UNITED STATES SECURITIES AND EXCHANGE COMMISSION 
                            Washington, D.C. 20549 
 
 
                                   FORM 10-Q 
                                   --------- 
 
              QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF 
                     THE SECURITIES EXCHANGE ACT OF 1934 
 
                  FOR THE FIRST QUARTER ENDED JANUARY 30, 1999 
 
 
                          Commission File Number 0-934 
                          ---------------------------- 
 
 
                              B.B. WALKER COMPANY 
             ------------------------------------------------------ 
             (Exact name of registrant as specified in its charter) 
 
 
 
           North Carolina                                    56-0581797     
  -------------------------------                         ---------------- 
  (State or other jurisdiction of                         (I.R.S. Employer 
   incorporation or organization)                         Identification No.) 
 
 
  414 East Dixie Drive, Asheboro, NC                            27203     
-----------------------------------------------               ---------- 
(Address of principal executive offices)                      (Zip Code) 
 
 
Registrant's telephone number, including area code:        (336) 625-1380 
                                                           -------------- 
 
 
 
Indicate by check mark whether the registrant (1) has filed all reports 
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 
1934 during the preceding 12 months (or for such shorter period that the 
registrant was required to file such reports) and (2) has been subject to such 
filing requirements for the past 90 days.  Yes  X     No 
                                               ---       --- 
 
On March 8, 1999, 1,725,954 shares of the Registrant's voting common stock 
with a par value of $1.00 per share were outstanding. 
 
 
                                      Cover



                              B.B. WALKER COMPANY
                          CONSOLIDATED BALANCE SHEETS
                                (In thousands)
 
 
                                                (Unaudited)       (Audited)
                                                January 30,       October 31, 
               Assets                              1999              1998
               ------                           -----------       ----------- 
 
Cash                                            $        1        $        1  
Accounts receivable, less allowance 
  for doubtful accounts of $637 in 
  1999 and $557 in 1998                              5,598             7,157 
Inventories                                          9,096             9,660 
Prepaid expenses                                       364               446 
Deferred income tax benefit, current                 1,050             1,050 
                                                   -------           ------- 
    Total current assets                            16,109            18,314 

Property, plant and equipment, net of 
  accumulated depreciation and amortization 
  of $6,570 in 1999 and $6,523 in 1998               1,606             1,622 
Other assets                                           149               144 
                                                   -------           ------- 
                                                $   17,864        $   20,080 
                                                   =======           ======= 

                                                                  (Continued)
                                       1


                              B.B. WALKER COMPANY 
                    CONSOLIDATED BALANCE SHEETS, Continued 
                                (In thousands) 
 
 
                                                (Unaudited)       (Audited)
                                                January 30,       October 31, 
  Liabilities and Shareholders' Equity             1999              1998
  ------------------------------------          -----------       ----------- 
 
Borrowings under finance agreement              $    5,740        $    6,885 
Current portion of long-term obligations             2,483             2,566 
Accounts payable, trade                              2,896             3,536 
Accrued salaries, wages and bonuses                    176               367 
Other accounts payable and accrued liabilities         630               555 
Income taxes payable                                   193               193 
                                                   -------           ------- 
    Total current liabilities                       12,118            14,102 
                                                   -------           ------- 

Long-term obligations                                1,293             1,303 
Minority interests in consolidated subsidiary           33                33 

Shareholders' equity:
  7% cumulative preferred stock, $100 par value,
    1,150 shares authorized, 828 shares issued
    and outstanding in 1999 and 1998                    83                83 
  Common stock, $1 par value, 6,000,000 shares
    authorized, 1,725,954 shares in 1999 and
    1,720,954 in 1998 issued and outstanding         1,726             1,721 
  Capital in excess of par value                     2,716             2,717 
  Retained earnings (deficit)                          (32)              198 
  Shareholders' loans                                  (73)              (77)
                                                   -------           ------- 
    Total shareholders' equity                       4,420             4,642 
                                                   -------           ------- 
                                                $   17,864        $   20,080 
                                                   =======           ======= 
 
 
The accompanying notes to consolidated financial statements are an integral 
part of these financial statements.


                                       2



                              B.B. WALKER COMPANY
                        CONSOLIDATED STATEMENTS OF LOSS
                     (In thousands, except per share data)
 
                                                            (Unaudited) 
                                                           First Quarter 
                                                               Ended 
                                                     ------------------------ 
                                                     January 30,   January 31,
                                                        1999          1998
                                                     -----------   ----------- 

Net sales                                            $    6,123    $    7,732 
Interest and other income                                   117           131 
                                                        -------       ------- 
  Total revenues                                          6,240         7,863 
                                                        -------       ------- 

Cost of products sold                                     4,511         5,792 
Selling and administrative expenses                       1,677         1,901 
Depreciation and amortization                                47            74 
Interest expense                                            233           276 
                                                        -------       ------- 
  Total costs and expenses                                6,468         8,043 
                                                        -------       ------- 
Loss before income taxes and
  minority interest                                        (228)         (180)
Benefit from income taxes                                    -             -  
Minority interest                                            (1)           (1)
                                                        -------       ------- 
  Net loss                                                 (229)         (181)

Retained earnings, beginning of quarter                     198           129 
Dividends on preferred stock                                 (1)           (1)
                                                        -------       ------- 
Retained earnings, end of quarter                    $      (32)   $      (53)
                                                        =======       ======= 

Net loss per share:
  Basic                                              $     (.13)   $     (.11)
                                                        =======       ======= 
  Diluted                                            $     (.13)   $     (.10)
                                                        =======       =======
Weighted average common shares outstanding:
  Basic                                                   1,722         1,727 
                                                        =======       ======= 
  Diluted                                                 1,771         1,738 
                                                        =======       ======= 


The accompanying notes to consolidated financial statements are an integral 
part of these financial statements.


                                       3



                              B.B. WALKER COMPANY
                      CONSOLIDATED CASH FLOWS STATEMENTS
                                (In thousands)
                                                            (Unaudited) 
                                                           First Quarter 
                                                               Ended 
                                                     ------------------------ 
                                                     January 30,   January 31,
                                                        1999          1998
                                                     -----------   ----------- 
Cash Flows From Operating Activities:
  Net loss                                           $     (229)   $     (181) 
  Adjustments to reconcile net loss to net 
   cash provided by operating activities:
    Depreciation and amortization                            47            74 
    (Increase) decrease in:
      Accounts receivable, net                            1,559         1,548 
      Inventories                                           564           376 
      Prepaid expenses                                       82           180 
      Other assets                                           (5)           (3)
    Increase (decrease) in:
      Accounts payable, trade                              (640)         (832)
      Accrued salaries, wages and bonuses                  (191)         (218)
      Other accounts payable and accrued liabilities         75           257 
                                                        -------       ------- 
  Net cash provided by operating activities               1,262         1,201 
                                                        -------       ------- 

Cash Flows From Investing Activities:
  Capital expenditures                                      (31)         (111) 
                                                        -------       ------- 
  Net cash used for 
    investing activities                                    (31)         (111) 
                                                        -------       ------- 
Cash Flows From Financing Activities:
  Net borrowing under finance agreement                  (1,145)       (3,086)
  Proceeds from issuance of long-term obligations            10             6 
  Payment on long-term obligations                         (103)         (194)
  Proceeds from issuance of common stock                      4            -  
  Loans to shareholders, net of repayments                    4             4 
  Dividends paid on 7% cumulative preferred stock            (1)           (1)
                                                        -------       ------- 
  Net cash used for financing activities                 (1,231)       (1,090)
                                                        -------       ------- 
 
Net change in cash                                         -             -   
Cash at beginning of year                                     1             1 
                                                        -------       ------- 
Cash at end of quarter                               $        1    $        1 
                                                        =======       ======= 

The accompanying notes to consolidated financial statements are an integral 
part of these financial statements.


                                       4



                              B.B. WALKER COMPANY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 1 
------ 
A summary of the Company's significant accounting policies is presented on  
page 9 of its 1998 Annual Report to Shareholders.  Users of financial 
information presented for interim periods are encouraged to refer to the 
footnotes contained in the Annual Report to Shareholders when reviewing interim 
financial results.

In the opinion of management, the accompanying unaudited consolidated financial 
statements contain all adjustments necessary for a fair presentation of the 
financial results of B.B. Walker Company and Subsidiary (the "Company") for the 
interim periods included.  All such adjustments are of a normal recurring 
nature.  The results of operations for the interim periods shown in this report 
are not necessarily indicative of the results to be expected for the fiscal 
year.

The Company's operations are reported on a fifty-two, fifty-three week fiscal 
year that ends on the Saturday closest to October 31.  The results for the 
first quarters ended January 30, 1999 and January 31, 1998 each include 
thirteen weeks of operations.



Note 2 
------ 
Basic earnings per share (EPS) is computed by dividing income available to 
common shareholders by the weighted-average number of common shares outstanding 
for the year.  In arriving at income available to common shareholders, 
preferred stock dividends of $1,449 were deducted in each quarter presented.  
Diluted EPS reflects the potential dilution that could occur if dilutive 
securities and other contracts to issue common stock were exercised or 
converted into common stock or resulted in the issuance of common stock that 
then shared in the earnings of the Company.



Note 3 
------ 
Statement of Financial Accounting Standards ("FAS") No. 130, "Reporting 
Comprehensive Income" requires that certain items such as foreign currency 
translation adjustments, unrealized gains and losses on certain investments in 
debt and equity securities, minimum pension liability adjustments, and unearned 
compensation expense related to stock issuances to employees be presented as 
separate components of stockholders' equity.  FAS 130 defines these as items of 
other comprehensive income and as such must be reported in a financial 
statement that is displayed with the same prominence as other financial 
statements.  At January 30, 1999, the Company does not have any items of 
comprehensive income to 
report.


                                       5



                              B.B. WALKER COMPANY
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued
 
 
Note 4 
------ 
Long-term obligations consist of the following amounts (in thousands):

                                               (Unaudited)       (Audited)
                                               January 30,       October 31, 
                                                  1999              1998 
                                               -----------       ----------- 
Notes payable to banks                         $    2,013        $    2,099 
Notes payable to governmental authorities             556               567 
Promissory notes payable to shareholders            1,207             1,203 
                                                  -------           ------- 
                                                    3,776             3,869 
Less portion payable within one year                2,483             2,566 
                                                  -------           ------- 
                                               $    1,293        $    1,303 
                                                  =======           ======= 



Note 5 
------ 
Inventories are composed of the following amounts (in thousands):

                                               (Unaudited)       (Audited)
                                               January 30,       October 31, 
                                                  1999              1998 
                                               -----------       ----------- 

     Finished goods                            $    5,567        $    5,167 
     Work in process                                  707               945 
     Raw materials and supplies                     2,822             3,548 
                                                  -------           ------- 
                                               $    9,096        $    9,660 
                                                  =======           ======= 



Note 6 
------ 
In January 1999, the Company entered into a contract to sell its manufacturing
facility in Asheboro, North Carolina, along with an adjacent piece of property.
On February 26, 1999, this contract was cancelled by the purchaser as permitted
under provisions in the contract. 


                                       6



                              B.B. WALKER COMPANY
         MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS 
                            AND FINANCIAL CONDITION 


RESULTS OF OPERATIONS 
--------------------- 
The following summarizes the results of operations for the Company for the 
first quarter ended January 31, 1998 and February 1, 1997:

                                                        Three 
                                                    Months Ended 
                                              ------------------------- 
                                              January 30,   January 31, 
                                                 1999          1998 
                                              -----------   ----------- 
      Net sales                                   100.0%        100.0% 
      Cost of products sold                        73.6%         74.9% 
                                                 -------       ------- 
        Gross margin                               26.4%         25.1% 

      Selling and administrative expenses          27.4%         24.6% 
      Depreciation and amortization                  .8%          1.0% 
      Interest expense                              3.8%          3.5% 
      Interest and other income                    (1.9%)        (1.7%)
                                                 -------       ------- 
        Loss before income taxes
          and minority interest                    (3.7%)        (2.3%)

      Benefit from income taxes                      -             -   
      Minority interest                              -             -   
                                                 -------       ------- 
        Net loss                                   (3.7%)        (2.3%)
                                                 =======       ======= 



FIRST QUARTER 1999 COMPARED TO FIRST QUARTER 1998
-------------------------------------------------

Net Sales
---------
Net sales for the first quarter of 1999 were $6,123,000, or 20.8% lower than 
net sales of $7,732,000 in the first quarter of 1998.  The Company's sales 
include sales of footwear manufactured and wholesaled by the Company and sales 
from the Company's retail outlets.  Footwear manufactured and wholesaled by 
the Company, which includes branded, private label and institutional sales, 
comprised 89.1% of net sales in the first quarter of 1999 and 92.6% of net 
sales in the first quarter of 1998.  The remaining 10.9% and 7.4% of net sales 
in 1999 and 1998, respectively, were sales from the Company's retail outlets. 

The decrease in net sales can be attributed to two factors.  First, the 
Company's western branded business continues to be impacted by a weak western 
retail sector.  Historically, western footwear has proven to be a cyclical 
business.  Demand reached a peak in 1993 and 1994 but has declined during the 
past four years.  With the repositioning of its product lines in recent years, 
the Company's sales are more dependent on its western branded business, whose 
shipments in the first quarter of 1999 were $638,000, or 16.1%, less than the 
first quarter of 1998.  Second, shipments of work/outdoor footwear for the 
first quarter of 1999 decreased $890,000, or 28.4%, from the first quarter of 
1998.  The Company's largest customer, a major discount retailer, showed a 9.8% 
decrease in shipments from the first quarter of 1998 compared to the same 
period in 1999, due to an inventory adjustment period which caused a delay in 
orders being placed in early 1999. 


                                        7



                              B.B. WALKER COMPANY
         MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS 
                       AND FINANCIAL CONDITION, Continued 


Sales of the Company's branded footwear in the first quarter of 1999 were down 
$402,000, or 9.3%, from 1998's first quarter because of the reasons discussed 
above.  Branded pairs shipped were down 6,484, or 8.1%, in the first quarter 
while price per pair was down only 1.4%.  The slight decrease in price per pair 
can be attributed to product mix.  Nearly 80% of the Company's branded net 
sales are coming from its western styles that carry a higher price per pair 
than its work/outdoor styles.  

Private label sales in the first quarter of 1999 were down $1,042,000, or 
39.9%, from the first quarter of 1998.  The decrease can be attributed to 
weaker work/outdoor private label business.  Much of this business is 
dependent on the timing of orders for several large customers which did not 
keep pace with the prior year.  Pairs shipped were down 16,164, or 23.8%, 
while the price per pair was down 26.8%.  The primary reason for this decrease 
in price per pair is due to a significant private label order which required 
only the finishing procedure by the Company; therefore, the realized price per 
pair was lower than usual.

Sales to institutional customers in the first quarter of 1999 were down 
$151,000, or 7.8%, from the first quarter of 1998.  Much of this business is 
solicited through a formal bidding process with governmental entities, and the 
results of this division are impacted by the Company's success in bidding on 
new business.

Retail sales decreased $45,000, or 7.8%, from the first quarter of the prior 
year.  The two retail outlets, one in Asheboro, NC and one in Lancaster, PA, 
continue to experience increased competition from major discount retailers 
surrounding their locations. 


Gross Margin
------------

The Company's gross margin as a percentage of sales was 26.3% for the first 
three months of 1999 and 25.1% for the first three months of 1998.  The 
Company's gross margin showed a slight increase from the prior year primarily 
because of the sources from which net sales were derived.  For the first 
quarter of 1999, 63.8% of net sales came from branded sales and 25.7% came 
from private label sales.  For the comparable period in 1998, 54.3% of net 
sales were branded sales and 31.9% were private label sales.  Since branded 
sales carry higher margins, an overall increase was experienced.  The 
anufacturing division also posted slightly improved operating results due to 
production efficiencies resulting from the welt and cement construction 
footwear being in separate facilities since late in fiscal year 1998.  The 
Company's gross margin percentage continues to be impacted by competitive 
pressure at the retail level that requires that the Company remain 
competitive in the pricing and terms offered.


Selling and Administrative Expenses
-----------------------------------

Selling and administrative expenses were $1,677,000 for the first quarter of 
1999 as compared to $1,901,000 for the first quarter of 1998, an decrease of 
$224,000, or 11.8%.  This improvement is due to management's continuing 
emphasis of controlling costs and improving operations in the selling and 
administrative areas.

                                          8


                              B.B. WALKER COMPANY
         MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS 
                       AND FINANCIAL CONDITION, Continued 


Interest Expense
----------------

Interest expense in the first quarter of 1999 was $233,000, or $43,000 lower 
than interest expense of $276,000 for the first quarter of 1998.  This 15.6%
decrease in interest expense for the three month period can be attributed to a
1.0% drop in the interest rate and a lower average balance on outstanding debt.
Average outstanding advances under the revolving finance agreement were 
approximately $484,000, or 7.1%, lower in the first quarter of 1999 than in 
1998.  Other fees incurred for this agreement were approximately the same rate 
for each year.  Other long-term debt carried lower balances in 1999 when 
compared to 1998 as the Company continues to amortize the debt according to 
each issue's respective terms.  No new material debt was added during the 
first quarter.


Depreciation and Amortization
-----------------------------

Depreciation and amortization in the first quarter of 1999 was $47,000, or 
$27,000 less than 1998 expenses of $74,000.  With minimal amounts invested in 
fixed assets in recent years, depreciation charges on fixed assets that are 
becoming fully depreciated are not being replaced, resulting in lower 
depreciation expense.  


Benefit From Income Taxes
-------------------------

For the first quarter of both 1999 and 1998, the Company recorded no benefit 
from income taxes.  The Company evaluated the valuation allowance reserved 
against its deferred income tax asset at the end of the first quarter and 
determined that the net deferred income tax asset was appropriately recorded 
at its net realizable value.  


Net Income
----------

The Company reported a net loss of $229,000 in the first quarter of 1999 and 
$181,000 in the first quarter of 1998.  The 26.5% increase in net loss is 
attributable to the 26.3% decrease in net sales. 


                                          9


                              B.B. WALKER COMPANY
         MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS 
                       AND FINANCIAL CONDITION, Continued 


LIQUIDITY AND CAPITAL RESOURCES
-------------------------------

Historically, the Company has funded substantially all of its working capital 
and capital expenditure requirements through borrowings under its finance 
agreement and other indebtedness.  The revolving finance agreement provides 
flexibility to the Company as the availability of funds fluctuates with the 
seasonal needs of the Company.  Generally, the Company's working capital needs 
are highest in the fourth fiscal quarter and lowest in the first fiscal 
quarter.  With its revolving finance agreement, the Company finances its 
accounts receivable and inventories, paying interest at a variable rate (prime 
plus 1.50%, or 9.25%, at January 30, 1999).  The Company had outstanding 
advances of $5,740,000 at January 30, 1999 and an additional $1,251,000 
available under the agreement.

During the first quarter of 1999, the Company generated $1,262,000 of cash from 
operations which was used to reduce the advances under the revolving finance 
agreement by $1,145,000.  The Company continues to rely on the revolving 
finance agreement to provide working capital and management anticipates that 
the revolving finance agreement will continue to provide the necessary 
liquidity to fund its daily operations going forward.

Under the Company's financing agreement with the bank, the amount available to 
be drawn is determined by a formula based on certain percentages of eligible 
accounts receivable and inventories.  The credit line available under the 
agreement is a maximum of $8,000,000.  In addition, the sublimit for inventory, 
the maximum advances that can be taken against inventory under the revolving 
credit agreement, is $4,000,000.  The Company must also meet certain 
restrictive financial covenants that were amended effective December 29, 
1998 and for periods thereafter.  The covenants require the satisfaction of 
certain financial tests and the maintenance of certain financial ratios as 
defined in the agreement.  At January 30, 1999, the Company was in compliance 
with its restrictive financial covenants.

In addition to the revolving credit facility, the financing agreement also 
provided a $3,000,000 term loan that was used to repay an existing mortgage 
note payable to a bank that carried a balance of approximately $1,812,000.  
The term loan bears interest at the bank's prime rate plus 1.50% (9.25% at 
January 30, 1999).

All advances under the revolving credit facility and the term loan are secured 
by all accounts receivable, inventories, machinery and equipment of the 
Company.  In addition, the bank has a first lien on the Asheboro land and 
facilities and a subordinated lien on the Somerset facilities.

The Company made only minimal capital expenditures during the past three years.
The Company made significant upgrades to its equipment and facilities in 1993 
and 1994.  Because of cash flow considerations and restrictions under the 
finance agreement, the Company has only been making capital expenditures to 
maintain current levels of operations during the past four years.  Funding for 
capital expenditures, other than the acquisition of the Somerset, Pennsylvania 
facility in July 1994, has primarily come from the available balance on the 
finance agreement.

Net working capital, which consists primarily of accounts receivable and 
inventories less current liabilities, was $3,991,000 at January 30, 1999 and 
$7,157,000 at October 31, 1998.  The ratio of current assets to current 
liabilities increased to 1.54 to 1 at January 30, 1999 compared to 1.46 to 1 
at October 31, 1998.  

                                        10


                              B.B. WALKER COMPANY
         MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS 
                       AND FINANCIAL CONDITION, Continued 


FINANCIAL CONDITION
-------------------

Accounts Receivable
-------------------

Accounts receivable were $5,598,000 at January 30, 1999 compared to $7,157,000 
at October 31, 1998, a decrease of $1,559,000.  Trade receivables are 
historically at their highest point at the end of the fourth quarter because of 
the heavy sales volume related to Christmas buying by retailers.  This 21.8% 
decrease in accounts receivable is also related to the 26.3% decrease in net 
sales.


Inventories
-----------

Inventories were $9,096,000 at January 30, 1999, a decrease of $564,000, or 
5.8%, from the inventories held at October 31, 1998 of $9,660,000.  Of the 
decrease, approximately $238,000 is in work in process and $726,000 is in raw 
materials.  These were offset by an increase of $400,000 in finished goods.  
The Company continues to focus on improving turns in inventory and improving 
the efficiency of raw material procurement.


Borrowings Under Finance Agreement
----------------------------------

The balance outstanding under the finance agreement was $5,740,000 at January 
30, 1999 compared to $6,885,000 at October 31, 1998.  The decrease can be 
attributed to the cash applied against the outstanding balance from collections 
of accounts receivable which were down $1,559,000 in the first quarter of 1999 
and better management of inventories.


Potential Sale of Property
--------------------------

Late in the fourth quarter of 1998, the Company received an attractive offer 
to sell all of its approximately 22.3 acres of real property in Asheboro, 
North Carolina.  This land is in one of the prime commercial sections of 
Randolph County.  The Company entered into a Contract for Purchase and Sale 
of Real Property Located in Asheboro, North Carolina, dated as of January 28, 
1999.  Under this contract, the purchaser had until February 26, 1999 to cancel 
the contract.  On February 26, 1999, the contract was cancelled with the 
purchaser having no further obligation to the Company.  Immediately thereafter, 
the Company began negotiating with several other interested parties who had 
become aware of the Company's intentions to sell the Asheboro property when the 
initial contract became public.  It is possible that a new contract will be 
entered into in the near future.  However, there can be no assurances that the 
terms of a new contract will be agreed to or that, even if another contract is 
entered into, a sale of the Asheboro property will be consummated.

                                        11


                              B.B. WALKER COMPANY
         MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS 
                       AND FINANCIAL CONDITION, Continued 


Readiness for Year 2000 Compliance
----------------------------------

The Company has initiated a program to minimize the risk of potential 
disruption from the "Year 2000 ('Y2K') problem."  This problem is a result of 
computer programs having been written using two digits (rather than four) to
define the applicable year.  Any information technology ("IT") systems that
have time-sensitive software may recognize a date using "00" as the year 1900 
rather than the year 2000, which could result in miscalculations and system 
failures.  The problem also extends to "non-IT" systems; that is, operating 
and control systems that rely on embedded chip systems.  In addition, like 
every other business enterprise, the Company is at risk from Y2K failures on 
the part of its major business counterparts, including suppliers, 
distributors, and manufacturers, as well as potential failures in public and 
private infrastructure services, including electricity, water, gas, 
transportation, and communications.

The Company began developing a plan in November 1997 to resolve the Y2K issues 
that are reasonably within its control.  These efforts are being coordinated 
through the Company's data processing department and chaired by the information 
systems programming manager ("ISPM").  With respect to the Company's Y2K 
efforts, the ISPM reports periodically to the Company's president, who in turn 
updates the Audit Committee of the Board of Directors. 

In January 1998, the ISPM completed an identification of those IT systems which 
would require detailed program changes to be Y2K compliant.  An employee 
programmer already familiar with the Company's computer system has been 
assigned full-time to modify those identified programs.  Program changes 
and testing are made in a test directory specifically created for the Y2K 
modifications so that there are no conflicts with live data.  When testing is 
completed for a system, files are then converted, and modified programs are 
copied to live directories on a weekend when no users are on the system.  The 
Company's current timetable anticipates completion of all conversions, 
necessary testing, and full implementation by June 30, 1999.  At this time, 
the Company has not deemed it necessary to develop contingency plans for any 
of the applications being converted; however, the Company will continue to 
assess this and will develop contingency plans for any applications not 
converted and operating by June 30, 1999.

With respect to Electronic Data Interchange ("EDI") applications, a Company 
manager with extensive computer experience is assessing the Company's impact 
from four customers who transmit orders via EDI.  All but three of these 
customers utilize a third-party EDI service bureau, while the fourth one (the 
Company's largest customer) is expected to be changed from being an internal 
EDI user to an external user by June 30, 1999.  No significant EDI 
transmission problems are anticipated.

With regard to non-IT systems, the Company's phone and security systems are 
both Y2K compliant.  The Company is in the process of assessing personal 
computers and manufacturing machines that are not Y2K compliant, especially 
those with programs that involve stitching patterns on western boots.  Major 
suppliers to the Company have been contacted by questionnaire, and the 
Company has received confirmations of either Y2K compliance or a timetable 
to be compliant from such suppliers.  The Company has also contacted its 
major customers by questionnaire to assess their status with regard to the 
Y2K issue.  Contingency plans will be developed for any significant suppliers 
or customers that are not Y2K compliant by June 30, 1999, or earlier if the 
Company becomes aware that such entities may not be Y2K compliant in a timely 
manner.

                                        12

                              B.B. WALKER COMPANY
         MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS 
                       AND FINANCIAL CONDITION, Continued 


It is important to note that the description of the Company's efforts 
necessarily involves estimates and projections with respect to activities 
required in the future.  The required code changes, testing, and implementation 
necessary to address the Y2K issue are expected to cost approximately $100,000, 
and the Company has incurred approximately $60,000 through January 30, 1999.  
The Company estimates that it is approximately 65% complete with the efforts 
required to be Y2K compliant.  These estimates and projections are subject to 
change as work continues.

Even though the Company's Y2K plan should adequately address the Y2K issue, 
there can be no assurance that unforeseen difficulties will not arise.  If the 
Company does not identify and fix all Y2K problems, or if a major supplier or 
customer is unable to adequately address its Y2K issue, the Company's results 
of operations or financial condition could be materially impacted.


New Accounting Standards
------------------------

Statement of Financial Accounting Standards ("FAS") No. 130, "Reporting 
Comprehensive Income" requires that certain items such as foreign currency 
translation adjustments, unrealized gains and losses on certain investments in 
debt and equity securities, minimum pension liability adjustments, and unearned 
compensation expense related to stock issuances to employees be presented as 
separate components of stockholders' equity.  FAS 130 defines these as items of 
other comprehensive income and as such must be reported in a financial 
statement that is displayed with the same prominence as other financial 
statements.  At January 30, 1999, the Company does not have any items of 
comprehensive income to report.

In June 1997, the FASB issued FAS 131, "Disclosures About Segments of an 
Enterprise and Related Information".  This Statement changes the way companies 
report information about segments of their business in their annual financial 
statements and require companies to report selected segment information in 
their quarterly reports issued to shareholders.  It also requires entity-wide 
disclosures about the products and services an entity provides, the material 
countries in which it holds assets and reports revenues, and its major 
customers.  The Statement also requires companies to disclose segment data 
based on how management makes decisions about allocating resources to segments 
and measuring their performance.  FAS 131 is effective for the Company in 
fiscal year 1999, but as permitted, this Statement need not be applied to 
interim financial statements in the initial year of its application. 


Forward-Looking Statements
--------------------------

The foregoing discussion contains some forward-looking statements about the 
Company's financial condition and results of operations, which are subject to 
certain risks and uncertainties that could cause actual results to differ 
materially from those reflected in the forward-looking statements.  Readers are 
cautioned not to place undue reliance on these forward-looking statements, 
which reflect management's judgment only as of the date hereof.  The Company 
undertakes no obligation to publicly revise these forward-looking statements to 
reflect events and circumstances that arise after the date hereof.

Factors that might cause actual results to differ materially from these 
forward-looking statements include (1) the effects of general economic 
conditions, (2) the impact of competitive products and pricing in the footwear 
industry, (3) failure to achieve anticipated sales results, (4) management's 
ability to accurately predict the effect of cost reductions, (5) management's 
ability to accurately predict the adequacy of the Company's financing 
arrangement to meet its working capital and capital expenditure requirements, 
and (6) failure to enter into a contract for the sale of the Asheboro, North 
Carolina property and if entered into, the consummation of the transaction 
provided for therein.

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Part II.   OTHER INFORMATION 
           -----------------

Item 6.    Exhibits and Reports on Form 8-K

  (a)      Exhibits Filed:

           (27)   Financial Data Schedule for the first quarter ended 
                  January 30, 1999

  (b)      Reports on Form 8-K:

           NONE.




Signatures 
---------- 

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


                              B.B. WALKER COMPANY


     Date:  March 10, 1999    KENT T. ANDERSON 
                              ---------------- 
                              Chairman of the Board, Chief 
                                Executive Officer and President 




     Date:  March 10, 1999    CAREY M. DURHAM 
                              --------------- 
                              Chief Financial Officer 


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