SECURITIES AND EXCHANGE COMMISSION
                          Washington, D.C. 20549

                               Form 10-QSB

                Quarterly Report Under Section 13 or 15(d)
                  of the Securities exchange Act of 1934

For Quarter Ending June 30, 1997

Commission File Number #33-38119-C

                       THE KENSINGTON COMPANY, INC.

          (Exact name of registrant as specified in its charter)

Minnesota                                          41-1610632    
(State or other                                (IRS Employer
jurisdiction of                              Identification No.)
incorporation)

Suite 1150 Interchange Tower, 600 S. Hy. 169, Minneapolis,                     
        
                           Minnesota 55426  
(Address of principal executive offices)               (Zip code)

Registrant's telephone number, including area code (612) 546-2075

Indicate by Check mark whether the registration (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or of such shorter period that the
registrant was required to file such reports), and 92) has been subject to
such filing requirements for the past 90 days.

Yes   *                                                    No         

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date:

                  Weighted number of shares are 3,021,450

Part I.  Financial Information

                       Quarter Ended  June 30, 1997

                                 GENERAL

The following financial information is submitted in response to the
requirements of Form 10-QSB and does not purport to be financial statements
prepared in accordance with generally accepted accounting principles.  Certain
information and footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principles have been
condensed or omitted, although the Company believes the disclosures that are
made are adequate to make the information presented not misleading.  Further,
in the opinion of the management, the interim financial statements reflect
fairly the financial position and results of operations for the period
indicated.

The results of operations for the quarter ended as stated above are not
necessarily indicative of results to be expected for the entire fiscal year
ending December 31st.

<PAGE>

Item 1.  Financial Statements

The balance sheet of The Kensington Company, Inc. (the "Company") as of the
Quarter stated above, and the related statement of income and changes in
financial position and note thereto are incorporated herein by reference to
the Company's quarterly report.


Item 2.   Management's Discussion and Analysis of Financial           
                                                                      
                  Condition and Results of Operations


Results of Operations
     For the quarter being reported on, the company had revenues of $771k as
compared to $410k for the same period in 1996. Operating profits for the
period were $266k as compared to $93k for 1996. For the year, revenues are up
over 53% over those of 1996.
     This increase is due to the fact that in 1996 the company's largest
customer had a change in management structure, which resulted in a lag in
receiving orders. The backlog of orders continues to be strong indicating the
3rd and 4th quarters should be consistent with the first half of the year. As
was stated at the end of 1996, the company has written off virtually all its
oil & gas operations, thus the large discrepancy in total assets. Overall the
company reported a net income of $57k for the quarter. This was due to the
continued strong sales and reduced expenses in all entities. 

Liquidity and Capital Resources
     For the quarter, the Company had a net income from operations of $76k.
Management of the Company is of the opinion that the Company will continue to
show an operating profit through the foreseeable future. However, the company
still has not been able to find alternative financing for debt which will
reach maturity this year. This will result in a serious cash flow problem .
Management is currently negotiating with the debtors to roll over their debt
and also is in discussions with Mortgage bankers to provide alternative
financing. 
     During the period stated the Registrant did not sell to directors,
management and others, any common stock.

Inflation

     The rate of inflation has had a great impact on the Company's results of
operations and is expected to have a continued impact on continuing operations
due to the increase in wood product costs and the fact that we have to bid
most of our projects and we can not pass all of the cost increases to our
customers.

<PAGE>

Part II.  Other Information

Item 1.  Legal Proceedings - None

Item 2.  Changes in Securities - None

Item 3.  Defaults upon Senior Securities - None

Item 4.  Submission of Matters to a Vote of Security Holders -             
None

Item 5.  Other Information - None

Item 6.  Exhibits and Reports on Form 8-K and the October 18, 1995          
S-8 filing as described in Item 2 herein.

                                SIGNATURES

Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

                                                                               
                         THE KENSINGTON COMPANY, INC.

                                                                               
                                                       
                          Mark Haggerty
                          Mark Haggerty
                                                                               
                         Chief Executive Officer

                                   Jeff Etten
                                   Jeff Etten, C.F.O.
                                  
Dated:  February 17, 1998
                          Minneapolis, Minnesota

<PAGE>

<PAGE>
THE KENSINGTON COMPANY, INC. AND SUBSIDIARIES     
CONSOLIDATING BALANCE SHEET   
JUNE 30, 1997 AND 1996 (UNAUDITED) 

                                        1997           1996 
ASSETS    
Current assets:     
  Cash                                 $20,261            $12,419 
  Accounts receivable                  185,925            107,773   
  Inventories                          181,141            140,613    
  Other current assets                   2,527              7,415
     Total current assets              389,854             268,220   

Other assets:  
  Investment in oil and gas properties, net    87,854         1,206,278    
  Investment in oil and gas partnerships       44,832            47,981   

  Investment in Ives                             0     
  Investment in KEC partnerships                 0     
  Property and equipment, net               308,354             337,754    
  Notes receivable - related parties         24,786              30,625    
     Total other assets                     465,826            1,622,638   

                                           $855,680           $1,890,858

LIABILITIES AND STOCKHOLDERS' EQUITY    

Current liabilities:     
  Note payable -                            $16,548              $9,200    
  Note payable - related parties            278,556             334,333 
  Current portion of long-term debt         495,711              93,310  

  Current portion of obligations under 
  capital leases                             17,341               26,548   
  Accounts payable                          281,088              249,177   
  Accrued payroll & related taxes           102,425               84,102   
  Accrued interest                           32,747              29,397    
  Accrued Expenses                           21,094              75,148    
Intercompany                                      0                   0     
     Total current liabilities            1,245,510             901,215    

Long-term debt, net of current portion      130,110             578,619    
Obligations under capital leases, 
net of current portion                       10,000              55,017    
Minority interest in consolidated 
Subsidiaries                                 11,239              13,332    
     Total liabilities                    1,396,859           1,548,183    


STOCKHOLDERS' EQUITY     
  Common stock                            3,671,816           3,660,377    
  Additional paid-in capital                      0                   0     
  Accumulated deficit                    (3,915,663)         (3,020,370)   
  Stock subscriptions receivable           (297,332)           (297,332)     
     Total stockholders' equity            (541,179)            342,675    

                                           $855,680          $1,890,858    

<PAGE>

THE KENSINGTON COMPANY, INC. AND SUBSIDIARIES     
CONSOLIDATING STATEMENT OF OPERATIONS   
FOR THE QUARTER ENDED JUNE 30, 1997 AND 1996 
                                   (UNAUDITED)    

                                                  1997      1996 

Revenues: 
  Product sales                                  $770,626    $404,238 
  Distributions from oil and gas partnerships           0       4,875    
  Oil and gas sales                                     0         445    
     Total revenues                               770,626     409,558 

Cost of sales: 
  Cost of products sold                           504614    316569    
  Oil and gas costs                                    0         0    
     Total cost of sales                          504614    316569    

     Gross profit                                 266012     92989    

Operating expenses                                190131    175970    

Income (loss) from operations -37103               75881    (82981)   

Other income (expense):  
  Interest expense                               (19373)    (58858)   
  Litigation settlement                                0         0    
  Minority Interest in Earnings of 
  Consolidated Oil & Gas Ptsp                          0      (332)
  Miscellaneous income                                 0         0  
    Total other income (expense)                  (19373)   (59180)   

Income (loss) before income taxes and 
extraordinary item                                 56508    (142161)
  Provision for income taxes (benefit)                 0           0 

Income before extraordinary item                   56508    (142161)
  Extinguishment of debt, net of income taxes of $0    0          0

Net income (loss)                                  56508    (142161)

Accumulated deficit, beginning                   (3978135)    (2879598)

Accumulated deficit, ending                      (3921627)    (3021759)

Earnings Per Share             0.018702278707243     (0.046109460546459)
                                   
WEIGHTED NUMBER OF SHARES OUTSTANDING             3021450   2945894   

<PAGE>

<PAGE>
THE KENSINGTON COMPANY, INC. AND SUBSIDIARIES     
CONSOLIDATING STATEMENT OF CASH FLOWS   
FOR THE QUARTER ENDED JUNE 30, 1997 & 1996   
                                   (UNAUDITED)    

                                              1997         1996

Cash flows from operating activities:   
  Net income (loss)                          56508          (141839)
  Adjustments to reconcile net income (loss) 
   to cash flows from operating activities:  
   Depreciation, depletion and amortization        9060            16085   
   Extinguishment of debt                                              0    
   Changes in operating assets and liabilities:   
    Accounts receivable                           123349          182595   
    Inventories                                   (21300)        22768     
    Other current assets                           30525            31188  
    Other assets                                      0               0    
    Accounts payable                              (27169)        (23990)
    Other current liabilities                     (54612)          7259   
      Cash flows from operating activities        116361          61298   

Cash flows from investing activities:   
 Distributions from Unconsolidated Gas & 
 Oil Partnerships                                     0              4875  
  Decrease in notes receivable - related parties      0              1500
  Purchase of property and equipment               4660            (1364)  
  Sale of Stock                                       0            11215   
      Cash flows from investing activities         4660            16226   

Cash flows from financing activities:   
  Increase (decrease) in notes payable - 
  related parties                                  1725           (11623) 
  Proceeds short, long-term debt                   (95993)        (37598)  
  Payments on long-term debt                      (14816)         (22305)    
  Payments on obligations under capital leases         (5999)      (3000)
     Cash flows from financing activities        (115083)         (74526)
     
Increase (decrease) in cash                       (3382)            2998

Cash, beginning                                   23643             9421   
                                                       
Cash, ending                                      20261            12419