<PAGE>
 
                                   FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549



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

       For the quarterly period ended December 31, 1995 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 0-16277

                          FI LIQUIDATING COMPANY, INC.
                          ----------------------------
             (Exact name of registrant as specified in its charter)

                 Delaware                     94-2666121
                 --------                     ----------
     (State of other jurisdiction of         (IRS Employer
     incorporation or organization)       Identification No.)

                                 Hughes Center
                                   Suite 200
                           3753 Howard Hughes Parkway
                            Las Vegas, Nevada 89109
                                 (702) 892-3772

(Address, including zip code and telephone number, including area code of
registrant's principal executive officers)

Indicate by checkmark 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 periods 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 the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.

At December 31, 1995, 9,281,453 shares of common stock of the registrant were
outstanding.
<PAGE>
 
                         PART I - FINANCIAL INFORMATION
                         ------------------------------

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



                          FI LIQUIDATING COMPANY, INC.
                      CONSOLIDATED STATEMENT OF OPERATIONS
                    (in thousands, except per share amounts)
                                  (unaudited)
<TABLE>
<CAPTION>
                                                      Three Months        Nine Months
                                                    Ended December 31   Ended December 31
                                                    -----------------   -----------------
                                                      1995     1994      1995      1994
                                                    -------   -------   -------   -------
<S>                                                 <C>       <C>       <C>       <C>
Net sales                                           $    -    $    -    $    -    $    -
Costs and expenses:
  Cost of sales                                          -         -         -         -
  General and administrative                            45        22       143        84
                                                    ------     -----    ------    ------
 
Loss from operations                                   (45)      (22)     (143)      (84)
Realized and unrealized gain on Flex Holdings:
  Net realized gain                                    535       213     1,525       249
  Change in unrealized appreciation                    518       (34)    1,818     1,606
Other income                                            47       497        44       467
                                                    ------     -----    ------    ------
Income before provision for taxes on
  income and extraordinary credit                    1,055       654     3,244     2,238
Provision for taxes on income                          359       222     1,103       761
                                                    ------     -----    ------    ------
Income before extraordinary credit                     696       432     2,141     1,477

Extraordinary credits - utilization of net
  operating loss carryforward                          359       222     1,103       761
                                                    ------     -----    ------    ------
Net income                                          $1,055     $ 654    $3,244    $2,238
                                                    ======     =====    ======    ====== 
Net income per share:
  Income before extraordinary credit                $  .07     $ .05    $  .23    $  .16

  Extraordinary credit                                 .04       .02       .12       .08
                                                    ------     -----    ------    ------  
  Net income                                        $  .11     $ .07    $  .35    $  .24
                                                    ======     =====    ======    ======
Shares used in computing per share amounts           9,311     9,391     9,347     9,391
                                                    ======     =====    ======    ======
</TABLE> 
See accompanying notes.

                                       2
<PAGE>
 
                          FI LIQUIDATING COMPANY, INC.
                      CONDENSED CONSOLIDATED BALANCE SHEET
                                 (in thousands)
                                  (unaudited)
<TABLE>
<CAPTION>
  
                                                  December 31   March 31
                                                     1995         1995
                                                  -----------   --------
<S>                                               <C>           <C>
Assets
Current assets:
     Cash                                            $  2,722   $     10
     Marketable securities                                  -        395
     Prepaid expenses and other                            21         20
     Assets held for sale                                  75         75
                                                     --------   --------
           Total current assets                         2,818        500
 
Investment in Flextronics International Ltd.            4,691      3,725
                                                     --------   --------
                                                     $  7,509   $  4,225
                                                     ========   ========

Liabilities and Stockholders' Equity
 
Current liabilities:
     Accounts payable                                  $   10     $   21
     Other accrued liabilities                            463        412
     Dividend payable                                   2,135         -
                                                     --------   --------
           Total current liabilities                    2,608        433
 
Commitments and contingency
Stockholders' equity:
     Preferred Stock, $.01 par value;
       10,000 shares authorized;
     Common Stock, $.01 par value;
       25,000 shares authorized;
       9,281 shares issued and outstanding
       in both 1995 and 1994                               93         93
     Additional paid-in capital                        29,748     29,748
     Accumulated deficit                              (24,940)   (26,049)
                                                     --------   --------
           Stockholders' equity                         4,901      3,792
                                                     --------   --------
</TABLE>
                                                     $  7,509   $  4,225
                                                     ========   ========


See accompanying notes.

                                       3
<PAGE>
 
                          FI LIQUIDATING COMPANY, INC.
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                                 (in thousands)
                                  (unaudited)

<TABLE>
<CAPTION>
 
 
                                                             Nine Months
                                                           Ended December
                                                         -------------------
                                                           1995       1994
                                                         --------   --------
<S>                                                      <C>        <C>
Operating activities:
     Net income                                          $ 3,244    $ 2,238
     Adjustment to reconcile net income
     to net cash used for operating activities:
       Realized and unrealized gain on
         Flextronics International Ltd.                   (3,343)    (1,855)
       Changes in operating assets and liabilities:
          Accounts receivable                                  -        111
          Prepaid expenses and other assets                   (1)        99
          Accounts payable and accrued liabilities            40       (671)
                                                         -------    -------
          Net cash used for operating activities             (60)       (78)
 
Investing activities:
     Proceeds from sales of shares in Flextronics
       International Ltd.                                  2,377        547
     Proceeds from marketable securities, net                395          -
     Exercise of option from Flextronics
       International Ltd.                                      -       (500)
                                                         -------    -------
          Net cash provided by investing activities        2,772         47
                                                         -------    -------
 
Increase (decrease) in cash                                2,712        (31)
Cash beginning of period                                      10         45
                                                         -------    -------
Cash end of period                                       $ 2,722    $    14
                                                         =======    =======
 
</TABLE>

See accompanying notes.

                                       4
<PAGE>
 
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
              ----------------------------------------------------


1.   BASIS OF PRESENTATION

     The accompanying financial statements as of December 31, 1995 and March 31,
     1995 and for the three months and nine months ended December 31, 1995 and
     December 31, 1994 have been prepared on a liquidating basis of accounting
     with assets and liabilities stated at fair value.  The Company has wound
     down its operations and is continuing to implement a formal plan of
     liquidation approved by the Shareholders in June 1992.

     The condensed consolidated financial statements at December 31, 1995 and
     March 31, 1995 and for the three months and nine months ended December 31,
     1995 and December 31, 1994, respectively, are unaudited but include all
     adjustments (consisting only of normal recurring adjustments) which are, in
     the opinion of management, necessary to present a fair statement of the
     results of interim periods.

     The condensed consolidated financial statements and notes thereto should be
     read in conjunction with the consolidated financial statements for the year
     ended March 31, 1995, as presented in the Registrant's Annual Report on
     Form 10-K.

2.   INVESTMENT IN FLEXTRONICS INTERNATIONAL LTD.

     At March 31, 1994, the Company held 171,000 shares of Flextronics
     International Ltd. capital stock.  In addition, the Company held an option
     from Flextronics International Ltd. to purchase 155,843 of its ordinary
     shares at an exercise price of $3.21 per share ("Flex Option"), as well as
     an option from certain shareholders of Flextronics International Ltd. to
     acquire 110,379 additional ordinary shares of Flextronics International
     Ltd. at an exercise price of $3.16 per share  (the "Shareholder Option").

     During fiscal 1995, the Company sold 55,500 shares of Flextronics
     International Ltd. for $772,375.  The Company exercised its options from
     Flextronics International Ltd. and purchased 155,843 shares for $500,000.
     The Company also negotiated a cashless exchange with the shareholders of
     Flextronics International Ltd. whereby the Company acquired 88,233 shares
     of Flextronics International Ltd. for the surrender of that option.

     During the three months ended June 30, 1995, the Company sold 60,000 shares
     of Flextronics International Ltd. for $933,125; during the three months
     ended September 30, 1995, the Company sold 30,000 shares for $720,000; and
     during the three months ended December 31, 1995, the Company sold 25,500
     shares for $723,469.

                                       5
<PAGE>
 
     The 155,843 shares acquired from Flextronics International Ltd. are
     "restricted securities" as that term is defined in Rule 144 under the
     Securities Act of 1933 (the "Act") and may not be resold to the public
     until November 18, 1996 unless the shares are registered under the Act or
     an exemption from registration is available. The 88,233 shares acquired by
     the Company for the option from shareholders of Flextronics International
     Ltd. are also "restricted securities" as that term is defined in Rule 144
     under the Act and may not be resold to the public until February 17, 1997
     unless the shares are registered under the Act or an exemption from
     registration is available. At December 31, 1995 the closing price for
     Flextronics International Ltd. as reported on NASDAQ was $30.00 per share.
     At December 31, 1995 the reported fair value of the 155,843 shares which
     the Company may not resell to the public under Rule 144 until November 18,
     1996 and the 88,233 shares which the Company may not resell to the public
     under Rule 144 until February 17, 1997 reflect discounts of 34% and 40%,
     respectively, from the closing price reported on the NASDAQ National Market
     System due to aforementioned restrictions on resale.


3.   NET INCOME PER SHARE

     Net income per share is computed based on the weighted average number of
     common shares and dilutive common stock equivalents.



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

OVERVIEW
--------

The Company has substantially completed a major restructuring and wind down of
its worldwide business and in June 1992 adopted a plan of liquidation.  As a
result of these activities, the Company's financial position at December 31,
1995, and its operating results for the three months and nine months then ended,
are not indicative of the Company's expected operating performance and liquidity
and capital resource needs.  The restructuring and wind down results in
eliminating revenues and expenses other than general and administrative expenses
needed to manage its assets and creditor relations.  The liquidation activities
of the Company will be the orderly disposal of its remaining assets to fund its
remaining obligations.  On January 4, 1996 the Company made a liquidating
dividend of $2,135,000 ($.23 per share) to holders of record of the Company's
common stock on December 21, 1995.  Following the dividend, the Company's
principal assets are 244,076 shares of Flextronics International Ltd. as well as
remaining cash of $587,000.

                                       6
<PAGE>
 
RESULTS OF OPERATIONS
---------------------

THREE MONTHS ENDED DECEMBER 31, 1995 COMPARED TO THREE MONTHS ENDED DECEMBER 31,
--------------------------------------------------------------------------------
1994
----

Because of the restructuring and wind down described in the preceding Overview,
any comparison of net revenues and operating expenses for the three months ended
December 31, 1995 to those for the three months ended December 31, 1994 is, in
the opinion of management, not meaningful.

For the three months ended December 31, 1995 realized and unrealized gain on
Flextronics International Ltd. of $1,053,000 was recognized.  (See Note 2 to
the financial statements.)  The market close on September 30, 1995 was $25.75
and the market close on December 31, 1995 was $30.00.  For the three months
ended December 31, 1994 realized and unrealized gain on Flextronics
International Ltd. of $179,000 was recognized.  The market close on September
30, 1994 was $14.625 and the market close on December 31, 1994 was $15.25.

Other income of $47,000 for the three months ended December 31, 1995 primarily
consisted of interest income of $44,000.  Other income of $497,000 for the three
months ended December 31, 1994 primarily consisted of a reduction in estimated
recovery on assets held for sale of $100,000, loss on rental activities of
$22,000 and reversal of provisions for claims against the Company which can no
longer be asserted of $618,000.

A provision for taxes of $359,000 is provided for the three months ended
December 31, 1995 based on income before extraordinary credits.  A provision for
taxes of $222,000 is provided for the three months ended December 31, 1994 based
on income before extraordinary credits.

NINE MONTHS ENDED DECEMBER 31, 1995 COMPARED TO NINE MONTHS ENDED DECEMBER 31,
------------------------------------------------------------------------------
1994
----

Because of the restructuring and wind down described in the preceding Overview,
any comparison of net revenues and operating expenses for the nine months ended
December 31, 1995 to those for the nine months ended December 31, 1994 is, in
the opinion of management, not meaningful.

For the nine months ended December 31, 1995 realized and unrealized gain on
Flextronics International Ltd. of $3,343,000 was recognized.  (See note 2 to the
financial statements.)  The market close on March 31, 1995 was $13.75 and the
market close on December 31, 1995 was $30.00.  For the nine months ended
December 31, 1994 realized and unrealized gain on Flex Holdings of $1,855,000
was recognized.  The market close on March 31, 1994 was $12.50 and the market
close on December 31, 1994 was $15.25.

                                       7
<PAGE>
 
Other income of $44,000 for the nine months ended December 31, 1995 primarily
consisted of interest income of $78,000 and reversal of provisions for claims
which can no longer be asserted of $17,000, net of expenses on the building held
for sale of $51,000.  Other income of $467,000 for the nine months ended
December 31, 1994 primarily consisted of reduction in estimated recovery on
assets held for sale of $100,000, loss on rental activities of $30,000,
reduction in estimated net realization of accounts receivable of $39,000 and
reversal of provisions for claims against the Company which can no longer be
asserted of $642,000.

A provision for taxes of $1,103,000 is provided for the nine months  ended
December 31, 1995 based on income before extraordinary credits.  A provision for
taxes of $761,000 is provided for the nine months ended December 31, 1994 based
on income before extraordinary credits.

CAPITAL RESOURCES AND LIQUIDITY
-------------------------------

For the nine months ended December 31, 1995 cash increased by $2,712,000 as
compared to a decrease of $31,000 for the nine months ended December 31, 1994.
Cash outflows from operating activities consisted primarily of winding down
operations and liquidating the assets in both years.  For the nine months ended
December 31, 1995 the cash inflow from investing activities reflects the sales
of Flextronics International Ltd. shares and liquidation of the marketable
securities.  For the nine months ended December 31, 1994 the cash inflow from
investing activities reflects the sales of Flextronics International Ltd.
shares, net of exercise of option from Flextronics International Ltd.

The Company's balance sheet at December 31, 1995 shows a shareholders' equity of
$4,901,000.  The Flextronics International Ltd. shares owned by the Company are
carried on the financial statements at $4,691,000 which is the aggregate fair
value of such shares based on the closing market price on NASDAQ on December 30,
1995 of $30.00 per share reduced for the significant restrictions on transfer.
(See Note 2 to financial statements.)

The Company has cash at December 31, 1995 of $2,722,000.  Such  cash, after
payment of the January 4, 1996 $.23 per share liquidating dividend of
$2,135,000, should be sufficient to complete an orderly liquidation.

The timing for the Company to complete the liquidation is dependent upon its
ability to obtain the necessary regulatory clearances and eliminate the
remaining restrictions on the disposition of assets.  The amount of the
liquidating distributions is primarily dependent on the performance of
Flextronics International Ltd. and the Company's ability to dispose of its
remaining assets and obligations.

                                       8
<PAGE>
 
SIGNATURES


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

                                  FI LIQUIDATING COMPANY, INC.
                                  (Registrant)


Date:  February 14, 1996             By: /s/John C. Roberts
                                         ------------------
                                         John C. Roberts
                                         President, Chief Executive
                                         Officer (Principal
                                         Executive Officer)


Date:  February 14, 1996
                                     By: /s/Michael R. Ramelot
                                         ---------------------
                                         Michael R. Ramelot
                                         Chief Financial Officer
                                         (Principal Financial
                                         Officer)

                                       9
<PAGE>
 
                          PART II - OTHER INFORMATION
                          ---------------------------


                           ITEM 1. LEGAL PROCEEDINGS
                           -------------------------

                                        
During the nine months ended December 31, 1995 there were no material
developments in legal proceedings since the report filed on Form 10-K for the
fiscal year ended March 31, 1995.


                   ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K
                   -----------------------------------------

(a)       Exhibits
          --------

          None.

(b)       Reports on Form 8-K
          -------------------

          No reports on Form 8-K were filed during the quarter ended December
          31, 1995.

                                       10