SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB
                                   (Mark One)

           [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                For the quarterly period ended September 30, 1998

                                       OR

          [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

             For the transition period from __________ to __________

                         Commission File Number 0-26676

                     MULTIMEDIA CONCEPTS INTERNATIONAL, INC.
             (Exact name of registrant as specified in its charter)
<TABLE>
<CAPTION>
<S>                                                                    <C>                                
          Delaware                                                     13-3835325                         
         (State or Other Jurisdiction of                               (I.R.S. Employer Identification No.)
          Incorporation or Organization)
</TABLE>
               1410 Broadway, Suite 1602, New York, New York 10018
                    (Address of Principal Executive Offices)

                                 (212) 391-1111
              (Registrant's Telephone Number, Including Area Code)

                                       N/A
              (Former Name, Former Address, and Former Fiscal Year,
                         if Changed Since Last Report)

     Check whether the Issuer (1) has filed all reports  required to be filed by
Section 13 or 15(d) of the  Securities  Exchange  Act of 1934 during the past 12
months (or for such  shorter  period that  registrant  was required to file such
reports),  and (2) has been subject to such filing  requirements for the past 90
days. Yes [X] No [ ]

     State the number of shares of each of the issuer?s classes of common equity
outstanding as of the latest  practicable date:  Common Stock,  $.001 per share:
3,005,000 shares outstanding as of December 10, 1998.



<PAGE>
            MULTIMEDIA CONCEPTS INTERNATIONAL, INC. AND SUBSIDIARIES



                                TABLE OF CONTENTS
<TABLE>
<CAPTION>

<S>                                                                                                                   <C>
PART I.              FINANCIAL INFORMATION                                                                            Page Number

Item 1.              FINANCIAL STATEMENTS

                     Consolidated balance sheets as of  September 30, 1998 (unaudited)                                          2
                     and March 31, 1998.

                     Consolidated statements of operations (unaudited) for the six months ended 
                     September 30, 1998 and September 30, 1997.                                                                 3  
                                                                                                                                
                     Condensed statements of cash flows (unaudited) for the six-months ended 
                     September 30, 1998 and September 30, 1997.                                                                 4  
                                                                                                                                
                     Notes to condensed financial statements                                                                    5

Item 2.              MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS                   7-11
                                                                                                                             
PART II.             OTHER INFORMATION                                                                                         12

Item 1.              LEGAL PROCEEDINGS

Item 2.              CHANGES IN SECURITIES AND USE OF PROCEEDS                                                                 12

Item 3.              DEFAULTS UPON SENIOR SECURITIES                                                                           12

Item 4.              SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS                                                       12

Item 5.              OTHER INFORMATION                                                                                         12

Item 6.              EXHIBITS AND REPORTS ON FORM 8-K                                                                          12

                     Signatures                                                                                                13

</TABLE>
<PAGE>
            MULTIMEDIA CONCEPTS INTERNATIONAL, INC. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS
                   As of September 30, 1998 and March 31, 1998

<TABLE>
<CAPTION>

                                                                                     Sept. 30,           March 31,
                                                                                       1998                1998
                                                                                   (Unaudited)           (Note 1)
                                             ASSETS
CURRENT ASSETS:
<S>                                                                                 <C>             <C>         
Cash and cash equivalents .......................................................   $  1,559,661    $  1,635,058
Accounts receivable .............................................................        538,502         404,288
Inventories .....................................................................     12,279,130       7,929,061
Prepaid expenses and other current assets
                                                                                         939,759         189,516
Loans and advances-affiliate ....................................................         89,815          89,815
                                                                                    ------------    ------------
          Total current assets ..................................................     15,406,867      10,247,738
                                                                                    ------------    ------------

PROPERTY AND EQUIPMENT-NET ......................................................      3,560,642       2,782,386
                                                                                    ------------    ------------


OTHER ASSETS:
Advances to equity investee .....................................................        140,000         140,000
Deposits and other assets .......................................................      2,512,040       2,580,459
                                                                                    ------------    ------------
          Total other assets ....................................................      2,652,040       2,720,459
                                                                                    ------------    ------------

          Total assets ..........................................................   $ 21,619,549    $ 15,750,583
                                                                                    ============    ============

                      LIABILITIES AND STOCKHOLDERS? EQUITY

CURRENT LIABILITIES:
Accounts payable ................................................................   $  6,640,919    $  3,593,811
Accrued expenses and other liabilities ..........................................        316,219          53,526
Current portion and other payable ...............................................      1,340,250         350,000
                                                                                    ------------    ------------
     Total current liabilities ..................................................      8,297,388       3,997,337
                                                                                    ------------    ------------
LONG-TERM LIABILITIES:
Borrowings under financing agreement ............................................      8,481,996       5,445,198
Note payable, net of current portion ............................................        157,200       1,500,000
Deferred rent liability .........................................................        119,453         110,351
                                                                                                    ------------
          Total long-term liabilities ...........................................      8,758,649       7,055,549
                                                                                    ------------    ------------
          Total liabilities .....................................................     17,056,037      11,052,886
                                                                                    ------------    ------------
MINORITY INTEREST IN
     SUBSIDIARIES (Note 3) ......................................................      2,939,558       2,713,709
                                                                                    ------------    ------------
STOCKHOLDERS? EQUITY:
    Common stock, $.001 par value;
      10,000,000 shares authorized,
      3,005,000 shares issued and ...............................................          3,005           3,005
      outstanding
   Additional paid-in capital ...................................................     13,102,005      13,102,005
Retained earnings (Deficit) .....................................................    (11,481,056)    (11,121,022)
                                                                                    ------------    ------------
          Total stockholders? equity ............................................      1,623,954       1,983,988
                                                                                    ------------    ------------
          Total liabilities and
             stockholders? equity ...............................................   $ 21,619,549    $ 15,750,583
                                                                                    ------------    ------------

</TABLE>
<PAGE>
            MULTIMEDIA CONCEPTS INTERNATIONAL, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENT OF OPERATIONS

                                   (Unaudited)
<TABLE>
<CAPTION>

               
                                                                      For the Three Months Ended          For the Six Months Ended

                                                                       Sept. 30,         Sept. 30,      Sept. 30,         Sept. 30,
                                                                         1998              1997          1998               1997
     
<S>                                                                    <C>             <C>             <C>             <C>         
REVENUES, net sales .................................................. $  6,656,037    $    793,037    $ 13,978,783    $  1,834,472
                                                                       ------------    ------------    ------------    ------------
COSTS AND EXPENSES:
Cost  of sales .......................................................    3,775,821         744,121       8,180,243       1,502,007
Operating expenses ...................................................    2,798,043           1,129       5,664,530         160,434
Depreciation and amortization ........................................      194,029            --           382,681            --
          Total operating expense ....................................    6,767,893         745,250      14,227,454       1,662,441
                                                                       ------------    ------------    ------------    ------------

OPERATING INCOME (LOSS) ..............................................     (111,856)         47,787        (248,671)        172,031

OTHER INCOME
  Interest income ....................................................            2            --            12,502            --
                                                                       ------------    ------------    ------------    ------------

INTEREST EXPENSE:
  Interest and finance charges ........................................     156,860         215,791         295,312         182,161
  Amortization of debt issuance costs .................................      27,202            --            54,402            --
          Total interest expense ......................................     184,062         215,791         349,714         182,161
                                                                       ------------    ------------    ------------    ------------
INCOME (LOSS) BEFORE
MINORITY INTERESTS ....................................................    (695,916)       (168,004)       (585,883)        (10,130)
  Minority interests (Note 3) .........................................     124,471            --           225,849            --

NET INCOME (LOSS) .....................................................    (171,445)       (128,004)       (360,034)        (10,130)

Basic and Diluted income and (loss) per common share before minority interests

                                                                       $       (.10)   $       (.06)   $       (.19)   $      (.003)

Minority interests in net income (loss)  of consolidated subsidiaries
                                                                                .04            --               .08            --
                                                                       ------------    ------------    ------------    ------------

Basic and Diluted income (loss) per common share
                                                                       $       (.06)   $       (.06)   $       (.11)   $      (.003)
                                                                       ============    ============    ============    ============

Weighted average number of common shares outstanding
                                                                          3,005,000       3,005,000       3,005,000       3,005,000
                                                                       ============    ============    ============    ============
</TABLE>
                                        3


<PAGE>
            MULTIMEDIA CONCEPTS INTERNATIONAL, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENT OF CASH FLOWS
                                   (Unaudited)
                           Increase (Decrease) in Cash
<TABLE>
<CAPTION>

     
                                                                                 Six Months Ended


                                                                            Sept. 30,              Sept. 30,
                                                                               1998                  1997
CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                                           <C>                    <C>      
Net Income (loss)                                                             $(360,034)             $(10,130)

Adjustments  to  reconcile  net  loss  to cash  (used)  provided  for  operating
   activities:
   Depreciation and amortization                                                 382,681                15,449
   Deferred rent                                                                   9,102               -
   Minority interests in net losses of subsidiaries                              225,849               -
Changes in assets and liabilities:
Decrease in Accounts receivable                                                (134,214)              (25,136)
(Increase) in Merchandise inventories                                        (4,350,069)              (36,662)
Decrease in prepaid expenses and other current assets                          (750,243)               -
Decrease in deposits and other assets                                             68,419                  (50)
Increase in accounts payable                                                   3,047,108             (100,380)
Increase in accrued expenses and other liabilities                               262,695               (6,507)
          Total adjustments                                                  (1,238,692)             (153,286)
          Net cash provided by operating activities                          (1,598,726)             (163,416)
                                                                        ------------------     -----------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment                                           (1,160,919)               -
                                                                        ------------------
          Net cash provided by (used for ) investing activities              (1,160,919)               -
                                                                        ------------------     -----------------

CASH FLOWS FROM FINANCING ACTIVITIES:
Net borrowings under financing agreement of subsidiary                         3,036,798               -
Repayment of notes payable of subsidiary                                       (352,550)               -
Loans receivable-officer                                                        -                    (282,059)
Loans receivable from (repaid to) affiliate                                     -                    (132,913)
          Net cash provided by (used for) financing activities                 2,684,248             (414,972)
                                                                        ------------------     -----------------

NET INCREASE (DECREASE) IN CASH                                                 (75,397)             (578,388)
Cash, beginning of period                                                      1,635,058               591,577
                                                                        ------------------     -----------------
Cash, end of period                                                           $1,559,661               $13,189
                                                                              ==========               =======

Supplemental disclosure of cash flow information:
Interest paid                                                                   $349,714              $ -
Taxes paid                                                                       -                     -

</TABLE>



                                        4


<PAGE>
            MULTIMEDIA CONCEPTS INTERNATIONAL, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)


Note 1.           BASIS OF PRESENTATION:

     The  accompanying  unaudited  consolidated  financial  statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and the instructions to Form 10-QSB. Accordingly,  they do
not include all the  information  and footnotes  required by generally  accepted
accounting principles for more complete financial statements.  In the opinion of
management,  the interim financial statements include all adjustments considered
necessary for a fair  presentation of the Company?s  financial  position and the
results of its  operations  for the six months ended  September 30, 1998 and are
not  necessarily  indicative  of the results to be expected  for the full fiscal
year. For further information,  refer to the Company?s Transition report on Form
10-KSB for the six months ended March 31, 1998, as filed with the Securities and
Exchange Commission.

     In December  1997,  the  Company?s  Board of Directors  voted to change the
Company?s  fiscal  year  from  September  30th  to  March  31st.  The  financial
statements for the six months ended September 30, 1997 have not been restated to
reflect the acquisition of United Textiles & Toys Corp. ("UTTC").

Note 2.           DESCRIPTION OF COMPANY:

     Multimedia  Concepts  International,  Inc.  (the  "Company")  is a Delaware
corporation  which  was  organized  in  June  1994  under  the  name  U.S.  Food
Corporation. The Company changed its name to American Eagle Holdings Corporation
in  April  1995 and then to its  present  name in June  1995.  The  Company  was
initially  formed as a holding  company for the purpose of forming an integrated
clothing  design,  manufacturing,  and  distribution  operation.  The Company is
currently,  in principle, a holding company for its two operating  subsidiaries:
(i) its  wholly  owned  subsidiary  U.S.  Apparel  Corp.  ("USAC")  and (ii) its
majority owned  subsidiary  Play Co. Toys &  Entertainment  Corp.  ("Play Co."),
owned by the Company via its  ownership  of 78.5% of the  outstanding  shares of
common  stock of UTTC,  which  owns  60.6% of Play  Co.  All  references  to the
"Company" refer to USAC and Play Co. unless otherwise required by the context.

     In February 1997, the Company formed a wholly-owned subsidiary, USAC, a New
York  corporation,  to design and manufacture a line of private label cotton tee
shirts and collared type tops predominately for men.

<PAGE>
            MULTIMEDIA CONCEPTS INTERNATIONAL, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)


Note 2.           DESCRIPTION OF COMPANY: (continued)

     In January 1998,  UTTC issued  3,571,429  shares of its common stock to the
Company in full  repayment of certain loans  aggregating  $1,000,000  previously
made by the Company to UTTC.  This conversion of debt to equity was performed at
a price of $0.28 per share. As a result of the transaction, the Company acquired
78.5% ownership of UTTC.

Note 3.           MINORITY INTERESTS:

     The Company owns a majority  interest (78.5%) in UTTC, which in turn owns a
majority interest (60.6%) in Play Co. The minority interest liability represents
the minority  shareholders?  portion  (21.5%) of UTTC equity and (39.4%) of Play
Co.?s equity at September 30, 1998.

Note 4.           INVESTMENT BY U.S. STORES CORP.:

     On January 20, 1998, U.S. Stores Corp. ("U.S.  Stores") acquired  1,465,000
shares of the Company?s  Common Stock.  U.S. Stores was incorporated on November
10, 1997.  The Company?s  President is also the President and a Director of U.S.
Stores.  After this  transaction,  U.S.  Stores held an  aggregate  of 1,868,000
shares  of the  Company?s  Common  Stock,  or 62.2% of the  outstanding  shares,
effectively making the Company a subsidiary of U.S. Stores.

     On February 28, 1998,  American Telecom  Corporation  ("American  Telecom")
acquired 100% of the outstanding common shares of U.S. Stores.  American Telecom
was incorporated on July 11, 1997. The Company?s President is also the President
and a  Director  of  U.S.  Stores.  After  this  transaction,  American  Telecom
effectively obtained beneficial control of the Company and its subsidiaries.

     In April 1998, the  shareholders of American  Telecom  exchanged all of the
outstanding  common  shares of American  Telecom with American  Telecom,  PLC, a
publicly  traded  company  in  Great  Britain.  Additionally,  American  Telecom
exchanged all of the  outstanding  shares of U.S.  Stores with American  Telecom
PLC. The shareholders of American  Telecom received shares of American  Telecom,
PLC in the exchange. After this transaction, American Telecom effectively became
a  subsidiary  of  American  Telecom,  PLC.   Additionally,   as  part  of  this
transaction,  American  Telecom,  PLC acquired  100% of the  outstanding  common
shares  of  U.S.  Stores,  thereby  effectively  making  U.S.  Stores  a  direct
subsidiary of American Telecom, PLC.

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

                  Results of Operations

     Statements  contained in this report which are not historical  facts may be
considered forward looking  information with respect to plans,  projections,  or
future  performance  of the  Company as  defined  under the  Private  Securities
Litigation  Reform Act of 1995. These forward looking  statements are subject to
risks and  uncertainties  which could cause actual results to differ  materially
from those projected.

     Three  months  ended  September  30, 1998  compared to three  months  ended
September 30, 1997

     Consolidated  sales for the three  months  ended  September  30,  1998 were
$6,656,037. The consolidated sales for the three months ended September 30, 1998
include  sales of Play Co. in the amount of $  6,098,315  and sales  reported by
USAC amounted to $557,722.


<PAGE>
     Consolidated  cost of sales for the three months ended  September  30, 1998
were $3,775,821,  or 56.7%, of sales.  The component  breakdown of this category
was as follows:

                                    USAC                      $  361,767
                                    Play Co.                   3,414,054

     Consolidated  operating expenses were $2,798,043,  or 42%, of sales for the
three months ended September 30, 1998.

     Consolidated  depreciation  and  amortization  expense in the three  months
ended September 30, 1998 was $194,209, or 2.9% of sales.

     Consolidated  interest  expense  amounted to $184,062  for the three months
ended September 30, 1998, or 2.8% of sales.

     For the three months ended September 30, 1998, subsequent to the adjustment
for the  minority  interest  in the net  losses  of  subsidiaries,  the  Company
reported  a  consolidated  net loss of  $171,445,  or a basic  loss of $0.06 per
common share.

     Six months  ended  September  30,  1998  compared  to the six months  ended
September 30, 1997

     Consolidated  sales were $13,978,783 for the six months ended September 30,
1998. The consolidated sales for the six months ended September 30, 1998 include
$12,460,021  in sales from UTTC and Play Co. in the amount of  $12,460,021,  and
$1,518,762 in sales reported by USAC.

     Consolidated cost of sales were $8,180,243,  or 58.5% of sales, for the six
months ended September 30, 1998. The component breakdown of this category was as
follows:

                           USAC                      $1,059,858
                           Play Co.                    7,120,385

     Consolidated operating expenses were $5,664,530, or 40.5% of sales, for the
six months ended September 30, 1998.

     For  the  six  months  ended  September  30,  1998,  consolidated  non-cash
depreciation and amortization were $382,681, or 2.7% of sales.

     Consolidated  interest expense was $349,714,  or 2.5% of sales, for the six
months ended September 30, 1998.

     For the six  months  ended  September  30,  1998,  the  Company  reported a
consolidated  net loss of $360,034  (after  reflecting  the  adjustment  for the
minority interests), or a basic loss per share of $0.11.

                  Liquidity and Capital Resources

     At September  30, 1998,  the Company  reported  consolidated  cash and cash
equivalents  of  $1,559,661,  working  capital of $7,109,479  and  stockholders?
equity of  $1,623,954  reflecting  the net loss of  $360,034  for the six months
ended September 30, 1998.

     During the six month period ending  September 30, 1998,  the Company,  on a
consolidated  basis,  used $1,598,726 in cash in its operating  activities.  The
primary reason the cash was used for operating activities was the net investment
(increase  in  merchandise  inventories  less  increase in accounts  payable) in
inventories of $1,302,961.

     The Company,  on a consolidated basis, used $1,160,919 of cash in investing
activities  during the six month period ended  September  30, 1998.  The primary
investing  activity was the  purchase of equipment  and fixtures by Play Co. for
its new stores.


<PAGE>
     The Company on a consolidated basis generated $2,684,248 from its financing
activities in the six month period ended September 30, 1998. These proceeds were
used to finance  Play Co.?s  capital  requirements,  capital  expenditures,  and
operating losses during the six months ended September 30, 1998.

     As a result of the above factors, the Company, on a consolidated basis, had
a net decrease in cash of $75,397 in the six months ended September 30, 1998.

     During the three month period ended September 30, 1998, Play Co. opened two
new stores. These stores, and all stores Play Co. intends to open in the future,
are  considered  by  management  to be  high-end  retail  toy  and  educational,
electronic interactive stores, in presentation,  which offer items comparable in
quality  and choice to those  offered by FAO  Schwarz  and Warner  Brothers  and
Disney Stores and which  attract  clientele  similar to those  attracted by such
stores. The first store opened in Primm, Nevada near Las Vegas in July 1998. The
second store opened in September in  Grapevine,  Texas near Dallas.  Both stores
are located in high traffic shopping malls. The capital  investment for building
each of those stores was approximately $300,000.

     In early  November  1998,  Play Co.  opened  new stores in  Thousand  Oaks,
California  near Los Angeles and in Auburn Hills,  Michigan near Detroit.  These
stores  are also  located  in high  traffic  shopping  malls.  These two  stores
represented an aggregate capital  investment of approximately  $613,000,  net of
landlord tenant improvement ("Landlord TI") contributions.

     On November 19 and 20, 1998, Play Co. opened two additional  stores, one in
Orange County  California  and one in Gurnee,  Illinois  (near  Chicago).  These
stores represent the final two of the six stores Play Co. planned to open during
calendar year 1998. These two stores represented an aggregate capital investment
of approximately $500,000, net of Landlord TI contributions. Play Co. now has 25
stores located in six states.

     Play Co. had  planned  to  finance  the  costs,  now  estimated  to be $1.7
million, net of Landlord TI contributions,  of building the new stores described
above  through a  combination  of  capital  lease  financing,  use of Play Co.?s
working  capital,  and the sale of  additional  equity.  Play Co.  has  obtained
approximately  $260,000 in lease  financing on the equipment and fixtures of the
Nevada and Century City stores. Play Co. is also in the documentation phase of a
five year term loan in the principal amount of approximately $500,000 with a new
lender.  That term loan will be secured by the equipment and fixed assets of the
new Texas store and three existing stores.

     Play  Co.  continues  to  seek  additional  lease  financing  based  on the
equipment  and fixtures of its new stores in  California  (two),  Michigan,  and
Illinois.  There  can be no  assurance  that  Play  Co.  will be able to  obtain
sufficient  financing  to offset  the new  store  opening  costs  that have been
incurred.

     On September  18, 1998,  Play Co.  borrowed  $1,000,000  from Amir Overseas
Capital Corp.  ("Amir") under a Secured  Subordinated  Promissory Note. The Note
bears interest at 12% and calls for three  installment  payments ending December
23, 1998. On November 9, 1998,  Play Co.  borrowed an  additional  $250,000 from
Amir  under a  Promissory  Note.  The Note bears  interest  at 12% and calls for
repayment on January 29, 1998.

     In September  1998,  Play Co. and FINOVA  Capital  Corporation,  Play Co.?s
working  capital  lender,  amended  Play Co.?s Loan and  Security  Agreement  to
increase the maximum  level of  borrowings  under same from $7.6 million to $8.6
million  through  December 31, 1998.  Beginning on January 1, 1999,  the maximum
level of borrowings  will return to the $7.6 million level.  Play Co. expects to
utilize this  additional  amount on its credit line to partially  finance either
its  working  capital,   particularly   inventory  purchases,   or  the  capital
expenditures noted above.


<PAGE>
                  Year 2000

     Earlier  in  1998,  Play  Co.  developed  a plan to  upgrade  its  existing
management  information  system ("MIS") and computer hardware and to become year
2000 compliant.  Play Co. has now purchased the necessary  hardware and software
and is in the process of installing the software. Play Co. has completed the MIS
hardware  upgrade  and plans to finish  the year 2000  compliance  work in early
1999.

     To finance the cost of new hardware in the computer upgrade  project,  Play
Co. entered into a lease in the amount of $82,472 bearing  interest at a rate of
10.8%. The total cost of the hardware and software purchased for the project was
approximately $100,000.

     Beyond the above noted  internal  year 2000 system  issue,  Play Co. has no
current  knowledge of any outside third party year 2000 issues that would result
in a material negative impact on its operations. Should Play Co. become aware of
any such situation, contingency plans will be developed.

                  Trends Affecting Liquidity, Capital Resources and Operations

     As a result of its current merchandise mix, which emphasizes  specialty and
educational  toys, Play Co. enjoyed  significant  sales and gross profits in the
six months ended September 30, 1998. The mix of specialty and  educational  toys
includes  collectible die cast cars,  specialty  yo-yo?s,  Rokenbok and Learning
Curve toys, and Beanie Babies and other plush and many other  educational  toys.
While Play Co. believes that these  particular toys will remain popular with its
customer  base for the remainder of 1998,  there can be no assurance  that these
particular  specialty  toys will continue to  contribute  strongly to Play Co.?s
sales and gross  profits.  The history of the toy industry,  however,  indicates
that there is generally at least one highly popular toy every year.

     Play Co.?s  sales  efforts are focused  primarily  on a defined  geographic
consisting of the Southern  California area and the  Southwestern and Midwestern
United  States.  Play Co.?s future  financial  performance  will depend upon (i)
continued demand for high-end specialty,  educational,  and traditional toys and
management?s ability to adapt to continuously  changing consumer preferences and
the market for such items,  (ii) general economic  conditions  within Play Co.?s
geographic  market area,  as same may be expanded,  (iii) Play Co.?s  ability to
choose locations for new stores, (iv) Play Co.?s ability to purchase products at
favorable  prices and on  favorable  terms,  and (v) the  effects  of  increased
competition.

     The toy and hobby retail  industry  faces a number of  potentially  adverse
business  conditions  including  price and gross  margin  pressures  and  market
consolidation.   Play  Co.  competes  with  a  variety  of  mass  merchandisers,
superstores,  and other toy retailers,  including Toys R Us, Kay Bee Toy Stores,
Walmart,  and K Mart.  Competitors that emphasize specialty and educational toys
include Disney Stores, Warner Brothers Stores,  Learning Smith, Lake Shore, Zany
Brainy, and Noodle Kidoodle.  There can be no assurance that Play Co.?s business
strategy  will enable it to compete  effectively  in the retail toy  industry or
that Play Co. will be able to generate  sufficient  revenues or have  sufficient
control over expenses and other charges to increase profitability.

                  Inflation and Seasonality

     The impact of inflation on Play Co.?s  results of  operations  has not been
significant.  Play Co. attempts to pass on increased costs by increasing product
prices over time.

     Play Co.?s operations are highly seasonal with approximately  30-40% of its
net sales historically falling within Play Co.?s third quarter,  which coincides
with the Christmas  selling season.  Play Co. intends to open stores  throughout
the year, but generally  before the Christmas  selling  season,  which will make
Play Co.?s third  quarter  sales an even greater  percentage of the total year?s
sales.


<PAGE>
                           PART II - OTHER INFORMATION


Item 1. Legal Proceedings: None

Item 2. Changes in Securities: None

Item 3. Defaults Upon Senior Securities: None

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

     On  November  10,  1998,   the  Company  held  an  annual  meeting  of  its
stockholders,  at which four  Directors  were elected to the Company's  Board of
Directors to hold office for a period of one year or until their  successors are
duly elected and qualified.

     The results of the election of four Directors were as follows:
<TABLE>
<CAPTION>

                                                     Votes Cast
                                                           For                                   Abstentions

<S>                                                           <C>                                <C>   
Ilan Arbel                                                    2,947,495                          29,897
Rivka Arbel                                                   2,947,495                          29,897
Yair Arbel                                                    2,947,495                          29,897
Neil Grippa                                                         600                               0
</TABLE>

Item 5. Other Information: None

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

Exhibits: The following are the exhibits filed with this Form 10-QSB:

27 - Financial Data Schedule

Reports on Form 8-K: None



                                        6


<PAGE>
                                   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 this 25th day of November, 1998.


MULTIMEDIA CONCEPTS INTERNATIONAL, INC.
(Registrant)


By: /s/ Ilan Arbel
Ilan Arbel
President


By: /s/ Allean Goode
Allean Goode
Treasurer



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