<PAGE>
               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 SECOND QUARTER ENDED MAY 2, 1998 
 
 
                          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 June 15, 1998, 1,720,954 shares of the Registrant's voting common stock 
with a par value of $1.00 per share were outstanding. 
 
 
 
 
 
 
 
<PAGE> 
                              B.B. WALKER COMPANY
                          CONSOLIDATED BALANCE SHEETS
                                (In thousands)
 
 
                                               (Unaudited)
                                                  May 2,          November 1, 
               Assets                              1998              1997
               ------                           -----------       ----------- 
 
Cash                                            $        1        $        1  
Accounts receivable, less allowance 
  for doubtful accounts of $545 in 
  1998 and $503 in 1997                              8,065             9,084 
Inventories                                          9,488             9,533 
Prepaid expenses                                       150               413 
Deferred income tax benefit                            237               237 
                                                   -------           ------- 
    Total current assets                            17,941            19,268 

Property, plant and equipment, net of 
  accumulated depreciation and amortization 
  of $6,393 in 1998 and $6,256 in 1997               1,727             1,750 
Other assets                                           142               156 
                                                   -------           ------- 
                                                $   19,810        $   21,174 
                                                   =======           ======= 



























                                       1
                                                                  (Continued)
<PAGE> 
                              B.B. WALKER COMPANY 
                    CONSOLIDATED BALANCE SHEETS, Continued 
                                (In thousands) 
 
 
                                               (Unaudited)
                                                  May 2,          November 1, 
  Liabilities and Shareholders' Equity             1998              1997
  ------------------------------------          -----------       ----------- 
 
Borrowings under finance agreement              $    6,910        $    7,364 
Accounts payable, trade                              3,235             3,937 
Accrued salaries, wages and bonuses                    470               468 
Other accounts payable and accrued liabilities         701               489 
Current portion of long-term obligations               882             1,087 
Income taxes payable                                   192                23 
                                                   -------           ------- 
    Total current liabilities                       12,390            13,368 
                                                   -------           ------- 

Long-term obligations                                3,155             3,216 
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 1998 and 1997                    83                83 
  Common stock, $1 par value, 6,000,000 shares
    authorized, 1,720,954 shares in 1998 and 
    1,726,534 shares in 1997 issued and 
    outstanding                                      1,721             1,727 
  Capital in excess of par value                     2,717             2,724 
  Retained earnings (deficit)                         (205)              129 
  Shareholders' loans                                  (84)             (106)
                                                   -------           ------- 
    Total shareholders' equity                       4,232             4,557 
                                                   -------           ------- 
                                                $   19,810        $   21,174 
                                                   =======           ======= 
 
 
 
 
 
 
 
 
 
 
 
The accompanying notes to consolidated financial statements are an integral 
part of these financial statements.


                                       2
<PAGE>
                       B.B. WALKER COMPANY AND SUBSIDIARY 
                        CONSOLIDATED STATEMENTS OF LOSS 
                      (In Thousands, Except Per Share Data) 
<TABLE>
<CAPTION>
                                                           (Unaudited)                         (Unaudited)  
                                                       Second Quarter Ended                 Six Months Ended
                                                    --------------------------         --------------------------
                                                       May 2,         May 3,              May 2,         May 3, 
                                                        1998           1997                1998           1997   
                                                    -----------    -----------         -----------    -----------
<S>                                                 <C>            <C>                 <C>            <C>
Net sales                                           $    7,779     $    8,099          $   15,511     $   16,388 
Interest and other income                                   53             15                 184             47 
                                                    -----------    -----------         -----------    -----------
    Total revenues                                       7,832          8,114              15,695         16,435 
                                                    -----------    -----------         -----------    -----------
 
Cost of products sold                                    5,730          6,001              11,522         12,182 
Selling and administrative expenses                      1,922          1,722               3,823          3,602 
Depreciation and amortization                               65            114                 139            239 
Interest expense                                           265            294                 541            654 
                                                    -----------    -----------         -----------    -----------
    Total costs and expenses                             7,982          8,131              16,025         16,677 
                                                    -----------    -----------         -----------    -----------
Loss before income taxes and 
  minority interest                                       (150)           (17)               (330)          (242)
Provision for (benefit from) income taxes                  -               10                 -              (80)
Minority interest                                          -              -                     1              1 
                                                    -----------    -----------         -----------    -----------
    Net loss                                              (150)           (27)               (331)          (163)
 
Retained earnings (deficit) at beginning of period         (53)           (26)                129            111 
Dividends on preferred stock                                (2)            (2)                 (3)            (3)
                                                    -----------    -----------         -----------    -----------
Retained earnings (deficit) at end of period        $     (205)    $      (55)         $     (205)    $      (55)
                                                    ===========    ===========         ===========    ===========
 
Net loss per share: 
 
      Primary                                       $     (.09)    $     (.02)         $     (.19)    $     (.10)
                                                    ===========    ===========         ===========    ===========
      Fully diluted                                 $     (.09)    $     (.02)         $     (.19)    $     (.10)
                                                    ===========    ===========         ===========    ===========
 
Weighted average common shares outstanding:
 
      Primary                                            1,726          1,727               1,726          1,727 
                                                    ===========    ===========         ===========    ===========
      Fully diluted                                      1,735          1,732               1,738          1,730 
                                                    ===========    ===========         ===========    ===========
</TABLE>
The accompanying notes to consolidated financial statements are an integral 
part of these financial statements.
 
 
 
                                       3
<PAGE> 
                              B.B. WALKER COMPANY
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                (In thousands)
                                                            (Unaudited) 
                                                            Six Months 
                                                               Ended 
                                                     ------------------------ 
                                                        May 2,        May 3,
                                                         1998          1997
                                                     -----------   ----------- 
Cash Flows From Operating Activities:
  Net loss                                           $     (331)   $     (163) 
  Adjustments to reconcile net loss to net 
   cash provided by operating activities:
    Depreciation and amortization                           139           239 
    Gain on sale of property, plant and equipment            (3)          (26)
    Deferred income taxes                                   -             150 
    (Increase) decrease in:
     Accounts receivable, net                             1,019         2,825 
     Inventories                                             45         2,310 
     Prepaid expenses                                       263           191 
     Other assets                                            14            10 
    Increase (decrease) in:
     Accounts payable, trade                               (702)       (1,338)
     Accrued salaries, wages and bonuses                      2          (326)
     Other accounts payable and accrued liabilities         212           (86) 
     Income taxes payable                                   169           833 
                                                        -------       ------- 
  Net cash provided by operating activities                 827         4,619 
                                                        -------       ------- 
Cash Flows From Investing Activities:
  Capital expenditures                                     (116)          -   
  Proceeds from disposal of property, 
    plant and equipment                                       3            26 
                                                        -------       ------- 
  Net cash provided by (used for) 
    investing activities                                   (113)           26
                                                        -------       ------- 
Cash Flows From Financing Activities:
  Net borrowing under finance agreement                    (454)       (4,312)
  Proceeds from issuance of long-term obligations            37            66 
  Payment on long-term obligations                         (303)         (405)
  Loans to shareholders, net of repayments                    9             9 
  Dividends paid on 7% cumulative preferred stock            (3)           (3)
                                                        -------       ------- 
  Net cash used for financing activities                   (714)       (4,645)
                                                        -------       ------- 
 
Net change in cash                                         -             -   
Cash at beginning of year                                     1             1 
                                                        -------       ------- 
Cash at end of second quarter                        $        1    $        1 
                                                        =======       ======= 

The accompanying notes to consolidated financial statements are an integral 
part of these financial statements.
                                       4
<PAGE> 
                              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 1997 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 six months ended May 2, 1998 and May 3, 1997 each include twenty-six 
weeks of operations.  The second quarters for 1998 and 1997 each include 
thirteen weeks of operations. 
 
 
Note 2 
------ 
The Company has adopted the provisions of the Statement of Financial 
Accounting Standards No. 128, Earnings Per Share (SFAS No. 128) effective 
January 31, 1998.  SFAS No. 128 requires the presentation of basic and diluted 
earnings per share.  Basic EPS is computed by dividing income available to 
common shareholders by the weighted average number of common shares 
outstanding during the period.  Diluted earnings per share is computed giving 
effect to all dilutive potential common shares that were outstanding during 
the period.  Dilutive potential common shares consist of the incremental 
common shares issuable upon exercise of stock options.  All prior period 
earnings per share amounts have been restated to comply with SFAS No. 128.

In accordance with the disclosure requirements of SFAS No. 128, a 
reconciliation of the numerator and denominator of basic and diluted earnings 
per share for the second quarters and six months ended May 2, 1998 and May 3, 
1997, respectively, is provided as follows (amounts in thousands, except share 
amounts): 
<TABLE>
<CAPTION>
                                                    SECOND QUARTER ENDED
                                     May 2, 1998                             May 3, 1997
                         Income         Shares      Per Share    Income         Shares      Per Share
                       (Numerator)   (Denominator)   Amount    (Numerator)   (Denominator)   Amount
                       -----------   -------------  ---------  -----------   -------------  ---------
<S>                    <C>           <C>            <C>        <C>           <C>            <C>
Net loss               $      (150)                            $       (27)
Less: Dividends on
      preferred stock           (2)                                     (2)
                         ---------                               --------- 
BASIC EPS
Net loss attributable
      to common
      shareholders            (152)      1,725,921   $  (.09)          (29)      1,726,534   $  (.02)

Effect of dilutive
      securities                             9,143                                   5,230 
                         ---------    ------------    ------     ---------    ------------    ------
DILUTED EPS
Net loss attributable
      to common
      shareholders     $      (152)      1,735,064   $  (.09)  $       (29)      1,731,764   $  (.02)
                         =========    ============    ======     =========    ============    ====== 
</TABLE>
                                      5
<PAGE>
                              B.B. WALKER COMPANY
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued
 
Note 2, Continued 
----------------- 
<TABLE>
<CAPTION>
                                                      SIX MONTHS ENDED
                                     May 2, 1998                             May 3, 1997
                         Income         Shares      Per Share    Income         Shares      Per Share
                       (Numerator)   (Denominator)   Amount    (Numerator)   (Denominator)   Amount
                       -----------   -------------  ---------  -----------   -------------  ---------
<S>                    <C>           <C>            <C>        <C>           <C>            <C>
Net loss               $      (331)                            $      (163)
Less: Dividends on
      preferred stock           (3)                                     (3)
                         ---------                               --------- 
BASIC EPS
Net loss attributable
      to common
      shareholders            (334)      1,726,227   $  (.19)         (166)      1,726,534   $  (.10)

Effect of dilutive
      securities                            11,736                                   3,853 
                         ---------    ------------    ------     ---------    ------------    ------
DILUTED EPS
Net loss attributable
      to common
      shareholders     $      (334)      1,737,963   $  (.19)  $      (166)      1,730,387   $  (.10)
                         =========    ============    ======     =========    ============    ====== 
</TABLE>
 
Note 3 
------ 
Long-term obligations consist of the following amounts (in thousands):

                                               (Unaudited)
                                                  May 2,         November 1, 
                                                   1998             1997 
                                               -----------       ----------- 
Notes payable to banks                         $    2,246        $    2,502 
Notes payable to governmental authorities             589               610 
Promissory notes payable to shareholders            1,202             1,182 
Capital lease obligations                             -                   9 
                                                  -------           ------- 
                                                    4,037             4,303 
Less portion payable within one year                  882             1,087 
                                                  -------           ------- 
                                               $    3,155        $    3,216 
                                                  =======           ======= 
 
 
Note 4 
------ 
Inventories are composed of the following amounts (in thousands):

                                               (Unaudited)
                                                  May 2,         November 1, 
                                                   1998             1997 
                                               -----------       ----------- 

     Finished goods                            $    5,830        $    4,883 
     Work in process                                  601               884 
     Raw materials and supplies                     3,057             3,766 
                                                  -------           ------- 
                                               $    9,488        $    9,533 
                                                  =======           ======= 
                                       6
<PAGE> 
                              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 
second quarters and six months ended May 2, 1998 and May 3, 1997:

                                           Second                  Six
                                        Quarter Ended         Months Ended
                                      May 2,    May 3,      May 2,    May 3,
                                       1998      1997        1998      1997
                                     --------  --------    --------  --------
    Net sales                         100.0%    100.0%      100.0%    100.0% 
    Cost of products sold              73.7%     74.1%       74.3%     74.3% 
                                      ------    ------      ------    ------ 
      Gross margin                     26.3%     25.9%       25.7%     25.7% 

    Selling and administrative 
      expenses                         24.7%     21.3%       24.6%     22.0% 
    Depreciation and amortization        .8%      1.4%         .9%      1.5% 
    Interest expense                    3.4%      3.6%        3.5%      4.0% 
    Interest and other income           (.7%)     (.2%)      (1.2%)     (.3%)
                                      ------    ------      ------    ------ 
      Loss before income taxes 
        and minority interest          (1.9%)     (.2%)      (2.1%)    (1.5%)

    Provision for income taxes           -         .1%         -        (.5%)
    Minority interest                    -         -           -         -   
                                      ------    ------      ------    ------ 
      Net loss                         (1.9%)     (.3%)      (2.1%)    (1.0%)
                                      ======    ======      ======    ====== 


NET SALES
---------
For the second quarter of 1998, the Company's net sales were $7,779,000, or 
$320,000 (3.9%) lower than net sales of $8,099,000 in the second quarter of 
1997.  For the six month period ended May 2, 1998, net sales were $15,511,000, 
an $877,000 (5.4%) decrease from the net sales of $16,388,000 in the 
comparable six month period ended May 3, 1997.  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 92.9% of net sales in the second quarter of 1998 and 93.0% of net 
sales in the second quarter of 1997.  Retail sales made up the remaining net 
sales of 7.1% in 1998 and 7.0% in 1997.  For the comparable six month periods, 
manufactured footwear comprised 92.7% of net sales in 1998 and 92.4% of net 
sales in 1997.  The remaining net sales of 7.3% in 1998 and 7.6% in 1997 were 
sales from retail outlets.





                                      7
<PAGE>
                              B.B. WALKER COMPANY
                    MANAGEMENT'S DISCUSSION AND ANALYSIS OF
            RESULTS OF OPERATIONS AND FINANCIAL CONDITION, Continued


The primary cause for the decrease in net sales is attributed to a reduction 
in sales volume from the Company's outdoor styles.  The Company repositioned 
its product lines in the first quarter of 1997 and eliminated many 
underperforming styles, the majority of which were outdoor styles.  These 
styles were not replaced as the Company focused on its strengths, western and 
work footwear.  The Company closed out these styles during the first six 
months of 1997 and, accordingly, no comparable sales were made in the first 
six months of 1998.  This reduction in net sales has been partially offset by 
higher western branded sales in 1998 versus 1997.

For the comparable six month periods, branded net sales in 1998 were $598,000 
(6.0%) lower than 1997 branded net sales.  Branded pairs shipped were down 
15.1% in the first six months of 1998 while price per pair was up 9.7%.  In 
the second quarter, sales of the Company's branded footwear in 1998 were up 
$153,000 (3.0%) from 1997's second quarter.  Branded pairs shipped were down 
11.4% in the second quarter while price per pair improved 13.3%.  The 
improvement in price per pair can be attributed to product mix.  More of the 
Company's branded net sales are coming from its western styles that carry a 
higher price per pair than its work or outdoor styles.  The Company has also 
introduced new styles that are priced in a higher range than previous 
offerings.  In addition, during the first six months of 1997, the Company 
closed out many lower priced styles.

Private label sales in the first six months were down $307,000 (7.3%) from the 
prior year.  Pairs shipped were down 7.9% while the price per pair remained 
fairly steady.  For the second quarter, private label sales fell $606,000 
(29.8%) from the prior year's second quarter.  Pairs shipped in the second 
quarter of 1998 were 30.5% lower while the price per pair sold was comparable 
to the prior year.  Private label sales are primarily driven by a few large 
customers and are dependent on the timing of orders.  

Other sales, which consist primarily of sales from the Company's retail 
outlets and sales to institutional customers, increased $29,000 (1.3%) in the 
first six months of 1998 from the prior year.  In the second quarter of 1998, 
net sales increased $134,000 (13.3%) over the prior year.  The increase is 
attributed to stronger institutional sales as the Company continued to solicit 
this business to provide volume for the manufacturing facilities.  Retail 
sales were down primarily because of the closing of its retail outlet in 
Myrtle Beach, SC at the end of the first quarter of 1997.  This retail store 
contributed approximately $79,000 to net sales before closing.  In addition, 
same store sales for the remaining two retail stores were down approximately 
3.3%.









                                      8
<PAGE>
                              B.B. WALKER COMPANY
                    MANAGEMENT'S DISCUSSION AND ANALYSIS OF
            RESULTS OF OPERATIONS AND FINANCIAL CONDITION, Continued


GROSS MARGIN
------------
The Company's gross margin was 25.7% for the first six months of 1998 and 
1997.  For the second quarter of 1998 and 1997, the gross margin was 26.3% and 
25.9%, respectively.  The increase can be attributed to higher margins 
generated by a more favorable product mix and cost reduction efforts.  In 
addition, efficiency in the manufacturing facilities has improved the 
operating variances and the Company has produced 7.8% more pairs in 1998 than 
1997.


SELLING AND ADMINISTRATIVE EXPENSES
-----------------------------------
For the six months ended May 2, 1998 and May 3, 1997, selling and 
administrative expenses were $3,823,000 and $3,602,000, respectively, or 
$221,000 (6.1%) higher in 1998.  Selling and administrative expenses in the 
second quarter of 1998 were $1,922,000 as compared to $1,722,000 for the 
second quarter of 1997, an increase of $200,000 or 11.6%.  Most of the 
increase for the six month period and the second quarter can be attributed to 
salary and benefit costs and advertising expenses.  Salary and benefits were 
up $113,000 and $101,000 for the six months and second quarter, respectively.  
The Company has replaced some positions that were unfilled in the prior year 
as well as providing merit increases to key employees.  Advertising expenses 
have increased $132,000 and $76,000 for the six months and second quarter, 
respectively.  The Company significantly curtailed its programs in the prior 
year in response to business conditions.  In 1998, the Company has revamped 
several programs and has continued to aggressively build brand recognition for 
its products.  In addition, the Company has introduced a new brand of work 
shoe, DuraTuff, and has heavily promoted it in the market.


INTEREST EXPENSE
----------------
Interest expense for the first six months of fiscal 1998 was $541,000, a 
decrease of $113,000 from the same period in the prior year.  For the 
comparable second quarters, interest expense was $265,000, or $29,000 less 
than the prior year.  The decrease can be attributed to a lower average 
outstanding balance on the revolving credit line in 1998 versus 1997.  For the 
six month period, the average outstanding balance on the revolving credit line 
was approximately $6,745,000, or $2,058,000 less than the prior year.  The 
second quarter saw an average outstanding balance of approximately $6,661,000, 
or $1,074,000 lower than the average in the second quarter of 1997.  Interest 
and other fees incurred for this agreement were incurred at approximately the 
same rate in each year.  Other fixed long-term debt carried lower balances in 
1998 when compared to 1997 as the Company continues to amortize the debt 
according to each issue's respective terms.  No new material debt was added 
during the first six months of 1998.

                                      9
<PAGE>
                              B.B. WALKER COMPANY
                    MANAGEMENT'S DISCUSSION AND ANALYSIS OF
            RESULTS OF OPERATIONS AND FINANCIAL CONDITION, Continued


DEPRECIATION AND AMORTIZATION
-----------------------------
Depreciation and amortization was $139,000 in 1998 as compared to $239,000 in 
1997 for the first six months of the year.  For the second quarter, 
depreciation expense was $65,000 in 1998 compared to $114,000 in 1997.  The 
Company continues to invest in capital assets only as necessary to maintain 
the current level of operations.  With the low level of capital expenditures 
made in recent years, depreciation charges on fixed assets that are becoming 
fully depreciated are not being replaced, resulting in lower depreciation 
expense.


PROVISION FOR INCOME TAXES
--------------------------
For the first six months of 1998, the Company recorded no benefit from income 
taxes as compared to the first six months of 1997 where the Company recorded a 
benefit from income taxes of $80,000.  The Company exhausted all potential 
recoveries of income taxes in 1997 and no more carryback exists.  Therefore, 
the Company's net losses before income taxes are being accounted for as income 
tax loss carryforwards.  The Company evaluated the valuation allowance 
reserved against its deferred income tax asset at the end of the second 
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 $150,000 for the second quarter and a net 
loss of $331,000 for the six months ended May 2, 1998.  For the comparable 
periods of 1997, the Company had a net loss of $27,000 for the second quarter 
and a net loss of $163,000 for the six months.  A lower sales volume in 1998 
than 1997 contributed to the larger loss.


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 1.75%, or 10.25%, at May 2, 1998).  The Company had outstanding advances 
of $6,910,000 at May 2, 1998 and an additional $997,000 available under the 
agreement.




                                     10
<PAGE>
                              B.B. WALKER COMPANY
                    MANAGEMENT'S DISCUSSION AND ANALYSIS OF
            RESULTS OF OPERATIONS AND FINANCIAL CONDITION, Continued


During the first six months of 1998, the Company generated $827,000 of cash 
from operations which was used to reduce the advances under the revolving 
finance agreement by $454,000 and reduce other long-term obligations by 
$266,000.  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 currently $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 November 2, 1996 
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.  The Company is required to maintain a consolidated current 
ratio of not less than 1.35 to 1, a consolidated debt leverage ratio of not 
more than 3 to 1, a consolidated tangible net worth, as defined in the 
agreement, of not less than $5,600,000 and consolidated working capital of not 
less than $5,250,000.  In addition, at the end of the fiscal year, the Company 
must be at break even or report net income and can not make capital 
expenditures in excess of $150,000 during a fiscal year without the agreement 
of the bank.  At May 2, 1998, the Company was in technical default of its 
consolidated tangible net worth covenant.  The Company is currently 
negotiating with the bank to establish the terms of an amendment that 
addresses the financial covenants contained in the agreement.  Upon signing 
the amendment, the Company will be in compliance with each of the 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 $2,060,000.  
The term loan bears interest at the bank's prime rate plus 1.75% (10.25% at 
May 2, 1998).

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 with a bank, the Company has only been making capital 
expenditures to maintain current levels of operations during the past three 
years.  Funding for capital expenditures other than the building acquisition 
has primarily come from the available balance on the finance agreement.


                                      11
<PAGE>
                              B.B. WALKER COMPANY
                    MANAGEMENT'S DISCUSSION AND ANALYSIS OF
            RESULTS OF OPERATIONS AND FINANCIAL CONDITION, Continued


Net working capital, which consists primarily of accounts receivable and 
inventories less current liabilities, was $5,551,000 at May 2, 1998 and 
$5,900,000 at November 1, 1997.  The ratio of current assets to current 
liabilities increased to 1.45 to 1 at May 2, 1998 compared to 1.44 to 1 at 
November 1, 1997.


FINANCIAL CONDITION

ACCOUNTS RECEIVABLE
-------------------
Accounts receivable were $8,065,000 at May 2, 1998, or $1,019,000 less than 
accounts receivable of $9,084,000 at November 1, 1997.  Trade receivables are 
historically at their highest point at the end of the fiscal year because of 
the heavy sales volume related to Christmas buying by retailers.  Second, 
certain dating programs offered by the Company begin in the third quarter and 
end in the first quarter of the following fiscal year.  Accounts receivables 
related to these programs are outstanding at the end of the fiscal year but do 
not impact accounts receivable in the second quarter.


INVENTORIES
-----------
Inventories were $9,488,000 at May 2, 1998 and $9,533,000 at November 1, 1997, 
a difference of $45,000.  Of the decrease, approximately $283,000 is work in 
process and $709,000 is raw materials.  These were offset by a $947,000 
increase in finished goods.  The investment in work in process and raw 
materials are down as the Company has focused on improving the efficiency of 
materials procurement and plant utilization.  The increase in finished goods 
is attributed to the addition of the new DuraTuff brand to the work line and 
lower than expected sales volume.


BORROWINGS UNDER FINANCE AGREEMENT
----------------------------------
The balance outstanding under the finance agreement was $6,910,000 at May 2, 
1998 as compared to $7,364,000 at November 1, 1997, a decrease of $454,000.  
The decrease can be attributed to the cash applied against the outstanding 
balance from collections of accounts receivable which were down $1,019,000 in 
the first six months of 1998 and better management of inventories.











                                      12
<PAGE>
                             B.B. WALKER COMPANY
                   MANAGEMENT'S DISCUSSION AND ANALYSIS OF
           RESULTS OF OPERATIONS AND FINANCIAL CONDITION, Continued


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, 
and (5) management's ability to accurately predict the adequacy of the 
Company's financing arrangement to meet its working capital and capital 
expenditure requirements.






















                                      13

<PAGE>
PART II.  OTHER INFORMATION
---------------------------

Item 2.  Changes in Securities

         NONE 

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

         The Forty-Seventh Annual Meeting of the Shareholders of the Company  
         was held on Monday, March 16, 1998, as set forth in the Notice of 
         Annual Meeting of Shareholders dated and mailed on February 23, 1998. 
         Of the 1,726,534 shares of common stock issued and outstanding on the 
         record date, 1,380,720 shares or 79.97% of the common stock 
         outstanding were represented in person or by proxy at the meeting.  
         For the issues presented to the shareholders for their consideration, 
         the results were as follows:

         1 - The Board of Directors, in accord with the By-laws, established 
             the number of Directors at six.  The shareholders elected the six 
             persons nominated by them in the proxy statement mailed February 
             23, 1998.  All director nominees had served as directors during 
             the prior year and all were elected by the shareholders.  There 
             were no other nominations for director presented at the meeting.  
             The six nominees were elected with results as follows:

                                   Shares      Shares       Shares Marked
      Director                       For       Against    Withhold Authority
      --------                    ---------    -------    ------------------
      Kent Anderson               1,185,830       -            194,890
      George M. Ball              1,187,073       -            193,647
      Robert L. Donnell, Jr.      1,186,736       -            193,984
      James P. McDermott          1,186,760       -            193,960
      Michael C. Miller           1,375,333       -              5,387
      Edna A. Walker              1,375,333       -              5,387


       2 - Ratification by the Shareholders of the action by the Board of 
           Directors to appoint Price Waterhouse LLP as the Company's 
           independent certified public accounting firm for the 1998 fiscal 
           year.  The action was ratified with 1,374,401 shares voting for, 
           4,190 shares voting against, and 2,129 abstaining from the vote.









                                      14
<PAGE>
PART II.  OTHER INFORMATION, Continued
--------------------------------------

Item 6.  Exhibits and Reports on Form 8-K

        (a)  Exhibits Filed:

             (27)  Financial Data Schedule for the period ended May 2, 1998

        (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  June 16, 1998                   KENT T. ANDERSON 
             -------------                   -------------------------------
                                             Kent T. Anderson
                                             Chairman of the Board, Chief 
                                             Executive Officer and President




       Date  June 16, 1998                   JOHN R. WHITENER 
             -------------                   -------------------------------
                                             John R. Whitener
                                             Vice President and Controller













                                      15
<PAGE>