<PAGE>   1
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


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

   
                                   FORM 10-Q/A
    
[X]     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES 
        EXCHANGE ACT OF 1934

                FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1998

                                       OR

[ ]    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES 
       EXCHANGE ACT OF 1934

                        COMMISSION FILE NUMBER: 000-23747

                               GETTY IMAGES, INC.
             (Exact name of Registrant as specified in its charter)

         DELAWARE                                        98-0177556
 (State of Incorporation)                   (I.R.S. Employer Identification No.)


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

    2101 FOURTH AVENUE                                 101 BAYHAM STREET
        FIFTH FLOOR                                     LONDON, ENGLAND
 SEATTLE, WASHINGTON 98121                                  NW1 OAG
      (206) 695 3400                                 (011 44 171) 544 3456

   (Addresses, including zip code, and telephone numbers, including area code,
                         of principal executive offices)


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


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 twelve 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 ninety days. Yes x No

As of November 9, 1998, there were 30,549,189 shares of the Registrant's common
stock, par value $0.01 per share, outstanding.


<PAGE>   2
   
EXPLANATORY NOTE

        This Form 10-Q/A amends Items 1 and 2 of Part I, including the auditors
Report on Unaudited Interim Financial Information, of the Quarterly Report on
Form 10-Q for the quarter ended September 30, 1998, filed by the Registrant on
November 16, 1998. In that report, these items included filing agent errors
and are being replaced in their entirety by the items enclosed in this
amendment.
    
                                      1
<PAGE>   3



                               GETTY IMAGES, INC.

                       AMENDMENT NO. 1 TO QUARTERLY REPORT 
                                  ON FORM 10-Q
                                     FOR THE
                      THREE MONTHS ENDED SEPTEMBER 30, 1998

   
<TABLE>
<CAPTION>

                                                                                           PAGE

<S>                                                                                        <C>
PART I  -  FINANCIAL INFORMATION
     Item 1.  Consolidated Financial Statements                                             3
     Item 2.  Management's Discussion and Analysis of Financial Condition and
              Results of Operations                                                        17

              Signatures                                                                   30
</TABLE>
    
                                       2

<PAGE>   4




                                     PART I.
                              FINANCIAL INFORMATION


ITEM 1.  CONSOLIDATED FINANCIAL STATEMENTS

                               GETTY IMAGES, INC.
                 UNAUDITED CONSOLIDATED STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>

                                                          THREE MONTHS ENDED
                                                 -----------------------------------
                                                   SEPT 30, 1998    SEPT 30, 1997(1)
                                                         $                  $
                                                  (IN THOUSANDS)     (IN THOUSANDS)

<S>                                               <C>             <C>   
Sales                                                 48,975          26,542
Costs of sales                                        13,564           9,933
                                                     -------         -------
Gross profit                                          35,411          16,609
                                                     -------         -------
Selling, general and administrative expenses          25,646          11,618
Amortization of intangibles                           10,007             931
Depreciation                                           3,795           2,055
Non-recurring integration/restructuring costs          4,618              --
                                                     -------         -------
                                                      44,066          14,604
                                                     -------         -------

Operating (loss)/income                               (8,655)          2,005
Net interest (expense)/income                           (800)            296
Exchange(loss)/gain                                      (57)            135
                                                     -------         -------

(Loss)/income before income taxes                     (9,512)          2,436
Income taxes                                            (188)         (1,149)
                                                     -------         -------

Net (loss)/income                                     (9,700)          1,287
                                                     =======         =======

Basic (loss)/earnings per share (2)                  $ (0.32)        $  0.03
Diluted earnings per share (2)                           N/A         $  0.03
Basic earnings per ADS (2)                               N/A         $  0.07
Diluted earnings per ADS (2)                             N/A         $  0.07
</TABLE>


(1)     Reflects the unaudited consolidated statement of operations of Getty
        Communications plc (the predecessor company) for the quarter ended
        September 30, 1997.

(2)     The comparatives for the quarter ended September 30, 1997 reflect the
        share structure of Getty Communications plc (the predecessor company).
        Each American Depositary Share (ADS) represented two ordinary shares.


The accompanying notes are an integral part to these consolidated financial
statements.

                                       3
<PAGE>   5



                               GETTY IMAGES, INC.

                 UNAUDITED CONSOLIDATED STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>

                                                             NINE MONTHS ENDED
                                                    -----------------------------------
                                                    SEPT 30, 1998(1)   SEPT 30, 1997(2)
                                                            $                  $
                                                     (IN THOUSANDS)     (IN THOUSANDS)

<S>                                                  <C>               <C>   
Sales                                                     135,032           75,260
Costs of sales                                             39,080           28,270
                                                         --------         --------
Gross profit                                               95,952           46,990
                                                         --------         --------
Selling, general and administrative expenses               71,231           32,982
Amortization of intangibles                                26,911            2,280
Depreciation                                               10,240            5,678
Non-recurring integration and restructuring costs          13,755               --
                                                         --------         --------
                                                          122,137           40,940
                                                         --------         --------

Operating (loss)/income                                   (26,185)           6,050
Net interest (expense)/income                              (2,119)           1,078
Exchange loss                                                (116)            (177)
                                                         --------         --------

(Loss)/income before income taxes                         (28,420)           6,951
Income taxes                                                 (557)          (3,227)
                                                         --------         --------

Net (loss)/income before extraordinary items              (28,977)           3,724
Extraordinary items                                          (830)              --
                                                         --------         --------
Net (loss)/income                                         (29,807)           3,724
                                                         ========         ========

Basic (loss)/earnings per share (3)                      $  (1.04)        $   0.10
Diluted earnings per share (3)                                N/A         $   0.09
Basic earnings per ADS (3)                                    N/A         $   0.20
Diluted earnings per ADS (3)                                  N/A         $   0.19
</TABLE>


(1)     Reflects the combination of the unaudited consolidated statement of
        operations of Getty Communications plc (the predecessor company) for the
        period January 1, 1998 through February 9, 1998 and the unaudited
        consolidated statement of operations of Getty Images, Inc. for the
        period February 10, 1998 through September 30, 1998. See "Explanatory
        Note".

(2)     Reflects the unaudited consolidated statement of operations of Getty
        Communications plc (the predecessor company) for the nine month period
        ended September 30, 1997.

(3)     The comparatives for the nine month period ended September 30, 1997
        reflect the share structure of Getty Communications plc (the predecessor
        company). Each American Depository Share (ADS) represented two ordinary
        shares.



The accompanying notes are an integral part to these consolidated financial
statements.

                                       4
<PAGE>   6



                               GETTY IMAGES, INC.

                      UNAUDITED CONSOLIDATED BALANCE SHEET
<TABLE>
<CAPTION>

                                             SEPT 30, 1998      DECEMBER 31, 1997(1)
                                                     $                     $
                                              (IN THOUSANDS)        (IN THOUSANDS)
<S>                                          <C>                <C>   

                                     ASSETS

CURRENT ASSETS
        Cash and cash equivalents                   29,540           29,234
        Accounts receivable                         36,259           23,431
        Prepaid expenses and other assets           14,736            7,839
        Inventories                                  2,854               --
                                                  --------         --------

TOTAL CURRENT ASSETS                                83,389           60,504
Fixed assets, net                                   57,865           39,853
Intangible assets                                  332,679           66,870
Deferred assets                                      6,891            4,411
                                                  --------         --------

TOTAL ASSETS                                       480,824          171,638
                                                  ========         ========

                      LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES
        Accounts payable                            34,145           21,461
        Accrued expenses                            23,231           10,305
        Income taxes payable                         2,368            3,580
        Current portion of long-term debt              254            2,096
                                                  --------         --------

TOTAL CURRENT LIABILITIES                           59,998           37,442
Long term debt                                      72,173           14,657
                                                  --------         --------

TOTAL LIABILITIES                                  132,171           52,099
                                                  --------         --------

SHAREHOLDERS' EQUITY
        Common stock                                   299              608
        Additional paid-in capital                 365,815          108,049
        Retained (losses)/earnings                 (21,435)           8,124
        Cumulative translation adjustments           3,974            2,758
                                                  --------         --------

TOTAL SHAREHOLDERS' EQUITY                         348,653          119,539
                                                  --------         --------

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY         480,824          171,638
                                                  ========         ========
</TABLE>


(1)     Extracted from the audited consolidated balance sheet of Getty
        Communications plc (the predecessor company) at December 31, 1997.


The accompanying notes are an integral part to these consolidated financial
statements.

                                       5
<PAGE>   7



                               GETTY IMAGES, INC.

                      UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
<TABLE>
<CAPTION>

                                                                 NINE MONTHS ENDED
                                                        -----------------------------------
                                                        SEPT 30, 1998(1)   SEPT 30, 1997(2)
                                                                $                  $
                                                         (IN THOUSANDS)     (IN THOUSANDS)

<S>                                                      <C>             <C>   
Net cash flows from operating activities                        9,764           12,895
                                                             --------         --------

Cash flows from investing activities
        Business acquisitions, net of cash acquired           (78,667)         (21,563)
        Purchase of fixed assets                              (16,631)         (10,624)
                                                             --------         --------

Net cash used in investing activities                         (95,298)         (32,187)

Cash flows from financing activities
        Proceeds from debt                                    119,569               --
        Payments of principal balance of debt                 (67,098)          (3,285)
        Proceeds from issuance of ordinary shares              32,477               --
                                                             --------         --------

Net cash provided by/(used in) financing activities            84,948           (3,285)
                                                             --------         --------

Net decrease in cash and cash equivalents                        (586)         (22,577)
Exchange rate differences arising from translation of
foreign currency balances                                         892           (3,224)
Cash and cash equivalents
- beginning of period                                          29,234           58,938
                                                             --------         --------
- end of period                                                29,540           33,137
                                                             ========         ========
</TABLE>


(1)     Reflects the combination of the unaudited condensed consolidated
        statement of cash flows of Getty Communications plc (the predecessor
        company) for the period January 1, 1998 through February 9, 1998 and the
        unaudited condensed consolidated statement of cash flows of Getty
        Images, Inc. for the period February 10, 1998 through September 30,
        1998. See "Explanatory Note".

(2)     Reflects the unaudited condensed consolidated statement of cash flows of
        Getty Communications plc (the predecessor company) for the period ended
        September 30, 1997.


The accompanying notes are an integral part to these consolidated financial
statements.

                                       6
<PAGE>   8



                               GETTY IMAGES, INC.

                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)


EXPLANATORY NOTE

On February 9, 1998, the entire issued share capital of Getty Communications plc
("Getty Communications") was acquired via a Scheme of Arrangement by Getty
Images, Inc. ("Getty Images", the "Company" or the "Group"), a company
incorporated in Delaware and whose principal executive offices are located in
Seattle, Washington and London, England. Under the Scheme of Arrangement, each
issued Getty Communications Class B Ordinary Share was converted into one Getty
Communications Class A Ordinary Share and each holder of Getty Communications
Class A Ordinary Shares was issued one share of Getty Images Common Stock, par
value $0.01 ("Common Stock") for every two Getty Communications Class A Ordinary
Shares held.

The Scheme of Arrangement was accounted for as a transaction between entities
under common control, therefore purchase accounting was not applied.

On February 9, 1998, a wholly owned subsidiary of Getty Images merged with
PhotoDisc, Inc., a Washington corporation ("PhotoDisc"). The purchase
consideration was $244.6 million, including expenses, which included the issue
of 8,083,831 shares of Getty Images Common Stock, at a total market value of
$171.8 million.

On February 10, 1998, Getty Images purchased the entire issued and outstanding
share capital of Allsport Photographic plc, a public limited company organized
under the laws of England & Wales ("Allsport"). The purchase consideration was
$51.1 million, including expenses, which included the issue of 1,137,916 shares
of Getty Images Common Stock, at a total market value of $24.2 million.

Descriptions of these transactions were included in (i) the Current Report on
Form 8-K dated February 9, 1998 and the Current Report on Form 8-K dated
February 24, 1998 (as amended by the Amendment to Current Report on Form 8-K/A
dated April 27, 1998), filed with the Securities and Exchange Commission (the
"Commission") by Getty Images (collectively, the "Reports") and (ii) the
Registration Statement on Form S-4 (No.333-38777) that the Company filed with
the Commission (as amended, the "Registration Statement") in connection with the
meetings of shareholders of Getty Communications and the special meetings of the
shareholders of PhotoDisc that were required to approve the transactions and the
offering of securities in connection therewith.

                                       7

<PAGE>   9



                               GETTY IMAGES, INC.

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)


As a result of such transactions, Getty Images became the successor to Getty
Communications. Trading in Getty Communications American Depository Shares
("ADSs") on the Nasdaq National Market (NASDAQ-GETTY) terminated on February 9,
1998 and trading subsequently commenced in shares of Getty Images Common Stock
on the Nasdaq National Market (NASDAQ-GETY). Registration of the Getty
Communications Ordinary Shares and ADSs under the Securities Exchange Act of
1934, as amended, has been terminated.

Also as described in the Reports, on February 9, 1998, Getty Investments L.L.C.
("Getty Investments") completed a subscription for 1,518,644 shares of Getty
Images Common Stock at a purchase price of $18.4375 per share or an aggregate of
$28 million (the "Getty Investments Subscription").

1.       BASIS OF PREPARATION

The unaudited consolidated financial statements presented herein have been
prepared in accordance with the instructions to Form 10-Q and do not include all
the information and note disclosures required by generally accepted accounting
principles. The statements should be read in conjunction with the consolidated
financial statements and notes thereto included in the Company's Annual Report
on Form 10-K for the year ended December 31, 1997 (the "Annual Report"),
Commission file No. 000-23747, that was filed with the Commission on March 31,
1998 (as amended by the Company's Reports on Form 10-K/A that were filed with
the Commission on April 28,1998 and August 19, 1998, respectively). In the
opinion of management, the accompanying consolidated financial statements
include all adjustments (consisting only of normal recurring adjustments)
necessary to present fairly the Company's financial position and results of
operations. The results of the operations for the nine and three month periods
ended September 30, 1998 may not be indicative of the results that may be
expected for the full fiscal year.

        RECENTLY ISSUED ACCOUNTING STANDARDS

SFAS No. 131
In July 1997, the Financial Accounting Standards Board ("FASB") issued SFAS
No. 131, Disclosures About Segments of Enterprise and Related Information. SFAS
No. 131 requires certain financial and supplementary information to be disclosed
on an annual and interim basis for each reportable segment of an enterprise.
SFAS No. 131 is effective for fiscal years beginning after December 15, 1997,
but interim reporting is not required until interim periods beginning after
December 15, 1998. Unless impracticable, companies would be required to restate
prior period information upon adoption. Management does not expect the adoption
of this standard to have a material impact on the Company and its operations.

                                       8
<PAGE>   10



                               GETTY IMAGES, INC.

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)

SOP 98-1
SOP 98-1 "Accounting for the Costs of Computer Software Developed or Obtained
for Internal Use" was issued in March 1998 and is effective for financial
statements for periods beginning after December 15, 1998. This statement
identifies the characteristics of internal-use software and provides guidance on
when costs incurred for internal use computer software are and are not
capitalized. Costs incurred prior to initial application will not be
retrospectively adjusted to comply with the provision of this SOP. The Company,
as permitted by SOP 98-1, has applied its provisions in the three month period
ended September 30, 1998 in respect of the nine month period ended September 30,
1998. No material adjustments arose in respect of the six month period ended
June 30, 1998.

2.      PRINCIPLES OF CONSOLIDATION

The accompanying consolidated financial statements include Getty Images, Inc.
and its subsidiaries, all of which are 100% owned, from the date of acquisition.
All material intercompany amounts and transactions have been eliminated in the
consolidated financial statements.

3.      NON-RECURRING INTEGRATION AND RESTRUCTURING COSTS

During the nine month period ended September 30, 1998, the Company approved and
commenced its program to integrate the businesses of the Group following the
acquisitions of PhotoDisc and Allsport in February 1998. This has resulted in
integration and restructuring charges, which are incremental and non-recurring,
being incurred.

Integration costs in the nine month and three month periods ended September 30,
1998 amounted to $3.7 million and $2.4 million, respectively, and are associated
with the activities of teams responsible for integrating the various businesses
of the Group for the benefit of future operations and include items such as
consulting and professional fees, systems and process integration costs and
contract renegotiation costs. These costs are expensed as incurred.

The provision for restructuring costs, amounting to $10.1 million and $2.2
million in the nine month and three month periods ended September 30, 1998,
respectively, is for estimated exit costs associated with the closure of certain
facilities operated by the Group, including property related exit costs and
asset writedowns, and termination costs, including agents and photographer
contracts and employees.

                                       9
<PAGE>   11



                               GETTY IMAGES, INC.

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)


Non-recurring integration and restructuring costs have been incurred as follows:
   
<TABLE>
<CAPTION>
                                               Three Months ended       Nine Months ended
                                               September 30, 1998      September 30, 1998
                                               ------------------      ------------------
                                                ($ IN THOUSANDS)        ($ IN THOUSANDS)
<S>                                            <C>                     <C>
Provision at June 30, 1998/December 31, 1997          5,447                       --        
Total charges                                         4,618                    13,755
Cash expenditure                                     (2,812)                   (3,065)
Non-cash write offs                                      --                    (2,933)
Non-cash write back                                     504                        --
                                                      -----                    ------
Provision at September 30, 1998                       7,757                     7,757

</TABLE>
    
The balance at September 30, 1998 relates principally to employee termination,
premises closure, termination of agents and photographer contracts and
integration of business systems costs, a significant portion of which will be
paid in the remainder of 1998, although the integration and restructuring
program will continue into 1999.

4.      EXTRAORDINARY ITEMS

On May 20, 1998, the Company completed the issue of $75 million, 4.75%
convertible subordinated notes, the proceeds of which were applied partially to
the repayment of $49 million of term debt due to Midland Bank plc. The early
payment of such debt resulted in an extraordinary charge of $830,000 ($0.03 per
share) consisting of the following:
<TABLE>
<CAPTION>

                                                ($ IN THOUSANDS)

<S>                                                   <C>  
Write off of unamortized loan costs                   1,238
Income tax benefit                                     (408)

                                                     ------
                                                        830
                                                     ======
</TABLE>

5.      PROVISION FOR INCOME TAXES

In accordance with generally accepted accounting principles, the Company
provides for income taxes on an interim basis using its estimated annual income
tax rate. The Company is providing for income taxes in 1998 at an effective tax
rate of 36.8% of net income before amortization of goodwill, non-recurring
integration and restructuring costs and extraordinary items. The comparative
rate for the year ended December 31, 1997 was 35.4%.


                                       10
<PAGE>   12



                               GETTY IMAGES, INC.

                     NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)



6.      EARNINGS PER SHARE

Basic and diluted earnings per share (EPS) are computed in accordance with FAS
No. 128, "Earnings per Share", which is effective for fiscal periods ending
after December 15, 1997. Prior periods have been restated to conform with the
provisions of this standard.

Diluted earnings per share are not given for the nine month and three month
periods ended September 30, 1998 due to the loss incurred in those periods.
Basic loss per share for the nine month and three month periods ended September
30, 1998 are computed on the basis of weighted average number of shares in issue
respectively.

The numerators and denominators of the basic and diluted per share computations
are reconciled below:
<TABLE>
<CAPTION>

                            THREE MONTHS ENDED SEPT 30, 1997       THREE MONTHS ENDED SEPT 30, 1998
                         -------------------------------------   ---------------------------------------
                              INCOME                     PER        INCOME                          PER
                           (NUMERATOR)      SHARES      SHARE    (NUMERATOR)        SHARES         SHARE
                                $        (DENOMINATOR)  AMOUNT        $          (DENOMINATOR)    AMOUNT
                         (IN THOUSANDS) (IN THOUSANDS)    $      (IN THOUSANDS)   (IN THOUSANDS)     $
                          

<S>                       <C>           <C>             <C>       <C>             <C>              <C>   
BASIC EPS
Income available to
common stockholders            1,287        38,149        0.03         (9,700)           30,467        (0.32)

EFFECT OF DILUTIVE SHARES
Share options                     --         1,250                          --               N/A
                           ---------     ---------     -------       ---------    --------------      ------

DILUTED EPS
Income available to
common stockholders and
assumed option exercises       1,287        39,399        0.03             N/A               N/A         N/A
                           =========     =========     =======        ========    ==============      ======
</TABLE>

   
<TABLE>
<CAPTION>

                             NINE MONTHS ENDED SEPT 30, 1997          NINE MONTHS ENDED SEPT 30, 1998
                           -----------------------------------   ------------------------------------------
                              INCOME                     PER        INCOME                            PER
                           (NUMERATOR)      SHARES      SHARE    (NUMERATOR)        SHARES           SHARE
                                $        (DENOMINATOR)  AMOUNT        $          (DENOMINATOR)       AMOUNT
                         (IN THOUSANDS) (IN THOUSANDS)    $      (IN THOUSANDS)   (IN THOUSANDS)       $
                          

<S>                       <C>           <C>             <C>       <C>             <C>               <C>   
BASIC EPS
Income available to
common stockholders            3,724        37,768        0.10        (29,807)           28,686       (1.04)

EFFECT OF DILUTIVE SHARES
Share options                      -         1,472                          --             N/A
                           ---------     ---------     -------       ---------    -------------       ------

DILUTED EPS
Income available to
common stockholders and
assumed option exercises       3,724        39,240        0.09             N/A               N/A         N/A
                           =========     =========     =======        ========    ==============      ======
</TABLE>
    

                                       11
<PAGE>   13



                               GETTY IMAGES, INC.

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)


7.      ACQUISITIONS

PhotoDisc
On February 9, 1998, a wholly owned subsidiary of Getty Images merged with
PhotoDisc. The purchase consideration was $244.6 million including expenses,
which included the issue of 8,083,831 shares of Getty Images Common Stock, at a
total market value of $171.8 million.
<TABLE>
<CAPTION>

                                                                                        $
                                                                                  (IN THOUSANDS)

<S>                                                                               <C>   
PURCHASE PRICE OF PHOTODISC

Cash consideration to holders of PhotoDisc Common Stock and Series A
  Preferred Stock                                                                       34,076
Getty Images' transaction expenses                                                       9,000
                                                                                      --------
Cash costs of the acquisition                                                           43,076

Stock consideration - Shares of Getty Images Common Stock issued
  (8,083,831 @ $21.25)                                                                 171,781
Fair value of options  over shares of  PhotoDisc  Common  Stock  converted  to
options over shares of Getty Images Common Stock                                        29,701
                                                                                      --------
Total purchase price                                                                   244,558
PhotoDisc net assets at February 9, 1998                                                (3,666)
                                                                                      --------

Excess of purchase price over net assets acquired                                      240,892
                                                                                      ========

Amount allocated to specific intangibles (amortized over 2 to 3 years)                  46,387
Amount allocated to goodwill (amortized over 20 years)                                 194,505
                                                                                      --------
                                                                                       240,892
                                                                                      ========
</TABLE>

The net assets acquired at February 9, 1998 have been adjusted downwards by
$1.550 million in the three months ended September 30, 1998 as a result of fair
value adjustments calculated in accordance with APB 16.

                                       12

<PAGE>   14



                               GETTY IMAGES, INC.

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)


Allsport
On February 10, 1998 Getty Images purchased the entire issued share capital of
Allsport. The purchase consideration was $51.1 million, including expenses,
which included the issue of 1,137,916 shares of Getty Images Common Stock at a
total market value of $24.2 million.
<TABLE>
<CAPTION>

                                                                                        $
                                                                                  (IN THOUSANDS)

<S>                                                                               <C>   
PURCHASE PRICE OF ALLSPORT

Cash consideration to holders of Allsport Ordinary Shares at closing                   26,998
Getty Images' transaction expenses                                                        900
                                                                                      -------
Cash costs of the acquisition                                                          27,898

Stock consideration - Shares of Getty Images Common Stock issued
  (691,899 @ $21.25) (1)                                                               14,703
Fair value of options for Allsport Ordinary Shares,  which shares were held by
an Employee  Benefit  Trust,  converted to options over shares of Getty Images
Common Stock(1)                                                                         8,511
                                                                                      -------
Total purchase price                                                                   51,112
Allsport net assets at February 10, 1998                                                 (631)
                                                                                      -------

Excess of purchase price over net assets acquired                                      50,481
                                                                                      =======

Amount allocated to specific intangibles (amortized over 1 to 3 years)                  4,571
Amount allocated to goodwill (amortized over 20 years)                                 45,910
                                                                                      -------
                                                                                       50,481
                                                                                      =======
</TABLE>


(1)     Of the stock consideration of 1,137,916 shares of Getty Images Common
        Stock, 446,017 were issued to an Employee Benefit Trust established on
        behalf of certain employees of Allsport. Such shares of Getty Images
        Common Stock have not been valued for the purpose of calculating the
        stock consideration, but the underlying options over Allsport Ordinary
        Shares, which converted into options over shares of Getty Images Common
        Stock, have been valued by reference to the Black-Scholes option pricing
        model.


                                       13

<PAGE>   15



                               GETTY IMAGES, INC.

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)


8.      ADDITIONAL PAID IN CAPITAL

Additional paid in capital includes the following adjustments relating to the
conversion of options for shares of PhotoDisc Common Stock and Allsport Ordinary
Shares into options for shares of Getty Images Common Stock and the acquisition
of the entire issued share capital of Getty Communications.
<TABLE>
<CAPTION>

                                                                                        $
                                                                                  (IN THOUSANDS)

<S>                                                                                <C>  
Fair value of options for Allsport Ordinary Shares less market value of Getty
Images Common Stock issued to the Employee Benefit Trust                                  (967)
Elimination of Getty Communications Ordinary Shares at par, net of the
conversion to shares of Getty Images Common Stock                                          416

   
Elimination of additional paid-in capital of Getty Communications                      108,049
Fair value of options over shares of PhotoDisc Common Stock converted to
options over shares of Getty Images Common Stock                                        29,701
                                                                                      --------
                                                                                       137,199
                                                                                      ========
</TABLE>
9.      REFINANCING
    

On May 20, 1998, the Company completed the issue of $75 million convertible
subordinated notes. These notes carry a coupon of 4.75% and are convertible into
2.6 million shares of Common Stock of the Company. These notes are general
unsecured subordinated obligations of the Company. The funds raised were applied
to the repayment of $49 million of term debt, of which $17 million existed at
December 31, 1997.

10.     STOCK OPTIONS

Under the Scheme of Arrangement, the existing stock options granted by Getty
Communications were vested immediately, with the right to exercise the options
for a period of three months from February 17, 1998, which was subject to
extension at the discretion of the Company. As an alternative to exercising
options, option holders had the right to exchange their existing options for
Getty Communications Class A Ordinary Shares for new options for Getty Images
Common Stock at a ratio of 2 for 1. As of September 30, 1998, all of the options
for Getty Communications Class A Ordinary Shares have either been exchanged for
new options for Getty Images Common Stock or exercised.

Pursuant to the acquisition of PhotoDisc, 1.8 million options for Getty Images
Common Stock were granted to existing holders of options for PhotoDisc Common
Stock.

                                       14

<PAGE>   16

                               GETTY IMAGES, INC.

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)

   
On February 9, 1998, Getty Images granted 3.1 million options to acquire Getty
Images Common Stock at $20.91 per share. Further options were granted on April
1, June 2, August 31 and September 8, 1998 of 81,000 at $25.88, 255,000 at
$19.22, 199,000 at $15.32 and 524,500 at $14.94, respectively. These options are
exercisable within one to ten years from the date of grant.

11.      PRO FORMA INFORMATION RELATING TO ACQUISITIONS (UNAUDITED)

The following unaudited pro forma information shows the results of the Company
for the nine month periods ended September 30, 1998 and September 30, 1997,
respectively, as if the acquisitions of PhotoDisc and Allsport had occurred on
January 1, 1997. The pro forma information includes adjustments related to the
financing of the acquisitions, the effect of amortizing goodwill and other
intangible assets acquired, as well as the related tax effects. The pro forma
results of operations are unaudited, have been prepared for comparative purposes
only and do not purport to indicate the results of operations which would
actually have occurred had the combinations been in effect on the dates
indicated or which may occur in the future.
    
<TABLE>
<CAPTION>

                                                 UNAUDITED
                                      Nine Months Ended September 30
                                    ----------------------------------
                                          1998               1997
                                           $                   $
                                      (IN THOUSANDS      (IN THOUSANDS
                                     EXCEPT NET LOSS    EXCEPT NET LOSS
                                       PER SHARE)          PER SHARE)
<S>                                 <C>                 <C>    
Sales                                   141,824             105,578
Net Loss                                (33,066)             (2,393)
Net loss per share ($)                    (1.15)              (0.09)

</TABLE>



                                       15

<PAGE>   17
REPORT ON UNAUDITED INTERIM FINANCIAL INFORMATION

To the Board of Directors of Getty Images, Inc.

We have reviewed the accompanying interim consolidated financial statements of
Getty Images, Inc. and subsidiaries as of September 30, 1998, and for the
three-month and nine-month period then ended as set out on pages 3 to 15. These
interim financial statements are the responsibility of the company's management.
   
We conducted our review in accordance with standards established by the American
Institute of Certified Public Accountants. A review of interim financial
information consists principally of applying analytical procedures to financial
data and making inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit conducted in accordance
with generally accepted auditing standards, the objective of which is the
expression of an opinion regarding the financial statements taken as a whole.
Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material modifications that should
be made to the accompanying interim financial statements for them to be in
conformity with generally accepted accounting principles.
    
PricewaterhouseCoopers
Chartered Accountants
LONDON
England

November 16, 1998

                                      16
<PAGE>   18
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.

THE FOLLOWING SHOULD BE READ IN CONJUNCTION WITH THE UNAUDITED CONSOLIDATED
FINANCIAL STATEMENTS OF GETTY IMAGES, INC. AND THE NOTES THERETO, AND OTHER
FINANCIAL INFORMATION CONTAINED ELSEWHERE IN THIS REPORT ON FORM 10-Q.

THE STATEMENTS IN THIS SECTION THAT ARE NOT HISTORICAL FACTS ARE FORWARD-LOOKING
STATEMENTS WITHIN THE MEANING OF SECTION 27A OF THE SECURITIES ACT OF 1933, AS
AMENDED, AND SECTION 27E OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED,
THAT INVOLVE RISKS AND UNCERTAINTIES, SUCH AS STATEMENTS OF THE COMPANY'S PLANS,
OBJECTIVES, EXPECTATIONS AND INTENTIONS. THE CAUTIONARY STATEMENTS MADE IN THIS
QUARTERLY REPORT SHOULD BE READ AS BEING APPLICABLE TO ALL RELATED
FORWARD-LOOKING STATEMENTS AS A RESULT OF A VARIETY OF FACTORS, INCLUDING THOSE
SET FORTH UNDER "ITEM 1: BUSINESS -- H. BUSINESS RISK FACTORS" IN THE ANNUAL
REPORT.

THE FOLLOWING DISCUSSION INCORPORATES THE POST-MERGER AND POST-ACQUISITION
RESULTS OF PHOTODISC AND ALLSPORT, WHICH WERE ACQUIRED BY GETTY IMAGES ON
FEBRUARY 9, 1998 AND FEBRUARY 10, 1998, RESPECTIVELY.

OVERVIEW

Getty Images commenced operations on February 9, 1998 following the Scheme of
Arrangement with Getty Communications and the acquisition of PhotoDisc. On
February 10, 1998 the Company acquired Allsport.

Getty Images' sales are primarily derived from the marketing of image
reproduction and broadcasting rights to a range of business customers. Sales
generally comprise a large number of relatively small transactions involving the
sale either of single images, video and film clips or of CD-ROM products
containing between 100 and 300 images. Getty Images utilizes a variety of
digital and analog distribution platforms, including electronic commerce via the
Internet, CD-ROMS, 35mm film, video and traditional analog transparencies.
Prices are determined by the extent of rights granted over the use of the image
or clip and can vary significantly across geographic markets and customer
groups. Sales are also generated from subscription or bulk purchase deals where
customers are provided access to imagery on-line.
   
Regionally, all of our markets showed strong growth in sales, with the
exception of Japan and South East Asia. Although Getty Images adjusted growth
expectations for the fourth quarter of 1998 and for the 1999 fiscal year, all
the major businesses of Getty Images reported growth compared with equivalent
periods of 1997.
    

                                       17
<PAGE>   19



Getty Images' cost of sales consists primarily of payments to contributing
photographers and cinematographers. These suppliers are under contract to the
Company and receive payments of up to 50% of sales depending on the product sold
and the location of the sale. Minimal payments are due for sales of Hulton
Getty's and Allsport's imagery as sales of most of the images in these
collections do not require commission payments. This is also the case with
approximately 25% of the footage at Energy Film Library. Also included in cost
of sales is the cost of CD-ROM production at PhotoDisc. 

Getty Images' selling, general and administrative expenses include salaries and
related staff costs, premises and utility costs and marketing and catalog costs.
These costs have increased recently, largely as a result of acquisitions and
also to support the growth of the business. In the case of Allsport, staff costs
include salaries of photographers who are employed directly by the Company.

Getty Images amortizes goodwill and other intangibles and depreciates the cost
of the investment in duplicate transparencies, digital files, the archival
picture collection, computer systems and other fixed assets over their expected
useful lives. The acquisition of PhotoDisc and Allsport generated $240 million
of goodwill that will be amortized over twenty years and $51 million of other
intangibles that will be amortized over periods varying from one to three years.

As a result of Getty Images' various acquisitions and their consequential
financial and accounting effects on net income, Getty Images believes that
EBITDA provides investors and analysts with an appropriate measure of the
operating performance of Getty Images. Getty Images defines EBITDA as earnings
before interest, taxes, exchange gains/(losses), depreciation, amortization,
non-recurring integration and restructuring costs and extraordinary costs.

The Company experienced an increase in the rate of demand for the digital, as
opposed to analog, search, selection and fulfillment of imagery during 1997 and
the first three quarters of 1998, particularly in North America, and believes
this trend will continue, especially in more developed markets. As a result, the
Company intends to increase the rate of capital expenditure on digitization in
the remainder of 1998 and 1999, building on the significant investment made in
1997.

At the same time, the Company is integrating various parts of the business
following the acquisitions of PhotoDisc and Allsport. Non-recurring integration
and restructuring costs of $13.8 million and $4.6 million have been incurred in
the nine month and three month periods ended September 30, 1998, respectively.
These charges cover non-recurring integration and restructuring costs arising
from the acquisitions of PhotoDisc and Allsport and their integration and the
related reorganization and restructuring of the Company's businesses. The
Company also incurred an extraordinary charge of $0.8 million relating to the
early payment of $49 million of bank debt.



                                       18
<PAGE>   20



BASIS OF PRESENTATION

Getty Images reports in U.S. dollars. Getty Communications previously reported
in pounds sterling. To facilitate comparison of the results of Getty Images with
the historical results of Getty Communications, the historical results of Getty
Communications have been translated into U.S. dollars using the exchange rates
set out below.

Noon Buying rates for pounds sterling expressed in U.S. dollars per pound
sterling:

        Average for nine month period ended September 30, 1997:      1.6291
        Period end rate at September 30, 1997:                       1.6154
        Average for nine month period ended September 30, 1998:      1.6590
        Period end rate of September 30, 1998                        1.6994


                                       19
<PAGE>   21


<TABLE>
<CAPTION>

UNAUDITED RESULTS OF OPERATIONS:

                                                          NINE MONTHS ENDED SEPT 30
                                               ----------------------------------------------------
                                                              % OF                        % OF
                                                1997      NET REVENUES      1998      NET REVENUES
                                                      (IN THOUSANDS, EXCEPT PERCENTAGES)

<S>                                            <C>           <C>          <C>             <C>  
INCOME STATEMENT DATA:
Sales                                          75,260         100.0%       135,032         100.0%
Gross profit                                   46,990          62.4%        95,952          71.1%
Non-recurring integration and                      --            --        (13,755)        (10.2%)
restructuring costs
Amortization and depreciation                  (7,958)        (10.6%)      (37,151)        (27.5%)
Operating income/(loss)                         6,050           8.0%       (26,185)        (19.4%)
Net interest income/(expense)                   1,078           1.4%        (2,119)         (1.6%)
Extraordinary items                                --            --           (830)         (0.6%)
Net income/(loss)                               3,724           4.9%       (29,807)        (22.1%)

OPERATING DATA:
EBITDA(1)                                      14,008          18.6%        24,721          18.3%
</TABLE>

<TABLE>
<CAPTION>

                                                          THREE MONTHS ENDED SEPT 30
                                                -------------------------------------------------
                                                              % OF                       % OF
                                                1997      NET REVENUES     1998      NET REVENUES
                                                      (IN THOUSANDS, EXCEPT PERCENTAGES)

<S>                                             <C>            <C>         <C>           <C>   
INCOME STATEMENT DATA:
Sales                                           26,542         100.0%      48,975        100.0%
Gross profit                                    16,609          62.6%      35,411         72.3%
Non-recurring integration and                       --            --       (4,618)        (9.4%)
restructuring costs
Amortization and depreciation                   (2,986)        (11.3%)    (13,802)       (28.2%)
Operating income/(loss)                          2,005           7.6%      (8,655)       (17.7%)
Net interest income/(expense)                      296           1.1%        (800)        (1.6%)
Net income/(loss)                                1,287           4.8%      (9,700)       (19.8%)

OPERATING DATA:
EBITDA(1)                                        4,991          18.8%       9,765         19.9%
</TABLE>



(1)     "EBITDA" is defined as earnings before interest, taxes, exchange
        gains/(losses), depreciation, amortization, non-recurring integration
        and restructuring costs and extraordinary costs. EBITDA should not be
        considered as an alternative to operating income as an indicator of
        Getty Image's operating performance or to cash flows as a measure of
        Getty Images' liquidity.

                                       20
<PAGE>   22



SALES

Getty Images' sales increased from $75.2 million in the nine month period ended
September 30, 1997 to $135.0 million in the nine month period ended September
30, 1998, an increase of 80%, and from $26.5 million in the three month period
ended September 30, 1997 to $49.0 million in the three month period ended
September 30, 1998, an increase of 85%. The increase was attributable mainly to
$50.6 million and $20.3 million in sales in the nine month and three month
periods ended September 30, 1998, respectively, following the acquisitions in
February 1998 of PhotoDisc and Allsport.

Growth has been achieved in North America and Europe of 19% and 21% on a
proforma basis. Within North America this growth has been achieved through web
sales, while in Europe, sales via the web, of CD ROMS and from transparencies
have all been strong. Sales in South East Asia, particularly Japan, have been
disappointing and are expected to remain weak until the local economies recover.

Although Getty Images adjusted its growth expectations for the fourth quarter of
1998 and for the 1999 fiscal year, all the major businesses of Getty Images
reported growth compared with the equivalent periods of 1997:

Tony Stone Images performed well in the nine month and three month periods ended
September 30, 1998, with growth generated by increases in both volume and price.
Growth was strong in the advertising and magazine publishing markets and within
Europe. Volume growth was the result of a combination of initiatives, including
focused sales development programs, the continued success of the catalogs and
the introduction of new technology that allows customers to review selections
over the web rather than waiting for duplicate transparencies.

PhotoDisc on-line sales of $14.2 million and $5.7 million in the nine month and
three month periods ended September 30, 1998, represented growth of 198% and
166%, respectively, over the equivalent periods of 1997. This growth was
achieved in all the key geographical markets of Getty Images. On-line sales
growth is expected to continue with the launch of the Tony Stone Images full
e-commerce website on October 12, 1998.

                                       21

<PAGE>   23



Allsport's sales growth in the quarter was driven by a number of major sporting
events in the period, particularly the Commonwealth Games in Malaysia and the
culmination of the baseball season.

COST OF SALES

Getty Images' cost of sales, which largely comprises amounts payable to
contributing photographers and cinematographers, increased from $28.3 million in
the nine month period ended September 30, 1997 to $39.1 million in the nine
month period ended September 30, 1998 and from $9.9 million in the three month
period ended September 30, 1997 to $13.6 million in the three month period ended
September 30, 1998. As a percentage of sales, cost of sales declined from 38% in
the nine month period ended September 30, 1997 to 29% in the nine month period
ended September 30, 1998 and from 37% in the three month period ended September
30, 1997 to 28% in the three month period ended September 30, 1998.

The reduction in cost of sales as a percentage of sales primarily reflected the
higher proportion of sales of owned imagery following the Allsport acquisition
and the lower cost of sales at PhotoDisc. At Allsport, a substantial part of the
image collection does not give rise to payments to photographers. A similar
situation exists with respect to most of Hulton Getty's imagery and
approximately 25% of Energy Film Library's footage. In line with the Company's
strategy of increasing its sales of wholly owned content, the proportion of
sales of wholly owned imagery increased from approximately 9% in the three month
period ended September 30, 1997 to approximately 19% in the three month period
ended September 30, 1998.

In Tony Stone Images, new contracts with contributing photographers have been
endorsed by the Photographers' Advisory Groups, consultative but non-binding
groups of US and European contributing photographers. Tony Stone Images has now
signed contracts with an overwhelming majority of the contributing photographers
represented in its core collection. The new contract includes a new rate payable
to photographers for on-line sales: 40% for in-territory sales and 30% for
out-of-territory sales, which compares to the rate for analog sales of 50% for
in-territory sales and 30% for out-of-territory sales. Management expects this
agreement to improve gross margin as a higher proportion of sales moves to the
web.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

Getty Images' selling, general and administrative expenses increased from $33.0
million in the nine month period ended September 30, 1997 to $71.2 million in
the nine month period ended September 30, 1998 and from $11.6 million in the
three month period ended September 30, 1997 to $25.6 million in the three month
period ended September 30, 1998. As a percentage of sales, selling, general and
administrative expenses increased from 43.8% in the nine month period ended
September 30, 1997 to 52.7% in the nine month period ended September 30, 1998
and from 43.7% in the three month period ended September 30, 1997 to 52.4% in
the three month period ended September 30, 1998.

                                       22
<PAGE>   24



The increase in selling, general and administrative expenses as a percentage of
sales was mainly attributable to the inclusion of PhotoDisc and Allsport. These
businesses have substantially higher selling, general and administrative
expenses than the existing businesses. The application of the Getty Images' cost
management disciplines has resulted in significant improvement in PhotoDisc's
margin. PhotoDisc's selling, general and administrative expenses have been
reduced as a percentage of sales from 60% in the three months ended September
30, 1997 to under 50% in the three months ended September 30, 1998.

Excluding PhotoDisc and Allsport, selling, general and administrative expenses
increased as a percentage of sales principally as a result of investments in
management and new business systems, including web development. Management
expects to continue to invest in these areas through 1999. Benefits have started
to be realized within Tony Stone Images on "Compass", the advanced internal
search and selection software, and "Client Preview" which allows customers to
review the results of a Compass search through the web. Further benefits are
expected as a result of Tony Stone Images website, which was launched on October
12, 1998.

AMORTIZATION OF INTANGIBLES

Amortization of intangibles was $26.9 million and $10.0 million in the nine
month and three month periods ended September 30, 1998, respectively, compared
to $2.3 million and $0.9 million in the nine month and three month periods ended
September 30, 1997, respectively. The increases in amortization arise from the
inclusion of amortization relating to the acquisitions of PhotoDisc and
Allsport. Intangibles of $240.9 million and $50.5 million, respectively, arose
on consolidation of these acquisitions. A substantial part of these intangibles,
$240.4 million, has been attributed to goodwill which is being amortized over 20
years. Other intangibles of $50.9 million are being amortized over periods
varying from one to three years.

DEPRECIATION

Depreciation increased from $5.7 million and $2.1 million in the nine month and
three month periods ended September 30, 1997, respectively, to $10.2 million and
$3.8 million in the nine month and three month periods ended September 30, 1998,
respectively. These increases primarily arose from the acquisitions, together
with continued investment in capital expenditure. The merger with PhotoDisc has
provided the opportunity to accelerate Getty Images' digital strategy.
Management anticipates capital expenditures will be approximately $26 million in
1998 and $32 million in 1999. Depreciation charges are therefore expected to
increase in the short and medium term.

                                       23
<PAGE>   25



NON-RECURRING INTEGRATION AND RESTRUCTURING COSTS

During the nine month period ended September 30, 1998, Getty Images approved and
commenced its program to integrate the businesses of the Group. This has
resulted in non-recurring integration and restructuring costs of $13.8 million
in the nine months ended September 30, 1998 and $4.6 million in the three months
ended September 30, 1998.

Integration costs in the nine month and three month periods ended September 30,
1998 were $3.7 million and $2.4 million, respectively, and were associated with
the activities of teams responsible for integrating the various businesses of
the Group for the benefit of future operations and include items such as
consulting and professional fees, systems and process integration costs and
contract renegotiation costs.
   
The provision for restructuring costs, amounting to $10.1 million in the nine
month period ended September 30, 1998 and $2.2 million in the three month period
ended September 30, 1998 was for estimated exit costs associated with the
closure of certain facilities operated by the Group, including asset writedowns
and termination costs. The largest element of the asset writedowns comprised
systems assets, namely hardware and software, which have shortened lives as a
result of the restructuring plans. The termination costs arose in relation to
property related exit costs, termination of agents and photographer contracts
and employee terminations. The property related costs arose from the
consolidation of offices where the Group had multiple sites in one location.
Termination of agent and photographer contracts related to professional and
administrative fees resulting from a review of existing contractual agreements.
Costs associated with employees related primarily to the resignation of Mark
Torrance as Co-Chairman of the Company. Mr. Torrance assumed the new position of
non-executive Vice-Chairman. Management changes in the nine month period include
the appointment of Don Smith as the Managing Director of Tony Stone Images;
Stephen Warshaw, Managing Director of Tony Stone Images, has left the Company;
Bob Chamberlain, Co-President of PhotoDisc, has also left the Company; Sally von
Bargen remains as President of PhotoDisc.
    
It is anticipated that a significant portion of the non-recurring integration
and restructuring costs will be completed by December 31, 1998, but the
integration and restructuring program will continue into 1999. Management
expects that the total cash expenditure will amount to approximately $10.8
million for the entire non-recurring integration and restructuring
program.

NET INTEREST INCOME/(EXPENSE)

Net interest expense was $2.1 million and $800,000 in the nine month and three
month periods ended September 30, 1998, respectively, compared with interest
income of $1.1 million and $296,000 in the nine month and three month periods
ended September 30, 1997, respectively.

Interest payable has arisen in 1998 on $30 million of interest bearing term debt
drawn down to meet the cash consideration of the acquisitions of PhotoDisc and
Allsport and on the $75 million convertible notes issued on May 20, 1998, part
of the proceeds of which were used to repay the term debt.

                                       24
<PAGE>   26



NET EXCHANGE GAINS/(LOSSES)

Getty Images had net exchange losses of $116,000 and $57,000 in the nine month
and three month periods ended September 30, 1998, respectively, compared with
net exchange losses of $177,000 in the nine month period ended September 30,
1997 and net exchange gains of $135,000 in the three month period ended
September 30, 1997. These credits and costs are largely unrealized and arise
from revaluation of currency balances residing in Getty Images' subsidiaries'
books.

Getty Images hedges a majority of contracted net receivables and payables using
a combination of internal hedging, forward exchange contracts and foreign
currency term loans.

INCOME TAXES

In the nine month periods ended September 30, 1998 and 1997, Getty Images had a
tax charge of $557,000 and $3.2 million, respectively. In the three month period
ended September 30, 1998, Getty Images had an income tax charge of $188,000 and
$1.1 million in the three month period ended September 30, 1997. Excluding the
tax credit of $4.0 million for the nine months ended September 30, 1998 and $1.7
million for the three months ended September 30, 1998 arising on the
non-recurring integration and restructuring costs and the amortization of
intangibles, which is largely non-tax deductible, Getty Images had effective tax
rates of 36.8% and 38.1% for the nine month and three month periods ended
September 30, 1998, respectively, and 35.0% and 34.1% for the nine month and
three month periods ended September 30, 1997, respectively.

The changes in the effective rate of tax, excluding the impact of amortization
of intangibles, non-recurring integration and restructuring costs and
extraordinary costs reflects the fact that a substantial amount of the Group's
profit now falls due for taxation in the United States.

EXTRAORDINARY ITEMS

The repayment of the term debt due to Midland Bank plc from the proceeds of the
$75 million, 4.75% convertible subordinated notes resulted in an extraordinary
charge of $0.8 million in the nine month period ended September 30, 1998
comprising the write off of unamortized loan arrangement costs net of the
associated income tax benefit.

NET (LOSS)/INCOME

As a result of the foregoing, the net losses for the nine month and three month
periods ended September 30, 1998 were $29.8 million and $9.7 million,
respectively, compared to net income of $3.7 million and $1.3 million,
respectively, in the nine month and three month periods ended September 30,
1997.

                                       25
<PAGE>   27
EBITDA

EBITDA increased from $14.0 million and $5.0 million in the nine month and three
month periods ended September 30, 1997, respectively, to $24.7 million and $9.8
million in the nine month and three month periods ended September 30, 1998,
respectively, an increase of 77% and 96%.

"EBITDA" is defined as earnings before interest, taxes, exchange gains/(losses),
depreciation, amortization, non-recurring integration and restructuring costs
and extraordinary costs. Thus, EBITDA with respect to Getty Images comprises
sales less cost of sales and selling, general and administrative expenses. Getty
Images believes that EBITDA provides a measure of operating income unaffected by
the financing of the business and the accounting effects of acquisitions and
assists in explaining trends in the operating performance of Getty Images.
EBITDA should not be considered as an alternative to operating income as an
indicator of Getty Images' operating performance or to cash flows as a measure
of Getty Images' liquidity.

YEAR 2000

The Year 2000 issue refers to the risk that systems, products and equipment
having date-sensitive components will not recognize the Year 2000 as a result of
computer programs using two digits rather than four to define the applicable
year. The use of non-Year 2000 compliant programs or the inability of the
Company to update its systems successfully may result in system failures,
miscalculations or errors causing disruptions of operations, the corruption of
data, or other business problems, including, among other things, a temporary
inability to process transactions and invoices, or engage in similar normal
business activities. In addition to the Company's computer systems, the Year
2000 issue may affect certain embedded systems (alarms, gates and time locks,
lighting, security, electrical supply control and backup equipment) and
communication systems (switchboards, fax machines and cellular telephones)
areas.

In addition to Year 2000 issues related to the Company's systems, Getty Images
may be adversely affected if the Company's key suppliers or other material third
party service providers are unable or fail to address the Year 2000 issue
adequately. Such suppliers can include infrastructure suppliers in areas such as
utilities, communications, transportation and other services. While the Company
is developing alternate power generation sources for its most sensitive systems,
the likelihood and effects of failures in infrastructure systems and in the
supply chain cannot be estimated.

                 Getty Images' Year 2000 Compliance Program and
                             The Company's Readiness

Getty Images developed the Year 2000 Compliance Program (the "Program") to
identify and mitigate Year 2000 issues in its information systems, facilities
and suppliers. The Program can be divided into three phases: (1) Evaluation
(identify issues, inventory the systems affected, and develop solutions to
address the issues); (2) Implementation (deploy program and software changes and
complete necessary contingency plans); and (3) Testing (perform applications and
acceptance testing and certification).

The goals of the Program are to (1) ensure that Getty Images and its business
divisions can continue to function at optimal levels up to and beyond December
31, 1999, (2) provide Getty Images' customers and partners with the Company's
services throughout the affected period and (3) ensure that key suppliers are
Year 2000 compliant and that there will be no disruption in the supply of
services and products to Getty Images.

The Chief Executive Officer of the Company is responsible for the overall
implementation of the Program and ensuring that the Company becomes Year 2000
compliant by December 31, 1999.


                                      26

                                       
<PAGE>   28

The Senior Vice President of Planning is responsible for the day to day
management of the Program and reports directly to the Board of Directors of the
Company. A dedicated team has been assembled to implement the Program and each
senior division head has been made aware of each division's special concerns
with the Year 2000 issue and the importance of becoming Year 2000 compliant.

As of September 30, 1998, Getty Images has substantially completed Phase 1 of
the Program, has partially completed Phase 2 and begun Phase 3 testing of
certain systems. The Company expects that all of its systems will be Year 2000
compliant by the end of the third quarter 1999. Contingency plans will be
developed for any matter not resolved in 1999 that may have a material negative
impact on the Company's final year 2000 readiness.
   
Evaluation. The Company has inventoried substantially all of its major hardware
and software platforms, as well as the relevant computer, embedded and
communication systems, which may be affected by the Year 2000 issues and
assessed the needs of the Company to become Year 2000 compliant. The Company has
also commenced a review of the Year 2000 issues faced by its material suppliers,
licensees and agents, evaluated the risks and dependencies associated with such
suppliers, licensees and agents and such parties' state of readiness. In
particular, the Company is reviewing its reliance on third parties which provide
the Company with credit card processing services, the Company's software and
hardware maintenance contracts and its insurance policies.
    
The Company expects to complete this Phase of the Program in the first quarter
of 1999.

Implementation. The Company has begun its deployment of software and hardware
changes. Year 2000 compliance measures have been incorporated into all new web
initiatives, become the standard within the Company for all new contracts and
incorporated into the Company's due diligence program when evaluating potential
acquisitions.

In addition, the Company has begun preparation of its first stage contingency
plans which addresses the identification of alternate suppliers and distribution
channels and the implementation of manual systems if it becomes necessary. The
Company expects to complete this stage of the contingency plan in the first
quarter of 1999.

Testing. The Company has begun testing its CD products and e-commerce systems.
Testing on the e-commerce system demonstrated that certain of the systems needed
upgrades to become Year 2000 compliant. The Company expects the upgrades to be
completed in the first quarter of 1999.
   
The Company will continue its testing of its computer, embedded and
communication systems as it completes the implementation of its software and
hardware changes.
    


                                      27

<PAGE>   29


                                 Year 2000 Costs
   
Getty Images estimates that the expected total aggregate costs for its Year 2000
activities from 1997 through 2000 will be approximately $1.5 million, of which
approximately $100,000 has been spent as of September 30, 1998. These costs will
be capitalized to the extent permitted under generally accepted accounting
principles.
    
                      Risks Related to the Year 2000 Issue

Although the Company's efforts to be Year 2000 compliant are intended to
minimize the adverse effects of the Year 2000 issues on the Company's operations
and business, the actual effects of the Year 2000 issue will not be known until
2000. The failure by the Company and or its material suppliers to become Year
2000 compliant in a timely manner could have a material adverse effect on the
Company's business, results of operations and financial condition. The Company's
capital requirements may differ materially from the foregoing estimate as a
result of regulatory, technological and competitive developments in the
Company's industry.
   
The Year 2000 disclosure set forth above is intended to be a "year 2000
statement" as such term is defined in the Year 2000 Information and Readiness
Disclosure Act of 1998 (the "Year 2000 Act") and, to the extent such disclosure
relates to Year 2000 processing of the Company or to products or services
offered by the Company, is intended to be a "year 2000 readiness disclosure" as
such term is defined in the Year 2000 Act.



THE EURO CONVERSION

The Company is coordinating the preparations for the European currency "Euro"
particularly with respect to the Company's European subsidiaries. The Company is
investigating the impact of this conversion on the business including, but not
limited to, the costs associated with the conversion, the competitive
implications and its effects on the Company's contracts and business
relationships. The Company has begun preparation for the conversion including
coordination with customers, suppliers and financial institutions to ensure a
smooth transition. The Company expects to be able to transact business in the
Euro beginning on January 1, 1999.
    

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<PAGE>   30

<TABLE>
<CAPTION>


LIQUIDITY AND CAPITAL RESOURCES

                                          NINE MONTHS ENDED SEPTEMBER 30
                                          ------------------------------
                                              1997              1998
                                                $                $
                                         (IN THOUSANDS)   (IN THOUSANDS)
<S>                                        <C>                 <C>  
Net cash provided by/(used in):
        Operating activities               $ 12,895            9,764
        Investing activities                (32,187)         (95,298)
        Financing activities                 (3,285)          84,948
        Exchange differences                 (3,224)             892
                                           --------         --------
Net increase/(decrease) in cash and
    cash Equivalents                        (25,801)             306
                                           ========         ========
</TABLE>


Getty Images' cash resources increased by $0.3 million in the nine month period
ended September 30, 1998 compared to a decrease of $25.8 million in the nine
month period ended September 30, 1997.

Net cash provided by operating activities amounted to $9.8 million in the nine
month period ended September 30, 1998 compared to $12.9 million in the nine
month period ended September 30, 1997. The cash generated was less in 1998 as a
result of payments in respect of non-recurring integration and restructuring
costs and adverse movements in working capital arising from timing differences
between the two periods. In particular, substantially more deferred expenditure
arose in the nine month period ended September 30, 1998 due to the timing and
production of catalogs compared to that in the nine month period ended September
30, 1997. In the nine month period ended September 30, 1998, Getty Images
invested $16.6 million in fixed assets compared to $10.6 million in the nine
month period ended September 30, 1997.

The acquisitions of PhotoDisc and Allsport in February 1998 resulted in a cash
outflow of $76.2 million, including expenses. To fund this, Getty Images raised
a net additional $30 million of debt and Getty Investments L.L.C. subscribed for
an additional 1.5 million shares, providing $28 million of additional capital.
On May 20, the Company raised $75 million from the issue of convertible notes.
$49 million of this was applied to the repayment of term debt and costs of
approximately $3.6 million were incurred. Also, in the nine months ended
September 30, 1998, the Company raised $4 million from the exercise of options.

At September 30, 1998, Getty Images had outstanding long term debt of $75.0
million and cash of $29.5 million.


                                       29
<PAGE>   31



                                   SIGNATURES

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


   
DATE: NOVEMBER 20, 1998                       BY: /s/ Lawrence Gould
                                                 ---------------------------
                                                     LAWRENCE GOULD
                                                     CHIEF FINANCIAL OFFICER


o Signing on the behalf of the Registrant as a principal financial officer

                                      30