<PAGE>   1

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

(Mark One)

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

         For the quarterly period ended       OCTOBER 31, 1998
                                        -----------------------------

                                       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  0-12226
                                               -----------


                       CALIFORNIA BEACH RESTAURANTS, INC.
             ------------------------------------------------------
             (Exact name of Registrant as specified in its charter)



          CALIFORNIA                                    95-2693503
-------------------------------                     ----------------------
(State or other jurisdiction of                        (IRS Employer
 incorporation or organization)                     Identification Number)
                                                    

         17383 SUNSET BOULEVARD, SUITE 140, PACIFIC PALISADES, CA 90272
         --------------------------------------------------------------
              (Address and zip code of Principal executive offices)

                                 (310) 459-9676
              ----------------------------------------------------
              (Registrant's telephone number, including area code)


Indicate by check mark 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 period that the registrant was
required to file such reports) and (2) has been subject to the filing
requirements for at least 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:

                                                Number of Shares Outstanding
          Class                                     at December 11, 1998
----------------------------                    ----------------------------
Common Stock, $.01 par value                              3,400,931




<PAGE>   2

               CALIFORNIA BEACH RESTAURANTS, INC. AND SUBSIDIARIES

                                OCTOBER 31, 1998


                                      INDEX





<TABLE>
<CAPTION>

Part I - FINANCIAL INFORMATION                                                          Page Number
                                                                                        -----------
<S>      <C>                                                                           <C>  

         Item 1.    FINANCIAL STATEMENTS (UNAUDITED)

                    Consolidated Balance Sheets at October 31, 1998
                    and April 30, 1998..........................................................3

                    Consolidated Statements of Operations for the
                    Three Months Ended and Six Months Ended
                    October 31, 1998 and 1997...................................................5

                    Consolidated Statements of Cash Flows for the
                    Six Months Ended October 31, 1998 and 1997..................................6

                    Notes to Consolidated Financial Statements..................................7

         Item 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                    CONDITION AND RESULTS OF OPERATIONS.........................................9

         Item 3.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.................13


Part II - OTHER INFORMATION

         Item 1.    LEGAL PROCEEDINGS..........................................................13

         Item 2.    CHANGES IN SECURITIES AND USE OF PROCEEDS..................................13

         Item 3.    DEFAULTS UPON SENIOR SECURITIES............................................13

         Item 4.    SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS........................13

         Item 5.    OTHER INFORMATION..........................................................13

         Item 6.    EXHIBITS AND REPORTS ON FORM 8-K...........................................13


         Signature Page........................................................................14

</TABLE>


                                       2
<PAGE>   3



               CALIFORNIA BEACH RESTAURANTS, INC. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS

                                     ASSETS






<TABLE>
<CAPTION>


                                                                     October 31, 1998          April 30, 1998
                                                                     ----------------          --------------
                                                                        (Unaudited)                  (1)
<S>                                                                  <C>                       <C>   

Current Assets:

     Cash                                                                  $ 227,000              $  252,000
     Trade and other receivables                                              45,000                  39,000
     Inventories                                                             150,000                 162,000
     Prepaid expenses                                                        212,000                 321,000
                                                                           ---------               ---------

       Total current assets                                                  634,000                 774,000


Fixed Assets (at cost) - net of accumulated
     depreciation and amortization (Note C )                               1,014,000                 946,000


Other Assets:

     Goodwill, net of accumulated amortization
     of $4,913,000 at October 31, 1998 and
     $4,584,000 at April 30, 1998                                          1,098,000               1,427,000


     Other                                                                   174,000                 174,000
                                                                            --------                --------


                                                                          $2,920,000              $3,321,000
                                                                           =========              ==========

</TABLE>



The accompanying notes to consolidated financial statements are an integral part
of this statement.


(1)    The April 30, 1998 amounts have been extracted from the Company's Annual
       Report on Form 10-K for the year ended April 30, 1998.




                                       3
<PAGE>   4


              CALIFORNIA BEACH RESTAURANTS, INC. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS

                      LIABILITIES AND STOCKHOLDERS' EQUITY





<TABLE>
<CAPTION>




                                                                     October 31, 1998          April 30, 1998
                                                                     ----------------          --------------
                                                                         (Unaudited)                 (1)
<S>                                                                  <C>                       <C>  

Current Liabilities:

     Accounts payable                                                     $   494,000               $  568,000
     Accrued liabilities                                                      620,000                  895,000
     Revolving line of credit (Note D)                                        500,000                  700,000
                                                                          -----------              -----------

       Total current liabilities                                            1,614,000                2,163,000

Deferred rent                                                                 197,000                  207,000
Other liabilities                                                             171,000                  167,000


Stockholders' Equity:

     Common stock, $.01 par value, authorized 25,000,000 shares, issued and
     outstanding, 3,401,000 shares at October 31, 1998 and
     at April 30, 1998                                                         34,000                   34,000


     Additional paid-in capital                                            13,175,000               13,175,000

     Deficit in retained earnings                                         (12,271,000)             (12,425,000)
                                                                          -----------               ----------

       Total stockholders' equity                                             938,000                  784,000
                                                                          -----------               ----------

                                                                          $ 2,920,000               $3,321,000
                                                                          ===========               ==========
</TABLE>

The accompanying notes to consolidated financial statements are an integral part
of this statement.


(1)    The April 30, 1998 amounts have been extracted from the Company's Annual
       Report on Form 10-K for the year ended April 30, 1998.




                                       4
<PAGE>   5



               CALIFORNIA BEACH RESTAURANTS, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF OPERATIONS

                                   (UNAUDITED)


<TABLE>
<CAPTION>

                                                      Three Months Ended                 Six Months Ended
                                                          October 31,                         October 31,
                                                   ----------------------            ---------------------
                                                   1998              1997            1998             1997
                                                   ----              ----            ----             ----
<S>                                                <C>             <C>               <C>             <C>   

Sales                                             $3,584,000       $3,798,000        $7,138,000      $7,798,000

Costs and expenses:

     Cost of goods sold                            2,968,000        3,010,000         5,905,000       6,192,000
     Selling, general and administrative             211,000          658,000           423,000         872,000
     Legal and litigation settlement                  34,000          276,000            50,000         361,000
     Depreciation                                     63,000           69,000           124,000         138,000
                                                   ---------        ---------         ---------       ---------
Operating  income (loss)                             308,000         (215,000)          636,000         235,000

Other income (expenses):

     Interest expense -                              (67,000)               -          (144,000)         (1,000)
     Amortization of intangible assets              (168,000)        (166,000)         (329,000)       (332,000)
     Other, net                                            -            9,000                 -          17,000
                                                   ---------        ---------        ----------       ---------

Income (loss) before income taxes                     73,000         (372,000)          163,000         (81,000)
Provision for income taxes                             4,000                -             9,000           7,000
                                                   ---------        ---------        ----------      ----------

Net  income (loss)                                   $69,000        ($372,000)         $154,000        ($88,000)
                                                   =========        =========          ========        ========



Net income (loss) per
 common share (basic and diluted):                    $  .02           ($ .11)            $ .05          ($ .03)
                                                      ======        ==========            =====        ========



Weighted average number of
 common shares outstanding:                        3,401,000         3,401,000        3,401,000       3,401,000
                                                   =========         =========        =========       =========
</TABLE>






The accompanying notes to consolidated financial statements are an integral part
of this statement.

                                       5
<PAGE>   6



               CALIFORNIA BEACH RESTAURANTS, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                        SIX MONTHS ENDED OCTOBER 31, 1998

                                   (UNAUDITED)

<TABLE>
<CAPTION>


                                                                       1998                      1997
                                                                       ----                      ----
<S>                                                                    <C>                       <C>    
Cash flows from operating activities:

Net income (loss)                                                       $154,000                  ($88,000)

Adjustments to reconcile net income (loss) to cash provided by operations:

     Depreciation and amortization                                       453,000                   470,000

Changes in operating assets and liabilities:

     Restricted cash                                                           -                   475,000
     Trade and other receivables                                          (6,000)                    3,000
     Inventories                                                          12,000                    (2,000)
     Prepaid expenses                                                    109,000                    18,000
     Accounts payable                                                    (74,000)                  104,000
     Accrued liabilities                                                (275,000)                  105,000
     Deferred rent                                                       (10,000)                        -
     Other liabilities                                                     4,000                   273,000
                                                                       ---------                ----------

Cash provided by operations                                              367,000                 1,358,000
                                                                       ---------                ----------

Investing activities:
     Additions to fixed assets                                          (192,000)                 (103,000)
                                                                       ---------                ----------

Net cash used in investing activities                                   (192,000)                 (103,000)
                                                                       ---------                ----------

Financing activities:

     Principal payments on borrowings                                   (200,000)               (1,488,000)
                                                                       ---------                ----------

Net cash used in financing activities                                   (200,000)               (1,488,000)
                                                                       ---------                ----------

Net decrease in cash                                                     (25,000)                 (233,000)
Cash at beginning of period                                              252,000                   626,000
                                                                       ---------                ----------

Cash at end of period                                                  $ 227,000                  $393,000
                                                                       =========                  ========

Supplemental disclosures of cash flow information:

Cash paid during the period for:

     Interest                                                          $ 144,000                     1,000
                                                                       =========                ==========
     Income taxes                                                      $       -                $   12,000
                                                                       =========                ==========
</TABLE>

The accompanying notes to consolidated financial statements are an integral part
of this statement

                                       6
<PAGE>   7



               CALIFORNIA BEACH RESTAURANTS, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                   (UNAUDITED)


NOTE A - BASIS OF PRESENTATION

The unaudited consolidated financial statements presented herein include the
accounts of California Beach Restaurants, Inc., and its wholly-owned
subsidiaries (the "Company"). All significant intercompany accounts and
transactions have been eliminated.

The unaudited consolidated financial statements presented herein have been
prepared in accordance with generally accepted accounting principles and the
instructions to Form 10-Q and article 10 of Regulation S-X and do not include
all of the information and footnote disclosures required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, the accompanying financial statements include all adjustments
(consisting of normal recurring accruals) necessary for a fair presentation of
the Company's financial position and results of operations. The results of
operations for the six month period ended October 31, 1998 may not be indicative
of the results that may be expected for the year ending April 30, 1999. These
statements should be read in conjunction with the financial statements and notes
thereto included in the Company's Form 10-K for the year-ended April 30, 1998.

Certain amounts have been reclassified in the Fiscal 1998 financial statements
to conform to the Registrant's 1999 presentation.


NOTE B - ACCOUNTING PERIODS

The Company's restaurant operations are conducted through its wholly-owned
subsidiary, Sea View Restaurants, Inc. ("Sea View"). The Company's consolidated
financial statements for the three months and six months ended October 31, 1998
and 1997 include Sea View's operations for the twelve weeks and twenty-four
weeks ended October 15, 1998 and October 16, 1997, respectively.




NOTE C - FIXED ASSETS
<TABLE>
<CAPTION>


                                                                October 31, 1998           April 30, 1998
                                                                ----------------           -------------- 
<S>                                                               <C>                      <C>
Construction in  progress                                          $  207,000               $     74,000
Leasehold improvements                                              2,747,000                  2,732,000
Furniture and equipment                                             1,046,000                  1,003,000
                                                                   ----------               ------------

                                                                    4,000,000                  3,809,000

Less accumulated depreciation and amortization                     (2,986,000)                (2,863,000)
                                                                   ----------               ------------

                                                                   $1,014,000               $    946,000
                                                                   ==========               ============
</TABLE>


                                       7
<PAGE>   8



               CALIFORNIA BEACH RESTAURANTS, INC. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

                                   (UNAUDITED)








NOTE D  - REVOLVING LINE OF CREDIT - RELATED PARTY

On November 24, 1997 Sea View entered into a one year, $1,000,000 unsecured line
of credit agreement with Outside LLC, an entity affiliated with one of the
Registrant's principal shareholders and with a member of its board of directors.
This agreement provides for interest of 10% on all amounts borrowed, requires a
commitment fee of 1.25% of the total line and is guaranteed by the Registrant.
The expiration date of the line of credit agreement was extended to February 28,
1999, on November 30, 1998. The line will be used by Sea View for seasonal
working capital needs as well as for certain renovations to Gladstone's. At
October 31, 1998, $500,000 was borrowed and outstanding under the line of
credit. The line of credit restricts any distribution to the Registrant except
for distributions for taxes paid or for repayment of intercompany loans.






                                       8
<PAGE>   9






               CALIFORNIA BEACH RESTAURANTS, INC. AND SUBSIDIARIES


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


RESULTS OF OPERATIONS


RESTAURANT REVENUES

Restaurant operations include the results of Gladstone's 4 Fish ("Gladstone's")
in Pacific Palisades, California and RJ's - Beverly Hills in Beverly Hills,
California.

Total sales for the three months ended October 31, 1998 were $3,584,000 compared
with $3,798,000 for the same period last year, a decrease of $214,000 or 5.6%.
For the six months ended October 31, 1998, total sales were $7,138,000 compared
with $7,798,000 for the same period last year, a decrease of $660,000 or 8.5%.
Gladstone's is located on the beach in Pacific Palisades, California and is
dependent, to a certain extent, on favorable weather and tourism. Gladstone's
has a large outside deck overlooking the Pacific ocean which is a very popular
destination but is only open as weather permits. Severe storms generated by the
"El Nino" weather phenomenon concluded during the six months ended October 31,
1998; however, the effects of such storms, including road closures and reduced
tourism, continued to adversely affect revenues through the three and six month
periods ended October 31, 1998, as compared to the same periods last year.

As a result of typically more favorable weather and higher tourism during the
summer months from May through September, the Registrant's sales and operating
profits have historically been higher in the first and second quarters of its
fiscal year.


COST OF GOODS SOLD

Cost of goods sold includes all food, beverages, liquor, direct labor and other
operating expenses, including rent, of the Registrant's restaurant operations.

Cost of goods sold for the three months ended October 31, 1998 was $2,968,000,
or, as a percentage of sales, 82.8% compared with $3,010,000, or, as a
percentage of sales, 79.3% during the same period last year. Cost of goods sold
for the six months ended October 31, 1998 was $5,905,000, or, as a percentage of
sales, 82.7% compared with $6,192,000, or, as a percentage of sales, 79.4%
during the same period last year.

The increase in cost of goods sold as a percentage of sales is primarily
attributable to increases in the minimum wage and increases in minimum rent
required by Sea View's new, twenty-year concession agreement with the County of
Los Angeles. The minimum wage in the State of California increased by $.15 per
hour on September 1, 1997, and $.60 per hour on March 1, 1998. At present, the
state of California, unlike most states, does not allow any adjustment of
minimum wage for employees that receive tips.


                                       9
<PAGE>   10



               CALIFORNIA BEACH RESTAURANTS, INC. AND SUBSIDIARIES

Cost of goods sold will typically be slightly lower during the first and second
quarters due to additional economies of scale that can be achieved with labor
and certain other costs when sales levels are higher. For the fiscal year ended
April 30, 1998, cost of goods sold, as a percentage of sales, was 87.4%.


SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

For the three months ended October 31, 1998, selling, general and administrative
expenses were $211,000 compared with $658,000 for the same period last year, a
decrease of $447,000 or 67.9%. For the six months ended October 31, 1998,
selling, general and administrative expenses were $423,000, compared with
$872,000 for the same period last year, a decrease of $449,000 or 51.5%. The
decrease is primarily due to the inclusion of a $339,000 bonus for two senior
executives and $79,000 in consulting fees relating to the new Gladstone's
concession agreement in the operating results for the three and six month
periods ended October 31, 1997. These costs did not recur in the three and six
month periods ended October 31, 1998.

LEGAL AND LITIGATION SETTLEMENT

For the three months ended October 31, 1998, legal and litigation settlement
expenses were $34,000, compared with $276,000 for the same period in the prior
year, a decrease of $242,000 or 87.7%. For the six months ended October 31,
1998, legal and litigation settlement expenses were $50,000, compared with
$361,000 for the same period in the prior year, a decrease of $311,000, or
86.1%.

The respective decreases are primarily due to the inclusion in the prior year
period operating results of legal expenses and settlement costs involving an
employment-related litigation matter and legal expenses associated with the
negotiation of Gladstone's twenty-year concession agreement.

OTHER INCOME AND EXPENSES

For the three and six months ended October 31, 1998, amortization expense was
$168,000 and $329,000, respectively. Amortization expense relates to the
Registrant's Goodwill and will approximate $714,000 per year.

For the three and six months ended October 31, 1998, interest expense was
$67,000 and $144,000, respectively. Interest expense for the three and six
months ended October 31, 1997 was $0 and $1,000, respectively. The increase in
interest expense for the three and six month periods ended October 31, 1998,
respectively, as compared to the comparable periods in the prior year, is
primarily attributable to maintenance of a $2,000,000 letter of credit pursuant
to the Gladstone's concession agreement that became effective November 1, 1997.
Additionally, the Registrant incurred interest expense in connection with Sea
View's line of credit agreement; the outstanding balance of such line of credit
at October 31, 1998 is $500,000. Sea View did not have a line of credit during
the comparable periods in the prior year.

IMPACT OF YEAR 2000

The Year 2000 Issue is the result of computer programs being written using two
digits rather than four to define the applicable year. Any of the Registrant's
computer programs that have 


                                       10
<PAGE>   11

time-sensitive software may recognize a date using "00" as the year 1900 rather 
than the year 2000. This could result in a system failure or miscalculations 
causing disruptions of operations, including, among other things, a temporary 
inability to process transactions, send invoices, or engage in similar normal 
business activities.

The Registrant has determined that it will be required to modify or replace
portions of its software so that its computer systems will function properly
with respect to dates in the year 2000 and thereafter. The Registrant also has
initiated formal communications with its significant suppliers and large
customers to determine the extent to which the Registrant's interface systems
are vulnerable to those third parties' failure to remediate their own year 2000
Issues. The Registrant presently believes that with modifications to existing
software and conversion to new software, the cost of which is not expected to be
material to the Registrant's results of operation or financial position, the
Year 2000 Issue will not pose significant operational problems for its computer
systems. The Registrant will use both internal and external resources to
reprogram, or replace, and test the software for Year 2000 modifications. The
Registrant anticipates completing the Year 2000 project prior to any anticipated
impact on its operating systems, and, accordingly, the Registrant has not
developed a Year 2000 contingency plan. However, if such modifications and
conversions are not made, or are not completed timely, the year 2000 Issue could
have a material adverse effect on the operations of the Registrant. Likewise,
there can be no assurance that the systems of other companies on which the
Registrant's systems rely will be timely converted and would not have a material
adverse effect on the Registrant.


LIQUIDITY AND CAPITAL RESOURCES

Sea View and the County executed a twenty year concession agreement for
Gladstone's that commenced on November 1, 1997 ("Agreement"). The terms of the
Agreement required Sea View post a $2,000,000 letter of credit as a security
deposit for rental payments due to the County. In the event that rents are not
paid when due, the County may draw upon the letter of credit. The letter of
credit will be reduced to an amount equal to three months minimum rent upon Sea
View's satisfaction of certain conditions, including completion of the required
capital improvements and maintenance of certain net worth levels. The Agreement
requires that Sea View complete at least $2,700,000 in capital improvements to
the restaurant facility by April, 1999.

The Registrant posted the letter of credit by utilizing cash collateral provided
by Overhead Partners, L.P. ("Overhead"), an entity affiliated with one of the
Registrant's principal shareholders and with a member of its board of directors.
The letter of credit, which previously was to expire on October 31, 1998, now
expires on December 31, 1998, unless extended prior to expiration. In
consideration of providing the cash collateral, the Registrant paid a fee to
Overhead of $100,000 for the period May 1, 1998 through October 31, 1998, and
will continue to pay $16,667 per month until the letter of credit is reduced,
terminated, or expires. In the event that any amounts are drawn down on the
letter of credit, such amounts will automatically convert into a debt obligation
of the Registrant, payable with interest ninety days (or earlier under certain
circumstances) from the date of such conversion.

On November 24, 1997 Sea View entered into a one year, $1,000,000 unsecured line
of credit agreement with Outside LLC, an entity affiliated with one of the
Registrant's principal shareholders and with a member of its board of directors.
This agreement provides for interest of 10% on all amounts borrowed, requires a
commitment fee of 1.25% of the total line and is guaranteed by the Registrant.
The expiration date of the line of credit agreement was extended to February 28,
1999, on November 30, 1998. The line will be used by Sea View for seasonal
working capital needs as well as for certain renovations to Gladstone's. At
October 31, 1998, 


                                       11
<PAGE>   12


$500,000 was borrowed and outstanding under the line of credit. The line of 
credit restricts any distribution to the Registrant except for distributions for
taxes paid or for repayment of intercompany loans.

The Registrant is currently evaluating available options to raise the necessary
funds or receive appropriate commitments to complete the required renovations to
Gladstone's, and has had discussions with related parties and third parties in
this regard. The Registrant is seeking to procure funding prior to January,
1999, when the major renovations to Gladstone's are anticipated to begin. Such
renovations had been expected to begin by October, 1998, but were postponed by
delays in obtaining necessary architectural approvals and other factors inherent
in the development process. There can be no assurance that the Registrant will
be successful in completing the required equity or debt financing. Failure to
substantially commence construction, as defined in the concession agreement, is
an event of default under such agreement.

The Registrant is also exploring various opportunities to expand its operations.
The Registrant's ability to expand is subject to the availability of debt or
equity financing on terms that are acceptable to the Registrant.
There can be no assurance that such financing will be available.

Capital expenditures for the six months ended October 31, 1998 totaled
approximately $192,000. The terms of the concession Agreement between Sea View
and the County require Sea View to expend approximately $2,700,000 on
renovations to Gladstone's. The timing of such renovations is subject to the
receipt of all necessary permits.


SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS

Except for the historical information contained herein, certain statements in
this Form 10-Q, including statements in this Item are "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. Such forward-looking statements involve known and unknown risks,
uncertainties and other factors which may cause the actual results, performance
or achievement of the Registrant, or industry results, to be materially
different from any future results, performance or achievements expressed or
implied by such forward-looking statements. Such factors include, among others,
the following: the Registrant's ability to secure adequate debt or equity
financing in order to comply with the terms of the Gladstone's concession
Agreement, including the maintenance of a $2,000,000 letter of credit, the
payment of significantly higher rental payments and completion of required
renovations; the Registrant's ability to generate an operating profit based on
the terms of the Gladstone's concession Agreement; the impact on the Registrant
of the Year 2000 Issue; that its principal source of cash is funds generated
from operations; that restaurants historically have represented a high risk
investment in a very competitive industry; general and local economic
conditions, which can, among other things, impact tourism, consumer spending and
restaurant revenues; weather and natural disasters, such as earthquakes and
fires, which can impact sales at the Registrant's restaurants; quality of
management; changes in, or the failure to comply with, governmental regulations;
unexpected increases in the cost of key food products, labor and other operating
expenses in connection with the Registrant's business; and other factors
referenced in this Form 10-Q and the Registrant's other filings with the SEC.


                                       12
<PAGE>   13




               CALIFORNIA BEACH RESTAURANTS, INC. AND SUBSIDIARIES


ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

        Not applicable as the Registrant is a small business issuer as defined 
        by SEC regulations.

                                     PART II

                                OTHER INFORMATION
                                -----------------   

Item 1.    LEGAL PROCEEDINGS.

           None

Item 2.    CHANGES IN SECURITIES AND USE OF PROCEEDS.

           None

Item 3.    DEFAULTS UPON SENIOR SECURITIES.

           None

Item 4.    SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

           Not applicable.

Item 5.    OTHER INFORMATION

           Not applicable.

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

               (a)  EXHIBITS
                    10.65 - Letter of Credit Agreement, dated as of November
                            1, 1998, by and between California Beach
                            Restaurants, Inc., Sea View Restaurants, Inc., and
                            Overhead Partners L.P., a California Limited 
                            Partnership

                    10.66 - Line of Credit Agreement, dated as of November 30, 
                            1998, by and between Sea View Restaurants, Inc., and
                            Outside LLC, a California Limited Liability Company.

                    27    - Financial data schedule

                REPORTS ON FORM 8-K

                None


                                       13
<PAGE>   14

               CALIFORNIA BEACH RESTAURANTS, INC. AND SUBSIDIARIES



                                  SIGNATURE(S)


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

                                 California Beach Restaurants, Inc. (Registrant)



Dated:  December 11, 1998        By: /S/ ALAN REDHEAD
                                 ---------------------------
                                     Alan Redhead
                                     Chief Executive Officer




                                 By: /S/ SAMUEL E. CHILAKOS
                                 ----------------------------  
                                     Samuel  E.  Chilakos
                                     Chief Financial Officer




                                       14

<PAGE>   15


               CALIFORNIA BEACH RESTAURANTS, INC. AND SUBSIDIARIES


INDEX TO EXHIBITS


Item
Number      Description
------      -----------   

10.65       Letter of Credit Agreement, dated as of November 1, 1998,
            by and between California Beach Restaurants, Inc., Sea View
            Restaurants, Inc., and Overhead Partners L.P., a California Limited
            Partnership (A)

10.66       Line of Credit Agreement, dated as of November 30, 1998, by and
            between Sea View Restaurants, Inc., and Outside LLC, a California
            Limited Liability Company. (A)

27          Financial data schedule (A)


(A)         FILED HEREWITH ELECTRONICALLY




                                       15