TO  OUR  STOCKHOLDERS



     Sales  for  the  52-week  fiscal year ended June 1, 2002, were $28,900,428.
The  Company  opened  its  seventh  store  on  April 28, 2001.   Six stores were
operated  for  eleven  months during the fiscal year ended June 2, 2001.     The
Company  operated  at  a  net  loss  for  the  2002 fiscal  year of  $226,831 as
compared  to  a  net  profit  of  $7,694 for the previous year.   Net  loss  per
share  was  27  cents  for the current  fiscal  year as compared to net earnings
of  1 cent per share for the previous fiscal year.  Book value per share at June
1,  2002,  and  June  2,  2001,  was  $2.72  and  $2.99,  respectively.

     The  Board  of Directors elected not to pay dividends during the year.  The
Company  repurchased 4,186 shares of common stock from unaffiliated shareholders
in  response  to  several  unsolicited  requests  during  the  year.

     It  has  been difficult for the Company to operate at a profit for the past
four  fiscal  years due to increased pressure from competition.  The addition of
our  seventh  store  in  April of 2001 and the change in our principal inventory
supplier  in  March  of  2000  has  allowed the Company to better compete in the
marketplace.  However,  the  Company sustained an operating loss of $226,831 for
the  year  ended June 1, 2002 due in part to the periodic use of more aggressive
pricing  strategies  in an effort to compete with larger discount grocery chains
and expand sales at all locations.  We anticipate that competition in the retail
grocery  business  will  continue  to  increase  for  the  foreseeable  future.

     Management  continues  to  believe  there  is a place for small independent
retailers  in  the  grocery  business.   While the current trend seems to negate
that belief, management believes that the Company can remain a viable competitor
in  the  markets that it serves despite its small size relative to others in the
industry.  We anticipate that price competition from larger discount chains will
continue to pose a major challenge for ACI, but we also believe that it is still
possible  for  community-based  stores such as ours to compete on the basis of a
variety  of  different  factors.

     It  is  difficult to anticipate the effect of current and future events and
actions  in  the  marketplace,  but  the  management of ACI intends to have your
Company  continue  to  be a source of employment and to serve the communities in
our  trade  area.

                                            Sincerely,

                                            AMERICAN  CONSUMERS,  INC.



                                            Michael  A.  Richardson
                                            Chairman and Chief Executive Officer


<PAGE>
<TABLE>
<CAPTION>
BOARD OF DIRECTORS               CORPORATE OFFICERS            CORPORATE INFORMATION
<S>                              <C>                           <C>
VIRGIL BISHOP (1)                MICHAEL A. RICHARDSON         EXECUTIVE OFFICES
Vice President                   Chairman of the Board,        P.O. Box 2328
American Consumers, Inc.           Chief Executive Officer     Fort Oglethorpe, GA  30742
                                   and President

PAUL R. COOK (1)                 PAUL R. COOK                  AUDITORS
Executive Vice-President         Executive Vice-President      Hazlett, Lewis & Bieter, PLLC
  and Treasurer                    and Treasurer               Market Court, Suite 300
American Consumers, Inc.                                       537 Market Street
                                                               Chattanooga, TN  37402

MICHAEL A. RICHARDSON (1)        JAMES E. FLOYD (1)            COUNSEL
Chairman of the Board,           Vice-President                Shumacker Witt Gaither &
  Chief Executive Officer                                        Whitaker, P.C.
  and President                                                1100 SunTrust Bank Building
American Consumers, Inc.                                       Chattanooga, TN  37402

THOMAS L. RICHARDSON (2)(3)      VIRGIL BISHOP                 10-K REPORT
Chairman of the Board            Vice-President                American Consumers, Inc.'s
Learning Labs, Inc.                                              annual report on Form 10-K
                                                                 as filed with The Securities
JEROME P. SIMS, SR. (2)(3)       REBA S. SOUTHERN (1)            and Exchange Commission is
Physician                        Secretary                       available to stockholders free
                                                                 of charge upon written request
ANDREW V. DOUGLAS (2)(3)                                         to Corporate Secretary
Retail Counselor (Retired)                                       American Consumers, Inc.,
Fleming Companies, Inc.                                          P.O. Box 2328,
                                                                 Ft. Oglethorpe, GA  30742
DANNY R. SKATES (2)(3)
Vice President of Jackson
Chevrolet, Oldsmobile, Pontiac
Buick, GMC, Inc.

<FN>
(1)  Executive  Committee (Mr. Floyd and Mrs. Southern are ex officio members of the  committee.)

(2)  Audit  Committee

(3)  Compensation  Committee
</TABLE>


                                      -2-
<PAGE>
<TABLE>
<CAPTION>
                              AMERICAN  CONSUMERS,  INC.

                         FIVE-YEAR  SUMMARY  OF  OPERATIONS

                      (In thousands, except per share amounts)


------------------------------------------------------------------------------------

                                                    FISCAL  YEAR  ENDED
                                    ------------------------------------------------
                                     JUNE 1    JUNE 2    JUNE 3    MAY 29    MAY 30
                                      2002      2001      2000      1999      1998
                                    --------  --------  --------  --------  --------
<S>                                 <C>       <C>       <C>       <C>       <C>
NET SALES                           $28,900   $25,635   $25,619   $25,482   $26,920
                                    --------  --------  --------  --------  --------


COST AND EXPENSES:
  Cost of goods sold                 22,313    19,561    19,682    19,831    21,015
  Operating, general and
    administrative expenses           6,881     6,137     6,020     5,759     5,788
  Interest expense                       73        26        56        52        58
  Other income, net                     (96)      (94)      (66)      (71)      (64)
                                    --------  --------  --------  --------  --------

    Total                            29,171    25,630    25,692    25,571    26,797
                                    --------  --------  --------  --------  --------

Income (loss) before income taxes      (271)        5       (73)      (89)      123
                                    --------  --------  --------  --------  --------

INCOME TAXES:
  Federal                               (42)       (3)      (18)      (26)       29
  State                                  (2)        -        (4)       (6)        8
                                    --------  --------  --------  --------  --------

    Total                               (44)       (3)      (22)      (32)       37
                                    --------  --------  --------  --------  --------

NET INCOME (LOSS)                   $  (227)  $     8   $   (51)  $   (57)  $    86
                                    ========  ========  ========  ========  ========
PER SHARE AMOUNTS:
  Net income (loss)                 $  (.27)  $   .01   $  (.06)  $  (.06)  $   .09
                                    ========  ========  ========  ========  ========
  Cash dividends                    $     -   $     -   $     -   $     -   $     -
                                    ========  ========  ========  ========  ========
WEIGHTED AVERAGE NUMBER
  OF SHARES OUTSTANDING                 825       832       838       883       907
                                    ========  ========  ========  ========  ========
TOTAL ASSETS                        $ 4,469   $ 4,566   $ 3,674   $ 4,033   $ 4,257
                                    ========  ========  ========  ========  ========
OBLIGATIONS UNDER CAPITAL
  LEASE AGREEMENTS                  $     -   $     3   $    67   $   185   $   328
                                    ========  ========  ========  ========  ========
</TABLE>


                                      -3-
<PAGE>
                         MARKET AND DIVIDEND INFORMATION


     The  Company's  common stock is traded in the over-the-counter market.  The
approximate  number  of  record holders of the Company's common stock at June 1,
2002,  was  858.   The  following  table  gives  the  range  of high and low bid
quotations  and  dividends  for  each  quarterly  period for the two most recent
fiscal  years.

                    Bid  Prices   Asked Prices  Dividends
--------------------------------  ------------  ---------
                   High    Low    High    Low   Per Share
                  ------  ------  -----  -----  ---------
2002
  First Quarter   $0.375  $0.375  $4.00  $4.00  None
---------------------------------------------------------
  Second Quarter  $0.375  $0.375  $4.00  $4.00  None
---------------------------------------------------------
  Third Quarter   $ 0.45  $ 0.45  $4.00  $4.00  None
---------------------------------------------------------
  Fourth Quarter  $ 0.65  $ 0.65  $4.00  $4.00  None
---------------------------------------------------------


2001
  First Quarter   $ 0.30  $ 0.30  $4.00  $4.00  None
---------------------------------------------------------
  Second Quarter  $ 0.30  $ 0.30  $4.00  $4.00  None
---------------------------------------------------------
  Third Quarter   $ 0.30  $ 0.30  $2.00  $2.00  None
---------------------------------------------------------
  Fourth Quarter  $ 0.30  $ 0.30  $2.00  $2.00  None
---------------------------------------------------------

     The  information  set  forth  in  the  above table is supplied through Pink
Sheets  LLC  where  available.

     There is no established public trading market for the Company's stock,  and
the  information  set  forth  above  is  based  on  a  small  number of isolated
quotations  which do not necessarily represent actual trades.  The market-makers
as  of  June  1,  2002,  are:

     Carr  Securities  Corporation       (516)  944-8300

     Hill  Thompson  Magid  &  Co.       (800)  631-3083

     Monroe  Securities,  Inc.           (800)  766-5560

     Howe  Barnes  Investment,  Inc.     (800)  621-2364


                                      -4-
<PAGE>
                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                       CONDITION AND RESULTS OF OPERATIONS

                              RESULTS OF OPERATIONS
                              ---------------------

     The  Company  realized  an after-tax loss in its fiscal year ended  June 1,
2002,  of $226,831 as compared  to a profit of $7,694 for the prior fiscal year.
Net  sales  for  the current fiscal year increased almost 13% from net sales for
the  previous  fiscal  year.   Same  store  sales  for  the  current fiscal year
increased  less  that  3%  from  same  store sales for the previous fiscal year.
Management  believes  that  the  smaller  than expected increase in sales is due
primarily  to  direct  competition.

     Increased pressure from competition  on  the  Company's market share, sales
and  profits  during fiscal year 2002 continues to threaten the profitability of
the  Company.  Management  believes  that  competitive pressures on  the Company
will  continue to increase over time as a result of its competitors opening more
new  stores  in  the  Company's  trade  area.  Management  continuously seeks to
improve the gross margin and increase profitability by obtaining the lowest cost
for  the  Company's  inventory.

     The Company's gross margin  decreased  from  23.69%  to  22.79%  during the
past year.  The gross margin was 23.17% for the year ended June 3, 2000.     The
Company began an effort in the third  quarter  of  fiscal  year 1998 to increase
gross  margin  by  increasing  retail  prices  on  certain items,  to the extent
permitted  by competition.  The success of this effort and a switch of our major
inventory  supplier  in the last quarter of fiscal 2000 resulted in the increase
in gross margin from 2000 to 2001.    However, gross margin decreased for fiscal
year  2002 due in part to the periodic use of more aggressive pricing strategies
in  an effort to compete with larger discount grocery chains and expand sales at
all  locations.

     The Company's Operating, General and Administrative Expenses for the fiscal
year  ended  June 1, 2002, increased by approximately $743,699 from the previous
fiscal  year.  Expenses as a percentage of sales decreased from 23.94% to 23.81%
over  the  past  fiscal  year.  Operating,  General  and Administrative Expenses
amounted  to 23.50% of net sales for fiscal year 2000.  Management will continue
to  monitor  these  costs  and  make adjustments when deemed to be beneficial to
business.

     Interest expense varied throughout the fiscal years presented, from $55,206
in  2000  to  $26,071  in 2001  to  $72,944  in  2002.   The increase in 2002 is
attributable  to  financing  the purchase of new replacements for cash registers
and  scanning equipment which previously had been leased, and to the purchase of
the  Company's  seventh  retail  store in late April 2001.  The decrease between
2000  and  2001 is attributable to the decrease in interest on capitalized lease
obligations.


                                      -5-
<PAGE>
     Other  income  for  the  past three fiscal years consists of the following:

<TABLE>
<CAPTION>
                                   2002     2001     2000
                                 --------  -------  -------
<S>                              <C>       <C>      <C>

  Vendors' compensation          $13,095   $12,988  $10,019
  Gain (loss) on sale of assets   (8,472)    7,971    2,009
  Interest income                 20,347    26,732   21,219
  Other income                    70,566    46,618   32,639
                                 --------  -------  -------
      Totals                     $95,536   $94,309  $65,886
                                 ========  =======  =======
</TABLE>

     Other  income  increased  due  to  both  an increase in the collection of a
check-cashing  charge for individuals wishing to cash their check but not making
a  purchase and an increase in the price the Company charges customers for money
orders  during  fiscal  2002.

     The Company seeks to improve its profitability by obtaining the lowest cost
for  its  goods.  In  an  effort  to lower its cost of goods, the Company ceased
using  Fleming Co., Inc. as its major supplier of staple groceries in March 2000
and  began  purchasing  its  inventory  from  Mitchell  Grocery  Corporation  in
Albertville,  Alabama  in  March  2000.

Income  Taxes
-------------

     The  provision  for  income  taxes  does  not vary  significantly  from the
Federal  and  state  statutory rates.  The components of income tax are detailed
in  Note  6  of  the  Company's  financial  statements.

Inflation
---------

     The  Company  continues  to seek ways to cope with the threat of inflation.
To the extent permitted by competition, increased costs of goods and services to
the  Company  are reflected in increased selling prices for the Company's goods.
When  the  Company  is  forced to raise overall prices of its goods, the Company
attempts  to  preserve  its  market share by competitive pricing strategies that
emphasize  weekly-advertised  specials.

                               FINANCIAL CONDITION
                               -------------------

Liquidity  and  Capital  Resources
----------------------------------

     The  Company finances its working  capital requirements principally through
its  cash  flow from operations and short-term borrowings.  Short-term borrowing
to  finance  inventory  purchases  is provided by the Company's $600,000 line of
credit  from  its  bank.  Based  upon  the  Company's  current  working  capital
requirements,  management  believes  that the Company's available credit will be
adequate  to finance its liquidity needs for fiscal 2003.  Short-term borrowings
at  the  end  of  the  2002  and  2001  fiscal  years  are  as  follows:

                                              2002      2001
                                            --------  --------

  Line of credit at Northwest Georgia Bank  $345,000  $456,500
  Note payable to Northwest Georgia Bank           -   254,952
  Note to Michael and Diana Richardson        23,626    37,412
  Note to Matthew Richardson                  41,697    48,330
                                            --------  --------
                    Totals                  $410,323   797,194
                                            ========  ========


                                      -6-
<PAGE>
     During the third quarter of fiscal 2001, the Company commenced a program of
purchasing  new  replacements  for  cash registers and other equipment which the
Company  previously  leased.  The  Company negotiated financing for this program
with  Northwest  Georgia  Bank  in  the  form of a short-term note, which had an
outstanding  balance  of  $254,952  at  June  2,  2001.  Upon completion of this
purchasing  cycle,  the  balance  on  the  short-term loan was refinanced over a
five-year  term.  For  additional  details  concerning  the Company's short-term
borrowings,  see  Note  3  to  the  Company's  financial  statements.

     At  June  1,  2002,  long-term debt consists of a note payable to a bank of
$137,850  that  was  incurred  in  April  2001  to  finance  the addition of the
Company's  seventh grocery store in Jasper, Tennessee, and a note payable to the
bank  of  $502,822  to  finance  cash  registers  and  peripheral equipment.  In
addition,  two  vehicles were purchased and financed through GMAC with a balance
due  at  June  1,  2002,  of  $40,482.

     The ratio of current assets to current liabilities was 2.05 to 1 at the end
of  fiscal 2002, as compared to 1.98 to 1 at the end of fiscal 2001, and 2.80 to
1 at the end of fiscal 2000.  Cash constituted  35.22% of  total current  assets
at  June  1,  2002,  as  compared to  44.91% of total current assets at  June 2,
2001,  and  40.99%  at  June  3,  2000.

     During the fiscal year ended June 1, 2002, retained earnings decreased as a
result  of  the  operating  loss  for  the  fiscal  year.

Material  Commitments
---------------------

     Capital  expenditures  are  not  expected  to  exceed $200,000 for the 2003
fiscal  year.

     The  Company has adopted a 401(k) plan that is administered by Capital Bank
and  Trust  Company.  Participation  in  the  plan is available to all full-time
employees.  Any  contribution  by  the  Company will be at the discretion of the
Board  of  Directors.  The Company's contribution to the plan was $7,500 in 2002
and  2001.

     None  of  the  Company's  employees  are  represented  by  a  union.

Forward-Looking  Statements
---------------------------

     Information  provided  by the Company, including written or oral statements
made  by  its  representatives,  may  contain  "forward-looking information"  as
defined  in Section 21E of the Securities Exchange Act of 1934, as amended.  All
statements  which  address  activities,  events or developments that the Company
expects or anticipates will or may occur in the future, including such things as
expansion  and  growth  of  the  Company's  business,  the  effects  of  future
competition,  future  capital  expenditures and the Company's business strategy,
are forward-looking statements.  In reviewing such information it should be kept
in  mind  that  actual  results  may  differ  materially from those projected or
suggested  in such forward-looking statements.  This forward-looking information
is  based  on  various  factors  and was derived utilizing numerous assumptions.
Many  of  these factors previously have been identified in filings or statements
made  by  or on behalf of the Company, including filings with the Securities and
Exchange  Commission  of  Forms  10-Q,  10-K and 8-K.  Important assumptions and
other  important  factors  that  could cause actual results to differ materially
from  those  set  forth  in  the  forward-looking  statements  include:  changes
in  the


                                      -7-
<PAGE>
general  economy  or  in  the  Company's primary markets, the effects of ongoing
price  competition  from competitors with greater financial resources than those
of the Company, changes in consumer spending, the nature and extent of continued
consolidation  in  the grocery store industry, changes in the rate of inflation,
changes  in  state  or federal legislation or regulation, adverse determinations
with  respect to any litigation or other claims, inability to develop new stores
or  complete  remodels as rapidly as planned, stability of product costs, supply
or  quality  control  problems  with  the  Company's  vendors,  and other issues
detailed  from  time-to-time  in  the  Company's filings with the Securities and
Exchange  Commission.


                                      -8-
<PAGE>
               Report of Independent Certified Public Accountants
               --------------------------------------------------



To  the  Board  of  Directors  and  Stockholders
American  Consumers,  Inc.
Fort  Oglethorpe,  Georgia

     We have audited the accompanying balance sheets of American Consumers, Inc.
as  of  June  1,  2002,  and June 2, 2001, and the related statements of income,
changes  in  stockholders' equity, and cash flows for each of the three years in
the  period  ended  June  1,  2002.  These  financial  statements  are  the
responsibility of the Company's management.  Our responsibility is to express an
opinion  on  these  financial  statements  based  on  our  audits.

     We  conducted  our  audits  in accordance with auditing standards generally
accepted  in the United States of America.  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 financial statements mentioned above present fairly, in
all  material respects, the financial position of American Consumers, Inc. as of
June  1,  2002, and June 2, 2001, and the results of its operations and its cash
flows  for  each  of  the  three  years  in  the  period  ended June 1, 2002, in
conformity with accounting principles generally accepted in the United States of
America.






Chattanooga,  Tennessee
July  11,  2002


                                      -9-
<PAGE>
<TABLE>
<CAPTION>
                            AMERICAN CONSUMERS, INC.

                              STATEMENTS OF INCOME

    For the Fiscal Years Ended June 1, 2002, June 2, 2001, and June 3, 2000

--------------------------------------------------------------------------------

                                            2002          2001          2000
                                         (52 Weeks)    (53 Weeks)    (52 Weeks)
                                        ------------  ------------  ------------
<S>                                     <C>           <C>           <C>
NET SALES                               $28,900,428   $25,634,552   $25,618,564

COST OF GOODS SOLD                       22,312,787    19,560,530    19,682,468
                                        ------------  ------------  ------------

    Gross profit                          6,587,641     6,074,022     5,936,096

OPERATING, GENERAL AND
  ADMINISTRATIVE EXPENSES                 6,880,939     6,137,240     6,019,545
                                        ------------  ------------  ------------

    Operating income (loss)                (293,298)      (63,218)      (83,449)
                                        ------------  ------------  ------------

OTHER INCOME (EXPENSE)
  Interest expense                          (72,944)      (26,071)      (55,206)
  Other income                               95,536        94,309        65,886
                                        ------------  ------------  ------------

                                             22,592        68,238        10,680

    Income (loss) before income taxes      (270,706)        5,020       (72,769)

FEDERAL AND STATE INCOME
  TAXES                                     (43,875)       (2,674)      (22,232)
                                        ------------  ------------  ------------

NET INCOME (LOSS)                       $  (226,831)  $     7,694   $   (50,537)
                                        ============  ============  ============

EARNINGS (LOSS) PER SHARE               $      (.27)  $       .01   $      (.06)
                                        ============  ============  ============

WEIGHTED AVERAGE NUMBER
  OF SHARES OUTSTANDING                     825,467       831,955       838,443
                                        ============  ============  ============
<FN>
  The Notes to Financial Statements are an integral part of these statements.
</TABLE>


                                      -10-
<PAGE>
<TABLE>
<CAPTION>
                 AMERICAN CONSUMERS, INC.
                      BALANCE SHEETS
              June 1, 2002 and June 2, 2001

---------------------------------------------------------------

                                         2002          2001
                                     ------------  ------------
<S>                                  <C>           <C>
      ASSETS

CURRENT ASSETS
  Cash and short-term investments    $   743,370   $ 1,245,135
  Certificate of deposit                 450,000       450,000
  Accounts receivable                    108,756       104,917
  Inventories                          2,001,339     1,894,146
  Prepaid expenses                        40,657        80,003
  Refundable income taxes                 43,891             -
                                     ------------  ------------

      Total current assets             3,388,013     3,774,201
                                     ------------  ------------



PROPERTY AND EQUIPMENT - at cost
  Leasehold improvements                 258,122       218,332
  Furniture, fixtures and equipment    2,959,273     2,843,230
                                     ------------  ------------

                                       3,217,395     3,061,562
  Less accumulated depreciation       (2,136,594)   (2,270,177)
                                     ------------  ------------

                                       1,080,801       791,385
                                     ------------  ------------

                                     $ 4,468,814   $ 4,565,586
                                     ============  ============
<FN>
The Notes to Financial Statements are an integral part of these statements.
</TABLE>


                                      -11-
<PAGE>
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------

                                                             2002        2001
                                                          ----------  ----------
<S>                                                       <C>         <C>
      LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
  Accounts payable                                        $  801,407  $  788,639
  Short-term borrowings                                      410,323     797,194
  Current maturities of long-term debt                       131,451      28,688
  Current obligations under capital leases                         -       3,195
  Accrued sales tax                                          138,948     132,536
  Federal and state income taxes                               4,000       9,422
  Other                                                      169,743     146,026
                                                          ----------  ----------

      Total current liabilities                            1,655,872   1,905,700
                                                          ----------  ----------

DEFERRED INCOME TAXES                                              -       3,827
                                                          ----------  ----------

LONG-TERM DEBT                                               549,703     140,733
                                                          ----------  ----------

DEFERRED INCOME                                               22,580      43,651
                                                          ----------  ----------

STOCKHOLDERS' EQUITY
  Nonvoting preferred stock - authorized 5,000,000
    shares of no par value; no shares issued                       -           -
  Nonvoting common stock - $.10 par value; authorized
    5,000,000 shares; no shares issued                             -           -
  Common stock - $.10 par value; authorized 5,000,000
    shares; shares issued of 823,047 in 2002 and 827,233
        in 2001                                               82,305      82,723
  Additional paid-in capital                                 686,357     689,847
  Retained earnings                                        1,471,997   1,699,105
                                                          ----------  ----------

                                                           2,240,659   2,471,675
                                                          ----------  ----------

                                                          $4,468,814  $4,565,586
                                                          ==========  ==========
</TABLE>


                                      -12-
<PAGE>
<TABLE>
<CAPTION>
                            AMERICAN CONSUMERS, INC.

                  STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

    For the Fiscal Years Ended June 1, 2002, June 2, 2001, and June 3, 2000

---------------------------------------------------------------------------

                                        Additional
                               Common    Paid-in    Retained
                               Stock     Capital    Earnings       Total
                              --------  ---------  -----------  -----------
<S>                           <C>       <C>        <C>          <C>
Balance, May 29, 1999         $87,036   $725,807   $1,744,798   $2,557,641

  Net loss for year                 -          -      (50,537)     (50,537)

  Redemption of common stock   (3,474)   (28,968)      (2,296)     (34,738)
                              --------  ---------  -----------  -----------

Balance, June 3, 2000          83,562    696,839    1,691,965    2,472,366

  Net loss for year                 -          -        7,694        7,694

  Redemption of common stock     (839)    (6,992)        (554)      (8,385)
                              --------  ---------  -----------  -----------

Balance, June 2, 2001          82,723    689,847    1,699,105    2,471,675

  Net loss for year                 -          -     (226,831)    (226,831)

  Redemption of common stock     (418)    (3,490)        (277)      (4,185)
                              --------  ---------  -----------  -----------

Balance, June 1, 2002         $82,305   $686,357   $1,471,997   $2,240,659
                              ========  =========  ===========  ===========
<FN>
The Notes to Financial Statements are an integral part of these statements.
</TABLE>


                                      -13-
<PAGE>
<TABLE>
<CAPTION>
                                      AMERICAN CONSUMERS, INC.

                                      STATEMENTS OF CASH FLOWS

              For the Fiscal Years Ended June 1, 2002, June 2, 2001, and June 3, 2000

----------------------------------------------------------------------------------------------------

                                                                    2002        2001         2000
                                                                 (52 Weeks)  (53 Weeks)   (52 Weeks)
                                                                -----------  -----------  ----------
<S>                                                             <C>          <C>          <C>
CASH FLOWS FROM OPERATING ACTIVITIES
  Net income (loss)                                             $ (226,831)  $    7,694   $ (50,537)
  Adjustments to reconcile net income (loss) to net cash
    provided by (used in) operating activities:
      Depreciation and amortization                                259,484      191,910     232,684
      Deferred income taxes                                         (3,827)      (8,760)    (27,748)
      (Gain) loss on sale of property and equipment                  8,472       (7,713)     (1,971)
      Change in operating assets and liabilities:
        Accounts receivable                                         (3,839)      35,676       8,928
        Inventories                                               (107,193)    (234,558)    200,449
        Prepaid expenses and other assets                           39,346      (26,530)    (40,395)
        Refundable income taxes                                    (43,891)           -      28,119
        Accounts payable and accrued liabilities                    42,897      140,040      70,973
        Federal and state income taxes                              (5,422)       5,716       3,706
                                                                -----------  -----------  ----------

          Net cash provided by (used in) operating activities      (40,804)     103,475     424,208
                                                                -----------  -----------  ----------

CASH FLOWS FROM INVESTING ACTIVITIES
  Purchase of certificate of deposit                              (450,000)    (450,000)   (434,887)
  Proceeds from maturity of certificate of deposit                 450,000      434,887     414,520
  Purchase of property and equipment                              (583,443)    (469,784)   (145,822)
  Proceeds from disposal of property and equipment                   5,000        8,380       8,300
                                                                -----------  -----------  ----------

          Net cash used in investing activities                   (578,443)    (476,517)   (157,889)
                                                                -----------  -----------  ----------

CASH FLOWS FROM FINANCING ACTIVITIES
  Net increase (decrease) in short-term borrowings                (386,871)     668,519    (178,280)
  Proceeds from long-term debt                                     627,012      169,421           -
  Principal payments on long-term debt                            (115,279)           -           -
  Principal payments on obligations under capital leases            (3,195)     (64,030)   (118,087)
  Redemption of common stock                                        (4,185)      (8,385)    (34,738)
                                                                -----------  -----------  ----------

    Net cash provided by (used in) financing activities            117,482      765,525    (331,105)
                                                                -----------  -----------  ----------

NET INCREASE (DECREASE) IN CASH
  AND CASH EQUIVALENTS                                            (501,765)     392,483     (64,786)

CASH AND CASH EQUIVALENTS, beginning of year                     1,245,135      852,652     917,438
                                                                -----------  -----------  ----------

CASH AND CASH EQUIVALENTS, end of year                          $  743,370   $1,245,135   $ 852,652
                                                                ===========  ===========  ==========

SUPPLEMENTAL DISCLOSURE OF CASH FLOW
  INFORMATION
    Cash paid (received) during the year for:
      Income taxes                                              $   13,266   $    4,369   $ (22,308)
      Interest                                                      72,944       25,342      55,206
                                                                ===========  ===========  ==========
<FN>
The  Notes  to  Financial  Statements  are an integral part of these statements.
</TABLE>


                                      -14-
<PAGE>
                           AMERICAN  CONSUMERS,  INC.

                        NOTES  TO  FINANCIAL  STATEMENTS

--------------------------------------------------------------------------------

Note  1.  Nature  of  Business  and  Summary of Significant Accounting Policies
          Nature  of  business:

          The  Company is engaged in a single line of business, the operation of
          a  chain  of retail grocery stores. The stores are located in Georgia,
          Tennessee,  and  Alabama  and  operate  under  the  name  of Shop-Rite
          Supermarket.

          Use  of  estimates:

          The  preparation  of financial statements in conformity with generally
          accepted  accounting  principles requires management to make estimates
          and  assumptions that affect certain reported amounts and disclosures.
          Accordingly,  actual  results  could  differ  from  those  estimates.

          Cash  and  cash  equivalents:

          For  purposes  of  reporting  cash  flows,  the  Company considers all
          highly-liquid  debt  instruments  with  an  original maturity of three
          months  or  less  to  be  cash  equivalents.

          Inventories:

          Inventories  are  stated  at  the  lower  of  average  cost or market.

          Depreciation  of  property  and  equipment:

          Depreciation  is  provided  on the straight-line and declining-balance
          methods  at rates based upon the estimated useful lives of the various
          classes  of  depreciable  property.

          Advertising  costs:

          Advertising costs are charged to operations when incurred. Advertising
          costs  charged  to operations were $619,875, $451,712, and $495,680 in
          2002,  2001,  and  2000,  respectively.

          Deferred  income  taxes:

          Deferred tax assets and liabilities are reflected at currently enacted
          income  tax  rates  applicable to the period in which the deferred tax
          assets  or  liabilities  are  expected  to  be realized or settled. As
          changes  in  tax  laws  or  rates are enacted, deferred tax assets and
          liabilities  are  adjusted  through  the  provision  for income taxes.


                                      -15-
<PAGE>

                           AMERICAN  CONSUMERS,  INC.

                        NOTES  TO  FINANCIAL  STATEMENTS

--------------------------------------------------------------------------------


Note  2.  Securities  Purchased  Under  Agreement  to  Resell

          Included  in  cash  and  short-term investments during fiscal 2000 and
          2001  were  securities  purchased  under agreement to resell. Under an
          arrangement  with  its  prior  lead  bank, the Company invested excess
          funds in U.S. Government or U.S. Government Agency securities that are
          purchased under an agreement to resell (reverse repurchase agreement).
          Under  this  type of program, the securities are purchased from a bank
          but  do not constitute deposits at the bank and are not insured by the
          Federal  Deposit  Insurance Corporation. The bank maintains possession
          of  the  securities,  but  title  of  ownership  passes to the Company
          according  to  the  terms  of  the agreement. The bank repurchases the
          securities  the  business  day  immediately  following  the  Company's
          purchase  date.  The  carrying  amount  of  securities purchased under
          agreement  to  resell  approximates  fair  value. Risk of market value
          deterioration is mitigated by the short-term nature of the transaction
          and  the  type  of securities purchased. The Company discontinued this
          program  when it replaced its lead bank during fiscal 2001. There were
          no  amounts outstanding under the arrangement at June 1, 2002 and June
          1,  2001.

Note  3.  Short-Term  Borrowings

          The Company had line-of-credit agreements with banks totaling $600,000
          and  $800,000  at  June  1,  2002  and June 2, 2001, respectively. The
          interest  rate  on  amounts  outstanding  under  the  line-of-credit
          agreements  fluctuates  with  the  prime  interest rate. The Company's
          certificate  of  deposit  is  pledged  as  collateral  under  these
          agreements.

          At  June 1, 2002 the Company had a short-term borrowings consisting of
          unsecured  notes  payable  to  Michael and Diana Richardson, principal
          shareholders  of  the  Company,  and to their son, Matthew Richardson.
          These  notes  provide  for interest at .25% below the bank's base rate
          and  are  payable  on  demand.

          A  summary  of short-term borrowing for the fiscal years ended June 1,
          2002  and  June  2,  2001,  is  as  follows:

                                                         2002        2001
                                                      -----------  ---------

          Line-of-credit agreements                   $  345,000   $456,500
          Loans payable to shareholders                   65,323     85,742
          Short-term note payable to bank                      -    254,952
                                                      -----------  ---------

            Total outstanding                         $  410,323   $797,194
                                                      ===========  =========

          Weighted average interest rate at year end        5.76%      8.27%
                                                      -----------  ---------

          Weighted average interest rate during year        7.25%      8.93%
                                                      -----------  ---------

          Maximum amount outstanding during year      $1,045,562   $810,469
                                                      ===========  =========

          Average amount outstanding during year      $  473,977   $244,707
                                                      ===========  =========

          The  carrying amount of short-term borrowings approximates fair value.


                                      -16-
<PAGE>
                           AMERICAN  CONSUMERS,  INC.

                        NOTES  TO  FINANCIAL  STATEMENTS

--------------------------------------------------------------------------------

Note  4.  Long-Term  Debt

<TABLE>
<CAPTION>
Long-term  debt consists of the following notes payable at June 1, 2002 and June
2,  2001:
                                                            2002      2001
                                                          --------  --------
<S>                                                       <C>       <C>
Note payable to Northwest Georgia Bank;
  principal and interest due in monthly installments
  of $11,381, through September 2006; interest at
  the prime rate plus 1.5%; collateralized by equipment,
  accounts receivable, and inventory                      $502,822  $      -

Note payable to Northwest Georgia Bank;
  principal and interest due in monthly installments
  of $3,576, through May 2006; interest at 6.25%;
  collateralized by equipment, inventory, and
  personal guarantees of the Company's President
  and Executive Vice President                             137,850   169,421

Vehicle installment loans; due in monthly installments
  of $1,305, through December 2004; collateralized
  by automobiles                                            40,482         -
                                                          --------  --------
                                                           681,154   169,421

      Less current maturities                              131,451    28,688
                                                          --------  --------

      Total long-term debt                                $549,703  $140,733
                                                          ========  ========
</TABLE>

     The  fair  value  of the Company's long-term debt approximates the carrying
     amount  reported  in  the balance sheet based on current interest rates for
     similar  types  of  borrowings.

     The  aggregate  maturities or principal payments required on long-term debt
     for  each  of  the  five  years subsequent to June 1, 2002, are as follows:

                  Year                     Amount
                --------                  --------
                  2003                    $131,451
                  2004                     159,410
                  2005                     162,199
                  2006                     162,903
                  2007                      65,191


                                      -17-
<PAGE>
                           AMERICAN  CONSUMERS,  INC.

                        NOTES  TO  FINANCIAL  STATEMENTS

--------------------------------------------------------------------------------


Note  5.  Lease  Commitments

          The  Company  leases  the  facilities  in  which  its  retail  grocery
          operations  are  located  under  noncancelable  operating  leases that
          expire  at  various dates through April 2006. Substantially all of the
          leases  include  renewal options. The following is a schedule by years
          of future minimum rental payments required under operating leases that
          have  initial  or remaining noncancelable lease terms in excess of one
          year  as  of  June  1,  2002:

             Fiscal                      Minimum
          Year Ending                    Rentals
          ------------                ------------

              2003                    $    410,058
              2004                         283,985
              2005                         171,245
              2006                         147,025
              2007                          68,417
                                      ------------

                 Total                $  1,080,730
                                      ============

          Rental  expense for the fiscal years ended June 1, 2002, June 2, 2001,
          and  June  3,  2000,  is  as  follows:

                                               2002      2001      2000
                                             --------  --------  --------

          Minimum rentals                    $522,135  $451,549  $446,002
          Contingent rentals based on sales     7,402    13,360    15,389

            Total                            $529,537  $464,909  $461,391
                                             ========  ========  ========


Note  6.   Federal  and  State  Income  Taxes

          The  components  of income tax expense for the fiscal years ended June
          1,  2002,  June  2,  2001,  and  June  3,  2000,  are  as  follows:

                                                    2002       2001      2000
                                                  ---------  --------  ---------

          Current tax expense (benefit):
            Federal                               $(38,463)  $ 4,649   $  4,583
            State                                   (1,585)    1,437        933
                                                  ---------  --------  ---------

                                                   (40,048)    6,086      5,516
                                                  ---------  --------  ---------
          Deferred tax expense (benefit):
            Federal                                 (3,297)   (7,438)   (22,431)
            State                                     (530)   (1,322)    (5,317)
                                                  ---------  --------  ---------

                                                    (3,827)   (8,760)   (27,748)
                                                  ---------  --------  ---------

              Total income tax expense (benefit)  $(43,875)  $(2,674)  $(22,232)
                                                  =========  ========  =========


                                      -18-
<PAGE>
                           AMERICAN  CONSUMERS,  INC.

                        NOTES  TO  FINANCIAL  STATEMENTS

--------------------------------------------------------------------------------


Note  6.   Federal  and  State  Income  Taxes  (continued)

          A  reconciliation  of income tax expense computed by applying the U.S.
          Federal statutory rate to income before income taxes and actual income
          tax  expense  is  as follows:

<TABLE>
<CAPTION>
                                                     2002       2001      2000
                                                   ---------  --------  ---------
<S>                                                <C>        <C>       <C>
          Federal income tax expense (benefit)
             computed at the statutory rate        $(88,800)  $   800   $(11,000)
          State income tax, net of federal
             income tax benefit                     (10,700)      300     (3,700)
          Deferred tax asset valuation allowance     24,100         -          -
          Other                                      31,525    (3,774)    (7,532)
                                                   ---------  --------  ---------

               Total income tax expense (benefit)  $(43,875)  $(2,674)  $(22,232)
                                                   =========  ========  =========
</TABLE>

          The  tax  effects  of  significant temporary differences that comprise
          deferred tax assets and liabilities at June 1, 2002, and June 2, 2001,
          are  as  follows:

<TABLE>
<CAPTION>
                                                           2002       2001
                                                         ---------  ---------
<S>                                                      <C>        <C>

          Assets:
            Deferred income                              $ (5,549)  $(11,602)
            Other                                         (48,954)   (19,815)

          Liabilities:
            Depreciable basis of property and equipment    54,503     33,939
             Other                                              -      1,305
                                                         ---------  ---------

                                                         $      -   $  3,827
                                                         =========  =========
</TABLE>

          At  June 1, 2002, the Company has net operating loss carryforwards for
          federal  and  state  income  tax  purposes  of  $45,000  and $221,000,
          respectively.  These  net operating loss carryforwards may be utilized
          to  offset future taxable income through 2022. A deferred tax asset of
          $24,100  has  been  recognized  for the carryforwards. However, no tax
          benefit  has  been  reported  in the 2002 financial statements for the
          loss  carryforwards  because the tax benefit of the loss carryforwards
          has  been  offset  by  a  $24,100  valuation  allowance.

Note  7.   Sale  of  Assets  and  Deferred  Income

          On  April 29, 1988, the Company sold its strip shopping center located
          in  Chatsworth,  Georgia.  The  strip shopping center consisted of two
          separate  buildings  with a total of 42,900 square feet. Approximately
          18,540  square  feet  of the shopping center were leased to others and
          approximately  24,360  square  feet  were  used by the Company for its
          retail  grocery  store.


                                      -19-
<PAGE>
                           AMERICAN  CONSUMERS,  INC.

                        NOTES  TO  FINANCIAL  STATEMENTS

--------------------------------------------------------------------------------

Note  7.  Sale  of  Assets  and  Deferred  Income  (continued)

          Effective  as  of  the date of sale, the Company leased back its store
          location  in  the  center for a period of 15 years. The minimum annual
          rental  payments  of $91,350 are included in the minimum annual rental
          payments  of  operating leases described in Note 5. The gain resulting
          from  the  sale  of  these  assets  has  been  deferred  for financial
          reporting purposes and is being amortized over the 15-year lease term.

Note  8.  Employee  Benefit  Plan

          The  Company  has  adopted  a  401(k)  employee  benefit plan covering
          substantially  all  employees  who  have  met  minimum service and age
          requirements.  The  service  and  age requirements were waived for the
          initial  plan  participants  to encourage participation. The Company's
          annual  contribution  is  discretionary. The Company's contribution to
          the  plan  was  $7,500  in  2002  and  2001.

Note  9.  Concentration  of  Credit  Risk

          The  Company  maintains  a  certificate  of  deposit and other deposit
          accounts  at financial institutions in amounts that exceed the Federal
          Deposit  Insurance  Corporation  (FDIC)  insurance limit. The total of
          deposits  that  exceeded the FDIC insurance limit was $656,294 at June
          1,  2002.  The  Company  believes  that  maintaining deposits in these
          financial  institutions  does  not represent a significant credit risk
          and  that the Company benefits from favorable banking relationships as
          a  result  of  maintaining  deposits  with  these  institutions.

Note  10.  Related  Party  Transactions

          As described in greater detail in Note 3 above, the Company finances a
          portion  of  its  working  capital  requirements  through  borrowings
          consisting  of  two  unsecured  notes,  payable  to  Michael and Diana
          Richardson,  principal  shareholders of the Company, and to their son,
          Matthew Richardson. These notes bear interest at a rate per annum .25%
          below  the  base  rate of interest charged on the Company's borrowings
          from  its  lead  bank  and  are  payable  on  demand.


                                      -20-
<PAGE>