<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 ACT OF 1934

For quarterly period ended August 1, 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:  0-02788

                         THE ELDER-BEERMAN STORES CORP.
             (Exact name of registrant as specified in its charter)


                  OHIO                                         31-0271980
     (State or other jurisdiction of                        (I.R.S. employer
     incorporation or organization)                        identification no.)

     3155 EL-BEE ROAD, DAYTON, OHIO                               45439
(Address of principal executive offices)                       (Zip Code)

                                 (937) 296-2700
              (Registrant's telephone number, including area code)

                                 NOT APPLICABLE
              (Former name, former address and former fiscal year,
                          if changed since last report)

--------------------------------------------------------------------------------

         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
                                             -----   -----

                      APPLICABLE ONLY TO CORPORATE ISSUERS:

         Indicate the number of shares outstanding of the issuer's classes of
common stock, as of the latest practicable date.

         As of September 14, 1998, 15,898,148 shares of the issuer's common
stock, without par value, were outstanding.


================================================================================



<PAGE>   2



                         THE ELDER-BEERMAN STORES CORP.

                                      INDEX

<TABLE>
<CAPTION>
PART I.      FINANCIAL INFORMATION                                                                      PAGE
<S>                                                                                                     <C>
ITEM 1.      Financial Statements

             Condensed Consolidated Balance Sheets as of January 31, 1998
             and as of August 1, 1998 (Unaudited).........................................................1

             Condensed Consolidated Statements of Operations for the 13 weeks
             ended August 2, 1997 and August 1, 1998 (Unaudited)..........................................2

             Condensed Consolidated Statements of Operations for the 26 weeks
             ended August 2, 1997 and August 1, 1998 (Unaudited)..........................................3

             Condensed Consolidated Statements of Cash Flows for the 13 weeks 
             ended August 2, 1997 and August 1, 1998 (Unaudited)..........................................4

             Notes to Condensed Consolidated Financial Statements (Unaudited).............................5

ITEM 2.      Management's Discussion and Analysis of Consolidated Financial Condition
             and Results of Operations....................................................................7

ITEM 3.      Quantitative and Qualitative Disclosures About Market Risk...................................9


PART II.     OTHER INFORMATION

ITEM 1.      Legal Proceedings............................................................................9

ITEM 2.      Changes in Securities and Use of Proceeds...................................................10

ITEM 3.      Defaults Upon Senior Securities.............................................................10

ITEM 4.      Submission of Matters to a Vote of Security Holders.........................................10

ITEM 5.      Other Information...........................................................................10

ITEM 6.      Exhibits and Reports on Form 8-K............................................................10


SIGNATURES...............................................................................................12

EXHIBIT INDEX............................................................................................13
</TABLE>



<PAGE>   3



                         PART I. - FINANCIAL INFORMATION

ITEM 1.      FINANCIAL STATEMENTS.

                 THE ELDER-BEERMAN STORES CORP. AND SUBSIDIARIES
                      Condensed Consolidated Balance Sheets
                             (Dollars in thousands)
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                       August 1, 1998              Jan. 31, 1998
                                                                                       --------------              -------------
<S>                                                                                       <C>                        <C>     
ASSETS
------

Current assets:
     Cash and equivalents                                                                  $  7,123                   $  6,497
     Customer accounts receivable (less allowance for doubtful
         accounts: August 1, 1998 - $3,447; January 31, 1998 -
         $4,177)                                                                            119,675                    136,705
     Merchandise inventories                                                                192,534                    137,507
     Other current assets                                                                    18,356                     12,646
                                                                                           --------                   --------
         Total current assets                                                               337,688                    293,355

Property, fixtures and equipment, less accumulated depreciation
     and amortization                                                                        80,446                     63,256

Other assets                                                                                 21,970                     14,754
                                                                                           --------                   --------
         Total assets                                                                      $440,104                   $371,365
                                                                                           ========                   ========

LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------

Current liabilities:
     Current portion of long-term obligations:                                             $  1,105                   $  1,105
     Accounts payable                                                                        58,875                     49,005
     Other accrued liabilities                                                               32,100                     29,186
                                                                                           --------                   --------
         Total current liabilities                                                           92,080                     79,296

Long-term obligations, less current portion                                                 191,726                    142,024
Deferred items                                                                               10,416                      4,534
                                                                                           --------                   --------
         Total liabilities                                                                  294,222                    225,854
                                                                                           ========                   ========
Shareholders' equity:
     Common stock, no par, 12,678,148 shares on August 1, 1998 and 12,583,789 on
     January 31, 1998 issued and
     outstanding                                                                            201,234                    199,351
     Unearned compensation - restricted stock, net                                           (2,539)                    (1,225)
     Retained earnings                                                                      (52,813)                   (52,615)
                                                                                           --------                   --------
     Total shareholders' equity                                                             145,882                    145,511
                                                                                           --------                   --------
     Total liabilities and shareholders' equity                                            $440,104                   $371,365
                                                                                           ========                   ========
</TABLE>


See notes to condensed consolidated financial statements.


                                        1

<PAGE>   4



                 THE ELDER-BEERMAN STORES CORP. AND SUBSIDIARIES
                 Condensed Consolidated Statements of Operations
                (Dollars in thousands, except per share amounts)
                                   (Unaudited)


<TABLE>
<CAPTION>
                                                                                      13 weeks ended              13 weeks ended
                                                                                      August 1, 1998              August 2, 1997
                                                                                      --------------              --------------
<S>                                                                                    <C>                          <C>      
Revenues:
     Net sales                                                                          $   125,464                  $ 122,112
     Financing                                                                                6,177                      6,493
                                                                                        -----------                  ---------
Total revenues                                                                              131,641                    128,605
Costs & expenses:
     Cost of goods sold, occupancy, and buying expenses                                      91,002                     88,887
     Selling, general, administrative, and other expenses                                    35,585                     35,634
     Provision for doubtful accounts                                                          1,112                      1,133
     Interest expense                                                                         2,980                      1,587
     Other expense                                                                                -                        853
     Acquisition & integration expense                                                          570                          -
                                                                                        -----------                  ---------
         Total costs & expenses                                                             131,249                    128,094

Income before reorganization items and income tax expense                                       392                        511
Reorganization items                                                                              -                      2,846
                                                                                        -----------                  ---------
Income (loss) before income tax expense                                                         392                     (2,335)
Income tax expense                                                                              153                          -
                                                                                        -----------                  ---------
Net income(loss)                                                                        $       239                  $  (2,335)
                                                                                        ===========                  =========

Basic net income (loss) per common share                                                $      0.02                  $  (18.83)

Basic weighted average number of shares outstanding                                      12,504,857                    124,036

Diluted net income (loss) per common share                                              $      0.02                   $ (18.83)
Diluted weighted average number of shares outstanding                                    13,451,388                    124,036
</TABLE>


See notes to condensed consolidated financial statements.



                                       2
<PAGE>   5



                 THE ELDER-BEERMAN STORES CORP. AND SUBSIDIARIES
                 Condensed Consolidated Statements of Operations
                (Dollars in thousands, except per share amounts)
                                   (Unaudited)


<TABLE>
<CAPTION>
                                                                                       26 weeks ended            26 weeks ended
                                                                                       August 1, 1998            August 2, 1997
                                                                                       --------------            --------------
<S>                                                                                    <C>                          <C>     
Revenues:
     Net sales                                                                          $   252,188                  $241,933
     Financing                                                                               12,675                    13,227
                                                                                        -----------                  --------
Total revenues                                                                              264,863                   255,160
Costs & expenses:
     Cost of goods sold, occupancy, and buying expenses                                     182,829                   175,564
     Selling, general, administrative, and other expenses                                    73,309                    73,114
     Provision for doubtful accounts                                                          2,689                     2,213
     Interest expense                                                                         5,784                     3,055
     Other expense                                                                                -                       609
     Acquisition & integration expense                                                          570                         -
                                                                                        -----------                  --------
         Total costs & expenses                                                             265,181                   254,555

Income (loss) before reorganization items and income tax
benefit                                                                                        (318)                      605
Reorganization items                                                                              -                     6,209
                                                                                        -----------                  --------
Loss before income tax benefit                                                                 (318)                   (5,604)
Income tax benefit                                                                             (121)                        -
                                                                                        -----------                  --------
Net loss                                                                                $      (197)                 $ (5,604)
                                                                                        ===========                  ========

Basic and diluted net loss per common share                                             $     (0.02)                 $ (45.18)
Basic weighted average number of shares outstanding                                      12,500,927                   124,036
</TABLE>


See notes to condensed consolidated financial statements.




                                       3
<PAGE>   6



                 THE ELDER-BEERMAN STORES CORP. AND SUBSIDIARIES
                 Condensed Consolidated Statements of Cash Flows
                             (Dollars in thousands)
                                   (Unaudited)


<TABLE>
<CAPTION>
                                                                                       26 weeks ended            26 weeks ended
                                                                                       August 1, 1998            August 2, 1997
                                                                                       --------------            --------------
<S>                                                                                       <C>                        <C>     
Cash flows from operating activities:
     Net loss                                                                              $   (197)                  $(5,604)
     Adjustments to reconcile net loss to net cash provided
     by (used in) operating activities:
         Depreciation and amortization                                                        6,426                     5,998
         Changes in operating assets and liabilities, net                                   (10,420)                      343
                                                                                           --------                   -------
              Net cash provided by (used in) operating activities                            (4,191)                      737

Cash flows from investing activities:
     Capital expenditures, net                                                               (3,885)                   (6,032)
     Business acquisition, net of cash purchased                                            (20,179)                        -
     Real estate acquired                                                                    (2,814)                        -
     Proceeds from the sale of fixed assets                                                     114                         -
                                                                                           --------                   -------
          Net cash used in investing activities                                             (26,764)                   (6,032)

Cash flows from financing activities:
     Net borrowings (payments) under debtor-in-possession
     agreement                                                                                    -                     5,346
     Net borrowings (payments) under asset securitization
     agreement                                                                              (15,977)                        -
     Net borrowings (payments) under revolving lines of credit                               66,420                         -
     Payments on long-term obligations                                                         (741)                     (136)
     Retirement of assumed debt                                                             (17,582)                        -
     Other                                                                                     (539)                     (125)
                                                                                           --------                   -------
          Net cash provided by financing activities                                          31,581                     5,085

                                                                                           --------                   -------
Increase (decrease) in cash and equivalents                                                     626                     (210)

Cash and equivalents - beginning of period                                                    6,497                     7,091
                                                                                           --------                   -------
Cash and equivalents - end of period                                                       $  7,123                   $ 6,881
                                                                                           ========                   =======


Supplemental cash flow information:
     Interest paid                                                                            5,527                     3,104
     Income taxes paid                                                                          192                       183
</TABLE>


See notes to condensed consolidated financial statements.





                                       4
<PAGE>   7



                 THE ELDER-BEERMAN STORES CORP. AND SUBSIDIARIES
              Notes to Condensed Consolidated Financial Statements
                (Dollars in thousands, except per share amounts)
                                   (Unaudited)


1.   Basis of Presentation

     The accompanying unaudited condensed consolidated financial statements
     include accounts of The Elder-Beerman Stores Corp. and its wholly-owned
     subsidiaries (the "Company"). All intercompany transactions and balances
     have been eliminated in consolidation. In the opinion of management, all
     adjustments (primarily consisting of normal recurring accruals) considered
     necessary for a fair presentation for all periods presented, have been
     made.

     On December 30, 1997, the Company substantially consummated its Third
     Amended Joint Plan of Reorganization, dated November 17, 1997, as amended
     (the "Plan"), which was confirmed by an order of the United States         
     Bankruptcy Court for the Southern District of Ohio, Western Division (the  
     "Bankruptcy Court") entered on December 16, 1997. Accordingly, the
     condensed consolidated financial statements as of and for the 13 weeks
     ended August 2, 1997 and the 26 weeks ended August 2, 1997, are presented
     in accordance with American Institute of Certified Public Accountants
     Statement of Position 90-7, Financial Reporting by Entities in
     Reorganization under the Bankruptcy Code. The reorganization expense for
     the 13 weeks ended August 2, 1997 and the 26 weeks ended August 2, 1997
     consists of professional fees and other bankruptcy related expenses.

     Certain information and footnote disclosures normally included in the
     financial statements prepared in accordance with generally accepted
     accounting principles have been condensed or omitted. The Company's
     business is seasonal in nature and the results of operations for the
     interim periods are not necessarily indicative of the results for the full
     fiscal year. It is suggested these condensed consolidated financial
     statements be read in conjunction with the financial statements and the
     notes thereto included in the Company's Annual Report on Form 10-K for the
     year ended January 31, 1998.

2.   Per Share Amounts

     Basic income (loss) per common share is computed by dividing net income
     (loss) by the weighted-average number of common shares outstanding. Stock
     options, restricted shares, deferred shares, and warrants outstanding
     represent potential common shares and are included in computing diluted
     income per share when the effect would be dilutive.

3.   Stock-Based Compensation

     During the second quarter of 1998, a total of 7,500 stock options with an
     exercise price of $24.375 per share were granted to designated employees
     under the Company's Equity and Performance Incentive Plan. These options
     granted have a maximum term of ten years and vest over a period of five
     years.

     Also during the second quarter of 1998, 6,371 shares of restricted stock
     were awarded under the Annual Incentive Plan. These shares have a vesting
     date of January 31, 2001. The fair value of the restricted shares awarded
     is $93 and is being amortized over the vesting period. In addition, 25,488
     deferred shares were awarded under the same program and have a vesting date
     of January 31, 2001.

     Non-employee directors may take all or a portion of their annual base
     retainer fee in the form of a discounted stock option. During the second
     quarter of 1998, a total of 2,055 stock options, with an exercise price of
     $21.00, were granted under this plan. These options vest on January 31,
     1999.

4.   Subsequent Events

     In August 1998 the Company issued 3,220,000 shares of additional common
     stock. A net amount of $66.2 million, before expenses, was raised from the
     offering.



                                       5
<PAGE>   8



5.   Acquisition

     On July 27, 1998, the Company acquired Stone & Thomas for a purchase price
     of approximately $20.2 million in cash, subject to post-closing
     adjustments. Stone & Thomas operated 20 department stores located in West
     Virginia, Ohio, Kentucky, and Virginia under the name Stone & Thomas. This
     transaction will be accounted for as a purchase.


     Pro forma summary of operations data (unaudited)

         The unaudited pro forma summary of operations data for each of the
         13-week periods and 26-week periods ending August 1, 1998 and August 2,
         1997, have been prepared by combining the condensed consolidated
         statement of operations of The Elder-Beerman Stores Corp. with the
         consolidated statement of operations of Stone & Thomas for the same
         periods. To comply with disclosures required by generally accepted
         accounting principles related to acquisitions, the following unaudited
         pro forma financial information is presented as though the acquisition
         occurred at the beginning of 1997. The expected synergy of this
         acquisition after integration with existing businesses, including the
         disposition of stores, is not permitted to be reflected in the pro
         forma results. Therefore, pro forma results are not indicative of
         results of operations in the future or in the periods presented below.
         Included in the pro forma is the estimated purchase price allocation
         and the issuance of additional common shares. The net proceeds of the
         additional common shares were used in part to purchase Stone & Thomas.


                                                   13 weeks ended

                                       August 1, 1998           August 2, 1997
                                       --------------           --------------
Net sales                                 $147,475                 $149,851
Net loss                                  $ (4,598)                $ (5,036)
Basic and diluted net loss 
  per common share                        $  (0.29)                $  (1.51)



                                                    26 weeks ended

                                       August 1, 1998           August 2, 1997
                                       --------------           --------------
Net sales                                 $295,622                 $296,862
Net loss                                  $ (8,256)                $(11,302)
Basic and diluted net loss   
  per common share                        $  (0.53)                $  (3.38)



         The above pro forma reflects the operation of all 20 Stone & Thomas
         stores. The Company has closed two stores and is currently in the 
         process of selling eight locations. The pro forma net sales using 
         only the 10 continuing Stone & Thomas stores are as follows:



                                       August 1, 1998           August 2, 1997
                                       --------------           --------------
13 weeks ended                            $140,612                 $141,730
26 weeks ended                            $282,567                 $281,100

6.   Comprehensive Income

     Effective February 1, 1998, the Company adopted Statement of Financial
     Accounting Standards No. 130, Reporting Comprehensive Income. Adoption of
     this standard had no impact on the Company's financial statements.



                                       6
<PAGE>   9
ITEM 2.      MANAGEMENT'S DISCUSSION AND ANALYSIS OF CONSOLIDATED FINANCIAL
             CONDITION AND RESULTS OF OPERATIONS.

     This Quarterly Report on Form 10-Q contains certain forward-looking
statements that are based on management's current beliefs, estimates and
assumption concerning the operations, future results and prospects of
Elder-Beerman and the retail industry in general. All statements that address
operating performance, events or developments that management anticipates will
occur in the future, including statements related to future sales, profits,
expenses, income and earnings per share, future finance and capital market
activity, or statements expressing general optimism about future results, are
foward-looking statements. In addition, words such as "expects," "anticipates,"
"intends," "plans," "believes," "estimates," variations of such words and
similar expressions are intended to identify forward-looking statements.

     The statements described in the preceding paragraph constitute
"forward-looking statements" within the meaning of Section 27A of the Securities
Act of 1933 (the "Securities Act"). Because these statements are based on a
number of beliefs, estimates and assumptions that could cause actual results to
materially differ from those in the forward-looking statements, there is no
assurance that forward-looking statements will prove to be accurate.

     Any number of factors could affect future operations and results, including
the following: increasing price and product competition; fluctuations in
consumer demand and confidence; the availability and mix of inventory;
fluctuations in costs and expenses; the effectiveness of advertising, marketing
and promotional programs; weather conditions that affect consumer traffic in
stores; the continued availability and terms of financing; the outcome of
pending and future litigation; and general economic conditions, such as the rate
of employment, inflation and interest rates and the condition of the capital
market. This list of factors is not exclusive.

     Forward-looking statements are subject to the safe harbors created in the
Securities Act. Elder-Beerman undertakes no obligation to update publicly any
forward-looking statements, whether as a result of new information, future 
events or otherwise. 

     The following information should be read in conjunction with the Condensed
Consolidated Financial Statements and Notes included in Part I, Item 1. The
following information should also be read in conjunction with the Audited
Consolidated Financial Statements and Notes, and Management's Discussion and
Analysis of Financial Condition and Results of Operations for the year ended
January 31, 1998 as contained in the Company's Annual Report on Form 10-K.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS

     The following is a discussion of the financial condition and results of
operations of the Company for the 13-week periods ended August 1, 1998 ("Second
Quarter 1998") and August 2, 1997 ("Second Quarter 1997"), and the 26-week
periods ended August 1, 1998 ("First Half 1998") and August 2, 1997 ("First Half
1997"). The Company's fiscal year ends on the Saturday closest to January 31st.
The discussion and analysis that follow are based upon and should be read in
conjunction with the Condensed Consolidated Financial Statements and the Notes
thereto included in Part I, Item 1.

RESULTS OF OPERATIONS

     Second Quarter 1998 Compared to Second Quarter 1997

     Net sales for the Second Quarter 1998 increased by 2.8% to $125.5 million
from $122.1 million for the Second Quarter 1997. The increase is due to a 6.0%
comparable store sales increase for the department store division, and a 6.4%
comparable store sales increase for the Bee-Gee Shoe division. The department
store comparable sales results include the Dayton flagship store relocated from
the Southtown shopping center to the Dayton Mall in July 1998. Men's and ladies
sportswear, intimate apparel, furniture, and domestics led the sales increase
for the department stores.

     Financing revenue from the Company's private label credit card for the
Second Quarter 1998 decreased to $6.2 million from $6.5 million for the
Second Quarter 1997. The decline in finance charges is due to a reduction in
outstanding customer accounts receivable and has been partially offset by an
increase in late fees charged.

     Cost of goods sold, occupancy, and buying expenses decreased to 72.5% of
net sales for the Second Quarter 1998 from 72.8% of net sales for the Second
Quarter 1997. This decrease is primarily due to improved gross margin
performance, which was partially offset by an increase in the buying staff
payroll as a result of being more fully staffed, and an increase in depreciation
due to capital expenditures in 1997.

     Selling, general, and administrative expenses decreased to 28.4% of net
sales for the Second Quarter 1998 from 29.2% for the Second Quarter 1997. This
was due to an improvement in store selling and customer service expenditures,
modifications to fringe benefit plans, and the leveraging of several semi-fixed
costs, most notably service and operations, utilities, and advertising.
Additionally, last year's expense reflected a reduction due to an Internal
Revenue Service settlement.

     Provision for doubtful accounts was 0.9% of net sales for the Second
Quarter 1998, unchanged from the Second Quarter 1997.



                                       7
<PAGE>   10



     Interest expense increased to $3.0 million for the Second Quarter 1998 from
$1.6 million for the Second Quarter 1997. The increase is due to the financing
required to support the payment of bankruptcy obligations in connection with the
consummation of the Company's chapter 11 plan of reorganization.

     There was no other expense for the Second Quarter 1998 compared to an
expense of $0.9 for the Second Quarter 1997. The expense last year was realized
from a swap mark-to-market adjustment on the unhedged portion of swap agreements
in place at that time.

     On July 27, 1998 the Company acquired Stone & Thomas, a West Virginia
corporation ("Stone & Thomas"), a department store retailer based in Wheeling,
West Virginia. The acquisition and integration expense of $0.6 million are
non-recurring expenses incurred at the end of the Second Quarter 1998, and
relate to interim financing for the purchase transaction.

     Reorganization costs were zero for the Second Quarter 1998 versus $2.8
million for the Second Quarter 1997 because of the Company's emergence from
bankruptcy protection in December 1997.

     An income tax expense was recorded in the Second Quarter 1998 at the rate
of 39.0%. An income tax benefit was not recorded in the Second Quarter 1997
because the Company remained under bankruptcy protection.

     FIRST HALF 1998 COMPARED TO FIRST HALF 1997

     Net sales for the First Half 1998 increased by 4.2% to $252.2 million from
$241.9 million for the First Half 1997. The increase is due to an 8.3%
comparable store sales increase for the department store division, and a 4.6%
comparable store sales increase for the Bee-Gee Shoe division. The department
store comparable sales results include the relocated Dayton flagship store.
Women's sportswear, men's clothing and men's sportswear, furniture, and intimate
apparel led the sales increase for the department stores.

     Financing revenue from the Company's private label credit card for the
First Half 1998 decreased to $12.7 million from $13.2 million for the First
Half 1997. The decline in finance charges is due to a reduction in outstanding
customer accounts receivable and has been partially offset by an increase in
late fees charged.

     Cost of goods sold, occupancy, and buying expenses decreased to 72.5% of
net sales for the First Half 1998 from 72.6% of net sales for the First Half
1997. This decrease is primarily due to improved gross margin performance in the
second quarter, which was partially offset by an increase in the buying staff
payroll as a result of being more fully staffed, and an increase in depreciation
due to capital expenditures in 1997.

     Selling, general, and administrative expenses decreased to 29.1% of net
sales for the First Half 1998 from 30.2% for the First Half 1997. This was due
to an improvement in store selling and customer service expenditures,   
modifications to fringe benefit plans, and the leveraging of several semi-fixed
costs, most notably service and operations, utilities, and advertising.
Additionally, last year's expense reflected a reduction due to an Internal
Revenue Service settlement.

     Provision for doubtful accounts increased to 1.1% of net sales for the
First Half 1998 from 0.9% for the First Half 1997. The increase is primarily due
to the level of delinquent accounts and receivable charge-offs in previous
months.

     Interest expense increased to $5.8 million for the First Half 1998 from
$3.1 million for the First Half 1997. The increase is due to the financing
required to support the payment of bankruptcy obligations in connection with the
consummation of the Company's chapter 11 plan of reorganization.

     There was no other expense for the First Half 1998 compared to an expense
of $0.6 for the First Half 1997. The expense last year was realized from a swap
mark-to-market adjustment on the unhedged portion of swap agreements in place at
that time.

     Reorganization costs were zero for the First Half 1998 versus $6.2 million
for the First Half 1997 because of the Company's emergence from bankruptcy
protection in December of 1997.



                                       8
<PAGE>   11



     An income tax benefit was recorded in the First Half 1998 at the rate of
38.0%. An income tax benefit was not recorded in the First Half 1997 because the
Company remained under bankruptcy protection.

LIQUIDITY AND CAPITAL RESOURCES

     The Company's principal sources of funds are cash flow from operations and
borrowings under its Revolving Credit Facility and Receivable Securitization
Facility (collectively, the "Credit Facilities"). The Company's primary ongoing
cash requirements are to fund debt service, make capital expenditures, and
finance working capital.

     Net cash used in operating activities was $4.2 million for the First Half
1998, compared to $0.7 million being provided in the First Half 1997. During the
First Half 1998 approximately $10.6 million in payments were made for
professional fees, administration payments, lease cure payments, and other items
that were related to the bankruptcy, which was partially offset by a $5.4
million reduction in pre-tax loss.

     Net cash used in investing activities was $26.8 million for the First Half
1998, compared to $6.0 million for the First Half 1997. The Stone & Thomas
acquisition on July 27, 1998 required an investment of $20.2 million, net of
cash purchased. The Company also purchased for $2.8 million the department store
building that housed the Southtown shopping center store. This location was
relocated to the Dayton Mall, and the Southtown location has been placed for
sale, with an anticipated sale closing occurring in Fiscal 1998. Capital
expenditures for store maintenance, remodeling, and data processing totaled $3.9
million for the First Half 1998 compared to $6.0 million for the First Half
1997.

     For the First Half 1998, net cash provided by financing activities was
$31.6 million compared to $5.1 for the First Half 1997. This increase is
primarily due to the acquisition of Stone & Thomas.

     In August 1998 the Company issued 3,220,000 shares of additional common
stock. A net amount of $66.2 million, before expenses, was raised from the
offering.

     The Company believes that it will generate sufficient cash flow from
operations, as supplemented by its available borrowings under the Credit
Facilities, to meet anticipated working capital and capital expenditure
requirements, as well as debt service requirements under the Credit Facilities.

     The Company may from time to time consider acquisitions of department store
assets and companies. Acquisition transactions, if any, are expected to be
financed through a combination of cash on hand from operations and the possible
issuance from time to time of long-term debt or other securities. Depending upon
the conditions in the capital markets and other factors, the Company will from
time to time consider the issuance of debt or other securities, or other
possible capital market transactions, the proceeds of which could be used to
refinance current indebtedness or for other corporate purposes.

ITEM 3.     QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

            Not Applicable.


                          PART II. - OTHER INFORMATION


ITEM 1.     LEGAL PROCEEDINGS.

     The Company is currently involved in several legal proceedings arising from
its normal business activities and reserves have been established where
appropriate. However, no legal proceedings have arisen or become reportable
events during this quarter, and management believes that none of the remaining
legal proceedings will have a material adverse effect on the financial
condition, results of operations or cash flows of the Company.

     In addition, as a result of the bankruptcy, the Company remains subject to
the jurisdiction of the Bankruptcy Court for matters relating to the
consummation of the Plan.



                                       9
<PAGE>   12



ITEM 2.     CHANGES IN SECURITIES AND USE OF PROCEEDS.

            (a) Not Applicable.

            (b) Not Applicable.

            (c) Not Applicable.

            (d) In connection with the Company's public offering of its
                Common Stock, without par value (the "Offering"), the Company
                filed a Registration Statement on Form S-1 (File No. 333-57447)
                whereby the Company registered shares of its common stock. The
                Registration Statement was declared effective by the Securities
                and Exchange Commission on July 30, 1998 (the "Effective
                Date"). The Offering commenced on July 31, 1998 and was
                terminated on August 12, 1998.  All of the shares registered in
                connection with the Offering have been sold. The managing
                underwriters for the Offering were McDonald & Company
                Securities, Inc., Warburg Dillon Read LLC and Johnson Rice &
                Company L.L.C.

                In connection with the Offering the Company issued 3,220,000
                shares (including the exercise of the underwriters
                over-allotment option) of its common stock to the public at a
                price of $22.00 per share. The Company received net proceeds
                from the Offering of $65,235,400 after deducting estimated
                expenses of $1,000,000.  Since the Effective Date, the Company  
                has repaid approximately $65,235,400 of indebtedness incurred   
                under the Credit Facilities.  Approximately $21.0 million of
                the indebtedness incurred under the Credit Facilities was in
                connection with the acquisition of Stone & Thomas and the
                remainder was incurred to fund the Company's obligations under
                the Plan and for general corporate purposes.

                The Credit Facilities contain a number of covenants, including, 
                among others, covenants restricting the Company with respect to
                the incurrence of additional indebtedness, capital expenditures,
                the ability to declare, pay or make dividends, distributions or
                other restricted payments, the creation of liens, the making of
                certain investments and loans, the consummation of certain
                transactions such as sales of substantial assets, mergers or
                consolidations and other transactions. The Company is also
                required to comply with certain financial tests and maintain
                certain financial ratios. Management believes that the Company
                will be able to comply with the covenants contained in the
                Credit Facilities and does not believe that compliance with
                these covenants will interfere with its business or the
                implementation of its growth strategy.

ITEM 3.     DEFAULTS UPON SENIOR SECURITIES.

            Not Applicable.

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

            Not Applicable.

ITEM 5.     OTHER INFORMATION.

            None.

ITEM 6.     EXHIBITS AND REPORTS ON FORM 8-K

       (a)  The following Exhibits are included in this Quarterly Report on
            Form 10-Q:


            2(a)   Third Amended Joint Plan of Reorganization of The
                   Elder-Beerman Stores Corp. and its Subsidiaries dated
                   November 17, 1997 (previously filed as Exhibit 2 to the
                   Company's Form 10 filed on November 26, 1997 (the "Form 10"),
                   and incorporated herein by reference)

            2(b)   Agreement and Plan of Merger by and Among The Elder-Beerman
                   Stores Corp., The Elder-Beerman Acquisition Corp. and Stone &
                   Thomas dated June 18, 1998 (previously filed as Exhibit 2(b)
                   to the Company's Registration Statement on Form S-1 (File
                   No. 333-57447) (the "Form S-1") and incorporated herein by
                   reference)

            2(c)   First Amendment to Agreement and Plan of Merger By and Among
                   The Elder-Beerman Stores Corp., The Elder-Beerman
                   Acquisition Corp. and Stone & Thomas dated July 27, 1998
                   (previously filed as Exhibit 2(c) to the Company's Form S-1
                   and incorporated herein by reference)

            3(a)   Amended Articles of Incorporation (previously filed as
                   Exhibit 3(a) to the Form 10-K filed on April 30, 1998 (the
                   "Form 10-K") and incorporated herein by reference)

            3(b)   Amended Code of Regulations (previously filed as Exhibit 3(b)
                   to the Form 10 and incorporated herein by reference)

            4(a)   Stock Certificate for Common Stock (previously filed as
                   Exhibit 4(a) to the Company's Form 10/A-1 filed on January
                   23, 1998 (the "Form 10/A-1") and incorporated herein by
                   reference)

            4(b)   Rights Agreement By and Between The Elder-Beerman Stores
                   Corp. and Norwest Bank Minnesota, N.A., dated as of December
                   30, 1997 (previously filed as Exhibit 4(c) to the Form 10-K
                   and incorporated herein by reference)

            4(c)   Warrant Agreement by and Between Beerman-Peal Holdings, Inc.
                   and the Elder-Beerman Stores Corp. for 249,809 shares of
                   Common Stock at a strike price of $12.80 per share dated
                   December 30, 1997 (previously filed as Exhibit 4(d) to the
                   Form 10-K and incorporated herein by reference)

            4(d)   Warrant Agreement by and Between Beerman-Peal Holdings, Inc.
                   and the Elder-Beerman Stores Corp. for 374,713 shares of
                   common stock at a strike price of $14.80 per share dated
                   December 30, 1997 (previously filed as Exhibit 4(e) to the
                   Form 10-K and incorporated herein by reference)



                                       10
<PAGE>   13



            10(a)  Amended and Restated Credit Agreement Among The Elder-Beerman
                   Stores Corp., The Lenders Party Thereto, Citibank, N.A. and
                   CitiCorp USA, Inc., dated as of July 27, 1998 (previously
                   filed as exhibit 10(b)(i) to the Company's Form S-1 and
                   incorporated herein by reference)

            10(b)  Amended and Restated Security Agreement Made By The
                   Elder-Beerman Stores Corp., The El-Bee Chargit Corp., The
                   Bee-Gee Shoe Corp. in Favor of CitiCorp USA, Inc., dated July
                   27, 1998 (previously filed as exhibit 10(b)(iv) to the
                   Company's Form S-1 and incorporated herein by reference)

            10(c)  Subsidiary Guaranty Made by Elder-Beerman West Virginia,
                   Inc., dated July 27, 1998 (previously filed as exhibit
                   10(b)(vii) to the Company's Form S-1 and incorporated herein
                   by reference)

            27     Financial Data Schedule

       (b)  No reports on Form 8-K were filed during the period.




                                       11
<PAGE>   14



                                   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.

                                              THE ELDER-BEERMAN STORES CORP.,
                                              an Ohio corporation


Dated:     September 15, 1998                 By:   /s/ JOHN A. MUSKOVICH
      ---------------------------                ---------------------------
                                                   John A. Muskovich
                                                   President, Chief Operating
                                                   Officer and Chief Financial
                                                   Officer (on behalf of the
                                                   Registrant and as Principal
                                                   Financial Officer)




                                       12
<PAGE>   15



                                  EXHIBIT INDEX



    Exhibit
    Number      Description of Exhibit
    -------     ----------------------

     2(a)       Third Amended Joint Plan of Reorganization of The Elder-Beerman
                Stores Corp. and its Subsidiaries dated November 17, 1997
                (previously filed as Exhibit 2 to the Company's Form 10 filed on
                November 26, 1997 (the "Form 10"), and incorporated herein by
                reference)

     2(b)       Agreement and Plan of Merger by and Among The Elder-Beerman
                Stores Corp., The Elder-Beerman Acquisition Corp. and Stone &
                Thomas dated June 18, 1998 (previously filed as Exhibit 2(b) to
                the Company's Registration Statement on Form S-1 (File No.
                333-57447) (the "Form S-1") and incorporated herein by
                reference)

     2(c)       First Amendment to Agreement and Plan of Merger By and Among The
                Elder-Beerman Stores Corp., The Elder-Beerman Acquisition Corp.
                and Stone & Thomas dated July 27, 1998 (previously filed as
                Exhibit 2(c) to the Company's Form S-1 and incorporated herein
                by reference)

     3(a)       Amended Articles of Incorporation (previously filed as Exhibit
                3(a) to the Form 10-K filed on April 30, 1998 (the "Form 10-K"),
                and incorporated herein by reference)

     3(b)       Amended Code of Regulations (previously filed as Exhibit 3(b) to
                the Form 10 and incorporated herein by reference)

     4(a)       Stock Certificate for Common Stock (previously filed as Exhibit
                4(a) to the Company's Form 10/A-1 filed on January 23, 1998 (the
                "Form 10/A-1") and incorporated herein by reference)

     4(b)       Rights Agreement By and Between The Elder-Beerman Stores Corp.
                and Norwest Bank Minnesota, N.A., dated as of December 30, 1997
                (previously filed as Exhibit 4(c) to the Form 10-K and
                incorporated herein by reference)

     4(c)       Warrant Agreement by and Between Beerman-Peal Holdings, Inc. and
                the Elder-Beerman Stores Corp. for 249,809 shares of Common
                Stock at a strike price of $12.80 per share dated December 30,
                1997 (previously filed as Exhibit 4(e) to the Form 10-K and
                incorporated herein by reference)

     4(d)       Warrant Agreement by and Between Beerman-Peal Holdings, Inc. and
                the Elder-Beerman Stores Corp. for 374,713 shares of Common
                Stock at a strike price of $14.80 per share dated December 30,
                1997 (previously filed as Exhibit 4(e) to the Form 10-K and
                incorporated herein by reference)

     10(a)      Amended and Restated Credit Agreement Among The Elder-Beerman
                Stores Corp., The Lenders Party Thereto, Citibank, N.A. and
                CitiCorp USA, Inc., dated as of July 27, 1998 (previously filed
                as exhibit 10(b)(i) to the Company's Form S-1 and incorporated
                herein by reference)

     10(b)      Amended and Restated Security Agreement Made By The
                Elder-Beerman Stores Corp., The El-Bee Chargit Corp., The
                Bee-Gee Shoe Corp. in Favor of CitiCorp USA, Inc., dated July
                27, 1998 (previously filed as exhibit 10(b)(iv) to the Company's
                Form S-1 and incorporated herein by reference)

     10(c)      Subsidiary Guaranty Made by Elder-Beerman West Virginia, Inc.,
                dated July 27, 1998 (previously filed as exhibit 10(b)(vii) to
                the Company's Form S-1 and incorporated herein by reference)

      27        Financial Data Schedule



                                       13