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                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D. C. 20549


                                   FORM 10-QSB

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

                  For the quarterly period ended June 30, 1997

                                       OR

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


                           Commission File No. 0-12193

                          AFFINITY ENTERTAINMENT, INC.
             (Exact name of registrant as specified in its charter)

             Delaware                                       22-2473403
    (State or other jurisdiction of                      (I.R.S. Employer)
     incorporation or organization)                      Identification No.)


    15310 Amberly Drive, Suite 370, Tampa, Florida             33647
       (Address of principal executive offices)             (Zip Code)


                                 (813) 975-8180
              (Registrant's telephone number, including area code)


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

Registrant has 9,718,884  shares of  outstanding  Common Stock as of August 13 ,
1997

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



<PAGE>



PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements.

<TABLE>
<CAPTION>
                  AFFINITY ENTERTAINMENT, INC. AND SUBSIDIARIES
           CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
---------------------------------------------------------------------------------------
                      (In thousands, except per share data)

                                                  Quarter Ended       Nine Months Ended
                                                June 30,   June 30,   June 30, June  30,
                                                  1997       1996       1997      1996
----------------------------------------------------------------------------------------
<S>                                             <C>        <C>        <C>        <C>    
REVENUE .....................................   $   332    $    13    $   412    $ 1,433
COSTS AND EXPENSES
   Cost of revenue, exclusive of amortization      --          251       --        1,568
   General and administrative ...............       781        333      2,143      1,052
   Depreciation and amortization ............       102        233        306        243
                                                -------    -------    -------    -------
         Total costs and expenses ...........       883        817      2,449      2,863
                                                -------    -------    -------    -------
   Operating loss ...........................      (551)      (804)    (2,037)    (1,430)

OTHER INCOME, net ...........................      --           12       --          197
                                                -------    -------    -------    -------
Loss from continuing operations .............      (551)      (792)    (2,037)    (1,233)

DISCONTINUED OPERATIONS:
  Loss from discontinued subsidiaries .......      (674)       (87)    (1,098)      (232)
  Loss on disposal of subsidiaries ..........      (615)      --         (615)      --
                                                -------    -------    -------    -------
    Loss from discontinued operations .......   $(1,289)   $   (87)   $(1,713)   $  (232)

Net loss ....................................   $(1,840)   $  (879)   $(3,750)   $(1,465)
                                                =======    =======    =======    =======

Loss per common share .......................   $  (.19)   $  (.12)   $  (.43)   $  (.20)
                                                =======    =======    =======    =======

Weighted average shares outstanding .........     9,719      7,354      8,733      7,211
                                                =======    =======    =======    =======

</TABLE>








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







                                        2


<PAGE>



                  AFFINITY ENTERTAINMENT, INC. AND SUBSIDIARIES
                CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited)
--------------------------------------------------------------------------------
                                 (In thousands)

                                                       June 30,     Sept. 30,
                                                         1997          1996
--------------------------------------------------------------------------------


                                    ASSETS

CURRENT ASSETS
  Cash and cash equivalents............                $    5         $1,366
   Accounts receivable, net............                    --            133
   Loan receivable.....................                   120             --
   Other receivables, current portion..                   110             --
  Programming costs....................                   599            990
  Other current assets, net............                   130            188
                                                       ------         ------
      Total current assets.............                $  964         $2,677

PROPERTY, PLANT AND EQUIPMENT, at cost
  Edit equipment.......................                $   --         $1,237
  Furniture and equipment..............                   272            314
                                                       ------         ------
                                                          272          1,551
  Less accumulated depreciation........                    71          1,072
                                                       ------         ------
                                                          201            479
  Construction in progress.............                    --             64
                                                       ------         ------
      Total property and equipment.....                   201            543

OTHER ASSETS
  Loans and other receivables, net.....                   390            539
   Investment in joint venture, net....                   250            250
   Other assets........................                    10            315
                                                       ------         ------
  Total other assets...................                   650          1,104
                                                       ------         ------
  Total assets.........................                $1,815         $4,324
                                                       ======         ======









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

                                        3


<PAGE>



                  AFFINITY ENTERTAINMENT, INC. AND SUBSIDIARIES
         CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited) - (Continued)
--------------------------------------------------------------------------------
                                 (In thousands)

                                                      June  30,     Sept.  30,
                                                         1997           1996
--------------------------------------------------------------------------------


                      LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
  Accounts payable.....................                $  489        $    --
  Notes payable........................                   756             12
  Notes payable - related party........                    14            --
  Accrued liabilities..................                    87            139
                                                       ------         ------
       Total current liabilities.......                $1,346         $  151
                                                       ------         ------

STOCKHOLDERS' EQUITY
  Convertible  preferred stock - $1 par value;
     $10 stated value, 500,000 shares authorized,
     48,734 shares issued and outstanding..             $ 487           $487
  Convertible preferred stock - $.0001 par value,
      $50 stated value, 100,000 shares authorized,
      no shares issued and outstanding....                 --             --
  Common stock - $.01 and $.10 par value;
      25,000,000 shares authorized, 9,718,884
      and 8,284,217 shares issued and outstanding,
      respectively.....................                    97            829
  Additional paid-in capital...........                15,439         14,686
  Additional paid-in capital - stock options              279            394
  Deficit..............................                (9,644)        (5,894)
                                                       ------         ------
                                                        6,658         10,502
Less:
  Stock subscriptions receivable.......                 5,266          5,829
   Dividend-Century Technologies, Inc. stock              600             --
  Note receivable - stockholders    ...                   132             --
  Unearned compensation................                   152            432
  Due from officers and directors......                    39             68
                                                       ------         ------
      Total stockholders' equity.......                   469          4,173
                                                       ------         ------
   Total liabilities and stockholders' equity          $1,815         $4,324
                                                       ======         ======



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



                                        4


<PAGE>

<TABLE>
<CAPTION>

                                                AFFINITY ENTERTAINMENT, INC. AND SUBSIDIARIES
                                    CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited)
------------------------------------------------------------------------------------------------------------------------------------
                                                               (In thousands)

                          Convertible Convertible                Additionnal
                            Preferred Preferred   Common            Paid-In
                            Stock     Stock       Stock  Additional Capital         Stock              Note   Unearned Due
                           $50 Stated $10 Stated  $.10     Paid In  Stock           Subscription Divi- Receiv- Compen- From
                            Value     Value      Par Value Capital  Options Deficit Receivable   dend   able   sation Officers Total
------------------------------------------------------------------------------------------------------------------------------------

<S>                              <C>     <C>      <C>     <C>       <C>    <C>      <C>         <C>     <C>    <C>     <C>   <C>   
Balance on October 1, 1996.....  $ --    $487     $829    $14,686   $394   $(5,894) $(5,829)      --      --   $(432)  $(68) $4,173
Cash received on subscription           
     receivable................    --      --       --         --     --        --      165       --      --      --     --     165
Amortization of unearned                
    compensation...............    --      --       --         --     --        --       --       --      --     280     --     280
Changes in par value of                 
     common stock..............    --      --     (746)       746     --        --       --       --      --      --     --      --
Exercise of employee stock              
     options...................    --      --        1        286   (115)       --       --       --      --      --     --     172
Adjustment to stock price......    --      --       --       (398)    --        --      398       --      --      --     --      --
Exercise of stock options......    --      --       13        119     --        --       --       --    (132)     --     --      --
Repayment of loan..............    --      --       --         --     --        --       --       --      --      --     29      29
Dividend of Century                     
  Technologies, Inc............    --      --       --         --     --        --       --     (600)     --      --     --    (600)
Net loss for the nine months            
  ended June 30, 1997..........    --      --       --         --     --    (3,750)      --       --      --      --     --  (3,750)
                                  ---    ----      ---    -------    ----  -------  -------    -----   -----   -----   ----  ------
Balance on June 30, 1997.......   $--    $487     $ 97    $15,439    $279  $(9,644) $(5,266)   $(600)  $(132)  $(152)  $(39) $  469 
                                  ===    ====     ====    =======    ====  =======  =======    =====   ======  =====   ====  ======

</TABLE>











































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

                                            5



<PAGE>


                  AFFINITY ENTERTAINMENT, INC. AND SUBSIDIARIES
           CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
--------------------------------------------------------------------------------
                                 (In thousands)
                                                              Nine Months Ended
                                                             June      June 30,
                                                             1997        1996
--------------------------------------------------------------------------------

Cash Flows - Operating Activities:
Net loss.............................................      $(3,750)    $ (1,465)
Adjustments to reconcile net loss to net cash used in
 operating activities:
   Depreciation and amortization.....................          306          340
   Amortization of unearned compensation related to grant
       of stock options to executives................          226           81
Changes in current assets and liabilities:
   (Increase) decrease in accounts receivable........          133           81
   Increase (decrease) in loan and other receivable..         (230)          --
(Increase) decrease in programming costs.............          390         (149)
   (Increase) decrease in other current assets.......           57           --

   Increase (decrease) in accounts payable
      and accrued liabilities........................          436         (900)
   Increase (decrease) in deferred revenue...........           --         (206)
  Increase (decrease) in television broadcast air time          --           79
  Increase (decrease) in other assets................         (117)        (138)
                                                            ------      -------
     Net cash used in operating activities...........      $(2,549)     $(2,277)
                                                           -------      -------
Cash Flows - Investing Activities:
   Capital expenditures..............................          (57)         (95)
   Investments in loan receivables...................            --        (600)
                                                            -------      ------
     Net cash used in investing activities...........          (57)        (695)
                                                           -------       ------
Cash Flows - Financing Activities:
   Proceeds from sale of common stock................          486        6,650
   Proceeds from notes payable.......................          759          145
   Principal payments on notes payable...............           --         (850)
                                                           -------      -------
     Net cash provided by financing activities.......        1,245        5,945
                                                           -------      -------
(Decrease)Increase in cash and cash equivalents......       (1,361)       2,973
   Cash and cash equivalents at beginning of period..        1,366          147
                                                           -------      -------
   Cash and cash equivalents at end of period........      $     5      $ 3,120
                                                           =======      =======

Supplemental schedule of non-cash investing and financing activities:

   During the quarter ended June 30, 1997,  several foreign investors  exercised
stock options and the Company issued  1,320,000  shares of the Company's  common
stock at $ .10 per share, for total consideration of $132,000.

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

                                        6

<PAGE>

                AFFINITY ENTERTAINMENT, INC. AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)


NOTE A - HISTORY AND ORGANIZATION

      Affinity   Entertainment,   Inc.  (the   "Company"),   formerly   Affinity
Teleproductions, Inc., a Delaware corporation, is currently engaged in producing
and selling feature films in the United States and internationally.  The Company
entered  into  this  business   following  a  February  1994  merger  with  CBNI
Development,  Inc.  ("CBNI").  CBNI  had  been  engaged  in a  shopping  service
business.

      On August 31, 1994, the Company acquired Broadcast Edit, Inc.  ("Broadcast
Edit"),  a  California  corporation,  for  50,000  shares of  common  stock in a
transaction  accounted  for a pooling of  interests.  Broadcast  Edit is a video
production   and   post-production   company.   It  provides  a  full  range  of
communication  services to corporations  and advertising  agencies,  and it also
produces, directs and edits television programs and videos for the entertainment
industry.  This subsidiary was transferred to Century Technologies,  Inc. in May
1997. See Note C.

      On October 31, 1996,  the Company  entered into an agreement to purchase a
73% interest in Century Technologies, Inc., a publicly-held Colorado corporation
that  is in the  business  of  distributing  film  and  television  products  to
worldwide markets. This agreement was terminated in May 1997. See Note C.

      On December 9, 1996,  the Company  formed a new  wholly-owned  subsidiary,
Tradewinds Television,  Inc., for the purpose of operating a domestic television
syndication  company.  On  March 3,  1997,  the name  was  changed  to  Affinity
Television,  Inc. This subsidiary was transferred to Century Technologies,  Inc.
in May 1997. See Note C.

      The  Company  formed a  wholly-owned  subsidiary,  Affinity  Entertainment
Group, Inc. on April 4, 1995, to intensify efforts on its feature film business.
Affinity  Entertainment  Group,  Inc. has entered  into an  agreement  with Azur
Entertainment,  Ltd. to develop a made-for-television  movie (working title Cote
d'Azur),  that will be filmed and set in the  Principality of Monaco.  Once this
film is completed,  the Company and other entities will enter into a partnership
for the distribution of the film to the major television networks.

       The Company's  first film, Men Seeking Women,  premiered on March 8, 1997
at the Santa Barbara Film Festival  (California).  The Company will receive half
of the gross revenues from this motion picture after recouping the costs already
expended.

      The Company  acquired  the film rights to Elvis and Leon,  a  contemporary
comedy/adventure  film from  Paramount  Pictures.  The film rights to Lucifer in
Cameo have also been acquired from Kazmark Entertainment.  Production dates have
not been set for these  projects;  however,  it is  expected  that the rights to
these projects will yield additional revenue in the future.




                                        7



<PAGE>

NOTE B - BASIS OF PRESENTATION

      The  accompanying   Condensed  Consolidated  Balance  Sheet  includes  the
accounts of the Company and its wholly-owned subsidiary,  Affinity Entertainment
Group, Inc. The statement of Operations includes the accounts of the Company and
its wholly-owned  subsidiary,  Affinity  Entertainment Group, Inc.; and from the
date of acquisition through May 1997 for Century Technologies, Inc. and Affinity
Television,  Inc. and from the beginning of the fiscal year through May 1997 for
Broadcast Edit, Inc. All significant  intercompany  accounts,  transactions  and
profits  have  been  eliminated.  The  transferred  subsidiaries  (see  Note C),
Broadcast Edit, Inc., Century Technologies,  Inc. and Affinity Television,  Inc.
have been presented as discontinued operations.

      The Condensed  Consolidated  Financial Statements are unaudited and should
be read in conjunction with the audited  Consolidated  Financial  Statements and
notes thereto for the fiscal year ended September 30, 1996.

      In  the  opinion  of  management,  all  adjustments  necessary  for a fair
presentation  of such  Condensed  Consolidated  Financial  Statements  have been
included.  Such  adjustments  consist only of normal  recurring  items.  Interim
results are not necessarily indicative of results for a full year. The Condensed
Consolidated Financial Statements and notes hereto are presented as permitted by
the  Securities  Exchange  Commission  and do not  contain  certain  information
included in the Company's  annual  Consolidated  Financial  Statements and notes
hereto as discussed above.

NOTE C - SIGNIFICANT EVENTS

SALE OF SUBSIDIARIES

      The  Company  entered  into an  agreement  in May 1997,  to sell  Affinity
Television,  Inc. and Broadcast Edit,  Inc., its wholly-owned  subsidiaries,  to
Century  Technologies,  Inc. As a part of this  transaction,  Affinity  returned
30,000,000 of the  37,500,000  units of Century stock that it had purchased from
Century pursuant to a stock purchase  agreement dated October 31, 1996. The note
in the amount of $2,400,000 due Century Technologies, Inc. was canceled.

      In addition, the Company transferred to Century Technologies,  Inc. all of
the Company's  outstanding  shares in two of its  subsidiaries,  Broadcast Edit,
Inc.  and  Affinity  Television,  Inc. In exchange  for this  transfer,  Century
Technologies,  Inc. will pay the Company a minimum of $500,000,  to a maximum of
$2 million, from the net cash flow of Affinity Television, Inc.

      The  Company  announced  on May 28,  1997,  that the  remaining  7,500,000
unregistered units of Century Technologies,  Inc. stock will be distributed on a
pro-rata  basis  as  a  stock  dividend  to  all  Affinity  Entertainment,  Inc.
shareholders  as of July 1, 1997.  Each unit  shall  consist of one (1) share of
Century  Common  Stock at $ .00001 par value and one (1) Warrant to purchase one
(1) share of Century Common Stock at $2.00 per share.

MOVIE PROJECTS

      Affinity Entertainment Group, Inc. has entered into an agreement with Azur
Entertainment,  Ltd. to develop a made-for-television  movie (working title Cote
d'Azur),  that will be filmed and set in the  Principality of Monaco.  Once this
film is completed,  the Company and other entities will enter into a partnership
for the distribution of the film to the major television networks.

                                        8

<PAGE>



      The Company's first film, Men Seeking Women, premiered on March 8, 1997 at
the Santa Barbara Film Festival  (California).  The Company will receive half of
the gross  revenues from this motion  picture after  recouping the costs already
expended.

      The Company  acquired  the film rights to Elvis and Leon,  a  contemporary
comedy/adventure  film from  Paramount  Pictures.  The film rights to Lucifer in
Cameo have also been acquired from Kazmark Entertainment.  Production dates have
not been set for these  projects;  however,  it is  expected  that the rights to
these projects will yield additional revenue in the future.

AUTHORIZATION OF PREFERRED STOCK

      On October 31, 1996, the Company  authorized the creation of two shares of
Series  D  Preferred  Stock  with  a par  value  of $1 in  connection  with  the
acquisition of Century  Technologies,  Inc. These  certificates were canceled in
May 1997. (See SALE OF SUBSIDIARIES.)

ACQUISITION OF CENTURY TECHNOLOGIES, INC. AND SUBSEQUENT CANCELLATION

      On October  31,  1996,  the Company  purchased  a 73%  interest in Century
Technologies,  Inc. ("Century"), a publicly-held Colorado corporation that is in
the business of distributing film and television  products to worldwide markets.
Under the terms of the Stock  Acquisition  Agreement  between the  parties,  the
Company purchased 37,500,000 Units of Century for $0.08 per unit.

      Each Unit consisted of one (1) share of Century Common Stock at $.0001 par
value  ("Century  Common  Stock") and one (1) Common Stock  purchase  warrant to
purchase  one (1)  share  of  Century  Common  Stock  at $2.00  per  share  (the
"Warrants"). The Units were immediately separable into their component parts. In
consideration  for the  transfer of the Units,  the Company  paid Three  Million
Dollars  ($3,000,000)  to Century  consisting of (i) the conversion to equity of
Four Hundred Thousand Dollars ($400,000) cash previously advanced by the Company
to Century,  (ii) Two Hundred  Thousand  Dollars  ($200,000)  cash,  and (iii) a
negotiable  one-year  promissory  note  payable by the Company to Century in the
amount  of  Two  Million  Four  Hundred  Thousand  Dollars   ($2,400,000)   (the
"Promissory Note") which was secured by the Company's Series D Preferred Stock.

      The  Promissory  Note bore  interest at a rate of eight  percent  (8%) per
annum and was  secured  by two (2)  shares of  Series D  Preferred  Stock of the
Company, par value $1.00 (the "Series D Preferred Stock").  Each share of Series
D Preferred  Stock was convertible  into 750,000 shares of the Company's  Common
Stock only in the event of default by the Company on the  Promissory  Note.  The
Series D Preferred  Stock was not entitled to any voting for dividend  rights of
any kind.  Notwithstanding  the foregoing,  the Company had the right to provide
such substitute collateral as the Company and Century may mutually agree upon in
writing.  The Series D Preferred  Stock was held in escrow by Century's  counsel
(the "Escrow  Agent") until such time as the Promissory Note was paid in full or
substitute collateral was provided by the Company.

      The  agreement  between the Company and  Century  Technologies,  Inc.  was
canceled in May 1997. (See SALE OF SUBSIDIARIES.) 
                      



                                      9

<PAGE>

ACQUISITION OF THE ASSETS OF TRADEWINDS TELEVISION, LLC AND TRANSFER OF AFFINITY
TELEVISION, INC. TO CENTURY TECHNOLOGIES, INC.

      On  September  13, 1996,  the Company and  Tradewinds  Television,  LLC, a
California  Limited  Liability Company  ("Tradewinds"),  entered into an Interim
Financing and Security  Agreement (the "Security  Agreement")  pursuant to which
Tradewinds  granted the Company,  as security for the repayment by Tradewinds of
certain loans to be made by the Company,  a first priority lien on substantially
all of Tradewinds' assets (the "Assets").

      The Assets included  accounts  receivable,  the name and mark  "Tradewinds
Television," the rights to the syndicated television series "Bounty Hunters" and
distribution  rights to certain other  television  products.  As of November 19,
1996, the Company had loaned  Tradewinds an aggregate of approximately  $823,000
(the "Loans") pursuant to the Security Agreement.

      Concurrently,  with the execution of the Security  Agreement,  the Company
and  Tradewinds  engaged in  negotiations  pursuant to which the  Company  would
purchase  substantially  all of the Assets.  The parties  entered  into an Asset
Purchase  Agreement,  dated  October 3, 1996,  as  amended,  to provide for such
acquisition.  The sale of the assets was  contingent  upon the resolution to the
satisfaction  of the  Company  of various  bankruptcy  issues  concerning  other
companies affiliated with Royeric Pack, the owner of Tradewinds.

      On  November  14,  1996,  the  Company  filed a  complaint  in Los Angeles
Superior Court  asserting that  Tradewinds had defaulted under the Loans and the
Security Agreement,  and seeking judicial foreclosure on the Assets, among other
claims. On December 6, 1996,  Tradewinds in lieu of foreclosure on the Assets by
the Company, agreed to transfer and assign to the Company the Assets, subject to
certain payables  associated  therewith,  in consideration of Affinity forgiving
the indebtedness  evidenced by the Loans. Such indebtedness,  including interest
and related costs and expenses, was approximately  $1,000,000.  Also on December
6, 1996, the Company entered into an Executive Producer Agreement with Mr. Pack,
providing  executive  producing  services in connection  with the Bounty Hunters
series.  Pursuant  to such  agreement,  Mr. Pack  received a $75,000  payment on
December 6, 1996 for the first production  season, and is entitled in the second
production  season to a fee of $3,000 per  episode,  payable upon airing of each
such episode.

      On December 17, 1996,  the Company agreed with the Trustee of Action Media
Group,  Inc.,  a company  affiliated  with Mr. Pack and which was the subject of
bankruptcy court proceeding  ("AMG"), to pay $275,000 to the Trustee of AMG, and
to secure in exchange a release of certain claims by the Trustee and AMG against
Tradewinds  and the Company with regard to  indebtedness  owed by the Company in
lieu of foreclosure, as described above.

      On  December  18,  1996,  the  Court  having  jurisdiction  over  the  AMG
bankruptcy  proceeding  approved  the  $275,000  payment and release  among AMG,
Tradewinds and the Company. An order to this effect (the "Settlement Order") was
entered on January 14, 1997.  The Company  Trustee  subsequently  filed a motion
seeking to amend the unspecified liabilities owed by Tradewinds to third parties
including AMG. The Company is contesting this motion.

      Upon  receipt of the Assets by the Company,  the Assets were  deposited in
the Company's wholly owned  subsidiary,  Affinity  Television,  Inc. The Company
transferred Affinity Television, Inc. to Century Technologies, Inc. in May 1997.
(See SALE OF SUBSIDIARIES.) 
                                       10

<PAGE>

NOTE D - INCOME TAXES

      The Company  provides for the tax effects of transactions  reported in the
Condensed Consolidated Financial Statements.  The provision, if any, consists of
taxes currently due plus deferred taxes related primarily to differences between
the basis of assets and liabilities for financial and income tax reporting.  The
deferred tax assets and  liabilities,  if any,  represent  the future tax return
consequences  of those  differences,  which will either be taxable or deductible
when the assets and liabilities  are recovered or settled.  As of June 30, 1997,
the Company  had no  material  current  tax  liability,  deferred  tax assets or
liabilities.

NOTE E - LOSS PER COMMON SHARE

      The loss per share of common stock is  calculated  by dividing net loss by
the  weighted  average  shares of  common  stock and  common  stock  equivalents
outstanding during the period.  Common stock equivalents include shares issuable
upon conversion of the Company's convertible preferred stock and exercise of the
Company's outstanding warrants and stock options. For the nine months ended June
30, 1997, common stock  equivalents were  anti-dilutive and were not included in
the calculation of weighted average common shares outstanding.

NOTE F - RECLASSIFICATIONS

      Reclassifications  to  the  June  30,  1996  consolidated   statements  of
operations and cash flows were made to conform to June 30, 1997 presentation.

NOTE G - ISSUANCE OF STOCK

      The Company had previously granted options to purchase the Common Stock of
the Company exercisable at $5.00 per share to several foreign investors pursuant
to the July 1995 Option  Agreements  between the  Company and such  holders.  On
February 12, 1997, the exercise  price was reduced to $2.00 per share.  On March
31, 1997,  the Company  further  reduced the price of these options to $1.25 per
share.  During the quarter  ended June 30,  1997,  the option  price was further
reduced to $ .10 and options for 1,320,000  shares were exercised.  The $132,000
has not been paid as of June 30, 1997 and is presented as a note  receivable  in
the stockholders' equity section.

NOTE H - DISCONTINUED OPERATIONS

      Discontinued  operations  reflect the operating results of the transferred
subsidiaries,  Broadcast  Edit,  Inc.,  Affinity  Television,  Inc.  and Century
Technologies,  Inc. (See Note C.) The operating  results for the quarter and the
nine months  ended June 30, 1996 have been  restated to reflect the  transfer of
these subsidiaries as discontinued operations for comparative purposes.






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<PAGE>

NOTE I - OTHER EVENTS

      The  Company  entered  into a two year  agreement  dated April 4, 1997 for
referral of  full-length  feature  motion  picture  projects to the Company.  In
consideration,  the  Company  was to  issue  100,000  shares  of  the  Company's
unrestricted common shares, and beginning May 1, 1997, pay $10,000 per month for
the  remaining  tenure of the  agreement.  This  agreement  has been canceled by
mutual consent of both parties, with no consideration having been paid.

      On April 4, 1997, the Company  entered into an agreement to sell 2,500,000
shares of the  Company's  shares of  restricted  common stock at $1.25 per share
payable over several  months.  The investment  group made an initial  payment of
$325,000  and then  defaulted on this  agreement.  No shares were issued and the
$325,000  was  recorded as revenue.  The  2,500,000  shares  were  canceled  and
returned to treasury. This agreement was terminated in May 1997.

      Effective April 1,1997,  the Company  entered into a separation  agreement
with an employee to terminate the employee under his  employment  contract dated
July 14, 1994. The terms of the agreement are currently being re-negotiated,  as
the original agreement is in default.

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS

      The Company produces and sells feature films for all media worldwide.


A.  RESULTS OF OPERATIONS

      The following table  summarizes the changes in selected  items,  including
absolute  dollar changes,  for the nine months ended June 30, 1997,  compared to
the nine months ended June 30, 1996.

                                              Nine Months Ended
                                              -----------------
                                              June 30   June 30    $ Change
                                                1997      1996    Fav/(Unfav)
                                                ----      ----    -----------
                                                 (In Thousands, except %)

Net Revenue.........................           $ 412    $1,433    $ (1,021)
 Cost of Revenue....................              --        --          --
 General and administrative.........          (2,143)   (1,052)     (1,091)
  Depreciation and
    amortization....................            (306)     (243)        (63)
Operating loss......................          (2,037)   (1,430)       (607)
Other income, net...................              --       197        (197)
Net income (loss)...................          (3,750)   (1,465)     (2,285)

NET REVENUE

      For the nine  months  ended June 30,  1997,  the  decrease  in revenues is
primarily  due to the  Company  ceasing  the airing of its  television  project,
EdenQuest,  and all of its ancillary sources of income, and its The Contemporary
Collectibles Show series, and the sale of two of its subsidiaries.  For the nine
months ended June 30, 1996, the Company produced three original episodes,  and a
compilation ("best of") of its popular  EdenQuest television series.  As of June


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<PAGE>

30,  1997,  the  third  and  fourth  episodes  have  not been  telecast  on free
television  or basic cable.  These  programs  have been  transferred  to Century
Technologies,  Inc. as part of the May 1997  agreement.  The decrease in revenue
described  above  was  offset  in part by the  revenues  generated  by  Affinity
Television,  Inc.  derived mainly from the syndicated  television  series Bounty
Hunters and Ghostwriter, prior to their sale in May 1997.

COST OF REVENUE

      For the nine months ended June 30, 1997, the significant  decrease in cost
of revenue can be attributed to several factors.  For the quarter ended June 30,
1996,  television  distributors  commissions  were paid by the Company  based on
total cumulative  sales of EdenQuest.  As sales in EdenQuest  increased,  so did
commission  percentages.  In  addition,  the Company  canceled the launch of the
second  season  of The  Contemporary  Collectibles  Show,  due to a  variety  of
factors,  including the uncertainty  regarding the availability of its satellite
air time.  As a result,  the  Company  took a one time  charge of  approximately
$125,000 to operations  for expenses  incurred in  connection  with the Lifetime
Channel.

      In May 1997, all production  projects  involving  Broadcast Edit, Inc. and
Affinity Television,  Inc. were transferred to Century  Technologies,  Inc. (See
Note C.)

GENERAL AND ADMINISTRATIVE

      For the nine  months  ended June 30,  1997,  the  increase  in general and
administrative  expenses is primarily due to higher professional expenses as the
Company seeks to position itself to make  acquisitions and expand its operations
into feature films and distribution. Further, the Company hired additional staff
to  better  implement  its  business  plan and  increased  salaries  of some key
personnel to levels commensurate to their job descriptions.

Depreciation and Amortization

      For the nine months ended June 30, 1997, the increase in depreciation  and
amortization  expense  is  primarily  due to  the  accelerated  amortization  of
Edenquest and Adventure Quest program costs becoming fully amortized.


B.    FINANCIAL POSITION, LIQUIDITY AND CAPITAL RESOURCES

      The  Company  expects  to meet its cash  requirements  for the  balance of
fiscal year 1997 with funds  generated  from  operations,  including the sale or
joint venturing of its movie  properties,  sales of restricted  common stock via
private  placements and loans.  The Company  believes that these sources will be
adequate to meet the Company's  expected  needs for the remainder of fiscal year
1997, although there can be no assurance that this will be the case.

      For the nine  months  ended  June 30,  1997,  the  predominate  sources of
operating funds were advertising revenues from Bounty Hunters,  editing services
and exercise of stock options.

      Other than discussed  above,  the Company is not aware of any known trends
or uncertainties that have or are reasonably likely to have a material effect on
the Company's financial position, liquidity or capital resources.


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<PAGE>


PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

ALL-STAR BROADCAST SALES, INC.

      In May 1997, a proceeding was commenced  against the Company and others in
the Supreme Court of the State of New York,  County of New York.  The proceeding
is styled  All-Star  Broadcast  Sales,  Inc. v.  Affinity  Entertainment,  Inc.,
Tradewinds  Television,   LLC,  and  Tribune  Entertainment,   Inc.  (Index  No.
97/602626).  In June 1997,  defendants  removed this action to the United States
District  Court for the Southern  District of New York.  The  plaintiff  asserts
causes of action  against the Company for  tortious  interference  and breach of
contract and seeks injunctive relief,  specific  performance of an agreement and
approximately $650,000 in damages.

      Each cause of action  specifically  relates to an  agreement  between  the
plaintiff  and  defendant,  Tradewinds  Television  LLC. In the  agreement,  the
plaintiff  agreed  to be  the  exclusive  sales  agent  and  representative  for
Tradewinds  Television LLC on a national basis for the sale of barter commercial
inventory  in certain  television  programming.  Plaintiff  claims  damages as a
result of the alleged  assignment  of the  agreement to the Company  without the
plaintiff's  consent.  Because the rights to the television  shows which are the
subject of the agreement  between the plaintiff and  Tradewinds  Television  LLC
were previously assigned to the Company's subsidiary,  Affinity Television, Inc.
(which is now wholly-owned by Century Technologies,  Inc.), the Company believes
that it will ultimately prevail on this matter.

      Subsequent  to June 30,  1997,  the parties to this matter  entered into a
Stipulation of Settlement which will resolve the parties'  dispute.  The Company
is not required to make any payment to the plaintiff or any other party pursuant
to the terms of the  settlement  agreement.  The  plaintiff  has agreed to fully
release the Company for any and all liability.

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

      (a) Exhibits


      (b) Reports on Form 8-K















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<PAGE>


                                  SIGNATURES


      In  accordance  with  Section  13 or 15  (d)  of  the  Exchange  Act,  the
Registrant  caused  this  report to be signed on its behalf by the  undersigned,
thereunto duly authorized on August 19, 1997.


                                        AFFINITY ENTERTAINMENT, INC.



                                         /s/ William J. Bosso
                                        ----------------------------------------
                                        William J. Bosso
                                        Chairman, President, Secretary, Director


































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