FORM 10-K

                     SECURITIES AND EXCHANGE COMMISSION
                           Washington, D.C. 20549

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

       For the fiscal year ended October 2, 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 1-10704

                           Sport Supply Group, Inc.
   
           (Exact name of registrant as specified in its charter)

                 Delaware                           75-2241783            
       (State or other jurisdiction of           (I.R.S. Employer
       incorporation or organization)           Identification No.)

        1901 Diplomat Drive, Farmers Branch, Texas         75234
   
        (Address of principal executive offices)         (Zip Code)

  Registrant's telephone number, including area code:    (972) 484-9484    

  Securities registered pursuant to Section 12(b) of the Act:

                                                 Name of each exchange on
        Title of each class                          which registered
        Common Stock, $ .01 Par Value            New York Stock Exchange
        Common Stock Purchase Warrants           American Stock Exchange

  Securities registered pursuant to Section 12(g) of the Act:

                                    None
                              (Title of Class)
<PAGE>
       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 by check mark if  disclosure of delinquent filers  pursuant
  to Item 405 of Regulation  S-K is not contained  herein, and will not  be
  contained, to the best of registrant's knowledge, in definitive proxy  or
  information statements incorporated by reference in Part III of this Form
  10-K or any amendment to this Form 10-K. [   ]
  
       The aggregate  market  value  of  the  voting  stock  held  by  non-
  affiliates of the  registrant on November  5, 1998 based  on the  closing
  price of the common stock  on the New York  Stock Exchange on such  date,
  was approximately $54,000,000.

       Indicated below is the number of outstanding shares of each class of
  the registrant's common stock, as of November 5, 1998.

       Title of Each Class of Common Stock            Number Outstanding

  Common Stock, $.01 par value                            7,619,703

                     DOCUMENTS INCORPORATED BY REFERENCE

          Document                                 Part of the Form 10-K
  Proxy Statement for Annual Meeting of
  Stockholders to be held January 29, 1999                   Part III


<PAGE>

                                 TABLE OF CONTENTS

       Item                                                    Page

  PART I

        1   Business..........................................    3

        2   Properties........................................    9

        3   Legal Proceedings.................................    9

        4   Submission of Matters to a Vote of Security Holders  10

  PART II

        5   Market for Registrant's Common Equity and Related
             Stockholder Matters..............................   10

        6   Selected Financial Data...........................   12

        7   Management's Discussion and Analysis of Financial
             Condition and Results of Operations .............   13

        8   Financial Statements and Supplementary Data.......   20

        9   Changes in and Disagreements with Accountants on
             Accounting and Financial Disclosure..............   42

  PART III

       10   Directors and Executive Officers of the Registrant   42

       11   Executive Compensation............................   42

       12   Security Ownership of Certain Beneficial Owners
             and Management...................................   42

       13   Certain Relationships and Related Transactions....   42

  PART IV

       14   Exhibits, Financial Statement Schedules, and
            Reports on Form 8-K...............................   43

<PAGE>
                                   PART I

  Item 1.   Business.

  General

       Sport Supply Group,  Inc. (the  "Company" or  "SSG") is  one of  the
  largest direct mail  marketers of  sports related  equipment and  leisure
  products to the institutional market in  the United States.  The  Company
  principally serves the institutional market, which is comprised primarily
  of  schools,  colleges,   universities,  government  agencies,   military
  facilities,  athletic  clubs,  youth  sports  leagues  and   recreational
  organizations.  SSG offers a broad line of institutional-grade  equipment
  and provides  after-sale  customer  service  through  the  use  of  sales
  personnel strategically located in certain large metropolitan areas  (the
  "Metro Marketing  Group").    See  Item  1.  --  "Business  -  Sales  and
  Marketing."  The Company believes that  prompt delivery of a broad  range
  of institutional-grade products at  competitive prices differentiates  it
  from the retail sporting goods stores  that primarily serve the  consumer
  market.  The  Company also serves  the local sporting  goods team  dealer
  market principally  with  its  MacGregor brand  products.    The  Company
  markets approximately  8,000 sports  related equipment  products to  over
  100,000 institutional, retail,  mass merchant and  team dealer  customers
  and maintains over 200,000 names in mailing lists.

       In May 1996, the Company made  the strategic decision to dispose  of
  its golf operations to focus on its core institutional business.  On  May
  20, 1996 as part of this plan of disposal, the Company sold virtually all
  of the  assets of  its Gold  Eagle Professional  Golf Products  Division,
  which sold golf accessory products to the retail market.  In addition  to
  the sale of  Gold Eagle, the  Company adopted a  plan to  dispose of  the
  remaining operations  of its  retail golf  segment and  classified  these
  operations as discontinued.  On March  28, 1997, the Company disposed  of
  substantially all of the remaining  assets of the discontinued  operation
  to Nitro Leisure Products, Inc.,  a Delaware corporation. The  discussion
  in this  Report on  Form 10-K  regarding the  Company's business,  unless
  otherwise noted,  relates only  to  the Company's  continuing  operations
  (i.e., core institutional business).   Consequently, the Company will  no
  longer report segment information about this operation.  For a discussion
  regarding the  Company's  discontinued operations,  see  Note 10  to  the
  consolidated financial  statements  included  in Item  8.  --  "Financial
  Statements and Supplementary Data."

       The Company's net revenues have increased  from $67 million in  1994
  to $97 million for the fiscal year   ended October 2, 1998.  The  Company
  attributes its high level of growth  to the successful development of  an
  effective mail order marketing  program and competitive pricing  programs
  that have led to  greater market penetration and  to the development  of,
  and increase in, the Company's manufacturing capabilities.
<PAGE>
       On December 10,  1996, pursuant to  a Securities Purchase  Agreement
  dated November 27, 1996 between Emerson  Radio Corp. ("Emerson") and  the
  Company (the "Purchase  Agreement"), Emerson acquired  directly from  the
  Company  (i) 1,600,000 shares of newly-issued Common Stock (the  "Emerson
  Shares")  for  an  aggregate   cash  consideration  of  $11,500,000,   or
  approximately $7.19 per share,  and  (ii)  5-year warrants (the  "Emerson
  Warrants") to acquire an additional 1,000,000  shares of Common Stock  at
  an exercise price of $7.50 per  share, subject to standard  anti-dilution
  adjustments, for  an  aggregate  cash  consideration  of  $500,000.    In
  addition, Emerson agreed to arrange for foreign trade credit financing of
  $2 million for  the benefit of  the Company to  supplement the  Company's
  existing  credit  facilities.    If  all  of  the  Emerson  Warrants  are
  exercised,  Emerson  will  own  approximately  38%  of  the  issued   and
  outstanding shares of Common Stock.  See Item 12 -- Security Ownership of
  Certain Beneficial  Owners  and  Management"  and  Item  13  --  "Certain
  Relationships and Related Transactions."

       The Company is a  Delaware corporation incorporated  in 1982 and  in
  1988 became the successor of an operating division of Aurora Electronics,
  Inc. (f/k/a BSN Corp. and referred to herein as "Aurora").  Prior to  the
  completion of  the initial  public offering  of 3,500,000  shares of  the
  Company's common stock  in April, 1991,  the Company  was a  wholly-owned
  subsidiary of  Aurora.   The  Company  has one  wholly-owned  subsidiary,
  Athletic  Training  Equipment  Company,  Inc.,  a  Delaware   corporation
  ("ATEC''), acquired in December, 1997,  which was previously named  Sport
  Supply Group International Holdings, Inc.

       The Company's executive offices are located at 1901 Diplomat  Drive,
  Farmers Branch, Texas 75234 and its  telephone number is (972)  484-9484.
  The Company also has a website  to provide certain information about  the
  Company.  The website is www.sportsupplygroup.com.

  Products

       The Company  believes it  manufactures and  distributes one  of  the
  broadest lines of sports  related equipment and  leisure products to  the
  institutional market.  SSG offers approximately 8,000 sporting goods  and
  sports related  products,  over 3,000  of  which it  manufactures.    The
  product lines  offered by  SSG include  archery, baseball  and  softball,
  basketball,  camping,  football,   tennis  and   other  racquet   sports,
  gymnastics, indoor recreation, physical education, soccer, field  hockey,
  lacrosse,  track  and  field,  volleyball,  weight  lifting,     exercise
  equipment, and early childhood development products.

       The  Company  believes  brand   recognition  is  important  in   the
  institutional and  team  dealer markets.    Most of  SSG's  products  are
  marketed under  trade  names  or trademarks  owned  or  licensed  by  the
  Company. SSG believes its trade names and trademarks are well  recognized
  among institutional purchasers of sports related equipment.  SSG  intends
  to continue to expand  its product and brand  name offerings by  actively
  pursuing product,  trademark and  trade name  licensing arrangements  and
  acquisitions.  The Company's trademarks,  service marks, and trade  names
  include the following:

    .  Official Factory Direct Equipment Supplier of Little League Baseball
       (See discussion below).
<PAGE>       
    .  Voit[R] --  institutional  sports related  equipment  and  products,
       including  inflated  balls  and   baseball  and  softball   products
       (licensed from Voit Corporation - see discussion below).
       
    .  MacGregor[R]  --  certain  equipment  and  accessories  relating  to
       baseball, softball,  basketball, soccer,  football, volleyball,  and
       general exercise  (e.g., dumbbells,  curling bars,  etc.)  (licensed
       from MacMark Corporation - see discussion below).
     
    .  Alumagoal[R]  --  track  and  field  equipment,  including  starting
       blocks, hurdles, pole vault and high jump standards and crossbars.
       
    .  AMF -- gymnastics equipment (licensed from  AMF Bowling, Inc. -  see
       discussion below).

    .  ATEC _ pitching machines and related baseball and softball  training
       equipment.
  
    .  BSN[R] -- sport balls and mail order catalogs.
       
    .  Champion --  barbells,  dumbbells  and weight  lifting  benches  and
       machines.
       
    .  Curvemaster[R] -- baseball and softball pitching machines.
       
    .  Fibersport -- pole vaulting equipment.
       
    .  Gamecraft --  field and  floor hockey  equipment, soccer  equipment,
       scorebooks, coaching equipment, and table tennis equipment.
       
    .  GSC Sports -- gymnastics equipment.
       
    .  Hammett & Sons -- indoor table-top games.
       
    .  Maxpro[R] --  products  include,  among  others,  football  practice
       dummies, baseball, and other protective helmets and pads (other than
       football  protective  equipment),  baseball  chest  protectors   and
       baseball mitts and gloves (licensed from Proacq Corp., a  subsidiary
       of Riddell Sports Inc.).
       
    .  New England  Camp and  Supply --  camping and  outdoor  recreational
       equipment and accessories.
       
    .  North American  Recreation[R] --  billiard, table  tennis and  other
       game tables.
       
    .  Passon's Sports -- mail order catalogs.
       
    .  Pillo Polo[R] -- recreational polo and hockey games.
       
    .  Port-A-Pit[R] -- high jump and pole vault landing pits.
       
    .  Pro Base[R] -- baseball bases.
       
    .  Pro Down -- football down markers.
       
    .  Pro Net -- nets, net assemblies and frames and practice cages.
<PAGE>       
    .  Rol-Dri[R]  and  Tidi-Court   --  golf  course   and  tennis   court
       maintenance equipment.
       
    .  Safe-Squat -- specialty weight lifting squat machines.
       
    .  Toppleball[R] -- recreational ball games.
       
    .  U.S. Games,  Inc.[R]  --  goals, nets,  and  playing  equipment  for
       physical exercise games and mail order catalogs.

       The Voit license permits the Company to use the Voit[R] trademark in
  connection with the manufacture, advertisement, and sale to institutional
  customers and sporting  goods dealers of  specified institutional  sports
  related equipment and products, including  inflated balls for all  sports
  and baseball  and softball  products.   The Company  is required  to  pay
  annual royalties under  the license  equal to  the greater  of a  certain
  percentage of  revenues from  the  sale of  Voit  products or  a  minimum
  royalty as set forth in the License  Agreement.  The initial term of  the
  Voit license  expired on  December 31,  1989, and  was subject  to  three
  renewal options  for consecutive  terms  of five  years  each.   SSG  has
  exercised two renewal periods, and currently is permitted to use the Voit
  trademark through December 31, 1999.

       In February, 1992, the Company acquired two separate licenses to use
  several trade names, styles, and  trademarks (including, but not  limited
  to, MacGregor[R]).   Each  license permits  the Company  to  manufacture,
  promote, sell, and distribute  to institutional sporting goods  customers
  (subject to certain exceptions) in the United States, Canada, and Mexico,
  specified institutional sports related equipment and products relating to
  baseball, softball, basketball, soccer, football, volleyball, and general
  exercise.  Each  license is royalty-free  and exclusive  with respect  to
  certain customers and non-exclusive with respect to others.  Each license
  is perpetual  provided  the  Company generates  a  predetermined  minimum
  amount of  revenues each  year  from the  sale  of products  bearing  the
  MacGregor  trademark,  maintains  certain  quality  standards  for   such
  products and services, and does not commit any default under the  license
  agreements that remains uncured for a period of 30 days after the Company
  receives notice of such default.  The Company has converted a substantial
  portion of its products to the  MacGregor[R] brand, which is believed  to
  be one of the most widely recognized trade names in the industry.   These
  products are  being  sold  to  customers  using  the  Company's  existing
  marketing channels.  See Item 1. -- "Business - Sales and Marketing."

       On August 19, 1993,  the Company entered  into an exclusive  license
  agreement with AMF Bowling, Inc. to  use the AMF name in connection  with
  the promotion  and sale  of certain  gymnastics equipment  in the  United
  States and Canada.   The  Company is required  to pay  an annual  royalty
  under the license equal  to the greater of:  (i) a certain percentage  of
  net revenues from the sale of AMF products; or (ii) a minimum royalty  as
  set forth in the license agreement.   The minimum royalty increases by  a
  predetermined percentage each  year the license  agreement is in  effect.
  The initial term of the agreement  expired on December 31, 1995, and  was
  subject to three renewal options for  consecutive terms of one year  each
  through December 31, 1998. SSG exercised its first three renewal options,
  and currently is permitted to use the AMF name through December 31, 1998.
  The Company  is in  the  process of  renegotiating  an extension  to  the
  agreement, but no assurance can be made that such renegotiations will  be
  successful.
<PAGE>
       On December  15,  1995,  the  Company  entered  into  a  three  year
  agreement with  Little League  Baseball, Incorporated  that, among  other
  things, names  the  Company as  the  "Official Factory  Direct  Equipment
  Supplier of Little League Baseball."  On August 15, 1997, the Company and
  Little League  Baseball  extended the  expiration  of this  agreement  to
  December 31, 2001.  The Company is required to pay an annual fee to  keep
  the agreement in effect each year.

       In addition  to the  foregoing, the  Company  has acquired  (or  had
  issued) a number  of patents relating  to products sold  by the  Company.
  The following is a list of some of the patents owned by the Company:  (i)
  2 separate patents  relating to  a Power  Squat/Weight Lifting  Apparatus
  (expire May  20, 2003  and June  23, 2004,  respectively); (ii)  Baseball
  Hitting Practice Device (expires May 9,  2006); (iii) 2 separate  patents
  relating to Football Digital  Display Markers (expire  June 27, 2006  and
  November 28, 2006, respectively);  (iv) Tennis Net  and Method of  Making
  (expires October 1, 2008);  (v)  Rotator  Cuff Exercise Machine  (expires
  January 29, 2008); (vi)  Portable Balance Beam  (expires July 28,  2009);
  and (vii)  Holder for Beverage Containers (expires August 16, 2011).

  Sales and Marketing


       The Company  markets its  products  through five  primary  marketing
  divisions: 1) Sport Supply Group; 2) U.S.  Games;  3)  The Athletic 
  Connection;  4) Youth  Sports;  and 5) Athletic Training Equipment Company.

       The Sport Supply Group marketing division markets SSG's products  to
  institutional customers through catalogs, outbound telemarketing, and bid
  related sales efforts.  SSG publishes  two primary catalogs designed  for
  institutional  customers:  BSN[R]  Sports,  and  New  England  Camp   and
  Recreation. Master catalogs containing a  broad variety of the  Company's
  products are  sent  to  all customers  and  potential  customers  on  the
  Company's mailing lists.  Seasonal or specialty supplements are  prepared
  and mailed periodically  to certain accounts  that pertain to  particular
  sports, such  as weight  training,  baseball or  track  and field.    SSG
  services its existing accounts and solicits new customers with a total of
  over 2.0 million pieces  of mail each  year, including approximately  1.8
  million catalogs.

       The Company's mailing lists, developed over 20 years, are maintained
  and updated by the Company periodically.   SSG frequently buys and  rents
  lists that it  attempts to screen,  improve, and  cross reference  before
  incorporating them into the  Company's master list.   The master list  is
  subdivided into various  combinations designed to  place catalogs in  the
  hands of individuals who make purchasing  decisions.  The master list  is
  also  subdivided  by  relevant  product  types,  seasons,  and   customer
  profiles.
<PAGE>
       While SSG maintains  a strong institutional  customer base in  rural
  and  small  metropolitan  areas,  the  institutional  markets  in   large
  metropolitan areas  have historically  been dominated  by local  sporting
  goods dealers and retailers.  Over the last several years, there has been
  a growing  trend  of  large  metropolitan  area  school  districts,  city
  recreation  departments,  and  other  institutions  submitting   proposed
  purchases through  competitive bids.   In  response  to this  trend,  SSG
  intensified its bid related sales efforts  by having its Metro  Marketing
  Group target large metropolitan area school districts and institutions in
  an effort  to  include  SSG's  products  among  those  specified  on  bid
  invitations.

       The U.S. Games marketing division was established to market  certain
  of the Company's products to elementary schools and the preschool market.

       The Athletic Connection marketing  division was established in  1992
  to market certain of the Company's products, principally MacGregor  brand
  products, to sporting goods team dealers  who also market these  products
  to institutional  customers and  teams.   Products are  marketed  through
  catalogs mailed to  team dealers  as opposed  to institutional  customers
  targeted by the Sport Supply Group marketing division.

       The Youth  Sports marketing  division concentrates  on selling  team
  sports products to independent youth  leagues. The Youth Sports  division
  utilizes outbound telemarketing, outside salesmen and a master catalog in
  conjunction with a supplier contract with Little League Baseball, Inc. to
  reach this marketplace.   In  addition to   equipment  and uniforms,  the
  Youth Sports division also  provides fund raising products.   On May  15,
  1996, SSG entered into a five-year Advertising and Distribution Agreement
  with Hershey Chocolate U.S.A.  Pursuant to this Agreement, SSG advertises
  and distributes  promotional  materials featuring  Hershey  fund  raising
  programs and products to  youth sports leagues and  teams and also  sells
  Hershey Chocolate  products to its customers.  The Youth Sports  division
  has entered  into Promotional  Agreements  with Lever  Brothers,  Warner-
  Lambert (Bubbilicious),  and  Major  League  Baseball  in  an  effort  to
  leverage  SSG's  direct  marketing  and  distribution  network.     These
  relationships help offset marketing costs and create valuable  brand-name
  recognition.

       During  December  1997,  the  Company  acquired  Athletic   Training
  Equipment Company, Inc. ("ATEC").  ATEC manufactures and markets pitching
  machines and other baseball training equipment to sporting goods  dealers
  and other sporting  goods channels.   These products  are marketed  using
  catalogs and outside salesmen to service the local dealers.  ATEC has one
  of the  broadest and  most versatile  line of  pitching machines  in  the
  market today, and with the use of the latest technology, has continued to
  meet the training needs of professional, college, high school, and  youth
  baseball and softball leagues.
<PAGE>
  Customers

       The Company's revenues are not dependent upon any one or a few major
  customers.  Instead, the Company enjoys a very large and diverse customer
  base.  The Company's customers include  all levels of public and  private
  schools, colleges,  universities and  military academies,  municipal  and
  governmental  agencies,  military  facilities,  churches,  clubs,  camps,
  hospitals, youth sports leagues, non-profit organizations, team  dealers,
  and certain  large  retail  sporting goods  chains.    SSG  believes  its
  customer base in the  United States is the  largest in the  institutional
  direct  mail  market  for  sports  related  equipment.    The   Company's
  institutional  customers  typically  receive  annual  appropriations  for
  sports related equipment, which appropriations are generally spent in the
  period preceding  the season  in which  the  sport or  athletic  activity
  occurs.   While  institutions are  subject  to budget  constraints,  once
  allocations  have  been  made,  aggregate  levels  of  expenditures   are
  typically not reduced.

       Approximately 7%, 7%, and 8% of the Company's sales in fiscal  1998,
  1997 (which consisted of  the eleven months  ending September 26,  1997),
  and 1996 respectively, were to the  United States Government, a  majority
  of which sales were to military  installations.  SSG has a contract  with
  the General Services Administration (the "GSA Contract") that grants  the
  Company an "approved" status  when attempting to  make sales to  military
  installations or other governmental agencies.  The existing GSA  Contract
  expires in December 2001. Under the  GSA Contract, the Company agrees  to
  sell approximately 700 products to United States Government agencies  and
  departments at catalog prices or at  prices consistent with any  discount
  provided to other customers of the Company.  Products sold to the  United
  States Government under the GSA Contract are always sold at the Company's
  lowest offered price.  The Company  also has a contract with the  General
  Services Administration for  the sale  of approximately  40 camp  related
  products with terms similar to the  GSA Contract.  This contract  expires
  in August 2002.

       SSG also sells products  not covered by the  GSA Contract to  United
  States Government  customers,  although  the  appropriation  process  for
  purchases of these products differs. These sales are made through a  U.S.
  Government non-appropriated fund contract.  This contract is administered
  by the United States  Air Force and is  scheduled to expire on  September
  30, 1999.  See Note 6  to the consolidated financial statements  included
  in Item 8. -- "Financial Statements and Supplementary Data."

  Seasonal Factors and Backlog

       Historically, SSG's revenues have peaked in  the second,  third  and
  fourth fiscal quarters of each year due primarily to the seasonal  demand
  for product offered by the Company.   Less revenues are generated in  the
  fourth calendar  quarter  because  of the  reduced  demand  arising  from
  decreased  sports  activities,  adverse  weather  conditions   inhibiting
  customer demand, holiday seasons and school recesses.  See Note 13 to the
  consolidated financial  statements  included  in Item  8.  --  "Financial
  Statements and Supplementary Data."

       SSG  had  a  backlog  for  continuing  operations  of  approximately
  $2,433,000 at October 2, 1998, compared  to approximately  $2,526,000  at
  September 26, 1997.
<PAGE>
  Manufacturing and Suppliers

       The Company  manufactures, assembles,  and distributes  many of  its
  products at  its five  facilities.   See Item  2. --  "Properties."  Game
  tables,  gym  mats,  netting,  and  tennis  and  baseball  equipment  are
  manufactured in the Company's two  Anniston, Alabama plants.   Gymnastics
  equipment is  manufactured at  SSG's  facility in  Cerritos,  California.
  Baseball and softball pitching machines  are manufactured at SSG's  newly
  acquired  facility  in  Reno,  Nevada.    Items  of  steel  and  aluminum
  construction, such as  soccer field equipment  and weight equipment,  are
  principally manufactured at SSG's facilities in Farmers Branch, Texas.

       Certain products manufactured by  the Company are custom-made  (such
  as tumbling mats ordered in color  or size specifications), while  others
  are standardized.   The principal raw  materials used by  the Company  in
  manufacturing are,  for the  most part,  readily available  from  several
  different sources.  Such raw materials include foam, vinyl, nylon thread,
  steel and  aluminum tubing,  wood, slate,  and cloth.   Except  as  noted
  above, items not manufactured by SSG are purchased from various suppliers
  primarily located in the United States,  the Republic of China  (Taiwan),
  South Korea, Australia, the Philippines, Thailand, the People's  Republic
  of China,  Pakistan,  and  Germany.   SSG  has  no  significant  purchase
  contracts with any major supplier of finished products, and most products
  purchased from suppliers are readily available  from other sources.   The
  Company purchases most  of its finished  product in U.S.  dollars and  is
  therefore not subject to exchange rate differences.

  Competition

       SSG competes  in the  institutional  market principally  with  local
  sporting goods dealers,  retail sporting goods  stores, and other  direct
  catalogue sporting goods companies.  These competitors occasionally  fill
  institutional orders with Company products.   The Company has  identified
  approximately 15 other direct mail companies in the institutional market.
  SSG believes that  most of  these competitors  are substantially  smaller
  than SSG in terms of geographic coverage, products, and revenues.

       The Company competes in the institutional market principally on  the
  basis of brand,  price, product  availability and  customer service.  SSG
  believes it has an advantage in the institutional market over traditional
  sporting goods retailers and team dealers  because its selling prices  do
  not  include  comparable  price  markups  attributable  to   wholesalers,
  manufacturers, and/or distributors.   In addition, the Company's  ability
  to control  the  availability of  goods  it manufactures  enables  it  to
  respond more rapidly to  customer demand.  SSG  believes its direct  mail
  competitors operate  primarily  as  wholesalers  and  distributors,  with
  little or no manufacturing capability.

  Government Regulation

       Many of the Company's products are  subject to 15 U.S.C.A.  SS 2051-
  2084 (1998 and Supp. 1998), among other laws, which empowers the Consumer
  Product  Safety  Commission  (the  "CPSC")  to  protect  consumers   from
  hazardous sporting goods and other articles.  The CPSC has the  authority
  to exclude  from  the  market  certain articles  that  are  found  to  be
  hazardous and can require a manufacturer to refund the purchase price  of
  products that present a substantial product hazard.  CPSC  determinations
  are subject  to court  review.   Similar laws  exist in  some states  and
  cities in the United States.
<PAGE>
  Product Liability and Insurance

       Because of the nature of the Company's products, SSG is periodically
  subject to  product liability  claims resulting  from personal  injuries.
  The Company from  time to time  may become involved  in various  lawsuits
  incidental to the Company's business, some of which will relate to claims
  of injuries  allegedly  resulting  in  substantial  permanent  paralysis.
  Significantly increased product liability claims continue to be  asserted
  successfully against manufacturers and distributors throughout the United
  States resulting in general  uncertainty as to the  nature and extent  of
  manufacturers' and distributors'  liability for personal  injuries.   See
  Item 3 -- "Legal Proceedings."

       There can  be  no  assurance  that  the  Company's  general  product
  liability insurance will  be sufficient to  cover any successful  product
  liability claims made against the  Company. In management's opinion,  any
  ultimate liability  arising out  of currently  pending product  liability
  claims will not have a material adverse effect on the Company's financial
  condition or results of operations. However, any claims substantially  in
  excess of the Company's insurance coverage, or any substantial claim  not
  covered by  insurance,  could  have a  material  adverse  effect  on  the
  Company's results of operations and financial condition.

  Employees

       On October 2, 1998, SSG had approximately 425 full-time employees in
  its core  institutional  business,  174 of  whom  were  involved  in  the
  Company's  manufacturing  operations.    SSG  also  hires  part-time  and
  temporary employees  primarily during  the summer  months.   None of  the
  Company's employees are represented by a union, and the Company  believes
  its relations with employees is good.

                      EXECUTIVE OFFICERS OF THE COMPANY

                                                           Year
                                                           First
                                                          Became
          Name          Age       Present Position        Officer
          ----          ---       ----------------        -------
  Geoffrey P. Jurick    58   Chairman of the Board and     1996
                             Chief Executive Officer

  John P. Walker        35   President, Chief Operating    1996
                             Officer and Chief Financial
                             Officer

  Terrence M. Babilla   36   Executive Vice President,     1995
                             General Counsel and
                             Secretary

  Adam L.Blumenfeld     28   Vice President of Sales       1998
                             and Marketing

  All officers are elected for a term of one year or until their successors
                              are duly elected.

<PAGE>
  Item 2.   Properties.

       The Company leases (i) a 135,000 square foot corporate  headquarters
  and manufacturing facility and     (ii)  a 181,000 square foot  warehouse
  facility, each of which is located in Farmers Branch, Texas.  The 135,000
  square foot facility is under a lease expiring in July 2001.  The 181,000
  square foot  warehouse facility  is under  a lease  expiring in  December
  2004, with two (2) five year renewal options.  The Company also leases  a
  45,000  square  foot  gymnastics  equipment  manufacturing  facility   in
  Cerritos, California which expires in December 2001, and a 50,000  square
  foot pitching  machine  manufacturing  facility  in  Reno,  Nevada  which
  expires in June 1999.

       The Company owns (i) a 35,000  square foot foam product and  netting
  manufacturing  plant  and   (ii)  a   45,000  square   foot  game   table
  manufacturing plant, both of which are located in Anniston, Alabama.

  Item 3.   Legal Proceedings.

       The Company from time to time becomes involved in various claims and
  lawsuits incidental  to  its  business.   In  management's  opinion,  any
  ultimate liability  arising out  of currently  pending product  liability
  claims will not have a material adverse effect on the Company's financial
  condition or results of operations.  However, any claims substantially in
  excess of the Company's insurance coverage, or any substantial claim  not
  covered by  insurance,  could  have a  material  adverse  effect  on  the
  Company's results of operations and  financial condition. See Item 1.  --
  "Business -- Product Liability and Insurance."

       On September 29, 1997,  the Company terminated  Mr. Eugene Davis  as
  Vice Chairman and a Consultant and  requested that Mr. Davis resign as  a
  director of the Company.  The circumstances surrounding such  termination
  are the subject of two proceedings.   On September 30, 1997, the  Company
  filed a complaint in  the United States District  Court for the  Northern
  District of  Texas, Dallas  Division, seeking  a  declaration as  to  the
  existence of  an alleged  consulting agreement  and as  to the  Company's
  continuing obligations to make  payments to Mr.  Davis.  Thereafter,  Mr.
  Davis filed a complaint in the Law Division of the Superior Court of  New
  Jersey, against the Company for breach of an alleged consulting agreement
  and against certain  officers of  the Company  for tortious  interference
  with contractual relationships.  The Company intends to vigorously defend
  itself and the individual defendants against Mr. Davis' complaint.

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

       Not Applicable.
<PAGE>
                                  PART II.

  Item 5.   Market for Registrant's Common  Equity and Related  Stockholder
  Matters.

       SSG's common stock, par value $.01 per share (the "Common Stock") is
  traded on the  New York Stock  Exchange, Inc. ("NYSE")  under the  symbol
  GYM.  SSG's Common Stock Purchase  Warrants, which were distributed as  a
  special dividend to the Company's stockholders on December 27, 1993  (the
  "1993 Warrants"),  are  traded  on  the  American  Stock  Exchange,  Inc.
  ("AMEX") under  the symbol  GYMW.   The 1993  Warrants are  scheduled  to
  expire on December 15, 1998.   As of November  5, 1998, there were  3,908
  holders of  the  Common  Stock (including  individual  security  position
  listings).  The  following table  sets forth  the range  for the  periods
  indicated of the high and low sales  prices for the Common Stock and  the
  1993 Warrants (after giving effect to the 5 for 4 stock split declared by
  the Company  on January  26, 1994).    There is  no fourth  quarter  1997
  information set forth in the following table due to the Company's  change
  in its fiscal year end from October 31 to September 30.

                            Common Stock          1993 Warrants
                          High        Low        High       Low
                          ----        ---        ----       ---
  1997       First        6-7/8      4-5/8       5/16       1/16
             Quarter
             Second       6-1/2      5-1/8       5/16       1/64
             Quarter
             Third        8-7/8      5-3/8       1/8        1/32
             Quarter

  1998       First        8-1/2      6-1/8       5/32       1/32
             Quarter
             Second       9-7/8      7-1/4       1/32       1/32
             Quarter
             Third       10-1/4      8-1/8       1/16       1/16
             Quarter
             Fourth      9-15/16     6-7/8       N/A*       N/A*
             Quarter

            * No trading activity this quarter

       The Company currently intends to retain any earnings for use in  its
  business and does not anticipate paying any cash dividends on its capital
  stock in the foreseeable future.

       On January 14, 1998, the Company  issued 50,000 shares of  restricted
  stock to  John  P.  Walker, President,  Chief  Operating  Officer,  Chief
  Financial Officer, and director of the Company in a privately  negotiated
  transaction pursuant to Section  4(2) of the Securities  Act of 1933,  as
  amended (i.e.,  a  transaction  by  an  issuer  not  involving  a  public
  offering).  One third of these shares vested immediately and the remaining
  shares are scheduled to vest in twenty-four equal monthly installments 
  beginning February 15, 1998.  The Company  did not receive any cash proceeds 
  from the issuances of these shares.
<PAGE>
       On May  28, 1997,  the  Company approved  the  repurchase of  up  to
  1,000,000 shares of its issued and  outstanding common stock in the  open
  market and/or  privately negotiated  transactions.   Such  purchases  are
  subject to price and availability of shares, working capital availability
  and any alternative  capital spending  programs of  the Company.   As  of
  October 2, 1998, the Company had repurchased approximately 721,000 of its
  issued and  outstanding common  stock in  the open  market and  privately
  negotiated transactions.   On October 28,  1998, the  Company approved  a
  second repurchase program of up to an additional 1,000,000 shares of  its
  issued and outstanding common stock in  the open market and/or  privately
  negotiated transactions.  Again, such purchases are subject to price  and
  availability of shares, working capital availability and any  alternative
  capital spending programs of the Company.


  Item 6.   Selected Financial Data.

       The following tables set forth certain historical financial data for
  the Company.  The historical  financial data  has been  derived from  the
  audited financial statements of the Company.   The historical data  below
  should be read  in conjunction with  Item 7. -- "Management's  Discussion
  and Analysis of Financial  Condition and Results  of Operations" and  the
  Company's financial statements and notes thereto  included in Item 8.  --
  "Financial Statements and Supplementary Data."
<PAGE>
<TABLE>
                          SELECTED FINANCIAL DATA (4)
                (Amounts in thousands, except per share amounts)


                                                 Eleven
                                       Year      Months     Year     Ten Months
                                       Ended     Ended      Ended       Ended    Year Ended
                                       Oct. 2    Sep. 26    Nov. 1     Oct. 31    Dec. 31
                                        1998      1997      1996         1995       1994
                                        ----      ----      ----         ----       ----
<S>                                   <C>        <C>       <C>         <C>        <C>
Statement of Earnings Data:
Net revenues                          $97,292    $79,109   $80,521     $65,134    $66,920
Gross profit                           37,726     31,404    29,955      25,259     26,326
Operating profit (loss)                 7,157      4,226       (65)      3,894      5,162
Interest expense                          474        757     1,372       1,126        973
Other income (expense), net               841         83        38         209         (5)
Earnings (loss) from continuing
     operations                         4,964      2,576      (964)      1,847      2,802
Earnings (loss) from discontinued 
     operations                           --      (2,574)  (17,773)       (457)     1,900
 Net earnings (loss)                    4,964          2   (18,737)      1,390      4,702
Net earnings (loss) per common share
     from continuing operations(1)       0.62       0.32     (0.14)       0.27       0.43
Net earnings (loss) per common share
     from discontinued operations(1)(3)   --       (0.32)    (2.64)      (0.07)      0.29
Net earnings (loss) per common share(1)  0.62       0.00     (2.78)       0.20       0.72
Net earnings (loss) per common share
     from continuing operations-
     assuming dilution(1)                0.60       0.32     (0.14)       0.27       0.42
Net earnings (loss) per common share
     from discontinued operations-
     assuming dilution(1)(3)              --       (0.32)    (2.63)      (0.07)      0.28
Net earnings (loss) per common share-
     assuming dilution (1)              $0.60      $0.00    $(2.77)      $0.20      $0.70
Weighted average common shares
    outstanding(1)                      8,026      8,146     6,747       6,941      6,490
Weighted average common shares
    Outstanding _ assuming dilution(1)  8,237      8,151     6,768       6,950      6,760
Cash dividends declared per
    common share (2)                      --         --        --       $  .12    $   .13



                                     At Oct. 2  At Sept. 26  At Nov. 1  At Oct. 31  At Dec. 31
  Balance Sheet Data:                  1998       1997        1996        1995        1994
                                       ----       ----        ----        ----        ----
  <S>                                   <C>         <C>         <C>         <C>     <C>
  Working capital                     $25,245    $24,006     $21,322     $42,231     $32,886
  Total assets                         54,804     50,484      70,009      86,355      71,616   
  Long-term obligations, net            5,161      4,418      24,338      29,199      16,698
  Total liabilities                    13,626     11,527      40,846      38,745      25,143
  Stockholders' equity                 41,178     38,957      29,163      47,610      46,473

</TABLE>
<PAGE>
  (1)       Reflects the 5 for 4 stock split declared during January, 1994.
  (2)       Dividends declared  in  1995 consisted  of  a $0.03  per  share
  dividend for  the  first three  quarters.   Dividends  declared  in  1994
  consisted  of a  $0.04  per share dividend for the fourth quarter of 1993
  and a $0.03 per share dividend for the first, second  and third  quarters
  of 1994.
  (3)       See Note 10 to  the consolidated financial statements  included
  in Item 8. _ "Financial Statements and Supplementary Data."
  (4)    During 1995, the Company changed its financial reporting year  end
  from December 31  to October  31.   Consequently, the  fiscal year  ended
  October 31,  1995  is a  transition  period consisting  of  ten  calendar
  months.  During 1997,  the Company changed  its financial reporting  year
  end from October 31  to September 30.   Therefore, the fiscal year  ended
  September 26, 1997 is a transition  period consisting of eleven  calendar
  months.


  Item 7.   Management's Discussion and Analysis of Financial Condition and
  Results of Operations.

       The following table sets forth,  for the periods indicated,  certain
  items related to the Company's continuing  operations as a percentage  of
  net revenues.  During 1997, the  Company changed its financial  reporting
  year end from  October 31  to September  30. Therefore,  the fiscal  year
  ended September  26, 1997  is a  transition period  consisting of  eleven
  calendar months.  See Note  1 to  the consolidated  financial  statements
  included in Item 8. _ "Financial Statements and Supplementary Data".

                                         For the       For the      For the
                                        12 Months     11 Months    12 Months
                                         Ended         Ended         Ended
                                         Oct. 2,      Sep. 26,      Nov. 1,
                                          1998          1997         1996
                                          ----          ----         ----
  Net revenues (in thousands)           $97,292       $79,109      $80,521
                                         100.0%        100.0%       100.0%
  Cost of sales                           61.2%         60.3%        62.8%
  Selling, general and administrative
      Expenses                            30.2%         32.7%        37.3%
                                          ----          ----         ----
  Operating profit (loss)                  7.7%          5.3%        (0.1)%
                                          ====          ====         ====


<PAGE>
       In May 1996, the Company sold substantially all of the assets of its
  Gold  Eagle  Professional  Golf   Products  Division  ("the  Gold   Eagle
  Division") and approved a formal plan to dispose of its remaining  retail
  segment operations comprised of golf balls and golf related  accessories.
  In March 1997, the Company sold its remaining retail segment  operations.
  See Note 10 to the consolidated financial statements included in Item  8.
  _ "Financial  Statements  and Supplementary  Data".   As  a  result,  the
  accompanying  consolidated  financial  statements  present  SSG's  retail
  segment as a discontinued operation through the date of disposal.  Due to
  the change in the Company's fiscal year end from October 31 to  September
  30, the fiscal year ended September 26,  1997 is comprised only of an  11
  month period. Therefore, certain financial data for 1998, 1997, and  1996
  presented within this section also includes (where indicated) comparative
  information relative to the  twelve months ended  September 26, 1997  and
  the  eleven  months  ended  September  30,  1996  (which  information  is
  unaudited)  to  provide  a  more  meaningful  discussion  of   comparable
  operating results.  The following  discussion regarding 1998 as  compared
  to 1997 and 1997 as compared to 1996, unless otherwise indicated, relates
  to the Company's continuing operations only.

  1998 Compared to 1997

  The following table summarizes certain financial information relating  to
  the Company's  results  of continuing  operations  for the  twelve  month
  period ended October  2, 1998  and the comparable twelve month period  of
  1997:

                                                   1997
                                  1998          (unaudited)
                                 ----------      ----------
         Net Revenues           $97,291,991     $86,025,581
         Gross Profit           $37,726,176     $33,248,371
         SG&A                   $29,385,623     $29,482,847
         Net Earnings            $4,964,311      $1,306,699


  Net Revenues.   Net revenues for  the fiscal year  ended October 2,  1998
  increased by  approximately  $18.2 million  (23.0%)  as compared  to  the
  eleven month  period ended  September 26,  1997.   Net revenues  for  the
  fiscal year  ended  October  2, 1998  increased  by  approximately  $11.3
  million (13.1%) as compared to the  twelve month comparable period  ended
  September 26, 1997.  The increase  in net revenues reflects increases  in
  revenues associated primarily with the  Company's Youth, U.S. Games,  and
  track and field divisions as well as the Company's new subsidiary,  ATEC,
  which was acquired on December 1,  1997.  These increases were  partially
  offset by  a  decrease  in Government  sales.    If  government  spending
  continues to  be  reduced, the  Company  will continue  to  experience  a
  decrease in government sales in future  periods.  Net revenues were  also
  adversely impacted because the Company mailed significantly less catalogs
  to its customers after consolidating the BSN, GSC, and Passons'  catalogs
  into one  catalog.    The benefits  from  reducing  catalog  and  postage
  expenses are  reflected  in  the  "Selling,  General  and  Administrative
  Expenses."  The Company is constantly reviewing its marketing methods  to
  maximize revenue growth and minimize expenses.   As a result of the  ATEC
  acquisition, the  Company  expects to  experience  an increase  in  sales
  related to sporting goods dealers and retailers.
<PAGE>
  Gross Profit.   Gross  profit for the fiscal  year ended October 2,  1998
  increased by approximately $6.3 million (20.1%) as compared to the eleven
  month period  ended  September  26, 1997  and  $4.5  million  (13.5%)  as
  compared to  the twelve  month period  ended September  26, 1997.   As  a
  percentage of net revenues, gross profit decreased to 38.8% in 1998  from
  39.7% for the fiscal year ended September  26, 1997 as a result of  sales
  related to ATEC and the Youth division, as such sales have lower  margins
  than other  sales within  the  Company's business.    In the  event  that
  revenues related to ATEC and the  Youth division continue to represent  a
  larger percentage  of  total  revenues,  the  Company  may  experience  a
  decrease in  gross profit  as  a percentage  of  net revenues  in  future
  periods.

  Selling, General  and  Administrative  Expenses.   Selling,  general  and
  administrative expenses  for  the  fiscal  year  ended  October  2,  1998
  increased by approximately $3.5 million (13.6%) as compared to the eleven
  month period ended  September 26, 1997  and decreased  $97,000 (0.3%)  as
  compared to  the twelve  month period  ended September  26, 1997.   As  a
  percentage of net  revenues, operating expenses  decreased from 32.7%  to
  30.2% for the fiscal year ended October 2, 1998 as compared to the fiscal
  year ended  September 26,  1997.   The decrease  in these  expenses as  a
  percentage of net revenues was primarily due to the following factors:

  (i)    A  decrease  in catalog  expenses  associated with  the  Company's
    consolidation of the BSN, GSC, and Passons' catalogs.

  (ii) A  decrease  in  bad debt  expense  associated  with  the  Company's
    successful  collection  efforts   and  better  credit  evaluations   of
    potential customers.

  The decrease in  operating expenses,  as discussed  above, was  partially
  offset by  the additional  operating expenses  associated with  Company's
  acquisition of ATEC.  As the Company completes its system  implementation
  project and begins amortization of the capitalized costs associated  with
  the project,  the Company  will experience  an  increase in  general  and
  administrative costs related to amortization.  The Company anticipates
  amortizing the capitalized costs associated with the project beginning in
  May, 1999.  The 1999 effect of the amortization is expected to be 
  approximately $300,000.  See Item 7 - "Management's Discussion and Analysis
  of Financial Condition and Results of Operations - Impact of year 2000
  and System Implementation."

  Nonrecurring Charges.  The Company recorded a nonrecurring pre-tax charge
  of approximately $1.2 million  in the fourth quarter  of the fiscal  year
  ended  October  2,  1998  for  compensation  payments  and  a  consulting
  agreement relating to the retirement  of Peter Blumenfeld, President  and
  Chief Operating Officer of the Company.  The severance payments were paid
  upon his retirement, and  the consulting agreement  will be paid  through
  July, 2000.

  Operating Profit.    Operating  profit increased  by  approximately  $2.9
  million (69.3%) to  a profit  of   $7.2 million  in fiscal  year 1998  as
  compared to  the  eleven  month  period  ended  September  26,  1997  and
  increased by $4.7 million  as compared to the  twelve month period  ended
  September 26, 1997.   As a percentage of  net revenues, operating  profit
  increased to 7.4%  in fiscal  1998 from 5.3%  for the  fiscal year  ended
  September 26, 1997.  The increase in operating profit reflects the impact
  of the (i)  increase in  gross profit dollars  and (ii)  the decrease  in
  operating expenses as a percentage of revenues as discussed above.
<PAGE>
  Interest Expense.    Interest expense  decreased  approximately  $283,000
  (37.4%) to $474,000  in fiscal  1998 from  $757,000 for  the fiscal  year
  ended September  26, 1997  and by  $399,000 (45.7%)  as compared  to  the
  twelve month period ended September 26,  1997.  The decrease in  interest
  expense resulted from reduced interest  rates and overall reduced  levels
  of borrowings.  The Company anticipates borrowings under its Senior Secured
  Credit Facility will increase over the next twelve months as the Company 
  continues to purchase common stock under its stock buyback program and 
  incurs costs associated with its  system implementation project,  As a 
  result of increased borrowings in the future, the Company anticipates 
  interest expense will increase in future periods.  See Item 7, "Management
  Discussion and Analysis of Financial Condition and Results of Operations - 
  Liquidity and Capital Resources."

  Other Income,  Net.  Other  income increased  approximately  $758,000  in
  fiscal 1998 as compared to the  fiscal year ended September 26, 1997  and
  $759,000 as compared to the twelve month period ended September 26, 1997.
  The increase in other income resulted from promotional agreements entered
  into between  the Company  and certain  corporate  sponsors of  a  market
  segment.  Other income also included services provided to Emerson such as
  human  resources,  advertising,  warehousing/distribution,  and   banking
  functions as  provided in  a Management  Services Agreement  between  the
  Company and  Emerson  effective  May  1997.    See  Item  13  _  "Certain
  Relationships and  Related  Transactions".  As  promotional  agreements
  have currently expired, the Company anticipates a reduction in  other income.
  
  Provision  for Income  Taxes.  The provision  for income taxes  increased
  approximately $1.6 million to a provision of $2.6 million in fiscal  1998
  from a provision of $976,000 in fiscal 1997.  The Company's effective tax
  rate increased to 34.0% in  fiscal 1998 from 27.5%  in fiscal 1997.   See
  Note 4 to  the consolidated financial  statements included in  Item 8  --
  "Financial Statements and Supplementary Data".

  Earnings    from  Continuing   Operations.    Earnings  from   continuing
  operations increased approximately $2.4 million  to $5.0 million in  1998
  from $2.6 million in fiscal 1997 and increased approximately $3.7 million
  as compared to the twelve  month period ended September  26, 1997.  As  a
  percentage of the net  revenues, net earnings increased  to 5.1% in  1998
  from 3.3%  in fiscal  1997.   Earnings  per  share before  dilution  from
  continuing operations increased to $0.62 per share in 1998 from $0.32 per
  share in fiscal 1997.  The fiscal  year ended October 2, 1998 includes  a
  decrease of approximately 1.5% in weighted average shares outstanding.

  1997 Compared to 1996

  The following table summarizes certain financial information relating  to
  the Company's  results  of continuing  operations  for the  eleven  month
  period ended September 26, 1997 and the comparable eleven month period of
  1996:


                                                    1996
                                  1997           (unaudited)
                                ----------       ----------
         Net Revenues          $79,109,063      $73,604,273
         Gross Profit          $31,403,655      $28,110,058
         SG&A                  $25,877,428      $26,414,557
         Net Earnings           $2,576,000         $305,611

<PAGE>
  Net Revenues.  Net revenues for  the eleven month period ended  September
  26, 1997 decreased by  approximately $1.4 million  (1.8%) as compared  to
  the fiscal year ended November 1, 1996.  Net revenues for the eleven
  month period ended  September 26,  1997 increased  by approximately  $5.5
  million (7.5%) as compared  to the eleven  month comparable period  ended
  September 30, 1996.  The increase  in net revenues reflects increases  in
  revenues associated primarily with youth sports league customers.   These
  increases were partially offset by a  decrease in Government sales.   The
  Company's revenues  were also  adversely affected  by the  United  Parcel
  Services ("UPS") strike that occurred in August of 1997.  The Company was
  unable to ship the entire balance of its order backlog, which resulted in
  cancellation of some orders.

  Gross Profit.   Gross profit for the eleven month period ended  September
  26, 1997 increased by  approximately $1.4 million  (4.8%) as compared  to
  the fiscal  year ended  November  1, 1996  and  $3.3 million  (11.7%)  as
  compared to  the eleven  month period  ended September  30, 1996.   As  a
  percentage of net revenues, gross profit increased to 39.7% in 1997  from
  37.2% for the fiscal year ended November 1, 1996.  The dollar increase as
  well as the increase in gross profit as a percentage of net revenues  was
  primarily attributable to the  increase in sales  related to SSG's  youth
  league division.

  Selling, General  and  Administrative  Expenses.   Selling,  general  and
  administrative expenses for the eleven  month period ended September  26,
  1997 decreased by approximately $4.1 million  (13.8%) as compared to  the
  fiscal year ended November 1, 1996 and $537,000 (2.0%) as compared to the
  eleven month period  ended September 30,  1996.  As  a percentage of  net
  revenues, operating expenses decreased from 37.3% to 32.7% for the fiscal
  year ended  September 26,  1997  as compared  to  the fiscal  year  ended
  November 1, 1996.  The decrease in these expenses as a percentage of  net
  revenues was primarily due to the following factors:

  (i)     A  decrease in  bad debt  expense associated  with the  Company's
    successful collection efforts  and better credit evaluations  potential
    customers.

  (ii)   A decrease in expenses relating to the Company's participation  in
    the 1996 Olympic games, as all expenses       related to royalties  and
    travel were incurred and paid in fiscal year 1996.

  (iii) A decrease in depreciation and  amortization related to the  write-
    offs  of certain  software  and  forecasting systems  recorded  in  the
    fourth quarter of fiscal year 1996.

  (iv) A  decrease in  other  expenses such  as office  supplies,  postage,
    paper  and  forms, delivery  service,  and  telephone as  a  result  of
    management's  efforts  to reduce  overall  general  and  administrative
    expenses.

  These decreases in operating expenses were partially offset by additional
  freight costs  associated with  the  UPS strike  as  the Company  had  to
  utilize  other  more  expensive  carriers  in  order  to  ship  products.
  Operating expenses  were  also  offset by  the  increase  in  advertising
  expenses due  to  the  expansion  of  the  Company's  marketing  efforts,
  primarily expenses relating to catalogs mailed to customers.
<PAGE>
  Nonrecurring Charges.  A majority of  the nonrecurring pre-tax charge  of
  $1.3 million for the fiscal year ended September 26, 1997 related to  the
  "change in control"  of the Company  that occurred on  December 10,  1996
  (including  severance  payments  to  the  former  CEO  of   approximately
  $680,000).  The  change in  control was the  result of  a stock  purchase
  agreement with  Emerson.   As part  of the  agreement, Emerson  purchased
  1,600,000 shares of SSG common stock and 1,000,000 common stock  purchase
  warrants and caused a majority of the members of SSG's Board of Directors
  to consist of Emerson's designees.

  Operating Profit  (Loss).   Operating profit  increased by  approximately
  $4.3 million to a profit of  $4.2 million  in fiscal 1997 from a loss  of
  approximately $65,000  for the  fiscal year  ended November  1, 1996  and
  increased by $2.5 million  as compared to the  eleven month period  ended
  September 30, 1996.   As a percentage of  net revenues, operating  profit
  increased to 5.3% in  fiscal 1997 from (0.1%)  for the fiscal year  ended
  November 1,  1996.   The increase  in operating  profit, both  in  dollar
  amount and as a  percentage of net revenues,  reflects the impact of  the
  increase in gross profit percentages related to sales and the decrease in
  operating expenses as discussed above.

  Interest Expense.    Interest expense  decreased  approximately  $615,000
  (44.8%) to $757,000 in fiscal 1997 from $1.4 million for the fiscal  year
  ended November 1, 1996 and by $500,000 (39.7%) as compared to the  eleven
  month period ended September 30, 1996.  The decrease in interest  expense
  resulted from lower borrowing levels as  a result of the equity  infusion
  by Emerson and the  proceeds received from the  sale of the  discontinued
  operations.

  Other Income, Net. Other income increased approximately $45,000 in fiscal
  1997 as compared to the fiscal year ended November 1, 1996.  The increase
  in other income resulted from services provided to Emerson such as  human
  resources, advertising, warehousing/distribution,  and banking  functions
  as provided in a  Management Services Agreement  between the Company  and
  Emerson effective May  1997.  See  Item 13 _  "Certain Relationships  and
  Related Transactions".

  Provision (Benefit) for  Income Taxes.   The provision  for income  taxes
  increased approximately $1.4 million to a provision of $976,000 in fiscal
  1997 from a benefit of $436,000 in fiscal 1996.  The Company's  effective
  tax rate decreased  to 27.5% in  fiscal 1997 from  31.1% in fiscal  1996.
  See Note 4 to the consolidated financial statements included in Item 8 --
  "Financial Statements and Supplementary Data".

  Earnings  (Loss)  from  Continuing  Operations.    Earnings  (loss)  from
  continuing  operations  increased  approximately  $3.5  million  to  $2.6
  million in 1997 from a loss of $964,000 in fiscal 1996.  As a  percentage
  of the net revenues, net earnings increased  to 3.3% in 1997 from a  loss
  of 1.2%  in fiscal  1996.   Earnings  (loss)  per share  from  continuing
  operations increased to $.32 per share in 1997 from a loss of $(0.14) per
  share in fiscal 1996.  This reflects a 20.4% increase in weighted average
  shares outstanding related to the sale to Emerson of 1,600,000 shares  of
  SSG's newly-issued common stock offset by approximately 287,000 shares of
  its issued and outstanding common stock purchased in the open market.
<PAGE>
  Liquidity and Capital Resources

  The Company's working capital  increased approximately $1.2 million  during
  the fiscal year ended October 2, 1998, from $24.0 million at September  26,
  1997 to $25.2 million at October 2, 1998.  The increase in working  capital
  is primarily a result of: (i)  the inventory acquired from the  acquisition
  of ATEC in  December, 1997;  and   (ii) a  $2.7 million  increase in  trade
  receivables due to higher revenues.  This increase was partially offset  by
  a $1.7 million  decrease in federal  income tax receivable  as the  Company
  received its federal tax refund in the third quarter of fiscal 1998.

  As of October 2,  1998, the Company had  total borrowings under its  senior
  credit facility of approximately $5.4 million including a term loan of $1.0
  million which is payable in quarterly installments of principal and accrued
  interest of  $125,000  through October  31,  2000, outstanding  letters  of
  credit for foreign  purchases of inventory  of approximately $1.9  million,
  and availability  of approximately  $14.7 million.    The net  increase  of
  $787,000 in  borrowings under  the senior  credit facility  as compared  to
  September 26, 1997 reflects  the cash payment for  the ATEC acquisition  in
  December, 1997 and cash purchases of the Company's common stock in the open
  market offset  by the  federal  income tax  refund  received in  the  third
  quarter of fiscal 1998.

  On September  9,  1997, the  Company  entered  into a  Second  Amended  and
  Restated Loan and Security Agreement ("Agreement") which includes a  senior
  credit facility of $25,000,000  with a maturity date  of October 31,  2000.
  This Agreement provides for a revolving line of credit, a letter of  credit
  facility, a term loan, additional loans to be  made to SSG for the cost  of
  certain capital expenditures (up  to a maximum  of $4,000,000) and  reduced
  interest rates.    The Agreement  also  contains financial  and  net  worth
  covenants in addition to limits on capital expenditures.

  The Company believes it will satisfy its short-term and long-term liquidity
  needs from borrowings under its senior credit facility and cash flows  from
  operations.

  On  May  28, 1997, the Company  approved the repurchase of up to  1,000,000
  shares  of  its  issued and  outstanding common  stock in  the open  market
  and/or  privately  negotiated transactions.  Such purchases are subject  to
  price  and  availability  of shares, working  capital availability and  any
  alternative  capital  spending programs  of the Company.  As of October  2,
  1998,  the  Company had repurchased approximately 721,000 of its issued and
  outstanding  common   stock in  the open  market and  privately  negotiated
  transactions.   On  October  28,  1998,  the  Company   approved  a  second
  repurchase  program  of up to an additional 1,000,000 shares of its  issued
  and  outstanding  common  stock  in   the  open   market  and/or  privately
  negotiated  transactions.  Again, such  purchases are subject to price  and
  availability  of  shares, working capital availability and any  alternative
  capital  spending  programs  of the Company.   Except as  described in  the
  next   paragraph,  the   company  does  not  currently  have  any  material
  commitments for capital expenditures.
<PAGE>
  Impact of Year 2000 and System Implementation

  The Year 2000 issue is the result of computer programs being written  using
  two digits rather than four digits to define the applicable year.  Some  of
  the Company's  computer  programs  that have  time-sensitive  software  may
  recognize a date using  "00" as the  year 1900 rather  than the year  2000.
  This could result  in a failure  or miscalculation  causing disruptions  of
  operations, including the  inability to process  transactions or engage  in
  normal business activities.   The Company  has determined that  it will  be
  necessary to replace significant portions of  its software and hardware  so
  that its computer systems will function  properly with respect to dates  in
  the year 2000  and thereafter.   The Company expects  that with  successful
  conversions to new software  that are Year 2000  compatible, the Year  2000
  Issue will  pose  no  significant operational  problems  for  its  computer
  systems.    However,  if  such  conversions  are  not  made,  or  are   not
  successfully completed on a  timely basis, the Year  2000 issue and  system
  implementation could  have  a  material adverse  effect  on  the  Company's
  operations because there  are no other  viable alternatives or  contingency
  plans in place  for the  Company.  The  Company is  utilizing internal  and
  external resources to  convert to, test,  and implement  the new  software.
  The Company  anticipates  completing  the  Year  2000  project  and  system
  implementation during calendar year 1999.  The Company is in the process of
  implementing a new system  and has determined the  total estimated cost  of
  the system implementation project to range  between $3.5 and $4.5  million.
  The cost  of  the system  implementation  project will  be  funded  through
  operating cash  flows  and borrowings  under  the Company's  senior  credit
  facility.  The Company has currently  spent approximately $2.0 million  for
  the project and expects to be within  the original estimate at the date  of
  completion.  The majority of these  cost associated with the Year 2000  and
  system implementation project will be capitalized and amortized.

  The Company believes it is taking  all necessary steps to become Year  2000
  compliant; however, the Company's Year 2000 compliance is also dependent on
  the compliance of third parties such as vendors and customers.  Due to  the
  diversity and  volume  of  customers  and  vendors,  the  Company  can  not
  determine the full extent to which the Company may be affected if such Year
  2000 issues are not resolved by third parties.

  Certain Factors that May Affect the Company's Business or Future  Operating
  Results

  This report  contains various  forward looking  statements and  information
  that are based on Management's beliefs  as well as assumptions made by  and
  information currently available to Management.   When used in this  report,
  the  words  "anticipate",   "believe",  "estimate",  "expect",   "predict",
  "project", and similar expressions are intended to identify forward looking
  statements.  Such  statements are subject  to certain risks,  uncertainties
  and assumptions.   Should  one  or more  of  these risks  or  uncertainties
  materialize, or  should  underlying  assumptions  prove  incorrect,  actual
  results may vary materially from those anticipated, expected or  projected.
  Among the  key factors  that may  have a  direct bearing  on the  Company's
  results are set forth below.
<PAGE>
  Future trends for revenues and profitability  remain difficult to predict.
  The Company  continues to  face many  risks and  uncertainties, including:
  general and  specific market  economic  conditions, reduced  sales  to the
  United States Government due to reduction  in Government spending, risk of
  nonpayment  of  accounts  receivable,  competitive  factors,  and  foreign
  supplier related issues.

  The general economic  condition in  the U.S. could  affect pricing  on raw
  materials such as metals  and other commodities used  in the manufacturing
  of certain  products  as  well as  finished  goods.    Any  material price
  increases to the customer could have an adverse effect on revenues and any
  price increases from vendors could have an adverse effect on costs.

  Approximately 7% of the Company's institutional sales are made to the U.S.
  Government, a  majority  of  which  are  made  to  military installations.
  Anticipated reductions  in  U.S. Government  spending  could  reduce funds
  available to various  government customers  for sports  related equipment,
  which could adversely affect the Company's results of operations.

  The Company ships  approximately 80% of  its products  using United Parcel
  Service ("UPS").  As  experienced in 1997, a  strike by UPS or  any of its
  major carriers could adversely affect the  Company's results of operations
  due to not being able to deliver its products in a timely manner and using
  other more expensive freight carriers.   Although the Company has analyzed
  the cost benefit effect of using  other carriers, the Company continues to
  utilize UPS for the majority of its small package shipments.

  Management continues to closely monitor orders and the creditworthiness of
  its customers.   The  Company has  not  experienced abnormal  increases in
  losses  associated  with   accounts  receivable;   however,  credit  risks
  associated with the youth league division  and ATEC's retail customer base
  are considered by the Company to be greater  than any other division.  The
  Company has made allowances for  the amount it believes  to be adequate to
  properly reflect  the  risk to  accounts  receivable;  however, unforeseen
  market conditions may compel the Company to increase the allowances.

  The sports related equipment  market in which the  Company participates is
  highly competitive and  there are  no significant  barriers to  enter this
  market.  SSG competes  principally in the institutional  market with local
  sporting goods dealers, as well as other direct mail companies.

  The Company derives  a significant portion  of its revenues  from sales of
  products purchased directly  from foreign  suppliers located  primarily in
  the Far East.  In addition,  the Company believes many  of the products it
  purchases from domestic  suppliers are produced  by foreign manufacturers.
  The Company is subject to risks of doing business abroad, including delays
  in shipments, adverse  fluctuations in currency  exchange rates, increases
  in import duties, decreases  in quotas, changes in  custom regulations and
  political turmoil.   The occurrence  of any one  or more  of the foregoing
  could adversely affect the Company's operations.

  Advances and changes in available technology  can significantly impact the
  Company.   The  Year  2000 Issue  and  system  implementation  project (as
  described above) creates risks for the Company from unforeseen problems in
  its own computer  systems and  from third parties  with whom  the  Company
  deals on  a daily  basis.   Such  failures of  the Company's  and/or third
  parties' computer  systems could  have a  material  adverse impact  on the
  Company's ability to conduct its business.
<PAGE>
  Item 7A.  Quantitative and Qualitative Disclosures About Market Risk

          Not Applicable


  Item 8.   Financial Statements and Supplementary Data.


<PAGE>
  Sport Supply Group, Inc.

  Index to Financial Statements

                                                                    Page

  Report of Independent Auditors

  Consolidated Balance Sheets as of October 2, 1998 and
   September 26, 1997 

  Consolidated Statements of Operations for the Year Ended
   October 2, 1998, the Eleven Month Period Ended
   September 26, 1997, and the Year Ended November 1, 1996,  

  Consolidated Statements of Stockholders' Equity for
   the Year Ended October 2, 1998, the Eleven Month Period
   Ended September 26, 1997, and the Year Ended
   November 1, 1996                                 

  Consolidated Statements of Cash Flows for the Year Ended
   October 2, 1998, the Eleven Month Period Ended
   September 26, 1997, and for the Year Ended November 1, 1996

  Notes to Consolidated Financial Statements

  Financial statement schedules are omitted as the required information  is
  presented in the consolidated financial  statements or the notes  thereto
  or is not necessary.

<PAGE>


                        REPORT OF INDEPENDENT AUDITORS


  To the Board of Directors of Sport Supply Group, Inc.:

       We have  audited the  accompanying  consolidated balance  sheets  of
  Sport Supply  Group,  Inc. and  subsidiary  as  of October  2,  1998  and
  September  26,  1997,   and  the  related   consolidated  statements   of
  operations, stockholders'  equity,  and  cash flow  for  the  year  ended
  October 2, 1998, and  the eleven month period  ended September 26,  1997.
  These financial  statements  are  the  responsibility  of  the  Company's
  management.   Our  responsibility  is to  express  an  opinion  on  these
  financial statements based on our audits.

       We conducted  our  audits  in  accordance  with  generally  accepted
  auditing standards.  Those standards require that we plan and perform the
  audit  to  obtain  reasonable  assurance  about  whether  the   financial
  statements  are  free  of  material  misstatement.    An  audit  includes
  examining,  on  a  test  basis,  evidence  supporting  the  amounts   and
  disclosures  in  the  financial  statements.    An  audit  also  includes
  assessing the accounting principles  used and significant estimates  made
  by management,  as well  as evaluating  the overall  financial  statement
  presentation.  We believe that our audits provide a reasonable basis  for
  our opinion.

       In our opinion,  the consolidated financial  statements referred  to
  above  present  fairly,  in  all  material  respects,  the   consolidated
  financial position  of Sport  Supply Group,  Inc.  and subsidiary  as  of
  October 2, 1998 and September 26,  1997, and the consolidated results  of
  its operation and its cash  flow for the year  ended October 2, 1998  and
  the eleven  month period  ended September  26,  1997 in  conformity  with
  generally accepted accounting principles.
  
                                  ERNST & YOUNG LLP

  Dallas, Texas
  November  6, 1998

<PAGE>

                  REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

  To Sport Supply Group, Inc.:

       We have audited the accompanying consolidated statement of operations,
       stockholders' equity and cash flow of Sport Supply Group, Inc. (a 
       Delaware corporation) and subsidiary for the year ended November 1,
       1996.  These financial  statements  are  the  responsibility  of  
       the Company's management.   Our  responsibility  is to  express  an  
       opinion  on  these financial statements based on our audit.

       We  conducted  our  audit  in  accordance  with  generally  accepted
  auditing standards.  Those standards require that we plan and perform the
  audit  to  obtain  reasonable  assurance  about  whether  the   financial
  statements  are  free  of  material  misstatement.    An  audit  includes
  examining,  on  a  test  basis,  evidence  supporting  the  amounts   and
  disclosures  in  the  financial  statements.    An  audit  also  includes
  assessing the accounting principles  used and significant estimates  made
  by management,  as well  as evaluating  the overall  financial  statement
  presentation.  We believe that our audit provides a reasonable basis  for
  our opinion.

       In our opinion,  the consolidated financial  statements referred to
  above present fairly, in all material respects,  the results of Sport 
  Supply Group, Inc. and subsidiary's operations and their  cash  flow for 
  the year ended November 1, 1996, in conformity with generally  accepted 
  accounting principles.

                                  ARTHUR ANDERSEN LLP
  Dallas, Texas,
  January 29, 1997

<PAGE>
<TABLE>

                   SPORT SUPPLY GROUP, INC. AND SUBSIDIARY
                         CONSOLIDATED BALANCE SHEETS
                 AS OF OCTOBER 2, 1998 AND SEPTEMBER 26, 1997

<CAPTION>
                                                 October 2,  September 26,
                                                    1998         1997
                                                 ----------   ----------
<S>                                             <C>          <C>
CURRENT ASSETS :
    Cash                                        $ 1,035,466  $   602,779
    Accounts receivable --
        Trade, less allowance for doubtful
         accounts of $372,000 in 1998 and
         $797,000 in 1997                        16,151,371   13,452,286
        Other                                       572,234      467,661
    Income taxes receivable                             --     1,653,875
    Inventories, net                             14,102,837   12,284,425
    Other current assets                            943,521      583,414
    Deferred tax assets                             904,318    2,069,678
                                                 ----------   ----------
        Total current assets                     33,709,747   31,114,118
                                                 ----------   ----------
DEFERRED CATALOG EXPENSES                         1,916,035    1,150,514

PROPERTY, PLANT AND EQUIPMENT :
    Land                                              8,663        8,663
    Buildings                                     1,595,228    1,595,228
    Machinery and equipment                       5,585,710    5,661,315
    Furniture and fixtures                        2,683,122    2,427,527
    Leasehold improvements                        2,764,384    2,277,372
                                                 ----------   ----------
                                                 12,637,107   11,970,105
                                                 ----------   ----------
    Less -- Accumulated depreciation
     and amortization                            (7,574,023)  (6,638,319)
                                                 ----------   ----------
                                                  5,063,084    5,331,786
                                                 ----------   ----------
DEFERRED TAX ASSETS                               4,659,189    5,838,895

COST IN EXCESS OF TANGIBLE NET ASSETS ACQUIRED,
    less accumulated amortization of $1,240,000
    in 1998 and $1,130,000 in 1997                3,174,725    2,959,114

TRADEMARKS, less accumulated amortization of
    $1,136,000 in 1998 and $935,000 in 1997       3,163,290    3,364,046

OTHER ASSETS, less accumulated amortization of
    $994,000 in 1998 and $1,119,000 in 1997       3,117,545      725,624
                                                 ----------   ----------
                                                $54,803,615  $50,484,097
                                                 ==========   ==========
<PAGE>
CURRENT LIABILITIES :
    Accounts payable                            $ 6,178,080  $ 4,956,830
    Income taxes payable                             87,250          --
    Accrued property taxes                          218,201      294,882
    Other accrued liabilities                       893,598    1,292,247
    Notes payable and capital lease
     obligations, current portion                 1,087,809      564,638
                                                 ----------   ----------
                                                  8,464,938    7,108,597
                                                 ----------   ----------
DEFERRED GAIN                                            --       22,091
NOTES PAYABLE AND CAPITAL LEASE
    OBLIGATIONS, net of current portion           5,160,965    4,396,090

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY :
    Preferred stock, par value $0.01, 100,000
        shares authorized, no shares outstanding
        in 1998 or 1997                                  -            -
    Common stock, par value $0.01, 20,000,000
        shares authorized, 9,243,195 and
        9,158,749 shares issued in 1998 and
        1997, 7,754,703 and 8,084,384 shares
        outstanding in 1998 and 1997                 92,432       91,588
    Paid-in capital                              59,100,187   58,574,218
    Retained deficit                             (4,745,046)  (9,709,357)
    Treasury stock, at cost, 1,488,492 shares
        in 1998 and 1,074,365 shares in 1997    (13,269,861)  (9,999,130)
                                                 ----------   ----------
                                                 41,177,712   38,957,319
                                                 ----------   ----------
                                                $54,803,615  $50,484,097
                                                 ==========   ==========

The accompanying notes are an integral part of these financial statements.
</TABLE>
<PAGE>
<TABLE>

                   SPORT SUPPLY GROUP, INC. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF OPERATIONS
        For The Year Ended October 2, 1998, The Eleven Month Period Ended
         September 26, and The Year Ended November 1, 1996 (See Note 1)

<CAPTION>

                                              1998         1997         1996
                                           ----------   ----------   ----------
<S>                                       <C>          <C>          <C>
NET REVENUES                              $97,291,991  $79,109,063  $80,520,837

COST OF SALES                              59,565,815   47,705,408   50,566,008
                                           ----------   ----------   ----------
GROSS PROFIT                               37,726,176   31,403,655   29,954,829

SELLING, GENERAL AND ADMINISTRATIVE
  EXPENSES                                 29,385,623   25,877,428   30,019,994

NONRECURRING CHARGES                        1,184,024    1,300,000         --
                                           ----------   ----------   ----------
  Operating profit (loss)                   7,156,529    4,226,227      (65,165)

OTHER INCOME (EXPENSE):

  Interest expense                           (473,899)    (757,181)  (1,371,990)
  Other income, net                           840,763       82,523       37,962
                                           ----------   ----------   ----------
                                              366,864     (674,658)  (1,334,028)
  Earnings (loss) from continuing
    operations before (provision)
    benefit for income tax                  7,523,393    3,551,569   (1,399,193)

(PROVISION) BENEFIT FOR INCOME TAXES       (2,559,082)    (975,569)     435,536
                                           ----------   ----------   ----------
EARNINGS (LOSS) FROM CONTINUING OPERATIONS  4,964,311    2,576,000     (963,657)

DISCONTINUED OPERATIONS:

  Loss from operations, net of income tax         --           --    (2,242,143)
    benefit
  Loss on disposal, net of income tax
    benefit                                       --    (2,574,000) (15,530,697)
                                           ----------   ----------   ----------
  Loss from discontinued operations               --    (2,574,000) (17,772,840)
                                           ----------   ----------   ----------
NET EARNINGS (LOSS)                        $4,964,311   $    2,000  $(18,736,497)
                                           ==========   ==========   ==========
<PAGE>

EARNINGS (LOSS) PER COMMON AND
  COMMON EQUIVALENT SHARE:

  Continuing operations                         $0.62        $0.32       ($0.14)
  Discontinued operations                        --          (0.32)       (2.64)
                                           ----------   ----------   ----------
  Net earnings (loss)                           $0.62        $ --       ($2.78)
                                           ==========   ==========   ==========

  Continuing operations - assuming
    dilution                                    $0.60        $0.32       $(0.14)
  Discontinued operations - assuming
    dilution                                      --         (0.32)       (2.63)
                                           ----------   ----------   ----------
  Net earnings (loss) - assuming dilution       $0.60        $ --       $ (2.77)
                                           ==========   ==========   ==========

WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING                   8,025,606    8,146,074    6,746,788
                                           ==========   ==========   ==========

WEIGHTED AVERAGE NUMBER OF
  COMMON AND COMMON
  EQUIVALENT SHARES OUTSTANDING -
   ASSUMING DILUTION                        8,236,530    8,151,414    6,768,488
                                           ==========   ==========   ==========


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

</TABLE>
<PAGE>
<TABLE>
 
                   SPORT SUPPLY GROUP, INC. AND SUBSIDIARY
                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
For The Year Ended October 2, 1998, The Eleven Month Period Ended September 26, 1997,
                 And The Year Ended Novenber 1, 1996 (See Note 1)
                                                                                                              Unrealized
                                Common Stock    Preferred Stock   Paid in    Retained      Treasury Stock      Holding
                               Shares   Amount  Shares Amount     Capital    Earnings     Shares     Amount     Period     Total
                                                                             (Deficit)                        Gain (loss)
                              --------- ------- ------ ------ -----------  ----------    -------  ------------ ------- -----------
<S>                           <C>       <C>     <C>    <C>    <C>         <C>          <C>        <C>          <C>     <C>
Balance, October 31, 1995     7,551,337  75,513   --   $   -   46,649,095   9,025,140    829,664   (8,163,543)  23,760  47,609,965

Issuances of common stock
 upon exercises of
 outstanding stock options          562       6                     3,872                                                    3,878

Reissuances of treasury stock                                    (109,774)               (42,599)     419,157              309,383
Change in unrealized holding
 period gain (loss)                                                                                            (23,760)    (23,760)

Net loss                                                                  (18,736,497)                                 (18,736,497)
                              --------- ------- ------ ------ -----------  ----------    -------  ------------ ------- -----------
Balance, November 1, 1996     7,551,899 $75,519    --  $   -  $46,543,193 $(9,711,357)   787,065  $(7,744,386) $    -  $29,162,969
                              --------- ------- ------ ------ -----------  ----------    -------  ------------ ------- -----------
Issuances of common stock
 upon exercises of
 outstanding stock options        6,850      69                    47,025                                                   47,094

Issuances of common stock     1,600,000  16,000                11,984,000                                               12,000,000

Purchase of treasury stock                                                               287,300   (2,254,744)          (2,254,744)

Net earnings                                                                    2,000                                        2,000
                              --------- ------- ------ ------ -----------  ----------    -------  ------------ ------- -----------
Balance, September 26, 1997   9,158,749 $91,588    --  $   -  $58,574,218 $(9,709,357) 1,074,365  $(9,999,130) $    -  $38,957,319
                              --------- ------- ------ ------ -----------  ----------    -------  ------------ ------- -----------
Issuances of common stock
 upon exercises of 
 outstanding stock options       73,387     734                   502,370                                                  503,104

Issuances of common stock        11,059     110                    70,293                                                   70,403

Purchase of treasury stock                                                               433,725   (3,486,453)          (3,486,453)
                                                                                         
Reissuances of treasury shares                                    (46,694)               (19,598)     215,722              169,028

Net earnings                                                                4,964,311                                    4,964,311
                              --------- ------- ------ ------ -----------  ----------    -------  ------------ ------- -----------
Balance, October 2, 1998      9,243,195 $92,432    --  $   -  $59,100,187 $(4,745,046) 1,488,492 $(13,269,861) $    -  $41,177,712
                              --------- ------- ------ ------ -----------  ----------    -------  ------------ ------- -----------

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

</TABLE>
<PAGE>
<TABLE>
                    SPORT SUPPLY GROUP, INC. AND SUBSIDIARY
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
          For The Year Ended October 2, 1998, The Eleven Month Period
   Ended September 26, 1997, And The Year Ended November 1, 1996 (See Note 1)

                                                          1998         1997          1996
                                                        ---------   ----------   -----------
<S>                                                    <C>         <C>          <C>
CASH FLOWS FROM OPERATING ACTIVITIES :
 Net earnings (loss)                                   $4,964,311  $     2,000  $(18,736,497)
 Adjustments to reconcile net earnings (loss)
      to net cash provided by (used in)
      operating activities --
  Loss on disposal of discontinued operations              --        2,574,000    15,530,697
  Depreciation and amortization                         1,390,178    1,284,156     2,528,716
  Provision for (recovery of) allowances for
      accounts receivable                                (428,756)    (244,730)      895,716
  Changes in assets and liabilities --
   (Increase) decrease in receivables                     346,687   (2,010,346)     (330,706)
   (Increase) decrease in inventories                  (1,041,239)   3,036,080     1,309,650
   (Increase) decrease in deferred catalogs and
        other current assets                           (1,125,628)   1,533,535      (403,562)
   (Increase) decrease in current deferred tax assets   1,165,360    3,813,663    (3,756,306)
   Increase (decrease) in accounts payable              1,221,250   (5,036,219)    2,777,383
   Increase (decrease) in accrued liabilities            (688,080)    (589,994)      603,017
   (Increase) decrease in other assets                 (2,429,091)     (64,547)      313,305
   (Increase) decrease in noncurrent deferred tax asset 1,179,706   (1,346,048)   (4,755,852)
  Other                                                   (22,091)     (11,046)       (4,646)
  Discontinued operations - noncash charges and
   working capital changes                                  --        (697,524)   11,135,347
                                                        ---------   ----------   -----------
 Net cash provided by operating activities              4,532,607    2,242,980     7,106,262
                                                        ---------   ----------   -----------
CASH FLOWS FROM INVESTING ACTIVITIES :
 Acquisitions of property, plant and equipment           (569,342)    (155,439)     (631,562)
 Proceeds from sale of investments                         14,044        --            9,300
 Payments for acquisitions, net of cash acquired       (1,500,682)       --            --
 Investing activities of discontinued operations            --
 Proceeds from sale of discontinued operations              --                         --
                                                        ---------   ----------   -----------
 Net cash provided by (used in) investing activities   (2,055,980)   8,003,730       112,720
                                                        ---------   ----------   -----------
CASH FLOWS FROM FINANCING ACTIVITIES :
 Proceeds from issuances of notes payable               2,916,984    1,159,560     3,245,046
 Payments of notes payable and capital lease
      obligations                                      (2,217,006) (21,031,054)   (7,853,698)
 Proceeds from common stock issuances                     742,535   12,047,094         3,877
 Dividends paid to stockholders                            --           --          (201,650)
 Purchase of treasury stock                            (3,486,453)  (2,254,744)        --
 Financing activities of discontinued operations            --          --        (2,547,811)
                                                        ---------   ----------   -----------
 Net cash used in financing activities                 (2,043,940) (10,079,144)   (7,354,236)
                                                        ---------   ----------   -----------
Net change in cash                                        432,687      167,566      (135,254)
Cash, beginning of period                                 602,779      435,213       570,467
                                                        ---------   ----------   -----------
Cash, end of period                                    $1,035,466  $   602,779  $    435,213
                                                        =========   ==========   ===========
The accompanying notes are an integral part of these financial statements.
</TABLE>
<PAGE>
<TABLE>
                    SPORT SUPPLY GROUP, INC. AND SUBSIDIARY
                CONSOLIDATED STATEMENTS OF CASH FLOWS - CONTINUED
          For The Year Ended October 2, 1998, The Eleven Month Period
   Ended September 26, 1997, And The Year Ended November 1, 1996 (See Note 1)

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION :



                                                          1998        1997        1996
                                                        ---------   ----------   -----------
<S>                                                    <C>         <C>
Cash paid during the period for interest               $  502,414  $ 1,297,675  $  2,448,631
                                                        =========   ==========   ===========

Cash paid during the period for income taxes           $    6,671  $    10,825  $    134,735
                                                        =========   ==========   ===========

During 1998, the Company acquired the assets
     of an entity. In connection with the
     acquisition, liabilities were assumed as follows :

 Fair value of assets acquired                         $2,388,750       --            --
 Cash paid for the acquisition, net                    (1,500,682)      --            --
 Debt issued for the acquisition                         (588,068)      --            --
                                                        ---------   ----------   -----------
 Liabilities assumed                                     $300,000  $    --      $     --
                                                        =========   ==========   ===========

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

</TABLE>
<PAGE>
                  SPORT SUPPLY GROUP, INC. AND SUBSIDIARY
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                               October 2, 1998


  1.   BACKGROUND AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

  Background

  Sport Supply Group,  Inc. (the "Company"  or "SSG")  was incorporated  in
  1982.   The  assets  of  the  Sports  &  Recreation  Division  of  Aurora
  Electronics, Inc. (f/k/a  BSN Corp.,  "Aurora") were  contributed to  the
  Company  effective  September 30,  1988.  Prior  to  its  initial  public
  offering completed  in  April,  1991,  the  Company  was  a  wholly-owned
  subsidiary of  Aurora.    The  Company  is  engaged  principally  in  the
  manufacture and direct  mail marketing  of sports  related equipment  and
  leisure  products  to  institutional  and  sporting  goods  team   dealer
  customers in the  United States.   The Company manufactures  many of  the
  products it sells, including tennis,  volleyball, and other sports  nets;
  items of steel and aluminum construction, such as soccer and field hockey
  goals and volleyball, pole  vault, and high  jump standards; other  track
  and  field  equipment;  gymnastic  and  exercise  mats;  weight   lifting
  equipment; tabletop games and various plastic items.

  Principles of Consolidation and Basis of Presentation

  The consolidated financial statements include the accounts of SSG and its
  wholly-owned subsidiary,  Athletic Training  Equipment Company,  Inc.,  a
  Delaware corporation ("ATEC").  All significant intercompany accounts and
  transactions have  been  eliminated in  consolidation.  The  consolidated
  financial statements  also  include  estimates and  assumptions  made  by
  management that affect  the reported amounts  of assets and  liabilities,
  the reported amounts  of revenues and  expenses, provisions  for and  the
  disclosure of contingent  assets and liabilities.   Actual results  could
  materially differ from those estimates.

  During May 1996, the Company sold substantially all of the assets  (other
  than cash and accounts  receivable) of its  Gold Eagle Professional  Golf
  Products Division (the "Gold Eagle Division").  Subsequent to the sale of
  the Gold Eagle Division, the Company adopted a formal plan to dispose  of
  the  remaining  operations  of   the  Company's  retail  segment   (which
  previously included the Gold Eagle Division) and therefore has classified
  these operations as  discontinued.  On  March 28, 1997,  SSG disposed  of
  substantially all of the remaining  assets of the discontinued  operation
  to Nitro Leisure Products,  Inc., a Delaware corporation.   As a  result,
  the  Company's  retail  segment  is  being  reported  as  a  discontinued
  operation through the date of  disposal in the accompanying  consolidated
  financial statements.


  Change in Fiscal Year

  In January 1997,  the Company changed  its financial  reporting year  end
  from October 31  to September  30. Accordingly,   the  fiscal year  ended
  September 26, 1997 is  a transition period  consisting of eleven  months.
  The Company  will operate  on a  52/53  week year  ending on  the  Friday
  closest to September 30.
<PAGE>

  Inventories

  Inventories are  stated  at  the  lower  of cost  or  market.    Cost  is
  determined  using  the  first-in,  first-out  and  weighted-average  cost
  methods for items manufactured by  the Company and weighted-average  cost
  for items purchased for resale.  As of October 2, 1998 and September  26,
  1997  inventories   (excluding   inventories  related   to   discontinued
  operations) consisted of the following:

                                               1998             1997
                                            ----------       ----------

  Raw materials                            $ 2,761,885      $ 2,410,009
  Work-in-process                              236,466          113,170
  Finished and purchased goods              11,530,406       10,471,262
                                            ----------       ----------
                                            14,528,757       12,994,441
  Less inventory reserve for obsolete or
  slow moving items                          (425,920)        (710,016)
                                            ----------       ----------
                                           $14,102,837      $12,284,425
                                            ==========       ==========

  The Company recorded a $950,000 provision for the year ended November  1,
  1996  to  establish  an  inventory   reserve.    This  reserve   reflects
  management's periodic assessment of the  carrying value of the  Company's
  inventory.  For the year ended October 2, 1998 and September 26, 1997 the
  Company recorded  approximately  $284,000 and    $240,000,  respectively,
  against the reserve  for the disposal  of certain slow-moving  inventory.
  As of October 2, 1998 and  September 26, 1997, approximately 33% and  34%
  of total ending  inventories were  products manufactured  by the  Company
  with the balance being products purchased from outside suppliers.   Sales
  of products manufactured by SSG accounted  for approximately 31% and  35%
  of total net revenues in 1998 and 1997, respectively.  Costs included  in
  products manufactured by  SSG include  raw materials,  direct labor,  and
  manufacturing overhead.

  Advertising and Deferred Catalog Expenses

  The Company expenses  the production  costs of  advertising as  incurred,
  except  for  production  costs  related  to  direct-response  advertising
  activities which are capitalized.   Direct response advertising  consists
  primarily of  catalogs  which  include  order  forms  for  the  Company's
  products. Production costs,  primarily printing  and postage,  associated
  with  catalogs  are  amortized  over   twelve  months.    The   Company's
  advertising expenses for the year ended October 2, 1998, the eleven month
  period ended September 26, 1997, and the year ended November 1, 1996 were
  $2,864,000, $3,776,000, and $3,864,000, respectively.
<PAGE>
  Property, Plant, and Equipment

  Property, plant, and equipment is stated at cost and depreciated over the
  estimated useful  lives of  the related  assets using  the  straight-line
  method.  Leasehold improvements and  property and equipment leased  under
  capital lease obligations  are amortized over  the terms  of the  related
  leases or their estimated useful lives,  whichever is shorter.  The  cost
  of maintenance and repairs is charged to expense as incurred; significant
  renewals  and  betterments  are  capitalized  and  depreciated  over  the
  remaining estimated useful lives of the related assets.

       Depreciation of property,  plant and  equipment is  provided by  the
  straight-line method as follows:

                 Buildings                     Thirty to Forty years
                 Machinery and Equipment       Five years
                 Furniture and Fixtures        Five years

  Intangible Assets

  Cost in excess of  tangible net assets  acquired relates to  acquisitions
  made by the Company.  Trademarks  relate to costs incurred in  connection
  with the  licensing  agreements for  the  use of  certain  trademarks  in
  conjunction with the sale  of the Company's  products.  Other  intangible
  assets are classified as other assets and consist principally of  patents
  and system implementation costs.

       Amortization of intangible assets  is provided by the  straight-line
  method as follows:

            Cost in excess of tangible net assets
                 acquired -- principally forty years

            Trademarks -- five to forty years

            Patents -- seven to eleven years

  Management periodically assesses the recoverability of the carrying value
  of intangible assets in relation to current and anticipated net  earnings
  and cash flows.  Based on  management's assessment, the Company  believes
  its investments in intangible assets are  fully realizable as of  October
  2, 1998.

  The cost of  intangible assets and  related accumulated amortization  are
  removed from the Company's accounts during the year in which they  become
  fully amortized.

  Long-Lived Assets

  Effective November 2, 1996, the Company adopted SFAS No. 121, "Accounting
  for the Impairment of Long-Lived Assets  and for Long-Lived Assets to  be
  Disposed Of."  The adoption of this new accounting standard did not  have
  a material effect on the Company's Consolidated Statements of Operations.

  Other Accrued Liabilities

  As of September 26, 1997, other accrued liabilities consisted of $682,000
  of bonuses, $381,000 of payroll, and $229,000 of other.
<PAGE>
  Income Taxes

  Deferred tax assets  and liabilities are  determined annually based  upon
  the estimated future tax effects of  the differences in the tax bases  of
  existing assets  and  liabilities  and the  related  financial  statement
  carrying  amounts,  using  currently  enacted  tax  laws  and  rates   in
  accordance with  Statement of  Financial  Accounting Standards  No.  109,
  "Accounting for Income Taxes" (See Note 4).

  Net Earnings (Loss) Per Share of Common Stock

  Net earnings (loss) per share of common stock is based upon the  weighted
  average number  of  common  and  common  equivalent  shares  outstanding.
  Outstanding stock options and common stock purchase warrants are  treated
  as common  stock equivalents  when dilution  results from  their  assumed
  exercise.

  Revenue Recognition

  Revenue  is  generally  recognized  when  inventory  is  shipped  to  the
  customer.

  Recently Issued Accounting Pronouncements

  In 1997, the  Financial Accounting Standards  Board issued Statement  No.
  131,  "Disclosures   About  Segments   of  an   Enterprise  and   related
  Information" which is  required to be  adopted in fiscal  year 1999.   As
  this  standard  only   provides  guidance  for   disclosure  of   segment
  information, its adoption will have no  effect on the financial  position
  or results of operations of the Company.

  2.   STOCKHOLDERS' EQUITY:

  Stock Options

  The Company maintains a stock option  plan that provides up to  2,000,000
  shares of common stock  for awards of  incentive and non-qualified  stock
  options to directors and employees of the Company. Under the stock option
  plan, the exercise price of options will not be less than the fair market
  value of the common stock at the date of  grant or not less than 110%  of
  the fair  market value  for incentive  stock options  granted to  certain
  employees, as  more fully  described in  the Amended  and Restated  Stock
  Option Plan.  Options  expire 10 years  from the grant  date, or 5  years
  from the  grant  date for  incentive  stock options  granted  to  certain
  employees, or such earlier date as  determined by the Board of  Directors
  of the Company.
<PAGE>
       Transactions under the plan are summarized as follows:
                                                      Exercise Prices/
                               Shares                 Weighted Avg.
                                                      Price     
                               -------                -------------
       Outstanding at
       October 31, 1995        811,772               $4.80 - $14.25

       Granted                  29,125               $6.50 - $7.13
       Exercised                  (562)              $6.90
       Forfeited              (154,862)              $6.88 - $14.25
                               -------                -------------
       Outstanding at
       November 1, 1996        685,473               $8.85

       Granted                 594,375               $7.49
       Exercised                (6,850)              $6.88
       Forfeited              (232,425)              $7.92
                               -------                -------------
       Outstanding at
       September 26, 1997    1,040,573               $7.26

       Granted                 286,675               $7.65
       Exercised               (73,387)              $6.86
       Forfeited              (393,575)              $8.06
                               -------                -------------
       Outstanding at
       October 2, 1998         860,286               $7.30
                               =======                =============



       Stock Options Outstanding as                Stock Options Exercisable
         of Oct. 2, 1998                               as of Oct. 2, 1998

                             Wtd. Avg.  Wtd. Avg.                 Wtd. Avg.
  Range of Exercise          Remaining  Exercise                  Exercise
      Prices        Shares     Life      Price         Shares       Price
      ------        ------     ----      -----         ------       -----
  $5.60 - $8.38     860,286   7.6yrs.    $7.30         405,284      $7.06


  All options granted  under the stock  option plan during  the year  ended
  October 2, 1998, the  eleven month period ended  September 26, 1997,  and
  the year  ended November  1, 1996  were at  exercise prices  equal to  or
  greater than the fair market value of the Company's stock on the date  of
  the grant.  On May 13, 1996,  the Company repriced the exercise price  to
  the current fair market value  of certain employees' (excluding  officers
  and directors)  stock options  that were  granted pursuant  to the  stock
  option plan and that had an original exercise price in excess of the fair
  market value of the common stock on May 13, 1996 of $6.875.  The exercise
  price of  these options  was lowered  to $6.875.   On  January 23,  1997,
  certain officers' options were  repriced to an  amount above the  current
  fair market value.   The exercise price of  these options was reduced  to
  $7.50.   As of  October 2,  1998, there  were 708,655 shares available  for
  option grants under the stock option plan.
<PAGE>
  In addition to  options granted pursuant  to the stock  option plan,  the
  Company periodically grants  options to purchase  shares of SSG's  common
  stock that are  not reserved  for issuance  under the  stock option  plan
  ("non-Plan options").    During the  year  ended November  1,  1996,  the
  Company granted 20,000  non-Plan options.   All non-Plan options  granted
  were at exercise  prices ranging from  $6.88 to $15.00  per share.   Such
  exercise prices were equal  to or greater than  the fair market value  of
  the Company's common stock on the dates of grant.

  As of October 2, 1998, there  were a total of 960,286 options  (including
  non-Plan options) outstanding with exercise prices ranging from $5.60 per
  share to $8.38 per share.   As of October 2,  1998, 505,284 of the  total
  options outstanding  were  fully  vested  with  455,002  options  vesting
  through January 2001.   As of  September 26, 1997,  735,703 of the  total
  options outstanding were  fully vested  with 550,000  options vesting  in
  January of 2000.   As of November 1,  1996, all outstanding options  were
  fully vested.

  The Company has adopted the pro  forma disclosure provisions of SFAS  No.
  123 "Accounting for Stock Based Compensation".  As required by SFAS  123,
  pro forma information regarding net income  and net income per share  has
  been determined  as  if the  Company  had accounted  for  employee  stock
  options subsequent  to December  31, 1995  under  the fair  value  method
  provided for  under SFAS  123.   The  fair value  for those  options  was
  estimated at the date of grant using a Black-Scholes option pricing model
  with the following weighted-average assumptions: risk-free interest rates
  ranging from 5.34% to 6.24%; a dividend yield of 0%; expected  volatility
  of 25%; and a weighted average expected life for each option of 3  years.
  The weighted average exercise prices and the weighted average fair values
  of employee stock options are as follows:



                   For the Fiscal       For the Eleven       For the Fiscal
                                           Month
                    Year Ended          Period Ended          Year Ended
                 October 2, 1998     September 26, 1997    November 1, 1996
                Weighted  Weighted  Weighted   Weighted  Weighted   Weighted
                Average    Average   Average   Average    Average    Average
                Exercise    Fair    Exercise     Fair    Exercise     Fair
                 Price      Value     Price     Value      Price      Value
                 -----      -----     -----     -----      -----      -----

Exercise price
of stock
option on
grant date
Equals market
value -          $7.65      $1.81    $  -      $  -       $6.89      $2.77
Exceeds market
value -          $  -       $  -     $7.49     $3.01      $  -       $  -


<PAGE>
  For purposes of pro  forma disclosures, the estimated  fair value of  the
  options is amortized to expense over  the vesting period; therefore,  its
  proforma effect will not  be fully realized until  the completion of  one
  full vesting cycle.  The Company's pro forma information is as follows:

                                For the     For the Eleven     For the
                                 Fiscal         Month          Fiscal
                               Year Ended   Period Ended     Year Ended
                               October 2,   September 26,    November 1,
                                  1998          1997            1996
                                ---------     ---------       ----------
  Net income (loss):
       As reported             $4,964,311        $2,000     ($18,736,497)
       Pro forma               $4,526,870     ($804,809)    ($19,163,574)
  Earnings (loss) per share:
      As reported                   $0.62         $0.00           ($2.77)
      Pro forma                     $0.56        ($0.10)          ($2.83)


  Dividends

  During January  1996, the  Company terminated  its annual  cash  dividend
  policy.

  Common Stock Purchase Warrants

  On December 27, 1993, the Company  issued 1,224,459 warrants to  purchase
  1,224,459 shares of SSG's common stock at an exercise price of $25.00 per
  share which may be exercised on or before December 27, 1998.  As a result
  of the 5 for 4 stock split  declared in 1994, each warrantholder will  be
  entitled to  1 1/4  shares of  common  stock upon  the exercise  of  each
  warrant at  an  exercise  price of  $20  per  share.   The  warrants  are
  scheduled to  expire on  December 15,  1998.   Pursuant to  a  Securities
  Purchase Agreement  dated  November  27, 1996  between  Emerson  and  the
  Company, Emerson acquired  directly from the  Company 5-year warrants  to
  acquire 1,000,000 shares of  Common Stock at an  exercise price of  $7.50
  per share, subject to standard antidilution adjustments, for an aggregate
  cash consideration of $500,000.

  Repurchase of Common Stock

  On May 28, 1997, the Company  approved the repurchase of up to  1,000,000
  shares of its  issued and  outstanding common  stock in  the open  market
  and/or privately negotiated transactions.  Such purchases are subject  to
  price and availability  of shares, working  capital availability and  any
  alternative capital  spending programs  of the  Company, and  maintaining
  compliance with the senior credit facility.   As of October 2, 1998,  the
  Company  had  repurchased  approximately   721,000  of  its  issued   and
  outstanding common  stock in  the open  market and  privately  negotiated
  transactions.
<PAGE>
  Net Earnings (Loss) Per Common Share

  In  February  1997,  the  Financial  Accounting  Standards  Board  issued
  Statement No. 128, "Earnings Per Share."  Statement No. 128 replaced  the
  previously reported primary  and fully  diluted earnings  per share  with
  basic and diluted earnings per share.  Unlike primary earnings per share,
  basic earnings  per  share  excludes any  dilutive  effects  of  options,
  warrants, and convertible securities.  Diluted earnings per share is very
  similar to the previously reported fully diluted earnings per share.  All
  earnings per share amounts for all periods have been presented and, where
  necessary, restated to conform to the Statement No. 128 requirements.

  The following  table sets  forth the  computation  of basic  and  diluted
  earnings per share:
<TABLE>


                                   For the     For the Eleven   For the Fiscal
                                 Fiscal Year    Month Period         Year
                                    Ended           Ended           Ended
                                Oct. 2, 1998   Sept. 26, 1997    Nov. 1, 1996
                                  ---------        ---------         --------
<S>                              <C>              <C>               <C>
Numerator:
Net earnings (loss) from         $4,964,311       $2,576,000        $(963,657)
continuing operation

Numerator for basic and
diluted earnings
Per share _ Income
available to common
Shareholders                     $4,964,311       $2,576,000        $(963,657)

Denominator:
Denominator for basic
earnings per share -
Weighted average shares           8,025,606        8,146,074        6,746,788

Effect of dilutive
securities:
Warrants                             94,884               --               --
Employee stock options              116,040            5,340           21,700
                                  ---------        ---------         --------
Denominator for diluted
earnings per share -
Adjusted weighted average
shares and
Assumed conversions               8,236,530        8,151,414        6,768,488
                                  =========        =========        =========
Basic earnings (loss) per share       $0.62            $0.32           $(0.14)
                                  =========        =========        =========

Diluted earning (loss) per share      $0.60            $0.32           $(0.14)
                                  =========        =========        =========

</TABLE>
<PAGE>
<TABLE>
  3.   NOTES PAYABLE AND CAPITAL LEASE OBLIGATIONS:

  As of October 2, 1998 and  September 26, 1997, notes payable and  capital
  lease obligations consisted of the following:

                                           1998                1997 
                                         ---------           ---------
  <S>                                   <C>                 <C>
  Note payable under revolving line
  of credit,
     interest at prime plus 1/2%
     (8.75% at October 2, 1998 and
     9.25% at September 26, 1997) or
     LIBOR plus 2-1/4% (7.78% at
     October 2, 1998 and 8.16% at
     September 26, 1997), due
     October 31, 2000 Collateralized
     by substantially all assets        $4,411,967          $3,000,000

  Term loan, interest at LIBOR plus
     2-1/4% (7.78% at October 2, 1998
     and 8.16% at September 26, 1997),
     Payable in quarterly installments
     of $125,000 plus accrued interest
     through October 31, 2000
     Collateralized by substantially
     all assets                          1,000,000           1,625,000

  Promissory note, noninterest
     bearing, due June 30, 1999            525,000                  --

  Capital lease obligation, interest
    at 7.4%, payable in monthly
    installments of principal and
    Interest totaling $3,159
    through December 1998                    9,357              45,129

  Capital lease obligation, interest
    at 9%, payable  in annual
    installments of principal and
    Interest totaling $55,000
    through August 2005                    261,753             290,599

  Other                                     40,697                  --
                                         ---------           ---------
       Total                             6,248,774           4,960,728
       Less - current portion           (1,087,809)           (564,638)
                                         ---------           ---------
        Long-term debt and capital
        lease obligations, net          $5,160,965          $4,396,090
                                         =========           =========

</TABLE>
<PAGE>
  Credit Facilities

  The Company has a senior secured  credit facility to finance its  working
  capital requirements. The  Company's ability  to borrow  funds under  its
  revolving credit facility is based  upon certain percentages of  eligible
  trade accounts  receivable and  eligible inventories.   On  September  9,
  1997, the Company  entered into a  Second Amended and  Restated Loan  and
  Security Agreement ("Agreement"), which includes a senior credit facility
  of $25,000,000 with a maturity date of  October 31, 2000.  This Agreement
  provides for a revolving line of  credit, a letter of credit facility,  a
  term loan, additional loans  to be made  to SSG for  the cost of  certain
  capital expenditures  (up  to  a maximum  of    $4,000,000)  and  reduced
  interest rates and fees.  The Agreement also  contains financial and  net
  worth covenants  in addition  to limits  on capital  expenditures. As  of
  October 2, 1998, the Company was in compliance with the covenants in  the
  senior credit facility.

  Amounts outstanding under the  senior credit facility are  collateralized
  by substantially all assets of the Company.  As of  October 2, 1998,  the
  Company had the option of electing the revolving credit facility and  the
  term loan  to bear  interest at  the prevailing  LIBOR rate  plus  2-1/4%
  (7.78% at October 2, 1998) or the lender's prime rate plus 1/2% (8.75% at
  October 2, 1998).  Historically, the Company has elected the lower of the
  interest rates available under the facility.

  As of  October  2, 1998,  the  Company had  borrowings  of  approximately
  $4,412,000 outstanding under  the revolver,  approximately $1,891,000  of
  letters of credit  outstanding for  foreign purchases  of inventory,  and
  availability of approximately $14,673,000.  In addition, as of October 2,
  1998, SSG  had borrowings  of $1,000,000  under the  term loan  which  is
  payable in quarterly  installments of principal  and accrued interest  of
  $125,000 through October 31, 2000.

  Maturities of  the Company's  capital  lease obligations  and  borrowings
  under the senior credit  facility as of October  2, 1998, by fiscal  year
  and in the aggregate, are as follows:


                 1999                          $1,087,809
                 2000                             546,295
                 2001                           4,453,846
                 2002                              42,861
                 2003                              44,383
                 Thereafter                        73,580
                                                ---------
                 Total maturities              $6,248,774


<PAGE>
  4.   INCOME TAXES:

  As of October 2, 1998 and September  26, 1997, the components of the  net
  deferred tax assets and liabilities are as follows:


                                                 1998           1997
                                                -------      ---------
  Current deferred tax assets --
       Allowances for doubtful accounts        $134,820       $373,029
       Inventories                              567,005      1,513,689
       Other accrued liabilities                202,493        182,960
                                                -------      ---------
       Total current deferred tax assets       $904,318     $2,069,678
                                                =======      =========


  Noncurrent deferred tax assets
  (liabilities)
       Cost in excess of tangible net
            assets acquired                  $(122,643)       $232,298
       Other intangible assets              (1,030,069)    (1,348,406)
       Net operating loss carryforward        5,537,457      6,767,809
       Minimum tax credit carryforward          274,444        187,194
                                              ---------      ---------
  Total noncurrent deferred tax assets       $4,659,189     $5,838,895
                                              =========      =========


  The Company's  net operating  loss carryforward  can  be used  to  offset
  future taxable  income and  can be  carried  forward for  15 years.    No
  valuation allowance  has been  recorded for  the Company's  deferred  tax
  assets because management believes it is more likely than not such assets
  will be realized. Management believes that  the deferred tax assets  will
  be realized by  future profitable operating  results.  Historically,  the
  Company has been profitable.  The net loss reported  for the fiscal  year
  ended November 1,  1996 is  primarily the  result of  the retail  segment
  which  has  been  discontinued.     Management  believes  the   Company's
  continuing operations will continue to be profitable.

  The income tax provision (benefit) consisted of the following:

                              1998            1997             1996
                            ---------      ----------       ----------
  Current                    $214,016     $(2,074,117)     $(1,830,600)
  Deferred                  2,345,066       1,723,686       (8,512,158)
                            ---------      ----------       ----------
    Income tax
     provision (benefit)   $2,559,082       $(350,431)    $(10,342,758)
                            =========       =========       ==========


<PAGE>

  The provision (benefit) for income taxes related to continuing operations
  in the accompanying statements of operations  for the year ended  October
  2, 1998, the eleven months ended  September 26, 1997, and the year  ended
  November 1,  1996,  differ  from the  statutory  federal  rate  (34%)  as
  follows:

                                    1998           1997          1996
                                  ---------      ---------      --------

  Income tax provision
  (benefit) at statutory
  Federal rate of 34%            $2,557,954     $1,207,533     ($475,726)

  State income taxes, net of
       federal benefit                   --       (306,611)           --


  Other                               1,128         74,647        40,190
                                  ---------      ---------      --------
  Total provision (benefit)
  for income taxes               $2,559,082       $975,569     ($435,536)
                                  =========      =========      ========



  5.   ACQUISITION:

  During December 1997,  the Company  acquired certain  assets of  Athletic
  Training Equipment Company,  Inc.  ("ATEC"),  a manufacturer of  pitching
  machines  for  cash,  a  noninterest  bearing  promissory  note  and  the
  assumption of certain liabilities.   The Company  has accounted for  this
  acquisition using  the  purchase method  and,  as such,  its  results  of
  operations  are  combined  with  the  Company's  results  of   operations
  subsequent to  the  acquisition  date.    No  pro  forma  information  is
  presented herein as it would not materially differ from actual results.

  6.   MAJOR CUSTOMERS AND CONCENTRATION OF BUSINESS RISK:

  The Company's customers  for continuing operations  are primarily  public
  and private schools, state and local  governments, and the United  States
  Government.  Sales to these customers for the year ended October 2, 1998,
  the eleven month  period ended  September 26,  1997, and  the year  ended
  November 1, 1996 were as follows:

                                  1998      1997      1996
                                  ----      ----      ----
  Public and private schools       35%       33%       36%
  State and local governments      16%       12%       15%
  United States Government          7%        7%        8%


  The Company did not have any individual customers that accounted for more
  than 10% of net revenues for the fiscal year ended October 2, 1998, the
  eleven month period ended September 27, 1997, or the fiscal year ended
  November 1, 1996.
<PAGE>
  The majority of the Company's sales  are to institutional customers  that
  are publicly funded. The Company extends credit based upon an  evaluation
  of a  customer's financial  condition and  provides for  any  anticipated
  credit  losses  in  its  financial  statements  based  upon  management's
  estimates and ongoing reviews of recorded allowances.

  7.   COMMITMENTS AND CONTINGENCIES:

  Leases

  The Company leases a portion of its office, warehouse, computer equipment
  and manufacturing  locations under  noncancelable operating  leases  with
  terms ranging  from one  to ten  years.   The majority  of the  Company's
  leases contain renewal options that extend the leases beyond the  current
  lease terms.

  Future minimum lease  payments under noncancelable  operating leases  for
  office, warehouse, computer equipment  and manufacturing locations,  with
  remaining terms in excess of one year are as follows:


                    1999              $1,696,812
                    2000               1,562,382
                    2001               1,455,487
                    2002                 615,086
                    2003                 559,897
                    Thereafter           729,795
                                       ---------
                                      $6,619,459
                                       =========

  Rent expense was approximately $1,644,646, $1,485,000, and $1,609,000 for
  fiscal 1998, 1997, and 1996, respectively.

  Severance Agreements

  During 1991,  the  Company entered  into  Severance Agreements  with  two
  executive officers of the Company providing that these officers would  be
  entitled to receive up to approximately  three times their annual  salary
  and bonus if  there is  both a  change in  control and  a termination  or
  resignation (as  defined  therein) of  such  officers. During  1995,  the
  Company entered into Severance Agreements with two additional  executive
  officers and an  employee having substantially  the same  terms as  those
  described above.   During 1998, the  Company  entered into  a  Severance
  Agreement with an executive officer of the Company and also an employee 
  of the Company,  In  1996, two of these Severance Agreements  were cancelled  
  without payments  due to the resignation of these  designated employees.   
  Subsequent  to November 1, 1996, an  officer  resigned  pursuant to  a  
  Purchase  Agreement  whereby Emerson Radio Corp. acquired 1,600,000 shares  
  of SSG's common stock  and warrants to acquire an additional 1,000,000 shares.
  The officer was paid approximately $680,000 pursuant to the Severance  
  Agreement on  December 10, 1996.  In July, 1998, an  officer retired and 
  the Company recorded a nonrecurring pre-tax charge  for the year  ended 
  October 2, 1998 in the amount of $1.2 million relating to the retirement.
<PAGE>
  Product Liability and Other Claims

  Because of  the nature  of the  Company's products,  SSG is  periodically
  subject to  product liability  claims resulting  from personal  injuries.
  The Company from  time to time  may become involved  in various  lawsuits
  incidental to the Company's business, some of which will relate to claims
  of injuries  allegedly  resulting  in  substantial  permanent  paralysis.
  Significantly increased product liability claims continue to be  asserted
  successfully against manufacturers throughout the United States resulting
  in general uncertainty as to the nature and extent of manufacturer's  and
  distributors' liability for personal injuries.

  There can be no  assurance that the  Company's general product  liability
  insurance will be  sufficient to cover  any successful product  liability
  made  against  the  Company.    In  management's  opinion,  any  ultimate
  liability arising out  of currently pending  product liability and  other
  claims will not have a material adverse effect on the Company's financial
  condition or results of operations.  However, any claims substantially in
  excess of the Company's insurance coverage, or any substantial claim  not
  covered by  insurance,  could  have a  material  adverse  effect  on  the
  Company's results of operations and financial condition.

  8.   EMPLOYEES' SAVINGS PLAN AND EMPLOYEE STOCK PURCHASE PLAN

  Effective June 1,  1993, the Company  established a defined  contribution
  profit sharing  plan (the  "401(k) Plan")  for  the benefit  of  eligible
  employees.  All employees with one year of service and who have  attained
  the age of 21 are eligible to participate in the 401(k) Plan.   Employees
  may contribute  up  to 15%  of  their compensation,  subject  to  certain
  limitations, which qualifies under  the compensation deferral  provisions
  of Section 401(k) of the Internal Revenue Code.

  The 401(k)  Plan  contains provisions  that  allow the  Company  to  make
  discretionary contributions during each plan year. Employer contributions
  for  the  fiscal  year  ended  October   2,  1998  were  $78,426.     All
  administrative expenses of the 401(k) Plan are paid by the Company.

  Effective July  1,  1997,  the  Company  established  an  Employee  Stock
  Purchase Plan  for  the benefit  of  eligible employees.    All  eligible
  employees are allowed  to purchase shares  of SSG Common  Stock at a  15%
  discount from the market price.

  9.   CHANGE IN CONTROL OF  MANAGEMENT

  On December 10, 1996, pursuant to  a Securities Purchase Agreement  dated
  November 27,  1996 between  Emerson Radio  Corp. and  SSG ("the  Purchase
  Agreement"), Emerson acquired directly from SSG 1,600,000 shares of newly
  issued Common Stock for  an aggregate consideration  of  $11,500,000  and
  five-year warrants to  acquire an additional  1,000,000 shares of  Common
  Stock at  an  exercise  price  of   $7.50  per  share  for  an  aggregate
  consideration of $500,000.  In addition,  Emerson agreed  to arrange  for
  foreign trade credit financing  of $2,000,000 for the  benefit of SSG  to
  supplement SSG's existing credit facilities. This currently has not  been
  utilized.  Pursuant to the Purchase  Agreement, SSG caused a majority  of
  the members  of  SSG's  Board  of Directors  to  consist  of    Emerson's
  designees.  A nonrecurring pre-tax charge of $1.3 million was recorded in
  the first  quarter of  the fiscal  year  ended September  26, 1997    for
  compensation payments relating to the "change in control" of the Company.
<PAGE>

  10.  DISCONTINUED OPERATIONS

  On May 20, 1996, SSG disposed  of substantially all of the assets  (other
  than cash and accounts receivable) of  the Gold Eagle Division to  Morris
  Rosenbloom & Co.,  Inc., a privately-held  corporation. The  sale of  the
  Gold Eagle Division resulted in a pretax loss of approximately $750,000.

  Subsequent to the sale of the Gold Eagle Division, the Company adopted  a
  formal plan  to dispose  of the  remaining  operations of  the  Company's
  retail segment (which  previously included the  Gold Eagle Division)  and
  therefore has classified these operations  as discontinued. On March  28,
  1997, SSG disposed of  substantially all of the  remaining assets of  the
  discontinued operations  to  Nitro  Leisure Products,  Inc.,  a  Delaware
  corporation. Pursuant  to  the  Asset Acquisition  Agreement,  the  total
  consideration  paid  to  SSG  was  $8,161,000  in  cash.  The   following
  represents net current assets and liabilities  as well as net  noncurrent
  assets of discontinued operations as of November 1, 1996 and the  results
  of operations for the period from  November 2, 1996 through the  disposal
  date of March 28, 1997, and the year ended November 1, 1996.

                                                November 1,
                                                  1996      
                                                 ----------
  Current assets                                $14,188,152
  Current liabilities                           (20,518,079)
                                                 ----------
         Net current liabilities                $(6,329,927)
                                                 ==========

  Noncurrent assets                             $16,365,572
  Noncurrent liabilities                                 --
                                                 ==========
         Net noncurrent assets                  $16,365,572
                                                 ==========


                                     For the period from   For the Year Ended
                                       Nov. 2, 1996 to      November 1, 1996
                                        March 28, 1997
                                           -----------         -----------
  Net revenues                            $  1,790,395        $ 18,725,955
  Earnings (loss) from operations, 
    net income taxes                             --             (2,242,143)
  Loss on disposal, net of income taxes     (2,574,000)        (15,530,697)


  The net loss from operations for the  year ended November 1, 1996 includes
  allocated  interest  expense   of  approximately   $1,090,000  related  to
  borrowings under the  Company's senior  credit facility.  Interest expense
  charged to discontinued operations was based upon the amount of borrowings
  that management  estimated  would  be  repaid  from  the  proceeds  of the
  disposal of the Company's retail segment operations.
<PAGE>
  The net loss on  disposal includes a charge  recorded during the quarterly
  period ended May 3, 1996 of approximately $9.3 million ($5.9 million after
  estimated income  tax  benefit)  to record  the  net  assets  at estimated
  realizable value based  upon a  proposed rights  offering pursuant  to the
  Company's plan of disposal. During the quarterly period ended May 3, 1996,
  the Company also  recorded a reserve  of approximately  $3.9 million ($2.5
  million after  estimated  tax benefit)  for  anticipated  operating losses
  during the  estimated  twelve month  disposal  period,  including interest
  expense.   As  a  result  of  certain  factors,  including,  among others,
  management's assessment  of the  ultimate success  of the  proposed rights
  offering and estimates of the time required to effect such transaction, as
  well as  the  Company's  projected  liquidity  requirements,  the  Company
  determined that  a private  sale of  the  remaining assets  of  its retail
  segment was a preferable  and more expeditious method  of disposal.  Based
  upon management's estimates of the net proceeds to be received pursuant to
  such disposal, the Company  recorded an additional charge  of $5.8 million
  ($3.7 million after estimated income tax benefit) during the quarter ended
  August 2, 1996 and a charge of  $5.2 million ($3.4 million after estimated
  income tax benefit)  during the quarter  ended November 1,  1996 to record
  the net assets at estimated net realizable value.

  On March 4, 1997,  the Company signed a  letter of intent for  the sale of
  the discontinued retail segment. Based upon management's estimates at that
  time of the  net proceeds  to be received  pursuant to  such disposal, the
  Company recorded a  pre-tax charge  of  $3.9  million ($2.6  million after
  estimated income tax benefit)  during the quarter ended  January 31, 1997.
  This charge  was  provided  to record  the  net  assets  at  estimated net
  realizable value in  accordance with the  purchase price set  forth in the
  letter of intent. On March 28, 1997, the Company sold the remaining assets
  of the discontinued  segment for approximately  $8.2 million  and used the
  sale proceeds to reduce the Company's outstanding debt.

  11.  SUBSEQUENT EVENT

  On October 28, 1998, the Company approved a second repurchase program  of
  up to an additional 1,000,000 shares of its issued and outstanding common
  stock in the open market and/or privately negotiated transactions.   Such
  purchases are  subject  to  price and  availability  of  shares,  working
  capital availability and any alternative capital spending programs of the
  Company.  The Company will evaluate purchases of common stock based  upon
  day to day market conditions.

<PAGE>
<TABLE>
  12.  SELECTED FINANCIAL DATA (UNAUDITED)

     The following sets forth certain historical financial information for
    the Company for each of the last 5 years (amounts in thousands, except
    per share amounts):


                                                 Eleven
                                       Year      Months     Year     Ten Months
                                       Ended     Ended      Ended       Ended    Year Ended
                                       Oct. 2    Sep. 26    Nov. 1     Oct. 31    Dec. 31
                                        1998      1997      1996         1995       1994
                                        ----      ----      ----         ----       ----
<S>                                   <C>        <C>       <C>         <C>        <C>
Statement of Earnings Data:
Net revenues                          $97,292    $79,109   $80,521     $65,134    $66,920
Gross profit                           37,726     31,404    29,955      25,259     26,326
Operating profit (loss)                 7,157      4,226       (65)      3,894      5,162
Interest expense                          474        757     1,372       1,126        973
Other income (expense), net               841         83        38         209         (5)
Earnings (loss) from continuing
     operations                         4,964      2,576      (964)      1,847      2,802
Earnings (loss) from discontinued 
     operations                           --      (2,574)  (17,773)       (457)     1,900
 Net earnings (loss)                    4,964          2   (18,737)      1,390      4,702
Net earnings (loss) per common share
     from continuing operations(1)       0.62       0.32     (0.14)       0.27       0.43
Net earnings (loss) per common share
     from discontinued operations(1)(3)   --       (0.32)    (2.64)      (0.07)      0.29
Net earnings (loss) per common share(1)  0.62       0.00     (2.78)       0.20       0.72
Net earnings (loss) per common share
     from continuing operations-
     assuming dilution(1)                0.60       0.32     (0.14)       0.27       0.42
Net earnings (loss) per common share
     from discontinued operations-
     assuming dilution(1)(3)              --       (0.32)    (2.63)      (0.07)      0.28
Net earnings (loss) per common share-
     assuming dilution (1)              $0.60      $0.00    $(2.77)      $0.20      $0.70
Weighted average common shares
    outstanding(1)                      8,026      8,146     6,747       6,941      6,490
Weighted average common shares
    Outstanding _ assuming dilution(1)  8,237      8,151     6,768       6,950      6,760
Cash dividends declared per
    common share (2)                      --         --        --       $  .12    $   .13



                                    At Oct. 2  At Sept. 26  At Nov. 1  At Oct. 31  At Dec. 31
  Balance Sheet Data:                 1998       1997        1996        1995        1994
                                      ----       ----        ----        ----        ----
  <S>                                 <C>        <C>         <C>         <C>         <C>
  Working capital                     $25,245    $24,006     $21,322     $42,231     $32,886
  Total assets                         54,804     50,484      70,009      86,355      71,616   
  Long-term obligations, net            5,161      4,418      24,338      29,199      16,698
  Total liabilities                    13,626     11,527      40,846      38,745      25,143
   Stockholders' equity                41,178     38,957      29,163      47,610      46,473

</TABLE>
<PAGE>
  (1)       Reflects the 5 for 4 stock split declared during January, 1994.
  (2)       Dividends declared  in  1995 consisted  of  a $0.03  per  share
  dividend for  the  first three  quarters.   Dividends  declared  in  1994
  consisted  of a  $0.04  per share dividend for the fourth quarter of 1993
  and a $0.03 per share dividend for the first, second  and third  quarters
  of 1994.
  (3)       See Note 10 to  the consolidated financial statements  included
  in Item 8. _ "Financial Statements and Supplementary Data."
  (4)    During 1995, the Company changed its financial reporting year  end
  from December 31  to October  31.   Consequently, the  fiscal year  ended
  October 31,  1995  is a  transition  period consisting  of  ten  calendar
  months.  During 1997,  the Company changed  its financial reporting  year
  end from October 31  to September 30.   Therefore, the fiscal year  ended
  September 26, 1997 is a transition  period consisting of eleven  calendar
  months.

<PAGE>
<TABLE>
  13.  QUARTERLY INFORMATION (UNAUDITED):

       The following  table sets  forth certain  information regarding  the
  Company's results of  operations for each  full quarter  within the  year
  ended October 2,  1998, and September  26, 1997.   The fourth quarter  of
  1997 is not presented since it consisted of two calendar months.


                                  1998                         1997
                       1st      2nd      3rd       4th      1st     2nd      3rd
                     Quarter Quarter  Quarter   Quarter  Quarter  Quarter  Quarter
                     ------- -------  -------   -------  -------  -------  -------    
<S>                  <C>     <C>       <C>      <C>      <C>      <C>      <C>
Statement of
Earnings Data

Net revenues         $14,412 $32,273   $25,340  $25,267  $14,580  $28,312  $23,224
Gross profit           5,627  12,149     9,840   10,110    5,905   10,717    9,522
Operating profit
(loss) (1)              (923)  3,794     2,600    1,686   (1,933)   3,238    2,875
Interest expense         119     156        94      105      196      273      179
Other income,  net       280     110       128      323        7       26       16
Net earnings (loss)
from Continuing
operations              (503)  2,474     1,739    1,255   (1,356)   1,974    1,976
Net earnings (loss)
from Discontinued
operations              --       --       --              (2,574)    --       --
Net earnings (loss)     (503)  2,474     1,739    1,255   (3,930)   1,974    1,976
Net earnings (loss)
per Common share      $(0.06)  $0.31     $0.22    $0.16   $(0.51)   $0.24    $0.24
Net earnings (loss)
per Common share -
assuming  dilution    $(0.06)  $0.30     $0.20    $0.16   $(0.51)   $0.24    $0.24
Weighted average
 Shares outstanding    8,085   8,108     8,089    7,954    7,697    8,366    8,334
Weighted average
 Shares outstanding                                                          
 -assuming dilution    8,085   8,324     8,560    8,070    7,698    8,367    8,325



  (1)   The 1st  quarter  of 1997  includes  $1.3 million  of  nonrecurring
  charges and the 4th quarter of 1998 includes $1.2 million of nonrecurring
  charges
</TABLE>
<PAGE>
  Item 9.     Changes in and  Disagreements with Accountants on  Accounting
  and Financial Disclosure.

       Effective June 20, 1997, the Company appointed Ernst & Young LLP  as
  its independent auditors for the fiscal  year ending September 26,  1997,
  to replace the firm of Arthur Andersen LLP, who was dismissed as auditors
  of the Company effective June 20, 1997.  The decision to change  auditors
  was recommended by  the Audit  Committee of  the Board  of Directors  and
  approved by the Company's Board of Directors.

       The reports  of  Arthur  Andersen LLP  on  the  Company's  financial
  statements for  the the  year ended  November  1, 1996  (which  financial
  statements are included in the Company's  Annual Report on Form 10-K  for
  the fiscal year  ended September  26, 1997)  did not  contain an  adverse
  opinion or a disclaimer of opinion,  nor were they qualified or  modified
  as to uncertainty, audit scope or accounting principles.

       During the ten month year ended November 1, 1996, and the subsequent
  interim period prior to June 20,  1997, there were no disagreements  with
  Arthur Andersen LLP on any matter of accounting principles or  practices,
  financial statement disclosures,  or auditing scope  or procedure,  which
  disagreements, if not  resolved to  the satisfaction  of Arthur  Andersen
  LLP, would have caused it  to make a reference  to the subject matter  of
  the disagreements in connection with its reports.

       The Company had  not consulted  with Ernst  & Young  LLP during  the
  fiscal year ended November 1, 1996,  or subsequent interim periods  prior
  to June 20, 1997, on either  the application of accounting principles  or
  the type  of opinion  Ernst &  Young  LLP might  issue on  the  Company's
  financial statements.

                                  PART III

  Item 10.  Directors and Executive Officers of the Registrant.

         See the discussion under the captions "Election of Directors"  and
  "Executive Compensation  and Other  Information" contained  in the  Proxy
  Statement for the Annual Meeting of Stockholders to be held January 29,
  1999, which information is incorporated herein by reference, and  Item 1.
  "Business - Executive Officers of the Company."

  Item 11.  Executive Compensation.

         See the discussion under  the caption "Executive Compensation  and
  Other Information"  contained  in  the Proxy  Statement  for  the  Annual
  Meeting of Stockholders to be held January 29, 1999, which  information,
  except the Performance Graph and the Report of the Compensation Committee
  and Stock  Option Committee  on Executive  Compensation, is  incorporated
  herein by reference.

  Item 12.  Security Ownership of Certain Beneficial Owners and Management.

          See  the discussion  under  the caption  "Security  Ownership  of
  Certain  Beneficial  Owners  and  Management"  contained  in  the   Proxy
  Statement for the Annual Meeting of Stockholders to be held January 29,
  1999, which information is incorporated herein by reference.
<PAGE>
  Item 13.  Certain Relationships and Related Transactions.

         See the  discussion under the  caption "Certain Relationships  and
  Related Transactions" contained  in the  Proxy Statement  for the  Annual
  Meeting  of  Stockholders  to  be  held  on  January 29, 1999,  which
  information is incorporated herein by reference.


   PART IV

  Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K.

  (a)(1)   Financial Statements.  See Item 8.

  (a)(2)   Supplemental Schedule Supporting Financial Statements. See Item 8.

  (a)(3)   Management Contract or Compensatory Plan.  [See Index].  Each of
  the following Exhibits described on the Index to Exhibits is a management
  contract or compensatory plan:  Exhibits 10.1, 10.2, 10.3,  10.4, 10.5, 
  10.6, 10.7, 10.8, 10.9, 10.10, 10.11, 10.12, 10.12.1 and 10.13.

  (b)    Reports on Form 8-K.  None.

  (c)    Exhibits.  See Index.

<PAGE>

                                  SIGNATURES


       Pursuant  to  the  requirements  of  Section  13  or  15(d)  of  the
  Securities Exchange  Act of  1934, the  registrant has  duly caused  this
  report to be  signed on  its behalf  by the  undersigned, thereunto  duly
  authorized.

  Dated: November 23, 1998

                                  SPORT SUPPLY GROUP, INC.


                                  By:    /s/ Geoffrey P. Jurick
                                       Geoffrey P. Jurick
                                       Chairman of the Board

       Pursuant to the requirements of the Securities Exchange Act of 1934,
  this report has been signed on November 23, 1998 by the following persons
  on behalf of the registrant and in the capacities indicated.

      Signature                        Title


     /s/Geoffrey P. Jurick             Chairman of  the Board and
       Geoffrey P. Jurick              Chief Executive Officer


     /s/John P. Walker                 President, Chief Operating Officer,
      John P. Walker                   Chief Financial Officer and Director


     /s/Johnson C. S. Ko               Director
      Johnson C. S. Ko


  /s/ Peter G. Bunger                  Director
      Peter G. Bunger


  /s/ Thomas P. Treichler              Director
      Thomas P. Treichler

<PAGE>

                               INDEX TO EXHIBITS


    Exhibit
     Number                 Description of Exhibits          

      2.1      Securities Purchase Agreement  dated November 27,  1996 by
               and  between   the   Company  and   Emerson   Radio  Corp.
               ("Emerson") (incorporated by  reference from Exhibit  2 to
               the Company's  Report on  Form 8-K  filed on  December 12,
               1996).

      2.2      Asset Acquisition Agreement dated as  of March 28, 1997 by
               and between the  Company and Nitro  Leisure Products, Inc.
               (incorporated  by  reference  from   Exhibit  2.1  to  the
               Company's Report on Form 8-K dated April 11, 1997).

      3.1      Amended and Restated  Certificate of Incorporation  of the
               Company (incorporated by reference from Exhibit 4.1 to the
               Company's Registration Statement on Form S-8 (Registration
               No. 33-80028)).

     3.1.1     Certificate   of  Amendment   of   Amended   and  Restated
               Certificate of Incorporation  of the Company (incorporated
               by   reference  from   Exhibit   4.1   to  the   Company's
               Registration Statement on  Form S-8 (Registration  No. 33-
               80028)).

      3.2      Amended and Restated  Bylaws of the  Company (incorporated
               by reference from  Exhibit 3.2 to the  Company's Report on
               Form 10-K for the Fiscal Year ended November 1, 1996).

      4.1      Specimen  of  Common  Stock Certificate  (incorporated  by
               reference from Exhibit  4.1 to the  Company's Registration
               Statement on Form S-1 (Registration No. 33-39218)).

      4.2      Warrant Agreement  entered  into between  the  Company and
               Warrant Agent, including form of  Warrant, relating to the
               purchase of up to 1,300,000 shares of the Company's common
               stock for $25.00 per share,  which expires on December 15,
               1998 (incorporated  by reference from  Exhibit 4.2  to the
               Company's Registration Statement on Form S-3 (Registration
               No. 33-71574)).

      4.3      Warrant Agreement  entered  into between  the  Company and
               Emerson relating to the purchase of up to 1,000,000 shares
               of the Company's  common stock for $7.50  per share, which
               expires on  December 10,  2001 (incorporated  by reference
               from Exhibit  4(a)  to the  Company's Report  on  Form 8-K
               dated December 12, 1996).

     *10.1     Consulting and Separation Agreement effective July 28, 
               1998, entered into by and between the Company and 
               Peter S. Blumenfeld.

<PAGE>
    Exhibit
     Number                 Description of Exhibits          

      10.2    Employment  Agreement  entered  into by  and  between  the
              Company and Terrence M. Babilla (incorporated by reference
              from Exhibit 10.3 to the Company's Report on Form 10-Q for
              the quarter ended April 3, 1998).

      10.3    Employment  Agreement  by  and  between  the  Company  and
              John P. Walker  (incorporated  by reference  from  Exhibit
              10.4 to the Company's Report on  Form 10-Q for the quarter
              ended April 3, 1998).

      10.4    Employment Agreement by and between the Company and Eugene
              J.P. Grant (incororated by reference from Exhibit 10.2 to
              the Company's Report on Form 10-Q for the quarter ended
              April 3, 1998).

      10.5    Employment Agreement by  and between the  Company and Adam
              L. Blumenfeld (incorporated by reference from Exhibit 10.1
              to the Company's Report on Form 10-Q for the quarter ended
              April 3, 1998).

      10.6    Employment  Agreement  by  and  between  the  Company  and
              Geoffrey P. Jurick (incorporated by reference from Exhibit
              10.4 to the Company's Report on Form 10-K for the fiscal year
              ended September 26, 1997).

      10.7    Non-Qualified Stock  Option Agreement  by and  between the
              Company and Geoffrey P.  Jurick (incorporated by reference
              from Exhibit 10.5 to the Company's Report on Form 10-Q for
              the quarter ended August 1,1997).

      10.8    Non-Qualified Stock  Option Agreement by and between the
              Company and John P. Walker (incorporated by reference from
              Exhibit 10.6 to the Company's Report  on Form 10-Q for the
              quarter ended August 1, 1997).

    10.8.1   Amendment No. 1 to Stock Option Agreement by and between the
             Company and John P. Walker (incorporated by reference from
             Exhibit 10.8 to the Company's Report on Form 10-Q for the
             quarter ended April 3, 1998).

   *10.9     Non-Qualified Stock Option Agreement by and between the
             Company and Terrence M. Babilla.

    10.9.1   Amendment No. 1 to Stock  Option Agreement by and between the
             Company and Terrence M. Babilla (incorporated by reference
             from Exhibit 10.9 to the Company's Report on Form 10-Q for 
             the quarter ended April 3, 1998).

    10.10     Restricted Stock Agreement by and  between the Company and
              John P. Walker (incorporated by refrence from Exhibit 10.6
              to the Company's Report on Form 10-Q for the quarter ended
              April 3, 1998).

    10.11     Consulting and Separation Agreement  dated as of September
              16, 1994  by  and  between   the  Company  and  Jerry  L.
              Gunderson.

    10.12     Form  of  Severance  Agreement entered  into  between  the
              Company and Terrence M. Babilla (incorporated  by reference
              from Exhibit 10.5 to the  Company's  Registration  Statement
              on Form  S-1(Registration No. 33-39218)).

    10.12.1   Severance Agreement by and between the Company and 
              John P. Walker (incorporated by reference from Exhibit 10.5
              to the Company's Report on Form 10-Q for the quarter ended
              April 3, 1998).

    10.13     Severance  Agreement entered  into  between  the
              Company and Doug Pryor (incorporated by reference from
              Exhibit 10.7 to the Company's Report on Form 10-Q for the 
              quarter ended April 3, 1998).

    10.14     Form of Indemnification Agreement entered into between the
              Company and each  of the directors of  the Company and the
              Company's General Counsel  (incorporated by reference from
              Exhibit 10.3  to the  Company's Registration  Statement on
              Form S-1 (Registration No. 33-39218)).

    10.15     Sport  Supply Group,  Inc.  Employee  Stock Purchase  Plan
              (incorporated  by  reference  from   Exhibit  4.1  to  the
              Company's Registration Statement on Form S-8 (Registration
              No. 33-27191)).

    10.16     Sport Supply Group, Inc. Amended and Restated Stock Option
              Plan (incorporated  by reference from  Exhibit 4.1  to the
              Company's Registration Statement on Form S-8 (Registration
              No. 33-27193)).

    10.17     Registration Rights  Agreement by  and among  the Company,
              Emerson   and   Emerson    Radio   (Hong   Kong)   Limited
              (incorporated  by  reference  from  Exhibit  4(b)  to  the
              Company's Report on Form 8-K filed on December 12, 1996)

<PAGE>
    Exhibit
     Number                 Description of Exhibits          


     10.18     Assignment of  Agreement and Inventory  Purchase Agreement
               to Affiliate  by  Aurora (incorporated  by  reference from
               Exhibit 10.10 to  the Company's Registration  Statement on
               Form S-1 (Registration No. 33-39218)).

     10.19     Form of Tax Indemnity Agreement by and between the Company
               and Aurora (incorporated  by reference from  Exhibit 10.16
               to  the  Company's  Registration  Statement  on  Form  S-1
               (Registration No. 33-39218)).

     10.20     Master Agreement, dated  as of  February 19, 1992,  by and
               between MacMark  Corporation,  MacGregor  Sports Products,
               Inc. and  Aurora (incorporated  by reference  from Exhibit
               10.21 to the  Company's Report on  Form 10-K for  the year
               ended 1991).

     10.21     Perpetual  License Agreement,  dated  as  of February  19,
               1992,  by   and  between  MacMark   Corporation,  Equilink
               Licensing  Corporation,   and   Aurora   (incorporated  by
               reference from  Exhibit 10.22 to  the Company's  Report on
               Form 10-K for the year ended 1991).

     10.22     Perpetual  License Agreement,  dated  as  of February  19,
               1992, by and  between MacGregor Sports  Products, Inc. and
               Aurora (incorporated  by reference  from Exhibit  10.23 to
               the Company's  Report  on  Form 10-K  for  the  year ended
               1991).

     10.23     Trademark Maintenance Agreement, dated  as of February 19,
               1992,  by   and  between  MacMark   Corporation,  Equilink
               Licensing  Corporation,   and   Aurora   (incorporated  by
               reference from  Exhibit 10.24 to  the Company's  Report on
               Form 10-K for the year ended 1991).

     10.24     Trademark Maintenance Agreement, dated  as of February 19,
               1992, by and  between MacGregor Sports  Products, Inc. and
               Aurora (incorporated  by reference  from Exhibit  10.25 to
               the Company's  Report  on  Form 10-K  for  the  year ended
               1991).

     10.25     Trademark Security  Agreement,  dated as  of  February 19,
               1992, by and  between MacGregor Sports  Products, Inc. and
               Aurora (incorporated  by reference  from Exhibit  10.26 to
               the Company's  Report  on  Form 10-K  for  the  year ended
               1991).

     10.26     Amendment  No. 1   to  Perpetual  License   Agreement  and
               Trademark Maintenance  Agreement  dated as  of November 1,
               1992,  by   and  between  MacMark   Corporation,  Equilink
               Licensing  Corporation and  the  Company  (incorporated by
               reference from  Exhibit 10.24 to  the Company's  Report on
               Form 10-K for the year ended 1992).

<PAGE>
    Exhibit
     Number                 Description of Exhibits          



     10.27     Amendment  No. 1   to  Perpetual  License   Agreement  and
               Trademark Maintenance  Agreement  dated as  of November 1,
               1992, by and  between MacGregor Sports  Products, Inc. and
               the Company (incorporated by  reference from Exhibit 10.25
               to the Company's  Report on Form  10-K for the  year ended
               1992).

    10.28      Assignment and Assumption Agreement, dated to be effective
               as of  February 28, 1992,  by and  between Aurora  and the
               Company (incorporated by  reference from Exhibit  10.27 to
               the Company's  Report  on  Form 10-K  for  the  year ended
               1991).

     10.29     Second Amended  and Restated  Loan and  Security Agreement
               between  the Company  and  LaSalle  Business Credit,  Inc.
               dated as of  September 9, 1997  (incorporated by reference
               from Exhibit 10.1 to the Company's Report on Form 10-Q for
               the quarter ended August 1, 1997).

     10.30     Amended Lease Agreement  entered into between  the Company
               and ACQUIPORT  DFWIP,  Inc.,  dated as  of  July  13, 1998
               (incorporated  by  reference   from  Exhibit  10   to  the
               Company's Report on Form 10-Q filed on August 14, 1998).

     10.31     Lease,  dated  July   28,  1989,  by   and  between  Merit
               Investment Partners, L.P. and the Company (incorporated by
               reference from Exhibit 10.14 to the Company's Registration
               Statement on Form S-1 (Registration No. 33-39218)).

     10.32     Industrial Lease Agreement,  dated April 25,  1994, by and
               between   the   Company   and   Centre   Development   Co.
               (incorporated  by  reference  from  Exhibit  10.1  to  the
               Company's Report on  Form 10-Q for the  quarter ended June
               30, 1994).

    10.32.1    Amendment to  Industrial  Lease Agreement,  dated  July 8,
               1994, by  and between the  Company and  Centre Development
               Co. (incorporated by reference from Exhibit 10.19.1 to the
               Company's Report on  Form 10-K  for the fiscal  year ended
               December 31, 1994).

     10.33     Lease,  dated December  2,  1991,  by  and between  Injans
               Investments  and the  Company  (incorporated  by reference
               from Exhibit 10.20  to the  Company's Report on  Form 10-K
               for the year ended December 31, 1991).

    10.33.1    First  Amendment   to  Standard  Industrial   Lease  dated
               September 12, 1996  by and between  Injans Investments and
               the  Company  (incorporated   by  reference  from  Exhibit
               10.23.1 to the Company's Report on  Form 10-K for the year
               ended November 1, 1996).

     10.34     Office Building  Lease, dated  November  20, 1992,  by and
               between the Company and Benson Associates (incorporated by
               reference from  Exhibit 10.30 to  the Company's  Report on
               Form 10-K for the year ended 1992).
<PAGE>

    Exhibit
     Number                 Description of Exhibits          



    10.35      First Amendment to  Office Building Lease,  by and between
               the Company  and Benson  Associates  dated April  25, 1994
               (incorporated  by  reference  from  Exhibit  10.2  to  the
               Company's  Report on  Form 10-Q for the quarter ended June
               30, 1994)

     10.36     License Agreement, dated as of  September 23, 1991, by and
               between  Proacq Corp.  and  the  Company (incorporated  by
               reference from  Exhibit 10.17 to  the Company's  Report on
               Form 10-K for the year ended 1991).

     10.37     Sport Supply Group  Employees' Savings Plan  dated June 1,
               1993  (incorporated by reference from Exhibit 10.27 to the
               Company's Report on Form 10-K for the year ended 1993).

     10.38     Management Services  Agreement dated  July  1, 1997  to be
               effective as of  March 7, 1997 by  and between the Company
               and Emerson (incorporated  by reference from  Exhibit 10.2
               to the Company's Report on Form 10-Q for the quarter ended
               August 1, 1997).

    10.38.1    Letter  Agreement  dated  October 18,  1997  amending  the
               Management Services Agreement (incorporated by reference
               from Exhibit 10.31.1 to the Company's Report on Form 10-K
               for the year ended September 26, 1997).

       16      Letter from  Arthur  Andersen LLP  to  the  Securities and
               Exchange Commission dated  June 24, 1997  regarding change
               in certifying accountants  (incorporated by reference from
               Exhibit 16.1  to the  Company's Report  on Form  8-K dated
               June 26, 1997).

      *23.1    Consent of Independent Auditors.
               Consent of Independent Public Accountants

      *27.1     Financial Data Schedule

       99      Pledge and Security Agreement, dated  December 10, 1996 by
               Emerson  in   favor  of  Congress   Financial  Corporation
               (incorporated  by  reference   from  Exhibit  99   to  the
               Company's Report on Form 8-K filed on December 12, 1996.

                                               
  *    Filed Herewith.