SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

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

                      FOR THE QUARTER ENDED MARCH 31, 2003


                         Commission file number: 0-19298


                              VARSITY BRANDS, INC.
             (Exact name of registrant as specified in its charter)

         DELAWARE                                         22-2890400
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
incorporation or organization)


              6745 LENOX CENTER COURT, SUITE 300, MEMPHIS, TN 38115
              (Address of principal executive offices) (Zip code)

                                 (901) 387-4300
              (Registrant's telephone number, including area code)

                                     (NONE)
     (Former name, former address and former fiscal year, if changed since
                                  last report)


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1935 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 registrant's classes of
common stock, as of the latest practicable date.

                   9,592,250 Common Shares as of May 12, 2003

                                       1
<PAGE>

                              VARSITY BRANDS, INC.

                                      INDEX

<TABLE>
<CAPTION>
                                                                                      Page
                                                                                      ----
<S>                                                                                    <C>
Form 10-Q Cover Page                                                                   1
Form 10-Q Index                                                                        2
Part I.  Financial Information:
            Item 1.  Financial Statements:
                  Condensed Consolidated Balance Sheets                                4
                  Condensed Consolidated Statements of Operations                      5
                  Condensed Consolidated Statements of Stockholders' Equity            6
                  Condensed Consolidated Statements of Cash Flows                      7
                  Notes to Condensed Consolidated Financial Statements                 8
            Item 2.  Management's Discussion and Analysis of
                     Financial Condition and Results of Operations                     13
            Item 3.  Quantitative and Qualitative Disclosures about Market Risk        20
            Item 4.  Controls and Procedures                                           20
Part II. Other Information:
            Item 1.  Legal Proceedings                                                 20
            Item 2.  Changes in Securities                                             20
            Item 3.  Defaults upon Senior Securities                                   20
            Item 4.  Submission of Matters to a Vote of Security Holders               20
            Item 5.  Other Information                                                 20
            Item 6.  Exhibits and Reports on Form 8-K                                  21
Signatures                                                                             22
</TABLE>


         SPECIAL CAUTIONARY NOTICE REGARDING FORWARD-LOOKING STATEMENTS

         This report contains certain statements which are "forward-looking"
statements under the federal securities laws that are based on the beliefs of
management as well as assumptions made by and information currently available to
management. Forward-looking statements appear throughout Note 9 of the "Notes to
Condensed Consolidated Financial Statements" entitled "Subsequent Events"
regarding the Company's proposed acquisition by the Company's Senior Management
and a wholly-owned subsidiary of Leonard Green & Partners, L.P. Certain factors
could cause actual results to differ materially from those in such forward
looking statements including, without limitation, (i) the failure to receive the
necessary stockholder approval or, if required, anti-trust clearance or effect
the successful tender offer for at least a majority of the Company's 10.5%
senior notes due 2007 in a timely manner, or at all, and (ii) the failure to
satisfy various closing conditions set forth in the definitive Agreement and
Plan of Merger. Forward looking statements also appear throughout Item 2 of Part
I, "Management's Discussion and Analysis of Financial Condition and Results of
Operations" concerning the Company's seasonal patterns of working capital and
revenue and operating results in

                                       2
<PAGE>

its business. Certain factors could cause actual results to differ materially
from those in such forward-looking statements including, without limitation, (i)
continuation of historical seasonal patterns of demand for the Company's
products and the Company's ability to meet the demand; (ii) actions by
competitors, including without limitation new product introductions; (iii) the
loss of domestic or foreign suppliers; (iv) changes in business strategy or new
product lines and the Company's ability to successfully implement these; (v)
moderation of uniform and accessories revenue growth; and (vi) changes in
interest rates and general economic conditions. These "forward-looking
statements" are based on currently available information and plans. They are
inherently uncertain, and investors must recognize that events could turn out to
be significantly different from the Company's expectations.









                                       3
<PAGE>

Part I. FINANCIAL INFORMATION; Item 1                       FINANCIAL STATEMENTS

                      VARSITY BRANDS, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                   (UNAUDITED)
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                     March 31,    December 31,     March 31,
                                                                       2003          2002           2002
                                                                    ---------      ---------      ---------
<S>                                                                 <C>            <C>            <C>
ASSETS
Current assets:
   Cash and cash equivalents                                        $  10,983      $  18,821      $   7,386
   Accounts receivable, trade less allowance for doubtful
      accounts ($456, $441 and $295, respectively)                      7,655         12,062          6,243
   Inventories                                                         12,398          7,811         12,457
   Prepaid expenses                                                     5,104          4,337          4,997
   Other receivables                                                      352            259          3,212
   Deferred taxes                                                       4,470          2,770          2,793
                                                                    ---------      ---------      ---------
Total current assets                                                   40,962         46,060         37,088

Property, plant and equipment, less accumulated
   depreciation ($5,489, $5,081 and $5,382, respectively)               3,635          3,459          4,116
Deferred taxes                                                            660            660             --
Goodwill, less accumulated amortization of $9,595                      66,596         66,596         66,596
Intangibles and deferred charges, less accumulated
   amortization ($3,741, $3,545 and $3,224, respectively)               2,164          2,186          2,620
Other assets                                                              584            597            561
                                                                    ---------      ---------      ---------
                                                                    $ 114,601      $ 119,558      $ 110,981
                                                                    =========      =========      =========

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
   Accounts payable                                                 $   9,591      $   5,225      $   9,363
   Accrued liabililties                                                 4,387          7,068          5,189
   Customer deposits                                                    3,324          7,318          2,946
   Current portion of long-term debt                                    2,375          2,375          1,375
                                                                    ---------      ---------      ---------
Total current liabilities                                              19,677         21,986         18,873

Long-term debt                                                         69,785         69,785         80,410
Deferred taxes                                                             --             --            188
Contingent liabilities                                                     --             --             --

Stockholders' equity:
   Preferred stock                                                         --             --             --
   Common stock                                                            96             96             95
   Additional paid-in capital                                          37,788         37,788         37,306
   Accumulated deficit                                                (12,745)       (10,097)       (25,891)
                                                                    ---------      ---------      ---------
                                                                       25,139         27,787         11,510
                                                                    ---------      ---------      ---------
                                                                    $ 114,601      $ 119,558      $ 110,981
                                                                    =========      =========      =========
</TABLE>

            See notes to condensed consolidated financial statements.


                                       4
<PAGE>

                      VARSITY BRANDS, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)
                  (IN THOUSANDS, EXCEPT FOR PER SHARE AMOUNTS)


                                                      THREE MONTHS ENDED
                                                           MARCH 31,
                                                    2003              2002
                                                  --------          --------
Net revenues:
   Uniforms and accessories                       $  6,401          $  5,654
   Camps and events                                 17,287            13,039
                                                  --------          --------

                                                    23,688            18,693

Cost of revenues:
   Uniforms and accessories                          4,060             4,066
   Camps and events                                 10,433             8,063
                                                  --------          --------

Cost of revenues                                    14,493            12,129
                                                  --------          --------

Gross profit                                         9,195             6,564

Selling, general and
   administrative expenses                          11,631            10,715
                                                  --------          --------

Loss from operations                                (2,436)           (4,151)

Other expense
   Interest expense, net                             1,912             2,126
                                                  --------          --------

Total other expense                                  1,912             2,126
                                                  --------          --------

Operating loss before income taxes (benefit)        (4,348)           (6,277)

Incomes taxes (benefit)                             (1,700)             (410)
                                                  --------          --------

Net loss                                          $ (2,648)         $ (5,867)
                                                  ========          ========

Loss per share:
         Basic and diluted                        $  (0.28)         $  (0.62)

Weighted average number common and
   common equivalent shares outstanding:
         Basic and diluted                           9,592             9,452



            See notes to condensed consolidated financial statements.


                                       5
<PAGE>


                      VARSITY BRANDS, INC. AND SUBSIDIARIES
            CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                                   (UNAUDITED)
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                                                Retained
                                                                              Additional        Earnings           Total
                                                        Common Stock            paid-in       (Accumulated      Stockholders'
                                                   Shares        Amount         Capital          deficit)          Equity
                                                   -----        --------        --------         --------         --------
<S>              <C>                               <C>          <C>             <C>              <C>              <C>
FOR THE THREE MONTHS ENDED MARCH 31, 2002
Balance, January 1, 2002                           9,452        $     95        $ 37,306         $(20,024)        $ 17,377
   Net loss for the period                            --              --              --           (5,867)          (5,867)
                                                   -----        --------        --------         --------         --------
                                                   9,452        $     95        $ 37,306         $(25,891)        $ 11,510
                                                   =====        ========        ========         ========         ========

FOR THE THREE MONTHS ENDED MARCH 31, 2003
Balance, January 1, 2003                           9,592        $     96        $ 37,788         $(10,097)        $ 27,787
   Net loss for the period                            --              --              --           (2,648)          (2,648)
                                                   -----        --------        --------         --------         --------
                                                   9,592        $     96        $ 37,788         $(12,745)        $ 25,139
                                                   =====        ========        ========         ========         ========
</TABLE>



            See notes to condensed consolidated financial statements.


                                       6
<PAGE>

                      VARSITY BRANDS, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)


                                                           THREE MONTHS ENDED
                                                               MARCH 31,
                                                           2003          2002
                                                        --------      --------
Cash flows from operating activities:
   Net loss                                             $ (2,648)     $ (5,867)
   Adjustments to reconcile net loss to net
     cash used in operations:
      Depreciation and amortization:
         Amortization of debt issue costs                    129           161
         Other depreciation and amortization                 475           468
      Provision for losses on accounts receivable             75            42
      Deferred taxes                                      (1,700)         (410)
      Changes in assets and liabilities:
         (Increase) decrease in:
            Accounts receivable, trade                     4,332         6,165
            Inventories                                   (4,587)       (4,594)
            Prepaid expenses                                (767)       (1,060)
            Other receivables                                (93)          454
            Other assets                                      13            (2)
         Increase (decrease) in:
            Accounts payable                               4,366         3,472
            Accrued liabilities                           (2,681)       (3,278)
            Customer deposits                             (3,994)       (2,377)
                                                        --------      --------

Net cash used in operations                               (7,080)       (6,826)

Cash flows from investing activities:
   Capital expenditures                                     (584)         (182)
   Deferred organization costs                              (174)           --
                                                        --------      --------

Net cash used in investing activities                       (758)         (182)

Cash flows from financing activities:
   Debt issue costs                                           --            (3)
                                                        --------      --------

Net cash used by financing activities                         --            (3)
                                                        --------      --------

Net decrease in cash                                      (7,838)       (7,011)
Cash, beginning                                           18,821        14,397
                                                        --------      --------
Cash, ending                                            $ 10,983      $  7,386
                                                        ========      ========


                 See notes to consolidated financial statements.


                                       7
<PAGE>


                      VARSITY BRANDS, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1.   BASIS OF PRESENTATION

     The condensed consolidated financial statements represent Varsity Brands,
Inc. ("Varsity" or the "Company") and its wholly-owned subsidiaries. All
significant intercompany accounts and transactions have been eliminated. These
statements are unaudited, and in the opinion of management include all
adjustments (consisting only of normal recurring adjustments) necessary for fair
presentation of the Company's condensed consolidated financial position and the
condensed consolidated results of its operations and cash flows at March 31,
2003 and 2002 and for the periods then ended. Certain information and footnote
disclosures made in the Company's last Annual Report on Form 10-K have been
condensed or omitted for these interim statements. Accordingly, these condensed
consolidated financial statements should be read in conjunction with the
Company's Annual Report on Form 10-K for the year ended December 31, 2002.
Operating results for the three months ended March 31, 2003 are not necessarily
indicative of the results to be expected during the remainder of 2003.

2.   EARNINGS PER SHARE

     Net loss per share amounts have been computed by dividing the net loss by
the weighted average number of outstanding common shares. Diluted earnings per
share for the three months ended March 31, 2003 and 2002 is equal to basic
earnings per share since potentially dilutive securities, which include
convertible debt and Common Stock options, were not dilutive due to the net
losses incurred.

3.   RECEIVABLES

     Accounts receivable include unbilled shipments of approximately $1,261,000,
$639,000 and $966,000 at March 31, 2003, December 31, 2002 and March 31, 2002,
respectively. It is the Company's policy to record revenues when the related
goods have been shipped. Unbilled shipments represent receivables for shipments
that have not yet been invoiced. These amounts relate principally to partial
shipments to customers who are not invoiced until their order is shipped in its
entirety or customers with orders containing other terms that require a deferral
in the issuance of the invoice. Management believes that substantially all of
these unbilled receivables will be invoiced within the current sales season.


                                       8
<PAGE>

4.   INVENTORIES

        Inventories consist of the following:
        (In thousands)                     March 31,    December 31,   March 31,
                                             2003           2002          2002
                                           -------------------------------------
        Finished goods                      $9,210         $5,012         $9,220
        Raw materials                        3,188          2,799          3,237
                                           -------------------------------------
                                           $12,398         $7,811        $12,457
                                           =====================================

5.   SUPPLEMENTAL CASH FLOW INFORMATION

     Cash paid for interest was $3,491,000 and $3,921,000 for the three-month
periods ended March 31, 2003 and 2002, respectively.

6.   INCOME TAXES

     Operating results from continuing operations for the three-month periods
ended March 31, 2003 and 2002 reflect a tax benefit based on the anticipated
effective annual tax rate for that year. The 2003 anticipated effective tax rate
is estimated based upon anticipated income and non-deductible expenses for the
year. The 2002 anticipated effective annual tax rate is estimated based on
remaining net operating loss carryforwards and anticipated income and
non-deductible expenses for the year. The actual tax rate for the year could
vary substantially from the anticipated rate due to the use of these estimates.

7.   SEGMENT INFORMATION

     Net revenues and income or loss from operations for the Company's two
reportable segments are as follows:

                                                          THREE MONTHS ENDED
                                                              MARCH 31,
                                                      -------------------------
                                                         2003          2002
                                                      -------------------------
                                                            (In thousands)
         Net revenues:

            Uniforms and accessories                  $   6,401     $  5,654
            Camps and events                             17,287       13,039
                                                      -----------   ----------
               Consolidated total                     $  23,688     $ 18,693
                                                      ===========   ==========

         Income (loss) from operations:

            Uniforms and accessories                  $  (3,852)    $ (4,332)
            Camps and events                              1,900          696
            Corporate and unallocated expenses             (484)        (515)
                                                      -----------   ----------
               Consolidated total                     $  (2,436)    $ (4,151)
                                                      ===========   ==========


                                       9
<PAGE>

     8.   ACCOUNTING PRONOUNCEMENTS

         The Financial Accounting Standards Board has issued SFAS No. 143,
"Accounting for Asset Retirement Obligations." SFAS No. 143 became effective
January 1, 2003. The new rules apply to all entities that have legal obligations
associated with the retirement of a tangible long-lived asset. The entity should
recognize a liability for an asset retirement obligation if (a) the entity has a
duty or responsibility to settle an asset retirement obligation, (b) the entity
has little or no discretion to avoid the future transfer or use of the assets,
and (c) the transaction or other event obligating the entity has occurred. The
Company does not believe this pronouncement will have a material impact on its
financial statements.

         In April 2002, the Financial Accounting Standards Board issued SFAS No.
145, "Recission of FASB Statements 4, 44 and 64, Amendment of FASB Statement 13,
and Technical Corrections" ("SFAS No. 145"). Among other provisions, SFAS No.
145 rescinds FASB Statement 4 "Reporting Gains and Losses from Extinguishment of
Debt." Accordingly, gains or losses from extinguishment of debt should not be
reported as extraordinary items unless the extinguishment qualifies as an
extraordinary item under the criteria of Accounting Principles Board Opinion 30,
"Reporting the Results of Operations - Reporting the Effects of Disposal of a
Segment of a Business, and Extraordinary, Unusual and Infrequently Occurring
Events and Transactions ("APB 30"). Gains and losses from extinguishment of
debt, which do not meet the criteria of APB 30, should be reclassified to income
from continuing operations in all prior periods presented. The provisions of
SFAS No. 145 will be effective for fiscal years beginning after May 15, 2002.
Upon adoption, the Company anticipates that it will reclassify gains on early
extinguishment of debt and related taxes previously recorded as extraordinary
items to other income and provision for taxes, respectively.

         On June 1, 2002, the Financial Accounting Standards Board issued SFAS
No. 146, "Accounting for Costs Associated with Exit or Disposal Activities."
SFAS No. 146 addresses the accounting and reporting for costs associated with
exit or disposal activities. This Statement requires that a liability for a cost
associated with an exit or disposal activity be recognized and measured
initially at fair value only when the liability is incurred. This pronouncement
became effective as of January 1, 2003 and will impact any exit or disposal
activities the Company initiates after that date.

                                       10
<PAGE>

         In December 2002, the Financial Accounting Standards Board issued SFAS
No. 148, "Accounting for Stock-Based Compensation - Transition and Disclosure:
an amendment of FASB Statement 123" ("SFAS No. 148"). SFAS No. 148 provides
alternative transition methods for a voluntary change in the fair value based
method of accounting for stock-based employee compensation. In addition, SFAS
No. 148 amends the disclosure requirements of SFAS No. 123 to require prominent
disclosures in annual financial statements about the method of accounting for
stock-based employee compensation and the pro forma effect on reported results
of applying the fair value based method for entities that use the intrinsic
value method of accounting. The pro forma effect disclosures are also required
to be prominently disclosed in the interim period financial statements. These
provisons of SFAS No. 148 become effective for financial statements for fiscal
years ending after December 15, 2002 and are effective for financial reports
containing condensed financial statements for interim periods beginning after
December 15, 2002.

         In January 2003, the Financial Accounting Standards Board issued FIN
46, "Consolidation of Variable Interest Entities - An Interpretation of ARB 51"
("FIN 46"). FIN 46 is effective immediately for any variable interest entity
created after January 31, 2003 and to variable interest entities that an
enterprise acquires an interest in after that date. The statement includes
disclosure requirements that must be met and may require the reporting entity to
consolidate those variable interest entities which meet certain requirements.
This pronouncement will become effective as of the first interim or fiscal
period beginning after June 15, 2003 and will impact any variable interest
entity activities the Company inititates after that date.

         In June 2001, the Financial Accounting Standards Board (FASB) issued
SFAS No. 142, "Goodwill and Other Intangible Assets." SFAS No. 142 was effective
January 1, 2002. Under the new rules, goodwill and indefinite lived intangible
assets will no longer be amortized, but will be reviewed annually for
impairment. Intangible assets that are not deemed to have an indefinite life
will continue to be amortized over their useful lives.

     9.    SUBSEQUENT EVENTS

         On April 21, 2003, the Company entered into a definitive Agreement and
Plan of Merger whereby the Company will be acquired by the Company's Senior
Management and a wholly-owned subsidiary of an affiliate of Leonard Green &
Partners, L.P., a private merchant banking firm. Under the terms of the
agreement, all of the Company shareholders will receive $6.57 per share in cash
upon the closing of the transaction, other than those members of Senior
Management who will exchange a portion of their equity holdings in the Company
for equity in the surviving corporation. The balance of Senior Management's
equity holdings in the Company will be acquired or cancelled for the same
consideration that all of the Company's other stockholders are receiving for
their equity interest in the Company. The aggegate value of the merger
transaction is approximately $130.9 million, including the repayment of
indebtedness.

                                       11
<PAGE>

         The closing of this transaction is subject to certain terms and
conditions customary for transactions of this type, including but not limited to
approval by the Company's stockholders. Mr. Jeffrey G. Webb, the Company's chief
executive officer (who will be the chief executive officer of the surviving
corporation after the closing of the transaction), along with certain other
members of the Company's current and former management, and certain members of
the Company's Board of Directors, who collectively own approximately 47% of the
outstanding shares of the Company's common stock, have agreed to vote their
shares in favor of the transaction. The closing of the transaction may also be
subject to anti-trust clearance and will be subject to the successful completion
of a tender offer for at least a majority of the Company's outstanding 10.5%
senior notes due 2007. The closing is not subject to financing.

         Approval of the Company's stockholders will be solicited by the Company
by means of a proxy statement that will be mailed to stockholders upon
completion of the requisite Securities and Exchange Commission filing and review
process. Simultaneously, the Company will make a tender offer for the Company's
outstanding 10.5% senior notes which will be conditioned upon, and effected
simultaneously with, the closing of the merger transaction. The Company
currently anticipates closing the transaction in the third quarter of this year.

         Upon completion of the merger, the Company will become a private
entity, however, there are no assurances that the Company will be able to
complete the merger as currently contemplated for various reasons, including but
not limited to, the failure to receive the necessary stockholder approval and,
if required, anti-trust clearance, the failure to effect a successful tender
offer for at least a majority of the Company's 10.5% senior notes due 2007 in a
timely manner, or at all, or the failure to satisfy various closing conditions
set forth in the definitive Agreement and Plan of Merger.

     10.    RECLASSIFICATION OF PRIOR PERIODS

       Certain prior period balances have been reclassified to conform to
current year presentation.


                                       12
<PAGE>

         ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

         RESULTS OF OPERATIONS

         Overview and seasonality

         Operations for the three-month period ended March 31, 2003 resulted in
a net loss of $2.6 million, or $0.28 per share, as compared to a net loss of
$5.9 million, or $0.62 per share, for the first quarter of 2002.

         The loss from operations for the first quarter of 2003 decreased by
$1.8 million, or 41.3%, to $2.4 million from $4.2 million in the first quarter
of 2002. The Company benefited from increases in revenues and gross margins
combined with decreases in selling, general and administrative expenses as a
percentage of sales, as described in more detail in the discussion which follows
this overview.

         The loss in the first quarter of 2003 was anticipated and is consistent
with the seasonality of the Company's business. In recent years, the Company's
operations have been profitable in the second and third quarters, with the third
quarter typically the strongest, while losses have typically been incurred in
the first and fourth quarters. The factors influencing this seasonal pattern
were discussed in the Company's last Annual Report on Form 10-K.

         Revenues

         Revenues for the three-month period ended March 31, 2003 increased by
$5.0 million, or 26.7%, to $23.7 million from $18.7 million in the first quarter
of 2002.

         Revenues from the sale of uniforms and accessories increased by $0.7
million, or 13.2%, to $6.4 million in the first quarter of 2003 from $5.7
million for the first quarter of 2002. This increase was attributable to an
overall strong increase in product sales at the Company's national championships
combined with increased sales of dance and recital wear to the studio dance
market. These increases were offset by slight decreases in sales of the
Company's other uniform and accessories lines. The increase in special event
product sales is directly attributable to an increase in the number of
participants at these events. The increase in studio dance and recital sales is
attributable to increased market penetration of the Company's studio dance line.
The Company is currently in its second year of offering dance and recital
apparel to the studio dance market.

         Revenues from camps and events increased by $4.3 million, or 32.6%, to
$17.3 million in the first quarter of 2003 from $13.0 million in the first
quarter of 2002. The increase in revenues for the three-month period is directly
attributable to an increase in the number of participants at the Company's
regional and national cheerleading and dance team championships and at the
Company's studio dance competitions and conventions, as compared to the prior
year.

                                       13
<PAGE>

  Gross Profit

         Gross profit for the first quarter of 2003 increased by 40.1% to $9.2
million from $6.6 million in the first quarter of 2002. Gross margin rates
increased by 3.7 percentage points to 38.8% in the first quarter of 2003 from
35.1% in the first quarter of 2002.

         Gross margin rates for the uniforms and accessories segment increased
to 36.6% in the first quarter of 2003 from 28.1% in the first quarter of 2002.
These increases are a result of higher margins earned on the special event
merchandise and studio dance apparel as compared to our other uniform lines.

         Gross margin rates for the camps and events segment increased to 39.6%
in the first quarter of 2003 from 38.2% in the first quarter of 2002. The
increase is primarily due to a increase in the national championship attendance
combined with the effects of spreading certain fixed production costs over a
larger revenue base.

  Selling, general and administrative

         Selling, general and administrative expenses decreased as a percentage
of revenues to 49.1% in the first quarter of 2003 from 57.3% in the first
quarter of 2002. The improvement is principally due to economies of scale
realized by spreading fixed and certain variable administrative expenses over a
greater revenue base.

         Selling, general and administrative expenses as a percentage of
revenues with respect to the uniforms and accessories segment decreased to 97%
in the first quarter of 2003 from 101% in the first quarter of 2002. The high
level of selling, general and administrative costs as a percentage of uniforms
and accessories revenue is expected during the first quarter due to the
seasonality of the segment's operations combined with the recognition of
expenses, during the first quarter, associated with producing and mailing the
Company's catalogs and hosting the annual national sales meeting. These gains
were due to improved economies of scale.

         Selling, general and administrative expense ratios for the camps and
events segment improved to 28.7% in the first quarter of 2003 from 32.8% in the
first quarter of 2002. These gains are due to improved economies of scale.

  Interest Expense

         Interest expense decreased to $1.9 million in the first quarter of 2003
from $2.1 million in the first quarter of 2002. The decrease is due to the
reduced carrying amount of both the Company's 10.5% Senior Notes and the 4.1%
Subordinated Convertible Debt.

                                       14
<PAGE>

  Income Taxes

         Operating results from continuing operations for the three-month
periods ended March 31, 2003 and 2002 include an income tax benefit based on the
anticipated effective annual tax rate for that year. The 2003 anticipated
effective annual rate is estimated based on the expected income and
non-deductible expenses for the year. The 2002 anticipated effective annual tax
rate is estimated based on the expected utilization of remaining net operating
loss carryforwards and anticipated income and non-deductible expenses for the
year. The actual tax rate for the year could vary substantially from the
anticipated rate due to the use of these estimates.

  Liquidity and Capital Resources

         The seasonality of the Company's working capital needs is impacted by
three key factors. First, a significant portion of the products the Company
sells are shipped during the late spring, summer and early fall period on
dated-payment terms, with the related receivables becoming due when the school
year begins during the following July to October period. Second, the Company
incurs costs related to the Company's summer camp business during the first and
second quarters as the Company prepares for the upcoming camp season, while camp
revenues are mostly collected in the June to August time period. Lastly, the
outstanding balance of the Company's publicly held debt impacts the Company's
working capital requirements as semi-annual interest payments on our currently
$66.0 million of 10.5% Senior Notes outstanding come due each January and July.

         To finance these seasonal working capital demands, the Company
maintains a credit facility in the form of a $15 million revolving line of
credit, less a $100,000 reserve established by the bank. The line of credit
agreement is available from January 15 - September 15. Historically, the
outstanding balance on the credit facility usually follows the seasonal cycles
described above, increasing during the early part of the operating cycle in the
first and second quarters of each year and then decreasing from the middle of
the third quarter and into the fourth quarter as collections are used to reduce
the outstanding balance. Such seasonality should continue in the future. The
credit facility agreement contains covenants which, among other things, require
the Company to meet certain financial ratio and net worth tests, restrict the
level of additional indebtedness that the Company may incur, limit payments of
dividends, restrict the sale of assets and limit investments that the Company
may make. The Company has pledged essentially all of its tangible assets as
collateral for the credit facility.

         At March 31, 2003 and 2002, there were no outstanding balances due
under the credit facility. The Company had approximately $716,000 of open letter
of credit agreements outstanding as of May 12, 2003.

                                       15
<PAGE>

         The 10.5% Senior Notes contain covenants that, among other things,
restrict the level of other indebtedness that the Company may incur, the amount
of investments it may make in other businesses, the sale of assets and use of
proceeds therefrom and the payments of dividends. The senior notes also restrict
payment of junior indebtedness prior to the maturity of the junior indebtedness.

         The Company's current debt service obligations are significant and,
accordingly, the Company's ability to meet its debt service and other
obligations will depend on the Company's future performance and is subject to
financial, economic and other factors, some of which are beyond the Company's
control. Furthermore, due to the seasonality of the Company's working capital
demands described above, year-over-year growth in the Company's business and
working capital requirements could lead to higher debt levels in future periods.
Management believes operating cash flow together with funds available from the
Company's credit facility will be sufficient to fund the Company's current debt
service, seasonal and other working capital requirements.

         Net cash used by operations increased from $6.8 million for the period
ended March 31, 2002 to $7.1 million for the period ended March 31, 2003. The
increase is primarily due to a change in the timing of the receipt of customer
deposits for the Company's regional and national championships and a reduction
in the receipt of customer accounts receivable payments.

         Net cash used in investing activities increased from $0.2 million in
the period ended March 31, 2002 to $0.8 million in the period ended March 31,
2003. This increase is due to an expected increase in capital expenditures in
2003 combined with the capitalization of certain merger related expenses.

Critical Accounting Policies

         ACCOUNTS RECEIVABLE: The majority of the Company's accounts receivables
arise from the sale of cheerleading and dance team uniforms and accessories to
high schools, junior high schools and all-star/youth groups throughout the
United States. Except as described in Note 3 to the condensed consolidated
financial statements, accounts receivable are due within 30 days and are stated
at amounts due from customers net of an allowance for doubtful accounts.
Accounts outstanding longer than the contractual payment terms are considered
past due. The Company determines its allowance by considering a number of
factors, including the length of time trade accounts receivable are past due and
the Company's previous loss history. The Company writes-off accounts receivable
when they become uncollectible, and payments subsequently received on such
receivables are credited to the allowance for doubtful accounts. The company
fully reserves all service charges assessed on past due accounts. Service charge
payments subsequently received are recognized as income at the time of payment.

         INVENTORIES: Inventories are stated at the lower of cost (determined on
a first-in, first-out basis) or market and include material, labor and factory
overhead, net of an allowance for discontinued inventory. The Company determines
its allowance based on a variety of factors, the

                                       16
<PAGE>

most important of which being the inclusion/exclusion of the inventory item from
the Company's current catalog. Items no longer included in the catalog are
reserved at 100% of cost.

         INTANGIBLE ASSETS, GOODWILL AND DEFERRED CHARGES: Debt issue costs are
amortized to interest expense over the term of the related debt. Other
intangibles and deferred charges are being amortized by the straight-line method
over their respective estimated lives.

         Goodwill and indefinite lived intangible assets are reviewed annually
for impairment. The impairment assessment is derived using discounted cash flow
analysis to calculate fair value. The Company will compare the calculated fair
value to the carrying value of goodwill. Any impairment charges will be charged
against operations at the time the impairment is determined.

         Effective January 1, 2002, the Company adopted the provisions of
Statement of Financial Accounting Standards No. 142, "Goodwill and Other
Intangible Assets" ("SFAS 142"). SFAS 142 provides that goodwill, as well as
identifiable intangible assets, should not be amortized. Accordingly, with the
adoption of SFAS 142, the Company discontinued the amortization of goodwill as
of January 1, 2002.

         REVENUES: Sales of products are recorded upon shipment to customers.
Camp and event revenues are recognized over the term of the respective activity.

Risk Factors

Restrictive Covenants and Asset Encumbrances

         The Company's debt instruments contain numerous restrictive covenants
that limit the discretion of the management of the Company with respect to
certain business matters. These covenants place significant restrictions on,
among other things, the ability of the Company to incur additional indebtedness,
to create liens or other encumbrances, to pay dividends or make other restricted
payments, to make investments, loans and guarantees and to sell or otherwise
dispose of a substantial portion of assets to, or merge or consolidate with,
another entity. The Company's debt instruments also contain a number of
financial covenants that require the Company to meet certain financial ratios
and tests and provide that a Change of Control (as defined therein) constitutes
an event of default. A failure to comply with the obligations contained therein,
if not cured or waived, could permit acceleration of the related indebtedness
and acceleration of indebtedness under other instruments that contain
cross-acceleration or cross-default provisions. In addition, the Company has
pledged substantially all of its assets to secure its senior bank debt, which is
a revolving line of credit. In the case of an event of default under the
Company's senior bank debt, the lenders thereunder would be entitled to exercise
the remedies available to a secured lender under applicable law. If the Company
were obligated to repay all or a significant portion of its indebtedness, there
can be no assurance that the Company would have sufficient cash to do so or that
the Company could successfully refinance such indebtedness. Other indebtedness
of the Company that may be incurred in the future may contain financial or other
covenants more restrictive than those applicable to the Company's existing debt
instruments.

                                       17
<PAGE>

Seasonality and Quarterly Fluctuations

         Varsity's business and results of operations are highly seasonal and
follow a similar annual pattern. With respect to Varsity's cheerleader and dance
team camps, such camps are held exclusively in the summer months. Sales of
Varsity's cheerleader, dance team and booster club uniforms and accessories
primarily occur prior to the beginning of the school year. Accordingly, a
substantial portion of Varsity's annual revenues and all of its net income is
generated in the second and third quarters of each calendar year, while the
first and fourth quarters have historically resulted in net losses. Varsity's
working capital needs have generally followed a similar pattern reaching their
peak at the end of the first calendar quarter and continuing through the second
quarter. This period follows Varsity's off-season period during which it
generates only nominal revenues while incurring expenditures in preparation for
its approaching peak season. Varsity has typically incurred seasonal borrowings
during this period which it has historically eliminated during the third quarter
as it receives prepayments on camp tuition and fees. See "Management's
Discussion and Analysis of Financial Condition and Results of Operations--
Overview and seasonality."

Uncertainty of Insurance Coverage; Personal Injury Claims

         Cheerleading is a vigorous athletic activity involving jumps, tumbling,
partner stunts and pyramids, with which there are associated risks of personal
injury. Varsity actively promotes safety among cheerleaders, dance team
participants and coaches and was a founding member of and is an active
participant in the American Association of Cheerleading Coaches and Advisors, an
industry trade group whose mission is to improve the quality of cheerleading and
to maintain established safety standards. From time to time, Varsity is subject
to personal injury claims arising from its cheerleader and dance team camps,
none of which was or is material to Varsity's operations. Varsity believes it is
adequately insured against such risks. There can be no assurances, however, that
one or more meritorious claims against Varsity for serious personal injury would
not have an adverse effect upon the Company's business, financial condition and
results of operations.

Risk of Loss of Material Contractual Relationships; Competition

         Varsity organizes and produces various national cheerleading and dance
team championships for exclusive broadcast on the ESPN, Inc. ("ESPN") cable
channel. Varsity's current agreement with ESPN expires in October of 2003.
Varsity has entered into several agreements with Walt Disney Attractions, Inc.
("Walt Disney Attractions") pursuant to which its national cheerleading and
dance team championships through 2004 will be held at the Walt Disney World
Resort in Florida. While the Company believes that it will be successful in
renewing or replacing the agreements with ESPN and Walt Disney Attractions in a
manner which will continue to promote the Company's products and services, there
can be no assurances that it will be successful in doing so or that it will be
able to do so on economically favorable terms. Although the Company believes
that the failure to renew any one of the agreements with ESPN and Walt Disney
Attractions would not have a material effect on the Company, there can be no
assurances that the loss of all or any combination of such agreements would not
have a material adverse effect on the Company's business, financial condition
and results of operations.

                                       18
<PAGE>

         Varsity is one of two major national companies that designs and markets
cheerleader, dance team and booster club uniforms and accessories and is one of
two major national operators of camps. While Varsity's only national competitor
is National Spirit Group Limited, it also competes with other smaller national
and regional competitors that serve the uniform and accessories market or that
operate cheerleader and dance team camps and clinics.

Regulation

         At present, no national governing body regulates cheerleading and dance
team activities at the collegiate level. Although voluntary guidelines relating
to safety and sportsmanship have been issued by the NCAA and some of the
athletic conferences, to date cheerleading and dance teams generally are free
from rules and restrictions similar to those imposed on other competitive
athletics at the college level. However, if rules limiting off-season training
are applied to cheerleading and/or dance teams (similar to rules imposed by the
NCAA on other sports) and the Company is unable to work with the NCAA and its
member institutions, or any other applicable regulatory body, to designate
acceptable times and sites regarding when and where camps with respect to
cheerleading and/or dance teams can be conducted, Varsity might not be able to
offer a significant number of its camps either because participants might be
prohibited from participating during the summer or because suitable sites might
not be available. Although the Company is not aware of any school officially
adopting these activities as a competitive sport, recognition of cheerleading
and/or dance teams as "sports" would increase the possibility that these
activities may become regulated. If Varsity were restricted from providing its
training programs to colleges and high schools, or if cheerleaders and dance
teams were restricted from training during the off-season, such regulations
would likely have a material adverse affect on Varsity's business, financial
condition and results of operations. However, the Company currently does not
believe that any regulation of collegiate cheerleading or dance teams as a
"sport" is forthcoming in the foreseeable future, and in the event any rules are
proposed to be adopted by athletic associations, the Company expects to
participate in the formulation of such rules to the extent permissible.

         At the high school level, some state athletic associations have
classified cheerleading as a sport and have in some cases imposed certain
restrictions on off-season practices and out-of-state travel to competitions.
However, in all cases to date, Varsity has been able to work with these state
athletic associations to designate acceptable times for the cheerleaders within
these states to attend camps. Accordingly, at the present time, state
regulations have not had a material adverse effect on Varsity's ability to
conduct its normal business activities within those states. Varsity has also
signed agreements with several state associations to assist with sponsoring and
execution of official competitions with these states.

Dependence on Key Personnel

         The Company's executive officers and certain other key employees of
Varsity have been primarily responsible for the development and expansion of
their respective business, and the loss of the services of one or more of these
individuals could have a material adverse effect on the Company. The Company has
employment and non-competition agreements with certain key personnel, although
it currently does not have an employment agreement or a non-competition


                                       19
<PAGE>

agreement with Jeffrey G. Webb, the Company's founder, President and Chief
Executive Officer.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

         Varsity is exposed to some market risk from changes in foreign currency
rates, in connection with the Company's sale of travel packages for trips
outside of the United States, however, such risk has never been, and the Company
does not believe that it currently is, material to its business operations.

ITEM 4.  CONTROLS AND PROCEDURES

         Within the 90-day period prior to the filing of this Quarterly Report
on Form 10-Q, the Company carried out an evaluation, under the supervision and
with the participation of management, including the Chief Executive Officer and
the Chief Financial Officer, of the effectiveness of the Company's disclosure
controls and procedures. Based upon the evaluation, the Company's Chief
Executive Officer and Chief Financial Officer have concluded that the Company's
disclosure controls and procedures are effective to timely alert them to
material information required to be included in the Company's Exchange Act
filings. In addition, there have been no changes in internal controls, or in
other factors that could significantly affect internal controls subsequent to
the date the Chief Executive Officer and Chief Financial Officer completed their
evaluation.


Part II OTHER INFORMATION

Item 1.  Legal Proceedings

         The Company from time to time becomes involved in various claims and
lawsuits incidental to its business. None of these matters are expected to have
a material adverse effect on the Company's consolidated financial statements.

Item 2.  Changes in Securities

                None

Item 3.Defaults upon Senior Securities

                None

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

                None

Item 5.Other Information

                None

                                       20
<PAGE>

Item 6.  Exhibits and Reports on Form 8-K

         (a) Exhibits:

                (2) PLAN OF ACQUISITION, REORGANIZATION, ARRANGEMENT LIQUIDATION
OR SUCCESSION

                        2.1  Agreement and Plan of Merger by and among Varsity
                             Brands, Inc., and VBR Holding Corporation and VB
                             Merger Corporation, dated as of April 21, 2003,
                             incorporated herein by reference to Exhibit 2.1 of
                             the Cmpany's Current Report on Form 8-K dated April
                             23, 2003 and filed with the Securities and Exchange
                             Commission on April 22, 2003

                        2.2  Form of Voting Agreement by and between certain
                             stockholders of Varsity Brands, Inc. and VBR
                             Holding Corporation, dated as of April 21, 2003,
                             incorporated herein by reference to Exhibit 2.2 of
                             the Company's Current Report on Form 8-K dated
                             April 21, 2003 and filed with the Securities and
                             Exchange Commission on April 22, 2003

                (99) OTHER INFORMATION

                        99.1 Certification of Jeffrey G. Webb Pursuant to 18
                             U.S.C. Section 1350, as Adpoted Pursuant to Section
                             906 of the Sarbanes-Oxley Act of 2002

                        99.2 Certification of John M. Nichols Pursuant to 18
                             U.S.C Section 1350, as Adopted Pursuant to Section
                             906 of the Sarbanes-Oxley Act of 2002

         (b) Reports on Form 8-K:

             A Current Report on Form 8-K dated April 21, 2003 was filed with
             the Securities and Exchange Commission on April 22, 2003 reporting
             the Company's entering into a definitive Agreement and Plan of
             Merger by and among Varsity Brands, Inc. VBR Holding Corporation
             and VB Merger Corporation.


                                       21
<PAGE>

SIGNATURES

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


                                           VARSITY BRANDS, INC.


Date:    May 15, 2003                 By:  /s/ Jeffrey G. Webb
                                                  President and
                                                  Chief Executive Officer


Date:    May 15, 2003                 By:  /s/ John M. Nichols
                                                  Chief Financial Officer and
                                                  Principal Accounting Officer





                                       22
<PAGE>

                      CERTIFICATION PURSUANT TO SECTION 302
                        OF THE SARBANES-OXLEY ACT OF 2002

I, Jeffrey G. Webb, certify that:

     1.  I have reviewed this quarterly report on Form 10-Q of Varsity Brands,
         Inc.;

     2.  Based on my knowledge, this quarterly report does not contain any
         untrue statement of a material fact or omit to state a material fact
         necessary to make the statements made, in light of the circumstances
         under which such statements were made, not misleading with respect to
         the period covered by this quarterly report;

     3.  Based on my knowledge, the financial statements, and other financial
         information included in this quarterly report, fairly present in all
         material respects the financial condition, results of operations and
         cash flows of the registrant as of, and for, the periods presented in
         the quarterly report;

     4.  The registrants's other certifying officers and I are responsible for
         establishing and maintaining disclosure controls and procedures (as
         defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and
         we have:

            (a)  designed such disclosure controls and procedures to ensure that
                 material information relating to the registrant, including its
                 consolidated subsidiaries, is made known to us by others within
                 those entities, particularly during the period in which this
                 quarterly report is being prepared;

            (b)  evaluated the effectiveness of the registrant's disclosure
                 controls and procedures as of a date within 90 days prior to
                 the filing date of this quarterly report (the "Evaluation
                 Date"); and

            (c)  presented in this quarterly report our conclusions about the
                 effectiveness of the disclosure controls and procedures based
                 on our evaluation as of the Evaluation Date;

     5.  The registrant's other certifying officers and I have disclosed, based
         on our most recent evaluation, to the registrant's auditors and the
         audit committee of registrant's board of directors (or persons
         performing the equivalent function):

            (a)  all significant deficiencies in the design or operation of
                 internal controls which could adversely affect the registrant's
                 ability to record, process, summarize and report financial data
                 and have identified for the registrant's auditors any material
                 weaknesses in internal controls; and


                                       23
<PAGE>

            (b)  any fraud, whether or not material, that involves management or
                 other employees who have a significant role in the registrant's
                 internal controls; and

     6.  The registrant's other certifying officers and I have indicated in this
         quarterly report whether or not there were significant changes in
         internal controls or in other factors that could significantly affect
         internal controls subsequent to the date of our most recent evaluation,
         including any corrective actions with regard to significant
         deficiencies and material weaknesses.


Dated:   May 15, 2003                             /s/ JEFFREY G. WEBB
                                                  -------------------
                                                  Jeffrey G. Webb
                                                  President and
                                                  Chief Executive Officer







                                       24
<PAGE>

                      CERTIFICATION PURSUANT TO SECTION 302
                        OF THE SARBANES-OXLEY ACT OF 2002

I, John M. Nichols, certify that:

     1.  I have reviewed this quarterly report on Form 10-Q of Varsity Brands,
         Inc.;

     2.  Based on my knowledge, this quarterly report does not contain any
         untrue statement of a material fact or omit to state a material fact
         necessary to make the statements made, in light of the circumstances
         under which such statements were made, not misleading with respect to
         the period covered by this quarterly report;

     3.  Based on my knowledge, the financial statements, and other financial
         information included in this quarterly report, fairly present in all
         material respects the financial condition, results of operations and
         cash flows of the registrant as of, and for, the periods presented in
         the quarterly report;

     4.  The registrants's other certifying officers and I are responsible for
         establishing and maintaining disclosure controls and procedures (as
         defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and
         we have:

            (a)  designed such disclosure controls and procedures to ensure that
                 material information relating to the registrant, including its
                 consolidated subsidiaries, is made known to us by others within
                 those entities, particularly during the period in which this
                 quarterly report is being prepared;

            (b)  evaluated the effectiveness of the registrant's disclosure
                 controls and procedures as of a date within 90 days prior to
                 the filing date of this quarterly report (the "Evaluation
                 Date"); and

            (c)  presented in this quarterly report our conclusions about the
                 effectiveness of the disclosure controls and procedures based
                 on our evaluation as of the Evaluation Date;

     5.  The registrant's other certifying officers and I have disclosed, based
         on our most recent evaluation, to the registrant's auditors and the
         audit committee of registrant's board of directors (or persons
         performing the equivalent function):

            (d)  all significant deficiencies in the design or operation of
                 internal controls which could adversely affect the registrant's
                 ability to record, process, summarize and report financial data
                 and have identified for the registrant's auditors any material
                 weaknesses in internal controls; and

                                       25
<PAGE>

            (e)  any fraud, whether or not material, that involves management or
                 other employees who have a significant role in the registrant's
                 internal controls; and

     6.  The registrant's other certifying officers and I have indicated in this
         quarterly report whether or not there were significant changes in
         internal controls or in other factors that could significantly affect
         internal controls subsequent to the date of our most recent evaluation,
         including any corrective actions with regard to significant
         deficiencies and material weaknesses.



Dated: May 15, 2003                              /s/ JOHN M. NICHOLS
                                                 -------------------
                                                 John M. Nichols
                                                 Senior Vice President and
                                                 Chief Financial Officer



                                       26