 50% of the voting shares of the surviving  corporation being controlled by
a new  acquirer or the sale  directly or  otherwise  of all of the assets of the
Company to a third party in a non-distress situation, then the Company shall pay
to Timothy Harrington a lump sum payment equal to one year's salary.

EMPLOYEE BONUS POOL

         The  Company has  adopted an  Employee  Bonus  Pool,  pursuant to which
Management   may,  at  its  own   discretion,   award  employees  for  exemplary
performance.  The Company  has  allocated  $25,000,  $40,000 and $50,000 for the
years 1999, 2000 and 2001, respectively,  for such purposes. Management may not,
however,  award  employees  bonuses  from the  Employee  Bonus  Pool (i) if such
bonuses would result in negative earning before taxes for the year in which such
bonuses are to be granted,  or (ii) if the Company  does not have net profits in
such year.

Employee Stock Option Plan

         The Company has adopted a Stock Option Plan (the "1999 Plan"), pursuant
to which 300,000 shares of Common Stock are reserved for issuance.

         The  1999  Plan is  administered  by the  board of  directors,  or by a
committee with at least two directors as delegated by the board of directors who
determine among other things,  those individuals who shall receive options,  the
time period  during which the options may be partially or fully  exercised,  the
number of shares of Common Stock  issuable  upon the exercise of the options and
the option exercise price.

         The 1999 Plan's duration is for a period of ten years. Options under
the 1999 Plan must
<PAGE>
be issued within ten years from the effective date of the 1999 Plan. Options may
be granted to officers,  directors,  consultants,  key  employees,  advisors and
similar  parties who provide their skills and expertise to the Company.  Options
granted under the 1999 Plan may be exercisable for up to ten years,  may require
vesting,  and shall be at an  exercise  price all as  determined  by the  board.
Options will be  non-transferable  except to an option holder's personal holding
company or registered  retirement savings plan and except by the laws of descent
and  distribution or a change in control of the Company,  as defined in the 1999
Plan, and are exercisable  only by the  participant  during his or her lifetime.
Change in control  includes (i) the sale of  substantially  all of the assets of
the Company and merger or consolidation with another,  or (ii) a majority of the
board  changes  other than by  election  by the  shareholders  pursuant to board
solicitation or by vacancies  filled by the board caused by death or resignation
of such person.

         If a  participant  ceases  affiliation  with the  Company  by reason of
death,  permanent disability or the retirement of an Optionee either pursuant to
a pension or retirement plan adopted by the Company or on the normal  retirement
date prescribed from time to time by the Company, the option remains exercisable
for three months from such  occurrence  but not beyond the  option's  expiration
date. Other termination  gives the participant three months to exercise,  except
for termination for cause which results in immediate termination of the option.

         Options  granted  under  the  1999  Plan,  at  the  discretion  of  the
compensation  committee  or the board,  may be  exercised  either with cash,  by
certified check or bank cashier's check, Common Stock having a fair market equal
to the cash  exercise  price,  the  participant's  promissory  note,  or with an
assignment  to the Company of  sufficient  proceeds  from the sale of the Common
Stock acquired upon exercise of the Options with an  authorization to the broker
or selling agent to pay that amount to the Company,  or any  combination  of the
above.

         The  exercise  price of an option may not be less than the fair  market
value per share of Common  Stock on the date that the option is granted in order
to receive  certain tax benefits  under the Income Tax Act of United States (the
"ITA").  The exercise  price of all future  options will be at least 100% of the
fair market  value of the Common  Stock on the date of grant of the  options.  A
benefit  equal to the amount by which the fair market value of the shares at the
time the  employee  acquires  them  exceeds the total of the amount paid for the
shares or the amount paid for the right to acquire the shares shall be deemed to
be received  by the  employee  in the year the shares are  acquired  pursuant to
paragraph  7(1) of the ITA.  Where the exercise  price of the option is equal to
the fair market value of the shares at the time the option is granted, paragraph
110(1)(d) of the ITA allows a deduction  from income equal to one quarter of the
benefit as calculated  above.  If the exercise  price of the option is less than
the fair market value at the time it is granted,  no deduction  under  paragraph
110(1)(d) is permitted. Options granted to any non- employees, whether directors
or consultants or otherwise  will confer a tax benefit in  contemplation  of the
person becoming a shareholder pursuant to subsection 15(1) of the ITA.

         Any  unexercised   options  that  expire  or  that  terminate  upon  an
employee's  ceasing to be  employed by the Company  become  available  again for
issuance under the 1999 Plan.
<PAGE>
         The 1999 Plan may be  terminated or amended at any time by the board of
directors,  except  that the  number  of shares of  Common  Stock  reserved  for
issuance  upon the  exercise of options  granted  under the 1999 Plan may not be
increased without the consent of the shareholders of the Company.

ITEM 11.      SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         The  following  table sets forth,  as of  December  31,  1999,  certain
information  concerning  beneficial  ownership  of shares of Common  Stock  with
respect  to (i)  each  person  known  to the  Company  to own 5% or  more of the
outstanding shares of Common Stock, (ii) each director of the Company, (iii) the
executive  officers of the Company,  and (iv) all  directors and officers of the
Company as a group:
<TABLE>
<CAPTION>

                                          Number of                 Approximate
                                           Shares                  Percentage of
Name*                                   Beneficially                  Common
                                            Owned                     Stock**

<S>                                               <C>                   <C>
Timothy Harrington                                1,000,000             50%
All Officers and                                  1,000,000             50%
Directors as a Group (1
persons)
--------------------------------  -------------------------  -------------------------
</TABLE>

     * Except as noted above, the address for the above identified  officers and
directors of the Company is c/o Able Energy,  Inc., 344 Route 46, Rockaway,  New
Jersey 7866.

     **  Percentages  are based upon the  assumption  that the  shareholder  has
exercised  all of the  currently  exercisable  options  he or she owns which are
currently   exercisable  or  exercisable  within  60  days  and  that  no  other
shareholder has exercised any options he or she owns.

ITEM 12.      CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         None.

<PAGE>
ITEM 13.       EXHIBITS, LIST AND REPORTS ON FORM 8-K

         The  Company  has not filed any  reports  on Form 8-K  during  the last
quarter of the period covered by this report.

Exhibits
<TABLE>
<CAPTION>

         The following Exhibits are filed as part of this Report:

       Exhibit

       Number              Description

         <S>               <C>
         3.1               Articles of Incorporation of Registrant*
         3.2               By-Laws of Registrant*
         4.1               Specimen Common Stock Certificate*
         5.1               Opinion of Sichenzia, Ross & Friedman LLP***
         10.1              Form of Consulting  Agreement  with the Walsh Manning  Securities, LLC***
         10.2              1999 Stock Option Plan*** 10.3 Lease of Company's  Facility at 344  Route  46,  Rockaway,  New  Jersey*
         10.4              Form of employment agreement between the Company and Timothy Harrington, to be executed on or before the
                           Effective Date***
         10.5              Form of employment agreement between the Company and Christopher P. Wested, to be executed on or before
                           the Effective Date***
         10.6              $600,000 Revolving Credit Facility and $350,000 Line of Credit with PNC Bank, National Association dated
                           October 23, 1996, and amendment thereto, dated June 12, 1998, extending the Line of Credit to $500,000*
         10.7              $675,000 Term Loan Agreement dated June 11, 1998 by and between the Company and PNC Bank, National
                           Association and exhibits thereto, including Pledge Agreement by and between Timothy Harrington and PNC
                           Bank, Guaranty and Suretyship Agreement by and between the Company and PNC Bank, and Pledge Agreement by
                           and between the Company and PNC Bank*
         10.8              Marketing Alliance Agreement, dated March 1, 1998, between the Company and AllEnergy Marketing Company,
                           L.L.C., wherby the Company obtained the exclusive right to market natural gas supplied by AllEnergy in
                           specified areas**
         10.9              In tank agreement between the Company and Mieco, Inc., dated May 11, 1998, for the storage of the Mieco's
                           petroleum products in the Company's tank facilities**

<PAGE>
         10.10             Form of Company's Pre-Purchase Enrollment Form*
         10.11             Oil Supply Agreement between the Company and Mieco, Inc., dated May 19, 1998**
         10.12             Letter agreement, dated July 3, 1998, between the Company and Mieco, Inc. modifying the Oil Supply
                           Agreement, dated May 19, 1998, whereby the Company agreed to increase the amount of oil purchased from
                           Mieco**
         10.13             Oil Supply Agreement between the Company and Amarada Hess Corporation, dated July 30, 1998**
         10.14             Oil Supply Agreement between the Company and Bayway (TOSCO)Refining Company, dated March 27, 1998**
         10.15             Oil Supply Agreement between the Company and Koch Refining Company, L.P., dated March 17, 1998**
         10.16             Fuel Purchase Agreement (Natural Gas) between the Company and Ferrellgas, dated September 3, 1996**
         10.17             Fuel Purchase Agreement (Propane) between the Company and Keystone Propane Service, Inc., dated July 28,
                           1998**
         10.18             Lease between the Company and Summit Leasing Corporation ("Summit"), dated December 3, 1997**
         10.19             Franchise Agreement, dated December 31, 1998, between the Company and Andrew Schmidt regarding sale of
                           Able Oil Company Montgomery, Inc. as a franchise***
         10.20             Stock Purchase Agreement, dated December 31, 1998, between the Company and Andrew Schmidt regarding the
                           sale of stock of Able Oil Company Montgomery, Inc. by the Company to Mr. Schmidt***
         10.21             Pledge and Security Agreement, dated December 31, 1998, between the Company and Andrew Schmidt regarding
                           the pledge of stock of Able Oil Company Montgomery, Inc.***
         10.22             $140,000 principal amount, 9.5% Promissory Note, dated December 31, 1998, between the Company and Andrew
                           Schmidt regarding the sale of stock of Able Oil Company Montgomery, Inc. by the Company to Mr. Schmidt
         10.23             Stock Sale Agreement, dated December 31, 1998, between the Company and Owl Environmental, Inc. regarding
                           the sale of stock of A&O Environmental Services, Inc. by the Company to Owl Environmental, Inc.*
         21.1              List of Subsidiaries of Registrant*
         27.1              Financial Data Schedule
</TABLE>

--------------
(*)      Reference  is  made to the  Company's  Registration  Statement,  filing
         Number 333-51909, filed with the SEC on July 15, 1998.


<PAGE>
(**)     Reference  is  made to the  Company's  Registration  Statement,  filing
         Number 333-51909, filed with the SEC on November 6, 1998.

(***)    Reference  is  made to the  Company's  Registration  Statement,  filing
         Number 333-51909, filed with the SEC on April 15, 1999.

(****)   Reference  is  made to the  Company's  Registration  Statement,  filing
         Number 333-51909, filed with the SEC on May 17, 1999.


<PAGE>
                                ABLE ENERGY, INC.

                           DECEMBER 31, 1999 AND 1998

                                 C O N T E N T S
<TABLE>
<CAPTION>

                                                                                                      PAGE

CONSOLIDATED FINANCIAL STATEMENTS:

<S>                                                                                                      <C>
         ACCOUNTANTS' REPORT                                                                           F-2

         CONSOLIDATED BALANCE SHEET                                                               F-3 - F-4

         CONSOLIDATED STATEMENT OF OPERATIONS                                                          F-5

         CONSOLIDATED STATEMENT OF CHANGES
            IN STOCKHOLDERS' EQUITY                                                                    F-6

         CONSOLIDATED STATEMENT OF CASH FLOWS                                                     F-7 - F-8

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS                                               F-9 - F-27


</TABLE>



















                                       F-1

<PAGE>
To The Shareholder
Able Energy, Inc.
Rockaway, New Jersey  07866

                          Independent Auditor's Report

We have audited the accompanying consolidated balance sheet of Able Energy, Inc.
and subsidiaries as of December 31, 1999 and the related consolidated statements
of operations,  changes in  Stockholders'  equity,  and cash flows for the years
ended  December  31,  1999  and  1998.   These  financial   statements  are  the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these financial statements based on our audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards  require that we plan and perform the audit to obtain reasonable
assurance   about  whether  the  financial   statements  are  free  of  material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.

In our  opinion,  based  on our  audit  the  consolidated  financial  statements
referred to above  present  fairly,  in all  material  respects,  the  financial
position of Able Energy,  Inc. and subsidiaries as of December 31, 1999, and the
results of their  operations  and their cash flows for the years ended  December
31, 1999 and 1998 in conformity with generally accepted accounting principles.

Rockaway, New Jersey
March 16, 2000

                                       F-2




<PAGE>
                       ABLE ENERGY, INC. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEET

                                DECEMBER 31, 1999

                                     ASSETS
<TABLE>
<CAPTION>

                                                                                                               1999

Current Assets:

<S>                                                                                                                 <C>
    Cash                                                                                                            $ 2,926,412
    Accounts Receivable (Less Allowance for Doubtful
       Accounts of 1999 ($157,974)                                                                                    1,996,500
    Inventory                                                                                                           229,979
    Notes Receivable - Current Portion                                                                                   61,748
    Miscellaneous Receivable                                                                                             22,640
    Prepaid Expense                                                                                                      48,826
    Prepaid Expense - Income Taxes                                                                                      119,951
    Deferred Income Tax                                                                                                  48,270
    Due From Officer                                                                                                     44,690
                                                                                                                  -------------
        Total Current Assets                                                                                          5,499,016
                                                                                                                    -----------

Property and Equipment:

    Land                                                                                                                451,925
    Building                                                                                                          1,008,250
    Trucks                                                                                                            2,236,508
    Fuel Tanks                                                                                                          836,790
    Machinery and Equipment                                                                                             346,198
    Leasehold Improvements                                                                                              187,364
    Cylinders                                                                                                           319,490
    Office Furniture and Equipment                                                                                       14,841
                                                                                                                  -------------
                                                                                                                      5,401,366

    Less: Accumulated depreciation                                                                                    1,266,201
                                                                                                                    -----------
        Net Property and Equipment                                                                                    4,135,165
                                                                                                                    -----------

Other Assets:

    Deposits                                                                                                             94,625
    Notes Receivable - Less Current Portion                                                                             126,863
    Customer List, Less Amortization of 1999 ($125,045)
    Covenant Not to Compete, Less Amortization of 1999                                                                  485,805
     ($125,123)

         Total Other Assets                                                                                             158,444
                                                                                                                   ------------
                                                                                                                        865,737

        Total Assets

                                                                                                                    $10,499,918
                                                                                                                   ============
</TABLE>

                   See Accompanying Notes and Auditor's Report
                                       F-3
<PAGE>
                       ABLE ENERGY, INC. AND SUBSIDIARIES

                             BALANCE SHEET (Cont'd)

                                DECEMBER 31, 1999

                       LIABILITIES & STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>

                                                                                                                           1999

Current Liabilities:

<S>                                                                                                                 <C>
    Accounts Payable                                                                                                $ 1,638,699
    Note Payable - Bank                                                                                                 201,214
    Current Portion of Long-Term Debt                                                                                   789,978
    Covenant Not To Compete                                                                                                   -
    Accrued Expenses                                                                                                    260,818
    Taxes Payable                                                                                                             -
    Customer Advance Payments                                                                                           156,738
    Income Taxes Payable - Prior                                                                                              -
    Current Portion of Deferred Income                                                                                   14,548
    Escrow Deposits                                                                                                      15,000
                                                                                                                   ------------
        Total Current Liabilities                                                                                     3,076,995

Deferred Income: Less current portion                                                                                    53,342
Deferred Income Taxes                                                                                                    56,201
Covenant Not To Compete: less current portion                                                                                 -
Long Term Debt: less current portion                                                                                  1,529,444
                                                                                                                    -----------
        Total Liabilities                                                                                             4,715,982
                                                                                                                    -----------

Stockholders' Equity:

    Common Stock

    Authorized 10,000,000 Par Value $.001 per share Issued
      and Outstanding 2,000,000 Shares

    Paid in Surplus                                                                                                       2,000
    Retained Earnings                                                                                                 5,662,775
        Total Stockholders' Equity                                                                                      119,161
                                                                                                                    -----------
                                                                                                                      5,783,936

        Total Liabilities and Stockholders' Equity

                                                                                                                    $10,499,918
                                                                                                                    ===========
</TABLE>

                   See Accompanying Notes and Auditor's Report
                                       F-4

<PAGE>
                       ABLE ENERGY, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENT OF OPERATIONS

                     YEARS ENDED DECEMBER 31, 1999 AND 1998
<TABLE>
<CAPTION>

                                                                                         1999               1998
                                                                                         ----               ----
<S>                                                                                      <C>                 <C>
Net Sales                                                                                $19,670,365         $16,317,668

Cost of Sales                                                                             16,320,008          13,044,924
                                                                                         -----------         -----------

     Gross Profit                                                                          3,350,357           3,272,744
                                                                                         -----------         -----------

Expenses

     Selling, General and Administrative Expenses                                          3,294,964           2,720,598
     Depreciation and Amortization Expense                                                   521,436             451,441
                                                                                       -------------          ----------
        Total Expenses                                                                     3,816,400           3,172,039
                                                                                       -------------          ----------

     Income From Operations                                                                (466,043)             100,705
                                                                                       ------------           ----------

Other Income (Expenses):

     Interest and Other Income                                                              139,804             115,668
     Interest Expense                                                                      (187,370)           (169,040)
                                                                                       ------------         -----------
        Total Other Income (Expense)                                                        (47,566)            (53,372)
                                                                                       ------------        ------------

     Income (Loss) Extraordinary Item and

       Before Provision for Income Taxes                                                   (513,609)             47,333

Provision (Reduction) for Income Taxes                                                      (36,868)              6,640
                                                                                       ------------        -------------

     Net Income (Loss) - Continuing Operations                                             (476,741)             40,693

Extraordinary Item Net of Income Taxes                                                       55,019               -
                                                                                       ------------         ------------

      Net Income (Loss)                                                                 $  (421,722)        $     40,693
                                                                                        ===========         ============

Net Income (Loss) Per Share - Continuing

   Operations                                                                           $     (.31)         $       .04
                                                                                        ===========         ============

Extraordinary Gain - Per Share                                                          $      .04          $         -
                                                                                        ============        ============

      Net Income (Loss) Per Share                                                       $     (.27)         $       .04
                                                                                        ============        ============

Weighted Average number of Common Shares

 Outstanding                                                                            $ 1,526,027         $ 1,000,000
                                                                                        ===========         ===========
</TABLE>



                   See Accompanying Notes and Auditor's Report
                                       F-5
<PAGE>
                       ABLE ENERGY, INC. AND SUBSIDIARIES

            CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY

                     YEARS ENDED DECEMBER 31, 1999 AND 1998
<TABLE>
<CAPTION>

                                             Common Stock
                                           .001 Par Value

                                                                  Additional                     Total
                                                                    Paid-in       Retained    Stockholders'
                                        Shares        Amount        Surplus       Earnings       Equity

<S>               <C>                    <C>      <C>            <C>            <C>           <C>
Balance - January 1, 1998 ......         1,000    $         1    $     3,999    $   500,190   $   504,190

Net Income .....................        40,693         40,693
                                   -----------    -----------    -----------    -----------   -----------

Balance - December 31, 1998 ....         1,000    $         1    $     3,999    $   540,883   $   544,883

Common Stock Split - 1,000 for 1       999,000            999           (999)          --            --

Sale of Common Stock ...........     1,000,000          1,000      5,659,775           --       5,660,775

Net (Loss) .....................      (421,722)      (421,722)
                                   -----------    -----------    -----------    -----------   -----------

Balance - September 30, 1999 ...     2,000,000    $     2,000    $ 5,662,775    $   119,161   $ 5,783,936
                                   ===========    ===========    ===========    ===========   ===========


</TABLE>














                   See Accompanying Notes and Auditor's Report
                                       F-6

<PAGE>
                       ABLE ENERGY, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENT OF CASH FLOWS

                      YEAR ENDED DECEMBER 31, 1999 AND 1998

<TABLE>
<CAPTION>
Cash Flows From Operating Activities                                                            1999                   1998
------------------------------------                                                            ----                   ----
<S>                                                                                      <C>                     <C>
   Net Income (Loss)                                                                     $ (421,722)             $   40,693
   Adjustments to Reconcile Net Income to Cash
   used by Operating Activities:
      Depreciation and Amortization                                                          521,436                451,441
      Gain on Sale of Equipment                                                                    -               (23,957)
      Excess of Subsidiary Losses over Investment                                                  -               (54,404)
     (Increase) Decrease in:
        Accounts Receivables                                                             (1,338,631)               (10,408)
        Inventory                                                                          (100,496)                 55,172
        Prepaid Expenses                                                                    (44,875)              (140,888)
        Deposits                                                                                (88)               (12,575)
      Increase (Decrease) in:
        Accounts Payable                                                                     949,453                193,076
        Accrued Expenses                                                                     198,574               (22,709)
        Payroll Taxes Payable                                                                      -                  1,450
        Customer Advance Payments                                                          (199,245)                 52,789
        Income Taxes Payable                                                                (49,260)               (53,188)
        Deferred Income Taxes                                                                  5,600                 31,776
        Deferred Income                                                                      (4,849)                  -
                                                                                        -----------              ----------
         Net Cash Provided By Operating Activities                                         (484,103)                508,268
                                                                                         ----------              ----------


</TABLE>


                   See Accompanying Notes and Auditor's Report
                                       F-7

<PAGE>
                       ABLE ENERGY, INC. AND SUBSIDIARIES

                  CONSOLIDATED STATEMENT OF CASH FLOWS (Cont'd)

                      YEAR ENDED DECEMBER 31, 1999 AND 1998

<TABLE>
<CAPTION>
                                                                                                   1999                  1998
                                                                                                   ----                  ----
Cash Flows From Investing Activities

   Increase in Stockholders' Equity - Sale of        Subsidiary
<S>                                                                                          <C>                    <C>
   Increase in Deposits                                                                      $        -             $ 105,930
   Sale of Equipment                                                                           (80,254)                     -
   Sales of Subsidiary                                                                                -                44,000
   Purchase of Property and Equipment                                                                 -               140,000
   Sale (Purchase) of Intangibles - Subsidiary                                              (2,751,996)             (455,220)
   Note Receivable - Sale of Equipment                                                        (139,850)                27,515
   Reduction in Property and Equipment - Net Sale                                                 5,567              (43,536)
      of Subsidiary

   (Increase) Decrease in Shareholder's Loan                                                          -                 8,768
   Other Receivables                                                                           (10,517)                 8,354
   Note Receivable - Sale of Subsidiary                                                         (9,566)                 1,415
   Note Receivable - Montgomery Truck                                                             7,415             (140,000)
         Net Cash Used By Investing Activities                                                 (18,057)                 -
                                                                                           -----------             ----------
                                                                                            (2,997,258)             (302,774)
                                                                                            ----------             ----------
Cash Flows From Financing Activities

   Increase in Notes Payable

   Decrease in Notes Payable                                                                  1,667,525            1,285,528
   Funds from Sale of Common Stock                                                          (1,046,371)           (1,521,082)
         Net Cash Provided (Used) By Financing                                                5,660,775               -
                                                                                             ----------           ----------
          Activities

                                                                                              6,281,929            (235,554)
                                                                                             ----------         ------------
Net Increase (Decrease) In Cash

                                                                                              2,800,568             (30,060)
Cash - Beginning of Year

Cash - End of Year                                                                              125,844             155,904
                                                                                            -----------           -----------
                                                                                             $2,926,412         $   125,844
                                                                                             ==========           ===========
The Company had interest cash expenditures of:

The Company had tax cash expenditures of:                                                   $   187,370         $   169,728
                                                                                                 48,962             108,188

</TABLE>
                   See Accompanying Notes and Auditor's Report
                                       F-8
<PAGE>
                       ABLE ENERGY, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                           DECEMBER 31, 1999 AND 1998

Note 1         Basis of Presentation

                         Able  Energy,  Inc.  was  incorporated  in the state of
                    Delaware on March 13, 1997. Mr. Timothy Harrington exchanged
                    his stock in the  following  companies:  Able Oil Company (a
                    New Jersey corporation),  Able Oil Company Montgomery,  Inc.
                    (a Pennsylvania corporation),  A & O Environmental Services,
                    Inc. (a New Jersey corporation), Able Oil Melbourne, Inc. (a
                    Florida  corporation)  and his 99% interest in Able Propane,
                    LLC for 1,000  shares of Able  Energy,  Inc.  and became its
                    sole  shareholder.  In December 1998, the Company sold A & O
                    Environmental   Services,   Inc.   and  Able   Oil   Company
                    Montgomery, Inc.(See Note 16).

                         On August 27, 1999, the Company, through a newly formed
                    wholly  owned  subsidiary,   Able  Energy  New  York,  Inc.,
                    purchased  the  assets  of B & B Fuels of  Warrensburg,  New
                    York.  This  acquisition  was  treated  as a  purchase.  The
                    operations of this company are included from August 27, 1999
                    to December 31, 1999.

                         On August 31, 1999, the Company, through a newly formed
                    wholly  owned   subsidiary,   Able  Energy  Terminal,   LLC,
                    purchased  the  facility  on Route  46,  Rockaway,  NJ.  The
                    facility  has two tenants  (see Note 4). The  operations  of
                    this company are included from September 1, 1999 to December
                    31, 1999.

Note 2         Summary of Significant Accounting Policies

                  Nature of Operations

                         Able Oil Company,  Able  Melbourne  and Able Energy New
                    York,  Inc. are full service oil  companies  that market and
                    distribute  home  heating  oil,  diesel fuel and kerosene to
                    residential  and  commercial   customers  operating  in  the
                    northern New Jersey,  Melbourne,  Florida,  and Warrensburg,
                    New York respectively.  Able Propane, which was incorporated
                    in July 1996, installs propane tanks which it owns and sells
                    propane   for  heating   and   cooking,   along  with  other
                    residential and commercial uses.

                                       F-9

<PAGE>
                       ABLE ENERGY, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Cont'd)

                           DECEMBER 31, 1999 AND 1998

Note 2         Summary of Significant Accounting Policies (cont'd)

                  The Company's operations are subject to seasonal  fluctuations
                  with a majority of the  Company's  business  occurring  in the
                  late  fall  and  winter  months.   Approximately  70%  of  the
                  Company's  revenues  are  earned  and  received  from  October
                  through March, and the overwhelming  majority of such revenues
                  are derived from the sale of home heating fuel.  However,  the
                  seasonality of the Company's  business is offset,  in part, by
                  the increase in revenues  from the sale of diesel and gasoline
                  fuels during the spring and summer months due to the increased
                  use of automobiles and construction apparatus.

                  Principles of Consolidation

                  The consolidated  financial statements include the accounts of
                  Able Energy, Inc. and its subsidiaries.  The minority interest
                  of 1% in Able Propane,  LLC is so immaterial  and has not been
                  shown  separately.  All  material  intercompany  balances  and
                  transactions were eliminated in consolidation.

                  Inventories

                  Inventories  are valued at the lower of cost (first in,  first
                  out method) or market.

                  Property and Equipment

                  Property  and  equipment  are stated at cost less  accumulated
                  depreciation.   Depreciation   is   provided   by  using   the
                  straight-line  method based upon the estimated useful lives of
                  the assets (5 to 40 years).

                  For  income  tax  basis,   depreciation  is  calculated  by  a
                  combination of the straight-line and modified accelerated cost
                  recovery systems established by the Tax Reform Act of 1986.

                  Expenditures  for  maintenance  and  repairs  are  charged  to
                  expense as incurred  whereas  expenditures  for  renewals  and
                  betterments are capitalized.

                  The cost and related  accumulated  depreciation of assets sold
                  or  otherwise  disposed of during the period are removed  from
                  the  accounts.  Any gain or loss is  reflected  in the year of
                  disposal.

                                      F-10
<PAGE>
                       ABLE ENERGY, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Cont'd)

                           DECEMBER 31, 1999 AND 1998

Note 2         Summary of Significant Accounting Policies (cont'd)

                  Intangible Assets

                  Intangibles  are  stated  at cost and  amortized  as  follows:
                  Customer  Lists of  $571,000  and  Covenant  Not To Compete of
                  $183,567 related to the Connell's Fuel Oil Company acquisition
                  on October 28, 1996,  by Able Oil Company are being  amortized
                  over a straight-line  period of 15 and 5 years,  respectively.
                  The current period  amortization also includes a customer list
                  of $39,850 and Covenant Not To Compete of $100,000 relating to
                  the acquisition  from B & B Fuels on August 27, 1999, is being
                  amortized  over a  straight-line  period  of 10  and 5  years,
                  respectively.  The  amortization  for the years ended December
                  31, 1999 and 1998 are $82,775 and $88,800, respectively.

                  For income tax basis,  the Customer Lists and the Covenant Not
                  To Compete are being amortized over a straight-line  method of
                  15 years as per the Tax Reform Act of 1993.

                  Use of Estimates

                  The  preparation  of financial  statements in conformity  with
                  generally accepted  accounting  principles requires management
                  to make  estimates  and  assumptions  that  affect the amounts
                  reported in the financial  statements and accompanying  notes.
                  Although these estimates are based on  management's  knowledge
                  of current  events and actions it may undertake in the future,
                  they may ultimately differ from actual results.

                  Income Taxes

                  Effective  January 1, 1997, all the  subsidiaries,  which were
                  S-Corporations,  terminated their S-Corporation elections. The
                  subsidiaries  will be filing a  consolidated  tax return  with
                  Able Energy, Inc. for 1997 and future years.

                  Effective  January 1, 1997, the Company has elected to provide
                  for  income  taxes  based  on  the   provisions  of  Financial
                  Accounting  Standards  Board  ("FASB")  Statement of Financial
                  Accounting  Standards ("SFAS") No. 109, "Accounting for Income
                  Taxes",  which requires recognition of deferred tax assets and
                  liabilities for the expected future tax consequences of events
                  that have been  included in the financial  statements  and tax
                  returns in different years. Under this method, deferred income
                  tax  assets  and  liabilities  are  determined  based  on  the
                  difference  between the  financial  statement and tax bases of
                  assets and  liabilities  using enacted tax rates in effect for
                  the year in which the differences are expected to reverse.

                                      F-11

<PAGE>
                       ABLE ENERGY, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Cont'd)

                           DECEMBER 31, 1999 AND 1998

Note 2         Summary of Significant Accounting Policies (cont'd)

                  Concentrations of Credit Risk

                  The  Company  performs  on-going  credit  evaluations  of  its
                  customers'  financial  conditions  and requires no  collateral
                  from its customers.

                  Financial instruments which potentially subject the Company to
                  concentrations of credit risk consists of checking and savings
                  accounts  with  several  financial  institutions  in excess of
                  insured   limits.   The  excess   above   insured   limits  is
                  approximately  $2,470,000.  The  Company  does not  anticipate
                  non-performance by the financial institutions.

                  Cash

                  For  the  purpose  of the  statement  of cash  flows,  cash is
                  defined as balances  held in corporate  checking  accounts and
                  money market accounts.

Note 3           Public Offering

                  On June 25, 1999, the Company  consummated  its initial public
                  offering.  The  Company  sold 1 million  shares of its  common
                  stock to the public at $7 per share.
<TABLE>
<CAPTION>

<S>                                                                             <C>                 <C>
                           Total                                                                    $7,000,000

                  Less: Underwriting Commission                                 $ 700,000
                  Underwriter's Non-Accountable
                          Expense Allocation                                      210,000
                  Other Expenses of Offering                                      108,000            1,018,000
                                                                                ---------           ----------
                  Net to Company after underwriting Costs                                            5,982,000

                  Other Offering Costs:
                  Legal Fees                                                      154,000
                  Accounting Fees                                                  50,000
                  Printing Costs                                                  100,000
                  Stock Exchange and Other Registration Costs                      17,225             321,225
                                                                                ----------         -----------

                  Net Funds Realized                                                               $5,660,775
                                                                                                   ==========

</TABLE>

                                      F-12
<PAGE>
                       ABLE ENERGY, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Cont'd)

                           DECEMBER 31, 1999 AND 1998

Note 4          Acquisitions

                  On August 27 and 31, 1999,  the Company  through  newly formed
                  wholly owned subsidiaries (see Note l) acquired the following:

                  1) The  assets of B & B Fuels,  a retail  distributor  of home
                  heating oil in  Warrensburg,  New York.  The assets  purchased
                  include an oil  terminal,  three oil  delivery  trucks,  and a
                  customer list of approximately  1,200 customers.  The purchase
                  price was  $295,000.  The Company  also  acquired 9.2 acres of
                  land in Warren  County,  New York. The property is located 1/4
                  miles from the B & B Facility. The cost was $125,000,  paid in
                  cash.

                  2) Property on Route 46, Rockaway, New Jersey. The facility is
                  a large fuel terminal and also houses the Company's  executive
                  offices and other operating  facilities for Able Subsidiaries.
                  There is also a building  rented to an  outside  party with an
                  annual rental of approximately $40,000. The purchase price was
                  $1,150,000.

Note 5          Notes Receivable

                  The Company has  received  payment  from Able Oil  Montgomery,
                  Inc.  for the  year  ended  December  31,  1999  on its  notes
                  receivable  of  $140,000.   The  payments   totaled   $11,761,
                  including  interest  of  $2,482.  Interest  of $8,397 has been
                  recorded as an accrued  receivable.  The  Statement  of Income
                  recognized  income on this  installment sale of $4,849 for the
                  year ended December 31, 1999.

Note 6          Inventories
<TABLE>
<CAPTION>

                            Items                                                               1999
                            -----                                                               ----
<S>                                                                                           <C>
                            Heating Oil                                                       $ 81,737
                            Diesel Fuel                                                         28,969
                            Kerosene                                                             4,709
                            Propane                                                              5,541
                            Parts and Supplies                                                  92,714
                                                                                             ---------
                                 Total                                                        $213,670
                                                                                              ========
</TABLE>



                                      F-13

<PAGE>
                       ABLE ENERGY, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Cont'd)

                           DECEMBER 31, 1999 AND 1998

Note 7         Notes Payable Bank

                  Notes payable to PNC Bank include a line of credit of $500,000
                  with interest at the rate of Prime minus 1/2%. The outstanding
                  balance  on the Line of Credit is  $201,213  at  December  31,
                  1999. The agreement  with Able Oil Company,  dated October 20,
                  1997, and amended  August 11, 1999,  has a current  expiration
                  date of June  30,  2000.  There is also a term  loan  with PNC
                  Bank.  The term loan was refinanced for a total of $675,000 on
                  June  12,  1998.  The  balance  as of  December  31,  1999  is
                  $337,500. The bank has released as collateral the stock of the
                  Company owned by the prior sole  shareholder  and has released
                  the  subsidiaries  and Timothy  Harrington as guarantors.  The
                  Company has  replaced  this by  granting  the PNC Bank a first
                  priority   lien  on   collateral   consisting   of   Provident
                  Institution   Money  Market  Fund   containing  no  less  than
                  $972,000.   The  Company  under  a  guaranty  and   suretyship
                  agreement  will  unconditionally   guarantee  payment  of  the
                  indebtedness  to the bank. All other  collateral and covenants
                  per the agreement have been deleted.

Note 8          Long-Term Debt

                  Mortgage note payable dated,  August 27, 1999,  related to the
                  purchase of B & B Fuels facility and equipment. The total note
                  is  $145,000.  The note is  payable in the  monthly  amount of
                  principal and interest of $1,721.18  with and interest rate of
                  7.5% per annum.  The initial payment was made on September 27,
                  1999, and continues monthly until August 27, 2009 which is the
                  final payment.  The note is secured by a mortgage made by Able
                  Energy New York, Inc. on property at 2 and 4 Green Terrace and
                  4 Horican  Avenue,  Town of  Warrensburg,  Warren County,  New
                  York.  The balance  due on this Note at December  31, 1999 was
                  $141,710.

                  Mortgage note payable dated,  August 31, 1999,  related to the
                  purchase of the facility and equipment in Rockaway, New Jersey
                  by Able Energy Terminal, LLC ("Terminal").  The note is in the
                  amount of $650,000.

                  Pursuant  to  Section  4.4  of  the  Agreement  of  Sale,  the
                  Principal  Sum shall be reduced by an amount equal to one-half
                  of all sums  expended  by Borrower  on the  investigation  and
                  remediation of the property provided, however, that the amount
                  of said reduction shall not exceed $250,000 (the  "Remediation
                  Amount").

                                      F-14

<PAGE>
                       ABLE ENERGY, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Cont'd)

                           DECEMBER 31, 1999 AND 1998

Note 8         Long-Term Debt (cont'd)

                  The "Principal Sum: Less the "Remediation  Amount" shall be an
                  amount equal to $400,000 (the "Reduced  Principal  Sum").  The
                  Reduced Principal Sum shall bear interest from the date hereof
                  at the rate of 8.25% per annum. Any portion of the Remediation
                  Amount not utilized in the  investigation  and  remediation of
                  the  property  shall not begin to accrue  interest  until such
                  time that (i) a "No Further  Action  Letter" is obtained  from
                  the  Department  of  Environmental   Protection  and  (ii)  an
                  outstanding   lawsuit  concerning  the  property  is  resolved
                  through  settlement  or  litigation  (subject  to  no  further
                  appeals).  All payments on this Note shall be applied first to
                  the  payment of  interest,  with any balance to the payment to
                  reduction of the reduced Principal Sum.

                  The  Reduced  Principal  Sum  and  interest  shall  be due and
                  payable   monthly   commencing  on  September  30,  1999,  and
                  continuing on the last day of each month  thereafter up to and
                  including July 31, 2004.

                  The  Note is  collateralized  by the  property  and  equipment
                  purchased  and  assignment  of the leases.  The balance due on
                  this Note at December 31, 1999 was $628,142.

                  Notes  Payable to Orix  Credit  Alliance,  Inc.  at a range of
                  interest  rates from 9.00% to 11.25%  with an average  monthly
                  payment  of $9,695  (1999).  The  earliest  of  theses  Notes;
                  originated  on  October  1, 1993 and the last Note  matures on
                  August 24, 2001. The Notes are  collateralized by various fuel
                  oil trucks.
<TABLE>
<CAPTION>

                                                                                   1999

<S>                                                                             <C>
                           Notes Balance                                        $162,861

                  Two Notes Payable to Chrysler Financial at a range of interest
                    from  of  8.9% to  9.15%  with  total  monthly  payments  of
                    $830.57. The earliest of these Notes

                  originated  on March  25,  1999 and the last Note  matures  in
                  March  2004.  These Notes are  collateralized  by a 1999 and a
                  1998 Dodge truck.

                           Notes Balance                                        $  34,788
</TABLE>



                                      F-15
<PAGE>
                       ABLE ENERGY, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Cont'd)

                                DECEMBER 31, 1999

Note 8          Long Term Debt (Cont'd)

                  Note Payable to World Omni at an interest  rate of 8.869% with
                  a monthly payment of $234.99. The Note originated November 21,
                  1997 and matures  December  21,  2000 with a final  payment of
                  $13,780.  The Note is  collateralized  by a Ford F-150 Pick-up
                  Truck.

                                                                        1999

                           Note Balance                               $ 15,182

                  Note  Payable to Orix  Leasing  Corp.  At an interest  rate of
                  9.111% with a monthly  payment of $4,846.  The Note originated
                  on March 19, 1997 and matures on March 19,  2001.  The Note is
                  collateralized by 254 propane cylinders and 2 propane delivery
                  trucks.

                           Note Balance                               $ 54,565

                  Note Payable to Summit  Leasing  Corp.  At an interest rate of
                  8.50% with a monthly payment of $1,124.52. The Note originated
                  on November  10, 1997 and matures on November  10,  2001.  The
                  Notes  are  collateralized  by a 1998  Freightliner  fuel  oil
                  truck.

                           Note Balance                               $ 23,789

                  Note Payable to PNC Bank with a monthly payment of $1,250 plus
                  interest at 1%, plus Prime. The Note originated on November 6,
                  1997 and matures  October 30, 2000.  Proceeds of the Note were
                  used to buy two oil  trucks,  a  customer  list  and to fund a
                  non-compete payout to the seller of these assets.

                           Note Balance                               $ 12,500










                                      F-16
<PAGE>
                       ABLE ENERGY, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Cont'd)

                           DECEMBER 31, 1999 AND 1998

Note 8          Long Term Debt (Cont'd)

                  The  Company  and  Able  Propane,  LLC  have a  lease/purchase
                  agreement  with First Sierra  Financial,  Inc.  The  agreement
                  calls  for 48  payments  of  $1,457.50,  including  principal,
                  interest and sales tax and a final purchase  option payment of
                  $5,576.02 plus sales tax. The interest rate is approximately 8
                  1/2%.  The  agreement  is   collateralized  by  the  equipment
                  purchase.

                                                                         1999

                                    Balance Due                       $ 44,134

                  Able Oil Company and Able Propane,  LLC have a  lease/purchase
                  agreement  with  Summit  Leasing   Corporation,   Lease  #002,
                  collateralized  by a 1998  Peterbilt  Model  375  truck  and a
                  Trinity trailer.  The lease and payments began August 20, 1998
                  at $1,605.50  per month for 48 payments  thereafter  until all
                  payments are made through and including July 20, 2002.

                                    Balance Due                       $ 47,028

                  Able  Oil  Company  and  Able  Propane  have a  lease/purchase
                  agreement  with  Summit  Leasing   Corporation,   Lease  #003,
                  collateralized  by a Freightliner  truck.  The lease commenced
                  November  10, 1998 and has 48 monthly  payments  of  $1,286.12
                  until  November 2002 with a final  purchase  option payment of
                  $12,682.

                                    Balance Due                       $ 51,024

                  Notes  Payable to Greentree  Consumer  Discount  Company at an
                  interest  rate of 8.95%  with an  average  monthly  payment of
                  $1,322.37.  The  Notes  originated  on  October  1,  1996  and
                  December  10, 1996 and matures on October 1, and  December 10,
                  2000. The Notes are  collateralized  by two 1997  Freightliner
                  Oil Trucks.

                           Note Balance                               $ 31,287





                                      F-17
<PAGE>
                       ABLE ENERGY, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Cont'd)

                           DECEMBER 31, 1999 AND 1998

Note 8          Long Term Debt (Cont'd)

                  Term  Loan  payable  to PNC Bank.  The  current  payments  are
                  $18,750  per month with  interest  at a rate of prime plus 1%.
                  The note matures in 36 months, June 2001.

                           Note Balance                               $337,500

                  Notes  payable to AEL Leasing Co.,  Inc.  under a master lease
                  agreement dated March 3, 1997.  During 1997 Able Propane,  LLC
                  was advanced  $133,456,  with no principal  payments.  AEL had
                  extended Able Propane a line of credit of $150,000 in 1997. In
                  June 1998 the loan was  finalized at $178,920  with 36 monthly
                  payments of $4,970,  including principal and interest, with an
                  interest  rate of  8.25%.  The note is  collateralized  by the
                  tanks and equipment purchased. The note matures in June 2001.

                           Note Balance                               $ 72,986

                  Able Oil Company and able Propane,  LLC have a  lease/purchase
                  agreement  with  Summit  Leasing   Corporation,   Lease  #004,
                  collateralized  by a Ford F-450 truck and a 1997 Chevy 3/4 ton
                  van. The lease and payments began January 1, 1999 at $1,591.87
                  per month for 48 payments  thereafter  until all  payments are
                  made through and including December 2002. Interest at 6.92%

                           Note Balance                              $ 63,153

                  Note Payable Commonwealth Finance Inc. at an interest rate of
                  7.90%, 36 payments of $447.33   The first payment began
                  February 1999 and matures January 2002.  The Note is
                  collateralized by propane tanks.

                           Note Balance                              $ 10,279









                                      F-18

<PAGE>
                       ABLE ENERGY, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Cont'd)

                              DECEMBER 31, 1999 AND

Note 8          Long Term Debt (Cont'd)

                  Able Oil Company has a  lease/purchase  agreement  with Summit
                  Leasing  Corporation,  Lease  #005,  collateralized  by a 1999
                  Freightliner  FL-70,  2800  gallon Tri State  Truck tank and a
                  1999 Kenworth Model T-300  conventional  cab and chassis.  The
                  lease  payments  began  January 5, 1999 at $2,810.62 per month
                  for 48 months and 5  additional  days until all  payments  are
                  made through January 10, 2003. Able Oil Company has the option
                  to purchase all the equipment for an amount agreed upon as the
                  fair market value at the end of the lease term.

                                                                         1999

                           Note Balance                              $ 111,849

                  Two Notes  payable to Ford Credit at  interest  rates of 3.90%
                  and  8.79%,  with  monthly  payments  of $602.32  and  $737.34
                  including  interest.  The Notes originated in January 1999 and
                  include 48 monthly  payments  and mature  December  2002.  The
                  Notes are collateralized by two 1998 Ford Econo-Line trucks.

                           Note Balance                              $  43,748

                  The  Company  and  Able  Propane,  LLC  have a  lease/purchase
                  agreement  with First Sierra  Financial,  Inc.  The  agreement
                  calls  for  48  payments  of  $559,  including  principal  and
                  interest and sales tax and a final purchase  option payment of
                  $2,191.10,  plus sales tax. The lease began  February 1999 and
                  ends January 2003. The interest rate is  approximately 8 1/2%.
                  The agreement is collateralized by the equipment purchase.

                           Note balance                              $  16,237

                  Two Notes  payable to Ford Credit at  interest  rates of 8.60%
                  and  6.02%  with  monthly  payments  of  $629.46  and  $695.83
                  including  interest.   The  Notes  originated  June  1999  and
                  December  1999,  they each  include  48 monthly  payments  and
                  mature May 2003 and November 2003, respectively. The Notes are
                  collateralized by two 1999 Ford Vans.

                           Note balance                              $  52,282

                                      F-19
<PAGE>
                       ABLE ENERGY, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Cont'd)

                           DECEMBER 31, 1999 AND 1998

Note 8          Long Term Debt (Cont'd)

                  Able Oil Company has a  lease/purchase  agreement with Summity
                  Leasing Corporation,  lease #007,  collateralized by equipment
                  as stated in the agreement.  The lease payments began December
                  25, 1999 at $9,023.46 per month for 48 months and 5 additional
                  days until all payments  are made  through  November 25, 2003.
                  The interest is an average of 4.5% per annum. Able Oil Company
                  has the option to  purchase  all the  equipment  for an amount
                  agreed upon as the fair  market  value at the end of the lease
                  term.

                           Note balance                              $ 364,378

                  Maturities on the Notes Payable subsequent to December 31,
1999 are as follows:

                For the Year            Ending Principal
                December 31,                Amount
                ------------                ------
                   2000                 $  789,977
                   2001                    519,676
                   2002                    347,966
                   2003                    251,348
                   2004                    329,341
                Balance                     81,114
                                        ----------
                Total                   $2,319,422
                                        ==========

Note 9         Covenant Not To Compete

                  On October 28, 1996, a Covenant Not To Compete was  originated
                  by the Able  Oil  Company,  Connell's  Fuel  Oil  Company  and
                  William  Toriello.  The  Covenant  is to last 5 years from the
                  date of  inception  with a monthly  installment  of  $3,059.44
                  starting  December  1,  1996.  The  balance  was  paid in full
                  September 7, 1999. The covenant is in effect until October 29,
                  2001.

                                      F-20
<PAGE>
                       ABLE ENERGY, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Cont'd)

                           DECEMBER 31, 1999 and 1998

Note 10         Income Taxes

                  Effective January 1, 1997 the Company adopted Statement of
                  Financial Accounting Standards No. 109, Accounting for Income
                  Taxes.

                  The differences  between the statutory  Federal Income Tax and
                  Income Taxes is accounted for as follows:
<TABLE>
<CAPTION>

                                                                 1999                                     1998
                                                                 ----                                     ----
                                                                          Percent of                                Percent
                                                                          Pretax                                    of
                                                         Amount           Income                 Amount             Pretax
                                                         ------           ------                 ------             Income
                                                                                                                    ------
<S>                                                    <C>                <C>                   <C>                  <C>
Statutory Federal Income Tax (Benefits)                $(32,600)          (15.0%)               $ 4,430              15.0%

Increase resulting from State Income

Tax, net of Federal Tax benefit                          (4,268)           (6.5%)                 2,210              7.6%
                                                        --------           ------               -------              ----
                                                                                                $ 6,640

Income Taxes                                           $(36,868)          (21.5%)                                    22.6%
                                                       ========            ======                                    ====

Income Taxes consist of:                                                                          6,020
 Current                                                (18,658)                                    620
                                                        --------
 Deferred                                               (18,210)                                $ 6,640
                                                         -------                                =======
    Total                                              $(36,868)
                                                        ========
</TABLE>

                  The types of  temporary  differences  between the tax bases of
                  assets and liabilities and their financial  reporting  amounts
                  that give rise to a  significant  portion of the  deferred tax
                  liability  and  deferred tax asset and their  approximate  tax
                  effects are as follows at:
<TABLE>
<CAPTION>

                                                                              1999

                                                              Temporary                 Tax
                                                             Difference               Effect

<S>                                                           <C>                    <C>
Depreciation                                                  $(179,389)             $(56,201)
Allowance for Doubtful Accounts                                 157,974                44,235
Gain on Sale of Subsidiary                                       18,766                 4,035
</TABLE>



                                      F-21
<PAGE>
                       ABLE ENERGY, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Cont'd)

                           DECEMBER 31, 1999 and 1998

Note 11        Profit Sharing Plan

                  Effective  January 1, 1997,  Able Oil  Company  established  a
                  Qualified  Profit  Sharing  Plan under  Internal  Revenue Code
                  Section 401-K.  The Company matches 25% of qualified  employee
                  contributions.  The  expense  was  $10,120  (1999) and $10,384
                  (1998).

Note 12         Commitments and Contingencies

                  The Company is subject to laws and regulations relating to the
                  protection  of the  environment.  While it is not  possible to
                  quantify  with  certainty  the  potential  impact  of  actions
                  regarding environmental matters, in the opinion of management,
                  compliance with the present environmental protection laws will
                  not have a material adverse effect on the financial condition,
                  competitive position, or capital expenditures of the Company.

                  Able Oil Company has contracted with Unocal to take deliveries
                  of 24,000  barrels  of #2 oil.  The oil will be stored in Able
                  storage   tanks  and  remain  the  property  of  Unocal  until
                  purchased by Able Oil. Able Oil is under  contract to purchase
                  the product in the months of November  and  December  1999 and
                  January and February  2000. The pricing will be the NYMEX less
                  $.01 per barrel on 12,000 barrels and flat on 12,000  barrels.
                  At  December  31,  1999,  Able Oil had in their  tanks  12,000
                  barrels or 504,000  gallons of oil  belonging  to Unocal.  The
                  total  exposure  for the cost of this  oil  priced  at  future
                  January, and February 2000 is $481,169. This oil was purchased
                  at this price on January 24, 2000.

                  In  accordance  with  the  agreement  on the  purchase  of the
                  property  on Route 46,  Rockaway,  New  Jersey by Able  Energy
                  Terminal, LLC, the purchaser shall commence after the closing,
                  the  investigation  and  remediation  of the  property and any
                  hazardous  substances  emanating from the property in order to
                  obtain  a  No  Further  Action  letter  from  the  New  Jersey
                  Department of Environmental  Protection (NJDEP). The purchaser
                  will also pursue  recovery  of all costs and  damages  related
                  thereto in the lawsuit by the seller  against a former  tenant
                  on  the  purchased   property.   Purchaser   will  assume  all
                  responsibility  and direction for the lawsuit,  subject to the
                  sharing of any  recoveries  from the lawsuit  with the seller,
                  50-50.  The seller by reduction of its mortgage will pay costs
                  related  to the  above up to  $250,000  (see  Note 8).  In the
                  opinion of  management,  the Company will not sustain costs in
                  this matter which will have a material  adverse  effect on its
                  financial condition.

                                      F-22

<PAGE>
                       ABLE ENERGY, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Cont'd)

                           DECEMBER 31, 1999 AND 1998

Note 12         Commitments and Contingencies (Cont'd)

                  Able Oil Company has been  examined  by the  Internal  Revenue
                  Service  through the year ended  December 31,  1995.  The only
                  open year for Able Oil Company is  December  31, 1996 and Able
                  Energy,  Inc.,  et al,  open years are  December  31, 1997 and
                  December 31, 1998.

Note 13         Operating Lease

                  Able Energy Terminal, LLC, has acquired the following lease on
                  the property it purchased on Route 46 in Rockaway, New Jersey.

                  The lease with Able Oil Company,  a wholly owned subsidiary of
                  Able Energy,  Inc.,  has an expiration  date of July 31, 2004.
                  The lease provides for a monthly  payment of $1,200 plus a one
                  cent per  gallon  through  put,  as per a monthly  rack  meter
                  reading.

                  Estimated future rents are $14,400 per year, plus the one cent
                  per gallon  through put  charges  per the  monthly  rack meter
                  readings.

                  The  Company  leased  an  additional  facility  on Route 46 in
                  Rockaway,  New  Jersey.  The lease has a term of one year from
                  September 1, 1999 to August 31,  2000.  The rent is $1,300 per
                  month,  $15,600 for the year, plus 10% of the increase in real
                  estate  taxes over the base year,  1999.  The  Company has the
                  option  to  renew  for five  additional  one-year  terms.  The
                  renewals  are at an  increase  of $100 per month  during  each
                  renewal term. The estimated  Future rent upon one year renewal
                  is $16,800. The rent expense for the period is $5,200.

                  The following  summarizes the month to month operating  leases
                  for the other subsidiaries:

                  Able Oil Melbourne             $238.50, per month
                                                 Total 1999 rent expense, $2,862


Note 14         Related Party Transactions

                  $44,690  is due  from  the  major  Shareholder/Officer  of the
                  Company.  This amount is evidenced by a Note bearing  interest
                  at a rate of 8 1/2% between the Shareholder and the Company.

                                      F-23

<PAGE>
                       ABLE ENERGY, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Cont'd)

                                DECEMBER 31, 1999

Note 15        Income Taxes payable - Prior

                  Able Oil  Company's  tax  returns  have been  examined  by the
                  Internal  Revenue  Service for the years  ending  December 31,
                  1992,  1993,  1994 and 1995. The Company has been assessed the
                  following liabilities including interest and penalties:
<TABLE>
<CAPTION>

                          <S>                                         <C>
                          1992 and 1993                               $52,005
                           Paid                                        (5,000)
                          1994 and 1995                                 6,805
                                                                      --------
                            Total Due                                 $53,810
                          Payments Made and Adjustments               (53,810)
                                                                      --------
                             Due December 31, 1999                    $     0
                                                                      ========
</TABLE>

                  The State of New Jersey,  Division of Taxation  has billed the
                  Company  based upon  information  received  from the  Internal
                  Revenue  Service  for the years  1992 and 1993,  approximately
                  $20,150.  The above  amounts are included on the balance sheet
                  in Income Taxes Payable - Prior.

                                        Total Due December 31, 1999          $ 0

                  The above  assessed  income taxes  resulted for years prior to
                  the  formation  of Able  Energy,  Inc. and has been charged to
                  Able Oil Company's prior retained earnings.

Note 16        Sale of Subsidiaries

                  The Company sold two of their wholly owned  subsidiaries,  one
                  on  December  29,  1998  and one on  December  31,  1998.  The
                  Statement  of  Income   reflects  the   operations   of  these
                  subsidiaries  for the Calendar year 1998.  These  subsidiaries
                  have been eliminated from the Balance Sheet as of December 31,
                  1998.

                  One subsidiary, Able Oil Company Montgomery, Inc. was sold for
                  $140,000.  The  note  receivable  is  payable  in  60  monthly
                  payments  of  $2,940.26,  including  principal  and  interest.
                  Interest is at 9.5%, per annum.  The first payment was January
                  1,  1999  and the  final  payment  is  December  1,  2003.  As
                  collateral  to secure  payment to the  Company,  the buyer has
                  pledged  the stock and all of the  assets of Able Oil  Company
                  Montgomery, Inc. A UCC-1 financing statement has been filed in
                  respect to the collateral.

                                        Note Receivable ..   $140,000
                                        Current Portion ..     28,000
                                                             --------
                                        Due After One Year   $112,000
                                                             ========

                  The gain of  $72,739  from  the  sale is shown on the  balance
                  sheet as deferred income.  The income will be recognized on an
                  installment basis upon collection of the notes receivable.

                                      F-24
<PAGE>
                       ABLE ENERGY, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Cont'd)

                           DECEMBER 31, 1999 AND 1998

Note 16        Sale of Subsidiaries (cont'd)

                  The Company has a ten year franchise agreement with the buyer.
                  The buyer  will use the Able  name,  Able Oil  Company  is the
                  exclusive  supplier of #2 fuel oil through its credit facility
                  with  major   suppliers   and  also  assists  the  buyer  with
                  advertising and other marketing.  The Company has a mark-up on
                  the sale of the  product  and  receives  a 1%  royalty  fee on
                  monthly gross sales.

                  The  Company  sold  all  its  shares  in  A & O  Environmental
                  Services, Inc. on December 31, 1998 to Owl Environmental, Inc.
                  for a selling price of $10. The buyer by purchasing  the stock
                  of the subsidiary  assumed all its assets and liabilities.  An
                  amount of $54,404  in the  Statement  of Income  and  Retained
                  Earnings was recorded as the excess of subsidiary  losses over
                  investment.

                  All advances to the two  subsidiaries by Able Oil Company were
                  transferred to Able Energy, Inc. and recorded as investment in
                  subsidiaries  and these  costs were  written  off  against the
                  subsidiary sales.

                  Summary  of  Assets  and  Liabilities  and  Gain  on  Sale  of
                  Subsidiaries sold.
<TABLE>
<CAPTION>

                                                                          A & O Environmental           Able Oil
                                                                             Services, Inc.           Montgomery, Inc.

<S>                                                                       <C>                         <C>
Current Assets                                                            $  214,233                  $   29,190
Equipment - Net                                                               35,386                      17,166
Intangible Assets - Net                                                       -                           27,340
                                                                           ---------                  ----------
     Total Assets                                                            249,619                      73,696
                                                                           ---------                  ----------

Current Liabilities                                                          523,953                     114,968
Long Term Debt (Less Current Portion)                                          8,038                      13,750
                                                                           ---------                  ----------
      Total Liabilities                                                      531,991                     128,718
                                                                           ---------                  ----------

Liabilities in Excess of Assets                                           $(282,372)                  $ (55,022)
                                                                          ==========                  ==========

Sale Price                                                                $      10                   $ 140,000
                                                                          ----------                  ----------
Cash Investment                                                            (128,945)                   (115,385)
Negative Investment in
   Subsidiaries - Prior Loss                                                 183,339                      48,124
                                                                          ----------                  ----------
Excess of Subsidiary Cumulative Losses

   Over Investment                                                            54,394                    (67,261)
                                                                          ----------                  ---------

       Total Gain                                                         $   54,404                  $   72,739
                                                                          ==========                  ==========
</TABLE>

                                      F-25
<PAGE>
                       ABLE ENERGY, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Cont'd)

                           DECEMBER 31, 1999 AND 1998

Note 17          Proform Statement of Income
<TABLE>
<CAPTION>

                  The following  shows the effect on the Statement of Income for
                  the year  ended  December  31,  1998 with the  removal  of the
                  subsidiaries sold:

<S>                                                                                                     <C>
                  Net Income per Statement of Income and Retained Earnings                              $40,693
                  Add: Losses on Subsidiaries sold, Net of Tax Savings
                       A & O Environmental Services, Inc.                                                97,123
                       Able Oil Montgomery, Inc.                                                         11,434
                  Less: Excess of Subsidiary Losses over Investment

                    Recorded as Income                                                                  (54,404)
                                                                                                        --------
                  Net Income - Removing effect of Subsidiaries Sold                                     $94,846
                                                                                                        ========
</TABLE>

Note 18         Extraordinary Item

                  The   extraordinary   item  is  the  income  realized  on  the
                  extinguishment of debt for less than its carrying amount.  The
                  amount shown is net of income taxes of $9,710. On September 7,
                  1999, the Company paid two loans to Connell's Fuel Oil Company
                  and William  Toriello which had original due dates of November
                  1, 2001.
<TABLE>
<CAPTION>

<S>                                                                                              <C>
                           Total Amount Due                                                      $312,454
                           Amount Paid                                                            247,725
                                                                                                 --------
                           Income on Extinguishment of Debt                                        64,729
                              Less Income Taxes                                                     9,710
                                                                                                ---------
                           Extraordinary Item                                                    $ 55,019
                                                                                                 ========
</TABLE>

Note 19            Common Stock Split

                  In conjunction with the Company's initial public offering, its
                  common stock was split 1000-for-l.
<TABLE>
<CAPTION>

                                                                       Original              After Split and
                                                                                            Public Offering

<S>                                                                       <C>                  <C>
                Authorized Shares                                         10,000               10,000,000
                                                                       ---------               ----------
                Issued and Outstanding Shares                              1,000                1,000,000
                Public Offering Shares                                         0                1,000,000
                                                                                               ----------

                Total Issued and Outstanding Shares                                             2,000,000
                                                                                               ==========

                Par Value $.001 per Share                                     $1             $      2,000
                                                                                             ============
</TABLE>

                                      F-26
<PAGE>
                       ABLE ENERGY, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Cont'd)

                           DECEMBER 31, 1999 AND 1998

Note 19         Per share Information

                  Per share  information has been computed based on the weighted
                  average  number  of  shares.  The  shares  give  effect  to  a
                  1,000-for-1 stock split by the Company and its public offering
                  of 1,000,000 shares.

                                      F-27
<PAGE>
                                   SIGNATURES

         In  accordance  with  Section  13 or 15(d)  of the  Exchange  Act,  the
registrant  caused  this  report to be signed on its behalf by the  undersigned,
thereunto duly authorized, on this 30th day of March, 2000.

                           ABLE ENERGY, INC.



                       /s/ Timothy Harrington
                           Timothy Harrington, Chief Executive Officer

                       /s/ Christopher P. Westad
                           Christopher P. Westad, President

                       /s/ James Purcaro
                           James Purcaro, Director

                       /s/ Gregory Sichenzia
                           Gregory Sichenzia, Director

                       /s/ Patrick O'Neill
                           Patrick O'Neill, Director