U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

(Mark One)

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

For the quarterly period ended June 30, 1999

|_|   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 0-24798

                           COLECCIONES DE RAQUEL, INC.
--------------------------------------------------------------------------------
        (Exact name of small business issuer as specified in its charter)

           Nevada                                             93-1123005
--------------------------------------------------------------------------------
(State or other jurisdiction                              (IRS Employer
of Incorporation)                                         Identification Number)

           9873 S. Santa Monica Blvd., Beverly Hills, California 90212
     ---------------------------------------------------------------------
                    (Address of principal executive offices)

                                 (310) 203-9240
                        -------------------------------
                           (Issuer's telephone number)

--------------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since last
report)

      Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act of 1934 during the past 12 months (or
for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days.

                                            Yes |X| No |_|

At June 30, 1999, 27,300,000 shares of the Company's $.0001 par value common
stock were outstanding.

<PAGE>

PART 1 - FINANCIAL INFORMATION

ITEM 1. Financial Statements

                                                                           PAGE
                                                                           ----

      (a)   Balance Sheet (Unaudited) -June 30, 1999 .........................1

      (b)   Statements of Operations (Unaudited) - Six months
            ended June 30, 1999 and 1998 Period from
            Inception (December 1, 1987) to June 30, 1999.....................2

      (c)   Statements of Operations (Unaudited) -Second Quarter
            ended June 30, 1999 and 1998 and Prior 1999 First Quarter.........3

      (d)   Statement of Stockholder's Equity (Unaudited)
            Period from Inception (December 1, 1987) to June 30, 1999.........4

      (e)   Statements of Cash Flows (Unaudited) - Six months
            ended June 30, 1999 and Period from
            Inception (December 1, 1987) to June 30, 1999.....................5

      (f)   Notes to Unaudited Financial Statements...........................6

ITEM 2. Management's Discussion and Analysis or
        Plan of Operation.....................................................8

PART II - OTHER INFORMATION...................................................9


                                       ii
<PAGE>

                           Colecciones de Raquel, Inc.
                          (A Development Stage Company)
                                  Balance Sheet
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                       June 30, 1999
                                                                       -------------
<S>                                                                       <C>
Assets

   Current Assets

         Cash and equivalents                                             $  159,195
         Merchandise Inventory                                                67,893
         Deposits paid and other assets                                        4,067
                                                                          ----------

         Total Current Assets                                             $  231,155

   Equipment, Furniture & Fixtures, net of accum. depr. $32,628               15,093
                                                                          ----------

   Total Assets                                                           $  246,248
                                                                          ==========

Liabilities and Stockholders Equity

   Current Liabilities
         Accounts payable                                                 $      331
         Taxes payable                                                             6
                                                                          ----------

         Total current liabilities                                        $      337

   Stockholder's equity
         Common stock - $.0001 par value, 50,000,000 shares authorized,
         27,300,000 shares issued and outstanding                              2,730

         Additional paid in capital                                        1,375,444

         Deficit accumulated during the development stage                 (1,132,262)
                                                                          ----------

         Total stockholder's equity                                          246,248
                                                                          ----------

   Total liabilities and stockholder's equity                             $  246,248
                                                                          ==========
</TABLE>


                 See accompanying notes to financial statements               1
<PAGE>

                           Colecciones de Raquel, Inc.
                          (A Development Stage Company)
                            Statements of Operations
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                             Six Months          First Quarter
                                                             Ended June             March 31,

                                                        1999            1998            1999
                                                        ----            ----            ----
<S>                                                    <C>             <C>             <C>
Sales                                                  3,879           5,292           1,804
Cost of Goods Sold                                     1,125           2,772             228
                                                  ----------      ----------      ----------

Gross Profit                                           2,754           2,520           1,576

Selling, general, and administrative expenses        101,962         132,342          46,294
                                                  ----------      ----------      ----------

(Loss) from operations                               (99,208)       (129,822)        (44,294)

Interest Income                                        4,454           9,978           2,471

Loss before provision for income taxes               (94,754)       (119,844)        (42,247)

Provision for income taxes

Net Loss                                            ($94,754)      ($119,844)       ($42,247)
                                                  ==========      ==========      ==========

Net Loss per share                                     ($.01)          ($.01)        ($.0015)
                                                  ==========      ==========      ==========

Weighted average number of common shares          27,300,000      27,300,000      27,300,000
                                                  ==========      ==========      ==========
</TABLE>


                 See accompanying notes to financial statements               2
<PAGE>

                           Colecciones de Raquel, Inc.
                          (A Development Stage Company)
                            Statements of Operations
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                              Period from Inception
                                                            Three Months         Dec. 1, 1987 to
                                                            Ended June 30,          June 30,

                                                        1999           1998            1999
                                                        ----           ----            ----
<S>                                                      <C>           <C>            <C>
Sales                                                  2,437           3,092          35,940
Cost of Goods Sold                                       925           1,601          14,568
                                                  ----------      ----------      ----------

Gross Profit                                           1,511           1,491          21,372

Selling, general, and administrative expenses         55,668          75,246       1,257,542
                                                  ----------      ----------      ----------

(Loss) from operations                               (54,157)        (73,755)     (1,236,170)

Interest Income                                        1,984           4,627          86,090

Loss before provision for income taxes               (52,173)        (69,128)     (1,127,119)

Provision for income taxes

Net Loss                                            ($52,173)       ($69,128)     (1,131,119)
                                                  ==========      ==========      ==========

Net Loss per share                                    ($.002)         ($.003)          ($.04)
                                                  ==========      ==========      ==========

Weighted average number of common shares          27,300,000      27,300,000      27,300,000
                                                  ==========      ==========      ==========
</TABLE>


                 See accompanying notes to financial statements               3
<PAGE>

                           COLECCIONES DE RAQUEL, INC.
                         (A Developement Stage Company)
                        Statement of Stockholders' Equity
        For the Period from December 1, 1987 (inception) to June 30, 1999
                                   (Unaudited)

<TABLE>
<CAPTION>
                                    Preferred Stock                  Common Stock
                                    ---------------                  ------------
                                                                                             Additional        MMI
                                 Number                        Number                         Paid-In       Settlement
                               of Shares       Amount        of Shares         Amount         Capital        Agreement
                               ---------       ------        ---------         ------         -------        ---------
<S>                              <C>       <C>               <C>           <C>              <C>            <C>
Net loss for the
 inception through
 December 31, 1992                    --   $         --              --    $         --    $         --    $         --
Net Loss, 1993                        --             --              --              --              --              --
                                --------   ------------      ----------    ------------    ------------    ------------

Balance, Dec. 31, 1993                --             --              --              --              --              --
 Common Stock Issued
  In reorganization                   --             --      20,000,000           2,000          34,754              --
Common Stock Issued in IPO            --             --       1,000,000             100          90,990              --
Preferred Stock exchanged for
 Common Stock per IPO            100,000            100     (20,000,000)         (2,000)          1,900              --
Exercise of A Warrants                --             --       1,000,000             100         249,900              --
MMI Settlement Agreement              --             --              --              --              --        (250,000)
Net Loss                              --             --              --              --              --              --
                                --------   ------------      ----------    ------------    ------------    ------------

Balance, Dec. 31, 1994           100,000            100       2,000,000             200         377,544        (250,000)
Exercise of B Warrants                --             --       2,000,000             200         999,800              --
MMI settelement agreement             --             --              --              --              --      (1,000,000)
Cash received from MMI                --             --              --              --              --         849,875
Net loss                              --             --              --              --              --              --
                                --------   ------------      ----------    ------------    ------------    ------------

Balance, Dec. 31, 1995           100,000            100       4,000,000             400       1,377,344        (400,125))
Cash received from MMI                --             --              --              --              --         400,125
Common Stock exchanged
  for Preferred Stock           (100,000)          (100)     20,000,000           2,000          (1,900)
Net Loss                              --             --              --              --              --              --
                                --------   ------------      ----------    ------------    ------------    ------------

Balance Dec 31, 1996                  --             --      24,000,000    $      2,400    $  1,375,444    $         --
Net Loss                              --             --                                                              --

Balance Dec. 31, 1997                 --             --      24,000,000    $      2,400    $  1,375,444

Common stock issued for                    $                  3,300,000             330    $  1,375,444    $         --
  consulting services
Net Loss                                   $
                                --------   ------------      ----------    ------------    ------------    ------------
Balance Dec 31, 1998                       $                 27,300,000           2,730       1,375,444

Net Loss
Balance June, 1999                         $                 27,300,000    $      2,730    $  1,375,444    $         --
                                           ============      ==========    ============    ============    ============

<CAPTION>
                                    Deficit
                                   During the         Total
                                   Development     Shareholder's
                                      Stage           Equity
                                      -----           ------
<S>                              <C>             <C>
Net loss for the
 inception through
 December 31, 1992               ($    29,178)   ($    29,178)
Net Loss, 1993                         (7,462)         (7,462)
                                 ------------    ------------

Balance, Dec. 31, 1993                (36,640)        (36,640)
 Common Stock Issued
  In reorganization                        --          36,754
Common Stock Issued in IPO                 --          91,090
Preferred Stock exchanged for
 Common Stock per IPO                      --              --
Exercise of A Warrants                     --         250,000
MMI Settlement Agreement                   --        (250,000)
Net Loss                              (58,052)        (58,052)
                                 ------------    ------------

Balance, Dec. 31, 1994                (94,692)         33,152
Exercise of B Warrants                     --       1,000,000
MMI settelement agreement                  --      (1,000,000
Cash received from MMI                     --         849,875
Net loss                             (126,518)       (126,518)
                                 ------------    ------------

Balance, Dec. 31, 1995               (221,210)        756,509
Cash received from MMI                     --         400,125
Common Stock exchanged
  for Preferred Stock
Net Loss                             (308,137)       (308,137)
                                 ------------    ------------

Balance Dec 31, 1996             ($   529,347)   $    848,497
Net Loss                         ($   290,579)   ($   290,579)
                                 ------------    ------------

Balance Dec. 31, 1997                (819,926)        557,918

Common stock issued for          $         --    $        330
  consulting services
Net Loss                             (217,582)       (217,582)
                                 ------------    ------------
Balance Dec 31, 1998               (1,037,508)        340,666

Net Loss                              (94,754)
Balance June, 1999               ($ 1,079,755)   $    246,248
                                 ============    ============
</TABLE>


4                 See accompanying notes to financial statements
<PAGE>

                           Colecciones de Raquel, Inc.
                          (A Development Stage Company)
                            Statements of Cash Flows
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                     For the Six Month    Period from Inception
                                                          Period Ended     December 31, 1987
                                                              June 30,        to Current
                                                                  1999       June 30, 1999
                                                        --------------       -------------
<S>                                                        <C>                <C>
Cash flows from operating activities
Net loss                                                   $   (94,754)      $(1,132,262)
Adjustments to reconcile net loss to net cash used in
 operating activities
           Depreciation                                          4,743            32,627
       (Increase) decrease in
           Inventory                                               699           (67,892)
           Prepaid expenses & other assets                      (2,920)           (1,868)
           Deposits                                                  0            (2,200)
        Increase (decrease) in
           Accounts Payable & accrued expenses                  (4,066)              337
                                                           -----------       -----------
           Net cash used in operating activities           $   (90,958)      $(1,171,258)
                                                           -----------       -----------


Cash flows from investing activities
           Purchase of Equipment & Improvements                     (0)          (47,721)

           Net cash used in investing activities                    (0)      $   (47,721)
                                                                             -----------

Cash flows from financing activities
       Proceeds from MMI settlement agreement                       --       $ 1,250,000
       Proceeds from sale of common stock                           --            91,090
       Payments for offering costs                                  --
Loans & paid-in capital from preferred stockholder                  --            36,754
                                                           -----------       -----------

       Net cash provided by financing activities                    --       $ 1,377,844
                                                           -----------       -----------

       Net increase(decrease) in cash and cash             ($   90,458)      $   159,195
           equivalents                                     -----------       ===========
Cash & cash equivalents, beginning of period               $   249,653

Cash & cash equivalents, end of period                     $   159,195
                                                           ===========

Interest received                                          $     4,454
                                                           ===========

Taxes paid                                                 $     1,311
                                                           ===========
</TABLE>


                                                                               5
<PAGE>

                           Colecciones de Raquel, Inc.
                          (A Development Stage Company)
                          Notes to Financial Statements
                                   (Unaudited)

1. Business

      Colecciones de Raquel, Inc. (The "Company") designs and markets cosmetics,
      skin care, fragrance, and lingerie. The Company's cosmetics line is
      specifically designed for golden skin tones such as sallow and olive
      complexions.

2. Unaudited financial statements

      The financial statements as of June 30, 1999 and June, 1998 included
      herein are unaudited; however, such information reflects all adjustments
      consisting of normal recurring adjustments, which are, in the opinion of
      management, necessary for a fair presentation of the information for such
      periods. In addition, the results of operation for the interim periods are
      not necessarily indicative of results for the entire year. The
      accompanying financial statements should be read in conjunction with the
      Company's annual report filed on Form 10-KSB.

3. Warrants and related settlement agreement

      In August 1994, the Company completed an initial public offering of its
      securities. The Company sold 1,000,000 units at $.10 per unit for gross
      proceeds of $100,000 on a self-underwritten basis. Expenses of the
      offering were $8,910. Each unit consists of one share of common stock and
      one Class A Warrant. The Class A Warrants were exercisable for one share
      of common stock and two Class B Warrants at a price of $.25 each. The
      Class B Warrants were exercisable for one share of common stock and one
      Class C Warrant at a price of $.50 each. The Class C warrants were to be
      exercisable for one share of common stock at a price of $1.00 each.

      In February 1995, all of the B Warrants were exercised in a transaction
      which the Company claims was fraudulent. Although the Company received no
      portion of the $250,000 exercise price, Units consisting of one share of
      common stock and two B Warrants were issued by the Company's transfer
      agent without the knowledge of the Company's officers or directors to
      persons purportedly exercising the A Warrants.

      In February 1995, all of the B Warrants were exercised in a transaction
      which the Company claims was fraudulent. Although the Company received no
      portion of the $1,000,000 exercise price, Units consisting of one share of
      common stock and one C warrant were issued by the Company's transfer agent
      without the knowledge of the Company's officers or directors to persons
      purportedly exercising the B Warrants.

      The shares of common stock issued in the Company's initial public offering
      and upon exercise of the A Warrants and B Warrants (collectively,
      "Shares") have been publicly traded. The C Warrants were also purportedly
      exercised without the receipt by the Company of the exercise price, the
      Company believes that the shares issued upon exercise of the C Warrants
      were not traded and the Company has canceled the C Warrants and the shares
      issued upon their exercise.

      In September 1995, the Company entered into an Agreement with Moore
      McKenzie, Inc., a Philippine corporation ("MMI"), which purchased and
      resold the shares following their exercise by third party entities. MMI
      has expressly denied any involvement in the exercise of the A Warrants, B
      Warrants, and C Warrants. Solely for the purpose of protecting and
      preserving its investment in the Shares and its reputation and goodwill,
      MMI agreed to pay the Company the exercise price of the A Warrants


                                                                               6
<PAGE>

      ($250,000) and B Warrants ($1,000,000). As of February 29, 1996, the
      Company had received all of the settlement

3. Warrants and related settlement agreement (continued)

      Further, the Company agreed to sell MMI an additional 1,000,000 shares of
      common stock at a price of $1.00 per share in place of the shares which
      could have been purchased upon exercise of the canceled C Warrants. The
      option to purchase the additional 1,000,000 shares at $1.00 per share
      expired in September, 1996. MMI did not purchase the additional 1,000,000
      and no additional shares were issued. As part of the Agreement with MMI,
      the Company agreed to assist and cooperate with MMI in any action against
      third parties to recover MMI's damages suffered as a result of or in
      connection with MMI's purchase of the Shares.

4. Legal proceedings

      In September of 1998, the Company filed a complaint and Demand for
      Arbitration before the American Arbitration Association against John W.
      Vanover. The Demand for Arbitration is for the return of $10,000 in cash
      and stock certificates for 2.6 million Company common shares. The basis of
      the dispute is for non-performance, bad faith, and willful malfeasance.

      An Arbitration hearing was held on July 16, 1999, before the American
      Arbitration Association in regard to the Company's claims against John W.
      Vanover. On August 5, 1999 the Company received notice that the Company
      had been awarded its demands in the Complaint. The 2.6 million shares
      (certificate nos.8754, 8755, 8756, 8757, 8758, 8759, 8760, 8761, 8762,
      8763, 8764, 8765, and 8766) which were issued to John W. Vanover have been
      canceled.

      Currently, there are no material pending legal proceedings to which the
      Company or the property of the Company are subject. In addition, no
      proceedings are known to be contemplated by a governmental authority
      against the Company or any officer or director of the Company.

5. Leases

      On October 1, 1995, the Company entered into a two year lease for a store
      front located in Beverly Hills, California. In October, 1997 this lease
      was renewed for another 2 years. The space is approximately 700 square
      feet, and the monthly rent is $1,100. In May 1996, the Company entered
      into a three year lease for a 900 square foot store front in downtown Los
      Angeles, California. Monthly rent for the space, which the Company is
      utilizing for its second showroom/boutique location, is $1,451 per month.
      This lease expired on June 30, 1999, and the store has been closed.


                                                                               7
<PAGE>

ITEM 2. Management's Discussion And Analysis Or Plan Of Operation

      Material Changes in Results of Operations

      Although 1999 Second Quarter revenues were lower than those of 1998, Cost
      of Goods Sold were lower due to a decrease in lingerie sales which have a
      lower profit margin. Selling, general, and administrative expenses for the
      1999 Second Quarter year-to-date period were 27% lower than 1998's Second
      Quarter year-to-date.

      Material Changes in Financial Condition

      During the six month period ended June 30, 1999 the Company's cash
      position decreased due to the continued low level of sales relative to its
      cost of operations, and lack of offsetting inflows from financing
      activities. Inventory levels were lower from year-end 1997 due to sales.

      The Company's available cash at June 30, 1999 is expected to be sufficient
      to defray the Company's operating expenses through calendar year 1999. The
      Company's continued existence will be dependent on its ability to generate
      significant product sales and ultimately to achieve profitable operations.


                                                                               8
<PAGE>

                           PART II - OTHER INFORMATION

Item 1. Legal Proceedings

      In September of 1998, the Company filed a complaint and Demand for
      Arbitration before the American Arbitration Association against John W.
      Vanover. The Demand for Arbitration is for the return of $10,000 in cash
      and stock certificates for 2.6 million Company common shares. The basis of
      the dispute is for non-performance, bad faith, and willful malfeasance.
      Other than this item, there are no material pending legal proceedings to
      which the Company or the property of the Company are subject.

      An Arbitration hearing was held on July 16, 1999, before the American
      Arbitration Association in regard to the Company's claims against John W.
      Vanover. On August 5, 1999 the Company received notice that the Company
      had been awarded its demands in the Complaint: 2.6 million shares.,
      $10,000, costs of filing said complaint and interest accruing from March
      16, 1999. The 2.6 million shares (certificate nos. 8754, 8755, 8756, 8757,
      8758, 8759, 8760, 8761, 8762, 8763, 8764, 8765, and 8766) which were
      issued to John W. Vanover have been canceled.

      Currently, there are no material pending legal proceedings to which the
      Company or the property of the Company are subject. In addition, no
      proceedings are known to be contemplated by a governmental authority
      against the Company or any officer or director of the Company.

Item 2. Changes in Securities

      In June 1998, the Company issued 3,300,000 shares of common stock in
      exchange for consulting services to be performed by two consultants. Both
      consultants' contracts and services were terminated in 1998 and the
      Company placed a stop order on the above shares. (See Item 1 above.)
      Further, in April 1999, one consultant agreed to return 700,000 shares of
      common stock issued in exchange for consulting services for $4,000 in
      cash.

      In June, 1999, the Company entered into an agreement with Angela Z. Hardy
      and Corporate Image Builders for investor relations services. Per this new
      agreement, the Company has released the shares which were initially issued
      to Angela Zucchini, aka, Angela Z. Hardy in June of 1998, for payment of
      these services.

      On July 16, 1999, an arbitration was held regarding the 2.6 million shares
      issued to John W. Vanover . A Notice of Award was received by the Company
      on August 5, 1999, granting its claims against Vanover. As a result,
      certificate nos. 8754, 8755, 8756, 8757, 8758, 8759, 8760, 8761, 8762,
      8763, 8764, 8765, and 8766, totaling 2.6 million shares have been
      canceled. As such, the total amount of outstanding shares is 24,700,000,
      which will be reflected in next quarter's financials.

Item 3. Defaults Upon Senior Securities

      Inapplicable.

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

      Inapplicable.


                                                                               9
<PAGE>

Item 5. Other Information

      On June 2, 1999 the Company stock commenced trading on the NASD Bulletin
      Board under its symbol, "CRQL."

      In June, 1999, the Company entered into an investor relations agreement
      with Corporate Image Builders.

Item 6. Exhibits and Reports on Form 8K

      (a)   Exhibits

            Inapplicable.

      (b)   Reports on Form 8-K

            No reports on Form 8-K were filed during the period covered by this
            report.

                                   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.

                                      COLECCIONES DE RAQUEL, INC.
                                      (Registrant)


Dated: August 6, 1999                By: /s/ Raquel Zepeda
                                        ----------------------------------------
                                        Raquel Zepeda, Chief Financial Officer


                                                                              10