<PAGE>

                                   FORM 10-QSB

                       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 Quarter ended March 31, 2001

                         COMMISSION FILE NUMBER: 0-9562

                            COLONIAL INDUSTRIES, INC.

                          formerly IMPACT ENERGY, INC.

Texas                                                                84-0818655
(Jurisdiction of Incorporation)             (I.R.S. Employer Identification No.)

PO Box 980459, Houston Texas                                          77098-0459
(Address of principal executive offices)                              (Zip Code)


Registrant's telephone number, including area code:           (713) 592-8002


Securities registered pursuant to Section 12(b) of the Act:   None


Securities registered pursuant to Section 12(g) of the Act:   None

Yes [ ] No [x] (Indicate by check mark whether the Registrant (1) has filed all
report required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports) and (2) has been subject to such
filing requirements for the past 90 days.)

As of March 31, 2001, the number of shares outstanding of the Registrant's
Common Stock was 6,802,434.


<PAGE>

                        PART I: FINANCIAL INFORMATION

                         ITEM 1. FINANCIAL STATEMENTS

    Attached hereto and incorporated herein by this reference are the following
financial statements:


================================================================================
Exhibit  FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
01QF-2   UN-AUDITED FINANCIAL STATEMENTS for the three months ended
         March 31, 2001
================================================================================


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

 (A) PLAN OF OPERATION. The Company is a candidate for a business combination,
joint venture, or structured acquisition, which, if effective, would create
profitability for the Company and its shareholders. There are no present plans
to pursue any acquisition at this time.

 (B) RESULTS OF OPERATIONS. We have no current business, and have had no
operations in the last two fiscal years. Its recorded "operating expenses" of
$5,209 consist of corporate maintenance expenses, legal, professional,
certificate and transfer agency, accounting, auditing and interest. The Issuer
has no assets or revenue

 (C) LIQUIDITY AND CAPITAL RESOURCES. The Issuer has no present capital resource
and accordingly no liquidity. It has accrued liabilities of $106,610, of which
$54,009 is principal and $52,601 is interest. This Issuer has no business or
productive assets and remains essentially dormant, its activities limited to
maintaining its corporate franchise in Texas, and making required periodic
filings and disclosures.

                          PART II: OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS None

ITEM 2.  CHANGE IN SECURITIES. None

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES. None

ITEM 4.  SUBMISSION OF MATTERS TO VOTE OF SECURITY HOLDERS. None

ITEM 5.  OTHER INFORMATION. None

ITEM 6. REPORTS ON FORM 8-K. None

                                   EXHIBITS

================================================================================
Exhibit  FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
01QF-2   UN-AUDITED FINANCIAL STATEMENTS for the three months ended
         March 31, 2001
================================================================================

<PAGE>

                                   SIGNATURES


Pursuant to the requirements of the Securities Exchange Act of 1934, this Form
10-QSB Report for the Quarter ended March 31, 2001, has been signed below by the
following person on behalf of the Registrant and in the capacity and on the date
indicated.


March 31, 2001


                          COLONIAL INDUSTRIES, INC.

                         formerly IMPACT ENERGY, INC.



                                      by



/s/                                                                        /s/
Joe Kane                                                            Jack Wells
PRESIDENT/DIRECTOR
SECRETARY/TREASURER

<PAGE>



                                EXHIBIT 00QF-3

                       UN-AUDITED FINANCIAL STATEMENTS

                          FOR THE THREE MONTHS ENDED

                                MARCH 31, 2001



<PAGE>

                            COLONIAL INDUSTRIES, INC.
                          (a Development Stage Company)
                           CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>

                                                                        March 31,         December 31,
                                                                          2001               2000
                                                                        ---------        -------------
                                                                       (Unaudited)
<S>                                                                     <C>                <C>
                           ASSETS

CURRENT ASSETS

        Cash                                                            $     -0-          $     -0-
                                                                        ---------          ---------

TOTAL CURRENT ASSETS                                                          -0-                -0-
                                                                        ---------          ---------

TOTAL ASSETS                                                            $     -0-          $     -0-
                                                                        =========          =========



             LIABILITIES & STOCKHOLDERS' EQUITY

CURRENT LIABILITIES

    Accounts payable                                                    $  50,943          $  50,430
    Accounts payable - related party                                        2,040              2,040
    Accrued interest                                                       50,154             48,931
                                                                        ---------          ---------
        Total Current Liabilities                                         103,137            101,401
                                                                        ---------          ---------

STOCKHOLDERS' EQUITY

    Common Stock, no par value; authorized 75,000,000
       shares of no par value, issued and outstanding;
       6,802,434 and 6,802,434 shares respectively
    Additional paid-in Capital (Discount on stock)                        (48,932)           (48,932)

    Accumulated Surplus (Deficit)                                         (54,205)           (52,469)
                                                                        ---------          ---------

Total Stockholders' Equity                                               (103,137)          (101,401)
                                                                        ---------          ---------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                              $       0          $     -0-
                                                                        =========          =========
</TABLE>

                   The accompanying notes are an integral part
                         of these financial statements.



                                    page F-1

<PAGE>
                            COLONIAL INDUSTRIES, INC.
                          (a Development Stage Company)
                CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

<TABLE>
<CAPTION>
                                                                                          Inception
                                                           For the periods                (January 1,
                                                           ended March 31,                1990) thru
                                                   ------------------------------           March 31,
                                                       2001               2000               2001
                                                   ------------------------------        ------------
<S>                                                <C>                <C>                <C>
Revenues                                           $       -0-        $       -0-        $       -0-
                                                   -----------        -----------        -----------

Expenses

  General & administrative                                 513                723              4,051
                                                   -----------        -----------        -----------

Total Operating Expenses                                   513                723              4,051
                                                   -----------        -----------        -----------

Net Operating Loss                                        (513)              (723)            (4,051)

Other Income (Expense)

  Interest expense                                      (1,223)            (1,223)           (50,154)
                                                   -----------        -----------        -----------

    Total Other Income (Expense)                        (1,223)            (1,223)           (50,154)
                                                   -----------        -----------        -----------

Net Income (Loss)                                  $    (1,736)       $    (1,946)       $   (54,205)
                                                   ===========        ===========        ===========

Net Income (Loss) per Share                        $     (0.00)       $     (0.00)       $     (0.03)
                                                   ===========        ===========        ===========

Weighted Average
    Shares Outstanding                               6,802,434          6,802,434          2,157,235
                                                   ===========        ===========        ===========

</TABLE>


                      Theaccompanying notes are an integral
                       part of these financial statements.


                                    page F-2

<PAGE>
                            COLONIAL INDUSTRIES, INC.
                          (a Development Stage Company)
                CONSOLIDATED STATEMENTS OF CASH FLOW (Unaudited)

<TABLE>
<CAPTION>

                                                                                             From inception on
                                                                   For the periods            January 1, 1990
                                                                   ended March 31,                through
                                                              --------------------------          March 31,
                                                                2001              2000              2001
                                                              --------          --------     ------------------
<S>                                                           <C>               <C>              <C>
CASH FLOWS FROM OPERATING ACTIVITIES

  Net Income (Loss)                                           $ (1,736)         $ (1,946)        $(54,205)
  Adjustments to reconcile net loss to
    net cash provided by operations
    Accounts payable & accruals                                 31,736             1,946           54,205
                                                              --------          --------         --------

Net cash flows from operating activities                             0                 0                0
                                                              --------          --------         --------

CASH FLOWS FROM INVESTING ACTIVITIES                                 0                 0                0
                                                              --------          --------         --------

CASH FLOWS FROM FINANCING ACTIVITIES                                 0                 0                0
                                                              --------          --------         --------
                                                                     0                 0                0
NET INCREASE IN CASH

CASH AT BEGINNING OF PERIOD                                        -0-               -0-              -0-
                                                              --------          --------         --------

CASH AT END OF PERIOD                                         $    -0-          $    -0-         $    -0-
                                                              ========          ========         ========


Supplemental Cash Flow Information
  Cash Paid for:
    Interest                                                  $      0          $      0         $      0
    Taxes                                                     $      0          $      0         $      0

</TABLE>


                     The accompanying notes are an integral
                       part of these financial statements.



                                    page F-4


<PAGE>
                            COLONIAL INDUSTRIES, INC.
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                                 March 31, 2001



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

      Colonial Industries, Inc. ("the Company") has elected to omit
      substantially all footnotes to the financial statements for the period
      ended March 31, 2001, since there have been no material changes (other
      than indicated in other footnotes) to the information previously reported
      by the Company in their Annual Report filed on Form 10-KSB for the Fiscal
      year ended December 31, 2000.

UNAUDITED INFORMATION

      The information furnished herein was taken from the books and records of
      the Company without audit. However, such information reflects all
      adjustments which are, in the opinion of management, necessary to properly
      reflect the results of the period presented. The information presented is
      not necessarily indicative of the results from operations expected for the
      full fiscal year.