FORM 10-QSB

                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

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

                  FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1998

                                       OR

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

For the transition period from _________________________ to ___________________

                         COMMISSION FILE NUMBER 0-24928

                          THE SOLOMON-PAGE GROUP LTD.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

                DELAWARE                                  51-0353012
--------------------------------------------------------------------------------
(State or other jurisdiction of incorporation  (IRS Employer Identification No.)
Or organization)

1140 AVENUE OF THE AMERICAS, NEW YORK, NY                 10036
--------------------------------------------------------------------------------
(Address of principal executive offices)                (Zip Code)

Registrant's telephone number, including area code       (212) 764-9200
                                                  ------------------------------

                                       N/A
--------------------------------------------------------------------------------
Former  name,  former  address and former  fiscal year,  if changed  since last
report.)


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed  by  Section  13 of 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 / /

State the number of shares outstanding of each of the issuer's classes of common
equity,  as of the  latest  practicable  date:  At August 10,  1998,  there were
outstanding 5,152,282 shares of the Registrant's Common Stock, $.001 par value.

            Transitional Small Business Disclosure Format:

                                 Yes / / No /X/

<PAGE>
THE SOLOMON-PAGE GROUP LTD.
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FORM 10-QSB
QUARTERLY REPORT
FOR THE NINE MONTHS ENDED JUNE 30, 1998
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INDEX
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                          PART I: FINANCIAL INFORMATION

ITEM 1:        Financial Statements                                  Page Number
                                                                     -----------

Consolidated Balance Sheet as of June 30, 1998 [Unaudited]...................1
Consolidated Statements of Operations for the three months and nine months
ended June 30, 1998 and 1997 [Unaudited].....................................3
Consolidated Statements of Cash Flows for the three months and nine months
ended June 30, 1998 and 1997 [Unaudited].....................................4
Notes to Consolidated Financial Statements [Unaudited] ......................6

ITEM 2:        Management's Discussion and Analysis or
               Plan of Operation.............................................7


                           PART II: OTHER INFORMATION




ITEM 5:        Other Information............................................11
ITEM 6:        Exhibits and Reports on Form 8-K.............................11
SIGNATURES..................................................................12

<PAGE>

PART I.  FINANCIAL INFORMATION

              ITEM 1.  FINANCIAL STATEMENTS

THE SOLOMON-PAGE GROUP LTD.
CONSOLIDATED BALANCE SHEET
AS OF JUNE 30, 1998 [UNAUDITED]



ASSETS:
CURRENT ASSETS:
  Cash and Cash Equivalents                                         $ 1,504,109
  Short-Term Investments                                                600,562
  Accounts Receivable - [Net of Allowances of $165,000]               9,975,125
  Other Current Assets                                                  768,645
                                                                    -----------

 TOTAL CURRENT ASSETS                                                12,848,441
                                                                    -----------

 PROPERTY AND EQUIPMENT  [NET OF ACCUMULATED
   DEPRECIATION OF $996,691]                                          1,858,979
                                                                    -----------

OTHER ASSETS:
  Investments                                                         1,202,064
  Intangible Assets - [Net of Accumulated Amortization of $174,250]     689,883
  Due from Related Parties                                              162,920
  Security Deposits                                                     155,011
  Restricted Investment                                                  34,466
                                                                    -----------

 TOTAL OTHER ASSETS                                                   2,244,344
                                                                    -----------

 TOTAL ASSETS                                                       $16,951,764
                                                                    ===========


SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.


                                       1
<PAGE>
THE SOLOMON-PAGE GROUP LTD.
CONSOLIDATED BALANCE SHEET
AS OF JUNE 30, 1998 [UNAUDITED]


LIABILITIES AND STOCKHOLDERS' EQUITY:
CURRENT LIABILITIES:
  Accrued Payroll and Commissions                                   $ 4,208,762
  Accounts Payable and Accrued Liabilities                              648,328
  Income Taxes Payable                                                  250,474
  Line of Credit                                                      3,100,000
  Current Portion of Obligations Under Capital Leases                    41,233
  Other Current Liabilities                                              10,000
                                                                    -----------

  TOTAL CURRENT LIABILITIES                                           8,258,797
                                                                    -----------

COMMITMENTS AND CONTINGENCIES                                              --

LONG-TERM LIABILITIES:
  Obligations Under Capital Leases                                        4,300
  Deferred Credit                                                       504,499
                                                                    -----------

  TOTAL LONG-TERM LIABILITIES                                           508,799
                                                                    -----------

STOCKHOLDERS' EQUITY:
  Preferred Stock - Par Value $.001 Per Share; Authorized
    2,000,000 Shares, None Issued or Outstanding                           --

  Common Stock - Par Value $.001 Per Share;
    Authorized 20,000,000 Shares, 5,160,616 Shares
    Issued and 5,150,616 Shares Outstanding                               5,161

  Additional Paid-in Capital                                          8,515,307

  Treasury Stock and Warrants; 10,000 Common Shares;
    1,000,000 Warrants - At Cost                                     (1,070,248)

  Retained Earnings                                                     733,948
                                                                    -----------

  TOTAL STOCKHOLDERS' EQUITY                                          8,184,168
                                                                    -----------

  TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                        $16,951,764
                                                                    ===========


SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.

                                       2
<PAGE>
THE SOLOMON-PAGE GROUP LTD.
CONSOLIDATED STATEMENTS OF OPERATIONS
[UNAUDITED]

<TABLE>
<CAPTION>

                                                             THREE MONTHS ENDED                          NINE MONTHS ENDED
                                                                  JUNE 30,                                     JUNE 30,

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

<S>                                                   <C>                    <C>                   <C>                  <C>
REVENUE                                               $11,696,027            $7,825,054            $33,187,218          $19,577,335
                                                      -----------            ----------            -----------           ----------

SELLING EXPENSES                                        9,146,293             6,034,364             25,726,506           14,978,475

GENERAL AND ADMINISTRATIVE                              1,926,109             1,161,855              5,418,568            3,112,216

DEPRECIATION AND AMORTIZATION                             133,686                84,727                377,528              238,835
                                                      -----------            ----------            -----------           ----------

  TOTAL OPERATING EXPENSES                             11,206,088             7,280,946             31,522,602           18,329,526
                                                      -----------            ----------            -----------           ----------

 INCOME FROM OPERATIONS                                   489,939               544,108              1,664,616            1,247,809
                                                      -----------            ----------            -----------           ----------

OTHER INCOME [EXPENSES]
  Interest and Dividend Income                             28,210                31,060                 92,458               98,114
  Interest Expense                                        (77,440)               (6,281)              (141,795)             (28,450)
  Net Realized and Unrealized Gain on Investments             655                14,207                  1,144               28,885
                                                      -----------            ----------            -----------           ----------

  TOTAL OTHER INCOME [EXPENSES]                           (48,575)               38,986                (48,193)              98,549
                                                      -----------            ----------            -----------           ----------

INCOME BEFORE INCOME TAX EXPENSE                          441,364               583,094              1,616,423            1,346,358

INCOME TAX EXPENSE                                        204,147               122,261                736,804              288,473
                                                      -----------            ----------            -----------           ----------

  NET INCOME                                             $237,217              $460,833               $879,619           $1,057,885
                                                      ===========            ==========            ===========           ==========

BASIC EARNINGS PER COMMON SHARE                             $0.05                 $0.09                  $0.17               $0.21
                                                      ===========            ==========            ===========           ==========
DILUTED EARNINGS PER COMMON SHARE                           $0.04                 $0.08                  $0.14               $0.19
                                                      ===========            ==========            ===========           ==========
BASIC WEIGHTED AVERAGE SHARES                           5,131,451             5,132,582              5,131,451            5,132,582
                                                      ===========            ==========            ===========           ==========
DILUTED WEIGHTED AVERAGE SHARES                         6,150,276             5,606,026              6,091,830            5,553,501
                                                      ===========            ==========            ===========           ==========
</TABLE>



SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.

                                       3
<PAGE>
THE SOLOMON-PAGE GROUP LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS [UNAUDITED]
<TABLE>
<CAPTION>

                                                                            NINE MONTHS ENDED
                                                                                 JUNE 30,
                                                                         1998                1997
                                                                         ----                ----
OPERATING ACTIVITIES:
<S>                                                                     <C>                <C>
  Net Income                                                            $879,619           $1,057,885
                                                                   --------------       --------------
  Adjustments to Reconcile Net Income
   to Net Cash [Used for] Operating Activities:
    Depreciation and Amortization                                        377,528              238,835
    Provision for losses on Accounts Receivable                           40,000               42,000
    Deferred Credit                                                      120,636               71,417
    Net Realized and Unrealized Gain on Investments                       (1,144)             (28,885)

  Change in Assets and Liabilities:
  [Increase] Decrease in:
    Accounts Receivable                                               (2,606,098)          (2,362,326)
    Other  Assets                                                       (448,003)            (302,998)
    Security Deposits                                                    (21,839)             (14,841)

  Increase [Decrease] in:
    Accounts Payable and Accrued Expenses                              1,364,102              847,574
    Income Tax Payable                                                   (16,630)             204,577
    Other  Liabilities                                                  (261,238)              49,763
                                                                   --------------       --------------

  Total Adjustments                                                  ($1,452,686)         ($1,254,884)
                                                                   --------------       --------------

NET CASH - OPERATING ACTIVITIES-
        FORWARD                                                        ($573,067)           ($196,999)
                                                                   --------------       --------------

INVESTING ACTIVITIES:
  Capital Expenditures                                                  (715,444)            (232,843)
  Purchase of Investments                                               (599,710)          (2,696,650)
  Proceeds from Sales of Investments                                     948,655            1,941,911
  Cash Received from Related Parties                                      15,000                    0
  Purchase of Treasury Stock                                                   0              (16,250)
                                                                   --------------       --------------
NET CASH - INVESTING ACTIVITIES -
        FORWARD                                                        ($351,499)         ($1,003,832)
                                                                   --------------       --------------
</TABLE>


                                       4
<PAGE>
THE SOLOMON-PAGE GROUP LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS [UNAUDITED]

<TABLE>
<CAPTION>

                                                                          NINE MONTHS ENDED
                                                                               JUNE 30,

                                                                  1998                        1997
                                                                  ----                        ----

<S>                                                             <C>                          <C>       
NET CASH - OPERATING ACTIVITIES -
           FORWARDED                                            ($573,067)                   ($196,999)
                                                            --------------       ----------------------
NET CASH - INVESTING ACTIVITIES -
           FORWARDED                                            ($351,499)                 ($1,003,832)
                                                            --------------       ----------------------
FINANCING ACTIVITIES:
  Borrowings Under the Line of Credit                           3,100,000                       --
  Purchase of Treasury Stock and Warrants                      (1,053,998)                      --
  Payments on Capital Lease Obligations                           (54,265)                     (90,114)
  Proceeds from Exercise of Stock Options                          27,082                       --
  Payments from Related Parties                                         0                       10,000
                                                            --------------       ----------------------
  NET CASH - FINANCING ACTIVITIES                              $2,018,819                     ($80,114)
                                                            --------------       ----------------------

  NET INCREASE [DECREASE] IN CASH AND CASH EQUIVALENTS          1,094,253                   (1,280,945)

CASH AND CASH EQUIVALENTS - BEGINNING OF PERIODS                  409,856                    2,113,556
                                                            --------------       ----------------------

  CASH AND CASH EQUIVALENTS - END OF PERIODS                   $1,504,109                     $832,611
                                                            ==============       ======================

SUPPLEMENTAL CASH FLOW INFORMATION:
    Cash paid during the periods for:
          Interest                                               $141,795                      $28,450
          Income Taxes                                            776,587                      136,335
</TABLE>


SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.


                                       5
<PAGE>


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THE SOLOMON-PAGE GROUP LTD.
--------------------------------------------------------------------------------

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
[UNAUDITED]
--------------------------------------------------------------------------------

[1] BASIS OF REPORTING

The accompanying  unaudited consolidated financial statements have been prepared
in  accordance  with  generally  accepted  accounting   principles  for  interim
financial  information and with the  instructions to Form 10-QSB and Item 310(b)
of Regulation S-B.  Accordingly,  they do not include all of the information and
footnotes  required by generally  accepted  accounting  principles  for complete
financial statements.

In  the  opinion  of  management,   such  statements   include  all  adjustments
[consisting only of normal recurring items] which are considered necessary for a
fair presentation of the financial  position of the Company at June 30, 1998 and
the results of its  operations for the three and nine months ended June 30, 1998
and 1997 and cash flows for the three and nine  months  ended June 30,  1998 and
1997.  The results of operations for the periods  presented are not  necessarily
indicative  of the  results  to be  expected  for the  full  year or  subsequent
periods.

The  accompanying   unaudited  consolidated  financial  statements  include  the
accounts of The  Solomon-Page  Group Ltd. and its wholly owned  subsidiary.  All
significant  intercompany  balances and  transactions  have been  eliminated  in
consolidation.

It is suggested that these financial  statements be read in conjunction with the
audited  financial  statements and notes for the fiscal year ended September 30,
1997 included in The Solomon-Page Group Ltd. Form 10-KSB.

[2] EARNINGS PER COMMON SHARE

The  Financial  Accounting  Standards  Board has issued  Statement  of Financial
Accounting  Standards (SFAS) No. 128, Earnings per Share, which is effective for
financial  statements  issued  for  periods  ending  after  December  15,  1997.
Accordingly,  earnings per share data in the financial  statements for the three
and nine months ended June 30, 1998 and 1997 have been  calculated in accordance
with SFAS No. 128.

SFAS No. 128 supersedes Accounting Principles Board Opinion No. 15, Earnings per
Share,  and replaces its primary  earnings per share with new basic earnings per
share representing the amount of earnings for the period available to each share
of common stock outstanding  during the reporting  period.  Diluted earnings per
share reflects the amount of earnings for the period  available to each share of
common stock outstanding during the reporting period, while giving effect to all
dilutive potential common shares that were outstanding  during the period,  such
as common shares that could result from the potential  exercise or conversion of
securities  into common stock.  The dilutive  effect of outstanding  options and
warrants and their equivalents is reflected in dilutive earning per share by the
application  of the treasury  stock method which  recognizes the use of proceeds
that could be  obtained  upon  exercise of options  and  warrants  in  computing
diluted  earnings  per share.  It  assumes  that any  proceeds  would be used to
purchase common stock at the average market price during the period. Options and
warrants will have a dilutive  effect only when the average  market price of the
common  stock  during the period  exceeds  the  exercise  price of the option or
warrants.


[3] RECLASSIFICATION

Certain prior period  amounts have been  reclassified  to conform to the current
period presentation.


                                        6
<PAGE>
ITEM 2.

MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
--------------------------------------------------------------------------------

OVERVIEW

            The Company is a  specialty  niche  provider  of  staffing  services
organized into two primary operating  divisions:  temporary  staffing/consulting
and   executive   search/full-time   contingency   recruitment.   The  temporary
staffing/consulting division provides services to companies seeking personnel in
the information  technology,  accounting and human resources areas and generated
approximately  58% of the  Company's  revenue for the nine months ended June 30,
1998. The executive search/full-time  contingency recruitment division comprises
nine lines of business, including four industry (capital markets, publishing and
new media,  healthcare and fashion services),  and five functional  (information
technology,  accounting, human resources, legal and administrative support). The
executive   search/full-time    contingency   recruitment   division   generated
approximately  42% of the  Company's  revenue for the nine months ended June 30,
1998.

            The following is a summary of the Company's  consolidated  financial
and operating data.

<TABLE>
<CAPTION>

                                              THREE MONTHS ENDED                            NINE MONTHS ENDED
                                              ------------------                            -----------------
                                                   JUNE 30,                                     JUNE 30,
                                                   --------                                     --------
STATEMENT OF OPERATIONS DATA:              1998                  1997                  1998                  1997
-----------------------------              ----                  ----                  ----                  ----
<S>                                     <C>                   <C>                  <C>                    <C>        
Revenue                                 $11,696,027           $7,825,054           $33,187,218            $19,577,335
Income from Operations                      489,939              544,108             1,664,616              1,247,809
Income Before Income Tax Expense            441,364              583,094             1,616,423              1,346,358
Income Tax Expense                          204,147              122,261               736,804                288,473
Net Income                                  237,217              460,833               879,619              1,057,885
Basic Earnings Per Common Share               $0.05                $0.09                 $0.17                  $0.21
Diluted Earnings Per Common Share             $0.04                $0.08                 $0.14                  $0.19

BALANCE SHEET DATA:                         JUNE 30, 1998
-------------------                         -------------
Working Capital                              $4,589,644
Total Assets                                 16,951,764
Line of Credit                                3,100,000
Stockholders' Equity                          8,184,168
</TABLE>

RESULTS OF OPERATIONS

             The following  discussion of the Company's  financial condition and
results  of  operations  should  be  read  in  conjunction  with  the  financial
statements and notes thereto appearing elsewhere in this document.

             Revenue increased to approximately $11,696,000 for the three months
ended June 30, 1998 from  approximately  $7,825,000  for the three  months ended
June 30, 1997, an increase of  approximately  $3,871,000 or 49%.  Revenue of the
Company's temporary  staffing/consulting  division was approximately  $6,802,000
for the three months ended June 30, 1998  compared to  approximately  $4,219,000
for the same period in 1997,  an increase of  approximately  $2,583,000  or 61%.
Revenue of the  Company's  executive  search/full-time  contingency  recruitment
division  experienced  an increase of 36% to  approximately  $4,894,000  for the
three months ended June 30, 1998 compared to  approximately  $3,606,000  for the
same period in 1997.

                                        7
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION  [CONTINUED]

            Revenue  increased  approximately  $13,870,000  for the nine  months
ended June 30, 1998  compared  to  approximately  $9,628,000  for the sa Revenue
increased to  approximately  $33,187,000 for the nine months ended June 30, 1998
from  approximately  $19,577,000  for the nine months  ended June 30,  1997,  an
increase of approximately $13,610,000 or 70%. Revenue of the Company's temporary
staffing/consulting  division was approximately  $19,317,000 for the nine months
ended June 30, 1998 compared to approximately  $9,949,000 for the same period in
1997, an increase of  approximately  $9,368,000 or 94%. Revenue of the Company's
executive search/full-time  contingency recruitment division increased 44% to me
period in 1997.

             The  increase in revenue  for the three and nine months  ended June
30, 1998  compared to the three and nine months ended June 30, 1997 division was
due to expansion of the Company's temporary  staffing/consulting division within
the areas of accounting,  human resource and information technology.  Revenue of
the Company's  information  technology  temporary  staffing/consulting  business
experienced  significant  increases in revenue to  approximately  $5,822,000 and
$16,587,000  for the three and nine  months  ended June 30,  1998  respectively,
compared to  approximately  $3,772,000  and  $9,450,000  for the same periods in
1997,  an  increase of 54% and 76%,  respectively.  In  addition,  the hiring of
revenue-generating  personnel within various lines of business and strong demand
for personnel  from existing as well as new clients  contributed to the increase
in revenue.

            Selling  expenses  for the three  months ended June 30, 1998 totaled
approximately   $9,146,000  (78%  of  revenues)   compared  with   approximately
$6,034,000  (77% of revenues) for the three months ended June 98, 1997.  Selling
expenses  for  the  nine  months  ended  June  30,  1998  totaled  approximately
$25,730,000 (78% of revenues)  compared with  approximately  $14,978,000 (77% of
revenues)  for the nine  months  ended June 30,  1997.  The  increase in selling
expenses as a  percentage  of revenue is primarily  related to costs  associated
with payroll requirements within the temporary  staffing/consulting division. In
addition,  costs  associated  with hiring  revenue-generating  personnel  within
various lines of business,  contributed  to these  increases.  Selling  expenses
consist  primarily  of  temporary   staffing/consulting  payroll,  salaries  and
commissions of revenue-generating  personnel,  employee benefits,  telephone and
advertising.

            General  and  Administrative  expenses  increased  to  approximately
$1,926,000  (17% of revenues) and $5,420,000 (16% of revenues) for the three and
nine  months  ended  June  30,  1998  respectively,  compared  to  approximately
$1,162,000  (15% of revenues) and $3,112,000 (16% of revenues) for the three and
nine months  ended June 30, 1997  respectively.  The increase is a result of the
hiring of additional support personnel within corporate accounting,  information
systems  and  administration.  Also,  the  Company has  incurred  various  costs
associated with additional office space.

             Other  Income  [Expenses]  for the three and nine months ended June
30, 1998 totaled ($49,000) and ($48,000)  respectively,  compared to $39,000 and
$99,000  for the same  period in 1997.  The  increase  in other  expense was due
primarily to interest expense charged for borrowings under the Company's line of
credit.

            Depreciation and Amortization  expense for the three and nine months
ended June 30, 1998 totaled  approximately  $134,000 and $378,000  respectively,
compared to approximately $85,000 and $239,000 for the same periods in 1997. The
increase  is due to  increased  capital  expenditures  and the  amortization  of
intangible assets related to the acquisition of trade names.

             Income from  operations was  approximately  $490,000 and $1,665,000
for the three and nine  months  ended June 30,  1998  respectively,  compared to
approximately  $544,000 and  $1,248,000 for the three and nine months ended June
30, 1997. The increases are primarily the result of the above mentioned factors.

                                        8
<PAGE>

MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION  [CONTINUED]
--------------------------------------------------------------------------------

            Income Tax Expense for the three and nine months ended June 30, 1998
was $204,000  (46%  effective  tax rate) and $736,000  (46%  effective tax rate)
respectively,  compared to $122,000  (21%  effective tax rate) and $288,000 (21%
effective tax rate) for the same periods in 1997. The lower  effective tax rates
for the three and nine months ended June 30, 1997 were primarily a result of net
operating loss carryforwards utilized in those periods.

             Net income was  approximately  $237,000  and $880,000 for the three
and nine months  ended June 30,  1998  respectively,  compared to  approximately
$461,000 and $1,057,000 for the three and nine months ended June 30, 1997.

LIQUIDITY AND CAPITAL RESOURCES

             As of June 30, 1998,  the Company's  sources of liquidity  included
approximately   $2,105,000  in  cash  and  cash   equivalents   and   short-term
investments.  The Company's  working capital at June 30, 1998 was  approximately
$4,762,000.  In addition, the Company has available approximately  $1,202,000 of
long term investments as a source of liquidity if required.

              On October 31, 1997, the Company's  Board of Directors  authorized
the  repurchase  of up to 1,000,000 of the Company's  Class A redeemable  common
stock purchase warrants in open market or privately negotiated transactions.  On
February 12, 1998,  the Company  completed the  repurchase of 1,000,000  Class A
redeemable common stock purchase warrants at a cost of $1,053,997.

             In February  1998, the Company  entered into a one-year  $4,000,000
demand line of credit  facility  agreement with The Dime Savings Bank,  which is
collateralized  by  all  the  Company's  assets.   The  agreement  provides  for
borrowings at 1% above the Dime Reference Rate (Dime  Reference Rate at June 30,
1998 was 8.5%), in amounts not exceeding 80% of eligible accounts receivable (as
defined therein) and expires on February 28, 1999, on which date the outstanding
principal amount is required to be repaid.  As of June 30, 1998, the Company had
borrowed   approximately   $3,100,000  under  this  credit  facility,  of  which
approximately  $1,054,000 was used for the  repurchase of the Company's  Class A
redeemable  common  stock  purchase  warrants  and the  balance to fund  current
working capital requirements.

            Cash flows used in operating activities were approximately  $573,000
for the nine months ended June 30, 1998. The primary use of cash was to fund the
increase in accounts receivable related to higher revenues.  Accounts receivable
increased approximately $2,597,000 compared to September 30, 1997. Cash provided
by  financing   activities   for  the  nine  months  ended  June  30,  1998  was
approximately  $2,019,000,  which was  primarily due to $3,100,000 of borrowings
under the line of credit and $1,054,000 used for the repurchase of the Company's
Class A redeemable common stock purchase warrants

            The Company  believes that its current cash position and  investment
balances,  together with financing  available under its working capital facility
will be sufficient to support current working capital  requirements for the next
twelve months.

            Many computer systems in use today were designed and developed using
two digits,  rather than four, to specify years. As a result,  such systems will
recognize the year 2000 as "00". This could cause many computer  applications to
fail or to create erroneous  results unless  corrective  measures are taken. The
Company utilizes software or related computer technologies that are essential to
its  operations.  The Company  believes all such software is currently Year 2000
compliant,  and does not expect any material impact as a result of the Year 2000
issue.


                                        9
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION  [CONTINUED]
--------------------------------------------------------------------------------

NEW AUTHORITATIVE ACCOUNTING PRONOUNCEMENTS

             The  Financial  Accounting  Standards  Board  ["FASB"]  has  issued
Statement of Financial  Accounting  Standards,  [SFAS] No. 129,  "Disclosure  of
Information  about Capital  Structure," in February 1997.  SFAS No. 129 does not
change any previous disclosure  requirements,  but rather consolidates  existing
disclosure requirements for ease of retrieval.

             The Financial  Accounting Standards Board ["FASB"] issued Statement
of Financial  Accounting  Standards ["SFAS"] No. 130,  "Reporting  Comprehensive
Income." SFAS No. 130 is effective for fiscal years beginning after December 15,
1997. Earlier application is permitted. Reclassification of financial statements
for earlier periods provided for comparative purposes are required.  The Company
is in the process of determining its preferred format.  The adoption of SFAS No.
130 will have no impact on the  Company's  consolidated  results of  operations,
financial position or cash flows.

              The FASB has issued SFAS No. 131,  "Disclosures  about Segments of
an  Enterprise  and Related  Information."  SFAS No. 131  changes how  operating
segments are reported in annual  financial  statements and require the reporting
of selected  information  about operating  segments in interim financial reports
issued to  shareholders.  SFAS No. 131 is effective for periods  beginning after
December  15,  1997,  and  comparative  information  for earlier  years is to be
restated.  SFAS No. 131 need not be applied to interim  financial  statements in
the initial year of its application. The Company is in the process of evaluating
the disclosure requirements. The adoption of SFAS No. 131 will have no impact on
the Company's  consolidated  results of operations,  financial  position or cash
flows.



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<PAGE>
PART II:    OTHER INFORMATION

ITEM 5.     OTHER INFORMATION

             In accordance  with recent  amendments to the proxy rules under the
Securities  Exchange Act of 1934,  as amended,  the Company's  stockholders  are
notified  that the  deadline  for  providing  the Company  timely  notice of any
stockholder  proposal  to be  submitted  outside of the Rule 14a-8  process  for
consideration  at the  Company's  1999 Annual  Meeting of  Stockholders  will be
January 23,  1999.  As to all such matters as to which the Company does not have
notice on or prior to January 23, 1999, discretionary authority shall be granted
to the designated persons in the Company's proxy for such Annual Meeting.



ITEM 6.     EXHIBITS AND REPORTS ON FORM 8-K

            (A)         EXHIBITS:

                        27    Financial Data Schedule

            (B)         REPORTS ON FORM 8-K: NONE







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<PAGE>
                           THE SOLOMON-PAGE GROUP LTD.
                                   SIGNATURES



In accordance with the  requirements of the Securities  Exchange Act of 1934, as
amended,  the  Registrant  caused  this report to be signed on its behalf by the
undersigned thereunto duly authorized.


                                      THE SOLOMON-PAGE GROUP LTD.
                                      ------------------------------------------
                                                 (Registrant)




        Date:  August 10, 1998        /S/ LLOYD B. SOLOMON
                                      ------------------------------------------
                                      Lloyd B. Solomon, Chief Executive Officer




        Date:  August 10, 1998        /S/ ERIC M. DAVIS
                                      ------------------------------------------
                                      Eric M. Davis, Chief Financial Officer
                                      Vice President - Finance






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