SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

     [X ] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
                              Exchange Act of 1934

                  For the quarterly period ended March 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 1-12271



                                  CARSON, INC.



             (Exact name of registrant as specified in its charter)


                  DELAWARE                               06-1428605
(State or other jurisdiction of incorporation   (I.R.S. Employer Identification
            or organization)                             Number)


                     64 Ross Road, Savannah Industrial Park
                             Savannah, Georgia 31405
          (Address, including zip code, of principal executive offices)



        Registrant's telephone number, including area code:(912) 651-3400




     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 such
filing requirements for the past 90 days.
                                                     Yes x No


     At May 1, 1998,  5,005,003 shares of the registrant's Class A Common Stock,
par value $0.01 per share,  1,859,677 shares of the registrant's  Class B Common
Stock, par value $0.01 per share, and 8,127,937 shares of the registrant's Class
C Common Stock, par value $0.01 per share were outstanding.


<PAGE>




                                  CARSON, INC.

                                      INDEX

Part I.  Financial Information                                             Page

         Item 1.

         Condensed Consolidated Balance Sheets
         March 31, 1998 and December 31, 1997................................3

         Condensed Consolidated Statements of Operations
         Three  Months Ended March 31, 1998 and 1997.........................4 

         Condensed Consolidated Statements of Cash Flow
         Three  Months Ended March 31, 1998 and 1997.........................5

         Notes to Condensed Consolidated Financial Statements................6-7

         Item 2.

         Management's Discussion and Analysis of Financial Condition
         and Results of Operations......................................... 8-11


Part II.  Other Information................................................. 12



         Signatures......................................................... 13


                                                         2

<PAGE>
<TABLE>
                                  CARSON, INC.
                     CONDENSED CONSOLIDATED BALANCE SHEETS
                      MARCH 31, 1998 AND DECEMBER 31, 1997
                                 (In thousands)
<S>                                                                                                   <C>              <C> 
 
                                                                                                          March 31,     December 31,

                           ASSETS                                                                           1998              1997
                                                                                                      -------------    -------------
                                                                                                        (Unaudited)
CURRENT ASSETS:
   Cash and cash equivalents .....................................................................    $       5,184    $     14,043
   Accounts receivable (less allowance for doubtful accounts and returns of $2,307
            and $3,881 at March 31, 1998 and December 31, 1997, respectively) ....................           30,111          28,148
   Inventories, net ..............................................................................           28,936          24,861
   Other current assets ..........................................................................              905             832
                                                                                                      -------------    -------------
            Total current assets .................................................................           65,136          67,884

PROPERTY, PLANT AND EQUIPMENT, net of accumulated depreciation ...................................           22,288          22,202

INVESTMENT IN AM COSMETICS .......................................................................            3,695           3,587

INTANGIBLES, net .................................................................................           99,700         100,385

OTHER ASSETS .....................................................................................            7,427           7,366
                                                                                                      -------------    -------------
                  TOTAL ASSETS ...................................................................    $     198,246    $    201,424
                                                                                                      =============    =============

                           LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
  Accounts payable ...............................................................................    $      10,152    $      8,567
  Due for A&J Cosmetics ..........................................................................            4,003           5,416
  Accrued expenses ...............................................................................            9,426           7,413
  Income taxes payable ...........................................................................            1,927           1,544
                                                                                                      -------------    -------------
           Total current liabilities .............................................................           25,508          22,940

LONG-TERM DEBT ...................................................................................          102,534         103,623

DUE FOR A&J COSMETICS ............................................................................             --             4,088

DEFERRED INCOME TAXES AND OTHER LIABILITIES ......................................................            1,705           1,742

MINORITY INTEREST IN SUBSIDIARY ..................................................................            7,636           7,500

STOCKHOLDERS' EQUITY:
   Preferred stock, $.01 par value, 10,000,000 shares authorized, none outstanding ...............             --               --
   Common stock:
        Class A, voting, $.01 par value, 150,000,000 shares authorized and 5,018,248 shares
           issued ................................................................................               50              50
        Class B, nonvoting, $.01 par value, 2,000,000 shares authorized and 1,859,677 shares
           issued and outstanding ................................................................               19              19
        Class C, voting, $.01 par value, 13,000,000 shares authorized and 8,127,937 shares
           issued and outstanding ................................................................               81              81

   Paid-in capital ...............................................................................           69,018          69,022
   Accumulated deficit ...........................................................................           (4,512)         (4,011)
   Accumulated other comprehensive losses ........................................................           (2,308)         (2,170)
   Note receivable from employee shareholders, net of discount ...................................           (1,378)         (1,353)
   Treasury stock, 13,245 shares of Class A common stock .........................................             (107)           (107)
                                                                                                      -------------    -------------
        Total stockholders' equity ...............................................................           60,863          61,531
                                                                                                      -------------    -------------
                  TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY .....................................    $     198,246    $    201,424
                                                                                                      =============    =============
 
 
                                 See notes to condensed consolidated financial statements.
 
</TABLE>
                                                         3

<PAGE>
<TABLE>
<S>                                                                                                      <C>                   <C>

                                  CARSON, INC.
          CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
               FOR THE THREE MONTHS ENDED MARCH 31, 1998 AND 1997
                     (In thousands, except per share data)
 
 
                                                                                                        Three Months Ended March 31,
                                                                                                         1998                   1997
                                                                                                -------------          -------------


Net sales ............................................................................          $      31,797          $     17,932
Cost of goods sold ...................................................................                 15,378                 7,880
                                                                                                -------------          -------------
Gross profit .........................................................................                 16,419                10,052

Expenses:
         Marketing and selling .......................................................                  8,691                 5,724
         General and administrative ..................................................                  5,948                 2,729
                                                                                                -------------          -------------
                                                                                                       14,639                 8,453
                                                                                                -------------          -------------
Operating income .....................................................................                  1,780                 1,599

Interest expense .....................................................................                 (2,837)                 (604)
Other income, net ....................................................................                    221                   223
                                                                                                -------------          -------------
(Loss) income before income taxes ....................................................                   (836)                1,218

Benefit from (provision for) income taxes ............................................                    335                  (536)
                                                                                                -------------          -------------
Net (loss) income ....................................................................          $        (501)         $        682
                                                                                                =============          =============
Basic and diluted net (loss) income per common share .................................          $       (0.03)         $       0.05
                                                                                                =============          =============
Weighted average common
         shares outstanding ..........................................................                 14,993                14,984
                                                                                                =============          =============
 
 
                                 See notes to condensed consolidated financial statements.
 
 
</TABLE>




                                                         4

<PAGE>
<TABLE>
<S>                                                                                                   <C>                   <C>

                                  CARSON, INC.
          CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
               FOR THE THREE MONTHS ENDED MARCH 31, 1998 AND 1997
                                 (In thousands)
 
 
                                                                                                        Three months ended March 31,
                                                                                                         1998                  1997
                                                                                                      --------              --------
OPERATING ACTIVITIES:
  Net (loss) income ....................................................................             $   (501)             $    682
  Adjustments to reconcile net (loss) income to
     net cash used in operating activities:
      Depreciation and amortization ....................................................                1,608                   544
      Provision for doubtful accounts ..................................................                  103                   112
      Other, net .......................................................................                   20                     6
      Changes in operating assets and liabilities,
        net of acquisitions:
          Accounts receivable ..........................................................               (2,066)                 (154)
          Inventories ..................................................................               (4,075)               (4,685)
          Other current assets .........................................................                   (7)                1,021
          Accounts payable .............................................................                1,585                  (518)
          Income taxes payable .........................................................                  383                   869
          Accrued expenses .............................................................                2,013                (2,286)
                                                                                                      --------              --------
              Total adjustments ........................................................                 (436)               (5,091)
                                                                                                      --------              --------
      Net cash used in operating activities ............................................                 (937)               (4,409)
                                                                                                      --------              --------
INVESTING ACTIVITIES:
  Additions to property, plant and equipment ...........................................               (1,090)               (1,188)
  Acquisitions of business assets, net of cash acquired ................................                 --                     107
                                                                                                      --------              --------
      Net cash used in investing activities ............................................               (1,090)               (1,081)
                                                                                                      --------              --------
FINANCING ACTIVITIES:
  Proceeds from long-term borrowings ...................................................                2,000                 5,113
  Principal payments on long-term debt .................................................               (3,089)                 (650)
  Payment on A&J Cosmetics payable .....................................................               (5,416)                 --
  Other, net ...........................................................................                 (327)                  (23)
                                                                                                      --------              --------
    Net cash (used in) provided by financing activities ................................               (6,832)                4,440
                                                                                                      --------              --------
NET DECREASE IN CASH AND CASH EQUIVALENTS ..............................................               (8,859)               (1,050)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD .......................................               14,043                 4,191
                                                                                                      --------              --------
CASH AND CASH EQUIVALENTS AT END OF PERIOD .............................................             $  5,184              $  3,141
                                                                                                      ========              ========
 
 
 
 
                                 See notes to condensed consolidated financial statements.
 

</TABLE>


                                                         5

<PAGE>



                                   CARSON, INC
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1.  Basis of Presentation

    The accompanying  condensed  consolidated  interim  financial  statements of
Carson, Inc. (the "Company") presented herein have been prepared by the Company,
without  audit,  pursuant to the rules and  regulations  of the  Securities  and
Exchange  Commission.  Certain  information  and footnote  disclosures  normally
included in annual  financial  statements  prepared in accordance with generally
accepted  accounting  principles  have  been  omitted  from  these  consolidated
financial  statements  pursuant  to  applicable  rules  and  regulations  of the
Securities and Exchange Commission. These financial statements should be read in
conjunction  with the audited  Consolidated  Financial  Statements and the notes
thereto of the  Company's  1997  Annual  Report on Form 10-K.  In the opinion of
management,  the accompanying  unaudited financial statements contain all normal
recurring  adjustments  necessary  to  present  fairly the  Company's  financial
position,  results of operations and cash flows at the dates and for the periods
presented.  Interim results of operations are not necessarily  indicative of the
results to be expected for a full year.  Certain prior period  amounts have been
reclassified to conform with the current period presentation.

2.  Inventories

    Inventories are summarized as follows (in thousands):


                               March 31, 1998                  December 31, 1997
               ------------------------------        ---------------------------
Raw materials                         $12,468                            $10,873
Work-in-process                         1,871                              1,651
Finished goods                         14,597                             12,337
               ------------------------------        ---------------------------
                                      $28,936                            $24,861
               ==============================        ===========================





                                                         6

<PAGE>




3.   Acquisition

         On  April  30,  1997,  the  Company   purchased  the  rights  to  sell,
distribute,  package,  manufacture  and market Cutex nail polish  remover,  nail
enamel,  nail care  treatment  products and nail care  implements  in the United
States and Puerto  Rico.  Unaudited  pro forma  results  have been  prepared for
comparative purposes only and include certain adjustments, such as an adjustment
to cost of goods sold per a  manufacturing  agreement  between  the  Company and
Chesebrough-Pond's USA Co., additional goodwill amortization, additional selling
expenses  related to an  agreement  between  the Company  and AM  Cosmetics  and
additional  interest expense on acquisition  debt,  among others.  The following
unaudited  pro forma results are not  necessarily  indicative of what the actual
consolidated  results of operations might have been if the Cutex acquisition had
been in effect as of the  beginning  of fiscal  1997,  or of future  results  of
operations of the consolidated Company (in thousands except per share amounts):




                                                              Three Months Ended
                                                                  March 31, 1997
                                                                     (Pro forma)
                                                       -------------------------
Net sales                                                                $21,981
Net (loss) income                                                           $742
Basic and diluted (loss) income per share                                  $0.05






4.  New Accounting Pronouncements

         Statement  of  Financial   Accounting  Standards  No.  130,  "Reporting
Comprehensive  Income"  ("SFAS No. 130") is effective for the  Company's  fiscal
year ending December 31, 1998. SFAS No. 130 establishes  standards for reporting
and  displaying  comprehensive  income and its components  (revenues,  expenses,
gains and losses) in a full set of general- purpose  financial  statements.  The
Company  has  adopted  SFAS No.  130 in the  current  fiscal  year as  required.
Comprehensive  income for the three  months  ended  March 31, 1998 was a loss of
$639,000  and  included a net loss of $501,000  and a loss of  $138,000  for the
effects of foreign currency  translation  adjustments.  Comprehensive income for
the three  months  ended March 31, 1997 was  $661,000 and included net income of
$682,000 and a loss of $21,000 for the effects of foreign  currency  translation
adjustments.

         Statement of Financial Accounting Standards No. 131, "Disclosures about
Segments of an  Enterprise  and Related  Information"  ("SFAS No.  131") is also
effective for the Company's  fiscal year ending  December 31, 1998. SFAS No. 131
establishes  standards  for the way  that  public  business  enterprises  report
information about operating segments in annual financial statements and requires
that those enterprises  report selected  information about operating segments in
interim  financial  reports  issued to  shareholders.  This  statement  does not
significantly alter the segment disclosures the Company provides.


                                                         7

<PAGE>




                     Management's Discussion and Analysis of
                  Results of Operations and Financial Condition

OVERVIEW

Forward-looking Statements

         This  report  on Form  10-Q as well as other  public  documents  of the
Company   contain   forward-looking   statements   which   involve   risks   and
uncertainties,  including (i) the Company's  plans to introduce new products and
product enhancements,  (ii) the Company's plans to make selective  acquisitions,
(iii) the Company's marketing,  distribution and manufacturing  expansion plans,
(iv) future financial performance,  (v) cash flows from operations, (vi) capital
expenditures,  (vii) the  availability of funds from currently  available credit
facilities and (viii) the cost and timely  implementation  of the Company's Year
2000  compliance   modifications.   The  Company's  actual  results  may  differ
materially from those discussed in such  forward-looking  statements.  When used
herein  and in the  Company's  future  filings,  the terms  "expects",  "plans",
"intends", "estimates",  "projects", or "anticipates" or similar expressions are
intended to identify  forward-looking  statements (within the meaning of Section
21E of the Securities  Exchange Act of 1934, as amended (the  "Exchange  Act")).
Such statements  reflect the current views of the Company with respect to future
events and are  subject to certain  risks,  uncertainties  and  assumptions.  In
addition to risk factors that may be described in the Company's filings with the
Securities and Exchange  Commission (the  "Commission")  (including this filing,
the Company's IPO prospectus dated October 14, 1996,the Company's exchange offer
prospectus dated December 19, 1997 and the Company's  1997 Annual Report on Form
10-K),  actual  results  could  differ  materially  from those  expressed in any
forward-looking  statements made by the Company.  Such risks,  uncertainties and
factors  include,  but are not  limited to,  foreign  business  risks,  industry
cyclicality,  fluctuations  in customer  demand and order pattern,  the seasonal
nature of the  business,  changes in  pricing,  the  identification  of suitable
acquisition   candidates,   changes  in  the  implementation  of  the  Company's
acquisition   plans,  the  availability  of  financing,   and  general  economic
conditions,  as well as other risks  detailed in the Company's  filings with the
Securities and Exchange Commission. Additional risk factors include, but are not
limited to, the following:  (a) the Company's success in implementing its growth
strategy,  including  its success in obtaining  financing  where  required,  (b)
difficulties or delays in developing and introducing new products or the failure
of  consumers  to  accept  new  product  offerings,   (c)  changes  in  consumer
preferences,  including  reduced  consumer  demand  for  the  Company's  current
products,  (d) the  nature  and extent of future  competition  in the  Company's
principal   marketing  areas,  and  (e)  political,   economic  and  demographic
developments in the United States,  Africa,  Brazil,  the Caribbean,  Europe and
other countries where the Company now does or in the future may do business.


General
         The Company is a leading manufacturer and marketer in the United States
of  selected  personal  care  products  for both the ethnic  market and the mass
market. The Company believes that it is one of the leading global  manufacturers
and marketers of ethnic hair care products for persons of African  descent.  The
Company's  flagship brand,  Dark & Lovely,  is the most widely recognized ethnic
brand name in the United  States  retail  ethnic hair care  market.  The Company
currently sells over 70 different products  specially  formulated to address the
unique  physiological  characteristics  of persons of African  descent under six
principal brand names, including Dark & Lovely,  Excelle,  Beautiful Beginnings,
Dark & Natural,  Magic and Let's Jam.  The majority of the  Company's  net sales
have  historically  been derived from hair relaxers and  texturizers,  which are
used to chemically treat and straighten hair ( constituting approximately 50% of
the Company's sales in 1997),  hair color,  men's  depilatory  products and hair
care maintenance products, primarily for persons of African descent. The Company
is expanding its product offerings to other segments of the ethnic personal care
market,  including cosmetics and skin care products. In addition, the Company is
a leading  marketer of nail care products to the United States mass market under
the Cutex brand name.








                                                         8

<PAGE>




         In the three months ended March 31,  1998,  approximately  35.0% of the
net sales of the Company were to customers outside the United States as compared
to 33.9% in the first  quarter of the prior fiscal  year.  The  following  table
presents the Company's net sales by geographic region for these periods (dollars
are in thousands):



Net sales to:             1998                %              1997            %
               --------------- ----------------  ----------------  -----------
United States          $20,650            65.0%           $11,860        66.1%
Africa                   7,805             24.5             2,567         14.3
Other                    3,342             10.5             3,505         19.6
               --------------- ----------------  ----------------  -----------
  Total                $31,797           100.0%            17,932       100.0%
               =============== ================  ================  ===========


     With the exception of sales in South Africa, Botswana, Lesotho, Namibia and
Swaziland,  which are  denominated  in South African Rand,  all of the Company's
sales are  recorded in U.S.  Dollars.  The Company does not view the exposure to
Rand  exchange  rate  fluctuations  as  significant  because  the South  African
subsidiary,   Carson   Holdings,   Limited   ("Carson  South  Africa"),   incurs
substantially  all of its costs in Rand.  Assets and liabilities of Carson South
Africa are  translated for  consolidation  purposes from South African Rand into
U.S.  Dollars at the rate of currency  exchange at the end of the fiscal period.
Revenues and expenses are  translated  at average  monthly  prevailing  exchange
rates.  Resulting  translation  differences  are  recognized  as a component  of
stockholders' equity.


Results of Operations

Quarter  Ended March 31, 1998 Compared to Quarter Ended March 31, 1997

Net Sales.  Consolidated net sales for the quarter ended March 31, 1998 of $31.8
million  increased $13.9 million,  or 77.3%,  over quarter ended March 31, 1997.
This increase is summarized as follows (dollars are in thousands):



                                   Quarter Ended       Quarter Ended
                                  March 31, 1998     March 31,  1997    % Change
                               -----------------  -------------------  ---------
Domestic core                            $13,336             $11,860       12.5
Cutex                                      5,481                   -         -
Let's Jam                                  1,141                   -         -
Salon Professional and Cosmetics             692                   -         -
                               -----------------  -------------------  ---------
   Total Domestic                         20,650              11,860       74.1
                               -----------------  -------------------  ---------
South Africa                               7,805               2,567      204.1
Other International                        3,342               3,505       (4.7)
                               -----------------  -------------------  ---------
   Total International                    11,147               6,072       83.6
                               -----------------  -------------------  ---------
   Consolidated                          $31,797             $17,932       77.3
                               =================  ===================  =========





                                                         9

<PAGE>

     Sales of the Company's  domestic core business,  ethnic hair care products,
amounted to $13.3  million in the quarter  ended March 31, 1998,  an increase of
$1.5 million,  or 12.5%,  compared to the quarter  ended March 31,  1997.Despite
this  increase,the  domestic  ethnic hair care  industry  continues  to be soft,
reflecting in part the effects of drug chain consolidation.Drugstores  represent
the largest source of retail sales for the domestic core business.

Gross Profit. Gross profit increased to $16.4 million in the quarter ended March
31, 1998 from $10.1  million in the quarter  ended March 31, 1997.  Gross margin
decreased to 51.6% for the quarter  ended March 31, 1998 from 56.1% for the same
quarter in 1997.  The decrease in gross margin is due in part to geographic  and
product  shifts  in  the  sales  mix  and to  decreased  production  volumes.  A
geographic  shift has occurred as Carson South Africa's net sales  accounted for
25% of consolidated  net sales in the quarter ended March 31, 1998,  compared to
14% of consolidated net sales in the quarter ended March 31, 1997. The effect of
this shift was to lower consolidated gross margin by 2.5 points, as Carson South
Africa has lower gross margins than in the U.S.  Gross margin has also decreased
due to the addition of the Let's Jam products,  which generated a relatively low
gross margin,  primarily due to high packaging  costs.  Management is working on
packaging  changes  and is also  considering  pricing  changes  to  bring  these
products more in line with the Company's  normal gross  margin.  Finally,  gross
margin was  adversely  impacted by reduced  production  volumes in the  Savannah
plant, brought about by the decision to reduce inventory balances.

Marketing and Selling Expenses. Marketing and selling expenses increased to $8.7
million in the quarter  ended  March 31,  1998 from $5.7  million in the quarter
ended March 31, 1997,  an increase of 52.6%.  This increase was primarily due to
the  additions  of  Cutex,  Let's  Jam and  Dark & Lovely  Cosmetics  as well as
expanded  marketing to support Carson South Africa sales. As a percentage of net
sales,  these  expenses  decreased to 27.3% during this period from 31.9% during
the comparable period in 1997.

General  and  Administrative   Expense.   General  and  administrative  expenses
increased to $5.9 million in the quarter  ended March 31, 1998 from $2.7 million
in the quarter ended March 31, 1997,  an increase of 118.0%.  As a percentage of
net sales,  general and  administrative  expenses increased to 18.7% during this
period from 15.2% during the comparable period in 1997. This increase was due in
part to increased  amortization  of intangibles  related to recent  acquisitions
combined with increased  professional  fees and personnel costs  associated with
the enhancement of  infrastructure  needed to support the Company's  anticipated
growth.

Operating Income.  As a result of the above changes,  operating income increased
to $1.8  million in the quarter  ended  March 31, 1998 from $1.6  million in the
quarter ended March 31, 1997.

Interest Expense.  Interest expense  increased  significantly to $2.8 million in
the quarter  ended March 31, 1998 from  $604,000 in the quarter  ended March 31,
1997. The increased  interest expense was the result of additional debt incurred
in 1997 to finance  acquisitions,  which was  subsequently  refinanced  with the
proceeds from the sale of $100 million aggregate  principal amount of 10 year 10
3/8 % Senior Subordinated Notes.

Other  Income.  Other  income  was flat for the  quarter  ended  March 31,  1998
compared to the same quarter of 1997.

Provision for Taxes. The provision for taxes decreased to a benefit of $335,000,
based on an effective  rate of 40%, in the quarter  ended March 31, 1998 from an
expense of  $536,000,  based on an effective  rate of 44%, in the quarter  ended
March 31, 1997. The effective tax rate has decreased from 1997 due to the larger
impact of the  earnings of Carson South  Africa,  which are taxed at lower rates
than the earnings in the United States.


Liquidity and Capital Resources

     In the three months ended March 31, 1998,  net cash used in operations  was
$937,000  largely as a result of a $4.1 million increase in inventory and a $2.1
million  increase in accounts  receivable  offset by a $1.6 million  increase in
accounts payable and a $2.0 million increase in accrued  expenses.  The increase
in  inventory  is  attributable  to  increased  sales of Carson South Africa and
higher cosmetics inventories in preparation for the full launch of Dark & Lovely
Cosmetics.

     Net cash used in investing  activities for the three months ended March 31,
1998 consisted of capital expenditures of $1.1 million.

     
                                                        10
<PAGE>


     Net cash used in financing  activities for the three months ended March 31,
1998 totaled $6.8 million primarily as a result of the scheduled payment of $5.4
million for the purchase of A&J  Cosmetics  and a $1.0  million  decrease in the
Company's outstanding revolver balance. 

     The Company  believes that cash flow from  operating  activities,  existing
cash balances and  available  borrowings  under its Amended and Restated  Credit
Agreement  will be  sufficient  to fund working  capital  requirements,  capital
expenditures  and  debt  service  requirements  in the  foreseeable  future.  In
addition, the Company is considering liquidating part of its ownership in Carson
South Africa and thereby  generating  significant funds which would be available
for a strategic acquisition or repayment of existing debt.


Year 2000 Computer Issue

The Company currently utilizes two computer  information systems. The JD Edwards
financial  package is used to support  several  financial  applications.  In its
distribution and manufacturing  operations,  the Company uses a software package
known as PRISM developed by MARCAM.  The JD Edwards and PRISM packages run on an
IBM AS/400 computer and are currently not year 2000 compliant.

The  Company  has two  options to  achieve  year 2000  compliance  with its core
business  information  systems.  Option 1 is to upgrade the JD Edwards and PRISM
software with the year 2000 compliant  releases.  The newer release of the PRISM
software  has  additional  features  and  functionality  that  would  require  a
significant  amount of  consulting  to assist with  installation  and  training.
Management  estimates  the cost of this  option  at  $100,000  to  $300,000  and
believes that option 1 could be functional by December 31, 1998.

Option 2 is to install a single vendor solution.  This option would achieve both
year 2000 compliance and install a single vendor,  integrated  business software
package.  Management  estimates the cost of option 2 to be $500,000 to $750,000.
Management  believes  that option 2 could be  functional by the end of the first
quarter of 1999.

Management  will  make the  final  decision  on this  issue  and take  action to
implement it in the second quarter of 1998.



                                                        11

<PAGE>




                                  CARSON, INC.

                           PART II. OTHER INFORMATION

Item 1.  Legal Proceedings

     The Company is party to lawsuits  incidental  to its  business.  Management
believes that the ultimate  resolution of these matters will not have a material
adverse  impact on the business or financial  condition  and  operations  of the
Company.

Item 2.  Changes in Securities

     None

Item 3.  Defaults upon Senior Securities

     None

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

     None.

Item 5.  Other Information

     None

Item 6.  Exhibits and Reports on Form 8-K

(a)    Exhibits --

     27                  Financial data schedule.


(b)    Reports on Form 8-K --

     None



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<PAGE>



                                                    SIGNATURES

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

CARSON, INC.


/s/ Roy Keith
Roy Keith                                                    Date: May  15, 1998
Chairman and Chief Executive Officer



/s/ Robert W. Pierce
Robert W. Pierce                                              Date: May 15, 1998
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)





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