<PAGE>   1
                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

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

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

                 FOR THE QUARTERLY PERIOD ENDED OCTOBER 31, 1998
                           Commission File No. 0-10061

                           AMERICAN VANTAGE COMPANIES
        (Exact name of small business issuer as specified in its charter)


            Nevada                                         04-2709807
(State or Other Jurisdiction of                  (I.R.S. Employer Identification
Incorporation or Organization)                   No.)

6787 W. Tropicana, Ste 200, Las Vegas, Nevada                 89103
(Address of Principal Executive Offices)                    (Zip Code)

                                 (702) 227-9800
              (Registrant's Telephone Number, including Area Code)

                                       N/A
(Former Name, Former Address & Former Fiscal Year, if changed since last report)

Check whether the registrant (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements for the past
90 days.

                              Yes  X        No _____

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: Common Stock, $.01 Par Value,
15,098,963 shares at December 9, 1998.

Transitional Small Business Disclosure Format  Yes _____  No  X
<PAGE>   2
PART 1
FINANCIAL INFORMATION


ITEM 1. FINANCIAL STATEMENTS


                           AMERICAN VANTAGE COMPANIES
                          CONSOLIDATED BALANCE SHEETS
                       OCTOBER 31, 1998 AND JULY 31, 1998

<TABLE>
<CAPTION>
                                                              OCTOBER 31,      JULY 31,
                                                                 1998           1998
                                                              -----------    -----------
                                                              (UNAUDITED)
<S>                                                           <C>            <C>
                                     ASSETS
CURRENT ASSETS:
      CASH AND CASH EQUIVALENTS                               $16,540,000    $15,371,000
      CONSULTING FEE AND OTHER RECEIVABLES                        312,000        180,000
      REFUNDABLE INCOME TAXES                                          --        311,000
      DEFERRED TAX ASSET                                            4,000          4,000
      PREPAID EXPENSES                                             79,000         31,000
                                                              -----------    -----------

          TOTAL CURRENT ASSETS                                 16,935,000     15,897,000
                                                              -----------    -----------

NOTE RECEIVABLE FROM TABLE MOUNTAIN TRIBE                         329,000             --
                                                              -----------    -----------

PROPERTY AND EQUIPMENT, NET                                       177,000        180,000
                                                              -----------    -----------

LAND HELD FOR INVESTMENT OR DEVELOPMENT                         5,101,000      5,101,000
                                                              -----------    -----------

OTHER ASSETS:
      DEPOSITS AND OTHER                                            9,000          9,000
                                                              -----------    -----------

                                                              $22,551,000    $21,187,000
                                                              ===========    ===========

                      LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
      ACCOUNTS PAYABLE                                        $    20,000    $   126,000
      INCOME TAXES PAYABLE                                        163,000         10,000
      ACCRUED EXPENSES                                            250,000        143,000
                                                              -----------    -----------

          TOTAL CURRENT LIABILITIES                               433,000        279,000
                                                              -----------    -----------

NOTE PAYABLE                                                      329,000             --
                                                              -----------    -----------

COMMITMENTS                                                            --             --

STOCKHOLDERS' EQUITY:
      COMMON STOCK, $.01 PAR; 30,000,000 SHARES
        AUTHORIZED; 15,098,963 AND 15,086,463
        SHARES ISSUED AND OUTSTANDING                             151,000        151,000
      PREFERRED STOCK, $.01 PAR; 10,000,000 SHARES
        AUTHORIZED; SHARES ISSUED AND OUTSTANDING - NONE               --             --
      CAPITAL IN EXCESS OF PAR                                  3,330,000      3,324,000
      RETAINED EARNINGS                                        18,308,000     17,433,000
                                                              -----------    -----------

                                                               21,789,000     20,908,000
                                                              -----------    -----------

                                                              $22,551,000    $21,187,000
                                                              ===========    ===========
</TABLE>

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.


                                        2
<PAGE>   3
                           AMERICAN VANTAGE COMPANIES
                       CONSOLIDATED STATEMENTS OF INCOME
                  THREE MONTHS ENDED OCTOBER 31, 1998 AND 1997
                                   (UNAUDITED)


<TABLE>
<CAPTION>
                                                                       1998             1997
                                                                   ------------     ------------
<S>                                                                <C>              <C>
REVENUES:
     CASINO CONSULTING FEES                                        $  2,130,000     $  2,310,000
                                                                   ------------     ------------
COSTS AND EXPENSES:
     CASINO CONSULTING                                                  452,000          356,000
     DEATH CARE OPERATIONS                                               31,000               --
     GENERAL AND ADMINISTRATIVE                                         388,000          254,000
     AMORTIZATION AND DEPRECIATION                                        8,000           35,000
     MINORITY INTEREST IN NET INCOME OF CONSOLIDATED SUBSIDIARY              --            8,000
                                                                   ------------     ------------

                                                                        879,000          653,000
                                                                   ------------     ------------

     INCOME FROM OPERATIONS                                           1,251,000        1,657,000
                                                                   ------------     ------------
OTHER INCOME:
     INTEREST                                                           226,000          224,000
     MISCELLANEOUS                                                           --            7,000
                                                                   ------------     ------------

                                                                        226,000          231,000
                                                                   ------------     ------------

     INCOME BEFORE INCOME TAXES                                       1,477,000        1,888,000
                                                                   ------------     ------------
INCOME TAX EXPENSE:
     CURRENT:
       STATE                                                            (96,000)        (114,000)
       FEDERAL                                                         (506,000)        (607,000)
                                                                   ------------     ------------

                                                                       (602,000)        (721,000)
                                                                   ------------     ------------

     NET INCOME                                                    $    875,000     $  1,167,000
                                                                   ============     ============
EARNINGS PER COMMON SHARE:
     BASIC                                                         $       0.06     $       0.08
                                                                   ============     ============
     DILUTED                                                       $       0.05     $       0.07
                                                                   ============     ============
WEIGHTED AVERAGE NUMBER OF COMMON SHARES
     AND COMMON SHARE EQUIVALENTS:
     BASIC                                                           15,095,000       14,868,000
     STOCK OPTIONS AND WARRANTS                                         903,000        1,067,000
                                                                   ------------     ------------
     DILUTED                                                         15,998,000       15,935,000
                                                                   ============     ============
</TABLE>

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.


                                        3
<PAGE>   4
                           AMERICAN VANTAGE COMPANIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                  THREE MONTHS ENDED OCTOBER 31, 1998 AND 1997
                                   (UNAUDITED)


<TABLE>
<CAPTION>
                                                                               1998             1997
                                                                           ------------     ------------
<S>                                                                        <C>              <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
     NET INCOME                                                            $    875,000     $  1,167,000
                                                                           ------------     ------------

     ADJUSTMENTS TO RECONCILE NET INCOME TO NET CASH PROVIDED (USED) BY
       OPERATING ACTIVITIES:
       AMORTIZATION AND DEPRECIATION                                              8,000           35,000
       MINORITY INTEREST IN NET INCOME OF CONSOLIDATED SUBSIDIARY                    --            7,000
       CHANGES IN OTHER ASSETS AND LIABILITIES, NET                             285,000          193,000
                                                                           ------------     ------------

                                                                                293,000          235,000
                                                                           ------------     ------------

       NET CASH PROVIDED BY OPERATING ACTIVITIES                              1,168,000        1,402,000
                                                                           ------------     ------------

CASH FLOWS FROM INVESTING ACTIVITIES:
     NOTE RECEIVABLE FROM TABLE MOUNTAIN TRIBE                                 (329,000)              --
     PURCHASE OF LAND HELD FOR INVESTMENT OR DEVELOPMENT
       AND IMPROVEMENTS                                                              --          (57,000)
     PURCHASE OF PROPERTY AND EQUIPMENT, NET                                     (5,000)          (2,000)
                                                                           ------------     ------------

       NET CASH USED BY INVESTING ACTIVITIES                                   (334,000)         (59,000)
                                                                           ------------     ------------

CASH FLOWS FROM FINANCING ACTIVITIES:
     INCREASE IN CASH RESTRICTED AS TO USE                                           --          (14,000)
     PROCEEDS FROM LONG-TERM DEBT                                               329,000               --
     PROCEEDS FROM ISSUANCE OF COMMON STOCK                                       6,000               --
                                                                           ------------     ------------

       NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES                         335,000          (14,000)
                                                                           ------------     ------------

NET INCREASE IN CASH AND CASH EQUIVALENTS                                     1,169,000        1,329,000

CASH AND CASH EQUIVALENTS, AT BEGINNING OF PERIOD                            15,371,000       12,588,000
                                                                           ------------     ------------

CASH AND CASH EQUIVALENTS, AT END OF PERIOD                                $ 16,540,000     $ 13,917,000
                                                                           ============     ============

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
     CASH PAID FOR STATE AND FEDERAL INCOME TAXES                          $    150,000     $     14,000
                                                                           ============     ============
</TABLE>

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.


                                        4
<PAGE>   5
                           AMERICAN VANTAGE COMPANIES
                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                    YEAR ENDED JULY 31, 1998 AND THREE MONTHS
                       ENDED OCTOBER 31, 1998 (UNAUDITED)



<TABLE>
<CAPTION>
                                            COMMON STOCK                CAPITAL
                                      ---------------------------      IN EXCESS        RETAINED
                                        SHARES          DOLLARS         OF PAR          EARNINGS
                                      -----------     -----------     -----------     -----------
<S>                                   <C>             <C>             <C>             <C>
BALANCE, JULY 31, 1997                 14,867,958         149,000       4,892,000      14,400,000

ISSUANCE OF SHARES                        277,905           3,000          78,000

SHARES REPURCHASED AND RETIRED            (59,400)         (1,000)        (87,000)

RETIREMENT OF MINORITY INTEREST IN
  SUBSIDIARY                                                           (1,559,000)        (36,000)

NET INCOME FOR THE YEAR                                                                 3,069,000
                                      -----------     -----------     -----------     -----------

BALANCE, JULY 31, 1998                 15,086,463         151,000       3,324,000      17,433,000

ISSUANCE OF SHARES                         12,500              --           6,000

NET INCOME FOR THE PERIOD                                                                 875,000
                                      -----------     -----------     -----------     -----------

BALANCE, OCTOBER 31, 1998              15,098,963     $   151,000     $ 3,330,000     $18,308,000
                                      ===========     ===========     ===========     ===========
</TABLE>

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.


                                        5
<PAGE>   6
                           AMERICAN VANTAGE COMPANIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       THREE MONTHS ENDED OCTOBER 31, 1998

                                   (UNAUDITED)


NOTE 1 - BASIS OF PRESENTATION

As permitted by the Securities and Exchange Commission (SEC) under Rule 10-01 of
Regulation S-X, the accompanying consolidated financial statements and notes
have been condensed and, therefore, do not contain all disclosures required by
generally accepted accounting principles. The consolidated financial statements
include the accounts of American Vantage Companies and its subsidiaries ("the
Company"). All significant intercompany accounts and transactions have been
eliminated. For additional disclosures, refer to the Annual Report on Form
10-KSB of the Company for the year ended July 31, 1998.

In the opinion of the Company, the accompanying unaudited consolidated financial
statements contain all adjustments, consisting only of normal recurring
adjustments, necessary for a fair presentation of the results for the interim
periods.

Certain amounts in the interim period financial statements for Fiscal 1998 have
been reclassified for comparability with the current period presentation.

The computations of basic earnings per common share are based on the weighted
average number of common shares outstanding. The computations of diluted
earnings per share are based on the weighted average number of common shares and
common share equivalents outstanding. Stock purchase warrants and options
outstanding and exercisable at or below the market price are considered common
share equivalents.

Results of the interim periods are not necessarily indicative of those to be
expected for the full year.

NOTE 2 - INDIAN GAMING OPERATIONS

TABLE MOUNTAIN CASINO & BINGO

The Company has a consulting agreement with the Table Mountain Band of Indians
(the "Table Mountain Tribe") for the Table Mountain Casino & Bingo (the "Table
Mountain Casino") in Friant, California. Additionally, effective February 1,
1996, the Company and the Table Mountain Tribe signed a termination agreement of
the March 1993 agreement under which a monthly payment of $350,000 will be paid
to the Company through January 2000, subject to meeting certain thresholds.

In June 1997, the consulting agreement was amended, retroactive to May 1, 1997,
to provide a revised consulting fee schedule. The revised schedule provided for
a base monthly consulting fee of $60,000, plus additional fees of $50,000 to
$100,000 for increments of $225,000 to $500,000 or portion thereof, of monthly
casino net income in excess of the first $1.5 million of net income from casino
operations. A second amendment to the consulting agreement was signed in
November 1997. The consulting fee schedule was adjusted, effective February 1,
1998, to provide for a base fee of $50,000 and additional fees of $45,000 to
$60,000 for increments of $250,000 to $500,000 or portion thereof, of monthly
casino net income in excess of $1.5 million of net income from casino
operations. The term of the agreement was extended to June 30, 2000.


                                        6
<PAGE>   7
                           AMERICAN VANTAGE COMPANIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       THREE MONTHS ENDED OCTOBER 31, 1998

                                   (UNAUDITED)


The Company will continue to receive a monthly payment of $350,000 in accordance
with terms of the termination agreement signed in February 1996. These payments
will continue to January 2000.

The Company is obligated, under certain circumstances, to loan the Table
Mountain Tribe up to $4,000,000. As a part of this commitment, in August 1998,
the Company committed to lend to the Table Mountain Tribe up to $2,900,000 for
renovation and expansion of the Table Mountain Casino. The expansion will
increase the size of the casino by 47,000 square feet. Interest (at 9.5%) only
payments are required until April 15, 1999 and principal and interest payments
are due thereafter until December 3, 1999, the maturity date of the loan. The
loan is secured by revenues from the Table Mountain Casino. (See Note 5).

TRIBAL-STATE COMPACT

In July 1998, the tribal government leaders of the Table Mountain Tribe signed a
Tribal-State compact with the State of California. The compact contains various
stipulations and regulations regarding gaming which will be permitted at the
Table Mountain Casino.

The agreement expires January 1, 2009. It contains a renewal option for two
additional five (5) year periods upon written notice of renewal to the Governor
of California prior to the expiration date. The options for renewal may be
denied if the Tribe has been found to have engaged in unauthorized Class III
gaming on two or more occasions or has committed violations of the terms of the
compact on five or more occasions.

The compact permits two types of lottery based machines, the Indian Video
Lottery Match Game and the Indian Video Lottery Scratcher Game. The Table
Mountain Casino will be permitted to operate 975 of these machines in total. The
Table Mountain Tribe has been allotted 199 of these devices. Additional machines
may be licensed from other Federally recognized tribes for an annual fee of up
to $5,000 per machine.

The Table Mountain Casino will be permitted to operate existing video gaming
devices for an open-ended transition period so long as new electronic lottery
devices are unavailable or competing tribes continue to operate video gaming
devices without a state compact. Prototypes of the lottery based machines
proposed in the compact are presently undergoing testing at some Indian casinos,
including Table Mountain Casino. Presently, there is no way to confirm whether
the lottery based machines provided for in the compact will produce an income
stream consistent with those devices now being played at the Table Mountain
Casino. In the event the new machines do not produce an income stream consistent
with that being experienced at the Table Mountain Casino, the resulting decline
in revenue and profits of the Casino may have a materially adverse effect on the
consulting fees earned by the Company under its consulting agreement with the
Table Mountain Tribe.

The compact provides that employees of the Table Mountain Casino will be offered
California workers' compensation, unemployment insurance, disability insurance
and guaranteed the right to engage in collective bargaining activities. Patrons
of the casino will have the right to require binding arbitration of 


                                        7
<PAGE>   8
                           AMERICAN VANTAGE COMPANIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       THREE MONTHS ENDED OCTOBER 31, 1998

                                   (UNAUDITED)


player disputes. The casino must also carry public liability insurance. The
Table Mountain Casino presently offers its employees workers' compensation,
unemployment and disability insurance coverage. It also provides public
liability insurance coverage. The compact also requires the Table Mountain Tribe
to make arrangements for mitigation of environmental, police, fire, emergency or
other local services.

The compact contains an option to terminate the agreement and enter into the
alternative compact set out in a proposition ("Prop 5") on the November 1998
California state ballot if that initiative passed and was not held to be
unconstitutional. Prop 5 passed in the November ballot, however, the
constitutionality of the proposition is being challenged in the California
judicial system.

The Table Mountain Compact was sent to the Secretary of the Interior for review
and approval. On October 7, 1998, the Department of Interior ("Interior")
disapproved the Table Mountain Compact because of internal election dispute
matters. However, Interior subsequently indicated that if the entire membership
(General Council) voted to approve the compact, they would approve it
expeditiously. The membership met October 22, 1998 and the majority voted to
support the Compact.

UNITED AUBURN INDIAN COMMUNITY

In February 1996, the Company formed a joint venture with the Table Mountain
Tribe to provide consulting services to the United Auburn Indian Community ("the
Auburn Tribe"). The purpose of the joint venture was to assist in the
development of a Class II casino to be built and owned by the Auburn Tribe near
Sacramento, California. The Company had an 80% interest in the joint venture.

During the period from February 1996 through January 1998, the joint venture
provided monthly payments of $22,500 to the Auburn Tribe for tribal needs. The
payments were capitalized as consulting agreement acquisition costs. Also, the
joint venture paid for predevelopment costs incurred in the process of acquiring
land, which would be placed into trust for the Tribe. These advances to the
Auburn Tribe by the Company were capitalized. The land was to be utilized for
the casino site and other tribal uses.

In March 1998, Company management believing the project could not be completed
in a time frame that was in the best interests of its stockholders withdrew with
its joint venture partner, the Table Mountain Tribe, from the arrangement. The
joint venture and the Auburn Tribe in March 1998 signed an agreement providing
that under certain circumstances advances of $413,000 would be repaid from the
future operations of the planned Auburn casino. The Company wrote off its
investment in the project and the advances made to the Auburn Tribe ($861,000
combined) in the second quarter of Fiscal 1998. As of October 31, 1998, the
Auburn Tribe had not placed land into trust for the casino site.

NOTE 3 - CONSULTING AGREEMENT ACQUISITION COSTS

Consulting agreement acquisition costs related to the Table Mountain Tribe
contract were amortized over a 27 month period that ended in May 1998.


                                        8
<PAGE>   9
                           AMERICAN VANTAGE COMPANIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       THREE MONTHS ENDED OCTOBER 31, 1998

                                   (UNAUDITED)


NOTE 4 - G & L ACQUISITION CORP.

In September 1996, the Company formed a new subsidiary, G & L Acquisition Corp.
("G & L"). G & L sought business opportunities involving the establishment or
acquisition of a California card room, a gaming business located on a ship which
sails to international waters from home ports in the United States or elsewhere
and/or a leisure business ("Target Business").

G & L sold additional shares of its common stock through a private placement to
"accredited investors" as such term is defined in Regulation D under the
Securities Act of 1933. The private placement resulted in the sale of 1,992,000
shares at a price of $1.55 per share. The net proceeds from the sale, after the
costs of the offering, totaled approximately $2,625,000.

The Company was not able to find, within an 18 month period as provided in the
private placement memorandum, an investment that met specific investment
criteria. As a result, in the fourth quarter of Fiscal 1998, investors were
given a refund of their original investment. In connection with the refund, the
Company incurred investor reparation expenses of $550,000. The Company also
recorded a reduction of its capital in excess of par by $1,559,000 and retained
earnings by $36,000 in connection with the refund. The transaction resulted in G
& L becoming a wholly owned subsidiary at July 31, 1998. It was previously a 64%
owned subsidiary.

NOTE 5 - NOTE PAYABLE

In August 1998, the Company obtained a $2,900,000 line of credit with a bank.
The line is totally secured by certificates of deposit as monies are drawn on
the line. The line bears interest at 6.8%, interest only payments are due
monthly and the line expires and is payable on December 31, 1999. At October 31,
1998, approximately $329,000 had been drawn on the line.

NOTE 6 - SUBSEQUENT EVENT

On November 12, 1998, Sitka Restaurant Group, Inc. ("Sitka"), a wholly-owned
subsidiary of the Company, entered into a license agreement (the "License
Agreement") with World Championship Wrestling, Inc. ("WCW") to create and
develop one or more themed restaurants to be named the WCW Nitro Grill. The
Company agreed to guarantee all payments due from Sitka to WCW.

The License Agreement will commence on the earlier of May 1, 1999 or the opening
of the first WCW Nitro Grill and will remain in effect so long as Sitka
continues to open a minimum number of restaurants or, in the alternative, meet
certain minimum royalties. The License Agreement provides for Sitka to make
certain minimum guaranteed payments upon opening of each restaurant and annually
thereafter to WCW against royalties payable to WCW based on the gross sales of
food and beverages, merchandise and fee-based attractions and/or promotions.

On November 19, 1998, Sitka entered into a ten-year lease for restaurant space
with New Castle Corp. for the location of the first WCW Nitro Grill. The first
WCW Nitro Grill will be located in the Excalibur Hotel and Casino in Las Vegas,
Nevada. The Company expects to expend approximately $2,500,000 to 


                                        9
<PAGE>   10
                           AMERICAN VANTAGE COMPANIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       THREE MONTHS ENDED OCTOBER 31, 1998

                                   (UNAUDITED)


develop the restaurant.

NOTE 7 - YEAR 2000 COMPLIANCE

Currently many of the computer systems in use record years in a two-digit
format. These computer systems are unable to properly interpret dates beyond the
year 1999, which could lead to worldwide business disruptions in the processing
of information. The potential costs and uncertainties associated with this
problem will depend on many things, including the software, hardware and the
industry in which the company operates. This requires companies to coordinate
with other entities, with which they electronically interact, including
customers and suppliers.

The Company has evaluated its internal operating system and is working with
companies with which it transacts business to assess their efforts to comply
with the Year 2000 problem and the Company's resulting exposure. At this time,
it appears the aggregate cost to the Company relating to the problem will not be
material.

The Table Mountain Casino is presently undergoing the same process of evaluating
the impact of the Year 2000 problem. Although the financial impact to the
Casino, if any, is not known, it is not believed to be material.


                                       10
<PAGE>   11
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

MATERIAL CHANGES IN RESULTS OF OPERATIONS

THREE MONTH PERIOD ENDED OCTOBER 31, 1998 VERSUS THREE MONTH PERIOD ENDED
OCTOBER 31, 1997

REVENUES

Casino consulting fees in the three month period ended October 31, 1998 ("the
Fiscal 1999 Period") decreased 7.8% to $2,130,000 from $2,310,000 for the three
month period ended October 31, 1997 ("the Fiscal 1998 Period"), and were derived
from the consulting agreement the Company has with the Table Mountain Band of
Indians (the "Tribe") for the operation of the Table Mountain Casino & Bingo
(the "Table Mountain Casino"), which is located near Fresno, California.

On February 1, 1996, the Company signed a new consulting agreement with the
Table Mountain Tribe for the Table Mountain Casino. Additionally, effective
February 1, 1996, the Company and the Table Mountain Tribe signed a termination
agreement of the March 1993 agreement under which a monthly payment of $350,000
will be paid to the Company through January 2000, subject to meeting certain
thresholds.

In June 1997, the consulting agreement was amended, retroactive to May 1, 1997,
to provide a revised consulting fee schedule. The revised schedule provided for
a base monthly consulting fee of $60,000, plus additional fees of $50,000 to
$100,000 for increments of $225,000 to $500,000 or portion thereof, of monthly
casino net income in excess of the first $1.5 million of net income from casino
operations. A second amendment to the consulting agreement was signed in
November 1997. The consulting fee schedule was adjusted, effective February 1,
1998, to provide for a base fee of $50,000 and additional fees of $45,000 to
$60,000 for increments of $250,000 to $500,000 or portion thereof, of monthly
casino net income in excess of $1.5 million of net income from casino
operations. The term of the agreement was extended to June 30, 2000.

The Company will continue to receive a monthly payment of $350,000 in accordance
with terms of the termination agreement signed in February 1996. These payments
will continue through January 2000.

The Company is obligated, under certain circumstances, to loan the Table
Mountain Tribe up to $4,000,000. As a part of this commitment, in August 1998,
the Company committed to lend to the Table Mountain Tribe up to $2,900,000 for
renovation and expansion of the Table Mountain Casino. The expansion will
increase the size of the casino by 47,000 square feet. Interest (at 9.5%) only
payments are required until April 15, 1999 and principal and interest payments
are due thereafter until December 3, 1999, the maturity date of the loan. The
loan is secured by revenues from the Table Mountain Casino.

COSTS AND EXPENSES

Casino consulting expenses in the three month period ended October 31, 1998,
increased to $452,000, up by 27.0%, from $356,000 in the comparable quarter in
Fiscal 1998. This is attributed to increased employee compensation costs,
political contributions and corporate legal fees.

General and administrative expenses in the first quarter of Fiscal 1999
increased by $134,000 or 52.8% over the comparable quarter of Fiscal 1998. The
increase is attributable mainly to employee compensation, political
contributions and legal fees.


                                       11
<PAGE>   12
Amortization and depreciation was $8,000 and $35,000 in the three month periods
ended October 31, 1998 and 1997, respectively. Amortization is comprised of
consulting agreement acquisition costs related to the Table Mountain Casino
consulting agreement and were amortized over a 27 month period which ended in
May 1998.

OTHER OPERATIONAL ITEMS

Interest income, represented principally by interest on time deposits with
financial institutions, totaled $226,000 and $224,000 in the three month periods
ended October 31, 1998 and 1997, respectively.

The Company recorded provisions of $96,000 and $114,000 for State of California
income taxes for the three month periods ended October 31, 1998 and 1997,
respectively.

Provisions of $506,000 and $607,000 were recorded for Federal income taxes
currently payable for the three month periods ended October 31, 1998 and 1997,
respectively.

Net income for the three month period ended October 31, 1998 was $875,000 or
$0.05 per diluted common share compared to $1,167,000 or $0.07 per diluted
common share for the three month period ended October 31, 1997.

LIQUIDITY AND CAPITAL RESOURCES AT OCTOBER 31, 1998 AND THE THREE MONTH PERIOD
THEN ENDED

At October 31, 1998, the Company had consolidated working capital of
$16,502,000, as compared with working capital of $15,618,000 at July 31, 1998.
The change resulted principally from a combination of increases of cash
($1,169,000), consulting fee and other receivables ($132,000), prepaid expenses
($48,000), income taxes payable ($153,000), accrued expenses ($107,000), and
decreases of refundable income taxes ($311,000) and accounts payable ($106,000).

During the first three months of Fiscal 1999, the Company used $334,000 in
investing activities as compared to $59,000 used by investing activities in the
first three month period of Fiscal 1998. The Company loaned $329,000 to the
Table Mountain Tribe as part of the Company's $2,900,000 commitment to the Tribe
for the expansion of the Table Mountain Casino.

Financing activities for the three month period ended October 31, 1998 consisted
of the proceeds from advances ($329,000) on the Company's $2,900,000 line of
credit from a bank and $6,000 from the issuance of the Company's common stock.

The November 1997 amendment to the Table Mountain Casino consulting agreement
extended the consulting period to June 30, 2000. The Company is obligated during
the period of the consulting agreement, under certain circumstances, to loan the
Table Mountain Tribe up to $4,000,000. If the loan is made, it will be repaid
over the remaining period of the consulting agreement. In August 1998, the
Company committed to lend to the Tribe up to $2,900,000 for renovation and
expansion of the Table Mountain Casino. Interest (at 9.5%) only payments are
required until April 15, 1999 and principal and interest payments are due
thereafter until December 31, 1999, the maturity date of the loan. Revenues from
the Table Mountain Casino secure the loan. At October 31, 1998, approximately
$329,000 had been loaned to the Tribe.

The Company obtained a $2,900,000 line of credit from a bank. The line is
totally secured by certificates of deposit as monies are drawn on the line. The
line bears interest at 6.8%, interest only payments are due monthly and the line
expires and is payable on December 31, 1999. At October 1, 1998, approximately
$329,000 had been drawn on the line of credit.


                                       12
<PAGE>   13
In Fiscal 1997, the Company purchased approximately 40 acres of land in North
Las Vegas, Nevada for approximately $3,500,000. The Company plans to develop the
property as a funeral home and cemetery. The estimated cost to build the
project, including the acquisition of the land, ranges from $8,000,000 to
$12,000,000. In connection with the project, the Company has obtained a loan
commitment from a bank to provide up to $4,000,000 for the temporary and
permanent financing of the construction and development of the project. The
commitment expires in December 1998. Interest on the construction loan will be
charged at 1% above the prime rate on funds drawn on the loan. Upon completion
of the project, the bank has committed to provide a seven year permanent loan
with interest at 3% above an interest rate index, which is based on United
States Treasury Securities rates. Additional funds required to construct and
develop the project will be provided from cash on hand, operations, additional
financing or a combination of all three sources. Funds required for the
property's operations, after completion of construction, initially will be
provided by the Company's working capital, which is generated by other sources.
Ultimately, management anticipates that the property will generate sufficient
cash flow to maintain its operations independently. The development of this
property has been delayed while the Clark County, Nevada government finalizes
its plan for construction of a flood control project for the area. In the event
the flood control project is built as intended, the Company would not have to
build major water control culverts on the cemetery project. The Company is
awaiting additional progress on the construction of the flood control project
before it begins development of the property.

In November 1998, a wholly-owned subsidiary of the Company entered into an
agreement with World Championship Wrestling, Inc. ("WCW"), a Time Warner company
(NYSE:TWX) to create and develop one or more themed restaurants. The Company
expects to expend approximately $2,500,000 to develop the restaurant, which is
scheduled to open in the spring of 1999. The Company will fund the cost to
develop the restaurant from its working capital.

Historically, the Company has provided funds for its operations from operating
activities, financing from financial institutions and stockholders, and issuance
of common stock, and it will likely continue to use these sources of liquidity
in the future. The Company has always sought and will continue to seek other
suitable consulting contracts and/or ownership of casinos and other gaming
opportunities on and off Indian land, as well as recreational, leisure time and
entertainment ventures. Additionally, the Company will continue to pursue any
business venture, including those not previously described, which management
believes affords an opportunity to increase stockholder value. In the event any
of these opportunities come to fruition, management will consider satisfying
financing requirements from working capital, through borrowing or capital
infusion through the public or private placement of common stock of the Company
or its subsidiaries.

At October 31, 1998, the Company had revolving lines of credit totaling
$2,000,000 with two banks. One line for $1,000,000 expires in December 1998 and
bears interest at 2.5% above a referenced prime rate. Certificates of deposit
totaling $500,000 collateralize the line. The other $1,000,000 line of credit is
unsecured, expires in December 1998 and bears interest at 1% above an indexed
prime (8.0%) at October 31, 1998. At October 31, 1998, no funds were outstanding
on the lines of credit. The Company expects to renew these lines of credit under
similar terms and conditions.

In July 1998, the tribal government leaders of the Table Mountain Tribe signed a
Tribal-State compact with the State of California. The compact contains various
stipulations and regulations regarding gaming which will be permitted at the
Table Mountain Casino. The Tribe has submitted the compact to the Department of
Interior for approval. See Note 2 - "Indian Gaming Operations - Tribal-State
Compact" of Notes to Consolidated Financial Statements.

The Company has evaluated its internal operating system and is working with
companies with which it 


                                       13
<PAGE>   14
transacts business to assess their efforts to comply with the Year 2000 problem
and the Company's resulting exposure. At this time, it appears the aggregate
cost to the Company relating to the problem will not be material. The Table
Mountain Casino is presently undergoing the same process of evaluating the
impact of the Year 2000 problem. Although the financial impact to the Casino, if
any, is not known, it is not believed to be material.

Included in this Item 1, and in the Notes to the Consolidated Financial
Statements are certain forward-looking statements reflecting the Company's
current expectations. Although the Company believes that its expectations are
based on reasonable assumptions, there can be no assurance that the Company's
financial goals or expectations will be realized. Such forward-looking
statements involve known and unknown risks, uncertainties and other factors that
may cause the actual results, performance, or achievements of the Company, or
industry results, to be materially different from future results, performance,
or achievements expressed or implied by such forward-looking statements.
Numerous factors may affect the Company's actual results and may cause results
to differ materially from those expressed in forward-looking statements made by
or on behalf of the Company. The Company assumes no obligation to update or
revise any such forward-looking statements or the factors listed below to
reflect events or circumstances that may arise after this report is filed, and
that may have an effect on the Company's overall performance.


                                       14
<PAGE>   15
                                     PART II
                                OTHER INFORMATION

Item 1. See Part I, Note 2 of Notes to Consolidated Financial Statements.

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

                  (a)      Exhibits
                                    27.1 Financial Data Schedule

                  (b)      A Form 8-K was filed by the Company with the
                           Securities and Exchange Commission on December 2,
                           1998 reporting the Company's plans to develop a
                           themed restaurant. *

----------
* Incorporated by reference to the Company's Form 8-K filed with the Securities
and Exchange Commission on December 2, 1998.


                                       15
<PAGE>   16
                                   SIGNATURES


         In accordance with the requirements of the Exchange Act, the Registrant
has caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.


                                        AMERICAN VANTAGE COMPANIES

Dated:  December 11, 1998               By: /s/ Ronald J. Tassinari
        Las Vegas, Nevada                   Ronald J. Tassinari
                                            President
                                            (Principal Executive Officer)

                                            By: /s/ Roy K. Keefer
                                                Roy K. Keefer
                                                (Chief Financial Officer and
                                                Accounting Officer)


                                       16
<PAGE>   17

                                 Exhibit Index

               (a)  Exhibits
                        27.1 Financial Data Schedule









                                       17