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

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

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

For the Quarter ended                           (Commission File Number): 1-4814
March 31, 1998
                        

                              ARIS INDUSTRIES, INC.
             -----------------------------------------------------
             (Exact name of registrant as specified in its charter)

             New York                               22-1715274 
   -------------------------------              ------------------
   (State or other jurisdiction of                (IRS Employer
    incorporation or organization)              Identification No.)

                   475 FIFTH AVENUE, NEW YORK, NEW YORK 10017
               --------------------------------------------------
               (Address of principal executive offices) (Zip Code)

       Registrant's telephone number, including area code: (212) 686-5050

Indicate by check mark whether the registrant (l) has filed all reports required
to be filed by Section 13 or 15 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 [ ]

Number of shares of Common Stock outstanding         14,905,044
At March 31, 1998

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

<PAGE>

                              ARIS INDUSTRIES, INC.

                                TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION

    Item 1. Financial Statements

         a. Consolidated Balance Sheets as of March 31, 1998, 
            December 31, 1997 and March 31, 1997                           3

         b. Consolidated Statements of Operations for the Three 
            Months Ended March 31, 1998 and March 31, 1997                 4

         c. Consolidated Statements of Cash Flows for the Three
            Months Ended March 31, 1998 and March 31, 1997                 5

         d. Condensed Notes to Consolidated Financial Statements           6

    Item 2. Management's Discussion and Analysis of Financial
            Condition and Results of Operations                           12

PART II. OTHER INFORMATION

    Item 1. Legal Proceedings                                             19
            
    Item 2. Changes in Securities                                         19
            
    Item 3. Defaults upon Senior Securities                               19
            
    Item 4. Submission of Matters to a Vote of Security Holders           19
            
    Item 5. Other Information                                             19
            
    Item 6. Exhibits and Reports on Form 8-K                              19
             
SIGNATURES                                                                20




<PAGE>

                              ARIS INDUSTRIES, INC.
                                AND SUBSIDIARIES

CONSOLIDATED  BALANCE  SHEETS
<TABLE>
<CAPTION>

                                                                       March 31,     December 31,   March 31,
                                                                         1998            1997         1997
ASSETS                                                                (Unaudited)     (Audited)    (Unaudited)
                                                                      -----------    -----------   -----------
<S>                                                                   <C>            <C>              <C>     
CURRENT ASSETS:
   Cash and cash equivalents                                          $ 1,146,000    $ 1,372,000      $419,000
   Receivables                                                         19,155,000     26,274,000    14,506,000
   Inventories                                                         21,721,000     19,498,000     3,629,000
   Prepaid expenses and other current assets                            2,033,000      2,215,000     1,795,000
                                                                      -----------    -----------   -----------
                   Total current assets                                44,055,000     49,359,000    20,349,000

PROPERTY, PLANT AND EQUIPMENT, NET                                      1,459,000      1,463,000     1,219,000

OTHER ASSETS                                                            2,671,000      2,718,000     1,188,000

GOODWILL                                                               20,086,000     20,297,000    17,454,000
                                                                      -----------    -----------   -----------
                                                                      $68,271,000    $73,837,000   $40,210,000
                                                                      ===========    ===========   ===========
LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
   Trade acceptances payable                                           $2,132,000     $6,292,000      $294,000
   Accounts payable - trade                                             3,253,000      3,024,000     1,262,000
   Accrued expenses and other current liabilities                       6,170,000      7,528,000     3,631,000
   Current portion of long term debt                                      526,000      2,172,000       752,000
   Line of credit payable                                              21,150,000     18,605,000     2,000,000
                                                                      -----------    -----------   -----------
                Total current liabilities                              33,231,000     37,621,000     7,939,000

OTHER LIABILITIES                                                       1,415,000      1,472,000     1,555,000

LONG TERM DEBT,  LESS CURRENT PORTION                                  17,053,000     16,930,000    16,823,000

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY
   Common stock, par value $.01: 50,000,000 shares authorized;
     issued and outstanding 14,905,044 at March 31, 1998 and
     December 31, 1997,  11,852,544 at March 31, 1997                     150,000        150,000       119,000
   Additional paid-in capital                                          44,752,000     44,752,000    44,057,000
   Accumulated deficit                                                (28,330,000)   (27,088,000)  (30,283,000)
                                                                      -----------    -----------   -----------

                Total stockholders' equity                             16,572,000     17,814,000    13,893,000
                                                                      -----------    -----------   -----------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                            $68,271,000    $73,837,000   $40,210,000
                                                                      ===========    ===========   ===========
</TABLE>

            See condensed notes to consolidated financial statements


                                       -3-

<PAGE>

                              ARIS INDUSTRIES, INC.
                                AND SUBSIDIARIES

CONSOLIDATED  STATEMENTS  OF OPERATIONS  (UNAUDITED)

                                                      Three           Three
                                                   Months Ended    Months Ended
                                                     March 31,       March 31,
                                                       1998            1997
                                                   ------------    ------------

NET REVENUES                                       $ 17,825,000    $ 14,447,000
                                                   ------------    ------------
OPERATING COSTS:
Cost of sales                                        12,420,000       9,780,000
Selling and administrative                            6,402,000       5,064,000
                                                   ------------    ------------
TOTAL OPERATING COSTS                                18,822,000      14,844,000
                                                   ------------    ------------

LOSS BEFORE INTEREST AND DEBT EXPENSE,
   INCOME TAXES AND EXTRAORDINARY ITEM                 (997,000)       (397,000)

INTEREST AND DEBT EXPENSE, NET                          851,000         457,000
                                                   ------------    ------------
LOSS BEFORE INCOME TAXES AND
   EXTRAORDINARY ITEM                                (1,848,000)       (854,000)

INCOME TAX  (BENEFIT) EXPENSE                           (84,000)          8,000
                                                   ------------    ------------
LOSS BEFORE EXTRAORDINARY ITEM                       (1,764,000)       (862,000)

EXTRAORDINARY ITEM:
   Gain on debt forgiveness                             522,000            --
                                                   ------------    ------------
NET LOSS                                           ($ 1,242,000)   ($   862,000)
                                                   ============    ============
PER SHARE DATA:
   Weighted average shares outstanding - Basic       14,905,044      11,852,544
   Weighted average shares outstanding - Diluted     16,509,219      12,658,969

BASIC EARNINGS PER SHARE:
      Loss before extraordinary item               ($      0.12)   ($      0.07)
      Extraordinary item                                   0.04            0.00
                                                   ------------    ------------
Net Loss                                           ($      0.08)   ($      0.07)
                                                   ============    ============

DILUTED EARNINGS PER SHARE:
      Loss before extraordinary item               ($      0.11)   ($      0.07)
      Extraordinary item                                   0.03            0.00
                                                   ------------    ------------
Net Loss                                           ($      0.08)   ($      0.07)
                                                   ============    ============

See condensed notes to consolidated financial statements


                                       -4-

<PAGE>


                              ARIS INDUSTRIES, INC.
                                AND SUBSIDIARIES

                CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
<TABLE>
<CAPTION>
                                                                              Three            Three
                                                                           Months Ended     Months Ended
                                                                             March 31,        March 31,
                                                                               1998             1997
                                                                           ------------     ------------
<S>                                                                        <C>                <C>       
CASH FLOWS FROM OPERATING ACTIVITIES:
   Net loss                                                                ($1,242,000)       ($862,000)

   Adjustments to reconcile net loss to net cash 
     used in operating activities:
        Depreciation and amortization                                          404,000          322,000
        Capitalized interest                                                   151,000          135,000
        Forgiveness of debt                                                   (522,000)            --
   Change in assets and liabilities :
        Decrease / (increase) in receivables                                 7,119,000       (7,182,000)
        (Increase) / decrease in inventories                                (2,223,000)       5,605,000
        Decrease in prepaid expenses and other current assets                  182,000          181,000
        Decrease in other assets                                                13,000             --
        Decrease in trade acceptances payable                               (4,160,000)      (5,308,000)
        Increase in accounts payable - trade                                   229,000          340,000
        Decrease in accrued expenses and other current liabilities          (1,358,000)        (866,000)
        Decrease in other liabilities                                          (50,000)         (66,000)
                                                                           -----------       ----------
             Total Adjustments                                                (215,000)      (6,839,000)
                                                                           -----------       ----------
                       Net cash used in operating activities                (1,457,000)      (7,701,000)
                                                                           -----------       ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
   Capital expenditures                                                       (133,000)        (122,000)
                                                                           -----------       ----------
                       Net cash used in investing activities                  (133,000)        (122,000)
                                                                           -----------       ----------
CASH FLOWS FROM FINANCING ACTIVITIES:
   Principal payments of long-term debt                                     (1,181,000)         (36,000)
   Net proceeds / (repayments) on bank line of credit                        2,545,000        2,000,000
                                                                           -----------       ----------
                       Net cash provided by financing activities             1,364,000        1,964,000

NET DECREASE IN CASH AND CASH EQUIVALENTS                                     (226,000)      (5,859,000)

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD                               1,372,000        6,278,000
                                                                           -----------       ----------
CASH AND CASH EQUIVALENTS, END OF PERIOD                                    $1,146,000         $419,000
                                                                           ===========       ==========

CASH PAID DURING THE YEAR FOR:
   Interest                                                                   $500,000          $19,000
   Income Taxes                                                                 26,000           31,000

</TABLE>

            See condensed notes to consolidated financial statements


                                       -5-
<PAGE>

                     ARIS INDUSTRIES, INC. AND SUBSIDIARIES

              CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

1. CONSOLIDATED FINANCIAL STATEMENTS

The consolidated balance sheets as of March 31, 1998 and March 31, 1997, the
consolidated statements of operations for the three months ended March 31, 1998
and March 31, 1997, and the consolidated statements of cash flows for the three
months ended March 31, 1998 and March 31, 1997 were all prepared by the Company
without audit. In management's opinion, adjustments consisting of only normal
recurring adjustments necessary to present fairly the financial position,
results of operations and changes in cash flows for these periods have been
made.

Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been omitted or abridged in this submission. It is suggested, therefore,
that these consolidated statements be read in conjunction with the financial
statements and notes thereto included in the Company's Annual Report on Form
10-K for the year ended December 31, 1997. The operating results for the three
months ended March 31, 1998 are not necessarily indicative of the operating
results for the year ending December 31, 1998.

Effective July 15, 1997, ECI Sportswear, Inc. ("ECI Sportswear"), an indirect
wholly owned subsidiary of the Company, acquired substantially all of the assets
of Davco Industries, Inc. ("Davco"), a maker of mens' and boys' activewear,
swimwear, loungewear and some sportswear products sold under the "Perry Ellis
America" and/or "Perry Ellis" labels, "Jeffrey Banks" mens' sportswear, "FUBU"
boy's sportswear, activewear and outerwear and "Members Only" mens' and boys'
sportswear and loungewear. The operating results for ECI Sportswear are included
in the Company's results of operations for the three month period ended March
31, 1998.

2. DEBT SERVICE

The Company's long-term indebtedness consists of the debt obligations of the
Company to BNY Financial Corporation ("BNY") and AIF-II, L.P., a Delaware
limited partnership and an affiliate of Apollo Advisors, L.P. ("AIF II"). On
January 29, 1998, the Company repaid in full all of its remaining debt
obligations to Heller Financial, Inc. ("Heller"). Such payment amounted to
$1,128,000, which included accrued interest through the date of repayment.In
addition, the Company recorded an extraordinary gain on the early extinguishment
of the Heller debt in the amount of $522,000.

o    On June 30, 1993, the Company entered into a Series A Junior Secured Note
     Agreement with BNY, pursuant to which BNY received a $7 million note,
     bearing interest at a rate of 7% 


                                      -6-

<PAGE>

     per annum, with a final maturity date of November 3, 2002. BNY shares with
     AIF II a first lien on the stock of ECI. On September 12, 1997, the Company
     and BNY entered into an amendment of the BNY Note Agreement providing that
     (1) scheduled interest accruing under the BNY Note Agreement for the period
     February 1, 1996 through January 31, 1998 was not and will not be paid in
     cash and instead shall be added to principal and shall be payable on
     November 3, 2002, (2) scheduled interest under the BNY Note Agreement
     accruing for the periods commencing February 1, 1998 will be made in cash
     on quarterly payment dates commencing May 4, 1998 and (3) the principal on
     the BNY Note Agreement of $300,000 otherwise due November 3, 1997 shall be
     rescheduled and paid quarterly in installments of $15,000 each on the last
     day of each calendar quarter commencing on December 31, 1997, with any
     remaining balance due on November 3, 2002. The remaining principal of BNY's
     note is required to be paid in five annual installments, payable on
     November 3 of each year commencing in 1998 as follows:

                        YEAR              AMOUNT
                        ----            ----------
                        1998            $  300,000
                        1999               500,000
                        2000               600,000
                        2001             1,100,000
                        2002             4,200,000

     In addition, on November 3, 2002, the Company is obligated to pay BNY
     $1,042,000, representing the quarterly interest payments accruing for the
     period February 1, 1996 through January 31, 1998, which were not and will
     not be paid in cash and instead added to the principal of the BNY Note.

o    On June 30, 1993 the Company entered into a Series B Junior Secured Note
     Agreement with AIF-II, pursuant to which AIF-II received a $7.5 million
     note bearing interest at 13% per annum. AIF-II shares with BNY a first lien
     on the stock of ECI. On September 12, 1997, the Company and AIF-II entered
     into an amendment of the AIF-II Note Agreement providing that (1) scheduled
     interest accruing under the AIF-II Note Agreement for the period November
     1, 1995 through January 31, 1998 was not and will not be paid in cash and
     instead shall be added to principal and shall be payable on November 3,
     2002 and (2) scheduled interest under the AIF-II Note Agreement accruing
     for periods commencing February 1, 1998 will be made in cash on quarterly
     payment dates commencing May 4, 1998. Principal of AIF-II's note is
     required to be paid in two equal installments payable on November 3 in each
     of 2001 and 2002.

     In addition, on November 3, 2002, the Company is obligated to pay AIF-II
     $2,502,000, representing the quarterly interest payments accruing for the
     period November 1, 1995 through January 31, 1998, which were not and will
     not be paid in cash and instead added to the principal of the AIF-II Note.


                                      -7-
<PAGE>


BNY and AIF-II will also share in mandatory prepayments based upon 50% of
certain "excess cash flows" of the Company as defined in the Company's note
agreements with BNY and AIF-II.

3. GOODWILL

Goodwill represents the unamortized excess of the cost of acquiring a business
over the fair values of the net assets received at the date of acquisition. The
Company continuously evaluates goodwill for any potential impairment. The
Company assesses the recoverability of goodwill by determining whether the
amortization of the goodwill balance over its remaining life can be recovered
through projected undiscounted future cash flows.

4. INVENTORIES

                           MARCH 31       DECEMBER 31     MARCH 31
                             1998             1997          1997
                           --------       -----------     --------
                                         (IN THOUSANDS)

     Finished goods        $ 21,721        $19,498        $3,629
     Work-in process           -0-            -0-           -0-
     Raw materials             -0-            -0-           -0-
                           --------        -------        ------
                           $ 21,721        $19,498        $3,629
                           ========        =======        ======
                                               

5. ACQUISITIONS

Effective July 15, 1997, ECI Sportswear, Inc. ("ECI Sportswear"), an indirect
wholly owned subsidiary of the Company, acquired substantially all of the assets
of Davco Industries, Inc. ("Davco"), at that time a maker of mens' and boys'
activewear, swimwear, loungewear and some sportswear products sold under the
"Perry Ellis America" and/or "Perry Ellis" labels and mens' sportswear sold
under the "Jeffrey Banks" label. The aggregate purchase price, inclusive of
acquisition costs, paid by ECI Sportswear for such assets of $4,373,000
consisted of (a) the issuance to Davco of 3,000,000 shares of restricted Common
Stock of the Company valued at $720,000 and (b) a contingent cash purchase price
to Davco to be computed as the pre-tax net income of the Davco apparel business
as owned by ECI Sportswear from the closing date through December 31, 1997
(subject to certain adjustments), but not to exceed a maximum payment of
$3,600,000, such cash amount payable subsequent to issuance of the Company's
December 31, 1997 audited financial statements. On the closing date, ECI
Sportswear paid to Davco $500,000 as an advance towards the contingent cash
purchase price and ECI Sportswear paid an additional advance of $81,000
following completion of ECI Sportswear's third fiscal quarter ending September
30, 1997. The acquisition was accounted for as a purchase and, accordingly,
operating results of this business subsequent to the date of acquisition were
included in the Company's consolidated financial statements. The purchase price
was allocated based on


                                      -8-

<PAGE>

estimated fair values at the date of acquisition. This resulted in an excess of
purchase price over net assets acquired of $3,356,000, which has been recognized
as goodwill and is being amortized on a straight-line basis over 20 years. ECI
Sportswear is a wholly-owned subsidiary of Europe Craft Imports, Inc.("ECI").

The total contingent cash purchase price for the Davco assets derived from ECI
Sportswears December 31, 1997 financial statements, was $3,483,000. On April 10,
1998, the Company paid $2,660,000 in respect of the contingent purchase price
for the Davco assets, after deducting advances previously paid of $581,000 and
reserves for purchase price adjustments of $242,000.

The following unaudited pro forma consolidated results of operations for the
three months ended March 31, 1997 are presented as if the acquisition of Davco's
assets had been made at the beginning of such period. The unaudited consolidated
results of operations for the three months ended March 31, 1998 are presented
for comparison. Pro forma adjustments have been made to include the effects of
amortization of goodwill and intangible assets. The unaudited pro forma
information is not necessarily indicative of either the results of operations
that would have occurred had the purchase been made during the period presented
or the future results of the combined operations.

--------------------------------------------------------------------------------
                                          Three Months            Three Months
                                              Ended                   Ended
                                          March 31, 1997         March 31, 1998
                                           (Pro Forma)              (Actual)
--------------------------------------------------------------------------------
Net Revenues .........................     $24,282,000            $17,825,000
Gross Profit..........................       7,031,000              5,405,000
Income (loss) before        
  taxes and extraordinary item .......         (45,000)            (1,849,000)

Income tax expense ...................          32,000                (84,000)
Net income (loss).....................         (77,000)            (1,242,000)
Basic Earnings (loss) per share.......           (0.01)                 (0.08)
Diluted Earnings (loss) per share ....           (0.01)                 (0.08)
--------------------------------------------------------------------------------


                                      -9-


<PAGE>


6. INCOME TAXES

Due to significant net operating loss carryforwards, the Company does not
anticipate paying any federal income taxes for the year ending December 31,
1998, except for the alternative minimum income tax which was part of the 1986
Tax Reform Act.

A valuation allowance is recognized for those deferred tax assets that may not
be realized. At this time, the Company has determined that such a valuation
allowance be equal to the gross federal deferred tax asset, except for the
alternative minimum tax credit carryforwards and a portion of the state net
operating loss carryforwards at ECI and ECI Sportswear. The alternative minimum
tax credit carryforwards do not expire, and in the Company's opinion, it is more
likely than not that these credit carryforward will be realized.

7. PER SHARE DATA

In February 1997, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 128, "Earnings per Share" (SFAS 128), which
was effective for periods ending after December 15, 1997. The Company's prior
years earnings per share ("EPS") results have been restated to conform with the
provisions of this Statement. Under SFAS 128, the Company has presented two
earnings per share amounts. Basic EPS is calculated based on income available to
common shareholders and the weighted-average number of shares outstanding during
the reporting period. Diluted EPS includes additional dilution from potential
common stock issuable pursuant to the exercise of stock options and a warrant
outstanding.

--------------------------------------------------------------------------------
                                      Income            Shares       Per-Share
                                    (Numerator)      (Denominator)    Amount
--------------------------------------------------------------------------------
Quarter Ended 3/31/98
Basic EPS
Loss before extraordinary item .... $(1,765,000)      14,905,044      $(0.12)
                                                                     
Effect of Dilutive Securities                                        
                                                                     
Stock Options .....................        --          1,023,208    

Warrants ..........................        --            580,967     
                                    -----------       ----------
Diluted EPS Loss before 
  extraordinary item .............. $(1,765,000)      16,509,219      $(0.11)
--------------------------------------------------------------------------------

                                      -10-
<PAGE>
--------------------------------------------------------------------------------
                                     Income             Shares       Per-Share
                                    (Numerator)      (Denominator)    Amount
--------------------------------------------------------------------------------
Quarter Ended 3/31/97                                                
Basic EPS                                                            
Loss before extraordinary item .... $  (862,000)      11,852,544      $(0.07)
                                                                     
Effect of Dilutive Securities                                        
                                                                     
Stock Options .....................        --            234,783     

Warrants ..........................        --            571,642     
                                    -----------       ----------
Diluted EPS Loss before 
  extraordinary item .............  $  (862,000)      12,658,969      $(0.07)
--------------------------------------------------------------------------------

8. CONTINGENCIES

The Company and/or its subsidiaries, in the ordinary course of their business,
from time to time may be the subject of, or a party to, various legal actions
involving private interests. While the Company cannot guaranty the outcome of
any litigation, the Company and/or its subsidiaries believe that any ultimate
liability arising from any such actions which may be pending will not have a
material adverse effect on its consolidated financial position, results of
operations or cash flows at March 31, 1998.

                                      -11-


<PAGE>



                     ARIS INDUSTRIES, INC. AND SUBSIDIARIES

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

Introduction

The following analysis of the financial condition and results of operations of
Aris Industries, Inc. (the "Company") should be read in conjunction with the
consolidated financial statements, including the notes thereto, included on
pages 3 through 11 of this report.

FORWARD LOOKING STATEMENTS

Statements included in Management's Discussion and Analysis of Financial
Condition and Results of Operations which are not historical in nature, are
intended to be, and are hereby identified as, "forward looking statements" for
purposes of the safe harbor provided by Section 21E of the Securities Exchange
Act of 1934, as amended by Public Law 104-67. The Company cautions readers that
forward looking statements, including without limitation, those relating to the
Company's future business prospects, revenues, working capital, liquidity,
capital needs, interest costs, and income, are subject to certain risks and
uncertainties that could cause actual results to differ materially from those
indicated in the forward looking statements, due to several important factors
herein identified, among others, and other risks and factors identified from
time to time in the Company's reports filed with the SEC:

o    The apparel industry in general is volatile and unpredictable due to
     cyclical and seasonal swings caused in part by consumer buying patterns.

o    The Company's ECI subsidiary, which sells primarily outerwear, is
     particularly impacted by unusually warm weather or late arrival of cold
     weather. The Company's ECI Sportswear subsidiary can also be impacted by
     weather conditions.

o    There has been a substantial consolidation of formerly independent major
     department store chains such that the consolidated customers exert greater
     influence on suppliers such as the Company, resulting in greater demands
     for price reductions, advertising support, returns and markdowns of apparel
     products.

o    Retail organizations in the apparel industry have undergone
     reorganizations, bankruptcy liquidations, downsizing and/or cessation of
     business, and others have suffered credit difficulties whereby factors
     delay or deny credit to such retail organizations. As a result, the Company
     may experience difficulty in obtaining factoring and credit approval on
     certain customers.

o    Although the Company's ECI and ECI Sportswear subsidiaries 


                                      -12-

<PAGE>

     market a wide variety of products, they must compete with other apparel
     suppliers which specialize in particular niche products which may have
     greater resources, reputation and efficiencies in such particular product
     areas.

o    A substantial portion of the Company's products are manufactured overseas,
     subjecting the Company to the generic risks of import and delivery from
     distant locations, delays due to U.S. or foreign government regulation and
     controls, and customs and transportation difficulties. In addition, the
     Company could be adversely affected by tariffs, embargos and quotas
     involving countries from which the Company imports its product lines.

o    ECI and ECI Sportswear import their products primarily from manufacturing
     plants which they do not own. While ECI and ECI Sportswear, through their
     agents, exercise quality control over such factories, there are inherent
     risks in such manufacturing which can result in delivery delays and
     ultimately in cancellation of orders by there customers.

o    Increasingly, retail customers of the Company are ordering their products
     closer to the actual delivery date and selling season. In order for
     suppliers to deliver such products on time, they must often now commit to
     production in advance of obtaining firm orders from their retail customers.

o    There is an increasing trend by retail customers to develop their own
     private label apparel lines to compete with products supplied by brand name
     suppliers such as the Company.

o    No assurance can be made that the Company's licensors do not change
     policies on advertising and distribution which can have a materially
     adverse affect on the Company.

o    The Company's apparel products are sold on the main selling floor areas of
     its retail store customers and are facing increasing competition from such
     customer's expanded dedication of retail floor space to "designer
     collections".

o    At present, political instability in some countries, like Indonesia, where
     the Company sources, could have an impact on timely completion or delivery
     of finished products.

o    A large proportion of the Company's products are manufactured in Asia by
     independent contractors, whose businesses, finances and credit could be
     seriously impaired by the Asian economic crises which commenced in the
     latter half of 1997 and has continued into the first half of 1998. If there
     were a sustained loss of the Company's Asian sources of supply, the
     Company's business would be materially adversely affected. The Company is
     unable to predict the impact of the Asian economic crises on particular
     Asian countries where the Company sources its products or particular
     contractors within those 


                                      -13-

<PAGE>

     countries. The "Members Only" licensee for apparel products to be sold in
     the territory of the People's Republic of China, Hong Kong and Macau has
     maintained domestic production for such markets, but has ceased
     manufacturing products for export; there are no assurances that such
     licensee will be capable of continuing domestic production for its Chinese
     licensed territory.

     Year 2000 Compliance

     The inability of computers, software and other equipment utilizing
     microprocessors to recognize and properly process data fields containing a
     2 digit year is commonly referred to as the Year 2000 Compliance issue. As
     the year 2000 approaches, such systems may be unable to accurately process
     certain date based information.

     The Company is currently identifying all significant applications that will
     require modification to ensure Year 2000 Compliance. Internal resources are
     being used to make required modifications and test Year 2000 Compliance.
     The Company target date for completion is June 30, 1999.

     In addition, the Company has communicated with others with whom it does
     significant business to determine their Year 2000 Compliance readiness and
     the extent to which the Company is vulnerable to any third party Year 2000
     issues. However, there can be no guarantee that the systems of other
     companies on which the Company's systems rely will be timely converted, or
     that a failure to convert by another company or a conversion that is
     incompatible with the Company's systems, would not have a material adverse
     effect on the Company.

     The total cost to the Company of these Year 2000 Compliance activities is
     estimated to be approximately $75,000 and will be funded internally through
     operating cash flows. These costs and the date on which the Company plans
     to complete the Year 2000 modification and testing processes are based on
     management's best estimates, which were derived utilizing numerous
     assumptions of future events including the continued availability of
     certain third party modification plans and other factors. However, there
     can be no guarantee that these objectives will be achieved and actual
     results could differ from those plans.

FINANCIAL CONDITION

LIQUIDITY AND CAPITAL RESOURCES

As of March 31, 1998, the Company had working capital of approximately
$10,824,000 as compared to $11,738,000 at December 31, 1997 and $12,410,000 at
March 31, 1997. The decrease in working capital from December 31, 1997 to March
31, 1998 is due to funding the Company's operating loss in the first three
months offset by the extraordinary gain of $522,000 recorded by the Company in
connection 


                                      -14-

<PAGE>

with the early extinguishment the New Heller Note. During this
period, the Company financed its capital expenditures principally through
internally generated funds and credit facilities.

The Company's interest payments to its secured lenders, BNY Financial Corp.
("BNY") and AIF II, L.P. ("AIF-II") scheduled for the period January 1, 1998
through January 31, 1998 were paid in kind pursuant to amendments to the
Company's loan agreements with such lenders. The Company's interest payments to
BNY and AIF-II scheduled for the period February 1 through April 30, 1998 were
paid in cash on May 1, 1998.

On January 29, 1998, the Company repaid in full all principal and interest of
the Company's debt obligations to Heller Financial, Inc. ("Heller").

On September 12, 1997, the Company entered into amendments of its note
agreements with BNY and AIF-II providing that scheduled interest accruing under
the BNY Note Agreement for the period February 1, 1996 through January 31, 1998
and under the AIF-II Note Agreement for the period November 1, 1995 through
January 31, 1998 was not and will not be paid in cash and instead shall be added
to principal and shall be payable on November 3, 2002.

The September 12, 1997 amendments to the Company's BNY and AIF-II Note
Agreements provide that cash payments of scheduled interest to BNY and AIF-II
will resume on quarterly payment dates commencing May 4, 1998, and that the
Company must make principal payments to BNY of $15,000 on the last day of each
calendar quarter commencing December 31, 1997. In addition, the Company is
required to make annual principal payments to BNY in accordance with the
original amortization schedule of the BNY Note Agreement, commencing with a
$300,000 payment on November 3, 1998.

On May 15, 1998, the Company's operating subsidiaries renewed their working
capital credit facilities for the period through April 15, 1999. The working
capital facilities impose limitations on the level of borrowings at different
times during the year, require the operating subsidiaries to maintain certain
levels of net worth during the year, contain other covenants and reporting
requirements, and place certain limitations on the upstreaming of funds from the
operating subsidiaries to the Company. The Company believes that if the
operating subsidiaries achieve their business plans, sufficient funds may be
upstreamed to enable the Company to make scheduled payments to BNY and AIF-II
during the year ended December 31, 1998. If the operating subsidiaries do not
achieve their business plans, or the working capital lender does not permit the
upstreaming of funds in sufficient amounts, or the Company otherwise did not
have sufficient cash resources to make scheduled payments to BNY and AIF-II on
payment dates commencing August 3, 1998, the Company would intend to discuss
with BNY and AIF-II the renegotiation of required payments so as to be in
compliance with its agreements with such lenders. While such lenders have in the
past granted consents to the payment of scheduled interest in kind rather than
in cash, and/or the deferral of interest payments and principal amortization,
there are no assurances that the Company will be able to obtain such consents in
the future. If, under such circumstances, the Company cannot obtain such
consents or a renegotiation of payment schedules, the Company could on quarterly
payment dates from and after August 3,


                                      -15-

<PAGE>

1998, be in default of its obligations to such lenders.

Effective July 15, 1997, ECI Sportswear, an indirect wholly owned subsidiary of
the Company, acquired substantially all of the assets of Davco Industries, Inc.
("Davco"), at that time a maker of mens' and boys activewear, swimwear,
loungewear and some sportswear proeucts sold under the "Perry Ellis America"
and/or "Perry Ellis" labels, and mens' sportswear sold under the "Jeffrey Banks"
label. The acquisition was accounted for as a purchase. The aggregate purchase
price paid by ECI Sportswear of $4,373,000 for such assets consisted of (a) the
issuance to Davco of 3,000,000 shares of restricted Common Stock of the Company
valued at $720,000 and (b) a contingent cash purchase price computed as the
pre-tax net income of the Davco apparel business as owned by ECI Sportswear from
the closing date through December 31, 1997 (subject to certain adjustments), but
not to exceed a maximum payment of $3,600,000. Such contingent cash amount is
payable subsequent to the issuance of the Company's December 31, 1997 audited
financial statements. On the closing date, ECI Sportswear paid to Davco $500,000
as an advance towards the contingent cash purchase price and ECI Sportswear paid
an additional advance of $81,000 following completion of ECI Sportswear's third
fiscal quarter ending September 30, 1997. The total contingent cash purchase
price payable to Davco, derived from ECI Sportswears' December 31, 1997
financial statements, was $3,483,000. On April 10, 1998, the Company paid
$2,660,000 in respect of the contingent purchase price for the acquisition of
assets from Davco, after deducting advances previously paid of $581,000 and
reserves for purchase price adjustments of $242,000. ECI Sportswear's source of
funds for the cash payments of the purchase price were its internally generated
funds and working capital credit lines.

DEBT SERVICE AND CAPITAL NEEDS

The Company's long-term indebtedness consists of the debt obligations of the
Company to BNY Financial Corporation ("BNY") and AIF-II, L.P., a Delaware
limited partnership and an affiliate of Apollo Advisors, L.P. ("AIF II"). On
January 29, 1998, the Company repaid in full all of its remaining debt
obligations to Heller Financial, Inc. ("Heller"). Such payment amounted to
$1,128,000, inclusive of accrued interest through the date of repayment.

o    On June 30, 1993, the Company entered into a Series A Junior Secured Note
     Agreement with BNY, pursuant to which BNY received a $7 million note,
     bearing interest at a rate of 7% per annum, with a final maturity date of
     November 3, 2002. BNY shares with AIF II a first lien on the stock of ECI.
     On September 12, 1997, the Company and BNY entered into an amendment of the
     BNY Note Agreement providing that (1) scheduled interest accruing under the
     BNY Note Agreement for the period February 1, 1996 through January 31, 1998
     was not and will not be paid in cash and instead shall be added to
     principal and shall be payable on November 3, 2002, (2) scheduled interest
     under the BNY Note Agreement accruing for the periods commencing February
     1, 1998 will be made in cash on quarterly payment dates commencing May 


                                      -16-

<PAGE>


     4, 1998 and (3) the principal on the BNY Note Agreement of $300,000
     otherwise due November 3, 1997 shall be rescheduled and paid quarterly in
     installments of $15,000 each on the last day of each calendar quarter
     commencing on December 31, 1997, with any remaining balance due on November
     3, 2002. The remaining principal of BNY's note is required to be paid in
     five annual installments, payable on November 3 of each year commencing in
     1998 as follows:

                        YEAR               AMOUNT
                        ----             ----------
                        1998             $  300,000
                        1999                500,000
                        2000                600,000
                        2001              1,100,000
                        2002              4,200,000
                    
     In addition, on November 3, 2002, the Company is obligated to pay BNY
     $1,042,000, representing the quarterly interest payments accruing for the
     period February 1, 1996 through January 31, 1998, which were not and will
     not be paid in cash and instead added to the principal of the BNY Note.

o    On June 30, 1993 the Company entered into a Series B Junior Secured Note
     Agreement with AIF-II, pursuant to which AIF-II received a $7.5 million
     note bearing interest at 13% per annum. AIF-II shares with BNY a first lien
     on the stock of ECI. On September 12, 1997, the Company and AIF-II entered
     into an amendment of the AIF-II Note Agreement providing that (1) scheduled
     interest accruing under the AIF-II Note Agreement for the period November
     1, 1995 through January 31, 1998 was not and will not be paid in cash and
     instead shall be added to principal and shall be payable on November 3,
     2002 and (2) scheduled interest under the AIF-II Note Agreement accruing
     for periods commencing February 1, 1998 will be made in cash on quarterly
     payment dates commencing May 4, 1998. Principal of AIF-II's note is
     required to be paid in two equal installments payable on November 3 in each
     of 2001 and 2002.

     In addition, on November 3, 2002, the Company is obligated to pay AIF-II
     $2,502,000, representing the quarterly interest payments accruing for the
     period November 1, 1995 through January 31, 1998, which were not and will
     not be paid in cash and instead added to the principal of the AIF-II Note.

BNY and AIF-II will also share in mandatory prepayments based upon 50% of
certain "excess cash flows" of the Company as defined in the Company's note
agreements with BNY and AIF-II.


                                      -17-

<PAGE>

RESULTS OF OPERATIONS

NET INCOME

The Company reported a net loss of $1,242,000, inclusive of an extraordinary
gain in the amount of $522,000 recorded on the early extinguishment of the New
Heller Note, which was paid off on January 29, 1998, for the three month period
ended March 31, 1998, compared to a net loss of $862,000 for the three month
period ended March 31, 1997. The decrease in profitability was primarily due to
reduced sales and margins at ECI which were the result of a poor fall selling
season at many retailers and specialty stores who had carryover inventory and
therefore reduced their spring season purchases of higher margin "Perry Ellis
America" outerwear offset by the continued strong performance of the Company's
own Members Only brand.

REVENUE

The Company's revenues increased from $14,447,000 during the three months ended
March 31, 1997 to $17,825,000 during the three months ended March 31, 1998. The
revenue increase was due to the inclusion of ECI Sportswear's revenues of
$6,883,000 in the current year offset by a decrease in ECI's revenues of
$3,505,000. ECI Sportswear acquired the assets of Davco on July 15, 1997. ECI's
revenues were impacted by a poor fall selling season at many retailers and
specialty stores who had carryover inventory and therefore reduced their spring
season purchases of "Perry Ellis America" lines offset by the continued strong
performance of the Company's own Members Only brand.

COST OF SALES

Costs of Sales for the three months ended March 31, 1998 as a percentage of
revenue was 69.7% compared to 67.7% for the three months ended March 31, 1997.
Cost of Sales were also impacted by a poor fall selling season at many retailers
and specialty stores who had carryover inventory and therefore reduced their
spring season purchases of higher margin "Perry Ellis America" business offset
by the continued strong performance of the Company's own Members Only brand
which historically is sold at lower margins.

SELLING AND ADMINISTRATIVE EXPENSES

Selling and Administrative expenses as a percentage of revenues for the three
month period ended March 31, 1998 were 35.9% compared to 35.1% for the three
period ended March 31, 1997. The increase for the three month period ended March
31, 1998 in Selling and Administrative expenses as a percentage of revenue was
predominantly due to the fixed nature of the Company's expense structure. The
Company will experience a higher Selling and Administrative expense percentage
in the first half of the year which will decrease in the second half of the year
due to the seasonality of the Company's business.


                                      -18-

<PAGE>

Selling and Administrative expenses for the three months ended March 31, 1998
were $6,402,000 compared to $5,064,000 for the three months ended March 31,
1997, an increase of $1,338,000 or 26.4%. The increase in Selling and
Administrative expenses was due to the inclusion of ECI Sportswear's Selling and
Administrative expenses of $1,889,000 since its acquisition of Davco on July 15,
1997, offsetting a decrease in Selling and Administrative expenses of $435,000
at ECI due to a decrease in "Perry Ellis America" sales which resulted in lower
payments on contractual advertising obligations and lower salesmans commissions.

INTEREST AND DEBT EXPENSE

Interest and debt expense for the three month period ended March 31, 1998
increased by $394,000 or 86.2% compared to the three month period ended March
31, 1997. This increase is due to the inclusion of new borrowings of ECI
Sportswear in 1998, since the acquisition of Davco on July 15, 1997 along with
an increase in interest expense at ECI due to increased borrowings against its
line of credit.

                           PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

NONE

ITEM 2. CHANGES IN SECURITIES

NONE

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

NONE

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

NONE

ITEM 5. OTHER INFORMATION

NONE

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits - Exhibit 27

(b) Reports on Form 8-K - NONE


                                      -19-


<PAGE>


                                   SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

                                               ARIS INDUSTRIES, INC.
                                               (Registrant)

Date: May 11, 1998                             By /s/ Paul Spector
                                                  -----------------------
                                                  Paul Spector,
                                                  Senior Vice President
                                                  Chief Financial Officer

                                               By /s/ Vincent F. Caputo
                                                  -----------------------
                                                  Vincent F. Caputo,
                                                  Vice President
                                                  Assistant Secretary and
                                                  Assistant Treasurer


                                      -20-