<PAGE>
 
                    U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, DC 20549

                                  FORM 10-QSB

               Quarterly Report under Section 13 or 15(d) of the
                        Securities Exchange Act of 1934

                   For the Quarter Ended September 30, 1996

                          Commission File No. 0-7765

                              Crowell & Co., Inc.
        ---------------------------------------------------------------
       (Exact Name of small business issuer as specified in its charter)

        GEORGIA                                        58-1021933
-------------------------------             -------------------------------
(State or other jurisdiction of            (IRS Employer Identification No.)
incorporation or organization)

                 432 South Belair Road, Augusta, Georgia 30907
                 ---------------------------------------------
                   (Address of principal executive offices)

Issuer's telephone number, including area code          (706) 855-1099



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 and (2) has been
subject to such filing requirements for the past 90 days. Yes  X  No
                                                              ---    ---
 
The number of shares outstanding of issuer's common equity as of October 31,
1996 is 2,520,835.

                                       1
<PAGE>
 
                              CROWELL & CO., INC.

                                     INDEX

                                                                     PAGE NO.
                                                                     --------

PART 1   -   FINANCIAL INFORMATION

             ITEM 1  -   Financial Statements  .......................   4

             ITEM 2  -   Management's Discussion and Analysis.........   8



                                       2
<PAGE>
 
                         PART 1 - FINANCIAL INFORMATION

Item 1.  Financial Statements

The following condensed consolidated financial statements of Crowell & Co.,
Inc., and Subsidiaries are included in Item 1:

     Condensed Consolidated Balance Sheet
          September 30, 1996

     Condensed Consolidated Statements of Operations and Accumulated Deficit
          Three month and nine month periods ended September 30, 1996
          and 1995

     Condensed Consolidated Statements of Cash Flows -
          Three month and nine month periods ended September 30, 1996 and 1995

     Notes to Condensed Consolidated Financial Statements

                                       3
<PAGE>
 
                     Crowell & Co., Inc., and Subsidiaries

                     Condensed Consolidated Balance Sheet
                              September 30, 1996
<TABLE>
<CAPTION>

                                     Assets
<S>                                                                   <C>                  
Properties held for resale & development                                                   
     Homes under construction and for sale                            $ 2,472,564          
     Developed residential                                                784,785          
     Land held for future development and other                           256,786          
                                                                          -------          
                                                                        3,514,135
                                                                        ---------          
                                                                                           
Cash, including escrow funds of $ 9,600                                   294,689          
                                                                          -------          
Receivables                                                                92,246
                                                                           ------              
                                                                                           
Property and equipment, net of depreciation                               390,800          
                                                                          -------          
                                                                                           
Other assets                                                               35,454          
                                                                           ------          
                                                                      $ 4,327,324          
                                                                      ===========          
                                                                                           
                      Liabilities and Stockholders' Equity                                 
                                                                                           
Notes payable to banks                                                $ 3,294,757          
                                                                      -----------          
                                                                                           
Accounts payable and accrued expenses                                     360,189          
                                                                          -------          
Stockholders' equity                                                                       
                                                                                           
     Preferred stock                                                    1,011,899          
     Common stock                                                         696,776          
     Paid-in capital                                                       33,648          
     Accumulated deficit                                               (1,069,945)          
                                                                       -----------          
                                                                          672,378          
                                                                          -------          
                                                                      $ 4,327,324          
                                                                      ===========           
</TABLE>
See notes to condensed consolidated financial statements.

                                       4
<PAGE>
 
                      Crowell & Co., Inc., and Subsidiaries

     Condensed Consolidated Statements of Operations and Accumulated Deficit
<TABLE>
<CAPTION>

                                                               Three Months Ended                 Nine Months Ended
                                                                  September 30,                      September 30,
                                                                  ------------                       ------------
                                                               1996           1995                1996           1995
                                                               ----           ----                ----           ----
<S>                                                        <C>           <C>                  <C>           <C>
Revenues
     Home sales                                            $ 2,201,385   $ 1,207,140          $ 5,169,155   $ 4,129,589
     All other revenues                                        249,382       376,117              857,291       770,057
                                                               -------       -------              -------       -------

                                                             2,450,767     1,583,257            6,026,446     4,899,646
                                                             ---------     ---------            ---------     ---------
Cost of revenues
     Homes                                                   2,002,129     1,250,027            4,618,826     3,963,523
     All other costs                                            41,049       131,611              406,789       196,922
                                                                ------       -------              -------       -------

                                                             2,043,178     1,381,638            5,025,615     4,160,445
                                                             ---------     ---------            ---------     ---------

Operating expenses                                             323,665       307,067            1,004,353     1,000,484
                                                               -------       -------            ---------     ---------

Operating income (loss)                                         83,925      (105,448)              (3,522)     (261,283)
                                                                ------      --------               ------      --------

Other income                                                    25,709        47,317               24,352        54,990
                                                                ------        ------               ------        ------

Net financial expense                                           38,757       122,989              184,637       329,773
                                                                ------       -------              -------       -------

     Income (loss) before income taxes                          70,877      (181,120)            (163,807)     (536,066)
                                                                ------      --------             --------      --------

Income tax expense                                                   0             0                    0         5,503
                                                                ------      --------             --------         -----

Income (loss) before discontinued operations                    70,877      (181,120)            (163,807)     (541,569)
                                                                ------     ---------             --------      --------

Discontinued Operations                                         32,941        44,759               81,161       (72,713)
                                                                ------        ------               ------       -------

Income (loss)                                                  103,818      (136,361)             (82,646)     (614,282)
                                                               -------      --------              -------      --------

Accumulated deficit
     Beginning of period                                    (1,173,763)     (761,739)            (987,299)     (283,818)
     End of period                                          (1,069,945)     (898,100)          (1,069,945)     (898,100)
                                                             ---------      --------           ----------      --------

Weighted average common shares outstanding                   2,520,835     2,520,835            2,520,835     2,520,835

Net loss per common share
     Primary earnings per share
     Income (loss) from continuing operations                    $ .02        ($ .08)              ($ .09)       ($ .24)
     Income (loss) from discontinued operations                    .01           .02                  .03          (.03)
                                                                   ---           ---                  ---          ----

                                                                 $ .03        ($ .06)              ($ .06)       ($ .27)
</TABLE>
See notes to condensed consolidated financial statements.

                                       5
<PAGE>
 
                      Crowell & Co., Inc., and Subsidiaries

                 Condensed Consolidated Statements of Cash Flows
<TABLE>
<CAPTION>

                                                                     Three Months Ended             Nine Months Ended
                                                                        September 30,                  September 30,
                                                                        ------------                   ------------
                                                                    1996          1995               1996          1995
                                                                    ----          ----               ----          ----
<S>                                                             <C>          <C>                 <C>          <C>

Cash flows from operating activities
     Net income (loss)                                          $  103,818    ($ 136,361)       ($   82,646)  ($  614,282)
     Adjustments to reconcile net income (loss) to net
     cash provided by (used in) operating activities
     Depreciation and amortization                                  20,700        22,899             62,100       103,050
         Net (increase) decrease in inventory,
         receivables, prepaids, payables and accruals              842,640      (113,044)           629,816       903,242
                                                                ----------     ---------         ----------    ----------

     Net cash provided by (used in) operating activities           967,158      (226,506)           609,270       392,010
                                                                ----------     ---------         ----------    ----------

Cash flows from investing activities
     Purchases of property and equipment                           (78,066)       (5,992)          (113,222)      (18,630)
     Receipts on notes                                                   0       215,747                  0       485,630
                                                                ----------     ---------         ----------    ----------

     Net cash provided by (used in) investing activities           (78,066)      209,755           (113,222)      467,000
                                                                -----------    ---------         ----------    ----------
Cash flows from financing activities
     Proceeds from borrowings                                      762,717       826,194          3,718,274     1,960,644
     Payments of borrowings                                     (1,390,961)   (1,001,880)        (4,188,197)   (2,741,689)
                                                                -----------    ---------         ----------    ---------- 

     Net cash used in financing activities                        (628,244)     (175,686)          (469,923)     (781,045)
                                                                -----------    ---------         ----------    ---------- 

Net increase (decrease) in cash                                    260,848      (192,437)            26,125        77,965

Cash at beginning of period                                         33,841       500,734            268,564       230,332

Cash at end of period                                           $  294,689     $ 308,297         $  294,689    $  308,297
                                                                ==========     =========         ==========    ==========
Supplemental disclosures
     Income taxes paid                                                   0             0                  0         5,503
     Interest paid, net of amount capitalized                   $   51,229     $ 108,673         $  200,807    $  306,446

</TABLE>

See notes to condensed consolidated financial statements.

                                       6
<PAGE>
 
                      CROWELL & CO., INC. AND SUBSIDIARIES

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               September 30, 1996

Note 1 - Basis of Presentation

The accompanying financial statements are presented in accordance with the
requirements of Form 10-QSB and consequently do not include all of the
disclosures normally required by generally accepted accounting principles or
those normally made in the Company's annual Form 10-KSB filing. Accordingly, the
reader of this Form 10-QSB may wish to refer to the Company's Form 10-KSB for
the year ended December 31, 1995, for further information.

The financial information has been prepared in accordance with the Company's
customary accounting practices and has not been audited. In the opinion of
management, the information presented reflects all adjustments necessary for a
fair statement of interim results. All such adjustments are of a normal and
recurring nature.

Note 2 - Loss per share

The loss per common share has been computed using the weighted average of the
number of shares outstanding during the three and nine month periods ended
September 30, 1996 and 1995. Because inclusion of convertible preferred stock
would have an anti-dilutive effect on the loss per common share, the convertible
preferred stock is excluded from the computation of the income (loss) per common
share assuming full dilution for the quarters ended September 30, 1996 and 1995,
and for the nine months ended September 30, 1996 and 1995.

                                       7
<PAGE>
 
Item 2.       Management's Discussion and Analysis

Results of Operations for the Quarters ended September 30, 1996 and 1995

The primary sources of revenue of Crowell & Co., Inc., and Subsidiaries (the
"Company") are the development of residential properties for resale and
homebuilding.

Other sources of revenue include sales of computer software and hardware,
operation of a pool and tennis facility, and various other real estate related
activities.

Total revenues for the quarter ended September 30, 1996, are $867,510 more than
revenues for the quarter ended September 30, 1995. This can be attributed to an
increase in home sales of $994,245.

Currently sales backlog on Company constructed homes is $1,021,490. Construction
on these homes is 53.1% complete. Backlog represents signed contracts for the
purchase of homes where the property has not been closed. Therefore, the Company
still holds legal title and has not recognized any income.

The gross profit margin on home sales increased in the quarter ended September
30, 1996, as compared to the quarter ended September 30, 1995, from (3.6%) to
9.1%.

Operating expenses increased by $16,598 for the quarter ended September 30,
1996, as compared to the same quarter last year. Operating expenses include
salaries, office expenses, occupancy, depreciation, advertising and promotion,
taxes and licenses, legal and accounting, communications, and other expenses.
These expenses are fixed in nature and normally do not fluctuate with different
revenue levels.

The Company had net income for the third quarter of 1996 of $103,818 compared to
a net loss of $136,361 for the third quarter of 1995. Management believes the
company will sustain a loss for the fourth quarter of 1996 based on sales
activity in new home sales.

Liquidity and Capital Resources

The Company has obtained financing historically by borrowing from conventional
lending sources using land acquired for development as security for loans.

Current and future liquidity needs are expected to be met by use of the proceeds
from home, lot, and land sales and the proceeds from loans, using lands
purchased for development as collateral. Existing development loans and
commitments available to the Company have been made by various financial
institutions and are secured by raw land and the improved lots held for resale.
Payments of interest are due monthly or quarterly and a portion of the principal
is repaid as each lot is sold. The Company has approximately $620,000 in unused
development 

                                       8
<PAGE>
 
loan commitments available to use in the development of residential properties
as of September 30, 1996.

Residential home construction costs are expected to be met through the use of
existing commitments aggregating approximately $600,000 as of September 30,
1996, and through the use of additional commitments also using the improved lots
as collateral. Lot acquisition costs and home construction costs are financed by
construction loans from a number of conventional lending sources, generally
lending 90-95% of the costs of the home, secured by the lot and improvements.
These loans are repaid upon the sale of the home. These loans are negotiated and
closed on a project-by-project and lot-by-lot basis.

In addition to the development loans, the Company has a loan agreement with an
Augusta, Georgia, savings and loan institution in the amount of approximately
$390,000 which is secured by real property.

The Company also has several other loans with various lenders which are secured
by various Company assets.

Financing arrangements for long-term needs have not been made. Such arrangements
in the land development business are generally made on a project-by-project
basis. Debt service on all existing loans (loan balances totaled $3,294,757 as
of September 30, 1996) and funds for operations are expected to be met from the
proceeds of home, lot, and land sales. Notes maturing in the next twelve months
total approximately $2,900,000. At September 30, 1996, available cash and
proceeds from home, lot, and land sales were expected to be sufficient to meet
the Company's requirements for the following quarter. The Company historically
has renewed these notes as is common in the development business. The notes will
eventually be repaid from proceeds of land, lot, and home sales.

The Company expects to, as it has done in the past, sell land it presently owns
to meet liquidity needs. Coupled with revenues from normal sources, such sales
would be expected to generate sufficient cash to meet liquidity requirements.

The Company has net operating loss carryforwards available of approximately
$2,050,000 to offset against future federal and state taxable income. The
current value of these carryforwards computed at maximum federal and state
income tax rates is approximately $800,000. This amount is not reflected in the
financial statements.

Results of Operations for the Nine Month Periods Ended September 30, 1996 and
1995

Total revenues for the nine months ended September 30, 1996, are $1,126,800 more
than for the nine months ended September 30, 1995. This can be attributed
primarily to an increase in home sales of $1,039,566.


                                       9
<PAGE>
 
Gross profit percent on home sales increased from 4.0% for the nine months ended
September 30, 1995, to 10.6% for the nine months ended September 30, 1996.
Management believes gross profit percent will remain at 1996 levels for the next
nine months.

Operating expenses increased by $3,869 for the nine months ended September 30,
1996, as compared to the nine months ended September 30, 1995. Management
believes operating expenses will remain stable for the nine months ending June
30, 1997.

Net loss for the nine months ended September 30, 1995, was $614,282 compared
with a net loss of $82,646 for the nine months ended September 30, 1996.
Increased sales volume and higher gross margins accounted for the difference.

                                       10
<PAGE>
 
                                   SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

                                              Crowell & Co., Inc.

November 12, 1996                             By:  Mark L. Gilliam
                                                  ---------------------------
                                              Mark L. Gilliam
                                                  Vice President on Behalf of
                                                  the registrant and as Chief
                                                  Financial Officer

                                       11