SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                    FORM 10-Q

(Mark One)
|X|               QUARTERLY   REPORT  PURSUANT  TO  SECTION  13  OR 15(d) OF THE
                  SECURITIES EXCHANGE ACT OF 1934


For the fiscal quarterly period ended        September 28, 1996
                                      -------------------------------

                                       OR
| |               TRANSITION  REPORT  PURSUANT  TO  SECTION  13 OR 15(d)  OF THE
                  SECURITIES EXCHANGE ACT OF 1934

For the transition period from                 to
                              -----------------  ----------------

                         Commission file number 0-19873
                                                -------

                                BELL SPORTS CORP.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)


              Delaware                                        36-3671789
--------------------------------------------------------------------------------
    (State or other jurisdiction of                        (I.R.S. employer
    incorporation or organization)                        identification no.)

    15170 N. Hayden Rd. Suite 1, Scottsdale, Arizona             85260
--------------------------------------------------------------------------------
    (Address of principal executive offices)                   (Zip Code)

                                 (602) 951-0033
--------------------------------------------------------------------------------
              (Registrant's telephone number, including area code)

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

Indicate  by check  mark  whether  the  registrant:  (1) has filed  all  reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant  was required to file such reports) Yes X No and (2) has been subject
to such filing requirements for the past 90 days. Yes  X  No   .
                                                      ---   --- 

                      APPLICABLE ONLY TO CORPORATE ISSUERS:

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

Common Stock, $.01 par value       October 30, 1996            13,700,960
----------------------------       ----------------            ----------
Class                              Date                     Number of shares
                                       1
<PAGE>
                                BELL SPORTS CORP.
                               INDEX TO FORM 10-Q

                                     PART I


<TABLE>
<CAPTION>
                                                                                Page
                                                                               Number
                                                                               ------
<S>                                                                            <C>
Bell Sports Corp. and Subsidiaries Balance Sheets
  as of September 28, 1996, and June 29, 1996                                     3

Bell Sports Corp. and Subsidiaries Consolidated Statements of Operations
  for the three months ended September 28, 1996, and
  September 30, 1995                                                              4

Bell Sports Corp. and Subsidiaries Consolidated Statements of Cash Flows
  for the three months ended September 28, 1996
  and September 30, 1995                                                          5

Notes to Financial Statements                                                   6 - 10

Management's Discussion and Analysis of
  Financial Condition and Results of Operations                                11 - 13

</TABLE>


                                     PART II

<TABLE>
<S>                                                                              <C>
Items 1 to 6                                                                     14

Signatures                                                                       15
</TABLE>
                                       2
<PAGE>
PART 1.           Financial Information
Item 1.           Financial Statements

                       BELL SPORTS CORP. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                             (dollars in thousands)

<TABLE>
<CAPTION>
                                                            September 28,   June 29,
                                                                1996          1996
                                                                ----          ----
                                                             (unaudited)
<S>                                                           <C>          <C>
ASSETS
------
Cash and cash equivalents                                     $  24,951    $  23,140
Marketable securities                                             5,118        7,996
Accounts receivable                                              60,428       75,651
Inventories                                                      61,321       59,413
Other current assets                                             18,684       17,285
                                                              ---------    ---------
             Total current assets                               170,502      183,485

Property, plant and equipment                                    25,492       24,722
Goodwill                                                         70,704       71,245
Intangibles and other assets                                     19,262       19,183
                                                              ---------    ---------
              Total assets                                    $ 285,960    $ 298,635
                                                              =========    =========

LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
Accounts payable                                              $  10,954    $  11,797
Accrued expenses                                                 13,120       16,752
Accrued compensation and employee benefits                        4,003        4,392
Notes payable and current maturities of long-term
     debt and capital lease obligations                           1,099        1,070
                                                              ---------    ---------
             Total current liabilities                           29,176       34,011

Long-term debt and capital lease obligations                    116,330      124,501
Other liabilities                                                 3,952        4,082
                                                              ---------    ---------
             Total liabilities                                  149,458      162,594
                                                              ---------    ---------
Stockholders' equity:
Preferred stock; $.01 par value; authorized 1,000,000
     shares, none issued
Common stock; $.01 par value; authorized 25,000,000 shares;
issued 14,224,360 shares; outstanding 13,700,960 shares             142          142
Additional paid-in capital                                      141,738      141,647
Unrealized holding losses on marketable securities                 --           (461)
Foreign currency translation adjustments                            (10)          84
Retained earnings                                                   149          146
                                                              ---------    ---------
                                                                142,019      141,558
Less - 523,400 shares of common stock in treasury, at cost       (5,517)      (5,517)
                                                              ---------    ---------
             Total stockholders' equity                         136,502      136,041
                                                              ---------    ---------

             Total liabilities and stockholders' equity       $ 285,960    $ 298,635
                                                              =========    =========
</TABLE>
        See accompanying notes to these consolidated financial statements
                                       3
<PAGE>
                       BELL SPORTS CORP. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                (unaudited; in thousands, except per share data)



<TABLE>
<CAPTION>
                                                    Three Months Ended
                                                --------------------------
                                                September 28, September 30,
                                                     1996        1995
                                                     ----        ----
<S>                                                <C>         <C>
Net sales                                          $ 62,068    $ 57,675
Cost of sales                                        44,560      41,591
Inventory write-up                                     --         5,949
                                                   --------    --------
Gross profit                                         17,508      10,135

Selling, general and administrative expenses         15,279      14,589
Amortization of goodwill and intangible assets          862         587
Consolidation costs                                   1,358         387
Net investment income                                (1,792)     (1,031)
Interest expense                                      1,796       2,318
                                                   --------    --------

Income (loss) before income taxes                         5      (6,715)
Provision (benefit) for income taxes                      2      (1,343)
                                                   --------    --------

Net income (loss)                                  $      3    $ (5,372)
                                                   ========    ========

        Net income (loss) per common and           $   0.00    $  (0.38)
            common equivalent share                ========    ========
           


        Weighted average number of common and
            common equivalent shares outstanding     13,754      14,131
                                                   ========    ========
</TABLE>
       See accompanying notes to these consolidated financial statements
                                       4
<PAGE>
                       BELL SPORTS CORP. AND SUBSIDIARIES
                 CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
                            (unaudited; in thousands)


<TABLE>
<CAPTION>
                                                                      Three Months Ended
                                                                  --------------------------
                                                                  September 28, September 30,
                                                                       1996        1995
                                                                       ----        ----
<S>                                                                  <C>         <C>
CASH FLOWS PROVIDED BY OPERATING ACTIVITIES:
     Net cash provided by operating activities                       $  8,933    $  4,909
                                                                     --------    --------


CASH FLOWS PROVIDED BY (USED IN) INVESTING ACTIVITIES:
  Capital expenditures                                                 (2,170)     (1,237)
  Net sale of marketable securities                                     3,162      15,073
  Acquisition of other businesses                                        --          (544)
                                                                     --------    --------
     Net cash provided by investing activities                            992      13,292
                                                                     --------    --------

CASH FLOWS PROVIDED BY (USED IN) FINANCING ACTIVITIES:
  Proceeds from issuance of stock                                        --            22
  Treasury stock purchases                                               --        (3,779)
  Net payments on notes payable, long-term debt and capital leases     (8,116)    (22,160)
                                                                     --------    --------
     Net cash used in financing activities                             (8,116)    (25,917)
                                                                     --------    --------


Effect of exchange rate changes on cash                                     2         (12)
                                                                     --------    --------


Net increase (decrease) in cash and cash equivalents                    1,811      (7,728)
Cash and cash equivalents at beginning of period                       23,140      72,018
                                                                     --------    --------
Cash and cash equivalents at end of period                           $ 24,951    $ 64,290
                                                                     ========    ========
</TABLE>
       See accompanying notes to these consolidated financial statements
                                       5
<PAGE>
                       BELL SPORTS CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1 - THE COMPANY AND ITS SIGNIFICANT ACCOUNTING POLICIES

Bell Sports Corp. and its wholly-owned subsidiaries (collectively,  the Company)
design,  manufacture and market bicycle parts and accessories,  bicycle helmets,
bicycles and automotive racing helmets.

Consolidation
-------------
The consolidated  financial statements include the accounts of Bell Sports Corp.
and its wholly-owned  subsidiaries.  All material intercompany  transactions and
balances have been eliminated in consolidation.

Accounting Period
-----------------
The Company's  fiscal year is either a fifty-two or fifty-three  week accounting
period ending on the Saturday that is nearest to the last day of June.

Unaudited Information and Basis of Presentation
-----------------------------------------------
The  consolidated  balance  sheet as of  September  28, 1996 and  statements  of
operations and condensed cash flows for all periods included in the accompanying
financial  statements have not been audited.  In the opinion of management these
financial statements include all normal and recurring  adjustments necessary for
a fair presentation of such financial information. The results of operations for
the interim periods are not necessarily  indicative of the results of operations
to be expected for the full year.

The financial  information  included  herein has been  prepared  pursuant to the
rules  and  regulations  of the  Securities  and  Exchange  Commission.  Certain
information and footnote  disclosures  normally included in financial statements
prepared in accordance with generally accepted  accounting  principles have been
omitted pursuant to such rules and regulations. Audited financial statements for
the fiscal years ended June 29, 1996, July 1, 1995 and July 2, 1994 are included
in the Company's 1996 annual report to stockholders.

Income Per Share Information
----------------------------
Income per common and common  equivalent  share is computed  using the  weighted
average number of common stock and common stock  equivalent  shares  outstanding
during the  periods,  using the  treasury  stock  method for stock  options  and
warrants.  Common  equivalent  shares are excluded from the computation if their
effect is anti-dilutive  except that,  pursuant to Staff Accounting Bulletin No.
83 of the  Securities and Exchange  Commission,  certain stock options that were
granted at prices  below the initial  public  offering  price  during the twelve
month period immediately  preceding the April 1992 initial public stock offering
have been treated as common stock equivalents for all periods  presented.  Fully
diluted  net income per common  share for all periods  included in  accompanying
financial  statements has not been presented since an assumed  conversion (using
the if converted  method,  which  includes the adjustment of reported net income
for interest charges on a net-of-tax  basis) of the Company's 4 1/4% convertible
debentures (see Note 4) would be anti-dilutive.

Marketable Securities
---------------------
All marketable  securities,  consisting of preferred equity  securities and U.S.
Government  Agency  instruments  have  been  classified  as   available-for-sale
securities  and are  reported  at fair value.  The fair value of the  marketable
securities  was obtained from  published  market quotes or outside  professional
pricing sources. The cost of the Company's  marketable  securities available for
sale approximated the fair market value of such securities at September 28, 1996
and exceeded the fair market value of such securities by approximately $461,000,
at June 29,  1996.  Such excess was  recorded as a  reduction  to the  Company's
stockholders' equity at June 29, 1996.
                                       6
<PAGE>
During the first  quarter of fiscal  1997,  the  Company  was  successful  in an
arbitration case related to the handling of certain marketable  securities by an
outside investment advisor. The settlement proceeds, net of related expenses and
expected losses to sell certain securities in the net amount of $1.3 million, is
included in net investment income.

Accounts Receivable
-------------------
Accounts  receivable  at  September  28,  1996  and  June  29,  1996  are net of
allowances for doubtful accounts of $3.1 million and $3.4 million, respectively.

Property, Plant and Equipment
-----------------------------
Property, plant and equipment at September 28, 1996 and June 29, 1996 are net of
accumulated depreciation of $15.5 million and $14.1 million, respectively.


NOTE 2 - INVENTORIES

Inventories consist of the following:

(in thousands)                                    September 28,         June 29,
                                                     1996                1996
                                                     ----                ----

Raw materials                                       $ 5,895             $ 5,330
Work in process                                       2,558               2,315
Finished goods                                       52,868              51,768
                                                    -------             -------
     Total                                          $61,321             $59,413
                                                    =======             =======


As a result of the acquisition of SportRack in May 1995 and the merger with AMRE
in July 1995,  inventories  were written-up an aggregate of $13.0 million at the
respective  acquisition  dates.  For the three months ended  September 30, 1995,
$5.9 million  relating to the  inventory  write-up  was charged  against cost of
sales.


NOTE 3 - PRODUCT LIABILITY AND CONTINGENCIES

Product Liability
-----------------
The Company is subject to various product  liability claims and/or suits brought
against  it for  claims  involving  damages  for  personal  injuries  or deaths.
Allegedly,  these  injuries or deaths relate to the use by claimants of products
manufactured  by the Company and, in certain  cases,  products  manufactured  by
others.  The ultimate  outcome of these existing claims and any potential future
claims cannot presently be determined. Management believes that existing product
liability  claims/suits  are  defensible  and that,  based on the Company's past
experience and assessment of current  claims,  other than the February 1996 case
described  below,  the aggregate of defense costs and any uninsured  losses will
not have a material  adverse  impact on the  Company's  liquidity  or  financial
position.

The cost of product liability insurance fluctuated greatly in past years and the
Company opted to self-insure  claims for certain  periods.  The Company has been
covered by product  liability  insurance  since July 1, 1991.  This insurance is
subject  to a  self-insured  retention.  There is no  assurance  that  insurance
coverage will be available or economical in the future.
                                       7
<PAGE>
The Company sold its motorcycle helmet manufacturing  business in June 1991 in a
transaction  in which the  purchaser  assumed  all  responsibility  for  product
liability  claims  arising  out of  helmets  manufactured  prior  to the date of
disposition  and the Company  agreed to use its in-house  defense team to defend
these  claims at the  purchaser's  expense.  If the  purchaser is for any reason
unable to pay any  judgment,  settlement  amount or defense costs arising out of
these  claims,  the Company  could be held  responsible  for the payment of such
amounts or costs.  The Company  believes that the  purchaser  does not currently
have the financial resources to pay any significant judgment, settlement amount,
or defense costs.

On February 2, 1996,  a Toronto,  Canada jury  returned a verdict  against  Bell
based on injuries arising out of a 1986 motorcycle accident. The jury found that
Bell was 25%  responsible  for the injuries  with the remaining 75% of the fault
assigned to the plaintiff and the other  defendant.  Unless  reversed on appeal,
the verdict is  estimated to be between $3.0 and $4.0  million,  which  includes
associated legal fees and tax implications.

The Company has filed an appeal of the  Canadian  verdict.  Although the Company
cannot predict the outcome of an appeal, the Company currently has adequate cash
balances and sources of capital  available to satisfy the judgment if the appeal
is unsuccessful.  Accordingly,  the Company currently does not believe the claim
will have a material  adverse effect on liquidity or the financial  condition of
the Company.  Although the Company maintains product liability  insurance,  this
claim arose during a period in which the Company was  self-insured.  The Company
currently does not have a reserve for this judgment.

Environmental Litigation
------------------------
In the ordinary  course of its  business,  the Company is required to dispose of
certain waste at off-site locations. During 1993, the Company became aware of an
investigation  by the Illinois  Environmental  Protection  Agency (the "Illinois
Agency") of a waste disposal site, owned by a third party,  which was previously
utilized by the Company. As a result of that investigation,  the Illinois Agency
informed the Company that certain of the Company's practices with respect to the
identification,  storage and disposal of hazardous  waste and related  reporting
requirements  may not have complied with the applicable  law. On March 14, 1995,
the  State of  Illinois  (the  "State")  filed a  complaint  with  the  Illinois
Pollution Control Board (the "Pollution  Control Board") against the Company and
the  disposal  site owner based on the same  allegations.  The  complaint  seeks
penalties  not  exceeding  statutory  maximums  and  such  other  relief  as the
Pollution Control Board determines appropriate.  The disposal site owner filed a
cross-claim  against the Company that seeks to have penalties  assessed  against
the Company and not against the disposal  site owner.  Any penalties as a result
of the cross-claim would be payable to the State. The State and the Company have
agreed in principle to a settlement in which the Company will pay $69,000 to the
State. The Company is seeking dismissal of the cross-claim on several grounds.

Additionally,  the Illinois Agency has been  negotiating  with the disposal site
owner with respect to the procedures and actions necessary to close the disposal
site.  The extent  and  nature of any  actions  which may be taken  against  the
Company with respect to this matter cannot presently be determined

Shareholder Litigation
----------------------
On February 16, 1995, an AMRE  shareholder  filed a lawsuit,  on his own behalf,
and a purported  class  action,  against AMRE and its  directors in the Chancery
Court of the State of  Delaware,  alleging  various  breaches of  fiduciary  and
common law duties and  requesting  both  monetary  and  injunctive  relief.  The
alleged  basis  for the  claims  are the  action  of AMRE and its  directors  in
connection  with the  authorization  and  approval  of the AMRE Merger with Bell
Sports Corp.  The AMRE Merger was  consummated  on July 3, 1995 and the case has
been inactive since that date. On October 2, 1995, the Company filed a motion to
dismiss the case.
                                       8
<PAGE>
NOTE 4 - NOTES PAYABLE, LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS

The Company has approximately $117 million in notes payable,  long-term debt and
capital  lease  obligations  outstanding  at September 28, 1996. Of this amount,
$86.25  million  relates  to the  outstanding  balance on the  Company's  4 1/4%
convertible subordinated debentures.  Maturing November 15, 2000, the debentures
are convertible  into common stock at any time prior to maturity at a conversion
price of $54.06 per share. Interest on the debentures is payable  semi-annually.
The debentures  are  redeemable at the Company's  option at any time on or after
November 15, 1996, at specified redemption prices.

In  February  1996,  the  Company  entered  into a $100  million  multicurrency,
revolving line of credit (the "Revolving  Credit") with a syndicated bank group.
This facility  replaces prior revolving credit  facilities that were used by the
Company's  North  American  operations.  At September 28, 1996, a total of $27.1
million was outstanding under the credit facility.

The Revolving Credit,  which expires in December 1999, provides the Company with
several  interest  rate  options,  including  U.S.  prime,  LIBOR plus a margin,
Canadian prime plus the applicable  LIBOR margin less 0.50%,  Canadian  banker's
acceptance plus the LIBOR margin plus 0.125%, and short-term fixed rates offered
by the agent bank in the loan  syndication.  The LIBOR margin is currently 1.25%
per annum,  but it can range between 0.75% and 1.50%  depending on the Company's
interest coverage ratio.  Under the Revolving Credit, the Company is required to
pay a quarterly  commitment  fee on the unused portion of the facility at a rate
that ranges from 0.15% to 0.30% per annum.  At September  28, 1996 the quarterly
commitment fee was 0.25% per annum.

The Revolving Credit contains certain financial covenants,  the most restrictive
of which are a minimum interest  coverage ratio, a maximum funded debt ratio and
a minimum  consolidated  tangible net worth amount.  The  Revolving  Credit also
contains  covenants  that  restrict the amount of cash  dividends as well as the
amount that the  Company  can  repurchase  of its  subordinated  debt and common
stock.

In August,  1996,  the  Company  amended  the  Revolving  Credit to grant to the
syndicated  bank group a  security  interest  in U.S.  accounts  receivable  and
inventories.  The security  interest is subject to automatic release by the bank
group upon the achievement of certain  financial ratios after September 1, 1997.
The amendment among other things waived a default in the interest coverage ratio
covenant as of June 29, 1996.

NOTE 5 - COMMON STOCK

From  time  to  time,  the  Company  has  granted  to  its  executive  officers,
non-employee directors and certain other employees options to purchase shares of
the  Company's  Common  Stock.  At  September  30,  1996,  options  to  purchase
approximately 1,607,000 shares of Common Stock were outstanding.

On August 24, 1995, the Company announced a stock repurchase program authorizing
the repurchase of up to 10% of the  outstanding  shares of the Company's  Common
Stock from time to time in open  market or private  transactions.  The timing of
any  repurchases and the price and number of shares  repurchased  will depend on
market  conditions  and other  factors.  As of October 30, 1996, the Company had
repurchased  a total  of  523,400  shares  at an  aggregate  purchase  price  of
approximately  $5.5  million.  Shares  repurchased  may be  retired  or used for
general corporate purposes.
                                       9
<PAGE>
NOTE 6 - CONSOLIDATION COSTS

On June 27, 1995,  the  Company's  stockholders  approved the issuance of Common
Stock in connection  with the  Agreement  and Plan of Merger dated  February 15,
1995 among the  Company,  Bell  Merger  Co., a  wholly-owned  subsidiary  of the
Company,   and  American   Recreation  Company  Holdings,   Inc.  ("AMRE").   In
contemplation of the merger, the Company formulated a program (the "Program") to
consolidate  and integrate the operations of Bell,  SportRack  (acquired May 15,
1995) and AMRE, as well as combine  certain  product lines.  This Program called
for the consolidation of certain sales and marketing,  research and development,
manufacturing, finance and management information systems functions.

During fiscal 1996, the Company commenced significant  organizational and office
consolidations including closing the Cerritos,  Providence,  Commack and Calgary
offices. Most U.S. sales, marketing and research and development operations were
consolidated in San Jose,  California and all corporate functions in Scottsdale,
Arizona. Substantially all of the Canadian operations were consolidated into one
facility in Granby, Quebec. Included in the first quarter of fiscal 1997 pre-tax
income are $1.4 million of consolidation costs related to the program, including
facility  closing  costs,  severance  benefits and  relocation  expenses.  These
consolidation  activities  are  substantially  completed and should be finalized
during the second quarter of fiscal 1997.

The  following  table sets forth the details of activity  during fiscal 1997 for
consolidation costs:


<TABLE>
<CAPTION>
(in thousands)                                          Accrual at      Consolidation       Cash          Accrual at
                                                          June 29,          Costs         Payments      September 28,
                                                           1996                                             1996
                                                     --------------------------------------------------------------------
<S>                                                      <C>             <C>             <C>           <C>
Lease payments and other facility expenses               $     942       $    157        $  (510)      $        589
Severance and other related benefits                         2,832            408         (1,636)             1,604
Relocation and other                                         1,383            793         (1,530)               646
                                                     --------------------------------------------------------------------
    Total                                                $   5,157       $  1,358        $(3,676)      $      2,839
                                                     ====================================================================
</TABLE>
                                       10
<PAGE>
                                     Item 2.
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

FINANCIAL POSITION AND LIQUIDITY

The Company's current ratio increased to 5.8 to 1 at September 28, 1996 from 5.4
to 1 at June 29, 1996. Cash and current marketable securities decreased to $30.1
million at September 28, 1996 from $31.1  million at June 29, 1996.  The decline
relates to an $8.1 million  reduction in the revolving  credit facility and $2.2
million of capital expenditures, offset by cash provided by operations.

Accounts  receivable at September 28, 1996 declined  $15.2 million from June 29,
1996,  due to the  collection of  receivables  in the normal course of business.
Inventories  increased  $1.9  million in fiscal 1997  compared to the balance at
June 29, 1996. The increase is attributed to the normal  business cycle in which
inventory  is built up in the  first  half of the  fiscal  year in order to meet
increased sales demands in the second half of the fiscal year.

In February  1996,  the Company  entered  into a $100.0  million  multicurrency,
revolving line of credit (the "Revolving  Credit") with a syndicated bank group.
This facility  replaces prior revolving credit  facilities that were used by the
Company's  North  American  operations.  At September 28, 1996, a total of $27.1
million was outstanding under the credit facility.

The Revolving Credit,  which expires in December 1999, provides the Company with
several  interest  rate  options,  including  U.S.  prime,  LIBOR plus a margin,
Canadian prime plus the applicable  LIBOR margin less 0.50%,  Canadian  banker's
acceptance plus the LIBOR margin plus 0.125%, and short-term fixed rates offered
by the agent bank in the loan  syndication.  The LIBOR margin is currently 1.25%
per annum,  but it can range between 0.75% and 1.50%  depending on the Company's
interest coverage ratio.  Under the Revolving Credit, the Company is required to
pay a quarterly  commitment  fee on the unused portion of the facility at a rate
that ranges from 0.15% to 0.30% per annum.  At September  28, 1996 the quarterly
commitment fee was 0.25% per annum.

The Revolving Credit contains certain financial covenants,  the most restrictive
of which are a minimum interest  coverage ratio, a maximum funded debt ratio and
a minimum  consolidated  tangible net worth amount.  It also contains  covenants
that  restrict  the  amount of cash  dividends  as well as the  amount  that the
Company can repurchase of its subordinated debt and common stock.

In  August  1996,  the  Company  amended  the  Revolving  Credit to grant to the
syndicated  bank group a  security  interest  in U.S.  accounts  receivable  and
inventories.  The security  interest is subject to automatic release by the bank
group upon the achievement of certain  financial ratios after September 1, 1997.
The amendment, among other things, waived the interest coverage covenant default
as of June 29, 1996.

Capital expenditures were $2.2 million for the first quarter of fiscal 1997. The
Company  expects  to  spend  approximately  $5.0  to  $6.0  million  on  capital
expenditures  in fiscal year 1997.  The  largest  planned  expenditures  are for
computer systems and new product tooling.

A principal business strategy of the Company has been to pursue  acquisitions of
businesses,  products or technologies that will complement its current business.
The Company has identified the bicycle and sporting goods industries as possible
areas of focus.  Such  acquisitions  may be funded  with  available  cash,  debt
financing, issuance of common stock or a combination thereof.

The Company  believes its available cash flows from operations and the Revolving
Credit should be adequate to satisfy its working capital  requirements in fiscal
1997.  The Company does not anticipate  paying  dividends on its Common Stock in
the foreseeable future.
                                       11
<PAGE>
Certain matters  contained  herein are  forward-looking  statements that involve
risks and  uncertainties  that could cause actual  results to differ  materially
from those in the forward-looking statements. These include, but are not limited
to:  seasonality,  competitive  actions,  timing  of major  customer  shipments,
adverse weather conditions, retail environment, economic conditions and currency
fluctuations.


RESULTS OF OPERATIONS

         Net Sales.  Net sales increased by 8% to $62.1 million during the three
months ended September 28, 1996 as compared to $57.7 million for the same period
in  1995.  The  increase  is due to  strong  helmet  and  bicycle  sales  in the
Independent  Bicycle  Dealer  channel,  compared  to prior year.  Helmets  sales
increased by 16.7%  mainly due to the  inclusion of Giro in the current year and
increases  in the Bell Pro  Series  brand.  Giro  contributed  $3.5  million  of
incremental sales for the fiscal quarter ended September 28, 1996. Bicycle sales
increased  by  18.4%  due to  strong  sales on old  model  year  close  outs and
pre-season shipments on new models.


The product line sales mix for the three month period is as follows:

                                              Three Months Ended
                                              ------------------

                                        September 28,        September 30,
Product Line Sales Mix:                     1996                 1995
                                            ----                 ----
     Bicycle accessories                     54%                  58%
     Bicycle helmets                         28%                  26%
     Bicycles                                16%                  15%
     Auto Racing helmets                      2%                   1%




The  Company  expects  sales to also be  higher  in the  second  fiscal  quarter
compared to a year ago due to incremental sales from Giro.

         Gross Margin.  Gross margins remained consistent at 28% of net sales in
the first quarter of fiscal 1997,  when  compared to fiscal 1996,  excluding the
impact of the inventory  write-up in fiscal 1996. Helmet margins improved during
the  quarter  due to the  addition  of Giro and the strong  quarter for the Bell
brand,  offset by a decline in bicycle margins due to greater discounting on end
of season close outs.

The inventory write-up of $5.9 million,  related to the merger with AMRE and the
acquisition of SportRack,  was charged to cost of sales during the first quarter
of fiscal 1996.

         Selling,    General   and   Administrative.    Selling,   general   and
administrative  costs  remained  consistent at 25% of net sales when compared to
the fiscal 1996 three month period.  Actual selling,  general and administrative
costs increased 5% to $15.3 million in the first three months of fiscal 1997 due
to the  inclusion  of Giro in fiscal 1997,  which was acquired in January  1996.
When adjusting for the impact of Giro in fiscal year 1997, selling,  general and
administrative expenses declined $660,000 when compared to fiscal 1996.

As a result of the timing of the  Company's  spring  selling  season,  sales are
normally  higher in the  second  half of the  fiscal  year than the first  half.
Although some  selling,  general and  administrative  expenses are variable with
sales, most expenses are incurred evenly throughout the year.
                                       12
<PAGE>
         Amortization  of  intangibles.  Amortization of goodwill and intangible
assets  increased to $862,000 in the first  quarter of fiscal 1997 from $587,000
in the first quarter of fiscal 1996, primarily due to the acquisition of Giro in
January 1996.

         Consolidation   Costs.   During  fiscal  1996,  the  Company  commenced
significant  organizational  and office  consolidations  including  closing  the
Cerritos,  Providence,  Commack and Calgary offices. Most U.S. sales,  marketing
and  research  and  development   operations  were  consolidated  in  San  Jose,
California and all corporate functions in Scottsdale, Arizona. Substantially all
of the  Canadian  operations  were  consolidated  into one  facility  in Granby,
Quebec.  Included  in the first  quarter of fiscal 1997  pre-tax  income is $1.4
million  related to  consolidation  costs,  including  facility  closing  costs,
severance benefits and relocation expenses.  These consolidation  activities are
substantially  completed  and should be finalized  during the second  quarter of
fiscal 1997.

         Net  investment  income and interest  expense.  Net  investment  income
increased to $1.8 million for the first three months in fiscal 1997, compared to
$1.0 million in fiscal 1996. The increase is due to settlement of an arbitration
case  related to the  handling of certain  marketable  securities  by an outside
investment  advisor.  The  settlement  proceeds,  net of  related  expenses  and
expected losses to sell certain securities,  of $1.3 million are included in net
investment  income.  Interest  expense  decreased  to $1.8  million in the first
quarter of fiscal 1997 from $2.3  million in the first  quarter of fiscal  1996,
due to lower levels of debt outstanding during fiscal 1997.

         Income taxes. The effective tax rate was 44.0% for the first quarter of
fiscal 1997.  The effective rate was 47.0% for the first quarter of fiscal 1996,
excluding  consolidation  costs and the impact of the  inventory  write-up,  and
20.0% if these cost are included.

         Net income and weighted average shares. Results from operations for the
fiscal  1997 first  quarter  was income of $3,000 or  break-even  on a per share
basis  compared  to a loss of $5.4  million or 38 cents per share for the fiscal
1996 first quarter.  First quarter results included pretax consolidation charges
of $1.4 million and $400,000 in fiscal 1997 and fiscal  1996,  respectively.  In
addition,  the  fiscal  1996  results  included  a $5.9  million  charge for the
inventory write-up arising from the acquisition of SportRack in May 1995 and the
merger with American  Recreation Company Holdings,  Inc. in July 1995.  Weighted
average shares outstanding for the fiscal three month period ended September 28,
1996 was 13.7 million compared to 14.1 million at September 30, 1995,  primarily
due to the Company's  repurchase  of 523,400  shares of its  outstanding  Common
Stock during fiscal 1996.
                                       13
<PAGE>
                                BELL SPORTS CORP.

                                     PART II




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

                           (a)      Exhibit Index                        Page 16

                           (b)      None
                                       14
<PAGE>
                                   SIGNATURES



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

Date:    October 30, 1996


                                BELL SPORTS CORP.




  /s/  Howard A. Kosick     Executive Vice President and Chief Financial Officer
-------------------------   (Principal financial officer)
       Howard A. Kosick     


  /s/  Linda K. Bounds      Vice President and Corporate Controller
-------------------------   (Principal accounting officer)
       Linda K. Bounds      
                                       15
<PAGE>
                                BELL SPORTS CORP.
                                INDEX TO EXHIBITS


Exhibit
Number            Description
--------------------------------------------------------------------------------

11*              .Statement re: computation of per share earnings


27*              .Financial Data Schedule














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

* Filed herewith
                                       16