United States 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 quarterly period ended March 31, 1999.



               Commission file number         0-19352
                                      -----------------------



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

                   Nevada                                 85-0325742
       (State or other jurisdiction of                (I.R.S. Employer
       incorporation or organization)                 Identification No.)


                120 Corporate Park Drive, Henderson, Nevada 89014
                    (Address of principal executive offices)

                                 (702) 566-2440
              (Registrant's telephone number, including area code)



Indicate by check mark whether the issuer (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    .
                                        ---    ---

As of May 11, 1999, the registrant  had 42,094,781  shares of Common Stock,  par
value $.001 per share, issued and outstanding.
<PAGE>

                         PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

 
                       AGRIBIOTECH, INC. AND SUBSIDIARIES

                           Consolidated Balance Sheets

                                   (Unaudited)
<TABLE>
<CAPTION>
                                     ASSETS


                                                     March 31,        June 30,
                                                       1999             1998
                                                   ------------     ------------
<S>                                                <C>              <C>
Current assets:
  Cash and cash equivalents                        $  5,454,285        2,700,846
  Accounts receivable, less allowance
   for doubtful accounts of $3,373,214
   at March 31, 1999 and $2,177,442 at
   June 30, 1998                                     81,189,135       39,503,262
  Inventories                                       100,126,259       58,609,554
  Deferred income taxes                               1,696,230        1,339,709
  Other                                               2,880,013        1,673,903
                                                   ------------     ------------
    Total current assets                            191,345,922      103,827,274

Property, plant and equipment, net                   65,742,761       47,964,522

Intangible assets, net of accumulated
 amortization                                       157,407,247      109,882,815

Investment in associated entity                       1,187,806          818,182

Other assets                                          6,434,009        2,038,115
                                                   ------------     ------------
    Total assets                                   $422,117,745      264,530,908
                                                   ============     ============
</TABLE>
See accompanying notes to consolidated financial statements.

                                       2
<PAGE>

                       AGRIBIOTECH, INC. AND SUBSIDIARIES

                           Consolidated Balance Sheets

                                   (Unaudited)
<TABLE>
<CAPTION>
                      LIABILITIES AND STOCKHOLDERS' EQUITY


                                                   March 31,         June 30,
                                                     1999              1998
                                                 ------------     -------------
<S>                                              <C>              <C>
Current liabilities:
  Short-term debt                                $  98,253,230       50,329,614
  Current installments of long-term
   obligations                                       2,437,195        3,251,846
  Accounts payable                                  47,095,625       13,594,285
  Accrued liabilities                               16,494,091       11,251,757
                                                 -------------    -------------
    Total current liabilities                      164,280,141       78,427,502

Long-term obligations, excluding
 current installments                               38,042,951       11,029,022
Deferred income taxes                                2,667,912          503,348
                                                 -------------    -------------
    Total liabilities                              204,991,004       89,959,872
                                                 -------------    -------------

Stockholders' equity:
  Preferred stock, $.001 par value;
   authorized 10,000,000 shares; none
   issued and outstanding                                 --               --
  Common stock , $.001 par value;
   authorized 100,000,000 shares; issued
   and outstanding 42,057,347 shares at
   March 31, 1999 and 37,203,013 shares
   at June 30, 1998                                     42,057           37,203
  Capital in excess of par value                   241,334,170      186,571,673
  Accumulated (deficit)                            (24,249,486)     (12,037,840)
                                                 -------------    -------------
    Total stockholders' equity                     217,126,741      174,571,036
                                                 -------------    -------------
Total liabilities and stockholders' equity       $ 422,117,745      264,530,908
                                                 =============    =============
</TABLE>
See accompanying notes to consolidated financial statements.

                                       3
<PAGE>

                       AGRIBIOTECH, INC. AND SUBSIDIARIES

                     Consolidated Statements of Operations

                                  (Unaudited)
<TABLE>
<CAPTION>
                                                                  Nine-month period                      Three-month period
                                                                   ended March 31,                         ended March 31,
                                                           --------------------------------        --------------------------------
                                                               1999                1998                1999                1998
                                                           ------------        ------------        ------------        ------------
<S>                                                        <C>                 <C>                 <C>                 <C>
Net sales                                                  $271,975,975         139,695,295         106,435,707          75,880,434
Cost of sales                                               202,317,624         109,209,431          78,076,245          57,623,388
                                                           ------------        ------------        ------------        ------------
    Gross profit                                             69,658,351          30,485,864          28,359,462          18,257,046

Operating expenses                                           73,374,229          27,441,877          27,071,015          14,762,934
Special charges                                               1,956,946                --             1,956,946                --
                                                           ------------        ------------        ------------        ------------
    Earnings (loss) from operations                          (5,672,824)          3,043,987            (668,499)          3,494,112
                                                           ------------        ------------        ------------        ------------

Other income (expense):
  Interest expense                                           (7,836,358)         (2,904,358)         (2,257,861)         (1,794,287)
  Interest income                                               356,494             177,262              61,555              26,587
  Earnings of associated entity                                 829,184             924,842             366,128             444,960
  Other                                                         153,109             168,401             246,764            (152,758)
                                                           ------------        ------------        ------------        ------------
    Total other income (expense)                             (6,497,571)         (1,633,853)         (1,583,414)         (1,475,498)
                                                           ------------        ------------        ------------        ------------
    Earnings (loss) before income taxes                     (12,170,395)          1,410,134          (2,251,913)          2,018,614

Income tax expense (benefit)                                     41,251          (2,907,500)             11,122          (2,907,500)
                                                           ------------        ------------        ------------        ------------
    Net earnings (loss)                                     (12,211,646)          4,317,634          (2,263,035)          4,926,114

Discount and imputed dividends
 on preferred stock                                                --                80,154                --                26,718
                                                           ------------        ------------        ------------        ------------

    Net earnings (loss) attributable
     to common stock                                       $(12,211,646)          4,237,480          (2,263,035)          4,899,396
                                                           ============        ============        ============        ============

Shares of common stock used in
 computing earnings (loss)
 per common share:
    Basic                                                    39,974,001          28,044,125          41,847,074          32,416,606
    Diluted                                                  39,974,001          32,373,638          41,847,074          36,982,290
                                                           ============        ============        ============        ============

    Net earnings (loss) per common share:
      Basic                                                $      (0.31)               0.15               (0.05)               0.15
      Diluted                                                     (0.31)               0.13               (0.05)               0.13
                                                           ============        ============        ============        ============

See accompanying notes to consolidated financial statements.
</TABLE>
                                       4
<PAGE>
  
                       AGRIBIOTECH, INC. AND SUBSIDIARIES

            Consolidated Statement of Changes in Stockholders' Equity

                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                Common stock            Capital in
                                                         ---------------------------    excess-of-      Accumulated
                                                            Shares         Amount        par value       (deficit)        Total
                                                         ------------   ------------   ------------    ------------    ------------
<S>                                                      <C>            <C>            <C>             <C>             <C>
Balance at June 30, 1998                                   37,203,013   $     37,203    186,571,673     (12,037,840)    174,571,036

Common stock issued for:
  Cash                                                      2,602,820          2,603     26,288,226            --        26,290,829
  Exercise of options                                         448,499            448      1,771,277            --         1,771,725
  Exercise of warrants                                        556,410            556      6,676,364            --         6,676,920
  Acquisitions                                                961,692            962     17,318,957            --        17,319,919
  Costs related to intellectual property                      225,000            225      3,999,772            --         3,999,997
  Reduction of indebtedness                                    59,913             60        826,040            --           826,100
Allocation to warrants of proceeds from
 issuance of units including common stock
 and convertible debt                                            --             --        4,075,820            --         4,075,820
Options issued for services                                      --             --          849,452            --           849,452
Adjustment to prior issuances of common stock
 due to stock price guarantees                                   --             --       (6,667,070)           --        (6,667,070)
Amounts received pursuant to proceed sharing
 under stock price guarantees                                    --             --          574,190            --           574,190
Expenses of stock issuances                                      --             --         (950,531)           --          (950,531)
Net earnings (loss)                                              --             --             --       (12,211,646)    (12,211,646)
                                                         ------------   ------------   ------------    ------------    ------------
Balance at March  31, 1999                                 42,057,347   $     42,057    241,334,170     (24,249,486)    217,126,741
                                                         ============   ============   ============    ============    ============
</TABLE>
See accompanying notes to consolidated financial statements.

                                       5
<PAGE>

                        AGRIBIOTECH, INC AND SUBSIDIARIES

                      Consolidated Statements of Cash Flows

                                   (Unaudited)
<TABLE>
<CAPTION>
                                                       Nine-month period
                                                        ended March 31,
                                                 ----------------------------
                                                     1999            1998
                                                 ------------    ------------
<S>                                              <C>             <C>
Cash flows from operating activities:
Net earnings (loss)                              $(12,211,646)      4,317,634
Adjustments to reconcile net earnings (loss)
 to net cash flows from operating activities:
   Amortization                                     5,062,733       1,514,164
   Depreciation                                     3,550,306       1,298,251
   Equity in earnings of associated entity           (829,184)       (924,842)
   Deferred income taxes                               (1,100)     (2,957,824)
   Options issued for services                        849,452            --
   Changes in assets and liabilities excluding
    effects of acquisitions:
       Accounts receivable                        (29,012,133)    (21,703,445)
       Inventories                                (25,176,639)    (13,781,556)
       Other Assets                                  (951,000)       (336,122)
       Accounts payable                            21,183,687       4,981,239
       Accrued liabilities                         (2,828,581)     (1,956,038)
                                                 ------------    ------------
   Net cash flows from operating activities       (40,364,105)    (29,548,539)
                                                 ------------    ------------
Cash flows from investing activities:
  Additions to property, plant and equipment       (9,534,789)     (2,820,736)
  Additions to intangible assets                     (503,842)        (81,081)
  Distributions from (advances to) associated
   entity                                             459,560         557,501
  Acquisitions                                    (44,067,983)    (38,294,819)
  Change in net assets held for sale                9,345,034            --
  Amounts received (paid) pursuant to stock
   price guarantees and proceed sharing              (425,810)           --
                                                 ------------    ------------
     Net cash flows from investing activities     (44,727,830)    (40,639,135)
                                                 ------------    ------------
Cash flows from financing activities:
  Net proceeds (repayments) of short-term debt      32,126,061      6,464,346
  Additions to long-term debt                       23,297,000      5,000,000
  Reductions of long-term debt                      (5,442,450)    (9,988,111)
  Payments on amount due in connection with
   acquisitions                                           --       (5,200,000)
  Sale of common stock                              26,290,829     48,125,002
  Exercise of options                                1,771,725      2,306,192
  Exercise of warrants                               6,676,920     15,556,875
  Allocation to warrants of proceeds from
   issuance of common stock and convertible
   debt                                              4,075,820           --
  Expenses of stock issuances                         (950,531)    (1,653,434)
  Payments received on notes receivable from
   sale of stock                                          --        9,990,000
                                                   -----------    -----------
     Net cash flows from financing activities       87,845,374     70,600,870
                                                   -----------    -----------
     Net increase (decrease) in cash and cash
      equivalents                                    2,753,439        413,196
Cash and cash equivalents at beginning of period     2,700,846      2,553,634
                                                   -----------    -----------
Cash and cash equivalents at end of period         $ 5,454,285      2,966,830
                                                   ===========    ===========
</TABLE>
See accompanying notes to consolidated financial statements.

                                       6
<PAGE>

                       AGRIBIOTECH, INC. AND SUBSIDIARIES

                      Consolidated Statements of Cash Flows

                                   (Unaudited)
<TABLE>
<CAPTION>
                                                         Nine-month period
                                                          ended March 31,
                                                   ----------------------------
                                                       1999            1998
                                                   ------------    ------------
<S>                                                <C>             <C>
Supplemental Cash Flow Information:
Interest paid                                      $  7,842,937       2,821,988
                                                   ============    ============
Non cash investing and financing activities:
   Accrued costs of acquisitions                   $    595,325         735,000
   Common stock issued to reduce indebtedness           826,100         447,871
   Common stock issued in acquisitions               17,319,919      36,802,595
   Amount due in connection with acquisitions              --        15,250,000
   Common stock to be issued in acquisitions               --        14,615,000
   Common stock issued for costs related to
    intellectual property                             3,999,997            --
   Debt issued in connection with acquisitions        4,890,000            --
   Adjustment to prior issuances of common stock
     due to stock price guarantees                    6,667,070            --
                                                   ============    ============

Summary of assets and liabilities acquired
 through acquisitions:
   Cash                                            $  1,126,805       1,280,985
   Accounts receivable                               12,673,740      12,502,486
   Inventories                                       16,340,066      29,734,680
   Net assets held for sale                           9,345,034            --
   Property, plant and equipment                     11,793,755      16,870,511
   Intangible assets                                 51,487,998      73,693,692
   Other assets                                         651,007       1,573,808
   Accounts payable and accrued expenses            (14,952,272)    (14,162,354)
   Long-term and short-term debt                    (19,252,283)    (29,771,909)
   Deferred income taxes                             (1,809,143)        (93,500)
                                                   ------------    ------------
         Net assets acquired                       $ 67,404,707      91,628,399
                                                   ============    ============
</TABLE>
See accompanying notes to consolidated financial statements.

                                       7
<PAGE>
                       AGRIBIOTECH, INC. AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                             March 31, 1999 and 1998
                                   (Unaudited)
================================================================================
(A)      Presentation of Unaudited Financial Statements
         -----------------------------------------------

AgriBioTech,   Inc.  ("ABT"  or  the  "Company")  is  a  vertically   integrated
agricultural  seed company  specializing  in developing,  breeding,  processing,
packaging  and  distributing  varieties  of forage (hay  crops) and  cool-season
turfgrass seeds. The Company also distributes corn, soybean, and other seeds and
certain non-seed items as ancillary products. Since January 1, 1995, the Company
has followed a business strategy to acquire regionally based seed companies with
proprietary  products and  established  research,  production  and  distribution
channels  in their  respective  markets  in order  to build a  consolidated  and
vertically   integrated   forage  and   turfgrass   seed  company  to  lead  the
transformation of that sector of the seed industry.

The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect  the  reported  amounts  of assets  and  liabilities  and  disclosure  of
contingent  assets and  liabilities at the date of the financial  statements and
the  reported  amounts of revenues  and expenses  during the  reporting  period.
Actual results could differ from those estimates.

The  unaudited  consolidated  financial  statements  included  herein  have been
prepared in accordance with the rules of the Securities and Exchange  Commission
and,  therefore,  do not include all information  and footnotes  necessary for a
fair presentation of financial  position,  results of operations and cash flows,
in conformity with generally  accepted  accounting  principles.  The information
furnished,  in the opinion of management  reflects all  adjustments  (consisting
primarily  of  normal  recurring  accruals)  necessary  to  present  fairly  the
financial position, results of operations and cash flows for the three-month and
nine-month  periods  ended March 31, 1999 and 1998.  The  Company's  business is
subject to wide seasonal fluctuations and, therefore,  the results of operations
for periods less than one year are not  necessarily  indicative of results which
may be expected for any other interim period or for the year as a whole.

Certain  reclassifications  have been made to amounts shown for prior periods to
conform to the current-quarter presentation.

(B)      Acquisitions
         -------------

From July 1, 1998 through  March 31, 1999,  the Company  completed the following
acquisitions:
<TABLE>
<CAPTION>
                                                                  Purchase Price
         Company                               Acquisition Date   (In millions )
-----------------------------                  ----------------   --------------
<S>                                            <C>                   <C>    
Geo. W. Hill & Co. (KY)                        July 8, 1998          $   6.3
Fine Lawn Research, Inc.                       July 8, 1998              2.7
Geo. W. Hill of Indiana, Inc.                  July 10, 1998             1.5
J & M Seed Company                             July 21, 1998             3.4
Willamette Seed Company                        August 21, 1998          10.8
Allied Seed Company                            August 28, 1998          14.0
Oseco Inc.                                     September 1, 1998         4.3
Garden West Distributors                       September 18, 1998        6.5
HybriGene, LLC                                 January 22, 1999         11.5
</TABLE>

The net purchase price of these  acquisitions was paid through 961,692 shares of
ABT common  stock valued at  approximately  $17.3  million,  based on the market
price of ABT's common stock when the terms of the agreements were reached,  with
the remainder paid in cash or seller provided  financing.  Each  acquisition was
recorded using the purchase method of accounting.

As discussed in note 1(b) of Notes to the Consolidated  Financial  Statements in
the  Company's  June 30,  1998 Form 10-K,  as  amended,  the  Company  had taken
effective control of acquired businesses as of a mutually agreed upon effective

                                       8
<PAGE>
                       AGRIBIOTECH, INC. AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                             March 31, 1999 and 1998
                                   (Unaudited)
================================================================================
date that preceded the closing date when  consideration  was  transferred to the
sellers.  Through  March 31,  1998,  the  Company  has  reflected  the  acquired
businesses in its  Consolidated  Financial  Statements as of the effective date.
After April 1, 1998,  the Company is reflecting  the acquired  businesses in its
Consolidated Financial Statements as of the closing date.

The  business of  Willamette  Seed  Company  ("Willamette")  consisted of a seed
division and a division that manufactures fertilizer and distributes fertilizers
and other chemicals.  Willamette's  fertilizer  division was outside the primary
strategic  focus of the Company's  business and,  accordingly,  when the Company
purchased  Willamette in August 1998,  it intended to dispose of the  fertilizer
division.  On December 22, 1998,  the Company sold the assets of the  fertilizer
division for $10.5 million with  approximately $7.5 million paid in cash and the
balance paid through the  assumption of trade  payables and other selected debt.
Under Issue No. 87-11 of the Emerging Issues Task Force, the operating income of
the fertilizer division aggregating  approximately $277,000,  including interest
charges of  approximately  $336,000,  during the period owned by the Company has
been excluded from the Company's  consolidated results of operations.  The sales
price for the  fertilizer  division  approximated  the estimated net  realizable
value at the date of acquisition and no gain or loss was recognized.

During the year ended June 30, 1998, the Company  consummated  the  acquisitions
described  in  Note 1 of  Notes  to  Consolidated  Financial  Statements  in the
Company's June 30, 1998 Form 10-K. Unaudited pro forma results of operations for
the three-month and nine-month  periods ended March 31, 1999 and 1998,  assuming
all acquisitions,  had occurred at the beginning of the period presented, are as
follows:

<TABLE>
<CAPTION>
                                      Three-month period ended
                                              March 31,
                                   ------------------------------
                                       1999             1998
                                   -------------    -------------
<S>                                <C>                <C>        
Total sales                        $ 149,064,152      149,662,532
Intercompany sales                    42,628,445       28,098,893
Net sales                            106,435,707      121,563,639
Gross profit                          28,359,462       27,735,914
Operating income (loss)                 (778,730)       5,487,127
Net earnings (loss)                   (2,373,158)       7,651,666
Net earnings (loss) attributable
 to common stock                      (2,373,158)       7,624,948
Net earnings (loss) per share:
    Basic                                  (0.06)            0.18
    Diluted                                (0.06)            0.17

                                      Nine-month period ended
                                              March 31,
                                   ------------------------------
                                       1999             1998
                                   -------------    -------------
<S>                                <C>                <C>        
Total sales                        $ 368,742,359      351,351,712
Intercompany sales                    89,635,396       37,830,430
Net sales                            279,106,963      313,521,282
Gross profit                          70,927,439       69,334,369
Operating income (loss)               (7,340,443)       3,100,240
Net earnings (loss)                  (13,551,570)       4,186,212
Net earnings (loss) attributable
  to common stock                    (13,551,570)       4,106,058
Net earnings (loss) per share:
    Basic                                  (0.33)            0.10
    Diluted                                (0.33)            0.09
</TABLE>

The  Company  entered  into  letters  of  intent  to  acquire  the  alfalfa  and
international sorghum business units of AgriPro Seeds, Inc. ("ABI"),  Moore Seed
Processors and Production  Plus+.  See note H included herein regarding ABI. The

                                       9
<PAGE>
                       AGRIBIOTECH, INC. AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                             March 31, 1999 and 1998
                                   (Unaudited)
================================================================================
Company has postponed the other two  transactions  and there can be no assurance
any of the three will ever be completed.

During the nine-month  period ended March 31, 1999, ABT purchased  approximately
15% of  Kimeragen,  Inc.'s  common stock and  acquired an  exclusive  world-wide
license to use Kimeragen's  patented technology to develop genetically  improved
forage and  turfgrass  species.  Consideration  for the license and  purchase of
Kimeragen's  common stock was an aggregate of $4.0 million,  payable in the form
of 225,000 shares of ABT's common stock.

(C)      Long-Term Obligations
         ----------------------

During the  nine-month  period  ended March 31,  1999,  the  Company  sold $23.3
million of  convertible  debentures  and 1.7 million  warrants  to purchase  the
Company's  common stock.  The Company  received an aggregate of $25 million from
this transaction.  The debt is due on December 30, 2001 and bears interest at 5%
per annum,  which the Company has the option of paying in cash or the  Company's
common  stock.  The debt is  subordinated  to the  Company's  revolving  line of
credit.  The debt is convertible  into the Company's  common stock at $13.68 per
share,  a 10% premium  above the $12.44 price of the  Company's  common stock on
December 29, 1998, when the  transaction was priced.  The Company has the option
to redeem the debt every six months beginning June 30, 1999 at redemption prices
beginning at 120% of the outstanding amounts and escalating thereafter.  On each
redemption date that the Company does not redeem the debt, the conversion  price
is  adjusted  to the  market  price at that time if such price is lower than the
conversion  price.  In addition,  the conversion  price is subject to adjustment
under standard  anti-dilution  provisions or, for five days  thereafter,  if the
Company  enters  into  certain  capital  transactions  at  prices  less than the
conversion price. On April 15, 1999, the Company announced its intent to pay off
the subordinated convertible debentures in full with cash to prevent a resetting
of the amount of shares  into which the debt can be  converted.  The  difference
between  the  amount  paid to retire the debt and the  amount  reflected  on the
Company's books would be reflected as an extraordinary item.

Each warrant is exercisable to purchase one share of the Company's  common stock
at $15.00 per share  through  December 29,  2001.  The warrants are subject to a
mandatory  conversion  requirement if the closing price of the Company's  common
stock equals or exceeds $25.00 for 20 of 30 consecutive trading days.

(D)      Short-Term Debt
         ----------------

The Company  has a $100  million  revolving  line of credit with Bank of America
Business  Credit and other  lenders  expiring in June 2001.  In April 1999,  the
lenders  under the  revolving  line of credit  provided  the  Company a seasonal
increase  of $10.0  million,  which  allows up to $110.0  million to be borrowed
through June 30, 1999 subject to availability limitations.  Borrowings under the
revolving  line of credit were $98.2  million at March 31, 1999. At May 7, 1999,
the Company had borrowed  $96.5 million  under the revolving  line of credit and
$12.4 million was available to be borrowed. Interest is payable monthly based on
a variable rate that averaged 7.6% at March 31, 1999.

Borrowings  under the revolving  line of credit are subject to a borrowing  base
computation and compliance with certain financial covenants. Compliance with the
financial  covenants  is tested on a quarterly  basis when  quarterly  financial
information  is available.  At March 31, 1999, the Company was not in compliance
with the debt service coverage  covenant under the revolving  credit  agreement.
The lenders have waived compliance with this requirement. The Company is working
with  the  lenders  to amend  such  covenant  to be  reflective  of its  current
operating  configuration  in a manner that should  lessen the  likelihood of the
need for similar  waivers in the future.  However,  there is no  assurance  such
amendment will be obtained.

                                       10
<PAGE>
                       AGRIBIOTECH, INC. AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                             March 31, 1999 and 1998
                                   (Unaudited)
================================================================================
In July 1998, the Company  obtained a $15 million bridge loan from Deutsche Bank
AG and in August 1998 the Company  obtained a $15 million  overadvance  facility
under its  revolving  line of credit.  Both of these  borrowings  were repaid in
early January 1999.

(E)      Capital Stock
         --------------

Since June 30, 1998,  the Company has  increased its  outstanding  stock options
through  grants to new employees and  consultants  and options for all employees
(including former owners) of acquired entities who continued employment with the
Company.  These option grants were for an aggregate of approximately 0.7 million
shares of the Company's  common stock from the Company's  Employee  Stock Option
Plan and 1.6 million shares outside of this plan at exercise prices ranging from
$5.00 to $25.00.

In August 1998,  the Company sold  1,752,820  shares of common stock and 886,410
warrants for an aggregate of $17,438,649.  Each warrant is exercisable for three
years to purchase one share of the Company's common stock at $12.00. The Company
can force the  warrants to be  converted  into common  stock if the closing sale
price of the Company's common stock equals or exceeds $19.50 per share for 20 of
30 consecutive trading days. Of theses warrants, 556,410 have been exercised.

In December  1998,  the Company sold 850,000  shares of common stock and 600,000
warrants for an aggregate of $11,225,000.  Each warrant is exercisable for three
years to purchase one share of the Company's common stock at $15.00. The Company
can force the  warrants to be  converted  into common  stock if the closing sale
price of the Company's common stock equals or exceeds $25.00 per share for 20 of
30 consecutive trading days.

 (F)     Earnings per Share
         -------------------

The  components  of shares of common stock used in computing  earnings per share
are as follows:
<TABLE>
<CAPTION>
                                 Nine-month period         Three-month period
                                   ended March 31            ended March 31
                              -----------------------   -----------------------
                                 1999         1998         1999         1998
                              ----------   ----------   ----------   ----------
<S>                           <C>          <C>          <C>          <C>
Basic (weighted average
 shares outstanding)          39,974,001   28,044,125   41,847,074   32,416,606
Options and warrants                --      4,031,214         --      4,261,095
Convertible preferred stock         --        298,299         --        304,589
                              ----------   ----------   ----------   ----------
     Diluted                  39,974,001   32,373,638   41,847,074   36,982,290
                              ==========   ==========   ==========   ==========
</TABLE>

Due to net losses for the 1999 periods presented,  instruments  convertible into
common stock were  anti-dilutive and do not impact earnings (loss) per share. At
March 31, 1999, the Company had options  having  aggregate  exercise  amounts of
$83.2 million for 9.1 million shares of common stock,  warrants having aggregate
exercise  amounts of $48.8 million for 3.2 million  shares of common stock,  and
$23.3 million of subordinated debt convertible into 1.7 million shares of common
stock.

(G)      Income Taxes
         -------------

The Company  provides  income taxes for interim  periods  based on the Company's
estimate of its effective income tax rate for the corresponding fiscal year. The
Company  anticipates its effective  income tax rate for the year ending June 30,
1999 will be approximately  zero.  During the three months ended March 31, 1998,
the Company concluded it was more likely than not that deferred tax assets would
be realized and, accordingly, recognized approximately $2.9 million as an income
tax benefit.

                                       11
<PAGE>
                       AGRIBIOTECH, INC. AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                             March 31, 1999 and 1998
                                   (Unaudited)
================================================================================
(H)      Commitments and Contingencies
         ------------------------------

The Company,  in connection  with Garst Seed Company,  a member of Advanta Seeds
Group,  offered to purchase  AgriPro Seeds,  Inc.  ("ABI") from Helena  Chemical
Company  ("Helena").  The Company's  intent was to purchase the alfalfa business
unit and the international sorghum business units, and Garst was to purchase the
corn,  soybean,  wheat,  cotton,  sunflower and domestic sorghum business units.
Although  Garst  completed  its  portion  of  the  acquisition,   the  Company's
transaction  was not  finalized.  On or about  January 7, 1999,  Helena sued the
Company  alleging  breach of contract,  libel and  violations  of the  Tennessee
Consumer Protection Act and seeking unspecified and trebled damages. The Company
believes  the suit is  without  merit  and will  defend it  vigorously.  ABT has
answered the complaint and denied the material  allegations  and  counterclaimed
against Helena.

Between January 14, 1999 and March 19, 1999,  fourteen  securities  class action
complaints  were filed  against the Company and certain of its former  directors
and current and former  officers  in federal  court in New Mexico,  New York and
Nevada.  The lawsuits were filed on behalf of purported classes of purchasers of
ABT common stock between  various dates ranging from  September 24, 1997 through
February 16, 1999.The complaints are presently all pending in the federal courts
in Nevada and contain allegations concerning,  among other things, the Company's
financial statements, including the accounting treatment for acquisitions closed
in 1997 and 1998,  and certain  statements  made by the Company  concerning  its
efforts to find a strategic  equity  investor  in late 1998 and early 1999.  The
complaints  allege that the Company's  statements on these and other topics were
false and misleading and caused an artificial rise in the Company's common stock
price in violation of Section 10(b) of the Securities  Exchange Act of 1934 (the
"Exchange Act") as amended, Rule 10b-5 promulgated thereunder, and Section 20 of
the Exchange  Act.  The Company  believes it has  meritorious  defenses to these
actions and intends to defend itself  vigorously.

However,  due to the risks of  litigation,  a prediction of the final outcome of
these proceedings  cannot be made with certainty,  and an unfavorable  result in
any of these actions could have a material adverse impact.

In connection with  acquisitions of businesses and intellectual  property rights
where the  owners  received  ABT  common  stock as part of the  purchase  price,
"lock-up  agreements"  were  executed  that limit the amount of ABT common stock
that the recipients can sell within  specified  time periods.  In addition,  the
Company guaranteed the proceeds to be received by certain of the recipients from
the sale of the common stock if sold in accordance with the lock-up  agreements.
Through  December 31, 1998,  the Company was not required to provide  additional
consideration under the guarantee agreements.

However,  due to  declines  in the price of the  Company's  common  stock  since
December 31, 1998, there are five such arrangements  where common stock has been
sold for less than the guaranteed  price.  These five  arrangements,  which were
entered into from June 1998 through January 1999,  guaranteed that $21.9 million
would be received  from the 1.2  million  shares of ABT common  stock  issued in
these  transactions  when sold  pursuant to the lock-up  agreements.  The common
stock  issued  in  these  transactions  was  recorded  at  values  equal  to the
guaranteed  prices.  Through March 31, 1999,  approximately  617,000 shares have
been sold by the recipients who received proceeds of approximately $4.5 million,
which is  approximately  $6.7 million less than the guaranteed  amounts.  Two of
these  arrangements  have been modified  whereby the  recipients  have agreed to
suspend  sales of the  Company's  common stock until after June 30, 1999 and the
Company  has agreed to make cash  payments  aggregating  $2.8  million  that are
credited  against  the  guaranteed  amounts to be  received  by the  recipients.
Otherwise,  the terms of the original  agreements were not changed. In addition,
certain  recipients  were  granted  options to purchase an  aggregate  of 95,000
shares of the Company's common stock at $5.00, which equaled the market price at
the time of grant.

                                       12
<PAGE>
                       AGRIBIOTECH, INC. AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                             March 31, 1999 and 1998
                                   (Unaudited)
================================================================================
Generally accepted  accounting  principles  provide that additional  obligations
under stock  issued with a  guaranteed  price be  recorded  with a  simultaneous
reduction in the amount previously  recorded for the stock issued.  Accordingly,
in the  three-month  period  ended March 31,  1999,  the Company  established  a
current  liability  for the  $6.7  million  with a  corresponding  reduction  in
stockholders'  equity.  Of this  amount,  $1.0 million was paid in cash prior to
March 31, 1999,  $2.9  million will be paid in cash prior to June 30, 1999,  and
$0.7  million will be paid in cash prior to September  30, 1999.  The  remaining
$2.1 million can be satisfied  through the issuance of additional  shares of the
Company's common stock or the payment of cash, at the Company's option.

If the shares  remaining to be sold pursuant to these  agreements are sold at an
average of $7.00 per share, the proceeds  received would be  approximately  $6.7
million less than the amounts guaranteed to be received for such shares. Of this
amount, it is anticipated that  approximately $2.2 million would be paid in cash
with the  remaining  $4.5 to be  satisfied  through the  issuance of  additional
shares of the  Company's  common stock or the payment of cash,  at the Company's
option.

(I)      Special Charges
         ----------------

Special charges include  restructuring and other integration related costs which
are non-recurring or infrequent in occurrence.  Certain  management  integration
and restructuring related decisions have been made and implemented through March
31, 1999. The costs of these activities are shown as special charges.

Though March 31, 1999, the Company has completed 34 acquisitions,  most of which
have continued to be operated in a manner similar to their  operations  prior to
being  acquired.  To accomplish  the Company's  business  strategy,  it has been
necessary to build a  centralized  operational  infrastructure  ahead of revenue
growth and restructuring  driven cost savings.  The Company is in the process of
centralizing  and improving its  accounting  and data  processing  functions and
implementing a company-wide  enterprise  resource planning system to meet all of
its information systems  requirements.  The Company is nearing the completion of
formulating  a plan to  integrate  the  acquired  companies  that  includes  the
evaluation of the business processes of each operation and location to determine
their  relative  importance  to  the  Company's  overall  strategic  plan.  Such
evaluation for each operation encompasses,  among other things, staffing levels,
product  mix and focus,  locale in relation  to  customer  base,  and levels and
nature of assets utilized. In connection with the anticipated integration of the
acquired  companies,  the Company  previously  announced  it expects to record a
non-recurring charge of between $5 and $15 million during Fiscal 1999 consisting
primarily of severance and other  personnel  related costs and costs  associated
with  consolidation  of  facilities.   The  Company  expects  to  implement  its
anticipated integration plan resulting in a restructuring charge that will be at
the  high  end of this  range,  and  possibly  above  it.  Although  the  formal
restructuring plan has not been finalized, the Company has taken certain actions
and incurred certain costs in the integration process. These costs have amounted
to $1,956,946,  which are being  reported as special  charges.  Special  charges
consist  of  severance  costs  of  $764,831,  consulting  and  attorney  fees of
$402,377, travel of $420,917 and other costs of $368,821. The Company expects to
finalize and approve the restructuring plan and accrue the restructuring  charge
in the fourth quarter of fiscal 1999.

ABT has recorded a significant  amount of goodwill  relating to the acquisitions
completed to date.  Although the Company  believes that goodwill is  recoverable
from  future  operations  in its  current  operating  structure,  as part of the
Company's  planned   restructuring,   it  is  likely  that  product  portfolios,
facilities and brands will be consolidated and,  therefore,  it is possible that
some portion of goodwill will become impaired. Therefore,  management intends to
again review the  recoverability of goodwill at the time of the restructuring to
determine if any  impairment  has occurred  and, if so,  record a write-down  to
reflect  such  impairment.   A  write-down  of  goodwill  would  be  a  non-cash
expenditure and likely be additive to the restructuring charge.
--------------------------------------------------------------------------------

                                       13
<PAGE>
ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATION

The  following  discussion  and analysis of financial  condition  and results of
operations  should  be read  in  conjunction  with  the  consolidated  financial
statements  and notes  thereto of the Company  included  elsewhere  herein.  The
Company is a vertically  integrated  agricultural  seed company  specializing in
developing,  packaging,  processing  and  distributing  varieties  of forage and
cool-season  turfgrass seeds. The Company also distributes  corn,  soybean,  and
other seeds and certain  non-seed  items as ancillary  products.  Since  January
1995, the Company has grown  significantly  through  acquiring  regionally based
seed companies with proprietary  products and established  research,  processing
and  distribution   channels  in  their  respective  markets  (the  "Acquisition
Program").  These acquisitions are summarized in note 1 of Notes to Consolidated
Financial  Statements  in the  Company's  June 30,  1998 Form 10-K and note B of
Notes to Consolidated  Financial Statements herein. The results of operations of
the acquired companies have been included in the Company's  consolidated results
beginning  with the date of the  acquisition  in  accordance  with the  purchase
method  of  accounting.  As  discussed  in note 1 (b) of Notes  to  Consolidated
Financial  Statements  in the June 30,  1998 Form 10-K,  the  Company  had taken
effective control of acquired  businesses as of a mutually agreed upon effective
date that preceded the closing date when  consideration  was  transferred to the
sellers.  Through March 31, 1998, the Company reflected the acquired  businesses
in its Consolidated  Financial  Statements as of the effective date. After April
1, 1998, due to the size of the Company and the internal focus on integration of
acquired  businesses,  the Company has changed  its  acquisition  practices,  to
operate and acquire  businesses  at the closing  date,  instead of the effective
date.

Acquisitions  occurring  subsequent  to July 1, 1997 and,  therefore,  impacting
comparability of the financial information presented herein, are as follows:

<TABLE>
<CAPTION>
                                             Acquisition
Name                                         Date
----                                         -----------
<S>                                          <C>
Lofts Seed, Inc. and affiliates              January 1, 1998
Seed Corporation of America and affiliates   January 1, 1998
Zajac Performance Seeds, Inc.                January 1, 1998
Van Dyke Seed, Inc.                          January 1, 1998
Las Vegas Fertilizer, Inc.                   January 1, 1998
Discount Farm Center, Inc.                   January 24, 1998
Kinder Seed, Inc.                            February 1, 1998
The Ohio Seed Company, Inc.                  March 1, 1998
Peterson Seed Co., Inc.                      May 22, 1998
W-D Seed Growers, Inc.                       June 25, 1998
Geo. W. Hill & Co. (KY)                      July 8, 1998
Fine Lawn Research, Inc.                     July 8, 1998
Geo. W. Hill of Indiana, Inc.                July 10, 1998
J & M Seed Company                           July 21, 1998
Willamette Seed Company                      August 21, 1998
Allied Seed Company                          August 28, 1998
Oseco Inc.                                   September 1, 1998
Garden West Distributors                     September 18, 1998
HybriGene, LLC                               January 22, 1999
</TABLE>
 
The   acquisitions   and  other  operations  being  included  in  the  Company's
consolidated financial statements beginning with each of their acquisition dates
significantly  affects the  meaningfulness of comparisons drawn between periods.
Furthermore,  the seed  business is subject to wide seasonal  fluctuations  and,
therefore,  the results of periods less than twelve  months are not  necessarily
indicative of results which may be expected for an entire year. The  significant
number  of  acquisitions  and the  period  for  which  each is  included  in the
Company's  consolidated  financial  statements in relation to the seasonality of
the business cycle of each acquisition  significantly affects the meaningfulness
of comparisons drawn between periods.

This report  contains  forward  looking  statements  that  reflect  management's
current  assumptions  and estimates  regarding  future  performance and economic
conditions.  These  include,  among  others,  statements  regarding the vertical

                                       14
<PAGE>
integration  of ABT,  product  development,  demand for ABT's  products,  excess
inventories,  the status of the integration  implementation,  the  consolidation
trend of the industry,  continuing downward pressure on prices and margins,  the
integration  plan,  the range of the  non-recurring  charge,  recoverability  of
goodwill,  proprietary transformation of products, margin increases, increase in
amounts of research and development  expenditures,  future  compliance with debt
covenants,  adequacy of funding,  additional funding,  rollout of the enterprise
resource  planning  ("ERP") system,  Year 2000 readiness,  inflation , price and
quality of supply,  and weather.  Forward looking statements involve a number of
risks and uncertainties,  and are not a guarantee of future performance.  Actual
results could differ  materially.  The risks and  uncertainties  associated with
these statements  include,  but are not limited to: total acres of turfgrass and
forage planted,  customer  purchases,  deliveries and payments for ABT products,
competitive  pricing,  weather,  effective management of the integration process
and cost reductions at ABT, ability of the Company to successfully transition to
the new information systems throughout its operations,  customer response to the
integration,  overall financial condition and asset status of ABT, relationships
with and  perceptions  of  potential  lenders and  investors,  ability to obtain
additional  capital,  litigation and other factors as detailed from time to time
in the Company's SEC filings.

The above  factors have  significant  impacts on the  following  discussion  and
analysis and should be considered as part of it.

Results of Operation

Selected  information  concerning  the results of  operations  is  summarized as
follows:

<TABLE>
<CAPTION>
                           Nine-Month Period            Three-Month Period
                            Ended March 31,               Ended March 31,
                      ---------------------------   ---------------------------
                          1999           1998           1999            1998
                      ------------   ------------   ------------    -----------
<S>                   <C>            <C>            <C>             <C>       
Net sales             $271,975,975    139,695,295    106,435,707     75,880,434

Gross profit            69,658,351     30,485,864     28,359,462     18,257,046
  Percentage of net
   sales                      25.6%          21.8%          26.6%          24.1%

Operating expenses      73,374,229     27,441,877     27,071,015     14,762,934
  Percentage of net
   sales                      27.0%          19.6%          25.4%          19.5%

Special charges          1,956,946            --       1,956,946            --
  Percentage of net
   sales                       0.7%           --             1.8%           --     
</TABLE>

The Company has essentially  completed the first phase of its business  strategy
through an  acquisition  program  that  enabled  the Company to  accumulate  the
critical mass it believes is necessary to lead the  transformation of the forage
and  turfgrass  sector of the seed  industry.  The Company is now  beginning the
process of  integrating  the  acquired  businesses,  which have  generally  been
operating as they were prior to being acquired,  into a single,  customer-driven
business  entity  centered  around  the ABT name and  logo.  In the  integration
process, the Company's objectives include raising margins and reducing expenses.
The above table shows that some  improvement has been made in margins.  However,
the integration  process has not progressed to the point that operating expenses
are being  reduced.  The Company has announced  that it plans to remove at least
$14 million,  on an annualized  basis,  from its operating  expenses by June 30,
1999.

The increases in the dollar  amounts of the above items are primarily due to the
Company's   Acquisition  Program  described  above,  which  results  in  certain
operations  not being  included for the entire time  periods  listed  above.  An
integral  part  of the  Company's  business  strategy  is to  become  vertically
integrated  with  production   operations  within  the  Company  producing  seed
varieties  developed by the Company's  research  operations  and then  providing
those seeds to the Company's distribution operations. This results in sales made
by production operations that formerly were made to third parties prior to being
acquired  by  ABT,  being  made  to  ABT  owned  distribution  operations  after
acquisition.  Such sales between ABT  operations are eliminated in the Company's
consolidated  results of  operations  and  amounted to $89.1  million  (32.8% of
reported net sales) in the  nine-month  period ended March 31, 1999 (the "Fiscal
1999  Nine-Month  Period"),  $42.6 million  (40.1% of reported net sales) in the

                                       15
<PAGE>
three-month period ended March 31, 1999 (the "Fiscal 1999 Three-Month  Period"),
$32.1 million (22.3% of reported net sales) in the nine-month period ended March
31, 1998 (the  "Fiscal 1998  Nine-Month  Period")  and $22.1  million  (29.1% of
reported net sales) in the three-month  period ended March 31, 1998 (the "Fiscal
1998 Three-Month Period").

In addition,  total sales have been  negatively  impacted by less than  expected
international seed sales due to weak demand from the "Pacific Rim" countries and
weak demand in Europe.  The countries of the Pacific Rim continue to be affected
by weak economies,  the strong U.S. dollar and tightening credit. This situation
has  resulted  in a  significant  reduction  in  sales  to  customers  in  these
countries.  The demand in Europe was  negatively  impacted by higher than normal
fall moisture  patterns,  which  resulted in higher than normal seed  production
yields  and less seed  being  planted  due to wet  conditions.  Because  of this
situation,  European  companies  have continued to be net exporters of turfgrass
seed  products  instead  of  importers.  They have also  continued  to ship less
expensive  seed  into the U.S.  market,  which is  having a  negative  impact on
prices. The excess European  inventories have reduced both the amount of product
sold into the European  market and the price for which it was sold.  Forage seed
sales were  impacted by the  continuing  weakness in the  agricultural  markets.
Prices  received  by farmers for hogs and beef  cattle  have  remained  weak and
prices received for dairy products,  which had been strong,  fell significantly.
The major corn seed producers have been reducing prices in an effort to increase
their market  share.  These  developments  have  exerted a downward  pressure on
forage  prices with some prices  falling by half when  compared to the  previous
year.  Farmers are also delaying  buying  decisions in anticipation of continued
price  erosion.  These  factors have  resulted in reduced sales of forage seeds.
Overall forage seed inventories  continue to be in excess of demand,  except for
shortages of non-dormant alfalfa and annual rye grass, which negatively impacted
sales.  European  supplies are still high and some inexpensive  Canadian seed is
available.

An  important  part of the reason ABT  management  believes it can  successfully
execute the Company's  long-term  business plan is demand for ABT's  proprietary
forage and turfgrass seed products.  Through the spring of 1999, the Company has
experienced strong demand for its proprietary  products. At March 31, 1999, many
of the Company's  important,  leading forage and turfgrass seed varieties,  were
virtually  sold out.  There has been strong  demand during the winter and spring
for  the  many of  Company's  leading  proprietary  varieties  of  tall  fescue,
perennial ryegrass, annual ryegrass, alfalfa and forage sorgham.

The increase in the amount of gross profit is due to the Acquisition Program, as
described  above.  The  increase  in the  gross  profit  percentage  is due to a
combination  of factors,  primarily a change in product mix toward  higher gross
profit  proprietary  products,  a decrease  in prices of certain  seed  products
purchased by the Company that are priced much like  commodities,  which allows a
higher gross  profit  percentage  to be earned,  and a  concentration  of higher
margin  turfgrass seed sales in the Eastern United States,  partially  offset by
higher  production cost associated with the shortage of non-dormant  alfalfa and
the downward price pressure because of excess supplies.

The  worldwide  supply of  turfgrass  and forage  seed,  except for  non-dormant
alfalfa and annual ryegrass,  is in excess of demand. This oversupply  situation
was caused by the "El Nino" wet  spring  weather  pattern  which  allowed  U.S.,
Canadian and European seed growers to experience unusually large harvests during
the last crop year. The industry is following a trend towards  consolidation  in
the U.S. and in Europe.  Smaller  independent  companies  facing this trend have
responded with aggressive  pricing programs to move their excess inventories and
retain their market share.  These  conditions  are expected to continue to cause
downward pressure on prices and margins through the current crop year.

To accomplish the Company's business strategy,  it has been necessary to build a
centralized,  upgraded,  operational  infrastructure ahead of revenue growth and
restructuring driven cost savings. The Company is in the process of centralizing
and improving its accounting and data  processing  functions and  implementing a
company-wide  ERP system to meet all of its  information  systems  requirements.
This  necessitates  that  personnel and other  resources be added at the central
location  prior to the time  corresponding  resources  are  eliminated  at other
locations,  resulting  in  duplication  of costs  during the time both  existing
systems are being operated and the new system is being implemented. For example,
prior to  deciding  to  centralize  the  accounting  function,  the  Company had
approximately  60  full-time  equivalent  employees  in its  various  operations
performing accounting functions.  During the centralization process, the Company
will add 10 to 15 employees, but after centralization,  the Company believes the
accounting  function  will only require about 30  employees.  In addition,  many
businesses  acquired  since October 1, 1997,  have been  primarily  distribution
oriented.  Distribution  companies  generally  have higher  levels of  operating
expenses,  and higher gross  margins than  production  oriented  companies.  The
Company is  nearing  the  completion  of  formulating  a plan to  integrate  the

                                       16
<PAGE>
acquired  companies  that includes the  evaluation of the business  processes of
each  operation  and  location to determine  their  relative  importance  to the
Company's   overall   strategic   plan.   Such  evaluation  for  each  operation
encompasses,  among other things, staffing levels, product mix and focus, locale
in relation  to  customer  base,  and levels and nature of assets  utilized.  In
connection  with the  anticipated  integration  of the acquired  companies,  the
Company  previously  announced  it expects to record a  non-recurring  charge of
between $5 and $15 million during Fiscal 1999 consisting  primarily of severance
and other personnel  related costs and costs  associated with  consolidation  of
facilities.  The Company expects to implement its anticipated  integration  plan
resulting in a restructuring  charge that will be at the high end of this range,
and  possibly  above it. As described  in Note I to the  Consolidated  Financial
Statements, the Company has incurred special charges including restructuring and
other  integration  related  costs,  which are  non-recurring  or  infrequent in
occurrence.   Certain  management  integration  decisions  have  been  made  and
implemented  through March 31, 1999. These charges were $1,956,946 for the three
months ended March 31, 1999.

ABT has recorded a significant  amount of goodwill  relating to the acquisitions
completed to date.  Although the Company  believes that goodwill is  recoverable
from  future  operations  in its  current  operating  structure,  as part of the
Company's  planned   restructuring,   it  is  likely  that  product  portfolios,
facilities and brands will be consolidated and,  therefore,  it is possible that
some portion of goodwill will become impaired. Therefore,  management intends to
again review the  recoverability of goodwill at the time of the restructuring to
determine if any  impairment  has occurred  and, if so,  record a write-down  to
reflect  such  impairment.   A  write-down  of  goodwill  would  be  a  non-cash
expenditure and likely be additive to the restructuring charge.

The major  components  of operating  expenses  are  personnel  costs,  occupancy
expense,   vehicle  and  shipping   expenses,   outside  services,   travel  and
advertising,  all of which increased  substantially in the current year compared
to the prior year.  These increases are primarily due to costs incurred by newly
acquired entities. The major components of operating expenses are as follows:

<TABLE>
<CAPTION>
                               Nine-Month Period           Three-Month Period
                                 Ended March 31,             Ended March 31,
                           -------------------------   -------------------------
                               1999          1998          1999          1998
                           -----------   -----------   -----------   -----------
<S>                        <C>            <C>           <C>            <C>      
Personnel costs            $33,291,586    13,503,044    12,269,893     6,796,650
Occupancy expenses          11,151,615     4,656,959     4,582,063     2,651,453
Vehicle and shipping         6,948,879     1,700,787     4,077,053     1,039,496
Outside services             3,576,427       666,972     1,560,617       208,386
Travel                       2,620,281     1,168,467     1,127,925       664,397
Advertising and promotion    5,425,116     1,468,550     1,660,769       961,551
</TABLE>

Research  and  development  expenditures  were  $2,367,349  in the  Fiscal  1999
Nine-Month period and $620,754 in the Fiscal 1999 Three-Month Period compared to
$1,461,715 in the Fiscal 1998 Nine-Month  period and $542,218 in the Fiscal 1998
Three-Month Period, substantially all of which was attributable to W-L Research,
Inc.,  E.F.  Burlingham & Sons,  and Lofts Seed,  Inc.,  all of which have major
research and  development  programs.  As the Company  transforms  its forage and
turfgrass seed  businesses to proprietary  products and increases gross margins,
the Company  expects that research and  development  expenses as a percentage of
sales will continue to increase and to eventually be similar to public companies
in the other proprietary seed sectors.

The  Company's  interest  expense  increased  to  $7,836,358  in the Fiscal 1999
Nine-Month period and $2,257,861 in the Fiscal 1999 Three-Month  Period compared
to $2,904,358 and  $1,794,287  for the same periods in the prior year.  This was
primarily  due to increased  borrowings  under the Company's  revolving  line of
credit,  including a $15 million overadvance facility beginning August 1998, and
the $15 million  bridge loan from  Deutsche  Bank AG  beginning  July 1998.  The
overadvance  facility  and the  bridge  loan bore  interest  at rates  that were
considerably higher than the revolving line of credit. Under these arrangements,
the Company incurred interest expense and fees during the Fiscal 1999 Nine-Month
Period  aggregating $2.9 million.  In late December 1998 and early January 1999,
the Company issued $23.3 million of 5% subordinated  convertible debentures and,
in early January 1999, the overadvance facility and the bridge loan were repaid.

The Company  provides  income taxes for interim  periods  based on the Company's
estimate of its effective income tax rate for the corresponding fiscal year. The
Company  anticipates its effective  income tax rate for the year ending June 30,
1999 will be approximately  zero.  During the three months ended March 31, 1998,
the Company concluded it was more likely than not that deferred tax assets would
be realized and, accordingly, recognized approximately $2.9 million as an income
tax benefit.

                                       17
<PAGE>
The Company's net loss was $12,211,646 for the Fiscal 1999 Nine-Month Period and
$2,263,035 for the Fiscal 1999  Three-Month  Period  compared to net earnings of
$4,317,634 and $4,926,114  during the same periods in the prior year as a result
of the items  discussed  above.  The net loss for Fiscal 1999  includes  special
charges,  described above and in the note I of Notes to  Consolidated  Financial
Statements,  of $1,956,946.  Average common shares outstanding used in computing
earnings per common share increased due to additional  shares issued,  primarily
for cash,  acquisitions,  options and warrants. Due to net losses for the Fiscal
1999 periods presented,  currently outstanding options, warrants and convertible
debt are anti-dilutive and do not impact earnings (loss) per share.

As discussed  above,  through March 31, 1998,  the Company  recognized  acquired
businesses in its  Consolidated  Financial  Statements as of the effective  date
agreed upon with their  sellers.  If the results of  operation  of the  acquired
businesses  from the  effective  date to the closing  date were removed from the
reported   consolidated   operating  results  and  acquisitions  were  reflected
beginning  with the  closing  dates,  net sales  would  have been  approximately
$64,129,000  for the Fiscal 1998  Three-Month  Period and  $117,652,000  for the
Fiscal 1998  Nine-Month  Period and net earnings  would have been  approximately
$4,314,000 and $2,620,000 for such periods.

Liquidity and Capital Resources

EBITDA (earnings before interest, income taxes, depreciation,  and amortization)
is widely used as a measure of a company's operating performance and its ability
to  service  its  indebtedness.   EBITDA  is  not  a  measurement  of  financial
performance  under generally  accepted  accounting  principles and should not be
construed as a substitute for net earnings  (loss) as a measure of  performance,
or cash flow from  operations as a measure of liquidity.  The Company had EBITDA
(excluding  special  charges) of $6.2 in the Fiscal 1999  Nine-Month  Period and
$7.1  million  in the  Fiscal  1998  Nine-Month  Period.  For  the  Fiscal  1999
Three-Month Period, EBITDA (excluding special charges) was $5.4 million compared
to $5.3 million for the Fiscal 1998 Three-Month Period.

Net earnings (loss) adjusted for non-cash impacts of depreciation, amortization,
equity in  earnings  of  associated  entity,  deferred  taxes,  and  options for
services  amounted to ($3.6)  million in the Fiscal 1999  Nine-Month  Period and
$3.2  million in the Fiscal 1998  Nine-Month  Period.  In  addition,  during the
Fiscal  1999   Nine-Month   Period  the  Company's  net  operating   assets  and
liabilities,  excluding the effects of  acquisitions,  required the use of $36.8
million of cash compared to $32.8 million in the prior year,  which amounts were
funded by increases in short-term  debt. This resulted in the Company having net
negative cash flows from operating activities of $40.4 million during the Fiscal
1999  Nine-Month  Period  compared  to net  negative  cash flows from  operating
activities  of $29.5  million  during the Fiscal  1998  Nine-Month  Period.  The
increases  in  accounts  payable,   inventories  and  accounts   receivable  are
reflective of the seasonality of the Company's business.  During the Fiscal 1999
Nine-Month  Period,  the  Company  had net  negative  cash flows from  investing
activities of $44.7 million,  primarily from investments in property,  plant and
equipment and  acquisitions,  reduced by the proceeds  received from the sale of
the assets of the fertilizer division of the Willamette Seed Company compared to
net negative cash flows from investing activities of $40.6 million in the Fiscal
1998 Nine-Month  Period.  Also,  during the Fiscal 1999 Nine-Month  Period,  the
Company had net cash flows from financing activities of $87.8 million, primarily
due to proceeds from short-term  debt of $32.1 million,  proceeds from long-term
debt of $23.3  million  and  proceeds  from the  issuance  of  common  stock and
warrants of $38.8 million,  compared to net cash flows from financing activities
of $70.6 million during the Fiscal 1998 Nine-Month Period.

The Company had working  capital of $27.1 million at March 31, 1999, as compared
to $25.4 million at June 30, 1998. The increase in working capital was primarily
caused by the capital raising activities of the Company,  offset by cash used in
operations.  To finance  acquisitions  and ongoing  operations,  the Company has
raised  additional  equity capital.  In the Fiscal 1999 Nine-Month  Period,  the
Company  received  cash  proceeds of $26.3  million  from the sale of  2,602,820
shares  of the  Company's  common  stock,  $1.8  million  from  448,499  options
exercised,  $6.7  million  from  556,410  warrants  exercised  and $4.1  million
allocated to warrants  issued.  In addition,  as described in note C of Notes to
Consolidated Financial Statements, the Company sold $23.3 million of convertible
debentures.

The Company has a $100  million  revolving  credit  facility  with Bank  America
Business Credit ("BABC") and other lenders expiring in June 2001. In April 1999,
the lenders under the revolving  line of credit  provided the Company a seasonal
increase  of $10.0  million,  which  allows up to $110.0  million to be borrowed
through June 30, 1999 subject to availability limitations.  Borrowings under the
revolving  line of credit were $98.2  million at March 31, 1999. At May 7, 1999,

                                       18
<PAGE>
the Company had borrowed  $96.5 million  under the revolving  line of credit and
$12.4 million was available to be borrowed. Interest is payable monthly based on
a variable  rate that  averaged  7.6% at March 31,  1999.  Borrowings  under the
revolving  line of credit  are  subject  to a  borrowing  base  computation  and
compliance  with certain  financial  covenants.  Compliance  with the  financial
covenants is tested on a quarterly basis when quarterly financial information is
available.  At March 31, 1999,  the Company was not in compliance  with the debt
service coverage covenant under the revolving credit agreement. The lenders have
waived compliance with this requirement. The Company is working with the lenders
to amend such covenant to be reflective of its current  operating  configuration
in a manner that should lessen the likelihood of the need for similar waivers in
the future. However, there is no assurance such amendment will be obtained.

As discussed in note C of Notes to Consolidated  Financial Statements,  on April
15,  1999,  the  Company  announced  its intent to pay off its $23.3  million of
subordinated  convertible debentures in full with cash to prevent a resetting of
the amount of shares into which the debt can be converted. A significant portion
of the redemption is expected to be funded with  internally-generated  funds. To
the extent sufficient amounts are not available from internally-generated funds,
the Company will need to obtain additional  amounts from external  sources.  The
difference  between the amount paid to retire the debt and the amount  reflected
on the Company's books would be reflected as an extraordinary item.

The Company  believes,  based on current plans and  assumptions  relating to its
operations,   borrowings  under  its  revolving  credit  facility  will  provide
sufficient resources to substantially fund the Company's operations through June
30, 1999. However, the Company may need to seek an increase in or an alternative
to the revolving credit facility to finance  increased  working capital needs if
acquisitions  are consummated in the future.  Furthermore,  the seed business is
subject to wide seasonal fluctuations, which result in a significant increase in
the level of  inventory  prior to and during the heavier  selling  season in the
spring and related  higher levels of accounts  receivable  following such sales.
This also reflects industry practice that dictates a significant amount of sales
of  certain  products  are made with  extended  terms  through  mid  summer.  In
addition,  the seed business can be significantly impacted by the weather, which
can alter the  timing and nature of crops  planted  by farmers  which,  in turn,
affects the timing and nature of seed sales.  For these reasons,  it is possible
that the  Company may need to seek  additional  financial  resources  to finance
ongoing  operations.  In addition,  the Company may seek permanent  financing at
some point in the future to reduce its dependence on short-term debt and provide
greater financial flexibility.

The Company entered into letters of intent to acquire certain  business units of
AgriPro Seeds,  Inc.  ("ABI"),  Moore Seed Processors and Production  Plus+. See
note H of Notes to Consolidated  Financial Statements regarding ABI. The Company
has  postponed the other two  transactions  and there can be no assurance any of
the three will ever be completed.  Should any  acquisitions  be completed in the
future,  the Company will need to obtain  additional debt or equity financing to
fund the cash portion of any additional acquisitions.

In October 1998, the Company previously  announced it had retained Merrill Lynch
& Co. and Deutsche  Bank  Securities,  an affiliate of Deutsche  Bank AG, as its
investment  bankers, to explore  alternatives to maximize  shareholder value. On
January 22, 1999, the Company announced it has decided to remain independent and
to suspend formal efforts to find a strategic partner.  The Company believes its
goals can best be met by moving to an  informal  process of  working  with third
parties on a quiet basis without timeline  expectations.  See note H of Notes to
Consolidated Financial Statements.

Management Information System and Year 2000

The  Company's  Form 10-K for the year ended June 30, 1998 contains a discussion
of the Company's  process to address the  consequences of reaching the Year 2000
and  the  implementation  of an  ERP  system  to  meet  its  information  system
requirements. Approximately 90% of the Company's revenue base will be covered by
the ERP system and the remaining 10% will continue on an existing system that is
Year 2000  compliant.  As of May 13, 1999, the Company has  implemented  the ERP
system,  which is designed to be Year 2000 compliant,  for  approximately 45% of
its revenue base.  The  remaining  revenue base is expected to implement the ERP
system by  September  1999.  The Company is also in the process of  installing a
wide area  network to support the ERP system and internal  communications.  Year
2000  compliance  statements  for all hardware,  software and service  providers
associated with this infrastructure have been obtained and are on file.

                                       19
<PAGE>
In addition,  a preliminary survey of internal systems has been completed.  This
survey indicated that existing local area networks,  desktop  operating  systems
and desktop hardware are, in many cases, not compliant. As a result, an in-depth
inventory assessment and testing of all internal systems regarding Year 2000 was
conducted. During this process, all hardware was inventoried and tested by using
a third-party Year 2000 software  application.  The Company has three sites that
have local  area  networks  that are not Year 2000  compliant.  These  sites are
expected to be upgraded by July 31, 1999.  All desktop  systems that the Company
plans to retain are Year 2000 compliant and all desktop  applications  are being
upgraded  to  various  Microsoft  products  which are Year 2000  compliant.  Any
non-compliant  equipment will be replaced or upgraded by approximately  June 30,
1999.

An in-depth survey of all vendors and major customers  regarding their Year 2000
compliance  is in  process.  To  date,  the  Company  has  Year  2000  readiness
certificates  on  file  for 70% of our  major  customers  and  80% of our  major
vendors.  This process is expected to be completed by June 30, 1999. A statement
of Year  2000  compliance  has  been  received  from  99% of  critical  vendors,
including the long  distance and wireless  service  provider and local  exchange
carriers. This process for the remaining critical vendors should be completed by
May 30, 1999.

Cumulative  expenditures on the project are  approximately  $6.4 million through
March 31, 1999.  Total costs for this project are estimated to be  approximately
$7.5  million.  This figure  represents  an increase  of $1.5  million  over the
previous estimate due to the decision to implement additional modules of the ERP
system and costs  associated with certain design changes required to accommodate
changes in the Company's operating structure.

Inflation

Management does not consider that inflation has had a significant  effect on the
Company's  operations  to date,  nor is  inflation  expected  to have a material
impact in the United  States.  The cost of seed products is largely  affected by
seed yields and alternative  crop prices,  which have not generally been greatly
impacted by inflation.  However, there has been some upward movement in the cost
of goods sold as a result of worldwide shortages of crops such as alfalfa,  corn
and wheat.  The costs which are normally  impacted by inflation,  such as wages,
transportation  and energy,  are a relatively  small part of the Company's total
operations.  However,  the  Company  remains  subject  to  possible  significant
inflation in Mexico, Argentina and other foreign countries.

Impacts of Accounting Standards not yet Adopted

The impacts of recently adopted  accounting  standards is discussed in Note 2 of
Notes to  Consolidated  Financial  Statements in the Company's Form 10-K for the
year ended June 30, 1998.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

No material changes in the quantitative and qualitative disclosures about market
risk have occurred from the discussion  contained in the Company's Form 10-K for
the year ended June 30, 1998.

                           PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

On or about January 7, 1999,  Helena  Chemical  Company  ("Helena")  commenced a
civil lawsuit in the U.S.  District Court for the Western  District of Tennessee
alleging  breach of  contract,  libel and  violation of the  Tennessee  Consumer
Protection  Act. The suit resulted from the failure by the parties to finalize a
proposed   acquisition  from  Helena  of  the  alfalfa  business  unit  and  the
international sorghum business unit of Helena's subsidiary,  AgriPro Seeds, Inc.
The  Company  believes  the  suit is  without  merit  and it  will  be  defended
vigorously.  The Company has  answered  the  complaint  and denied the  material
allegations and counterclaimed against Helena.

Between January 14, 1999 and March 19, 1999,  fourteen  securities  class action
complaints  were filed  against the Company and certain of its former  directors
and current and former  officers  in federal  court in New Mexico,  New York and
Nevada.  The lawsuits were filed on behalf of purported classes of purchasers of
ABT common stock between  various dates ranging from  September 24, 1997 through
February 16, 1999.The complaints are presently all pending in the federal courts
in Nevada and contain allegations concerning,  among other things, the Company's

                                       20
<PAGE>
financial statements, including the accounting treatment for acquisitions closed
in 1997 and 1998,  and certain  statements  made by the Company  concerning  its
efforts to find a strategic  equity  investor  in late 1998 and early 1999.  The
complaints  allege that the Company's  statements on these and other topics were
false and misleading and caused an artificial rise in the Company's common stock
price in violation of Section 10(b) of the Securities  Exchange Act of 1934 (the
"Exchange Act") as amended, Rule 10b-5 promulgated thereunder, and Section 20 of
the Exchange  Act.  The Company  believes it has  meritorious  defenses to these
actions and intends to defend itself  vigorously.

However,  due to the risks of  litigation,  a prediction of the final outcome of
these proceedings  cannot be made with certainty,  and an unfavorable  result in
any of these actions could have a material adverse impact.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

         (a)  Exhibits

                  27.1 Financial Data Schedule
 
                  99.1 Pro forma financial information

(b)      Reports on Form 8-K

During the quarter  ended March 31, 1999 and through May 13, 1999 the  following
Forms 8-K were filed:

Dated  December 30, 1998 and filed on January 11, 1999 - To report under Item 5,
the issuance of  convertible  subordinated  debentures  and warrants to purchase
common stock.

Dated  January 22, 1999 and filed on January 27, 1999 - To report  under Item 5,
that the  Company  had  suspended  its  previously  announced  efforts to find a
strategic equity partner.

Dated  January 22, 1999 and filed on February 5, 1999 - To report  under Item 5,
(a) the acquisition of HybriGene, LLC and to provide financial statements of the
acquired company and pro forma financial  information and (b) changes in members
of the Company's board of directors.

Amendment  filed  January  29,  1999 to report  dated  August 28, 1998 and filed
September 11, 1998 - To provide under Item 7, pro forma financial information.

Amendment filed March 23, 1999 to report dated January 6, 1998 and filed January
16, 1998 - To provide under Item 7, the financial statements of Lofts Seed Inc.

                                       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.



                                                AGRIBIOTECH, INC.,

 
 
Date:  May 14, 1999                             By:  /s/ Randy Ingram
                                                     Randy Ingram,
                                                     Co-President/CFO


                                       22