U. S. SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549
                                   FORM 10-QSB

         [X]  Quarterly  report  under  Section  13 or 15(d)  of the  Securities
Exchange Act of 1934

         For the quarterly period ended March 31, 1999

         [   ]  Transition report under Section 13 or 15(d) of the Exchange Act

         For the transition period from __________ to __________

                         Commission File Number 0-21279

                          THERMACELL TECHNOLOGIES, INC.
                          ----------------------------
        (Exact Name of Small Business Issuer as Specified in Its Charter)

          FLORIDA                                                59-3223708
     -----------------                                      --------------------
(State or Other Jurisdiction of                               (I.R.S. Employer
 Incorporation or Organization)                              Identification No.)

                     1125 Commerce Blvd., Sarasota, FL 34243
                     ---------------------------------------
                    (Address of Principal Executive Offices)

                                 (941) 358-0306
                                 --------------
                           (Issuer's Telephone Number)


         Check whether the issuer: (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such a
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      No  X
    ---     ---
     The number of shares  outstanding of the Issuer's Common Stock,  $.0001 Par
Value, as of March 31, 1999 was 7,294,325.

         Transitional Small Business Disclosure Format:

Yes      No X
   ---     ---

<PAGE>


                 THERMACELL TECHNOLOGIES, INC. AND SUBSIDIARIES


                                      Index



                                                                         Page
Part I - Financial Information                                           ----

Item 1.  Consolidated Financial Statements

         Consolidated Balance Sheets -
           March 31, 1999 and September 30, 1998.....................   1 - 2

         Consolidated Statements of Operations -
           Three months and Six months ended March 31, 1999 and 1998.     3

         Consolidated Statements of Cash Flows -
           Six months ended March 31, 1999 and 1998..................     4

         Notes to Consolidated Financial Statements..................     5

Item 2.  Management's Discussion and Analysis of Financial
           Condition and Results of Operations.......................   6 - 9

Part II - Other Information

Item 1. Legal Proceedings............................................    10

         Signatures..................................................    11

Exhibit 11...........................................................    12


                                       i
<PAGE>

                                 THERMACELL TECHNOLOGIES, INC. AND SUBSIDIARIES

                                           Consolidated Balance Sheets


                                                      Assets

<TABLE>
<CAPTION>



                                                                                     March 31,         September 30,
                                                                                       1999                1998
                                                                                 ------------------  ------------------


<S>                                                                           <C>                   <C>    
Current assets
   Cash                                                                           $        391,897    $         67,405
   Accounts receivable
     Trade, net of allowance for uncollectible accounts
     of $41,292 and $64,591, respectively                                                  897,086             314,262
   Notes receivable - trade                                                                 52,000              52,000
   Notes receivable - other                                                                 76,622              76,622
   Other current assets                                                                     12,220              18,998
   Inventories                                                                             785,696             489,259
   Prepaid interest                                                                        166,667                   -
   Prepaid expenses and other                                                              518,659             161,308
                                                                                 ------------------  ------------------

         Total current assets                                                            2,900,847           1,179,854
                                                                                 ------------------  ------------------

Property and equipment                                                                   1,651,996           1,141,502
   Less - accumulated depreciation                                                         331,422             248,530
                                                                                 ------------------  ------------------
                                                                                         1,320,574             892,972
                                                                                 ------------------  ------------------

Other assets
   Deposits                                                                                  9,906              16,266
   Deferred income tax benefit, net                                                        912,317             795,309
   Goodwill, net of accumulated amortization
     of $105,435 and $95,602, respectively                                               1,535,607             815,010
   Other intangibles, net of accumulated amortization
     of $35,621 and $33,173, respectively                                                  196,323             162,469
                                                                                 ------------------  ------------------
                                                                                         2,654,153           1,789,054
                                                                                 ------------------  ------------------




         Total assets                                                             $      6,875,574    $      3,861,880
                                                                                 ==================  ==================


</TABLE>

See notes to consolidated financial statements.

 
                                        1
<PAGE>



                                 THERMACELL TECHNOLOGIES, INC. AND SUBSIDIARIES

                                          Consolidated Balance Sheets


                                      Liabilities and Stockholders' Equity

<TABLE>
<CAPTION>


                                                                                     March 31,         September 30,
                                                                                       1999                1998
                                                                                 ------------------  ------------------


<S>                                                                            <C>                  <C>  
Current liabilities
   Accounts payable                                                               $      1,130,160    $        445,118
   Accrued expenses                                                                        262,171              45,396
   Accrued payroll and payroll taxes                                                        12,332              13,647
   Current maturities of long-term debt
     Notes payable                                                                          36,854              20,340
     Capital leases                                                                         35,954              38,644
                                                                                 ------------------  ------------------

         Total current liabilities                                                       1,477,471             563,145
                                                                                 ------------------  ------------------

Long-term debt, net of current maturities
   Notes payable                                                                            80,986              58,128
   Capital lease obligations                                                               132,623              73,079
   Convertible note payable                                                                666,667                   -
                                                                                 ------------------  ------------------
         Total long-term debt, net of current maturities                                   880,276             131,207
                                                                                 ------------------  ------------------

         Total Liabilities                                                               2,357,747             694,352
                                                                                 ------------------  ------------------

Commitments and contingencies                                                                    -                   -

Stockholders' equity
   Preferred stock, Series A, par value $.0001
     5,000,000 shares, authorized, issued
     and outstanding                                                                           500                 500

   Preferred  stock,  Series B  convertible,  $1,000 stated  value,  8% dividend
     Authorized 1,500 shares,
     0 and 250 issued and outstanding, respectively                                              -             250,000

   Common stock, par value $.0001
     Authorized 20,000,000 shares,
     7,294,325 and 5,129,325 issued and outstanding, respectively                              729                 513

   Additional paid-in capital                                                            8,825,153           6,612,481
   Deduct notes receivable associated with stockholder loan                               (584,811)           (453,695)
   Accumulated deficit                                                                  (3,723,744)         (3,242,271)
                                                                                 ------------------  ------------------

         Total stockholders' equity                                                      4,517,827           3,167,528
                                                                                 ------------------  ------------------


         Total liabilities and stockholders' equity                               $      6,875,574    $      3,861,880
                                                                                 ==================  ==================


</TABLE>

See notes to consolidated financial statements.


                                       2
<PAGE>

                                  THERMACELL TECHNOLOGIES, INC. AND SUBSIDIARIES

                                       Consolidated Statements of Operations
                                                    (Unaudited)

<TABLE>
<CAPTION>

                                                           For the Three Months Ended              For the Six Months Ended
                                                         --------------------------------       -------------------------------
                                                           March 31,          March 31,          March 31,          March 31,
                                                             1999               1998                1999               1998
                                                         --------------      ------------       -------------       -----------

<S>                                                    <C>                <C>                <C>                 <C> 
Revenue
     Sales                                              $    1,128,941     $     712,347      $    1,940,351      $  1,470,631

Less cost of sales                                             778,702           474,147           1,351,845           966,856
                                                         --------------      ------------       -------------       -----------

     Gross profit                                              350,239           238,200             588,506           503,775

Selling, general and administrative
     expenses                                                  667,854           408,424           1,185,314           748,069
                                                         --------------      ------------       -------------       -----------

                Loss from operations                          (317,615)         (170,224)           (596,808)         (244,294)
                                                         --------------      ------------       -------------       -----------

Other income (expense)
     Interest income                                                 -            13,080               4,431            25,066
     Interest expense                                           (6,629)           (2,215)             (9,464)           (6,894)
     Other                                                           -            45,045                   -            46,740
                                                         --------------      ------------       -------------       -----------

                Total other income (expense)                    (6,629)           55,910              (5,033)           64,912
                                                         --------------      ------------       -------------       -----------

                Loss before income taxes                      (324,244)         (114,314)           (601,841)         (179,382)

Income taxes
     Deferred income tax benefit                                64,848            22,863             120,367            35,877
                                                         --------------      ------------       -------------       -----------

                Net loss                                $     (259,396)    $     (91,451)     $     (481,474)     $   (143,505) 
                                                         ==============      ============       =============       ===========


Basic loss per common share                             $        (0.03)    $       (0.03)     $        (0.06)     $      (0.05) 
                                                         ==============      ============       =============       ===========

Weighted average number of
     common shares outstanding                               8,452,420         3,620,235           7,593,643         3,378,748
                                                         ==============      ============       =============       ===========

</TABLE>


See notes to consolidated financial statements.


                                       3
<PAGE>

                                THERMACELL TECHNOLOGIES, INC. AND SUBSIDIARIES

                                     Consolidated Statements of Cash Flows
                                                  (Unaudited)
<TABLE>
<CAPTION>

                                                                                  For the Six Months Ended
                                                                              ----------------------------------
                                                                                March 31,          March 31,
                                                                                   1999               1998
                                                                              ---------------    ---------------

<S>                                                                         <C>                <C>
Cash flows from operating activities:
   Reconciliation of net loss to net cash
     used in operating activities
       Net loss                                                              $      (481,474)   $      (160,157)
       Adjustments to reconcile net loss to net
         cash used in operating activities
         Depreciation                                                                 82,892             62,958
         Amortization                                                                 12,281             40,746
         Deferred income tax benefit                                                (120,367)           (35,877)
       Changes in assets and liabilities, net of acquisitions
         (Increase) decrease in accounts and notes receivable                       (104,256)            21,395
         (Increase) in inventories                                                   (11,497)          (109,438)
         (Increase) in prepaid and other assets                                     (321,436)          (254,457)
         Increase (decrease) in accounts payable                                     111,625           (100,618)
         Increase (decrease) in accrued expenses                                    (194,487)          (294,050)
         Common stock issued for services                                            300,000                  -
                                                                              ---------------    ---------------
               Net cash used in operating activities                                (726,719)          (829,498)
                                                                              ---------------    ---------------

Cash flows from investing activities
   Capital expenditures                                                              (70,495)          (154,669)
   Acquisitions                                                                   (1,475,006)           (66,340)
   Expenditures for patent, net                                                      (41,200)           (30,000)
                                                                              ---------------    ---------------
               Net cash used in investing activities                              (1,586,701)          (251,009)
                                                                              ---------------    ---------------

Cash flows from financing activities
   Proceeds from issuance of common stock                                          2,212,888             81,526
   Proceeds from issuance of Series B preferred stock                                      -          1,500,000
   Proceeds from issuance of notes payable                                            56,140                  -
   Proceeds from issuance of convertible note                                        500,000                  -
   Principal payments on notes payable                                                     -             (8,807)
   Principal advances on stockholder loan                                           (131,116)                 -
   Proceeds from payments on stockholder loan                                              -            107,831
   Costs associated with obtaining financing                                               -           (300,000)
                                                                              ---------------    ---------------
               Net cash provided by financing activities                           2,637,912          1,380,550
                                                                              ---------------    ---------------

               Net increase in cash                                                  324,492            300,043

Cash beginning                                                                        67,405            580,522
                                                                              ---------------    ---------------

Cash ending                                                                  $       391,897    $       880,565
                                                                              ===============    ===============


</TABLE>


See notes to consolidated financial statements.

                                       4
<PAGE>


                 THERMACELL TECHNOLOGIES, INC. AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                                   (Unaudited)

Note 1 - Basis of presentation

The accompanying  unaudited  consolidated  financial  statements,  which are for
interim  periods,  do  not  include  all  disclosures  provided  in  the  annual
consolidated  financial statements.  These unaudited financial statements should
be read in conjunction with the financial  statements and the footnotes  thereto
contained  in Form  10-KSB for the fiscal  period  ended  September  30, 1998 of
ThermaCell Technologies,  Inc. (the "Company"), as filed with the Securities and
Exchange Commission.

In the opinion of management,  the accompanying  unaudited financial  statements
contain all adjustments  (which are of a normal and recurring  nature) necessary
for a fair presentation of the financial  statements.  The results of operations
for the three  months and six months  ended March 31,  1999 are not  necessarily
indicative of the results to be expected for the full year.

Note 2 - Basic loss per share calculations

The  computation of net earnings (loss) per common share has been based upon the
weighted  average  number of shares of outstanding  common stock,  which for the
three month periods  ended March 31, 1999 and March 31, 1998 were  8,452,420 and
3,620,235,  respectively.  The weighted average number of shares outstanding for
the six month periods ended March 31, 1999 and March 31, 1998 were 7,593,643 and
3,378,748, respectively.

Note 3 - Accounting Change

The Company adopted Statement of Accounting  Standards #128, Earnings per Share,
during the quarter  ended  December 31,  1997.  Since the Company has reported a
loss  only the  basic  earnings  (loss)  per share is  thereby  reported  as the
reporting of diluted  loss per share would be  anti-dilutive.  The  inclusion of
converted  preferred  shares in the  calculation of weighted  average shares for
diluted  earnings per share  purposes would be  anti-dilutive  and per FASB 128,
cannot be included in the financial statements.

Note 4 - Equity Transactions

During the six month period ended March 31, 1999,  the Company  raised  $250,000
and  retired  preferred  stock for the  issuance of  1,405,000  shares of common
stock. These funds were used for working capital purposes.

On March 24, 1999 the Company  issued a 9%  convertible  promissory  note in the
face amount of $666,667  for cash  consideration  of $500,000  before  placement
fees.  The note's  maturity is March 1, 2003,  and allows the holder to purchase
this  Company's  common  stock  at  105%  of the  market  price  at the  time of
conversion.

                                       5
<PAGE>

                 THERMACELL TECHNOLOGIES, INC. AND SUBSIDIARIES


Item 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The  statements  contained  in this Report on Form  10-QSB,  that are not purely
historical, are forward-looking information and statements within the meaning of
Section 27A of the  Securities  Act of 1933 and  Section  21E of the  Securities
Exchange  Act  of  1934.  These  include  statements   regarding  the  Company's
expectations,   intentions,   or  strategies   regarding  future  matters.   All
forward-looking  statements  included in this document are based on  information
available  to the Company on the date  hereof.  It is important to note that the
Company's  actual results could differ  materially  from those projected in such
forward-looking  statements  contained in this Form 10-QSB. The  forward-looking
statements  contained  here-in are based on current  expectations  that  involve
numerous risks and uncertainties.  Assumptions relating to the foregoing involve
judgments  regarding,  among  other  things,  the  Company's  ability  to secure
financing  or  investment  for  capital   expenditures,   future   economic  and
competitive market conditions,  and future business decisions. All these matters
are  difficult  or  impossible  to predict  accurately  and many of which may be
beyond the  control of the  Company.  Although  the  Company  believes  that the
assumptions underlying its forward-looking statements are reasonable, any of the
assumptions could be inaccurate and,  therefore,  there can be no assurance that
the  forward-looking  statements  included  in this form 10-QSB will prove to be
accurate.


GENERAL

The  Company was  incorporated  in Florida in August,  1993,  for the purpose of
developing,  manufacturing and marketing insulating materials and coatings using
partially  evacuated glass  microspheres  ("shells").  The Company's  technology
utilizes the  insertion  of the shells in various  materials  and products  that
improve the thermal resistive characteristics of such products.

The Company's  business strategy is to (i) expand the marketing and distribution
of  ThermaCool(TM)  paints  and  coatings,  (ii)  develop  and  manufacture  the
Company's own shells and (iii) expand the shell  technology  to other  products,
such as drywall, gypsum board, home siding materials, and space foam insulation,
among others.

On November 30, 1995,  the Company  acquired the assets of C.F.  Darling Paint &
Chemicals,  Inc.,  a paint  manufacturing  company,  located in New Port Richey,
Florida.  The Company  acquired these assets so that it would have a facility to
produce and develop paints and coatings for its ThermaCool(TM) product line.

On March 19, 1997, the Company  completed a public offering for 1,375,000 Units,
each Unit  consisting  of one share of Common Stock,  $.0001 par value,  and one
Series A Redeemable Common Stock Purchase Warrant, at a price of $4.00 per Unit.
In addition,  the underwriter  exercised its over-allotment  purchase option and
purchased 206,250 additional Units at the initial per Unit public offering price
less the  underwriting  discounts  and  commission.  The net proceeds  from this
offering was more than $4.7 million.

On July 28,  1997,  the  Company  acquired  all the  outstanding  common  stock,
representing 100% ownership, of Atlas Chemical Company, a paint manufacturer and
distributor,  located in Miami,  Florida. The Company acquired this firm so that
it would have a larger  manufacturing  facility  to both  expand  production  of
paints and coatings and to obtain an established marketing  distribution channel
which  included  major  accounts such as Builders  Square,  Ace Hardware,  among
others.

On March 2, 1998, the Company  acquired the assets of Ladehoff  Paints,  Inc., a
paint manufacturer and distributor located in Mesa. Arizona.  The total purchase
price was $115,000. This acquisition is classified as a purchase transaction.

                                       6
<PAGE>

                 THERMACELL TECHNOLOGIES, INC. AND SUBSIDIARIES


On  October  15,  1998,  the  Company  agreed to acquire  T-Coast  Pavers/Sealco
Systems,  Inc.  which have annual  revenues of more than $2 million.  ThermaCell
acquired  these  associated  businesses  effective  December 1, 1998 for 300,000
shares of its common  stock valued at $300,000  and in an  employment  agreement
with its founder and key  executive,  a payment of an additional  300,000 shares
over the three year employment period.  This company provides paver installation
and driveway sealant and coating services  primarily to contractors in Southeast
Florida.

The Company  acquired  American  Paints,  Inc., a Pompano  Beach,  Florida paint
manufacturer and distributor  with $2.5 million in annual revenues,  for 572,000
common  shares  on  December  1,  1998.  American  Paints'  operations  will  be
consolidated into the Company's Atlas manufacturing facility to reduce duplicate
costs and increase operating profits.

On January 22, 1999, the Company launched its  www.paint-n-stuff.com  e-commerce
web site that includes more than 10,000 name brand home, boating, and commercial
building paint,  hardware  supplies and other improvement items for contractors,
dealers and consumers.  This  represents the first time such a complete array of
these products has been offered on an internet site.

The Company has  sustained  significant  operating  losses since its  inception.
Management's strategy of expanding the ThermaCool(TM) product line, developing a
commercially  viable  manufacturing  process for shells and  expansion  into new
markets for its shell technology may result in the Company incurring  additional
losses due to the costs associated with these strategies. The Company expects to
incur losses until it is able to increase its sales, expand its product line and
increase its distribution  capabilities to a sufficient  revenue level to offset
ongoing operating and expansion costs.

RESULTS OF OPERATIONS

Three months ended March 31, 1999 compared to three months ended March 31, 1998

Total  consolidated  revenue  for the three  months  ended  March  31,  1999 was
$1,128,941 compared to $712,347 for the same period of 1998, which represents an
increase of $416,594,  or 58%.  This  increase was  primarily  attributed to the
additional   revenues   of  two  recent   acquisitions:   American   Paints  and
T-Coast/Sealco  Systems,  Inc. The revenues for the Company's  existing business
declined for this period over the prior period.  This decline  resulted from the
seasonal  factors within the Company's  Florida markets that depressed sales for
the period that is typical for this time of year.

Gross  profit  margins were 31.0% and 33.4%,  respectively,  for the three month
period  ended March 31,  1999,  as compared to the prior  period ended March 31,
1998.  This  decrease is the result of a change in the mix of paint and coatings
products sold by the Company, and in part, by lower contribution margin from the
America  Paints and Sealco  acquisitions.  Sealco  has  traditionally  had gross
profit  margins  in  the  16%  range.  The  Company  expects  that  with  buying
efficiencies  and the  opportunity to provide all coating and sealant needed for
the  Sealco  operations,  that  business'  overall  gross  profit  margin can be
improved.

For  the  three  months  ended  March  31,  1999,  total  selling,  general  and
administrative  expenses  were  $667,854 as  compared  to $408,424  for the same
period of the previous  year, an increase of $259,430,  or 63%. This increase is
the result of higher marketing,  staffing and other general expenses  associated
with both the  Company's  acquisitions.  The  Company  has taken steps to reduce
duplication  of personnel and is in the process of  consolidating  its staffing,
marketing,  and production for more efficient and effective business  operations
for both  recent  acquisitions.  With the  expansion  of  distribution  channels
provided by the American Paints acquisition, the Company anticipates substantial
benefit from the sales of products to an expanded customer base.

The Company  experienced a loss from  operations of $317,615 for the three month
period ended March 31, 1999 as compared to a loss of $170,224 for the same prior
year period. This increase in the operating loss over that of the preceding year
period reflects the lower gross margin  contribution from the Company's revenues
and the higher S. G & A expense during this period.  Management anticipates that
increasing  levels of sales,  including the  contribution  of both of the recent
acquisitions,  will result in improvement in future  operating  performances and
eventually profitable operations.

                                       7
<PAGE>

                 THERMACELL TECHNOLOGIES, INC. AND SUBSIDIARIES


Based upon management's  current estimates of future taxable income,  management
has determined that a valuation  allowance of fifty percent (50%) is appropriate
during the current  period  ended March 31, 1999 to  represent  that  portion of
deferred taxes that may be realized in future periods.

The interest  expense for the period ended March 31, 1999 was $6,629 as compared
to the prior  year's  quarter of $2,215.  The  interest  expense for the current
period was  incurred  primarily  for  financing  of vehicles as was the interest
expense for prior period.  The prior period  benefited  from interest  income of
$13,080 and the  settlement of an  outstanding  payable that provided a one-time
income benefit of $45,045.

The basic loss, after income tax benefit, and basic loss per share were $259,396
and $0.03 per share  respectively,  for the three months ended March 31, 1999 as
compared  to a basic  loss  and  basic  loss  per  share  of  $91,451  and  $.03
respectively,  for the same period in 1998. This loss represents a 284% increase
over the basic loss experienced in the year ago quarter.  The loss per share for
the period was the same as the previous  year ago period.  The weighted  average
shares  outstanding  for the  quarter  ended  March 31,  1999 was  8,452,420  as
compared to 3,620,235 for the preceding year quarter ended March 31, 1998.

The  Company  has  focused,  in the recent  quarter  ended  March 31,  1999,  on
consolidating  its recently  acquired  American paint  operations with its Miami
based production  facility.  Presently all paints are manufactured at that Miami
location.  The third  quarter of this fiscal year will  benefit  from the higher
sales contributions of the two recent acquisitions that should result in overall
profitability for the Company.  Thereafter, the company will aggressively market
its paint and coatings products, with the added opportunity to sell its expanded
product line to a greater  customer  base.  Its strategy  will be to continue to
expand  within the  Sunbelt  Region of the United  States.  In  addition  to the
Company's   marketing  efforts,   the  recent   acquisitions  will  further  the
utilization of the Company's paint and coatings production capacity.  Management
continues to be optimistic about the benefits of its near-term strategy.

The Company anticipates  improvements in raw material purchasing  economies that
will result in further cost savings in its  purchases  within its  manufacturing
operation.  This  benefit will  continue in this fiscal  year.  The Company also
anticipates  improvement  in gross  profit  margins  during the  balance of this
fiscal year resulting from these improved purchasing economies.

Six months ended March 31, 1999 compared to six months ended March 31, 1998

Total revenue for the six months ended March 31, 1999 was $1,940,351 compared to
$1,470,631  for the same  period  of  1998,  which  represents  an  increase  of
$469,720,   or  32%.  The  increase  was  primarily  the  result  of  the  sales
contribution of the American Paints and T-Coast acquisitions.

Gross profit margins were 30% and 34%,  respectively,  for the six-month  period
ending  March 31, 1999 as compared to the prior  period  ending  March 31, 1998.
This  decrease  is the  result  of a  change  in the mix of paint  and  coatings
products sold by the Company, and in part, by lower contribution margin from the
America  Paints and Sealco  acquisitions.  Sealco  has  traditionally  had gross
profit margins in the 16% range.

For  the  six  months  ended  March  31,  1999,   total  selling,   general  and
administrative  expenses  were  $1,185,314  as compared to $748,069 for the same
period of the previous year, an increase of approximately $437,245, or 58%. This
increase is primarily the result of the Company's  recent  acquisitions and once
the expected  consolidation  of operations  is  completed,  S G & A expenses are
expected to become a lower  percentage  of sales.  Management  anticipates  that
further  increases in sales while  controlling its S G & A expense levels,  will
result in an improvement in its future operating performance.

                                       8
<PAGE>

                 THERMACELL TECHNOLOGIES, INC. AND SUBSIDIARIES


The Company  continued to experience a loss from  operations of $596,808 for the
six month period ending March 31, 1999 as compared to a loss of $244,294 for the
same prior year period.

Based upon management's  current estimates of future taxable income,  management
has determined that a valuation  allowance of fifty percent (50%) is appropriate
during the current  period  ending March 31, 1999 to  represent  that portion of
deferred taxes that may be realized in the future.

The net loss,  after  income  taxes  benefit but before  dividends  on preferred
stock,  and net loss per share was  $481,474  for the six months ended March 31,
1999 as  compared to a net loss of  $143,505  for the same period in 1998.  This
represented  an increase in the loss of $337,969  for this period as compared to
the year before six-month period ended March 31, 1998. The basic earnings or net
loss after  preferred  dividends  on  preferred  stock,  and the basic per share
earnings or net loss  attributable  to common shares were $481,474 and $0.06 for
the six months  ended March 31,  1999 as compared to a net loss of $143,505  and
$0.05 on the same basis for the same period in 1998.  The diluted  earnings  per
share are $0.06 and $0.05 for these respective periods.

This current  six-month  period loss per share was higher even though there is a
dilutive  effect with more common  shares  being  outstanding.  During these two
comparable  periods,  the weighted  average  shares  outstanding  increased from
3,378,748 to 7,593,642.  This increase is attributed to the Company's  financing
undertaken  during 1998 and the  exchange of  convertible  preferred  stock into
common stock and the dilutive effect of exercisable stock options.


LIQUIDITY AND CAPITAL RESOURCES

To  date,  the  Company  has  largely  funded  its  operations  and its  product
development  activities  with  funds  provided  by issuing  securities  and from
borrowings.  During the six months  ended,  the Company  received  $250,000  and
completed  conversion  of all  convertible  preferred  stock for the issuance of
1,405,000  shares  of  common  stock.  In  addition,  the  Company  issued  a 9%
redeemable  convertible  promissory  note in the face  amount  of  $666,667  for
consideration of $500,000 before placement expenses. This convertible note has a
March 1, 2002  maturity  date.  Conversion  for stock is at a 5%  premium to the
market price of the  Company's  common stock three days prior to the election to
convert. These funds were used for working capital purposes.

The  issuance  of common  stock  during the  period  was to  acquire  the equity
interest of the holder who held the preferred  stock position and to provide the
Company  with  $250,000 in funding.  The Company  received a release from former
preferred stock investor on March 4, 1999 that any obligations  that the Company
had were satisfied by the holders of the 1.4 million shares that were issued.

Net cash used in  operating  activities  for the six months ended March 31, 1999
was  $726,719  compared  to net cash used of $829,498  for the six months  ended
March 31, 1998.  This  decrease in cash used by operating  activities is despite
the higher net loss and the  increase  in prepaid  assets  were offset by higher
levels of accounts payables and accrued expenses.

Cash used in  investing  activities  for the six months ended March 31, 1999 and
1998 were $1,586,701 and $251,009,  respectively. The principal use of funds was
for two  acquisitions-  American  Paints and T-Coast/  Sealco Systems  completed
during this period.  In addition,  capital  expenditures  for the recent  period
decreased to $70,495 from  $154,669 over the prior year's  period.  There was no
acquisition in the year ago period. The recent period includes a expenditure for
patents while in the year ago period there was no such expenditure.

                                       9
<PAGE>

                 THERMACELL TECHNOLOGIES, INC. AND SUBSIDIARIES


Cash  provided by financing  activities  for the six months ended March 31, 1999
was  $2,637,912  as compared to cash used in financing  activities of $1,380,550
for the six months ended March 31, 1998.  During the recent period,  the Company
issued  common  stock  with an  aggregate  value of  $2,212,888  for both of its
current period acquisitions. Shareholder loans increased during this period that
included the assumption of certain company incurred  professional  expenses by a
shareholder.

As of March 31,  1999,  the  Company had net working  capital of  $1,423,376  as
compared to $616,709 at fiscal year ended  September 30, 1998.  This increase in
net working capital of $806,667 is primarily due to in higher levels of accounts
receivable  and  inventories  while this increase was more than offset by higher
levels of accounts payable and accrued expenses.  The Company's ratio of current
assets to current  liabilities  was 2.0 at March 31, 1999 and 2.1 at fiscal year
ended September 30, 1998.

The Company is not  presently  profitable  and continues to fund itself from the
proceeds of securities placements.  Once the Company achieves profitability,  it
will then be in a position to fund itself on an operating basis.

The Company  continues to focus its marketing  efforts within the Sunbelt Region
of the United States to increase  consumer  awareness and acceptance of both its
existing and new products. In addition to this marketing effort, the Company has
positioned  itself  to  expand  the  near  term  production  of its  proprietary
products.

Management  believes that additional  capital will be needed to fund its present
plan to build within this fiscal year a manufacturing facility to produce shells
for its paint and coating  technology  products.  The Company is optimistic that
such funds will be available from investment or financing sources to provide for
this expansion plan. Should funds not be readily  available,  management intends
to defer  the  building  of the  manufacturing  facility  to a later  time  when
appropriate  funding  can be  arranged.  The  Company  is in need of  additional
funding to provide for its working capital requirements over the next six months
to supplement the cash proceeds that can be generated from its recently acquired
businesses.  Should such  funding not be  available,  the Company  would have to
significantly curtail its planned operations to achieve breakeven operations.



PART II - OTHER INFORMATION

Item 1.           Legal Proceedings.

During May 1999,  the  attorneys  for the  Company  and  Innovation  Associates,
Inc.("IA")  reached an agreement to settle  litigation  that was commenced by IA
for trade secrets misappropration among other matters. As part of the settlement
of this  litigation,  the Company has agreed to license certain patents relating
to  microspheres  that are owned by IA.  Consideration  for such  license is the
payment of $25,000 and the issuance of $500,000  worth of the  Company's  common
stock.  Such common  stock shall bear a legend as to  marketability  until it is
registered.  With  this  licensing  of  IA's  patents,  the  litigation  will be
dismissed.  The  Company  intends  to  utilize  the  IA  patents  with  its  own
microsphere technologies to strengthen its patent position in this area.

On February 23, 1999, the Company was notified that the Kevin Horrell litigation
against the  Company  and Mr.  John  Pidorenko,  the  Company's  president,  was
dismissed. Prior to this notice, Mr. Pidorenko, transferred 40,000 shares of the
Company's  common  stock,  he  personally  owned,  to Mr.  Horrell.  A  complete
settlement of this matter has been made.

On March 1, 1999, the Company reached a settlement agreement with David Feingold
and his law firm of Feingold & Kam,  RAM  Capital  Partners,  Ltd.,  Diversified
Lending Company and RAF Enterprises  regarding  compensation and the issuance of
the Company's common stock, among other matters. As a result of this settlement,
the Company's obligations to the investor who held a convertible preferred stock
position  was  satisfied.  Other than the Company  issuing  common  stock during
November 1998, no further consideration was paid.

                                       10
<PAGE>

                 THERMACELL TECHNOLOGIES, INC. AND SUBSIDIARIES


On February 4, 1999, a complaint was filed in the United States  District Court,
Middle District of Florida by Mr. Russell Haraburda and Eden Group, Inc. against
John Pidorenko,  the Company's president, and the Company for monies purportedly
due for  arranging  financing for the Company prior to its IPO in March of 1997.
The Company does not believe any monies are due Mr.  Haraburda  or his firm.  In
addition,  the Company has been assigned two promissory notes of the Eden Group,
Inc.  that are unpaid.  The Company  will  vigorously  challenge  any demand for
payment by Mr.  Haraburda and will seek full payment under its promissory  notes
from the Eden Group.


Item 5.           Other Information

On March 18, 1999, Mr. Donald Huggins was appointed to the board of directors.


Item 6.           Exhibits and reports on Form 8K

         Form 8-K filed on December 14, 1998 containing  information  regarding
the acquisition of American Paints, Inc.

         Form 8-K filed on January 11, 1998 containing information regarding the
acquisition of T-Coast Pavers/Sealco Systems, Inc.

         Legal and  Consulting  Engagement  Agreement,  dated  October  8, 1998,
between the Company and the law firm of Feingold & Kam.

SIGNATURES

Pursuant to the  requirements  of the Securities Act of 1934, the Registrant had
duly caused the report to be signed on its behalf by the  undersigned  thereunto
duly authorized.


                                             ThermaCell Technologies, Inc.


Dated    5/17/99
                                             /s/ Gerald Couture
                                             ---------------------------------
                                             Gerald Couture
                                             Vice-President, Finance and CFO