<PAGE>   1
                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                   FORM 10-Q

(Mark One)

[X]   Quarterly report pursuant to Section 13 or 15(d) of the Securities
      Exchange Act of 1934

FOR THE PERIOD ENDED FEBRUARY 28, 1997

                                     OR

[ ]   Transition report pursuant to Section 13 or 15(d) of the Securities
      Exchange Act of 1934

COMMISSION FILE NUMBER 0-26774


                               TST/IMPRESO, INC.
            (exact name of registrant as specified in it's charter)

          DELAWARE                                    75-1517936
(state or other jurisdiction of                    (I.R.S. Employer
  incorporation or organization)                  Identification No.)

                         652 SOUTHWESTERN BOULEVARD
                            COPPELL, TEXAS 75019
                  (Address of principal executive offices)

                        TELEPHONE NUMBER (972) 462-0100
              (Registrant's telephone number, including area code)

         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
                    -----                             -----

Indicate the number of shares outstanding of each of the issurer's classes of
Common Stock as of the latest practical date.

<TABLE>
      <S>                                  <C>
      Class of Common Stock                Shares outstanding at  April 10, 1997
      ---------------------                -------------------------------------
         $ .01 Par Value                                  5,247,730
</TABLE>
<PAGE>   2
                       TST/IMPRESO, INC. AND SUBSIDIARIES
                                   FORM 10-Q
                               FEBRUARY 28, 1997



                                     INDEX


<TABLE>
<CAPTION>


PART I.     FINANCIAL INFORMATION                                             PAGE NUMBER

<S>                                                                             <C>

     Item 1.  Consolidated Financial Statements:

                  Interim Consolidated Balance Sheets as of February 28,
                  1997 (Unaudited) and August 31, 1996 . . . . . . . . . . . .      2

                  Interim Consolidated Statements of Operations for the
                  Six Months Ended February 28, 1997 and February 29, 1996
                  (Unaudited). . . . . . . . . . . . . . . . . . . . . . . . .      4

                  Interim Consolidated Statements of Cash Flows for the
                  Six Months Ended February 28, 1997 and  February 29, 1996
                  (Unaudited). . . . . . . . . . . . . . . . . . . . . . . . .      5

                  Notes to Interim Consolidated Financial Statements . . . . .      6

     Item 2.  Management's Discussion and Analysis of Financial
              Condition and Results of Operations  . . . . . . . . . . . . . .     10

PART II.    OTHER INFORMATION

     Item 6.  Exhibits and Reports on Form 8-K . . . . . . . . . . . . . . . .     14

SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     15

</TABLE>



                                       1

<PAGE>   3

PART 1:       FINANCIAL INFORMATION


ITEM 1:       FINANCIAL STATEMENTS


                       TST/IMPRESO, INC. AND SUBSIDIARIES

                      INTERIM CONSOLIDATED BALANCE SHEETS

                                     ASSETS
                                  (UNAUDITED)

<TABLE>
<CAPTION>

                                                                      February 28,     August 31,
                                                                          1997           1996
                                                                      ------------    ------------
Current assets:
<S>                                                                   <C>             <C>         
         Cash and cash equivalents                                    $  2,658,394    $  2,368,395
         Trade accounts receivable, net of  allowance
                for doubtful accounts of $130,000 at
                February 28, 1997 and $163,633 at August 31, 1996        3,075,109    $  2,890,411
         Investments                                                        --             250,000
         Inventories                                                     8,283,515       6,343,731
         Prepaid expenses and other                                        292,025         301,731
                                                                      ------------    ------------
                  Total current assets                                  14,309,043      12,154,268

Property, plant, and equipment, at cost                                 12,867,302      12,465,865
         Less-Accumulated depreciation                                  (8,584,607)     (8,372,733)
                                                                      ------------    ------------
                  Net property, plant, and equipment                     4,282,695       4,093,132

Other assets:
         Deposits and other                                                239,457         708,751
         Investments                                                         4,954           4,954
                                                                      ------------    ------------

                  Total assets                                        $ 18,836,149    $ 16,961,105
                                                                      ------------    ------------

</TABLE>


                THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF
                      THESE CONSOLIDATED BALANCE SHEETS.

                                       2

<PAGE>   4

                       TST/IMPRESO, INC. AND SUBSIDIARIES

               INTERIM CONSOLIDATED BALANCE SHEETS - (CONTINUED)

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

                                                                                  February 28,     August 31,
                                                                                      1997            1996
                                                                                   -----------   -----------
Current liabilities:
<S>                                                                                <C>           <C>        
       Accounts payable                                                            $ 2,178,147   $ 1,563,662
       Accrued liabilities                                                             201,239       239,886
       Accrued bonuses                                                                    --         175,000
       Accrued income taxes                                                             13,679        69,235
       Current maturities of long-term debt                                              1,700        36,769
       Line of credit                                                                1,644,415       138,391
        liabilities-
         Current maturities of prepetition taxes payable                                25,722        25,722
         Current maturities of long-term debt                                           73,230        74,975
                                                                                   -----------   -----------
                  Total current liabilities                                          4,138,132     2,323,640


Deferred income tax liability                                                          581,437       567,618
Long-term portion of prepetition debt, net of current maturities                     1,053,955     1,088,480
Long-term debt, net of current maturities                                                3,511         3,309
                                                                                   -----------   -----------
                  Total liabilities                                                  5,777,035     3,983,047
                                                                                   -----------   -----------
Commitments and contingencies

Stockholders' equity:
       Preferred Stock, $.01 par value; 5,000,000 shares authorized; 0 shares
            issued and outstanding at February 28, 1997, and August 31, 1996              --            --
       Common Stock, $.01 par value; 15,000,000 shares authorized 5,247,730
            shares issued and outstanding at February 28, 1997, and
            August 31, 1996                                                             52,477        52,477
       Warrants                                                                            110           110
       Additional paid-in capital                                                    5,937,896     5,937,896
       Retained earnings                                                             7,068,631     6,987,575
                                                                                   -----------   -----------
                  Total stockholders' equity                                        13,059,114    12,978,058
                                                                                   -----------   -----------

                  Total liabilities and stockholders' equity                       $18,836,149   $16,961,105
                                                                                   -----------   -----------
</TABLE>


              THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE
                         CONSOLIDATED BALANCE SHEETS.

                                       3

<PAGE>   5

                       TST/IMPRESO, INC. AND SUBSIDIARIES

                  INTERIM CONSOLIDATED STATEMENT OF OPERATIONS
                                  (UNAUDITED)

<TABLE>
<CAPTION>


                                                         Three Months Ended              Six Months Ended
                                                         ------------------              ----------------
                                                    February 28    February 29,    February 28,    February 29,
                                                        1997           1996            1997            1996
                                                   ------------     -----------    ------------    ------------
<S>                                                <C>             <C>             <C>             <C>         
Net Sales                                          $  8,766,322     $13,445,934    $ 17,571,892    $ 25,325,138
Cost of sales                                         7,764,858      10,673,446      15,327,695      20,211,617
                                                   ------------     -----------    ------------    ------------
         Gross profit                                 1,001,464       2,772,488       2,244,197       5,113,521

Other costs and expenses:
         Selling, general, and administrative         1,017,237       1,145,081       2,105,635       2,255,141
         Interest expense                                47,224          72,093          99,002         261,570
         Other (income) expense, net                    (68,401)          6,215         (90,484)         36,036
                                                   ------------     -----------    ------------    ------------
         Total other costs and expenses                 996,060       1,223,389       2,114,153       2,552,747

Income before income tax expense and                      5,404       1,549,099         130,044       2,560,774
extraordinary gain

Income tax expense:
         Current                                         (7,531)        530,060          35,169         899,344
         Deferred                                        11,248          (5,706)         13,819          15,880
                                                   ------------     -----------    ------------    ------------
Income before extraordinary gain                          1,687       1,024,745          81,056       1,645,550

Extraordinary gain from debt reduction and
restructuring due to bankruptcy, net of tax
effect of $83,808 and $159,377 respectively                --           162,049            --           294,430
                                                   ------------     -----------    ------------    ------------
Net income                                         $      1,687     $1 ,186,794    $     81,056    $  1,939,980

Income per share (primary and fully diluted):
      Income before extraordinary gain             $       --       $      0.20    $       0.02    $       0.33
      Extraordinary gain                                   --              0.03            --              0.06
                                                   ------------     -----------    ------------    ------------

         Net income per common share               $       --       $      0.23    $       0.02    $       0.39
                                                   ------------     -----------    ------------    ------------

Weighted average shares outstanding                   5,247,730       5,247,730       5,247,730       4,933,006

</TABLE>


              THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE
                      CONSOLIDATED FINANCIAL STATEMENTS.


                                       4

<PAGE>   6

                       TST/IMPRESO, INC. AND SUBSIDIARIES

                 INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS
                                  (UNAUDITED)

<TABLE>
<CAPTION>

                                                                           Six Months Ended
                                                                           ----------------
                                                                      February 28,   February 29,
                                                                          1997           1996
                                                                      -----------    -----------
    CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                                   <C>            <C>        
       Net income                                                     $    81,056    $ 1,939,980
       Adjustments to reconcile net income to net cash
         flow provided by operating activities-
            Extraordinary gain                                               --         (453,807)
            Depreciation and amortization                                 211,873        174,669
            Deferred income taxes                                          13,819         15,880
           (Increase) in accounts receivable, net                        (184,698)      (997,813)
           (Increase) decrease in inventory                            (1,939,784)       447,020
           (Increase) decrease in prepaid expenses and other                9,706        (39,631)
           Increase in accounts payable                                   614,485        719,150
           Increase (decrease) in accrued liabilities                     (38,647)        24,728
           Increase (decrease) in accrued bonuses                        (175,000)      (540,539)
           Increase (decrease) in accrued income taxes                    (55,556)       265,351
                                                                      -----------    -----------
             Net cash provided by (used in) operating activities       (1,462,746)     1,554,988
                                                                      -----------    -----------

CASH FLOWS FROM INVESTING ACTIVITIES:

       Additions to property, plant, and equipment                       (401,436)      (571,181)
       Sale of investments                                                250,000           --
       Change in other non current assets, net                            469,294        325,908
                                                                      -----------    -----------
             Net cash provided by (used in) investing activities          317,858       (245,273)
                                                                      -----------    -----------


CASH FLOW FROM FINANCING ACTIVITIES:

             Net borrowing (payments) on line of credit                 1,506,024     (3,843,083)
             Payments on prepetition debt                                 (36,270)    (2,631,311)
             Payments on postpetition debt, net                           (34,867)       (41,307)
             Sale of Common Stock  and warrants                              --        5,977,476
                                                                      -----------    -----------
             Net cash provided by (used in) financing activities        1,434,887       (538,225)
                                                                      -----------    -----------

NET INCREASE  IN CASH AND CASH EQUIVALENTS:                               289,999        771,490

Cash and cash equivalents, beginning of period                          2,368,395         92,081
                                                                      -----------    -----------
Cash and cash equivalents, end of period                              $ 2,658,394    $   863,571
                                                                      -----------    -----------
</TABLE>

              THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE
                      CONSOLIDATED FINANCIAL STATEMENTS.


                                       5

<PAGE>   7

                       TST/IMPRESO, INC. AND SUBSIDIARIES

               NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
                                  (UNAUDITED)

1.       ORGANIZATION AND NATURE OF BUSINESS

         TST/Impreso, Inc., a Delaware corporation, is a manufacturer and
         distributor to dealers and other resellers of paper products for
         commercial and home use in domestic and international markets. The
         Company's product line consists of standard continuous computer stock
         business forms for use in computer printers; facsimile paper for use
         in thermal facsimile machines, and cut sheet paper for use in copying
         machines, laser printers, and ink jet printers. TST/Impreso, Inc. has
         three wholly owned subsidiaries: Big Time Paper, Inc., TST/Impreso of
         California, Inc., and Texas Stock Tab of West Virginia, Inc. Each
         subsidiary was formed to support activities of TST/Impreso, Inc.
         (referred to collectively with its consolidated subsidiaries as " the
         Company").

         In April 1993, the Company emerged from a Chapter 11 bankruptcy
         proceeding instituted by it in November 1992. The filing was primarily
         due to the Company's inability to renegotiate its line of credit
         agreement with its primary lender regarding amounts owed to the lender
         under the Company's guarantee of indebtedness for a subsidiary
         operating as a business consumable wholesaler in which the Company had
         a majority interest. The subsidiary was simultaneously liquidated in a
         Chapter 7 bankruptcy.

2.       INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

         In the opinion of management, the Interim Unaudited Consolidated
         Financial Statements of the Company include all adjustments,
         consisting of any normal recurring adjustments, necessary for a fair
         presentation of the Company's financial position as of February 28,
         1997, and its results of operations for the six months ended February
         28, 1997, and February 29, 1996. Results of the Company's operations
         for the interim period ended February 28, 1997, may not be indicative
         of results for the full fiscal year. Certain information and footnote
         disclosures normally included in financial statements prepared in
         accordance with generally accepted accounting principles have been
         condensed or omitted pursuant to the rules and regulations promulgated
         by the Securities and Exchange Commission (the "SEC").

         The Interim Unaudited Consolidated Financial Statements should be read
         in conjunction with the Audited Consolidated Financial Statements and
         accompanying notes of the Company and its subsidiaries, included in
         the Company's Form 10-K (the "Company's Form 10-K") for the fiscal
         year ended August 31, 1996, File Number 0-26774. Accounting policies
         used in the preparation of the Interim Unaudited Consolidated
         Financial Statements are consistent in all material respects with the
         accounting policies described in the Notes to Consolidated Financial
         Statements in the Company's Form 10-K.

3.       NEW ACCOUNTING PRONOUNCEMENT

         In October 1995, the Financial Accounting Standards Board ("FASB")
         issued SFAS No. 123, "Accounting for Stock-Based Compensation, " which
         requires entities to measure compensation costs related to awards of
         stock-based compensation using either the fair value method or the
         intrinsic method value method. Under the fair value method,
         compensation expense is measured at the grant date based on the fair
         value of the award. Under the intrinsic value method, compensation is
         equal to the excess, if any, of the quoted market price of the stock
         at the grant date over the amount the employee must pay to acquire the
         stock. Entities electing to measure compensation costs using the
         intrinsic value method must make pro forma disclosures for fiscal
         years beginning after December 15, 1995, of net income and earnings
         per share as if the fair value method had been applied. The Company
         has elected to account for stock-based compensation programs using the
         intrinsic value



                                       6

<PAGE>   8


         method consistent with existing accounting policies and, therefore,
         the standard will have no effect on the consolidated financial
         statements. The required pro forma disclosures will be adopted by the
         Company for the Company's fiscal year ending August 31, 1997.

4.       UTILIZATION OF IPO PROCEEDS

         In fiscal year ended August 31, 1996, the Company recorded net
         proceeds of $5.9 million on the sale of 1,247,730 shares of Common
         Stock in the Company's Initial Public Offering ("IPO"). The Company
         utilized $4.9 million to repay indebtedness. In the three months ended
         February 29, 1996, part of the proceeds were applied to a secured
         prepetition note, prepaid at a discounted amount, resulting in an
         extraordinary gain, and the Company applied 65% of the proceeds to
         reduce the Company's utilization of its revolving line of credit.
         The remaining proceeds were used for working capital purposes.

5.       EXTRAORDINARY ITEM

         In the quarter ended February 29, 1996, the Company recorded an
         extraordinary gain totaling $162,049, net of related income tax
         expense of $83,808. The extraordinary gain resulted from the Company's
         early extinguishment of a note payable to a financial institution with
         a face amount of $1,616,883 for a negotiated discounted amount of
         $1,371,026. The Company utilized proceeds from its initial public
         offering along with income from operations to extinguish these debts.

6.       INVENTORIES

         Inventories are stated at the lower of cost (principally on a
         first-in, first-out basis) or market and include material, labor, and
         factory overhead.

         Inventory consisted of the following:
<TABLE>
<CAPTION>
         
                                                 February 28,        August 31,
                                                 -----------         ----------
                                                    1997                1996
                                                 -----------         ----------
            <S>                                   <C>                <C>       
            Finished goods                        $3,788,807         $3,642,869
            Raw materials                          4,018,307          2,296,347
            Supplies                                 426,418            351,909
            Work-in-process                           49,983             52,606
                                                  ----------         ----------
                     Total inventories            $8,283,515         $6,343,731
                                                  ----------         ----------
</TABLE>

7.       DEBT

         Debt as of February 28, 1997, and August 31, 1996, is as follows:

<TABLE>
<CAPTION>
                                                                 
                                                          February 28,   August 31,
                                                              1997          1996
                                                          -----------    ----------
         Postpetition-                                                 
<S>                                                       <C>            <C>       
         Note payable to a commercial financial                        
         corporation under revolving credit line                       
         maturing May 1998, secured by inventory,                      
         trade accounts receivable, equipment,                         
         and a personal guarantee by the trustee of a                  
         trust which is the majority shareholder,                      
         interest payable monthly at prime plus 1.00%                  
         (9.25% at February 28,1997, and                               
         August 31, 1996)                                 $1,644,415     $  138,391
</TABLE>



                                       7

<PAGE>   9
<TABLE>
<S>                                                                 <C>          <C>   
         Note payable to a commercial financial corporation, 
           payable in monthly installments, security, interest, 
           and maturity date, same as above                           --         40,078
         
         Prepetition-
         
         Prepetition taxes payable                                  77,165       77,165
         
         Note payable to a bank, secured by property, payable 
           in monthly installments of $4,815 (including 
           interest at 6%) through May 2000, at which time 
           the remaining balance becomes due and payable           601,265      611,926
         
         Other notes payable, approximately $450,000, are 
           secured by a personal guarantee by the trustee of 
           a trust which is the majority shareholder, and 
           certain property, plant, and equipment, with various 
           maturity dates through 2023, and interest rates 
           ranging from 4% to 10.5%                                479,688      500,086
                                                                ----------   ----------
                         Total                                   2,802,533    1,367,646
         
         Less-Current maturities                                 1,745,067      275,857
                                                                ----------   ----------
                                                                $1,057,466   $1,091,789
                                                                ----------   ----------
</TABLE>


         Prepetition amounts listed above represent the renegotiated amounts
         and terms under the plan of reorganization. The postpetition line of
         revolving credit is shown above as a current maturity.


8.       SUPPLEMENTAL  CASH FLOW INFORMATION

<TABLE>
<CAPTION>
         
                                                  Six Months Ended
                                             February 28,   February 29,
                                             ---------------------------
                                                 1997           1996
<S>                                            <C>            <C>     
         Cash paid during the period for:
                  Interest                     $ 99,002       $261,570
                  Income taxes                     --          710,364
</TABLE>

9.       STOCK OPTIONS AND WARRANTS

         During the quarter ended November 30, 1995, the Company granted
         293,800 options to certain employees, an outside Director, and a
         consultant under its 1995 Stock Option Plan (the "Plan"). These
         options were granted at an exercise price of $6.00 per share, the fair
         market value at the date of grant. These options will become
         exercisable at various dates beginning in April 1996, through April
         1999. Thirty-six hundred of those options were forfeited during the
         1996 fiscal year, 1,350 of those options were forfeited during the
         quarter ended November 30,1996, and 450 of those options were
         forfeited during the quarter ended February 28,1997.

         On January 2, 1996, the Company elected two new outside Directors to
         its Board of Directors. In accordance with the Plan, each Director
         received an automatic grant of an option for 1,000 shares of Common
         Stock. These options were granted at the fair market value at the date
         of grant with an exercise price of $6.75 per share and are exercisable
         in two equal annual installments.



                                       8

<PAGE>   10


         On October 1, 1996, an officer of the Company was granted an option
         for 15,000 shares of Common Stock. These options were granted at the
         fair market value at the date of grant with an exercise price of
         $5.375 per share and are exercisable in accordance with the Plan
         beginning on April 1, 1997.

         On January 29, 1997, the three outside Directors received their
         automatic grants of an option for 1,000 shares of Common stock . These
         options were granted at fair market value at the date of grant with an
         exercise price of $8.375 per share and are exercisable in accordance
         with the Plan beginning on January 29, 1998.

         As of February 28,1997, 73,350 of the options granted under the Plan
         are exercisable. The shares issuable on exercise of these options are
         restricted from public sale until April 5,1997, by the Underwriters'
         Agreement. Remaining options available for grant under the Plan,
         including all forfeited options, total 91,600.

         In addition to options under the Plan, in October 1995, in connection
         with the Company's initial public offering ("IPO"), the Company
         granted an option to purchase up to 147,730 shares of Common Stock
         (over-allotment option) to its Underwriters at $6.00 per share. The
         option was exercised in full on November 14, 1995.

         Also in connection with the Company's IPO, the Company issued warrants
         to its Underwriters for $.001 per warrant to purchase an aggregate of
         110,000 shares of Common Stock. The warrants became exercisable on
         October 5, 1996, for four years at an exercise price of $7.20 per
         share.

         Subsequent to the IPO, the Company issued warrants to two consultants.
         One warrant for 10,000 shares of Common Stock was granted at an
         exercise price of $7.20 per share, which was above fair market value
         on the date of grant, and is exercisable for a period of five years
         from December 1, 1995 . The other warrant, also for 10,000 shares of
         Common Stock, was granted at an exercise price of $6.60 per share,
         which was above fair market value on the date of grant, and became
         exercisable October 5, 1996, for a period of four years.

         On April 7, 1997, the Company filed a Registration Statement on Form
         S-8 with the Securities and Exchange Commission to register the
         400,000 shares of Common Stock issuable on exercise of options granted
         under the Company's 1995 Stock Option Plan.

10.      EMPLOYEE 401(K) PLAN

         In February 1996, the Company implemented an employee 401(k) plan. The
         Plan is administered by a national brokerage firm and administrative
         fees associated with the plan are funded by the plan. The Company is
         matching 5% of up to 10% of the participating employees' deductible
         contribution to their 401(K) accounts. Contributions by the Company
         were $3,500 and $9,500 for the six months ended February 28, 1997, and
         the year ended August 31, 1996, respectively.

11.      EARNINGS PER COMMON SHARE

         Earnings per share is based on the weighted average number of common
         shares outstanding. Common share equivalents have not been included in
         the computation of earnings per share as the dilution of these
         equivalents is not considered material.


                                       9

<PAGE>   11

12.      SUPPLEMENTAL EARNINGS PER SHARE DATA

         In October 1995, the Company's registration statement on Form S-1
         filed with the SEC was declared effective for the sale of 1,247,730
         shares (including over-allotment option shares) at $6.00 per share.
         The unaudited supplemental earnings per share data has been calculated
         assuming the IPO occurred as of the beginning of each respective 
         period.

<TABLE>
<CAPTION>
         
                                            Six Months Ended     Six Months Ended
                                            February 28, 1997    February 29, 1996
                                            -----------------    -----------------
<S>                                             <C>                    <C>   
         Supplemental income per share 
           (primary and fully diluted):
         
         Income before extraordinary gain       $ 0.02                 $ 0.31
         Extraordinary gain                       --                     0.06
                                                ------                 ------  
         Net income per common share            $ 0.02                 $ 0.37
                                                ------                 ------  
         
         
         Supplemental weighted average 
           shares outstanding                5,247,730              5,247,730
</TABLE>


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

Results of Operations for the Interim Periods Ended February 28,1997 and 
February 29,1996

         Net Sales---Net sales for the three months ended February 28, 1997,
         decreased $4.7 million, or 34.8%, as compared to the corresponding
         period of the prior year. Net sales for the six months ended February
         28, 1997, decreased $7.8 million, or 30.6% as compared to the
         corresponding period of the prior year. These decreases were due to
         decreases in the selling prices of the Company's products combined
         with depressed market conditions resulting in reduced sales volume,
         and a reduction in sales volume to a significant customer of the
         Company. This customer's gross purchases for the three months ended
         February 28, 1997, was 11.4% of the Company's gross sales as compared
         to 26.5% of the corresponding period of the prior year, and for the six
         months ended February 28, 1997, was 9.6%, as compared to 23.7% of the
         corresponding period of the prior year. Beginning in fiscal 1997, to
         avoid dependency on the Company as its sole source of supply for the
         products the Company produces, the significant customer began
         purchasing products from another vendor. No other single existing or
         new customer represented a significant portion of the Company's
         revenues during this time.
        
         Gross Profit---Gross profit for the three months ended February 28,
         1997, decreased $1.8 million, or 63.9%, as compared to the
         corresponding period of the prior year. The decreased gross profit was
         primarily the result of decreases in the selling prices of the
         Company's products without a corresponding decrease in raw material
         costs. Gross profit for the six months ended February 28, 1997,
         decreased $2.9 million, or 56.1%, as compared to the corresponding
         period of the prior year due to the inability of the Company to pass
         onto the Company's customers increased material costs resulting from
         fluctuations in the raw material market. As a result of decreased
         gross profit and net sales, the Company's gross profit margin
         decreased to 11.4% for the three month period ended February 28, 1997,
         as compared to 20.6% of the corresponding period of the prior year,
         and to 12.8% for the six months ended February 28, 1997, as compared
         to 20.2% of the corresponding period of the prior year.

         In the second quarter of 1997, the Company acquired a second sheeter.
         This sheeter can produce high volume commodity sheets, and can also
         manufacture certain types of value-added cut sheet. Value-added cut
         sheets include, but are not limited to, printed, perforated, or
         punched cut sheets; specially coated papers; and custom sizes and
         packages. A third sheeter was installed on January 7, 1997. The
         Company is slowly introducing value-added products into the market
         place. The Company previously purchased its cut sheet products
         directly from the paper mills. The addition of sheeting equipment is
         projected to expand the Company's profit margin on the sale of all
         types of cut sheets. Management is aggressively pursuing the cut sheet
         market for future revenue growth.




                                      10

<PAGE>   12




         Selling, General, and Administrative Expenses---SG&A expenses for the
         three months ended February 28, 1997, were $1.0 million, or 11.6% of
         net sales, as compared to $1.1 million, or 8.5% of net sales, for the
         corresponding period of the prior year. SG&A Expenses for the six
         months ended February 28, 1997, were $2.1 million, or 12% of net
         sales, as compared to $2.3 million, or 8.9% for the corresponding
         period of the prior year. SG&A expenses, although slightly reduced in
         the 1997 periods, remained approximately constant in dollars, but
         increased as a percentage of net sales during these periods because of
         the decreased net sales and the effects of fixed expenses.

         Interest Expense---Interest expense for the three months ended
         February 28, 1997, was $ 47,000 as compared to $72,000 for the
         corresponding period of the prior year. Interest expense for the six
         months ended February 28, 1997, was $99,000 as compared to $262,000
         for the corresponding period of the prior year. The decrease in
         interest expense for the three and six month periods ended February
         28, 1997, as compared to the corresponding periods of the prior year
         were primarily attributable to a lower interest rate on, and the
         pay-down of, the Company's revolving line of credit and the early
         extinguishment of a prepetition note payable .

         Income before taxes and extraordinary gain---Income before taxes and
         extraordinary gain for the three months ended February 28, 1997, was
         $5,000 as compared to $1.5 million for the corresponding period of the
         prior year, a decrease of $1.5 million or 99.7%. Income before taxes
         and extraordinary gain for the six months ended February 28, 1997, was
         $130,000 as compared to $2.6 million for the corresponding period of
         the prior year, a decrease of $2.4 million, or 94.9%. These decreases
         were primarily due to a lower sales volume, decreases in the selling
         prices of the Company's products without a corresponding reduction in
         raw material costs, and depressed market conditions.

         Extraordinary Gain---The Company did not record an extraordinary gain
         for the six months ended February 28, 1997, as compared to an
         extraordinary gain totalling $295,000, net of related income tax
         expense of $159,000, for the corresponding period of the prior year.
         The prior year gain result from the Company's early extinguishment of
         a prepetition note payable for a discounted amount.

         Income Taxes---The Company's provision for income taxes was $1,000 for
         the three months ended February 28, 1997, as compared to $1.0 million
         for the corresponding period of the prior year. The Company's
         provision for income taxes was $81,000 for the six months ended
         February 28, 1997, as compared to $1.6 million for the corresponding
         period of the prior year. These decreases were primarily due to
         decreased sales volume and decreased net profit . The effective tax
         rate for the six month period ended February 28, 1997, was 37.7% as
         compared to 35.7% for the corresponding period of the prior year.

Liquidity and Capital Resources

         Net cash used in operating activities was $1.4 million for the six
         months ended February 28, 1997, as compared with $1.6 million provided
         by operating activities for the corresponding period of the prior
         year. The decrease in the Company's net cash provided by operations
         for the six months ended February 28, 1997, primarily related to
         decreases in net income and increases in raw material inventory. The
         Company's inventories during the six months ended February 28, 1997,
         have increased approximately 31% from the fiscal year ended August 31,
         1996. A majority of the increase in inventory was raw material
         purchased for conversion to cut sheets on the Company's sheeters.
         During the second quarter of fiscal 1997, the sheeters reached full
         operating capacity. Gross sales of cut sheets for the six month period
         ended February 28, 1997, increased 37%, as compared to the
         corresponding period of the prior year.

         Net cash provided by investing activities was $318,000 for the six
         months ended February 28, 1997, as compared with $245,000 used in
         investing activities for the corresponding period of the prior year.
         The increase in the Company's net cash provided by investing
         activities primarily related to converting an investment security to a
         cash equivalent.




                                       11

<PAGE>   13





         Net cash provided by financing activities was $1.4 million for the six
         months ended February 28, 1997, as compared with $538,000 used in
         financing activities for the corresponding period of the prior year.
         The increase in cash provided by financing activities primarily
         related to an increase in the Company's borrowings under its revolving
         line of credit to $1.6 million at February 28, 1997, from $138,000 at
         August 31, 1996. The Company utilized its revolving line of credit to
         meet capital expenditures due to the decrease in funds available from
         net profits.

         Working capital increased to $10.2 million at February 28, 1997, from
         $9.8 million at August 31, 1996, an increase of 3.5%, primarily
         attributable to an increase in inventories.

         In the fiscal year ended August 31, 1996, the Company recorded net
         proceeds of $5.9 million on the sale of 1,247,730 shares of Common
         Stock in the Company's Initial Public Offering ("IPO"). The Company
         utilized $4.9 million to repay indebtedness. In the three months ended
         February 29, 1996, part of the proceeds were applied to a secured
         prepetition note, prepaid at a discounted amount, resulting in an
         extraordinary gain, and the Company applied 65% of the proceeds to
         reduce the Company's utilization of it's revolving line of credit. The
         availability of the revolving credit line was $4,862,000 and
         $1,157,000 as of August 31, 1996, and August 1995, respectively. The
         balance of the proceeds were used to increase the Company's working
         capital.

         In May 1996, the Company entered into an agreement with a bank for a
         one year, secured, revolving line of credit, which is secured by,
         among other things, inventory, trade receivables, equipment and a
         personal guarantee of Mr. Sorokwasz, Chairman of the Board, President
         of the Company, and Trustee of the trust which is the majority
         shareholder of the Company. Available borrowings under this line of
         credit, which accrues interest at the prime rate of interest plus 1%
         (9.25% at February 28, 1997), are based upon specified percentages of
         eligible accounts receivable and inventories. As of February 28, 1997,
         there was a $3.4 million borrowing capacity remaining under the $5
         million revolving line of credit. The revolving credit line which
         matures in May 1997, has been automatically renewed under identical
         terms until May 1998.

         The Company is in final contract negotiations with a national
         manufacturer of computer hardware to manufacture, market, and
         distribute products with the national manufacturer's trademark.
         However, there is no assurance that a final agreement will be arrived
         at or that the agreement will be signed. If a definitive agreement is
         signed, the Company expects that it will result in a substantial
         increase in Company sales, but there can be no assurance that such
         sales will be profitable.

         The Company believes that the funds available under the revolving
         credit line facility, trade credit, and internally generated funds
         will be sufficient to satisfy the Company's requirements for working
         capital and capital expenditures for at least the next twelve months.
         Such belief is based on certain assumptions, including the
         continuation of current operations of the Company and no extraordinary
         adverse events, and there can be no assurance that such assumptions
         are correct. In addition, contingencies or expansion based upon the
         completion of contract negotiations between the Company and the
         national manufacturer of computer hardware may arise which may require
         the Company to obtain additional capital. In fiscal 1998, the Company
         may pursue an acquisition, or the addition of new manufacturing
         facilities. If that should occur, the funds required for the potential
         acquisition or new facilities would be generated through additional
         security offerings or additional debt. There can be no assurance that
         any additional financing will be available if needed, or, if
         available, will be on terms acceptable to the Company.

Inventory Management

         The Company believes that it is necessary to maintain a large
         inventory of finished goods and raw materials to adequately service
         its customers. The Company attempts to maintain an minimum of $6.0
         million in inventory. With the expansion of the Company's capacity to
         produce cut sheet products, the Company has increased its inventory.
         In accordance with the Company's strategic raw material purchasing
         policies and in




                                      12

<PAGE>   14

         order to obtain preferential pricing, the Company waives the rights to
         supplier's inventory protection agreements ( including price
         protection and inventory return rights). The Company bears the risk of
         increases in the prices charged by its suppliers and decreases in the
         prices of raw materials held in its inventory or covered by purchase
         commitments. If prices for products held in the finished goods
         inventory of the Company decline or if prices for raw materials
         required by the Company decline, or if new technology is developed
         that renders obsolete products distributed by the Company and held in
         inventory, the Company's business could be materially adversely
         affected.

Seasonality

         The Company generally experiences a relative slowness in sales during
         the summer months, which may adversely affect the Company's third and
         fourth fiscal quarter results in relation to sequential quarter
         performance.

Inflation

         The Company believes that inflation has not had a significant impact
         on the Company's operations. Historically, the Company has been
         successful in transferring to its customers increases in its
         manufacturing and other costs resulting from inflation by means of
         price increases.

Forward-Looking Statements

         Management's Discussion and Analysis of Financial Condition and the
         Results of Operations, and other sections of this Form 10-Q contain
         "forward-looking statements" about the Company's prospects for the
         future, such as its ability to generate sufficient working capital,
         its ability to continue to maintain sales to justify capital expenses,
         its ability to generate additional sales to meet business expansion,
         and potential sales to a large potential customer. Such statements are
         subject to certain risks and uncertainties which could cause actual
         results to differ materially from those projected, including
         availability of raw materials, availability of thermal facsimile,
         computer, laser and color ink jet paper, to the cyclical nature of the
         industry in which the Company operates, the potential of technological
         changes which would adversely affect the need for the Company's
         products, price fluctuations which could adversely impact the large
         inventory required in the Company's business, the ability of the large
         potential customer to change its plans and decline to execute the
         contract, and the potential that such contract may not prove
         profitable. Parties are cautioned not to rely on any such
         forward-looking beliefs or judgments in making investment decisions.



                                      13

<PAGE>   15

PART II:           OTHER INFORMATION

ITEM 6:            EXHIBITS AND REPORTS ON FORM 8-K


      a)    NUMBER          EXHIBIT

            3(a)            Certificate of Incorporation of the Company
                            (incorporated by reference to Exhibit 3.1 to
                            Registration Statement on Form S-1 No. 33-93814)

            3(b)            By-laws of the Company (incorporated by reference
                            to Exhibit 3.2 to Registration Statement on Form
                            S-1 No. 33-93814)

            4               Form of Underwriters' Warrant (incorporated by
                            reference to Exhibit 4.1 to Registration Statement
                            on Form S-1 No. 33-93814)

            10(a)           1995 Stock Option Plan (incorporated by reference
                            to Exhibit 10.1 to Registration Statement on Form
                            S-1 No. 33-93814)

            10(b)           Employment Agreement dated September 28,1995,
                            between the Company and Marshall Sorokwasz
                            (incorporated by reference to Exhibit 10.2 to
                            Registration Statement on Form S-1 No. 33-93814)

            21              Subsidiaries of the Registrant (incorporated by
                            reference to Exhibit 21.1 to Registration Statement
                            on Form S-1 No. 33-93814)

            27              Financial data schedule


      b) No reports on Form 8-K were filed during the quarter ended 
         February 28, 1997.



                                      14

<PAGE>   16

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.

         Dated: April 14, 1997

                                            TST/ Impreso, Inc.
                                            (Registrant)

                                            /s/ Marshall Sorokwasz
                                            ------------------------------
                                            Marshall Sorokwasz
                                            Chairman of the Board
                                            President, Chief Executive Officer,
                                            and Director


                                            /s/ Susan Atkins
                                            ------------------------------
                                            Susan Atkins
                                            Vice President and Chief
                                            Financial Officer



                                      15
<PAGE>   17


            EXHIBIT 
            NUMBER                        ITEM
            -------                       ----

            3(a)            Certificate of Incorporation of the Company
                            (incorporated by reference to Exhibit 3.1 to
                            Registration Statement on Form S-1 No. 33-93814)

            3(b)            By-laws of the Company (incorporated by reference
                            to Exhibit 3.2 to Registration Statement on Form
                            S-1 No. 33-93814)

            4               Form of Underwriters' Warrant (incorporated by
                            reference to Exhibit 4.1 to Registration Statement
                            on Form S-1 No. 33-93814)

            10(a)           1995 Stock Option Plan (incorporated by reference
                            to Exhibit 10.1 to Registration Statement on Form
                            S-1 No. 33-93814)

            10(b)           Employment Agreement dated September 28,1995,
                            between the Company and Marshall Sorokwasz
                            (incorporated by reference to Exhibit 10.2 to
                            Registration Statement on Form S-1 No. 33-93814)

            21              Subsidiaries of the Registrant (incorporated by
                            reference to Exhibit 21.1 to Registration Statement
                            on Form S-1 No. 33-93814)

            27              Financial data schedule