<TABLE>
<CAPTION>
                                                                     Exhibit 13
Consolidated Statements of Earnings
Alberto-Culver Company and Subsidiaries

                                                                                                       Year ended September 30,
<S>                                                                                           <C>
(Dollars in thousands, except per share data)                                                       1997        1996          1995
Net sales                                                                                     $1,775,258   1,590,409     1,358,219
Costs and expenses:
Cost of products sold                                                                            880,416     805,080       682,589
Advertising, promotion, selling and administrative                                               766,117     673,247       584,856

   Interest expense, net of interest income of $3,588 in 1997, $3,837 in 1996
     and $3,414 in 1995                                                                            8,238      12,068         6,532
  Non-recurring gain (note 8)                                                                    (15,634)        --            --
                                                                                                 -------      ------        ------  
     Total costs and expenses                                                                  1,639,137   1,490,395     1,273,977
Earnings before provision for income taxes                                                       136,121     100,014        84,242
Provision for income taxes (note 6)                                                               50,704      37,270        31,591
                                                                                                  ------      ------        ------
Net earnings                                                                                     $85,417      62,744        52,651
                                                                                                 =======      ======        ======

Net earnings per share:
  Primary                                                                                          $1.49        1.11          .95
Fully-diluted                                                                                      $1.41        1.06          .94

See accompanying notes to consolidated financial statements.
</TABLE>



                                                     - 278 -


<PAGE>

<TABLE>
<CAPTION>

Consolidated Statements of Retained Earnings
Alberto-Culver Company and Subsidiaries

<S>                                                                                 <C>               <C>            <C>
                                                                                                 Year ended September 30,
(Dollars in thousands)                                                                  1997             1996           1995

Retained earnings, beginning of year                                                $390,526          337,506        293,445
Net earnings                                                                          85,417           62,744         52,651
                                                                                     475,943          400,250        346,096
Stock dividend (note 4)                                                               (6,148)              --             --
Cash dividends  (note 4)                                                             (10,909)          (9,724)        (8,590)
                                                                                     -------           ------         ------ 
Retained earnings, end of year                                                      $458,886          390,526        337,506
                                                                                    ========          =======        =======

See accompanying notes to consolidated financial statements.
</TABLE>


                                                     - 279 -


<PAGE>


<TABLE>
<CAPTION>


Consolidated Balance Sheets
Alberto-Culver Company and Subsidiaries

(Dollars in thousands, except per share data)                                                     September 30, 

<S>                                                                                           <C>            <C> 
                                                                                              1997           1996
Assets
Current assets:
   Cash and cash equivalents                                                         $      76,040         66,211
   Short-term investments                                                                   11,560          5,346
   Receivables, less allowance for doubtful accounts of $9,042 in 1997
      and $8,208 in 1996 (note 3)                                                          120,774        125,718
   Inventories:
      Raw materials                                                                         44,175         31,286
      Work-in-process                                                                        7,252          5,622
      Finished goods                                                                       292,441        251,617
                                                                                           -------        -------
         Total inventories                                                                 343,868        288,525
   Prepaid expenses                                                                         28,017         26,918
                                                                                            ------         ------
         Total current assets                                                              580,259        512,718
                                                                                           -------        -------
Property, plant and equipment (note 7):
   Land                                                                                     10,357          9,310
   Buildings                                                                               124,920        113,775
   Machinery and equipment                                                                 214,876        196,781
                                                                                           -------        -------
      Total property, plant and equipment                                                  350,153        319,866
   Accumulated depreciation                                                                159,155        143,946
                                                                                           -------        -------
      Property, plant and equipment, net                                                   190,998        175,920
Goodwill, net                                                                              114,245        107,603
Trade names, net                                                                            70,155         76,877
Other assets                                                                                44,402         36,148
                                                                                            ------         ------
                                                                                        $1,000,059        909,266
                                                                                        ==========        =======


Liabilities and Stockholders' Equity

Current liabilities:
   Short-term borrowings                                                             $       3,582          2,337
   Current maturities of long-term debt                                                      1,361          1,313
   Accounts payable                                                                        174,322        154,634
   Accrued expenses (note 2)                                                               118,447        115,139
   Income taxes                                                                             13,540         13,172
                                                                                            ------         ------
      Total current liabilities                                                            311,252        286,595
Long-term debt (note 3)                                                                     49,441         61,548
Convertible subordinated debentures (note 3)                                               100,000        100,000
Deferred income taxes                                                                       25,490         16,582
Other liabilities                                                                           16,872         19,445
Stockholders' equity (note 4): Common stock, par value $.22 per share:
      Class A authorized 75,000,000 shares; issued 24,442,931 shares
         in 1997 and 24,311,224 in 1996                                                      5,378          2,918
      Class B authorized 75,000,000 shares; issued 37,710,664 shares                         8,296          4,608
   Additional paid-in capital                                                               91,222         88,955
   Retained earnings                                                                       458,886        390,526
   Foreign currency translation (note 1)                                                   (22,555)       (13,428)
                                                                                           -------        ------- 
                                                                                           541,227        473,579
   Less treasury stock, at cost (Class A common stock: 1997 - 1,833,315 shares
      and 1996 - 2,214,024 shares;  Class B common stock: 1997 and
      1996 - 4,178,184 shares)  (note 4)                                                   (44,223)       (48,483)
                                                                                           -------        ------- 
      Total stockholders' equity                                                           497,004        425,096
                                                                                           -------        -------
                                                                                        $1,000,059        909,266
                                                                                        ==========        =======

See accompanying notes to consolidated financial statements.
</TABLE>

                                                     - 280 -


<PAGE>


<TABLE>
<CAPTION>


Consolidated Statements of Cash Flows
Alberto-Culver Company and Subsidiaries

(Dollars in thousands)                                                                                 Year ended September 30,
<S>                                                                                         <C>              <C>              <C> 
                                                                                            1997             1996             1995

Cash Flows from Operating Activities:
Net earnings                                                                              $85,417           62,744           52,651
Adjustments to reconcile net earnings to net cash provided by operating activities:
     Depreciation                                                                         30,177           26,159           20,712
     Amortization of goodwill, trade names and other assets                                8,760            6,757            3,967
     Non-recurring gain                                                                  (15,634)              --               --
     Deferred income taxes                                                                 7,420           (1,858)             243
     Other, net                                                                           (3,470)          (1,527)             852
     Cash effects of changes in:
      Receivables, net                                                                       296           (2,955)         (20,144)
      Inventories                                                                        (51,881)         (12,287)          (7,783)
      Prepaid expenses                                                                    (1,196)             302           (1,940)
      Accounts payable and accrued expenses                                               17,665           17,930           29,420
      Income taxes                                                                         2,174           (2,520)           3,852
                                                                                           -----           ------            -----
      Net cash provided by operating activities                                           79,728           92,745           81,830
                                                                                          ------           ------           ------
Cash Flows from Investing Activities:
Short-term investments                                                                    (6,214)            (946)           4,129
Capital expenditures                                                                     (58,196)         (40,894)         (31,002)
Other assets                                                                              (7,585)          (7,313)          (8,143)
Proceeds from sale of business                                                                --           12,448              --
Payments for purchased businesses, net of acquired
   companies' cash                                                                       (15,628)        (130,981)         (41,635)
Proceeds from insurance settlement                                                        28,000               --               --
Proceeds from disposals of assets                                                          2,044            1,599            1,006
                                                                                           -----            -----            -----
     Net cash used by investing activities                                               (57,579)        (166,087)         (75,645)
                                                                                         -------         --------          ------- 
Cash Flows from Financing Activities:
Short-term borrowings                                                                      1,436             (315)          (2,091)
Proceeds from issuance of long-term debt                                                     550            5,475           45,001
Repayments of long-term debt                                                              (6,116)         (29,118)         (37,773)
Issuance of convertible subordinated debentures                                               --               --          100,000
Convertible subordinated debentures issuance costs                                            --               --           (2,945)
Proceeds from sale of receivables                                                             --           30,000             --
Proceeds from exercise of stock options                                                    5,560            1,717              659
Cash dividends paid                                                                      (10,909)          (9,724)          (8,590)
Stock purchased for treasury                                                              (1,138)            (759)             --
                                                                                          ------             ----           ------
     Net cash provided (used) by financing activities                                    (10,617)          (2,724)          94,261
                                                                                         -------           ------           ------
Effect of foreign exchange rate changes on cash                                           (1,703)            (308)             306
                                                                                          ------             ----              ---
Net increase (decrease) in cash and cash equivalents                                       9,829          (76,374)         100,752
Cash and cash equivalents at beginning of year                                            66,211          142,585           41,833
                                                                                          ------          -------           ------
Cash and cash equivalents at end of year                                                 $76,040           66,211          142,585
                                                                                         =======           ======          =======


Supplemental Cash Flow Information:
Cash paid for:
   Interest                                                                            $   11,478          16,333            6,831
   Income taxes                                                                        $   42,299          42,589           26,801
Capital lease obligations assumed                                                      $      240             282            1,393


See accompanying notes to consolidated financial statements.
</TABLE>

                                                     - 281 -


<PAGE>



Notes to Consolidated Financial Statements

(1) Summary of Significant Accounting Policies

PRINCIPLES OF CONSOLIDATION
The consolidated financial statements include accounts of Alberto-Culver Company
and its  subsidiaries  ("company").  All significant  intercompany  accounts and
transactions  have been eliminated.  Certain amounts for prior periods have been
reclassified to conform to the current year's presentation.

The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets, liabilities, revenues and expenses in the
financial  statements.  Management  believes these estimates and assumptions are
reasonable.

CASH EQUIVALENTS
All highly  liquid  investments  purchased  with an  original  maturity of three
months or less are  considered to be cash  equivalents.  These  investments  are
stated at cost which approximates market value.

SHORT-TERM INVESTMENTS
Short-term  investments  are  stated at cost  which is equal to market  value at
September 30, 1997 and 1996, respectively.

INVENTORIES
Inventories  are  stated at the  lower of cost  (first-in,  first-out  method or
retail method) or market (net realizable value).

PROPERTY, PLANT AND EQUIPMENT
Property,  plant and  equipment  are carried at cost.  Depreciation  is provided
primarily on the  straight-line  method based on the  estimated  useful lives of
assets. Expenditures for maintenance and repairs are expensed as incurred.

GOODWILL AND TRADE NAMES
The cost of goodwill and trade names is amortized on a straight-line  basis over
periods  ranging  from ten to forty  years.  Management  periodically  considers
whether there has been a permanent impairment to the value of goodwill and trade
names by evaluating various factors including current operating results,  market
and  economic   conditions  and  anticipated  future  results  and  cash  flows.
Accumulated  amortization  at September  30, 1997 and 1996 was $23.8 million and
$17.3 million, respectively.

FOREIGN CURRENCY TRANSLATION
Foreign  currency  balance sheet accounts are translated at rates of exchange in
effect at the balance sheet date. Results of operations are translated using the
average exchange rates during the period.

The following is an analysis of changes in the foreign currency translation 
account:

(Thousands)                                      1997          1996
                                             
Balance, beginning of year                    $(13,428)      (12,966)
Foreign currency translation loss               (9,127)         (462)
                                                ------          ---- 
Balance, end of year                          $(22,555)      (13,428)

Realized  gains and losses from foreign  currency  transactions  included in the
consolidated statements of earnings resulted in losses of $1.2 million,  $17,000
and $359,000 in 1997, 1996 and 1995, respectively.



ADVERTISING, PROMOTION AND MARKET RESEARCH
Advertising,  promotion and market  research  costs are expensed as incurred and
amounted to $255.3 million,  $208.4 million and $188.0 million in 1997, 1996 and
1995, respectively.




INCOME TAXES
Deferred   income  taxes  are  recognized   for  the  future  tax   consequences
attributable to differences  between the financial statement carrying amounts of
existing  assets and liabilities  and their  respective tax bases.  Deferred tax
assets and liabilities are measured using enacted tax rates expected to apply to
taxable income in the years in which  temporary  differences are estimated to be
recovered or settled.

CALCULATION OF EARNINGS PER SHARE
Primary earnings per share are based on the weighted average shares outstanding,
including common stock  equivalents,  of 57,202,000 in 1997,  56,426,000 in 1996
and 55,698,000 in 1995.


                                                     - 282 -


<PAGE>



Fully-diluted  earnings per share are  determined  by dividing net earnings plus
interest expense (net of tax benefit) on the convertible subordinated debentures
by the weighted  average  shares  outstanding,  after  giving  effect for common
shares  to  be  issued  assuming  conversion  of  the  convertible  subordinated
debentures  to common shares and other common stock  equivalents.  Fully-diluted
weighted average shares outstanding were 63,637,000 in 1997,  62,776,000 in 1996
and 57,152,000 in 1995.

STOCK-BASED COMPENSATION
Statement of Financial  Accounting  Standards  (SFAS) No. 123,  "Accounting  for
Stock-Based  Compensation",  requires  either the adoption of a fair value based
method of accounting for stock-based compensation or pro-forma disclosures as if
the fair value method was adopted. The company has elected to continue measuring
compensation  expense for its stock-based plans using the intrinsic value method
prescribed by Accounting  Principles Board (APB) Opinion No. 25, "Accounting for
Stock Issued to Employees". Pro forma disclosures assuming the fair value method
prescribed  by SFAS No.  123 had been used to  measure  compensation  expense is
provided in note 5.


(2) Accrued Expenses

Accrued expenses consist of the following:

(Thousands)                                        1997         1996
Compensation and benefits                     $   51,549       48,960
Advertising and promotions                        29,312       28,085
Other                                             37,586       38,094
                                                  ------       ------
                                              $  118,447      115,139
                                                 =======      =======










(3) Debt and Other Financing Arrangements


Long-term debt, exclusive of current maturities, consists of the following:

(Thousands)                                       1997                 1996
5.5% convertible subordinated                   
   debentures due June, 2005                    100,000             100,000

6.2% term note due                               
   September, 2000                               20,000              20,000

Revolving Swedish krona credit                   
   agreements at 4.4% - 11.7%                    27,736              39,200

Other, principally foreign borrowings                                          
   and capitalized leases, at weighted
   average interest rates of 7.6% in
   1997 and 8.2% in 1996                          1,705               2,348
                                                  -----               -----

                                                $149,441            161,548
                                                ========            =======











                                                     - 283 -


<PAGE>



Maturities of debt for the next five years are as follows (in thousands):  
1998 - $1,361; 1999 - $798; 2000 - $48,112; 2001 - $312;  2002 - $176; 2003
and later  $100,043.  The fair value of long-term debt approximates its recorded
value.

The 5.5% convertible subordinated debentures are convertible into Class A common
shares at a  conversion  rate of 61.776  shares per $1,000  principal  amount of
debentures  (equivalent to a conversion  price of approximately  $16-3/16).  The
debentures  are  redeemable,  in whole  but not in part,  at the  option  of the
company any time on or after June 30, 1998 at par plus accrued interest.


The  company has a $200  million  revolving  credit  facility  which  expires in
September,  2002.  The facility,  which is undrawn at September 30, 1997, can be
increased  to $300 million  under  certain  conditions  and may be drawn in U.S.
dollars or certain foreign currencies.

In January, 1997, the company renewed an agreement to sell, without recourse, up
to $30 million of a designated  pool of trade  receivables  on an ongoing basis.
The  agreement  expires in one year and is  renewable  annually  upon the mutual
consent of both parties. At September 30, 1997, the facility was fully utilized.
Costs related to this agreement are included in administrative expenses.

The  revolving  credit  facility,  the  term  note due  September,  2000 and the
receivables  agreement impose  restrictions on such items as total debt, working
capital,  dividend payments,  treasury stock purchases and interest expense.  At
September 30, 1997, the company was in compliance  with these  arrangements  and
$163.2 million of  consolidated  retained  earnings was not restricted as to the
payment of dividends or purchases of treasury stock.

(4) Treasury Stock and Additional Paid-In Capital

Changes in treasury stock and additional  paid-in  capital during 1997, 1996 and
1995 were as follows:
                                                       Additional
                                     Treasury Stock      Paid-In
(Thousands)                         Shares    Amount     Capital
-----------                         ------    ------     -------

Balance at September 30, 1994       6,527     $49,660    $87,452
Stock options exercised               (33)       (399)       260
Stock issued pursuant to
   employee incentive plans           (16)       (202)       184
                                      ---        ----        ---
Balance at September 30, 1995       6,478      49,059     87,896
Stock options exercised               (84)     (1,029)       688
Stock purchased for treasury           23         759         --
Stock issued pursuant to
   employee incentive plans           (25)       (306)       371
                                      ---        ----        ---
Balance at September 30,1996        6,392      48,483     88,955
Stock options exercised              (359)     (4,389)     1,663
Stock purchased for treasury           56       1,138         --
Stock issued pursuant to
   employee incentive plans           (78)     (1,009)       604
                                      ---      ------        ---
Balance at September 30, 1997       6,011     $44,223    $91,222
                                    =====     =======    =======

The company has two classes of common stock, both of which are listed on the New
York Stock  Exchange.  Except for voting,  dividend and conversion  rights,  the
Class A and Class B common stock are  identical.  Class A has one-tenth vote per
share and Class B has one vote per share. No dividend may be paid on the Class B
unless an equal or greater dividend is paid on the Class A, and dividends may be
paid on the Class A in excess of dividends paid, or without paying dividends, on
the  Class B.  All,  and not less  than  all,  of the Class A may at any time be
converted into Class B on a share-for-share  basis at the option of the company.
The Class B is convertible into Class A on a share-for-share basis at the option
of the holders.

Cash dividends for Class B common stock in 1997, 1996 and 1995 were $6.5 million
or $.195 per share,  $5.9  million or $.175 per share and $5.2  million or $.155
per share,  respectively.  Cash dividends for Class A common stock in 1997, 1996
and 1995 were $4.4  million or $.195 per share,  $3.9 million or $.175 per share
and $3.4  million  or  $.155  per  share,  respectively.  Class A  common  stock
dividends  per share have been equal to those of Class B common  stock since the
Class A shares were issued in April, 1986.

At the  company's  annual  meeting in January,  1997,  stockholders  approved an
increase in both Class A and Class B authorized shares from 25,000,000 shares to
75,000,000 shares.

In January,  1997, the board of directors declared a 100% stock dividend on both
the Class A and Class B outstanding shares effective  February,  1997. The stock
dividend was  distributed  only on outstanding  shares and not on shares held in
the treasury. An amount equal to the twenty-two cents per share par value of the
additional  shares was transferred  from retained  earnings to common stock. All
share and per share  information in this report,  except for treasury shares and
the twenty-two  cents per share par value, has been restated to reflect the 100%
stock dividend. Notes Continued


                                                     - 284 -


<PAGE>



(5) Stock Option and Restricted Stock Plans

Pursuant  to its  stock  option  plans,  the  company  is  authorized  to  issue
non-qualified options to employees and directors to purchase a limited number of
shares of the  company's  Class A common stock at a price not less than the fair
market value of the stock on date of grant.  Options under the plans expire five
or ten years from date of grant and are  exercisable  on a  cumulative  basis in
four equal  annual  increments  commencing  one year after the date of grant.  A
total of 6.5 million shares have been authorized to be issued under the plans.

The company  accounts  for its stock  option plans under APB Opinion No. 25 and,
accordingly,  no  compensation  cost has  been  recognized  in the  consolidated
statements of earnings. Had compensation expense for these plans been determined
based upon the fair value of stock options on the dates of grant and  recognized
over the four-year  vesting period  consistent  with SFAS No. 123, the company's
pro-forma net earnings and earnings per share for the years ended  September 30,
1997,  1996 and 1995 would have been as follows (in thousands,  except per share
amounts):

                                          1997       1996       1995

Net earnings:
   As reported                           $85,417     62,744     52,651
   Pro-forma                             $83,572     61,688     52,170
Primary earning per share:
   As reported                             $1.49       1.11       0.95
   Pro-forma                               $1.46       1.09       0.94
Fully-diluted earnings per share:
   As reported                             $1.41       1.06       0.94
   Pro-forma                               $1.37       1.04       0.93

The weighted  average  fair value of options at the date of grant in 1997,  1996
and 1995 was $5.72, $3.67 and $3.21 per option, respectively.  The fair value of
each option  grant was  estimated  on the date of grant using the  Black-Scholes
option pricing model with the following assumptions:

                                 1997            1996           1995
                              
Expected life                   5 years         5 years        5 years
Volatility                      18.7%           18.7%          18.7%
Risk-free interest rate         6.7%-6.8%       6.0%-6.9%      6.4%
Dividend yield                  0.8%-0.9%       1.1%-1.2%      1.2%


Summarized  information on the company's  outstanding stock options at September
30, 1997 is as follows (shares in thousands):
                                                                Options
                                 Options Outstanding          Exercisable
                                 -------------------          -----------
                                    Average      Weighted          Weighted
Range of                 Number     Remaining     Average  Number   Average
Exercise                 of         Contractual   Option    of      Option
Prices                   Options    Life           Price  Options    Price
------                   -------    ----           -----  -------    -----

$6.63-$9.94                 433     4.5 years     $  9.61   373    $  9.59
$10.73-$13.38             1,920     7.2 years      $12.42   908     $12.03
$16.25-$21.72               902     9.1 years      $19.58    15     $16.47







                                                     - 285 -


<PAGE>







Stock  option  activity  under the plans is  summarized  as  follows  (shares in
thousands):
                                                   Number      Weighted
                                                     of         Average
                                                   Options   Option Price
                                                   -------   ------------

 Outstanding at September 30, 1994                 1,320        $10.41
 Granted                                           1,046         11.84
 Exercised                                           (65)        10.10
 Canceled                                            (71)        11.50         
                                                     ---                       
Outstanding at September 30, 1995                  2,230         11.06
 Granted                                           1,031         13.59
 Exercised                                          (167)        10.30
 Canceled                                           (105)        12.24
                                                    ----         
Outstanding at September 30, 1996                  2,989         11.93
 Granted                                             888         19.80
 Exercised                                          (490)        11.35
 Canceled                                           (132)        15.33
                                                    ----         
Outstanding at September 30, 1997                   3,255       $14.03
                                                    =====      
Exercisable at September 30:
 1995                                                732        $10.35
 1996                                              1,054        $10.80
 1997                                              1,296        $11.38


The company is also  authorized to grant up to 500,000  shares of Class A common
stock to employees under its restricted  stock plan. The restricted  shares vest
on a cumulative  basis in four equal annual  installments  commencing four years
after the date of grant.  During 1997,  employees were granted 77,000 restricted
shares at a weighted  average fair value of $20.73 per share.  At September  30,
1997, there were 150,500 restricted shares outstanding.

(6) Income Taxes


The provisions for income taxes consist of the following:
(Thousands)          1997            1996            1995

Current:       
  Federal         $31,553           27,651         20,820
  Foreign           5,716            5,566          5,310
  State             6,015            5,911          5,218
                    -----            -----          -----
                    3,284           39,128         31,348
                    -----           ------         ------
Deferred:
  Federal           4,849          (2,349)           (213)
  Foreign           2,549           1,268             561
  State                22            (777)           (105)
                       --            ----            ---- 
                    7,420          (1,858)            243
                    -----          ------             ---
                  $50,704          37,270          31,591
                  =======          ======          ======


The difference between the effective income tax rate and the United States
statutory federal income tax rate is summarized below:

                                      1997              1996              1995

Statutory tax rate                    35.0%             35.0%             35.0%
Effect of foreign
  income tax rates                    (1.3)             (1.5)             (1.0)
State income taxes, net
  of federal tax benefit               2.9               3.3               3.9
Other, net                              .7                .5               (.4)
                                        --                --               --- 

Effective tax rate                    37.3%             37.3%             37.5%
                                      ====              ====              ==== 



                                      - 286 -


<PAGE>








Significant  components of the company's  deferred tax assets and liabilities at
September 30, 1997 and 1996 are as follows:

(Thousands)                                      1997           1996

 Deferred tax assets attributable to:        
    Accrued expenses                           $16,456         15,802
    Inventory adjustments                          996          2,045
    Other                                        2,352             --
                                                 -----         ------          
Total deferred tax assets                       19,804         17,847
                                                ------         ------
Deferred tax liabilities attributable to:
    Depreciation and amortization               27,503         15,785
    State income taxes                             339            318
    Other                                         --              479
                                                ------            ---
 Total deferred tax liabilities                 27,842         16,582
                                                ------         ------
Net deferred tax assets (liabilities)          $(8,038)         1,265
                                               =======          =====

Prepaid  expenses at September 30, 1997 and 1996 include $17.5 million and $17.8
million, respectively, of net deferred tax assets.

Domestic  earnings  before income taxes were $110.9  million,  $77.9 million and
$72.0  million in 1997,  1996 and 1995,  respectively.  Foreign  operations  had
earnings  before income taxes of $25.2 million,  $22.1 million and $12.2 million
in 1997, 1996 and 1995, respectively.

Undistributed  earnings of the company's foreign operations  amounting to $115.2
million are intended to remain permanently invested to finance future growth and
expansion.  Accordingly,  no U.S.  income  taxes  have  been  provided  on those
earnings at September 30, 1997. Should such earnings be distributed,  the credit
for foreign income taxes paid would substantially  offset applicable U.S. income
taxes.

(7) Lease Commitments

The major portion of the company's  leases are for Sally Beauty Company  stores.
Other leases cover certain  manufacturing  and  warehousing  properties,  office
facilities,  data processing  equipment and automobiles.  At September 30, 1997,
future minimum payments under noncancelable leases are as follows:


                                  Operating                  Capital
(Thousands)                          Leases                   Leases

1998                                $43,633                     893
1999                                 35,066                     274
2000                                 25,793                     160
2001                                 17,513                      68
2002                                  9,616                       9
2003 and later                       12,271                     --
                                     ------                   -----     
Total minimum lease payments       $143,892                   1,404


Total rental expense for operating leases amounted to $59.6 million in 1997,
$53.0 million in 1996 and $47.4 million in 1995.  Certain leases require
the company to pay real estate taxes, insurance, maintenance and special 
assessments.

(8) Non-Recurring Gain


In the first quarter of 1997,  the company  received a $28.0  million  insurance
settlement from the loss of its corporate airplane.  The effect on the company's
earnings was a  non-recurring  pre-tax gain of $15.6  million and an increase in
net earnings of $9.8 million. Accordingly,  earnings per share increased $.17 on
a primary basis and $.16 on a fully-diluted basis.








                                                     - 287 -


<PAGE>




The following table provides pro-forma  information  excluding the non-recurring
gain (in thousands, except per share data):

                                                 1997          1996

Pre-tax earnings                               $120,487      100,014
Net earnings                                  $  75,606       62,744
Net earnings per share:
   Primary                                        $1.32         1.11
   Fully-diluted                                  $1.25         1.06

                                                     - 288 -


<PAGE>



(9) Business Segments and Geographic Area Information

The  "consumer  products"  business  segment  principally  includes  developing,
manufacturing,  distributing and marketing branded consumer  products  worldwide
and  includes  the  company's   Alberto-Culver   USA  and  Alberto-Culver
International  business units.  This segment also includes products intended for
end use by  institutions  and industries and the  manufacturing  of custom label
products for other companies.

The "specialty  distribution - Sally" business  segment consists of Sally Beauty
Company, a specialty distributor of professional beauty supplies.

Segment and  geographic  data for the years ended  September 30, 1997,  1996 and
1995 are as follows:
<TABLE>
<CAPTION>

<S>                                                           <C>               <C>              <C>
Business Segments Information (Thousands)                     1997              1996             1995

Net sales:
   Consumer products:                             
      Alberto-Culver USA                                $   444,204           377,468          305,681
      Alberto-Culver International                          466,530           452,030          363,294
                                                            -------           -------          -------
      Total consumer products                               910,734           829,498          668,975
   Specialty distribution - Sally                           879,209           771,868          697,668
   Eliminations                                             (14,685)          (10,957)          (8,424)
                                                            -------           -------           ------ 
                                                         $1,775,258         1,590,409        1,358,219
                                                         ==========         =========        =========
Earnings before provision for income taxes:
   Consumer products:
      Alberto-Culver USA                                  $  29,243            21,445           16,011
      Alberto-Culver International                           24,680            21,737           16,604
                                                             ------            ------           ------
      Total consumer products                                53,923            43,182           32,615
   Specialty distribution - Sally                            89,456            78,871           71,889
                                                             ------            ------           ------
     Operating profit                                       143,379           122,053          104,504
   Non-recurring gain (note 8)                               15,634                --               --
   Unallocated expenses, net*                               (14,654)           (9,971)         (13,730)
   Interest expense, net of interest income                  (8,238)          (12,068)          (6,532)
                                                             ------           -------           ------ 
                                                           $136,121           100,014           84,242
                                                           ========           =======           ======
Identifiable assets:
   Consumer products:
      Alberto-Culver USA                                $   205,804           197,478          130,592
      Alberto-Culver International                          329,887           333,738          284,750
                                                            -------           -------          -------
      Total consumer products                               535,691           531,216          415,342
   Specialty distribution - Sally                           373,111           308,869          257,437
   Corporate**                                               91,257            69,181          142,307
                                                             ------            ------          -------
                                                         $1,000,059           909,266          815,086
                                                         ==========           =======          =======
Depreciation and amortization expense:
   Consumer products:
      Alberto-Culver USA                                    $10,568             7,601            4,616
      Alberto-Culver International                           10,894            11,376            8,433
      Total consumer products                                21,462            18,977           13,049
   Specialty distribution - Sally                            16,009            11,780            9,953
   Corporate                                                  1,466             2,159            1,677
                                                              -----             -----            -----
                                                            $38,937            32,916           24,679
Capital expenditures:
   Consumer products:
      Alberto-Culver USA                                   $  7,434            11,419           11,975
      Alberto-Culver International                           16,694             8,885            6,293
                                                             ------             -----            -----
      Total consumer products                                24,128            20,304           18,268
   Specialty distribution - Sally                            18,608            20,872           13,746
   Corporate                                                 15,700                 --             381
                                                             ------                                ---
                                                            $58,436            41,176           32,395
                                                            =======            ======           ======

Geographic Area Information (Thousands)                        1997              1996            1995

Net sales:
   United States                                         $1,309,016         1,148,268          997,065
   Foreign                                                  484,978           453,709          364,543
   Eliminations                                             (18,736)          (11,568)          (3,389)
                                                            -------           -------           ------ 
                                                         $1,775,258         1,590,409        1,358,219
                                                         ==========         =========        =========
Operating profit:
   United States                                           $115,261            97,628           88,025
   Foreign                                                   28,118            24,425           16,479
                                                             ------            ------           ------
                                                           $143,379           122,053          104,504
                                                           ========           =======          =======
Identifiable assets:
   United States                                        $   565,578           507,545          390,763
   Foreign                                                  343,224           332,540          282,016
   Corporate**                                               91,257            69,181          142,307
                                                             ------            ------          -------
                                                         $1,000,059           909,266          815,086
                                                         ==========           =======          =======

* "Unallocated expenses, net" principally consists of general corporate expenses
and foreign exchange gains and losses.

**  Corporate   identifiable   assets  are  primarily  cash,  cash  equivalents,
short-term investments and equipment.
</TABLE>

                                                     - 289 -


<PAGE>





(10) Quarterly Financial Data

Unaudited quarterly consolidated statement of earnings information for the years
ended September 30, 1997 and 1996 are summarized below (in thousands, except per
share amounts):
                                1st       2nd        3rd       4th
                              Quarter    Quarter    Quarter   Quarter

1997 As Reported:
Net sales                    $426,105    439,577    456,210   453,366
Cost of products sold        $215,388    218,057    226,734   220,237
Net earnings                 $ 26,588     17,781     19,210    21,838
Earnings per share:
     Primary                     $.47        .31        .33       .38
     Fully-diluted               $.44        .29        .32      . 36


1997 Pro Forma:
Net earnings before
   non-recurring gain        $16,777*    17,781     19,210    21,838
Earnings per share before
   non-recurring gain:
     Primary                    $.30*       .31        .33      .38
     Fully-diluted              $.28*       .29        .32      .36

1996:
Net sales                    $347,638    396,146    415,554   431,071
Cost of products sold         178,343    200,459    208,526   217,752
Net earnings                   12,875     14,469     16,452    18,948
Earnings per share:
     Primary                     .23        .25        .29      .34
     Fully-diluted               .22        .24        .28      .32

 *   Excludes a non-recurring gain in the first quarter of $9.8 million or $.17
     per share on a primary basis and $.16 per share on a fully-diluted basis
     (note 8).

 (11) Acquisitions and Divestiture

In April, 1995, the company's Sweden-based  subsidiary,  Cederroth International
AB,  completed the  acquisition of the Toiletries  Division of Molnlycke AB. The
acquired  division  develops,  manufactures and markets body and skin care, hair
care, oral care and household products in Scandinavia.  The acquisition,  valued
at  approximately  $50 million,  was  accounted for as a purchase and was funded
with local bank  borrowings  payable in Swedish  krona.  The  operations  of the
Molnlycke  Toiletries business have been included in the company's  consolidated
financial statements since April, 1995.

In February, 1996, the company acquired St. Ives Laboratories, Inc. ("St. Ives")
for  approximately  $110 million.  St. Ives develops,  manufactures  and markets
personal care products  under its Swiss  Formula brand and  manufactures  custom
label products for other companies.

The  purchase of St. Ives was funded with the net  proceeds  available  from the
July, 1995 issuance of $100 million of 5.5% convertible  subordinated debentures
and from the sale of certain trade accounts receivable in January, 1996.

The acquisition was accounted for as a purchase and, accordingly,  the operating
results of St. Ives have been included in the company's  consolidated  financial
statements since the date of acquisition.  The excess of the aggregate  purchase
price over the fair market  value of net assets  acquired of  approximately  $51
million is being amortized over 40 years.

In July,  1996,  Alberto-Culver  USA sold its  Milani,  DiaFoods,  Thick-It  and
Smithers   institutional   food  lines  and  granted  the   purchaser  a  master
distribution  license to sell the company's other  institutional  food products.
The transaction resulted in an immaterial gain.

                                                     - 290 -


<PAGE>



Independent Auditors' Report

The Board of Directors and Stockholders
Alberto-Culver Company:
We have audited the accompanying  consolidated  balance sheets of Alberto-Culver
Company and  subsidiaries  as of  September  30, 1997 and 1996,  and the related
consolidated  statements of earnings,  retained earnings and cash flows for each
of  the  years  in  the  three-year  period  ended  September  30,  1997.  These
consolidated  financial  statements  are  the  responsibility  of the  company's
management.  Our  responsibility is to express an opinion on these  consolidated
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  financial  position of  Alberto-Culver
Company and  subsidiaries  as of September 30, 1997 and 1996, and the results of
their  operations  and their cash flows for each of the years in the  three-year
period  ended  September  30,  1997,  in  conformity  with  generally   accepted
accounting principles.

                                               /s/ KPMG Peat Marwick LLP
Chicago, Illinois
October 23, 1997                                   KPMG Peat Marwick LLP

                                                     - 291 -


<PAGE>




Management's Discussion and Analysis of Results of Operations and Financial 
Condition 
Alberto-Culver Company and Subsidiaries

RESULTS OF OPERATIONS

Fiscal  year 1997 marked the  company's  fourteenth  consecutive  year of record
sales.  Net sales for the year ended  September 30, 1997 were $1.78 billion,  an
increase of 11.6% over prior year sales of $1.59 billion. Net sales in 1995 were
$1.36 billion.

Record net earnings of $85.4 million in 1997,  including a  non-recurring  gain,
increased  36.1% from 1996 net earnings of $62.7 million.  Primary  earnings per
share of $1.49 were 38 cents or 34.2% higher than 1996.  Fully-diluted  earnings
per share were $1.41,  an increase of 35 cents or 33.0 % from 1996. Net earnings
in 1995 were $52.7 million, representing 95 cents primary earnings per share and
94 cents on a fully-diluted basis.

As described in"note 8" to the consolidated financial statements,  during fiscal
1997 the company received a $28.0 million insurance  settlement from the loss of
its corporate  airplane.  As a result,  the company  recognized a  non-recurring
pre-tax gain of $15.6  million and an increase in net earnings of $9.8  million.
Accordingly,  earnings  per share for fiscal year 1997  increased  17 cents on a
primary basis and 16 cents on a fully-diluted basis.

On a pro-forma basis, net earnings before the  non-recurring  gain were a record
$75.6 million or 20.5% higher than the prior year. Excluding the gain, pro-forma
earnings per share on a primary basis were $1.32, representing an increase of 21
cents or 18.9%,  and on a  fully-diluted  basis  increased  19 cents or 17.9% to
$1.25.

Prior to 1996, the Consumer  Products  Division of  Alberto-Culver  USA recorded
certain  promotional  allowances  that were shown as a  deduction  from the list
price reported on customer invoices as promotion expenses.  Effective October 1,
1995, the division  changed its method of reporting to a net sales basis thereby
reducing sales and promotion  expense by $12.6 million for 1996. This change had
no effect on net  income and prior  periods  have not been  reclassified  due to
immateriality.  The change is in  conformity  with  industry  practice  and also
provides  management with financial  information that is consistent across other
divisions of Alberto-Culver USA and Alberto-Culver International.

Sales of Alberto-Culver  USA consumer  products in 1997 were $444.2 million,  an
increase of 17.7 % from prior year sales of $377.5  million.  The 1997  increase
primarily  resulted  from higher sales of St. Ives products in addition to sales
increases for TRESemme, TCB, Mrs. Dash, Alberto VO5 Hot Oil and the introduction
of new  products.  In 1996,  sales  increased  23.5%  from 1995  sales of $305.7
million  primarily due to the acquisition of St. Ives, which added $87.7 million
of  sales,   partially   offset  by  lower  sales  due  to  the  change  in  the
classification of certain off-invoice promotional allowances.
 St. Ives Laboratories, Inc. was acquired in February, 1996.

Alberto-Culver International consumer products sales were $466.5 million in 1997
compared to $452.0  million in 1996 and $363.3  million in 1995. The fiscal year
1997 sales increase of 3.2% was mainly due to higher sales of St. Ives products,
offset in part by the effects of unfavorable  foreign  exchange rates due to the
strengthening of the U.S. dollar.  Had foreign exchange rates this year been the
same as fiscal 1996,  Alberto-Culver  International  sales would have  increased
8.3% for the year.  The  sales  increase  in 1996  primarily  resulted  from the
acquisition of St. Ives.

Sales of the "Specialty  distribution  - Sally"  business  segment  increased to
$879.2 million in 1997 compared to $771.9 million and $697.7 million in 1996 and
1995, respectively.  The sales increases of 13.9% in 1997 and 10.6% in 1996 were
attributable to sales gains for established  Sally Beauty Company  outlets,  the
addition  of stores  during the year and the  expansion  of  Sally's full
service  operations.  The number of Sally stores increased 34.5% during the last
three  years to a total of 1,833 at the end of 1997  compared to 1,656 and 1,494
at the end of 1996 and 1995, respectively.

Cost of  products  sold as a  percentage  of sales was 49.6% in fiscal year 1997
compared  to 50.6% in 1996 and 50.3% in 1995.  The lower cost of  products  sold
percentage in 1997 was primarily due to cost savings and a change in product mix
favoring higher margin products of Alberto-Culver USA.


Advertising,  promotion, selling and administrative expenses increased 13.8 % in
1997 and 15.1% in 1996.  The increase in 1997 resulted from the  acquisition  of
St. Ives, higher selling and administration  costs associated with the growth of
the Sally Beauty business and higher advertising,  promotion and market research
expenses for  Alberto-Culver  USA. The 1996 increase resulted primarily from the
acquisition of St. Ives, the inclusion of the operations of Molnlycke Toiletries
for a full year and higher selling and administration  costs associated with the
growth of the Sally Beauty  business.  These  increases  in 1996 were  partially
offset  by  an   immaterial,   non-recurring   gain  on  the  sale  of   certain
Alberto-Culver USA institutional food lines in July, 1996.

Advertising,  promotion and market  research  expenditures  were $255.3 million,
$208.4  million and $188.0  million in 1997,  1996 and 1995,  respectively.  The
increase in 1997 mainly  resulted from the acquisition of St. Ives and increased
marketing expenditures for Alberto-Culver USA, including the introduction of new
products. The increase in 1996 was primarily due to the acquisitions of St. Ives
and Molnlycke  Toiletries,  partially offset by the  reclassification of certain
off-invoice promotional allowances.

Interest expense,  net of interest income,  was $8.2 million,  $12.1 million and
$6.5 million in 1997, 1996 and 1995,  respectively.  Interest  expense was $11.8
million  in 1997  versus  $15.9  million in 1996 and $9.9  million in 1995.  

                                                     - 292 -


<PAGE>


The decrease in interest  expense in 1997 was  attributable to the prepayment of
$20 million of 9.73% term notes in August,  1996 and a reduction in  outstanding
revolving  Swedish krona debt,  including the impact of foreign  exchange rates.
The 1996 increase was primarily due to the convertible  subordinated  debentures
and borrowings related to the Molnlycke acquisition being outstanding for a full
year,  along with the penalty  incurred on the August,  1996  prepayment  of $20
million of term notes.

The provision  for income taxes as a percentage of earnings  before income taxes
was 37.3%, 37.3% and 37.5% in 1997, 1996 and 1995,  respectively.  Factors which
influenced  the effective tax rates for those years are described in "note 6" to
the consolidated financial statements.

FINANCIAL CONDITION

Working capital at September 30, 1997 was $269.0  million,  an increase of $42.9
million from the prior year's working capital of $226.1  million.  The resulting
current  ratio was 1.86 to 1.00 at September  30, 1997  compared to 1.79 to 1.00
last year.  The higher  working  capital  was  primarily  due to an  increase in
inventories partially offset by higher accounts payable.

Accounts receivable and inventories less accounts payable were $290.3 million at
September  30, 1997  compared to $259.6  million  last year.  The  increase  was
primarily  due to higher  inventories  needed to support the growth of the Sally
Beauty business and increased St. Ives activity.

Net property,  plant and equipment  increased $15.1 million to $191.0 million at
September  30, 1997.  The increase  resulted  primarily  from  additional  Sally
stores, warehouse and office expenditures and purchases of machinery,  equipment
and information  systems.  The involuntary  conversion of the corporate airplane
was offset by the purchase of an interest in another airplane.

Goodwill  and  trade  names,  net of  amortization,  was  $184.4  million  as of
September 30, 1997,  down slightly from 1996. The decrease in goodwill and trade
names was due to amortization and the effects of foreign exchange rates,  offset
by  additional  goodwill  from Sally Beauty  acquisitions  and  finalization  of
purchase accounting related to the St. Ives acquisition.

Long-term debt  decreased  $12.1 million  principally  due to a reduction in the
local currency  amount of Swedish krona revolving debt and the impact of foreign
exchange rates.

Total  stockholders'  equity  increased  $71.9  million  to  $497.0  million  at
September 30, 1997  primarily due to net earnings for the fiscal year  partially
offset by dividend payments and foreign currency translation.



LIQUIDITY AND CAPITAL RESOURCES

The company's  primary sources of cash over the past three years have been funds
provided by operating  activities,  the July,  1995  issuance of $100 million of
convertible  subordinated  debentures  and the 1996 sale of $30 million of trade
accounts receivable.  Operating activities provided cash of $79.7 million, $92.7
million and $81.8 million in 1997, 1996 and 1995, respectively.

The company has obtained long-term  financing as needed to fund acquisitions and
other  growth  opportunities.  Funds are  occasionally  obtained  prior to their
actual need in order to take advantage of opportunities in the debt markets.  In
September, 1997, the company obtained a five-year, $200 million revolving credit
facility. The facility, which is undrawn at September 30, 1997, can be increased
to $300 million under certain  conditions and may be drawn in U.S. dollars or in
certain foreign currencies. Under debt covenants, the company has the ability to
incur up to $590 million of additional debt.

The  primary  uses  of  cash  have  been  to  repay   long-term  debt  and  fund
acquisitions.  During the three year period  ending  September  30,  1997,  debt
repayments  exceeded  proceeds from new  borrowings,  excluding the  convertible
subordinated  debentures,  by $23.0 million. Other major uses of cash during the
three year period  included  payments for acquired  companies of $188.2 million,
capital expenditures of $130.1 million and cash dividends of $29.2 million.

Compared to 1994,  cash dividends per share  increased 41.8% over the three-year
period ended  September  30, 1997.  Cash  dividends  paid on Class A and Class B
common stock were $.195 per share in 1997, $.175 per share in 1996 and $.155 per
share in 1995.

The company  anticipates  that cash flows from  operations and available  credit
will be  sufficient to fund  operational  requirements  in future years.  During
1998, the company  expects that cash will continue to be used for  acquisitions,
capital expenditures, new product development,  market expansion,  retirement of
debt and dividend  payments.  The company may also purchase shares of its common
stock depending on market conditions.

                                                     - 293 -


<PAGE>



IMPACT OF NEW ACCOUNTING STANDARDS

In February,  1997, the FASB issued Statement of Financial  Accounting Standards
("SFAS")  No. 128,  "Earnings  Per Share."  SFAS No. 128  supersedes  Accounting
Principles  Board Opinion No. 15,  "Earnings Per Share" ("APB 15"), and requires
the  calculation and dual  presentation of basic and diluted  earnings per share
("EPS"),  replacing the primary and fully-diluted disclosures required under APB
15. The  company is required to comply with SFAS No. 128 in fiscal year 1998 and
estimates that its adoption will not have a material effect on the  consolidated
financial statements.

In June, 1997, the FASB issued SFAS No. 130, "Reporting  Comprehensive  Income,"
which requires the prominent display of comprehensive  income and its components
in the financial statements. The company is required to comply with SFAS No. 130
in fiscal year 1999 and estimates  its adoption will not have a material  effect
on the consolidated financial statements.

In June, 1997, the FASB issued SFAS No. 131,  "Disclosures  About Segments of an
Enterprise  and Related  Information."  SFAS No. 131  establishes  standards for
reporting  information about operating segments in annual financial  statements.
The  company is  required  to comply  with SFAS No. 131 in fiscal  year 1999 and
estimates  its  adoption  will not have a  material  effect on the  consolidated
financial statements.

INFLATION

The company was not  significantly  affected by inflation  during the past three
years.  Management continuously attempts to resist cost increases and counteract
the effects of  inflation  through  productivity  improvements,  cost  reduction
programs and price increases  within the  constraints of the highly  competitive
markets in which the company operates.

                                                     - 294 -


<PAGE>


<TABLE>
<CAPTION>

<S>
Selected Financial Data                           <C>              <C>             <C>          <C>          <C>      
Alberto-Culver Company and Subsidiaries


                                                                       Year ended September 30,
(In thousands, except per share data)                  1997            1996            1995         1994         1993

Operating Results:
Net sales                                         $1,775,258       1,590,409       1,358,219    1,216,119    1,147,990
Cost of products sold                                880,416         805,080         682,589      602,749      564,260
Interest expense                                      11,826          15,905           9,946        8,630        9,661
Earnings before non-recurring gain
 and income taxes (1)                                120,487         100,014          84,242       71,078       65,129
Provision for income taxes (1)                        44,881          37,270          31,591       27,010       23,857
Net earnings before non-recurring gain (1)            75,606          62,744          52,651       44,068       41,272
Net earnings per share before
 non-recurring gain (1) (2):
     Primary                                            1.32            1.11             .95          .79          .72
     Fully-diluted                                      1.25            1.06             .94          .79          .72
Weighted average shares outstanding (2):
     Primary                                          57,202          56,426          55,698       56,084       57,434
     Fully-diluted                                    63,637          62,776          57,152       56,162       57,434
Financial Condition:
Current ratio                                      1.86 to 1       1.79 to 1       2.28 to 1    1.86 to 1    2.05 to 1
Working capital                                   $  269,007         226,123         301,706      185,747      205,050
Cash, cash equivalents and
  short-term investments                              87,600          71,557         146,985       50,362       73,947
Property, plant and equipment, net                   190,998         175,920         157,791      132,881      124,449
Total assets                                       1,000,059         909,266         815,086      610,208      593,046
Long-term debt                                        49,441          61,548          83,094       42,976       80,184
Convertible subordinated debentures                  100,000         100,000         100,000         ---          ---
Stockholders' equity                                 497,004         425,096         370,903      326,970      298,857
Cash dividends per share (3)                            .195            .175            .155        .1375        .1375
</TABLE>

(1)       1997 excludes a  non-recurring  gain from an insurance  settlement for
          the  loss  of the  company's  corporate  airplane  (note  8).  Pre-tax
          earnings  including the  non-recurring  gain were $136.1 million.  Net
          earnings including the gain were $85.4 million, after deducting income
          taxes of $50.7 million, and earnings per share were $1.49 on a primary
          basis and $1.41 on a fully-diluted basis.

(2)       Net earnings per share and weighted average shares outstanding have 
          been restated to reflect the 100% stock dividend on the company's
          Class A and Class B outstanding shares in February, 1997.

(3)       Dividends  per share on Class A common  stock and Class B common stock
          have been equal since the Class A shares  were issued in April,  1986.
          Dividends  paid  in  fiscal  1993  include  a  one-time  extraordinary
          dividend  of two  cents  per  share  in  recognition  of  the  company
          surpassing  one  billion  dollars in sales for the  fiscal  year ended
          September 30, 1992.



Annual 10-K Report
Stockholders may obtain a copy of the company's 1997 Form 10-K Report filed with
the  Securities  and  Exchange  Commission  without  charge  by  writing  to the
Corporate Secretary, Alberto-Culver Company, 2525 Armitage Avenue, Melrose Park,
Illinois 60160.

                                                     - 295 -


<PAGE>



Market Price of Common Stock and Cash Dividends Per Share
Alberto-Culver Company and Subsidiaries


The high and low sales prices of both classes of the  company's  common stock on
the New York Stock  Exchange  and cash  dividends  per share in each  quarter of
fiscal years 1997 and 1996 are as follows:
<TABLE>

                                                                                   Cash
                                             Market Price Range                   Dividends
                                       1997                       1996            Per Share             
<S>                            <C>         <C>          <C>        <C>           <C>     <C> 
                               High        Low          High       Low           1997    1996
Class A (NYSE Symbol ACVA):
   First Quarter               $21-3/8     18-3/8       16-3/16    12-7/8        $.045    .040
   Second Quarter              $24         20           19-7/16    14-13/16       .050    .045
   Third Quarter               $25-5/8     21           20-1/16    16-7/16        .050    .045
   Fourth Quarter              $26-11/16   21-13/16     20-1/8     16-15/16       .050    .045
                                                                                 $.195    .175


Class B (NYSE Symbol ACV):
   First Quarter               $25         21-3/8       18-1/4     14-15/16      $.045    .040
   Second Quarter              $28-5/8     23-9/16      21-7/8     16-1/4         .050    .045
   Third Quarter               $30         25           23-3/8     18-3/8         .050    .045
   Fourth Quarter              $31-9/16    26-1/16      23-3/4     20             .050    .045
                                                                                 $.195    .175
</TABLE>


As of November 25, 1997, stockholders of record totaled 1,097 for Class A shares
and 1,160 for Class B shares.
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