<PAGE>

                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D. C. 20549

                                    FORM 10-Q


                Quarterly Report Under Section 13 or 15(d) of the
                         Securities Exchange Act of 1934



  For Quarter Ended:  March 28, 1997            Commission File No.:  0-14756



                            The Cosmetic Center, Inc.
             (Exact name of registrant as specified in its charter)


       Delaware                                              52-1266697
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                           Identification No.)

                              8839 Greenwood Place
                             Savage, Maryland 20763
                    (Address of principal executive offices)


                                 (301) 497-6800
              (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 [  ]


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



         Class C Common Stock, par value $.01 per share, outstanding as
                       of May 1, 1997 - 10,015,103 shares


                                Total Pages--28

<PAGE>



                            THE COSMETIC CENTER, INC.




                                Table of Contents






PART I - FINANCIAL
INFORMATION                                                             PAGE


 Item 1.  Financial Statements                                          4  - 10

 Item 2.  Management's Discussion and Analysis                         11  - 13
               of Financial Condition and Results of Operations


PART II - OTHER INFORMATION

Item 2.  Changes in Securities                                               14

 Item 4.  Submission of Matters to a Vote of Security Holders                14

 Item 5.  Other Information                                                  15

 Item 6.  Exhibits and Reports on Form 8-K                                   27

                                       2

<PAGE>



                                     PART I





ITEM 1.  Financial Statements                                      PAGE

 Consolidated Balance Sheets
         As of March 28, 1997 (unaudited) and
             September 27, 1996                                  4  -  5

Unaudited Consolidated Statements of Operations
         Three months and six months ended
             March 28, 1997 and March 29, 1996                         6

 Unaudited Consolidated Statements of Cash Flows
         Six months ended March 28, 1997
             and March 29, 1996                                        7

 Notes to Unaudited Consolidated Financial Statements
         Three months and six months ended
             March 28, 1997 and March 29, 1996                   8  - 10


                                       3

<PAGE>

                    THE COSMETIC CENTER, INC AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                             (dollars in thousands)

                                                   March 28,   September 27,
                         ASSETS                      1997          1996
                                                 ------------  -------------
                                                  (Unaudited)

CURRENT ASSETS:
  Cash and cash equivalents                          $ 1,817      $   979
  Accounts receivable, net                             1,264        1,860
  Inventories                                         53,197       56,479
  Prepaid expenses                                       749          442
  Prepaid income taxes                                   508        1,735
  Deferred income tax benefit                          1,582        1,631
                                                     -------      -------

Total current assets                                  59,117       63,126
                                                     -------      -------


PROPERTY AND EQUIPMENT:
  Furniture, fixtures and equipment                   11,097       10,989
  Leasehold improvements                               5,028        5,022
  Leased property capitalized                          1,652        1,652
                                                     -------      -------
                                                      17,777       17,663
  Accumulated depreciation and amortization           10,352        9,256
                                                     -------      -------

                                                       7,425        8,407
                                                     -------      -------

DEPOSITS AND OTHER ASSETS                                887          378
                                                     -------      -------

DEFERRED INCOME TAX BENEFIT                              362          611
                                                     -------      -------

TOTAL ASSETS                                         $67,791      $72,522
                                                     =======      =======




            See notes to unaudited consolidated financial statements.

                                       4
<PAGE>




                    THE COSMETIC CENTER, INC AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
             (dollars in thousands, except share and per share data)
<TABLE>
<CAPTION>


                                                          March 28,  September 27,
                                                            1997      1996
                                                            -------   -------
                                                           (Unaudited)
<S>                                                       <C>         <C>
LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES:
  Accounts payable                                          $12,630   $15,956
  Accrued expenses                                            3,847     4,044
  Current portion of obligation under capital leases            225       311
                                                            -------   -------

  Total current liabilities                                  16,702    20,311

NOTE PAYABLE - BANK                                          12,000    12,220

OBLIGATION UNDER CAPITAL LEASES                                  42       109

DEFERRED RENT                                                 1,243     1,305

OTHER LIABILITIES                                               668     1,396
                                                            -------   -------
TOTAL LIABILITIES                                            30,655    35,341
                                                            -------   -------

SHAREHOLDERS' EQUITY:
  Class A Common stock, $.01 par value; authorized
     5,000,000 shares; issued
     2,717,104 shares and
     2,713,354 shares, respectively                              27        27
  Class B Common stock, $.01 par value; authorized
     5,000,000 shares; issued 1,582,780 shares and
     1,582,780 shares, respectively                              16        16
  Additional paid in capital                                 21,401    21,386
  Retained earnings                                          15,692    15,752
                                                            -------   -------

TOTAL SHAREHOLDERS' EQUITY                                   37,136    37,181
                                                            -------   -------

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                  $67,791   $72,522
                                                            =======   =======

</TABLE>

            See notes to unaudited consolidated financial statements.

                                       5
<PAGE>




                   THE COSMETIC CENTER, INC. AND SUBSIDIARIES
                 UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
             (dollars in thousands, except share and per share data)
<TABLE>
<CAPTION>
<S>                                         <C>         <C>          <C>        <C>


                                              Three Months Ended      Six Months Ended
                                            ----------------------   -------------------
                                              March 28,   March 29,   March 28,   March 29,
                                                1997        1996        1997        1996
                                            -----------  -----------  ---------- ----------

Net sales.................................. $   27,337   $  29,263    $ 66,244   $  70,843
                                            -----------  -----------  ---------- ----------


Cost of sales including buying, occupancy
    and distribution.......................     21,037      23,007      51,263      55,427

Selling, general and administrative
    expenses...............................      7,373       7,621      14,494      15,267
                                            -----------  -----------  ---------- ----------

Total operating expenses...................     28,410      30,628      65,757      70,694
                                            -----------  -----------  ---------- ----------

Income (loss) from operations..............     (1,073)     (1,365)        487         149

Other income, net..........................         17          22          43          51

Interest expense...........................       (297)       (202)       (631)       (518)
                                            -----------  -----------  ---------- ----------

Loss before income taxes...................     (1,353)     (1,545)       (101)       (318)

Income taxes...............................       (548)       (626)        (41)       (129)
                                            -----------  -----------  ---------- ----------

Net loss...................................  $    (805)   $   (919)   $    (60)   $   (189)
                                            ===========  ===========  ========== ==========
Net loss per common share
 Primary...................................  $   (0.19)   $  (0.21)   $   (0.01)  $  (0.04)
                                            ===========  ===========  ========== ==========

Weighted average shares outstanding
 Primary...................................  4,324,022    4,308,280    4,329,887  4,313,218
                                            ===========  ===========  ========== ==========

</TABLE>


           See notes to unaudited consolidated financial statements.

                                       6
<PAGE>

                   THE COSMETIC CENTER, INC. AND SUBSIDIARIES
                 UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
                             (dollars in thousands)

                                                          Six Months Ended
                                                       ----------------------
                                                       March 28,    March 29,
                                                         1997         1996
                                                       ---------    ---------
  CASH FLOWS FROM OPERATING ACTIVITIES:
  Net loss                                               $   (60)   $  (189)
  Adjustments to reconcile net loss to
  net cash provided (used) by operating activities:
    Depreciation and amortization                          1,108      1,384
    Change in assets and liabilities:
      Accounts receivable, net                               596        (12)
      Inventories                                          3,282      6,876
      Prepaid expenses                                      (319)      (214)
      Prepaid income taxes                                 1,227       (134)
      Deposits and other assets                             (509)       (44)
      Deferred income tax benefit                            298       --
      Accounts payable                                    (3,326)    (4,102)
      Accrued expenses                                      (197)      (606)
      Deferred rent                                          (62)       (12)
      Other liabilities                                     (728)      (135)
      Income taxes payable                                   --        (234)
                                                       ---------    ---------
      Net cash provided by operating activities            1,310      2,578

Cash flows from investing activities:
  Capital expenditures, net                                 (114)      (968)
                                                       ---------    ---------
      Net cash used by investing activities                 (114)      (968)

Cash flows from financing activities:
  Net payments under line of credit agreement               (220)    (1,740)
  Repayments of capital lease obligations                   (153)      (143)
  Proceeds from exercise of stock options                     15        --
                                                       ---------    ---------
      Net cash used by financing activities                 (358)    (1,883)
                                                       ---------    ---------
Net increase (decrease) in cash and cash equivalents .       838       (273)
Cash and cash equivalents at beginning of period             979      1,320
                                                       ---------    ---------
Cash and cash equivalents at end of period               $ 1,817    $ 1,047
                                                       =========    =========

Supplemental Disclosures of Cash Flow Information and
 Non-cash Activities:
 Cash payments for interest                              $   564    $   533
 Cash (refunds) payments of income taxes, net             (1,534)       239
 Treasury stock received in exchange of options
  exercised                                                   --        214


           See notes to unaudited consolidated financial statements.

                                       7
<PAGE>

                   THE COSMETIC CENTER, INC. AND SUBSIDIARIES

              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                       FOR THE THREE AND SIX MONTHS ENDED
                        March 28, 1997 and March 29, 1996



Note 1  Summary of Significant Accounting Policies


Basis of Presentation

   The consolidated financial statements contained herein should be read in
   conjunction with the consolidated financial statements of The Cosmetic
   Center, Inc. (the "Company") for the year ended September 27, 1996.

   The accompanying consolidated financial statements are unaudited, but include
   all adjustments (consisting only of normal recurring adjustments) which
   management considers necessary for a fair presentation at March 28, 1997 and
   March 29, 1996 and for the three-month and six-month periods then ended. The
   accounting policies applied in the consolidated financial statements are
   consistent with the accounting policies applied in the consolidated financial
   statements of the Company for the year ended September 27, 1996.

   The results for the three-month and six-month periods ended March 28, 1997
   and March 29, 1996 are not necessarily indicative of results expected for the
   entire year. See Note 3.

Merchandise Inventories

   The Company's inventories, consisting primarily of cosmetics, fragrances,
   beauty aids, and related items, are valued at the lower of cost or market.
   Cost is determined using the weighted average cost method.

Rental Expenses

   Certain store leases provide for minimum rentals plus additional rentals
   computed as a percentage of net sales in excess of amounts specified in the
   lease as minimum rentals. The Company accrues percentage rent expense during
   interim periods based on actual net sales in excess of the prorated annual
   amounts specified in the related lease.

Note 2  Net Loss Per Share

   Net loss per common and common equivalent share are computed by dividing net
   loss by the weighted average number of common and when dilutive, common
   equivalent shares outstanding. Stock options are the only common share
   equivalents. There is no material difference between primary and fully
   diluted loss per share.

   In March 1997, the Financial Accounting Standards Board issued Statement of
   Financial Accounting Standards ("SFAS") No. 128, "Earnings Per Share," which
   establishes a new standard for computing and presenting earnings per share.
   SFAS No. 128 will be effective for interim and annual financial statements
   after December 15, 1997. The Company believes that the adoption of SFAS No.
   128 will not have a material impact on the Company's reported earnings per
   share.

                                       8

<PAGE>



                   THE COSMETIC CENTER, INC. AND SUBSIDIARIES

              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                       FOR THE THREE AND SIX MONTHS ENDED
                        March 28, 1997 and March 29, 1996



Note 3  Subsequent Events

   On April 25, 1997, pursuant to the Agreement and Plan of Merger among the
   Company, Revlon Consumer Products Corporation ("RCPC") and Prestige Fragrance
   & Cosmetics, Inc. ("PFC") dated as of November 27, 1996 and amended as of
   February 20, 1997 and March 20, 1997 (the "Merger Agreement"), the Company
   consummated the previously announced merger of PFC, a wholly owned subsidiary
   of RCPC, with and into the Company (the "Merger"), with the Company surviving
   the Merger. Pursuant to the Merger, RCPC received 8,479,335 shares of the
   Company's newly issued Class C Common Stock, par value $.01 per share (the
   "Class C Common Stock"), the only class of the Company's stock outstanding
   after the Merger, in exchange for its one share of PFC stock outstanding
   prior to the Merger. As a result of the Merger, the Company's stockholders
   were entitled to receive for each share of Class A Common Stock or Class B
   Common Stock they held one share of newly issued Class C Common Stock or, at
   each stockholder's election and subject to the limitation discussed below,
   $7.63 in cash (the "Cash Election"). Holders of options to purchase the
   Company's Class A Common Stock or Class B Common Stock with an exercise price
   of less than $7.63 were entitled to receive for each such option they held an
   equivalent option to purchase Class C Common Stock or, at each such
   optionholder's election and subject to the limitation discussed below, cash
   equal to the difference between $7.63 and the exercise price per share of
   such options. The right of stockholders and optionholders to receive cash was
   limited to an aggregate of 2,829,065 shares and options for shares. Holders
   of 3,688,440 shares of Class A Common Stock and Class B Common Stock in the
   aggregate and 86,500 options exercised their Cash Election so that after
   pro-ration 2,764,116 shares of Class A Common Stock and Class B Common Stock
   in the aggregate were accepted for Cash Election. The number of shares of
   Class C Common Stock owned by RCPC after the Merger constituted approximately
   85% of the outstanding Class C Common Stock after giving effect to the Cash
   Election. The Merger will be accounted for as a reverse acquisition using the
   purchase method of accounting. As a result, PFC is considered to be the
   acquiring entity and the Company the acquired entity for accounting purposes,
   even though the Company is the surviving legal entity. As a result, the
   historical financial information of PFC will be presented as the historical
   financial information of the Company in future SEC filings. Fair value
   adjustments will be made to the Company's assets and liabilities to the
   extent of RCPC's ownership interests in the Company post-Merger. In
   connection with the Merger, the Company currently expects that it will record
   business consolidation costs of approximately $4.2 million during fiscal 1997
   as a result of the integration of the operations of PFC with and into the
   Company.

      In connection with the Merger, on April 25, 1997 the Company entered into
   a new loan and security agreement (the "New Facility"), with the same lender
   from the Company's previous credit facility (the "Former Facility"). On April
   25, 1997, the Company paid the then outstanding balance of $14.0 million on
   the Former Facility with borrowings under the New Facility. On April 28,
   1997, the Company used approximately $21.2 million of borrowings under the
   New Facility to fund the Cash Election associated with the Merger. The New
   Facility, which expires April 30, 1999, provides up to $70 million of
   revolving credit tied to a borrowing base of 65% of eligible inventory, as
   defined in the New Facility. Borrowings under the New Facility are secured by
   the Company's accounts receivable and inventory (and proceeds therefrom).
   Under the New Facility, the Company may borrow at LIBOR plus 2.25% or at the
   bank's prime rate plus 0.5%. The Company also pays an unused line fee equal
   to one-quarter of one percent per annum. Interest is payable on a monthly
   basis except for interest on LIBOR rate loans with a maturity of less than
   three months, which is payable at the end of the LIBOR rate loan period and
   interest on LIBOR rate loans with a maturity of more than three months which
   is payable every three months. If the Company terminates the New Facility,
   the Company is obligated to pay a prepayment penalty of $700,000 if
   termination occurs before the first anniversary date and $175,000 if
   termination occurs after the first anniversary date. The New Facility
   contains various restrictive covenants and requires the Company to maintain a
   minimum tangible net worth and an interest coverage ratio.


                                       9

<PAGE>

      PFC executed a promissory note on April 25, 1997 in the principal amount
   of $13.3 million payable to RCPC, which note was assumed by the Company in
   connection with the Merger. Interest is payable quarterly at a rate
   of 11%. Principal is payable on demand, provided that during the term of the
   Company's New Facility, principal payments may not be made except from excess
   cash flow as defined in the New Facility.

      RCPC will supply Revlon products and provide certain services to the
   Company from and after the effective date of the Merger upon the terms and
   subject to the conditions of the Supply Agreement and Services Agreement,
   respectively, each as more fully described in the Proxy Statement/Prospectus
   included in the Company's registration statement on Form S-4 filed with the
   Securities and Exchange Commission under the Securities and Exchange Act of
   1933, as amended, on December 20, 1996 (File No. 333-18321) and the
   amendments thereto filed January 31, 1997, February 25, 1997, March 24, 1997
   and April 3, 1997 (the "Form S-4"). Additionally, the Company leased from
   RCPC the Holmdel, New Jersey headquarters, warehouse and distribution center
   and retail store and certain of PFC's employee stores from and after the
   effective date of the Merger upon the terms and subject to the conditions of
   the leases more fully described in the Proxy Statement/Prospectus included in
   the Form S-4.


                                       10

<PAGE>



Item 2.  Management's Discussion and Analysis of Financial Condition and
         Results of Operations



General

   The Company was founded in 1957, with its initial operations consisting of
   the sales of cosmetic products to wholesale customers. At March 28, 1997, the
   Company operated 68 stores under the name "The Cosmetic Center(R)" located in
   the greater metropolitan market areas of Washington, D.C.; Richmond,
   Virginia; Baltimore, Maryland; Chicago, Illinois; Charlotte/Raleigh/Durham,
   North Carolina; and Philadelphia, Pennsylvania. The Company sells
   approximately 25,000 brand name prestige and mass-merchandised cosmetic
   products.


Results of Operations

   Net sales for the six months ended March 28, 1997 were $66.2 million, a
   decrease of $4.6 million, or 6.5%, from the $70.8 million in net sales for
   the six months ended March 29, 1996. Net sales for the three months ended
   March 28, 1997 were $27.3 million, a decrease of $2.0 million, or 6.8%, from
   the $29.3 million in net sales for the three months ended March 29, 1996.
   These decreases are primarily attributable to the closing of nine
   unprofitable stores in the Atlanta market in fiscal year 1996, a slight
   decline in comparable store sales due primarily to soft
   fragrance sales and, for the three months ended March 28, 1997, decreased
   promotional activity. The Company operated 68 stores at March 28, 1997 and 76
   stores at March 29, 1996. Comparable store sales for the three months ended
   March 28, 1997 declined slightly to $26.8 million compared to $27.3 million
   for the three months ended March 29, 1996 for the reasons stated above.

   Cost of sales, including buying, occupancy and distribution expenses ("COS"),
   was $51.3 million (77.5% of net sales) for the six months ended March 28,
   1997 versus $55.4 million (78.2% of net sales) for the six months ended March
   29, 1996. COS was $21.0 million (76.9% of net sales) for the three months
   ended March 28, 1997 versus $23.0 million (78.5% of net sales) for the three
   months ended March 29, 1996. COS as a percentage of net sales for the three
   months and six months ended March 28, 1997 improved primarily due to the
   direct purchase of professional hair care products, lower inventory shrinkage
   and, for the three months ended March 28, 1997, a lower mix of products sold
   on promotion.

   Selling, general and administrative ("SG&A") expenses were $14.5 million
   (21.9% of net sales) for the six months ended March 28, 1997 versus $15.3
   million (21.6% of net sales) for the six months ended March 29, 1996. SG&A
   expenses were $7.4 million (27.1% of net sales) for the three months ended
   March 28, 1997 versus $7.6 million (25.9% of net sales) for the three months
   ended March 29, 1996. SG&A expenses as a percentage of net sales increased in
   the three months and six months ended March 28, 1997, primarily as a result
   of increased payroll costs, lower comparable store net sales, partially
   offset by the elimination of costs pertaining to the nine unprofitable stores
   in the Atlanta market which were closed in fiscal 1996 and, in the three
   months ended March 28, 1997, lower advertising revenue associated with the
   above-mentioned decreased promotional activity.

   Interest expense was $0.6 million for the six months ended March 28, 1997
   versus $0.5 million for the six months ended March 29, 1996. Interest expense
   was $0.3 million for the three months ended March 28, 1997 versus $0.2
   million for the three months ended March 29, 1996. The increase in interest
   expense is primarily attributable to higher outstanding borrowings under the
   Former Credit facility during the 1997 periods to support working capital
   requirements.


Liquidity and Capital Resources

   Net cash provided by operating activities was $1.3 million for the six months
   ended March 28, 1997 and $2.6 million for the six months ended March 29,
   1996. The decrease resulted primarily from the fact that a greater portion of
   the 1996 Christmas season merchandise was purchased subsequent to September
   27, 1996 as a result of improved inventory management (specifically, a
   greater portion of the 1995 Christmas season merchandise had been purchased
   prior to September 29, 1995), partially offset by a refund of prior years'
   income taxes in the 1997 period. Net cash used by investing activities was
   $0.1 million for the six months ended March 28, 1997 and $1.0 million for 
   the six months ended March 29, 1996. The decrease resulted primarily from 
   the absence of new store
                                       11

<PAGE>

   openings in the 1997 period. Net cash used by financing activities was $0.4
   million for the six months ended March 28, 1997 and $1.9 million for the six
   months ended March 29, 1996. The decrease resulted primarily from lower
   repayments of borrowings under the Former Facility in the 1997 period than
   under the credit facility in effect during the 1996 period.

   On April 25, 1997, pursuant to the Merger Agreement, the Company consummated
   the previously announced merger of PFC, a wholly owned subsidiary of RCPC,
   with and into the Company, with the Company surviving the Merger. See Item 1
   of this Form 10-Q, Note 3 of Notes to the Company's Unaudited Consolidated
   Financial Statements.

   The Former Facility, which was scheduled to expire on October 31, 1999,
   provided a revolving credit facility of up to $25 million based upon a
   borrowing base of 50% of eligible inventory, as defined in the Former
   Facility. Borrowings under the Former Facility were secured by all of the
   Company's assets except for fixed assets. Under the Former Facility the
   Company borrowed at LIBOR plus 2.0% or at the bank's prime rate plus 0.5%.
   The Company also paid an unused line fee equal to one-quarter of one percent
   per annum. Interest was payable on a monthly basis. The consent of the lender
   was required to consummate the Merger and was secured. The Former Facility
   required the Company to be in compliance with a minimum tangible net worth
   covenant. At March 28, 1997, the Former Facility had an outstanding balance
   of $12 million.

   On April 25, 1997 in connection with the Merger the Company executed the New
   Facility. The Company paid the then outstanding balance of $14.0 million on
   the Former Facility with borrowings under the New Facility. On April 28,
   1997, the Company used approximately $21.2 million of borrowings under the
   New Facility to fund the Cash Election associated with the Merger. Under the
   New Facility, which expires April 30, 1999, the Company may borrow the lesser
   of $70 million or 65% of eligible inventory, as defined in the New Facility.
   Borrowings under the New Facility are secured by the Company's accounts
   receivable and inventory (and proceeds therefrom). Under the New Facility,
   the Company may borrow at LIBOR plus 2.25% or at the bank's prime rate plus
   0.5%. The Company also pays an unused line fee equal to one-quarter of one
   percent per annum. Interest is payable on a monthly basis except for interest
   on LIBOR rate loans with a maturity of less than three months, which is
   payable at the end of the LIBOR rate loan period and interest on LIBOR rate
   loans with a maturity of more than three months which is payable every three
   months. If the Company terminates the New Facility, the Company is obligated
   to pay a prepayment penalty of $700,000 if the termination occurs before the
   first anniversary date and $175,000 if the termination occurs after the first
   anniversary date. The New Facility contains various restrictive covenants and
   requires the Company to maintain a minimum tangible net worth and an interest
   coverage ratio.

   The Company expects that its future cash needs will result primarily from the
   cash required in connection with the payment of costs and expenses associated
   with the Merger, costs to integrate the operations of the Company and PFC,
   costs to expand the operations of the Company following the Merger, including
   capital expenditures, and debt service on the New Facility. The Company
   estimates that capital expenditures for 1997 will be approximately $2 
   million. The Company believes that funds available from the New Facility and
   internally generated funds will provide sufficient cash to meet the
   Company's cash needs for the next year.

      Pursuant to a Tax Sharing Agreement, each of the subsidiaries of RCPC,
   including, from the effective date of the Merger, the Company, has agreed to
   pay to RCPC an amount equal to its liability for federal, state and local
   income taxes (including estimated taxes), if any. Since the payments to be
   made by subsidiaries of RCPC, including, from the effective date of the
   Merger, the Company, to RCPC under the Tax Sharing Agreement will be
   determined by the amount of taxes that such subsidiaries would otherwise have
   to pay if they were to file separate federal, state or local income tax
   returns, the Tax Sharing Agreement will benefit RCPC to the extent RCPC can
   offset the taxable income generated by such subsidiaries, including, from the
   effective date of the Merger, the Company, against losses and tax credits
   generated by RCPC and its other subsidiaries. The Company anticipates that,
   as a result of anticipated operating losses, no significant federal tax
   payments or payments in lieu of taxes pursuant to the Tax Sharing Agreement
   will be required by the Company for 1997.

Forward Looking Statements

    This quarterly report on Form 10-Q for the quarter ended March 28, 1997 as
   well as other public documents of the Company contains forward looking
   statements which involve risks and uncertainties. The Company's actual
   results may differ materially from those discussed in such forward looking
   statements. Such statements include, without limitation, statements regarding
   the amount of costs and expenses associated with the Merger, costs to

                                       12

<PAGE>

   integrate the operations of the Company and PFC, costs to expand the
   operations of the Company, the amount of required capital expenditures, the
   Company's ability to develop relationships with the manufacturers of
   professional hair care products, expectations as to the Company's cash flows
   from operations and the pro forma financial information and assumptions
   contained in Item 5. Readers are urged to consider statements which use the
   terms "believes," "no reason to believe," "expects," "plans," "intends,"
   "estimates," "anticipated," "or "anticipates" to be uncertain and forward
   looking. In addition to factors that may be described in the Company's
   Commission filings, including this filing, the following factors, among
   others, could cause the Company's actual results to differ materially from
   those expressed in any forward looking statements made by the Company: the
   inability to generate sufficient cash flows from operations to fund new store
   openings, unanticipated costs and expenses associated with the Merger,
   unanticipated costs to integrate the operations of the Company and PFC and to
   expand the operations of the Company, unanticipated capital expenditures,
   including costs associated with store openings and closings, actions by
   competitors that may have greater capital resources than the Company,
   including combinations within the retail industry and successful new retail
   store concepts, the lack of viability of the Company's salon business, the
   unavailability of product or the loss of suppliers, including secondary
   source suppliers, the inability to secure sufficient professional hair care
   products, general business and economic conditions, and other factors
   described from time to time in the Company's reports filed with the SEC. The
   Company wishes to caution readers not to place undue reliance on any such
   forward looking statements, which statements are made pursuant to the Private
   Securities Litigation Reform Act of 1995 and, as such, speak only as of the
   date made.

Seasonality

   The Company's business is seasonal, with the highest volume of net sales
   occurring during the period from October through December.

Inflation

   While inflation has not had, and the Company does not expect it to have, a
   material impact upon operating results, there can be no assurance that the
   Company's business will not be affected by inflation in the future.


                                       13

<PAGE>



                                     PART II

Item 2.  Changes in Securities

    (a) As described above in "Management's Discussion and Analysis of Financial
   Condition and Results of Operations-Liquidity and Capital Resources," as a
   result of the Merger, outstanding Class A Common Stock and Class B Common
   Stock was converted into newly authorized Class C Common Stock, subject to
   the Cash Election. Following the Merger, the Class C Common Stock is the
   Company's only class of outstanding common stock.

    (b) Not applicable.

    (c) Pursuant to the Merger, on April 25, 1997 8,479,335 shares of Class C
   Common Stock were issued to RCPC. The issuance of the shares to RCPC was
   exempt from registration under the Securities Act pursuant to Section 4(2) of
   the Securities Act as a transaction not involving a public offering.

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

    At the Annual Meeting of Stockholders held on April 24, 1997, the Company's
   stockholders voted on the following proposals, which resulted in the approval
   of the proposals listed in 1, 3 and 4 below:

    1) To adopt the Merger Agreement, pursuant to which, among other things, (a)
   PFC would merge with and into the Company, (b) the Company's certificate of
   incorporation would be amended to authorize the issuance of up to 40,000,000
   shares of Class C Common Stock, (c) the outstanding Class A Common Stock and
   Class B Common Stock would be converted into Class C Common Stock (subject to
   the Cash Election) and (d) the nine nominees to the Company's board of
   directors listed in the Company's Proxy Statement/ Prospectus, which is
   included in the Company's registration statement on Form S-4, would be
   appointed upon consummation of the Merger.

              AFFIRMATIVE 1,057,435 NEGATIVE 3,427 ABSTAINED 1,050

       APPROVED


   2) To approve the amendment to the Company's certificate of incorporation to
   repeal the classification of the board of directors.

              AFFIRMATIVE 1,058,443 NEGATIVE 1,627 ABSTAINED 2,893

     NOT APPROVED

   3) To elect two Class II directors who were replaced in connection with the
   appointment of the nine directors upon consummation of the Merger.

         Nominee: Mark S. Weinstein

                AFFIRMATIVE 1,052,149 NEGATIVE - ABSTAINED 10,814

         Nominee: Donald R. Rogers

                AFFIRMATIVE 1,052,649 NEGATIVE - ABSTAINED 10,314

        BOTH ELECTED

   4)  To approve the Company's 1997 Stock Option Plan.

               AFFIRMATIVE 997,523 NEGATIVE 60,664 ABSTAINED 4,776

       APPROVED


                                       14

<PAGE>



                                 PART II (con't)


Item 5.   Other Information

    Given the fact that the Merger of PFC with and into the Company was
   effective April 25, 1997, Part I of this Form 10-Q for the quarterly period
   ended March 28, 1997 does not include any financial information for PFC. The
   Company has determined to include in this Item 5 Financial Statements and
   Management's Discussion and Analysis for PFC for its quarter ended March 31,
   1997 and certain Pro Forma Financial Information for the Company.

   1.  Financial Statements of Prestige Fragrance & Cosmetics, Inc.
       Condensed Balance Sheets
          as of December 31, 1996 and March 31, 1997
       Unaudited Condensed Statements of Operations
          for the three months ended March 31, 1997 and 1996
       Unaudited Condensed Statements of Cash Flows
          for the three months ended March 31, 1997 and 1996
       Notes to Unaudited Condensed Financial Statements

   2. Management's Discussion and Analysis of Financial Condition and Results of
   Operations of Prestige Fragrance & Cosmetics, Inc.

   3.  Pro Forma Financial Information for The Cosmetic Center, Inc.
       Unaudited Condensed Consolidated Pro Forma Balance Sheet
          as of March 31, 1997
       Unaudited Condensed Consolidated Pro Forma Statement of Operations for
          the three months ended March 31, 1997
       Notes to Unaudited Condensed Consolidated Financial Statements


                                       15


<PAGE>



                      PRESTIGE FRAGRANCE & COSMETICS, INC.
                            CONDENSED BALANCE SHEETS
            (dollars in thousands, except share and per share data)

                                                      March 31,     December 31,
               ASSETS                                    1997           1996
                                                     (Unaudited)
Current assets:
   Cash and cash equivalents                           $   1,515    $  3,479
   Inventories, net                                       31,178      31,713
   Prepaid expenses and other                                773         773
      Total current assets                                33,466      35,965
Property and equipment, net                                7,207       7,616
Other assets                                               1,225         589
Intangible asset                                           1,441       1,451
      Total assets                                     $  43,339   $  45,621

LIABILITIES AND STOCKHOLDER'S EQUITY

Current liabilities:
   Accounts payable                                     $  1,532    $  2,242
   Accrued expenses and other                              1,406       2,385
      Total current liabilities                            2,938       4,627
Due to RCPC                                               14,553      12,315

Stockholder's equity:
   Common stock, par value $1.00 per share, 1,000
   shares authorized, 1 share
   issued and outstanding                                    --          --
   Additional paid-in capital                             28,536      28,536
   (Accumulated deficit) Retained earnings                (2,688)        143
      Total stockholder's equity                          25,848      28,679
      Total liabilities and stockholder's equity        $ 43,339    $ 45,621





             See notes to unaudited condensed financial statements.


                                       16

<PAGE>



                      PRESTIGE FRAGRANCE & COSMETICS, INC.
                  UNAUDITED CONDENSED STATEMENTS OF OPERATIONS
                             (dollars in thousands)


                                                    Three Months Ended
                                                        March 31,
                                                     1997          1996

Net sales                                          $ 12,859    $ 12,707
Cost of sales, including buying, occupancy and
  distribution                                        8,703       8,827
  Gross margin                                        4,156       3,880
Selling, general and administrative expenses          6,698       6,833

  Operating loss                                     (2,542)     (2,953)
Intercompany interest                                   274         147

Loss before income taxes                             (2,816)     (3,100)

Provision for income taxes                               15          15

Net loss                                            $ (2,831)  $ (3,115)




             See notes to unaudited condensed financial statements.


                                       17

<PAGE>

                      PRESTIGE FRAGRANCE & COSMETICS, INC.
                  UNAUDITED CONDENSED STATEMENTS OF CASH FLOWS
                             (dollars in thousands)

                                                             Three Months Ended
                                                                   March 31,
                                                               1997        1996

CASH FLOWS FROM OPERATING ACTIVITIES:
 Net loss                                                    $(2,831)   $(3,115)
 Adjustments to reconcile net loss to net cash (used for)
   provided by operating activities:
   Depreciation and amortization                                 678        460
   Change in assets and liabilities:
     Decrease (increase) in inventories                          535     (4,323)
     Decrease in prepaid expenses and other current assets        --         66
     Decrease in accounts payable                               (710)       (44)
     (Decrease) increase in accrued expenses and other
       current liabilities                                      (979)       176
     Increase in other assets                                   (636)      --
 Net cash used for operating activities                       (3,943)    (6,780)

 CASH FLOWS FROM INVESTING ACTIVITIES:
 Capital expenditures                                           (259)    (1,508)
 Net cash used for investing activities                         (259)    (1,508)

 CASH FLOWS FROM FINANCING ACTIVITIES:
 Increase in Due to RCPC                                       2,238      6,356
 Net cash provided by financing activities                     2,238      6,356
   Net decrease in cash                                       (1,964)    (1,932)
   Cash at beginning of period                                 3,479      3,421
   Cash at end of period                                    $  1,515    $ 1,489


             See notes to unaudited condensed financial statements.


                                       18


<PAGE>



                      PRESTIGE FRAGRANCE & COSMETICS, INC.
                NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

(1)  Basis of Presentation

         During the quarter ended March 31, 1997 PFC was a wholly owned
subsidiary of RCPC, which is an indirect subsidiary of Mafco Holdings Inc.
("Mafco Holdings").

         The consolidated financial statements contained herein should be
read in conjunction with PFC's consolidated financial statements for the
year ended December 31, 1996 included in the Form S-4.

         The accompanying condensed financial statements are unaudited. In
management's opinion, all adjustments (consisting of only normal recurring
accruals) necessary for a fair presentation have been made.

         The results of operations and financial position, including working
capital, for interim periods are not necessarily indicative of those to be
expected for a full year, due, in part, to seasonal fluctuations which are
normal for PFC's business.

         PFC has made a number of estimates and assumptions relating to the
assets and liabilities, the disclosure of contingent assets and liabilities and
the reporting of revenues and expenses to prepare these financial statements in
conformity with generally accepted accounting principles. Actual results could
differ from those estimates.

                                       19

<PAGE>



                      PRESTIGE FRAGRANCE & COSMETICS, INC.
         MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
                             RESULTS OF OPERATIONS

Overview

         PFC was incorporated on July 6, 1987 and operates a chain of retail
stores that sells a wide range of first quality, first quality excess, returned
and refurbished and discontinued brand name cosmetics, fragrances and personal
care products at discounted prices. As of March 31, 1997, PFC owned and operated
195 retail outlet stores located principally in outlet malls in 43 states. The
stores operate under the names "Prestige Fragrance & Cosmetics," "Colours &
Scents," "Visage" and "The Cosmetic Warehouse," with seven stores operated
principally for employees of RCPC. With its outlet mall focus, PFC has sought to
provide an outlet for major cosmetic manufacturers to sell their products
without competing directly with the retailers that purchase products from these
same manufacturers.

         During the three-month period ended March 31, 1997, RCPC provided
certain services to PFC for which PFC was charged for direct and indirect
expenses incurred by RCPC in providing such services. Such services include
insurance and risk management services, travel, legal services, treasury and
finance services, customer service, information systems and audit services,
among others. Additionally, RCPC provided the services of certain employees at
PFC's warehouse and distribution center for which PFC was charged. RCPC will
provide similar services to the Company from and after the effective date of the
Merger upon the terms and subject to the conditions of the Service Agreement
more fully described in the Proxy Statement/Prospectus included in the Form S-4.

         During the three-month period ended March 31, 1997, PFC employees were
eligible to participate in RCPC sponsored employee pension benefits plans,
including the Revlon Employee's Savings and Investment Plan and Revlon
Employees' Retirement Plan and Revlon sponsored employee welfare benefit plans,
including medical, dental, life and disability insurance coverage.

         During the three-month period ended March 31, 1997, PFC occupied its
headquarters, warehouse and distribution center in Holmdel, New Jersey and five
employee stores located at RCPC facilities and paid RCPC charges therefor, and
PFC purchased products from RCPC. The Company leased from RCPC the Holmdel, New
Jersey headquarters, warehouse and distribution center and retail store and
certain of PFC's employee stores from and after the effective date of the Merger
upon the terms and subject to the conditions of the leases more fully described
in the Proxy Statement/Prospectus included in the Form S-4. Additionally, RCPC
will supply Revlon products to the Company from and after the effective date of
the Merger upon the terms and subject to the conditions of the Supply Agreement
more fully described in the Proxy Statement/Prospectus included in the Form S-4.

         PFC's working capital and capital expenditure needs in the past had
been satisfied through interest-bearing obligations payable to RCPC. The
weighted average interest rate on such obligations was approximately 10% for
1996. PFC executed a promissory note on April 25, 1997 in the principal amount
of $13.3 million payable to RCPC, which note was assumed by the Company.
Interest is payable quarterly at 11%. Principal is payable on demand provided
that during the term of the Company's New Facility principal payments may not be
made except from excess cash flow as defined in the New Facility.

                                       20

<PAGE>

                      PRESTIGE FRAGRANCE & COSMETICS, INC.
         MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
                             RESULTS OF OPERATIONS

Results of Operations

For the Quarter Ended March 31, 1997 Compared to the Quarter Ended March 31,
1996.

         Net sales were $12.9 million and $12.7 million for the first quarter of
1997 and 1996, respectively, an increase of $0.2 million or 1.6%, primarily as a
result of 16 new stores opened in 1996 offset in part by sales lost due to five
store closings in the ordinary course of business. Comparable store sales
(sales from stores in operation for the full period in both fiscal periods) were
$11.9 million and $12.4 million for the first quarter of 1997 and 1996,
respectively, a decrease of $0.5 million in the 1997 period, due primarily
to decreased promotional activity.

         As a percentage of net sales, cost of sales, including buying,
occupancy and distribution expenses ("cost of sales"), was 67.7% for the first
quarter of 1997, a decrease from 69.5% for the first quarter of 1996. Cost of
sales as a percentage of net sales decreased in the 1997 period as a result of
increased sales volume of higher margin products and a lower mix of products
sold on promotion.

         As a percentage of net sales, SG&A expenses were 52.1% for the first
quarter of 1997, a decrease from 53.8% for the first quarter of 1996. SG&A as a
percentage of net sales improved primarily as a result of reductions in store
labor costs.

Financial Condition, Liquidity and Capital Resources

         Net cash used for operating activities was $3.9 million and $6.8
million for the first quarters of 1997 and 1996, respectively. The improvement
in the net cash used for operating activities for the first quarter of 1997 as
compared to the first quarter of 1996 resulted primarily from improved working
capital management, partially offset by costs incurred in connection with the
Merger.

         Net cash used for investing activities was $0.3 million and $1.5
million for the first quarters of 1997 and 1996, respectively. The improvement
in the net cash used for investing activities for the first quarter of 1997 as
compared to the first quarter of 1996 resulted from the fact that the 1997
period did not include capital expenditures for point-of-sale registers, which
were included in the first quarter of 1996.

         Net cash provided by financing activities was $2.2 million and $6.4
million for the first quarter of 1997 and 1996, respectively. The decrease in
the net cash provided by financing activities for the first quarter of 1997 as
compared to the first quarter of 1996 resulted from lower financing provided by
RCPC to PFC.


                                       21

<PAGE>

                         PRO FORMA FINANCIAL INFORMATION


The following unaudited pro forma financial statements give effect to the Merger
in a transaction that will be accounted for as a reverse acquisition. The
unaudited pro forma condensed consolidated balance sheet is based on the
individual balance sheets of the Company and PFC appearing in Items 1 and 5,
respectively, of this Form 10-Q and has been prepared to reflect the Merger as
if it had occurred on March 31, 1997. In connection with the Merger, the Company
adopted PFC's fiscal year, which was a calendar year, and subsequently changed
its fiscal year to a 52- or 53- week year ending on or about December 31. The
unaudited pro forma condensed consolidated statements of operations are based on
the individual statements of operations of the Company and PFC appearing
elsewhere in this Form 10-Q, and combine the results of operations of the
Company for the three months ended March 28, 1997 with those of PFC for the
three months ended March 31, 1997, as if the Merger had occurred at January 1,
1997. The unaudited pro forma financial statements should be read in conjunction
with the notes to the unaudited consolidated pro forma financial information and
the separate historical financial statements and notes thereto of the Company
and PFC included elsewhere in this Form 10-Q. The detailed assumptions used to
prepare the unaudited condensed pro forma financial information are contained in
the notes to the unaudited pro forma financial information. THE PRO FORMA
COMBINED FINANCIAL DATA ARE INTENDED FOR INFORMATIONAL PURPOSES ONLY AND ARE NOT
NECESSARILY INDICATIVE OF THE FINANCIAL POSITION OR FUTURE RESULTS OF OPERATIONS
OF THE COMPANY POST-MERGER OR OF THE FINANCIAL POSITION OR THE RESULTS OF
OPERATIONS OF THE COMPANY POST-MERGER THAT WOULD HAVE ACTUALLY OCCURRED HAD THE
MERGER BEEN IN EFFECT AS OF THE DATE OR FOR THE PERIODS PRESENTED. FINAL
ADJUSTMENTS MAY DIFFER FROM THE PRO FORMA ADJUSTMENTS PRESENTED HEREIN. SEE ITEM
2 OF THIS FORM 10-Q "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITIONS AND RESULTS OF OPERATIONS -- FORWARD LOOKING STATEMENTS."


                                       22



<PAGE>

                   THE COSMETIC CENTER, INC. AND SUBSIDIARIES
            UNAUDITED CONDENSED CONSOLIDATED PRO FORMA BALANCE SHEET
                                 MARCH 31, 1997
            (dollars in thousands, except share and per share data)


<TABLE>
<CAPTION>


                                                             Historical
                                                                                            Pro Forma            Pro
           ASSETS                                             Company          PFC         Adjustments          Forma
<S>                                                         <C>             <C>             <C>
Current assets:
  Cash and cash equivalents.................................$     1,817     $   1,515       $                $     3,332
  Accounts receivable, net...................................     1,264                                            1,264
  Inventories................................................    53,197        31,178                             84,375
  Prepaid expenses and other.................................     2,839           773          (1,582)(a)          2,030
      Total current assets...................................    59,117        33,466          (1,582)            91,001
Property, plant and equipment, net...........................     7,425         7,207                             14,632
Other assets.................................................     1,249         1,225          (1,587)(a)            887
Intangible asset.............................................                   1,441           5,950 (a)          7,891
                                                                                                  500 (b)
      Total assets..........................................$    67,791     $  43,339       $   3,281        $   114,411

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
  Accounts payable..........................................$    12,630     $   1,532       $                $    14,162
  Accrued expenses and other.................................     4,072         1,406           5,611 (a)         15,289
                                                                                                4,200 (c)
      Total current liabilities..............................    16,702         2,938           9,811             29,451
Due to RCPC .................................................                  14,553                             14,553
Long-term debt -- third parties..............................    12,042                        34,839 (b)         34,881
                                                                                              (12,000)(b)
Other long-term liabilities..................................     1,911                                            1,911

Stockholders' equity:
  Class A common stock, $.01 par value; authorized
      5,000,000 shares; issued and outstanding 2,717,104 shares      27                           (27)(d)
  Class B common stock, $.01 par value; authorized
      5,000,000 shares; issued and outstanding 1,582,780 shares      16                           (16)(d)
  Class C common stock, $.01 par value; authorized
      40,000,000 shares; issued and outstanding 10,015,103
      shares................................................                                      101 (d)             101
  Additional paid-in capital.................................    21,401        28,536         (22,339)(b)          40,402
                                                                                              (21,401)(d)
                                                                                               15,692 (d)
                                                                                               21,343 (d)
                                                                                               13,067 (a)
                                                                                              (37,136)(a)
                                                                                               21,239 (a)
  Retained earnings (Accumulated deficit)                        15,692        (2,688)        (15,692)(d)         (6,888)
                                                                                               (4,200)(c)
      Total stockholders' equity.............................    37,136        25,848         (29,369)            33,615
      Total liabilities and stockholders' equity............$    67,791     $  43,339       $   3,281        $   114,411
</TABLE>


                                       23

<PAGE>


                   THE COSMETIC CENTER, INC. AND SUBSIDIARIES
       NOTES TO UNAUDITED CONDENSED CONSOLIDATED PRO FORMA BALANCE SHEET
                                 MARCH 31, 1997
                             (dollars in thousands)



     The following  assumptions used in determining the pro forma adjustments to
the historical financial position give effect to the reverse purchase accounting
for the  acquisition  of the Company by PFC, the issuance of the Company Class C
common stock and the New Facility as follows:



<TABLE>
<CAPTION>




                                                                                                               (dollars in
                                                                                                                 thousands)
<S>                                                                                                             <C>
(a)Purchase accounting to reflect the fair value of the Company:
   Increase in intangible assets due to the additional excess in cost over estimated fair value of the
           net assets of the Company........................................................................    $    5,950
   Decrease in prepaid expenses and other due to an increase in the valuation allowance for the current
           deferred tax asset...............................................................................        (1,582)
   Decrease in other assets in connection with deferred acquisition costs for professional services incurred
           and an increase in the valuation allowance for the long term deferred tax asset..................        (1,587)
   Increase in accrued expenses to reflect transaction costs related to severance for employees ($3,800) and
     professional services ($1,811).........................................................................        (5,611)
    Cost of the Company (assumes a value of $7.63 per share to the extent of RCPC's ownership interest).....       (13,067)
   The Company book value...................................................................................        37,136
   Less treasury stock acquired in the Cash Election........................................................       (21,239)
                                                                                                                 $       -
   The allocations above are based upon a preliminary assessment that the
   recorded tangible assets and liabilities of the Company approximate their
   fair value and are subject to a more detailed review subsequent to the
   Merger.

(b)Adjustment to reflect additional borrowings to finance the Cash Election:
   Increase in Long-term debt -- third parties due to borrowings under the New Facility to fund the
     Cash Election and refinance existing Long-term debt -- third parties and fees
     and expenses related to the Merger.....................................................................    $  (34,839)
   Increase in other assets due to costs incurred to effect the New Facility................................           500
   Repayment of the Company's Note payable bank with proceeds from the New Facility.........................        12,000
   Decrease in Additional paid-in capital to reflect the cost of the Cash Election ($21,239) and other costs
     of the Merger ($1,100).................................................................................        22,339
                                                                                                                 $      -
(c)Additional non-recurring expenses expected to be incurred after the Merger to
     consolidate overhead expenses and eliminate duplicative functions:
   PFC severance and relocation costs.......................................................................     $   1,530
   Information system integration costs.....................................................................         1,600
   Inventory relocation and integration costs...............................................................         1,070
                                                                                                                 $  (4,200)

(d)Adjustment for the issuance of the Company Class C common stock in exchange
   for PFC common stock:
   Elimination of the Company Class A common stock in connection with the Merger............................     $      27
   Elimination of the Company Class B common stock in connection with the Merger............................            16
   Issuance of the Company Class C common stock in connection with the Merger...............................          (101)
   Decrease in Additional paid-in capital to reflect its elimination in the Merger..........................        21,401
   Increase in Additional paid-in capital due to elimination of the the Company's retained earnings.........       (15,692)
   Increase in Additional paid-in capital due to issuance of the Company Class C common stock in
      connection with the Merger............................................................................       (21,343)
   Decrease in the Company's retained earnings to reflect its elimination in the Merger.....................        15,692
                                                                                                                $        -
</TABLE>


                                       24

<PAGE>



                   THE COSMETIC CENTER, INC. AND SUBSIDIARIES
       UNAUDITED CONDENSED CONSOLIDATED PRO FORMA STATEMENT OF OPERATIONS
                        Three Months ended March 31, 1997
            (dollars in thousands, except per share and share data)


<TABLE>
<CAPTION>
<S>                                                               <C>         <C>        <C>                  <C>
                                                                         Historical
                                                                  --------------------
                                                                                             Pro Forma          Pro
                                                                   Company      PFC         Adjustments        Forma
                                                                  ---------   -------      -------------     -----------
Net sales ...................................................... $ 27,337   $  12,859      $       -          $   40,196
Cost of sales, including buying, occupancy and distribution ....   21,037       8,703              -              29,740
                                                                 ---------  ----------     -------------     -----------
Gross margin ...................................................    6,300       4,156              -              10,456
Selling, general and administrative expenses ...................    7,373       6,698              37 (a)         14,108
                                                                 ---------  ----------     -------------     -----------
Operating loss .................................................   (1,073)     (2,542)            (37)            (3,652)
Other (income) expense .........................................      (17)         -               63 (b)             46
Interest expense ...............................................      297         274             425 (c)            996
                                                                 ---------  ----------     -------------     -----------
Loss from operations
  before income taxes ..........................................   (1,353)     (2,816)           (524)            (4,694)
                                                                 ---------  ----------     -------------     -----------
(Benefit) provision for income taxes............................     (548)         15               -               (533)
                                                                 ---------  ----------     -------------     -----------
Net loss ....................................................... $   (805)  $  (2,831)     $     (524)         $  (4,161)
                                                                 =========  ==========     =============     ===========
Loss per common and common equivalent
  shares outstanding ........................................... $  (0.19)                                     $   (0.41)
                                                                 =========                                   ===========

Weighted average common and common equivalent shares
  outstanding................................................... 4,324,022                  5,715,219 (d)     10,039,241
                                                                 =========                 =============     ===========
</TABLE>

                                       25

<PAGE>




                   THE COSMETIC CENTER, INC. AND SUBSIDIARIES
  NOTES TO UNAUDITED CONDENSED CONSOLIDATED PRO FORMA STATEMENTS OF OPERATIONS
                 (dollars in thousands, except per share data)



     The following  assumptions used in determining the pro forma adjustments to
the historical financial position give effect to the reverse purchase accounting
for the  acquisition  of the Company by PFC, the issuance of the Company Class C
common stock and the New Facility as follows:


<TABLE>
<CAPTION>






                                                                                       Three months ended
                                                                                        March 31, 1997
<S>                                                                                   <C>
(a) Amortization of intangibles resulting from purchase costs
    incurred in the Merger based upon a 40-year life................................. $          (37)

(b) Amortization of costs incurred to effect the New Facility based upon a
    2-year life...................................................................... $          (63)

(c) The adjustment to interest expense results from debt incurred to complete
    the Cash Election and the Merger based upon borrowings of $21,239
    bearing interest at 8% per annum................................................. $          425

(d) The adjustment to common shares outstanding results from the following
    transactions both as if they took place as of the beginning of the period:
    (i) shares acquired in the Cash Election.........................................     (2,764,116)
    (ii) shares issued in the Merger.................................................      8,479,335
                                                                                           5,715,219
</TABLE>


                                       26


<PAGE>



Item 6.   EXHIBITS AND REPORTS ON FORM 8-K

   (A)  Exhibits

       EXHIBIT 4 - Loan and Security Agreement dated as of April 25, 1997 by and
       among the Company, BankAmerica Business Credit, Inc., as agent, and the
       lenders parties thereto (incorporated herein by reference to Exhibit 5 to
       the Schedule 13D filed on behalf of RCPC and Mafco Holdings dated May 5,
       1997 (the "Schedule 13D").

       EXHIBIT 27 - Financial Data Schedule as of March 28, 1997


   (B)  Reports on Form 8-K

    The Company filed a report on Form 8-K on May 8, 1997 (the "Form 8-K")
   reporting the Merger of PFC with and into the Company, the change in the
   Company's independent accountants and the change in the Company's fiscal year
   end.

                                       27

<PAGE>



                                   SIGNATURES

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


                               THE COSMETIC CENTER, INC.
                                          (Registrant)


Date: May 12, 1997                      By /s/ I. Howard Diener
                                          I. HOWARD DIENER
                                          President and Chief Executive Officer


Date: May 12, 1997                      By /s/ Bruce E. Strohl
                                        BRUCE E. STROHL
                                        Senior Vice President - Finance and
                                        Chief Financial Officer

                                       28

<PAGE>