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                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-K
(Mark One)

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

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

For the year ended December 31, 1998                 Commission File No. 0-12361
                        
                       Richton International Corporation
             (Exact name of registrant as specified in its charter)

           Delaware                                              05-0122205
(State or other jurisdiction of                               (I.R.S. Employer
 incorporation or organization)                              Identification No.)

 767 Fifth Avenue, New York, New York                              10153
(Address of principal executive offices)                         (Zip Code)

Issuer's telephone number.........................................(212) 751-1445

   Securities registered under             Name of Exchange on which Registered:
Section 12(b) of the Exchange Act:

   Common Stock, par value $.10                   American Stock Exchange

         Securities registered under Section 12(g) of the Exchange Act:

            Series A Preferred Stock, par value $1.00. Purchase Right

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),  and  (2) has  been  subject  to such  filing
requirements  for the  past 90  dates.  Yes ___  No  

Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 405
of Regulation  S-K is not contained  herein,  and will not be contained,  to the
best of registrant's  knowledge,  in definitive proxy or information  statements
incorporated  by reference in Part II of this Form 10-K or any amendment to this
Form 10-K. [ ]

State the aggregate market value of the voting stock held by  non-affiliates  of
the Registrant.

        Aggregate market value at March 1, 1999 amounted to $14,782,000

Indicate the number of shares outstanding of each of the Registrant's classes of
Common Stock, as of the latest  practicable  date. 

        Common Stock, par value $.10, 2,951,000 shares at March 1, 1999

                       DOCUMENTS INCORPORATED BY REFERENCE

Portions of the annual  shareholders report for the year ended December 31, 1998
are incorporated by reference into Parts I and II.

Portions of the proxy statement for the annual  shareholders  meeting to be held
May 3, 1999 are incorporated by reference into Part III.

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<PAGE>

                                     PART I

Item 1. Business

      Richton  International  Corporation  (the  "Company"  or  "Richton")  is a
diversified  service  company with two operating  subsidiaries,  Century  Supply
Corp. ("Century") and CBE Technologies, Inc. ("CBE").

      Century  is a leading  full-service  wholesale  distributor  of  sprinkler
irrigation   systems,   outdoor  lighting  and  decorative  fountain  equipment,
headquartered in Madison Heights,  Michigan.  Its branches serve customers in 33
States  mostly in the eastern  half of the country and Ontario,  Canada.  During
1998,  Century acquired several  distributors in Utah, Idaho and opened a branch
in Oregon.  Irrigation  products have  historically  been sold by  manufacturers
primarily through wholesale distributors and Century is a leading distributor of
irrigation  equipment in the geographic areas it serves.  Century is currently a
distributor  for the  leading  original  equipment  manufacturers  (OEM) of turf
irrigation equipment in the United States.

      Century's primary  customers are irrigation and landscape  contractors who
install irrigation systems for commercial,  residential and golf course watering
systems.  Approximately  93% of revenues are derived from  irrigation  products,
with the remaining 7% from lighting and fountains.  Century represents more than
60  suppliers  and  provides a complete  product  line to  approximately  15,300
customers through more than 100 branches.

      Century is organized into six geographical  regions,  each with a regional
team that  manages  branches  within a  specific  geographic  area.  Purchasing,
accounts receivable,  accounting and cash management are centralized  functions.
Close control is maintained  over  receivables,  inventory and other key factors
through a centralized order entry management  information  system.  All branches
are linked to the on-line system, and substantially all of Century's business is
conducted in a real time order entry environment.

      Century's operations  constitute a material portion of Richton's business.
Although Century has a history of operating profitably, its business is impacted
by both the economic and climatic  conditions in the geographic  areas where its
branches are located.  Since irrigation and landscape  contractors are Century's
primary customers, business is best when commercial and residential construction
is strong and general economic conditions and consumer confidence are favorable.
Weather  is also a  significant  non-controllable  element  affecting  Century's
business.  Business is better during warm dry periods,  especially in spring and
early summer months and when general  construction is strong.  Climatic  factors
that can adversely affect Century  principally relate to above-average  rainfall
during the primary selling season or other unusual  weather-related  conditions.
Century's  geographic  diversity makes it much less  susceptible to weather than
many of its competitors who operate in a more limited  geographic area.  Century
has  mitigated  some of the impact of both  economic and climatic  conditions by
pursuing an aggressive  growth  program.  By opening or acquiring  branches (see
Competition)  in new areas  and  continuing  to grow its  business  in  existing
markets,  Century has created both geographic  diversity and consistent  growth.
Even so,  seasonality  causes a  significant  disparity in  quarterly  sales and
results.

      CBE headquartered in Boston,  Massachusetts  with offices in New York, Los
Angeles  and  Portland,   Maine  is  a  systems  integrator   providing  network
consulting,  design,  and installation;  network management and related support;
technical  services  outsourcing;   comprehensive   hardware  maintenance;   and
equipment sales.

      CBE's  technical   certifications   include:   Novell  Platinum  reseller,
Microsoft Channel partner, Cisco Premier,  Novell Authorized Training Center, as
well as a Novell Authorized Service Center.

      Physical   resources  include  a  fully  integrated  network  lab  with  a
functioning model of most computer  operating  systems; a network management lab
to support remote management;  and training labs at both the Boston and Portland
sites to support in-house training programs.

      CBE is also an  authorized  service  and  warranty  center for most of the
leading Personal Computer ("PC")  manufacturers  including IBM, Compaq,  Hewlett
Packard,  Apple, AST, and services most every other make of PC and printers. The
field staff is supported by a fully automated call control and dispatch  center;
a parts depot with an extensive inventory; and a complete  diagnostic/repair lab
for PC's, printers and monitors.

      CBE's business is impacted by  technological  changes both in software and
hardware.  There can be no  assurance  that CBE can (a) continue to maintain the
highly qualified and experienced  technicians and engineers,  and (b) that those
technicians continue to remain technically proficient in an environment in which
technology changes occur regularly.


                                       1
<PAGE>

Suppliers

      Century  maintains a broad base of  suppliers  that enables the Company to
offer a wide range of irrigation equipment. Products are obtained from more than
60 suppliers  with no one supplier  comprising  more than 30% of average  annual
purchases.  Century has master  distributor  agreements in place with Rain Bird,
Hunter,  Irritrol  Systems  and Legacy by Hunter  Golf as well as with other OEM
suppliers that authorize Century as a distributor of their products for specific
geographic  areas.  These  agreements  are renewable  annually,  and there is no
assurance that these agreements will be renewed.  Therefore,  Century's business
is subject to change in these  distribution  agreements with manufacturers or in
manufacturers  pursuing  alternate  channels of distribution.  However,  Century
maintains  excellent  vendor  relations  with  these  suppliers  and  management
believes the  wholesale  distribution  channel will  continue to be the dominant
professional channel for the irrigation industry.

      CBE acquires its products  from OEM suppliers as well as  wholesalers  and
distributors,  such as Tech Data  Corporation,  Ingrim  Micro,  and Gates  Arrow
Electronics.


Competition

      Historically,  irrigation  distribution,  like the wholesale  distribution
industry  in  general,  has been  fragmented  with many  small  distributorships
serving  specific  geographic  markets.   However,  the  more  recent  trend  in
distribution has been one of consolidation,  where larger wholesaler chains have
been created as a result of mergers and  acquisitions  and  distributors  moving
into new  territories  to expand  market  share and achieve  economies of scale.
Within the  irrigation  industry,  Century has been a leader in the trend toward
consolidation.

      During the period of Richton ownership, Century has grown from 29 branches
and $43  million in sales in 1993 to more than 94 branches  and $125  million in
sales in 1998. Since Century has a sophisticated  computer system supporting its
branch  operations  and most of its  administrative  functions are  centralized,
Century has been able to achieve  significant  economies of scale as a result of
consolidation and growth.

      This growth has resulted in Century facing different competitors in almost
every  market it serves.  Century  competes  with these  other  distributors  by
providing local warehousing linked to a centralized computer system that enables
Century customers to get product when they need it, and by providing value-added
services, such as design assistance,  training seminars,  incentive programs and
sales leads to its  customers.  Century also  competes  against  large  discount
stores and plumbing supply companies that sell irrigation products, which may be
at lower  prices,  but who do not  provide the range of  services  that  Century
offers.  While some of its  competitors in specific  markets are larger than the
corresponding Century operations, it is management's belief that none are larger
when only the irrigation business is considered.

      CBE competes in maintenance  service with many companies,  both larger and
smaller than CBE. Larger companies generally are OEM suppliers that also provide
network  installation  and  maintenance  services  and offer a  broader  line of
product and service than CBE.

Employee Relations

      At December 31, 1998,  the Company  employed  approximately  585 full-time
employees.  None of these  employees  are  covered  by a  collective  bargaining
agreement.

      The  Company  considers  its people to be one of its  greatest  assets and
provides  training courses on sales,  product features and benefits,  management
skills,  and  communication.  This has created an effective,  knowledgeable  and
self-motivated work force with a strong focus on customer service.

Working Capital

      Century's business is seasonal due principally to the fact that irrigation
systems are normally  installed  during warm weather and a majority of Century's
branches are located in the  northern  half of the United  States.  As a result,
Century's  monthly and quarterly  sales,  operating  results and working capital
requirements fluctuate significantly.  Century relies on short-term borrowing to
finance its working capital needs.  During the first quarter,  Century's working
capital requirements are at minimum, with short-term borrowings of approximately
$25 million,  a  significant  increase from prior years due  principally  to the
added branch operations.  Beginning in April borrowing  requirements  expand. By
July short-term  borrowings will increase to approximately  $40 million.  During
the 


                                       2
<PAGE>

remaining  months  receivable  balances are  liquidated,  releasing  substantial
amounts of cash that may be used to reduce short-term borrowing.  (See Note 7 of
Notes to  Consolidated  Financial  Statements for a description of the Company's
credit line.)

      At December 31, 1998 working capital  decreased  approximately $.8 million
to $6.5 million from $7.3 million in the prior year. This decline was attributed
primarily  to added  debt  associated  with  the  acquisitions  and the  related
goodwill,  net of  amortization,  of $1.4 million in 1998. In 1997  acquisitions
were nearly all funded  internally and the comparable  amount was $.6 million in
net goodwill charges.

Business Acquisitions

      On March 29,  1995 the  Company,  through  its  wholly  owned  subsidiary,
Century, acquired all the operating assets and business of CBE for $5.0 million,
plus assumption of certain liabilities, which was financed by bank borrowings of
$3.0 million, a $1.0 million unsecured  promissory note to the former owners and
a $1.0  million  note to the  Chairman of Richton.  The note to the Chairman was
subject to a fairness  opinion of an  independent  advisor  chosen by  Richton's
Board of Directors.  The note to the former owners,  which is guaranteed by both
Century and Richton, is to be paid over the next two years.

      During 1998 Century acquired five different distributor operations in four
different  markets.  Northern  New  Jersey,  Idaho,  Utah and  Florida  for $6.4
million.  The  acquisitions  were made for cash and were financed by its working
capital line, recording $4.2 million in tangible net assets. Century also opened
a branch in Oregon as well as fourteen new branches in existing markets. Similar
to past experience,  several of these acquisitions were made primarily after the
prime selling season.

Liquidity

      The Company's financial  condition continues to improve.  The net worth as
of December 31, 1998 has increased to $11.9  million.  At December 31, 1998, the
Company's long-term debt was approximately $6.5 million,  including $4.5 million
of  senior  secured  debt  owed  to a  Michigan  bank.  Of  the  balance  of the
outstanding  debt, $0.7 million is owed to Fred R. Sullivan,  Chairman and Chief
Executive Officer of Richton, which is payable through April, 2000. Notes issued
to Mr.  Sullivan  were subject to a fairness  opinion  issued by an  independent
advisor  chosen by Richton's  Board of  Directors.  The bank debt provides for a
loan covenant that precludes distribution of funds to stockholders.

      Though the Company has continued to generate  sufficient cash to liquidate
its  term  and  subordinated  debt as it  becomes  due,  and  make  acquisitions
necessary  for it's  growth,  there is no  assurance,  given the high  degree of
leverage, the seasonality of its principal business, and the strong construction
economy that existed in 1998, that it can continue to do so in the future.

ITEM 2. Properties

      Richton's  executive  offices at 767 Fifth Avenue,  New York, New York are
subject to a five-year lease which expires in 2003.  Century's principal offices
are in Madison Heights, Michigan, under a lease that expires in October 2000. In
addition,  Century leases  warehouse and sales space in its other branches.  The
aggregate of such leased space is approximately  377,000 square feet. Expiration
dates extend to July 2006.  Seven of these facilities are leased from the former
owner of Century under a lease  agreement,  which  approximates  current  market
value.  These  leases  expire in October  2000.  One  facility  is leased from a
partnership,  which  includes  the  President  of Century.  The lease,  which is
currently on an annual basis,  approximates  current market value.  In addition,
during 1997 Century acquired a 10,000 square foot facility in Sarasota, Florida,
which it had previously leased. In 1998 Century acquired a 3000-sq. ft. facility
in Bay City, MI which it had  previously  leased.  CBE's  principal  offices are
located in Boston,  Massachusetts.  This  office is leased  under an  agreement,
which  expires in June 2000.  CBE leases  approximately  10,000  square  feet of
additional  office  space at its  other  locations.  Richton  believes  that its
properties  are  adequately  equipped,  maintained and suited to the purpose for
which they are used.

ITEM 3. Legal Proceedings

      None.


                                       3
<PAGE>

ITEM 4. Submission of Matters to a Vote of Security Holders

      No matter was  submitted to a vote of security  holders  during the fourth
quarter of fiscal 1998.

                      EXECUTIVE OFFICERS OF THE REGISTRANT

      For the information about the executive officers of Richton required to be
included  in this Part I, see  "Executive  Officers  of  Registrant  in Part III
below, which is incorporated into Part I by reference.


                                       4
<PAGE>

                                     PART II

ITEM 5. Market for Registrant's Common Equity and Related Stockholder Matters

      (a) Market information:

      The Company's Common Stock trades on the American Stock Exchange under the
symbol "RHT".  The following  table sets forth the high and low sales prices for
the Common Stock.  The  quotations  shown are as reported by the American  Stock
Exchange.

                                         1998                       1997
                                    ---------------          -----------------
          Calendar Quarter          High       Low           High         Low
         -----------------          -----     -----          -----        ----
First .........................   $ 6 15/16   $5 5/8         $4 3/4     $4 1/8
Second ........................    10 1/4      6 1/2          4 9/16     3 3/4
Third .........................    11 1/8      7 7/8          5 1/2      4 1/2
Fourth ........................     9 1/8      7 1/2          7 3/16     5 1/16

      (b) Approximate Number of Equity Stockholders:

                                                          Approximate Number
                                                           of Record Holders
                 Title of Class                          at February 28, 1999
                 -------------                          --------------------
          Common Stock, $ .10 par value                           524

      (c) Dividends:

      The Company paid no cash  dividends  in 1998,  1997 or 1996 as noted under
"Liquidity" the Company's  financing  arrangements  preclude the distribution of
dividends.

ITEM 6. Selected Consolidated Financial Data

      The  following  data has been  derived  from  the  Consolidated  Financial
Statements  of the  Company  and  should  be  read  in  conjunction  with  those
statements, and the notes related thereto, which are included in this report.

                              SUMMARY OF OPERATIONS
            (In thousands, except percentages and per share amounts)

<TABLE>
<CAPTION>
                                                                    December 31
                                      -----------------------------------------------------------------
                                         1998            1997          1996        1995         1994
                                      ----------      ----------    ----------   --------     ---------
<S>                                    <C>              <C>           <C>          <C>          <C>    
Net Sales ..........................   $147,899         $106,523      $87,750      $66,659      $50,306
Gross Profit percentage ............         28%              28%          28%          28%          28%
Income from Operations .............      7,582            5,505        3,832        3,466        2,702
Interest expense, net ..............      1,604            1,334        1,216        1,092          817
Net Income .........................      3,532            2,290        1,766        1,365        1,004
Net Income per diluted share .......   $   1.06         $    .68      $  0.54      $  0.43      $  0.34
</TABLE>

                               FINANCIAL POSITION
                          (In thousands, except ratios)
<TABLE>
<CAPTION>
                                                                 December 31
                                     ----------------------------------------------------------------
                                       1998            1997          1996       1995(a)       1994
                                      -------         ------        ------     --------      -------
<S>                                    <C>              <C>          <C>          <C>          <C>   
Total Assets ......................    57,493           41,632       32,374       26,114       15,801
Long-term Debt ....................     4,639            5,591        6,986        7,150        3,834
Working Capital ...................     6,535            7,372        5,610        3,029        2,341
Current ratio ..................... 1.16 to 1        1.27 to 1    1.31 to 1    1.22 to 1    1.28 to 1
</TABLE>


                                       5
<PAGE>

      Notes to Selected Financial Data:

      Note (a) --The Registrant acquired CBE effective March 29, 1995


ITEM 7. Management's  Discussion and Analysis of Financial Condition and Results
        of Operations

      The  following  information  should be read  along  with the  Consolidated
Financial Statements and Notes thereto on pages F-2 through F-13.

      This report contains forward-looking  statements. The matters expressed in
such  statements are subject to numerous  uncertainties  and risks including but
not limited to general economic and climatic  conditions in the markets in which
Richton and its subsidiaries operate, fluctuation in demand for the products and
services offered by these subsidiaries,  and current expectations of the Company
or  its  management.  Should  one  or  more  of  those  uncertainties  or  risks
materialize,  or should  the  underlying  assumptions  prove  incorrect,  actual
results may vary materially from those described as forward-looking  statements.
The Company does not intend to update those forward-looking statements.

RESULTS OF OPERATIONS

1998 Compared with 1997

      Sales for the year  ended  December  31,  1998  were  $147.9  million,  an
increase of $41.4 million or approximately  38.9% over the 1997 amount of $106.5
million.  Century  contributed  $38.2  million of this  increase  due largely to
favorable  economic  and weather  conditions  in most of its market areas and to
geographical  expansion  relating to acquisitions  made in the fourth quarter of
1997.  Presently,  Century has more than 100 branches.  CBE's sales in 1998 have
increased more than 16.0% over 1997 levels principally due to market growth.

      Gross profit for the year ended  December 31, 1998 was $40.8  million,  an
increase of $10.6 million or  approximately  35.1% over the 1997 amount of $30.2
million.  This  increase is due  primarily to the higher sales noted above.  The
overall gross profit  percentage of sales declined slightly to 27.6% due in part
to the overall competitive conditions in the irrigation market.

      Selling,  general and administrative  expenses for the year ended December
31, 1998  increased  $8.5 million or 34.4% of sales to $33.2  million from $24.7
million  for the year  ended  December  31,  1997.  The full year  effect of the
geographical  expansion  resulting from acquisitions made during 1997 at Century
noted above accounted for a major portion of this increase.

      Interest  expense,  net for the year ended December 31, 1998 increased $.3
million to $1.6 million.  This increase reflects the higher borrowings under the
line of credit facility incurred in carrying the higher working capital.

      The federal,  state and foreign  income tax  provision  for the year ended
December 31, 1998 was $2.4  million,  an increase of  approximately  $.6 million
from last year. The higher taxes are due to higher income.

      As a result of the  foregoing,  net income for the year ended December 31,
1998 was $3.53  million,  or $1.06 per  share-diluted.  This compares with $2.29
million or $.68 per share-diluted reported for the year ended December 31, 1997.

1997 Compared with 1996

      Sales for the year  ended  December  31,  1997  were  $106.5  million,  an
increase  of $18.7  million or  approximately  21% over the 1996 amount of $87.8
million.  Century  contributed  $13  million  of this  increase  due  largely to
favorable  economic and weather  conditions  in most of it's market areas and to
geographical  expansion-principally  in the East and South East  sections of the
country.  In 1997,  Century had 65 branches.  CBE's sales in 1997 have increased
more  that 40%  over  1996  levels  principally  due to  expansion  through  the
acquisition made a year ago in Maine and in Los Angeles, California.

      Gross  profit for the year ended  December  31, 1997 was $30.2  million an
increase  of $5.4  million or  approximately  22% over the 1996  amount of $24.8
million.  This  increase is due  primarily to the higher sales noted above.  The
overall gross profit percentage of sales remained about 28.3%.


                                       6
<PAGE>

      Selling,  general and administration  expenses for the year ended December
31, 1997 increased $3.8 million or 18.1% to $24.7 million from $20.9 million for
the year ended  December  31,  1996.  The full year  effect of the  geographical
expansion noted above accounted for a portion of this increase.

      Interest  expense,  net for the year ended December 31, 1997 increased $.1
million  or nearly  10% to $1.3  million  over the year  earlier  period of $1.2
million.  This increase  reflects the higher borrowings under the line of credit
facility incurred in carrying the higher working capital,  partially offset by a
slightly lower borrowing rate.

      The federal,  state and foreign  income tax  provision  for the year ended
December 31, 1997 was $1.9 million,  a increase of  approximately  $%1.0 million
from last year. The higher tax is principally due to higher income.

      As a result of the  foregoing,  net income for the year ended December 31,
1997 was $2.29  million,  or $.68 per  share-diluted.  This  compares with $1.77
million or $.54 per share-diluted reported for the year ended December 31, 1996.

Liquidity and Capital Resources

      The Company's financial  condition continues to improve.  The net worth as
of December 31, 1998 has increased to $11.9  million.  The  Company's  long term
debt -- including the current position -- at December 31, 1998 was $6.5 million,
a decrease of $.9 million from December 31, 1997.

      The Company  continues  to rely on  short-term  borrowings  to finance its
working  capital.  During  the first  quarter of each  year,  Century's  working
capital  requirements  are at a low point,  with short-term  borrowings of $25.0
million a significant  increase from prior year due  principally to the increase
in the number of  branches  and  markets  served by  Century.  During the second
quarter  working capital  requirements  begin to expand and by July of each year
the amount necessary to carry the working capital expands to approximately $40.0
million.  From July through the remainder of the year,  receivable  balances are
liquidated,  releasing  substantial  amounts  of cash that may be used to reduce
short-term debt. The operating  profits before interest and taxes of the Company
improved to $7.5 million from $5.5 million last year.  The Company was thus able
to retire nearly $.9 million of term and subordinated debt which came due during
the year and partially  fund $6.4 million on  acquisitions  of businesses in new
markets.  At December 31, 1998 working  capital was $6.5 million,  a decrease of
approximately $.7 million from last year. This decline was partially  attributed
to the higher debt associated with the acquisitions and the related  intangibles
costs which in 1998  amounted to a net increase of $1.4 million as compared to a
net increase of $.6 million in 1997 when,  due to the lower level of acquisition
expenditure,  funding was internally  provided.  It is expected that the Company
will continue to rely on  short-term  borrowings to fund its future growth which
will increase the Company's  leverage.  However,  because the Company expects to
continue  to reinvest  its  available  funds,  the amount of debt will grow at a
slower rate than the growth in assets.

      While the Company has continued to generate  sufficient  cash to liquidate
its  term  and  subordinated  debt as it  becomes  due,  and  make  acquisitions
necessary  for its  growth,  there is no  assurance,  given  the high  degree of
financing  leverage,  the potential for continued  growth in this leverage,  the
seasonality of its principal business,  and the strong construction economy that
it can continue to do so in the future.

Year 2000

      The year 2000 issue exists because many computer systems and applications,
including those imbedded in equipment and facilities,  use two digit rather than
four digit date fields to designate an applicable year. As a result, the systems
and applications may not properly  recognize the year 2000 or process data which
includes  it,  potentially  causing  data  miscalculations  or  inaccuracies  or
operational malfunctions or failures.

      Each  of  the  Company's  operating  subsidiaries  uses  systems  software
acquired  from an  established  software  vendor.  In each case the  vendor  has
indicated that the software being supplied is year 2000  compliant.  In the case
of Century,  their operating computer environment uses a proxy for a date rather
than the actual  date -thus  there is no double  zero  problem to deal with that
would be subject to  misinterpretations  or  miscalculation.  CBE has received a
"Y2K Compliance Certificate" from American Micro Innovations, Inc. the vendor of
their general ledger systems and its supporting modules.  Despite the assurance,
the Company will test these systems during the 3rd quarter of 1999.

      Both  Century  and CBE  communicate  with  their  suppliers  through  EDI.
Century,  however,  does not  receive  its third  party data  directly  into its
operating  systems  but rather it  converts  such data  before it is  internally
processed,  avoiding the  opportunity  for  contamination  of their system.  CBE
recently tested their EDI transmission with several


                                       7
<PAGE>

of their largest  vendors and found the systems  compliant.  Century and CBE are
continuing to work with their  suppliers,  however should any supplier or vendor
be unable to achieve year 2000  compliance  by September  30, 1999,  the Company
intends  to  switch  to  other  suppliers  that are able to  provide  year  2000
compliance. The Company does not expect to incur any material additional cost to
achieve year 2000 compliance.

      The Company's ability to be completely compliant is, of course,  dependant
upon the ability of its vendors,  suppliers,  bankers and other  fiduciaries  to
also be compliant. In addition, the Company can not guarantee that third parties
upon whom the Company depend for essential services, such as electric utilities,
and  telephone  and other  interchange  carriers,  will convert  their  critical
systems  and  processes  in a timely  manner.  Failure  or delay by any of these
parties could disrupt the Company's  businesses.  The Company has  established a
supplier compliance program to minimize such risks.


ITEM 7a. Quantitative & Qualitative Disclosures about Market Risk

      The Company's market risk sensitive instruments do not subject the Company
to material market risk exposures.


ITEM 8. Financial Statements

      The financial statements required by this Item, are set forth below:

                                                                           Page
                           Description                                    Number
                           -----------                                   -------
Report of Independent Public Accountants ..............................    F-1
Consolidated Balance Sheets at December 31, 1998
   and December 31, 1997 ..............................................    F-2
Consolidated Statements of Income for the three years ended
   December 31, 1998 ..................................................    F-3
Consolidated Statements of Stockholders' Equity for the 
   three years ended December 31, 1998 ................................    F-4
Consolidated Statements of Cash Flows for the three years ended
   December 31, 1998 ..................................................    F-5
Notes to Consolidated Financial Statements ............................    F-6

Richton International Corporation

      Quarterly analysis of sales, operating margin, net income and earnings per
share

<TABLE>
<CAPTION>
                                             Gross           Pre-tax             Net          Earning
                          Sales             Profit $       Profit (Loss)     Income (Loss)   Per Share
                          -----            ---------       -------------     -------------   ---------
<S>         <C>         <C>                <C>             <C>               <C>                <C>   
1st Qtr.    1998        16,955,000         4,313,000       (1,955,000)       (1,184,000)        (0.35)
            1997        14,081,000         3,692,000       (1,780,000)       (1,071,000)        (0.33)

2nd Qtr.    1998        50,274,000        14,101,000        4,979,000         3,000,000          0.89
            1997        35,932,000        10,444,000        3,408,000         2,070,000          0.63

3rd Qtr.    1998        48,241,000        13,519,000        2,907,000         1,747,000          0.53
            1997        35,145,000        10,143,000        2,386,000         1,370,000          0.41

4th Qtr.    1998        32,429,000         8,828,000           47,000           (31,000)        (0.01)
            1997        21,365,000         5,910,000          157,000           (79,000)        (0.02)
                        ----------         ---------        ---------         ---------          ----
Year        1998       147,899,000        40,761,000        5,978,000         3,532,000          1.06
            1997       106,523,000        30,189,000        4,171,000         2,290,000          0.68
</TABLE>

ITEM  9.  Changes  in and  Disagreements  with  Accountants  on  Accounting  and
Financial Disclosure

      None


                                       8
<PAGE>

                                    PART III

ITEM 10. Directors and Executive Officers of Registrant

      Identification of the executive officers:

                                                                       Officer 
        Name               Age     Positions and Offices                Since
        -----             ----      -------------------                --------
Fred R. Sullivan           84      Director, Chairman of the Board       1989
                                      & Chief Executive Officer
Cornelius F. Griffin       59      Vice President & Chief                1985
                                      Financial Officer
Marshall E. Bernstein      60      Secretary                             1985

      There is no family  relationship  among any of the executive  officers and
directors of the Company.  Each  executive  officer holds office for one year or
until a respective successor is chosen,  except that each officer may be removed
from office, with or without cause, at any time by the Board of Directors.

      The business experience of the executive officers is:

      Fred R. Sullivan-Director, Chairman of the Board & Chief Executive Officer
for more than five years.

      Cornelius F. Griffin -- Vice President & Chief Financial  Officer for more
than five years.

      Marshall E.  Bernstein-- For more than five years a Member of the law firm
of Robinson, Brog, Leinwand, Greene, Genovese & Gluck P.C. and predecessor.

ITEM 11. Executive Compensation

      The  information  required by Item 11 is  incorporated by reference to the
Company's  definitive  proxy  statement  to be  filed  with the  Securities  and
Exchange Commission not later than April 30, 1998.

ITEM 12. Security Ownership of Certain Beneficial Owners and Management

      The  information  required by Item 12 is  incorporated by reference to the
Company's  definitive  proxy  statement  to be  filed  with the  Securities  and
Exchange Commission not later than April 30, 1998.

ITEM 13. Certain Relationships and Related Transaction

      The  information  required by Item 13 is  incorporated by reference to the
Company's  definitive  proxy  statement  to be  filed  with the  Securities  and
Exchange Commission not later than April 30, 1998.

                                     PART IV

ITEM 14. Exhibits, Financial Statements and Reports on Form 8-K

      (a) (1) (2) The  list of  financial  statements  and  financial  statement
schedules by this item are included in Item 8 on page 8.

   (a)  Exhibits:

      (2) Exhibits

            2.1     --Stock  Purchase  Agreement  dated as of July 31,  1993 and
                      amendment  thereto  dated August 27, 1993 and among Ernest
                      Hodas as trustee of the Ernest Hodas Revocable  Trust, The
                      Hodas Family Limited  Partnership,  Ernest Hodas,  Century
                      Supply Corp., Century Acquisition  Corporation and Richton
                      International Corporation

                      Incorporated  by reference to Exhibit 2.1 to  Registrant's
                      Current   report  on  Form  8  for  January  5,  1994  
          
            2.2     --Agreement  for the Purchase of Assets dated March 29, 1995
                      by and among CBE Acquisition Corp., (the "Buyer"), Century
                      Supply Corp.,  Richton  International  Corporation and CBE
                      Technologies, Inc. (the "Seller")


                                       9
<PAGE>

                      Incorporated  by reference to Exhibit 2.1 to  Registrant's
                      Current report on Form 8-K for April 5, 1995

      (3) Exhibits

            3.1     --Certificate  of  Incorporation  of  Richton  International
                      Corporation  

                      Incorporated  by reference to Exhibit 99.1 to Registrant's
                      Annual Report on Form 10-K for the year ended December 31,
                      1995

            3.2     --Restated   Certificate   of   Incorporation   of   Richton
                      International  Corporation  

                      Incorporated  by reference to Exhibit 3.2 to  Registrant's
                      Annual Report on Form 10-K for the year ended December 31,
                      1997

            3.3      --By laws of Richton International Corporation

                      Incorporated  by reference to Exhibit 99.1 to Registrant's
                      Annual Report on Form 10-K for the year ended December 31,
                      1995

      (4) Exhibits

            4.1     --Stock Certificate (Specimen)

                      Incorporated  by reference to Exhibit 4.1 to  Registrant's
                      Annual Report on Form 10-K for the year ended December 31,
                      1997

      (10) Exhibits--Material contracts

            10.1    --1990 Long-Term Incentive Plan

                      Incorporated  by reference to Exhibit (b) to  Registrant's
                      Annual Report on Form 10-K for the fiscal year ended April
                      30, 1990

            10.2    --Amendment to the 1990 Long Term  Incentive  Plan providing
                      for additional 150,000 shares for issuance under the Plan

                      Incorporated by reference to Exhibit 10(b) to Registrant's
                      Annual  Report on Form  10-KSB for the  fiscal  year ended
                      December 31, 1994 Incorporated

            10.3    --Amendment to the 1990  Long-Term  Incentive Plan providing
                      for additional 140,000 shares for issuance under the Plan

                      Incorporated by reference to Exhibit 10(b) to Registrant's
                      Annual  Report  on Form  10-K for the  fiscal  year  ended
                      December 31, 1996 Incorporated

            10.4    --Business Loan  Agreement with Addendum dated March 4, 1998
                      with  Michigan  National  Bank relating to the $30 million
                      line of credit financing

                      Incorporated  by reference to Exhibit 10.4 to Registrant's
                      Annual Report on Form 10-K for the year ended December 31,
                      1997

            10.5    --Business Loan  Agreement with Addendum dated March 4, 1998
                      with  Michigan  National  Bank  relating to the $5 million
                      Term Loan

                      Incorporated  by reference to Exhibit 10.5 to Registrant's
                      Annual Report on Form 10-K for the year ended December 31,
                      1997

            10.6    --Promissory  Note for $30 million dated March 4, 1998. with
                      Michigan National Bank

                      Incorporated  by reference to Exhibit 10.6 to Registrant's
                      Annual Report on Form 10-K for the year ended December 31,
                      1997

            10.7    --Promissory  Note for $5 million  dated  March 4, 1998 with
                      Michigan National Bank

                      Incorporated  by reference to Exhibit 10.7 to Registrant's
                      Annual Report on Form 10-K for the year ended December 31,
                      1997


                                       10
<PAGE>

            10.8    --Security  Agreement  dated  March 4, 1998.  with  Michigan
                      National Bank

                      Incorporated  by reference to Exhibit 10.8 to Registrant's
                      Annual Report on Form 10-K for the year ended December 31,
                      1997

            10.11   --Non-Competition and Non-Disclosure Agreement dated October
                      27, 1993 by and between  Ernest  Hodas and Century  Supply
                      Corp.

                      Incorporated  by reference to Exhibit 2.3 to  Registrant's
                      Current report on Form 8K for January 5, 1994

            10.12   --Consulting Agreement dated October 27, 1993 by and between
                      Century Supply Corp. and Ernest Hodas

                      Incorporated  by reference to Exhibit 2.4 to  Registrant's
                      Current report on Form 8K for January 5, 1994

            10.13   --Guaranty  dated October 27, 1993 by Richton  International
                      Corporation   in  favor  of  the  Hodas   Family   Limited
                      Partnership  and  Ernest  Hodas,  as Trustee of the Ernest
                      Hodas Revocable Trust and Ernest Hodas

                      Incorporated  by reference to Exhibit 2.6 to  Registrant's
                      Current report on Form 8K for January 5, 1994

            10.14   --Subordination  Agreement  dated  October 27, 1993  between
                      Michigan   National  Bank,   Century  Supply  Corp.   (the
                      "borrower"),  Ernest Hodas, as Trustee of the Ernest Hodas
                      Revocable  Trust and the Hodas Family Limited  Partnership
                      and   Ernest   Hodas   (collectively    referred   to   as
                      "Subordinating creditor")

                      Incorporated  by reference to Exhibit 28.6 to Registrant's
                      Current report on Form 8K for January 5, 1994

            10.15   --Series A  Warrant  to  Purchase  236,250  shares of Common
                      Stock of Richton International Corporation

                      Incorporated  by reference to Exhibit 28.9 to Registrant's
                      Current report on Form 8K for January 5, 1994

            10.16   --Subordinated  Note issued by Richton  International  Corp.
                      dated  October  26,  1993 to Mr.  Fred R.  Sullivan in the
                      principal amount of $1,181,250.

                      Incorporated by reference to Exhibit 28.10 to Registrant's
                      Current report on Form 8K for January 5, 1994

            10.17   --Subordinated  Promissory Note for $1.0 million dated March
                      29, 1995 between CBE Acquisition Corp. and CBE Liquidating
                      Corp.

                      Incorporated  by reference to Exhibit 2.2 to  Registrant's
                      Current report on Form 8K for April 5, 1995

            10.18   --Subordinated  Promissory Note for $1.0 million dated March
                      29, 1995 between  Richton  International  Corporation  and
                      Fred R. Sullivan

                      Incorporated  by reference to Exhibit 2.3 to  Registrant's
                      Current report on Form 8K for April 5, 1995

            10.19   --Guaranty  dated  March 29,  1995 by Richton  International
                      Corp. in favor of the CBE Liquidating Corp.

                      Incorporated  by reference to Exhibit 2.4 to  Registrant's
                      Current report on Form 8K for April 5, 1995

            10.20   --Guaranty  dated March 29, 1995 by Century  Supply Corp. in
                      favor of the CBE Liquidating Corp.


                                       11
<PAGE>

                      Incorporated  by reference to Exhibit 2.5 to  Registrant's
                      Current report on Form 8K for April 5, 1995 (11) Exhibit

            11.1    --Calculation of earnings per share

                      Incorporated  by  reference  to  Footnote  11 to  Notes to
                      Consolidated  Financial  Statements of Registrant's Annual
                      Report on Form 10- K for the year ended December 31, 1998
      
      (21) Exhibits-Subsidiaries of the Registrant

      (99) Exhibits-Other

            99.1    --Fairness  Opinion  received  from  Quirk,  Carson & Pettit
                      relating to the $1.0 million the promissory note agreement
                      between F.R. Sullivan and the Registrant

                      Incorporated  by reference to Exhibit 99.1 to Registrant's
                      Annual Report on Form 10-K for the year ended December 31,
                      1995

            99.2    --Fairness  Opinion  received  from  Quirk,  Carson & Pettit
                      relating to the $1.0 million the promissory note agreement
                      between F.R. Sullivan and the Registrant

                      Incorporated  by reference to Exhibit 99.1 to Registrant's
                      Annual Report on Form 10-K for the year ended December 31,
                      1995

      (b) Reports on Form 8-K

            None.


                                       12
<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.

                                               RICHTON INTERNATIONAL CORPORATION
                                                         (Registrant)

                                               By: /s/ FRED R. SULLIVAN
                                                  ------------------------------
                                                        Fred R. Sullivan
                                                   Chairman of the Board and
                                                    Chief Executive Officer
                                                  (Principal Executive Officer)

Date: March 23, 1999

                                               By: /s/ CORNELIUS F. GRIFFIN
                                                  ------------------------------
                                                       Cornelius F. Griffin
                                                        Vice President and
                                                     Chief Financial Officer
                                                     (Principal Financial and 
                                                       Accounting Officer)

      Pursuant to the requirements of the Securities  Exchange Act of 1934, this
report  has  been  signed  below  by the  following  persons  on  behalf  of the
Registrant and in the capacities and on the date indicated.

            Signature                         Title                    Date
            ---------                         -----                    ----

/s/     FRED R. SULLIVAN            Chairman of the Board and     March 23, 1999
------------------------------         Chief Executive Officer     
        Fred R. Sullivan               (Principal Executive 
                                       Officer)        
                                      

/s/   CORNELIUS F. GRIFFIN          Vice President and Chief      March 23, 1999
------------------------------         Financial Officer      
      Cornelius F. Griffin             (Principal Financial 
                                       and Accounting Officer)
                                       

/s/    NORMAN E. ALEXANDER          Director                      March 23, 1999
------------------------------
       Norman E. Alexander

/s/     DONALD A. MCMAHON           Director                      March 23, 1999
------------------------------
        Donald A. McMahon

/s/      THOMAS J. HILB             Director                      March 23, 1999
------------------------------
         Thomas J. Hilb

/s/     STANLEY J. LEIFER           Director                      March 23, 1999
------------------------------
        Stanley J. Leifer

/s/      PETER A. WHITE             Director                      March 23, 1999
------------------------------
         Peter A. White


                                       13
<PAGE>

                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To Richton International Corporation:

      We have audited the  accompanying  consolidated  balance sheets of Richton
International  Corporation  (a  Delaware  corporation)  and  subsidiaries  as of
December 31, 1998 and 1997, and the related  consolidated  statements of income,
stockholders'  equity and cash  flows for each of the three  years in the period
ended December 31, 1998. 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  generally  accepted  auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

      In our opinion,  the consolidated  financial  statements referred to above
present  fairly,  in all material  respects,  the financial  position of Richton
International  Corporation and  subsidiaries,  as of December 31, 1998 and 1997,
and the results of their  operations  and their cash flows for each of the three
years in the  period  ended  December  31,  1998 in  conformity  with  generally
accepted accounting principles.


                                                        ARTHUR ANDERSEN LLP

                                                        /s/Arthur Andersen LLP

Roseland, New Jersey
February 2, 1999


                                      F-1
<PAGE>

               RICHTON INTERNATIONAL CORPORATION AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                                    
<TABLE>
<CAPTION>
                                                                            December 31,
                                                                    ----------------------------
                                                                       1998            1997
                                                                    ------------    ------------
<S>                                                                 <C>             <C>         
                                   ASSETS
Current assets:
    Cash and Cash Equivalents ...................................   $    995,000    $    474,000
    Notes and Accounts Receivable, net of allowance for doubtful
      accounts of $1,250,000 in 1998 and $690,000 in 1997 .......     24,486,000      16,292,000
    Inventories .................................................     20,419,000      16,190,000
    Prepaid Expenses and Other Current Assets ...................        736,000         602,000
    Deferred Taxes ..............................................        844,000         493,000
                                                                    ------------    ------------
      Total Current Assets ......................................     47,480,000      34,051,000
Property, Plant and Equipment ...................................      3,566,000       2,633,000
    Less: Allowance for Depreciation and Amortization ...........     (1,411,000)     (1,038,000)
                                                                    ------------    ------------
                                                                       2,155,000       1,595,000
Other Assets:
    Deferred taxes ..............................................      1,001,000         716,000
    Goodwill ....................................................      4,515,000       4,011,000
    Other Intangibles ...........................................      2,342,000       1,217,000
                                                                    ------------    ------------
TOTAL ASSETS ....................................................   $ 57,493,000    $ 41,590,000
                                                                    ============    ============
                       LIABILITIES & STOCKHOLDERS' EQUITY

Current Liabilities:
    Current Portion of Long-Term Debt ...........................   $  1,832,000    $  1,773,000
    Notes Payable ...............................................     25,960,000      15,135,000
    Accounts Payable ............................................      5,999,000       5,204,000
    Accrued Liabilities .........................................      4,769,000       2,228,000
    Deferred Income .............................................      2,385,000       2,339,000
                                                                    ------------    ------------
      Total Current Liabilities .................................     40,945,000      26,679,000
Noncurrent Liabilities
    Long-Term Senior Debt .......................................      4,475,000       5,000,000
    Subordinated Debt ...........................................      1,996,000       2,364,000
    Less: Current Portion of Long-Term Debt .....................     (1,832,000)     (1,773,000)
                                                                    ------------    ------------
                                                                       4,639,000       5,591,000
Stockholders' Equity
    Preferred Stock,$1.00 par value; authorized
      500,000 shares; none issued ...............................           --              --
    Common Stock,$.10 par value; authorized 6,000,000 shares;
      issued 3,216,692 shares at December 31, 1998 and 3,086,692
      shares at December 31, 1997 ...............................        322,000         309,000
Additional Paid-in Capital ......................................     18,013,000      17,654,000
Accumulated Deficit .............................................     (4,696,000)     (8,228,000)
Treasury Stock (267,000 and 140,000 shares at cost, respectively)     (1,430,000)       (415,000)
Cumulative  Translation adjustment ..............................       (130,000)           --
Deferred Stock Compensation .....................................       (170,000)           --
                                                                    ------------    ------------
      Total Stockholders' Equity ................................     11,909,000       9,320,000
                                                                    ------------    ------------
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY ........................   $ 57,493,000    $ 41,590,000
                                                                    ============    ============
</TABLE>

 The accompanying notes are an integral part of these consolidated statements.


                                      F-2
<PAGE>

               RICHTON INTERNATIONAL CORPORATION AND SUBSIDIARIES
                        CONSOLIDATED STATEMENTS OF INCOME

<TABLE>
<CAPTION>
                                                               Year ended December 31,
                                                  ----------------------------------------------
                                                      1998              1997            1996
                                                      ----              ----            ----
<S>                                               <C>              <C>              <C>         
Net Sales .....................................   $ 147,899,000    $ 106,523,000    $ 87,750,000
Cost of Sales .................................     107,138,000       76,334,000      62,966,000
                                                  -------------    -------------    ------------
      Gross Profit ............................      40,761,000       30,189,000      24,784,000
Selling, general & administrative
   expenses ...................................      33,179,000       24,684,000      20,952,000
                                                  -------------    -------------    ------------
      Income from Operations ..................       7,582,000        5,505,000       3,832,000
Interest income ...............................        (659,000)        (519,000)       (407,000)
Interest  expense .............................       2,263,000        1,853,000       1,623,000
                                                  -------------    -------------    ------------
      Income  before provision for income taxes       5,978,000        4,171,000       2,616,000
Provision for income taxes ....................       2,446,000        1,881,000         850,000
                                                  -------------    -------------    ------------
      Net Income ..............................   $   3,532,000    $   2,290,000    $  1,766,000
                                                  =============    =============    ============
Net Income per common share:
      Basic ...................................   $        1.22    $        0.78    $       0.60
                                                  =============    =============    ============
      Diluted .................................   $        1.06    $        0.68    $       0.54
                                                  =============    =============    ============
Weighted Average Common and Common Equivalent
   Shares outstanding
      Basic ...................................       2,905,000        2,948,000       2,949,000
                                                  =============    =============    ============
      Diluted .................................       3,318,000        3,372,000       3,290,000
                                                  =============    =============    ============
</TABLE>

 The accompanying notes are an integral part of these consolidated statements.


                                      F-3
<PAGE>

               RICHTON INTERNATIONAL CORPORATION AND SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
<TABLE>
<CAPTION>
                                                Additional                                  Cumulative    Deferred        Total
                         Common       Common     Paid-in      Accumulated      Treasury     Translation     Stock      Stockholders'
                         shares        stock      Capital         Deficit        Stock       Adjustment  Compensation     Equity
                         ------        -----      -------         -------        -----       ----------  ------------     ------
<S>                      <C>          <C>       <C>            <C>             <C>              <C>        <C>          <C>        
Balance at
   December 31, 1995 ... 3,088,247    $309,000  $17,661,000    $(12,284,000)   $ (415,000)      $  --                   $ 5,271,000
Net Income .............    --          --           --           1,766,000         --             --                     1,766,000
                         ---------    --------  -----------    ------------   -----------      ---------  ---------     -----------
Balance at
   December 31, 1996 ... 3,088,247     309,000   17,661,000     (10,518,000)     (415,000)         --                     7,037,000
Net Income .............    --          --           --           2,290,000         --             --                     2,290,000
Purchase of 1,555
   Common Shares .......    (1,555)     --           (7,000)         --             --             --                        (7,000)
                         ---------    --------  -----------    ------------   -----------      ---------  ---------     -----------
Balance at
   December 31, 1997 ... 3,086,692     309,000    17,654,000     (8,228,000)     (415,000)         --                     9,320,000
Net Income .............    --          --           --           3,532,000         --             --                     3,532,000
Issuance of restricted  
   common stock ........    20,000       2,000      168,000          --             --             --      (170,000)              0
Purchase of  127,000
   Common Shares .......    --          --           --              --        (1,015,000)         --                    (1,015,000)
Exercise of Stock
   Options .............   110,000      11,000      191,000          --             --             --                       202,000
Cumulative Translation
   Adjustment ..........    --          --           --              --             --          (130,000)                  (130,000)
                         ---------    --------  -----------    ------------   -----------      ---------  ---------     -----------
Balance at
   December 31, 1998 ... 3,216,692    $322,000  $18,013,000    $ (4,696,000)  $(1,430,000)     $(130,000) $(170,000)    $11,909,000
                         =========    ========  ===========    ============   ===========      =========  =========     ===========
</TABLE>

 The accompanying notes are an integral part of these consolidated statements.

                                      F-4
<PAGE>

               RICHTON INTERNATIONAL CORPORATION AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
                                                                      Year ended December 31,
                                                              ------------------------------------------
                                                                 1998            1997          1996
                                                                 ----            ----          ----
<S>                                                           <C>             <C>            <C>        
OPERATING ACTIVITIES
Net  Income ...............................................   $  3,532,000    $ 2,290,000    $ 1,766,000
   Reconciliation of net income to  net cash provided
      by (used in )operating activities:
      Depreciation and amortization .......................      1,100,000      1,350,000      1,860,000
      Deferred taxes ......................................       (636,000)     1,583,000        672,000
   Changes in operating assets and Liabilities:
      Deferred Income .....................................         46,000        179,000       (115,000)
      Other working capital items, assets .................     (8,093,000)    (8,229,000)    (4,839,000)
      Other working capital items, liabilities ............      2,963,000      1,002,000        625,000
      Other assets ........................................       (181,000)        (7,000)       142,000
                                                              ------------    -----------    -----------
        Net cash provided by (used in) operating activities     (1,269,000)    (1,832,000)       111,000
INVESTING ACTIVITIES
Capital expenditures ......................................       (445,000)      (135,000)      (350,000)
Cash paid  for acquisitions, net of cash acquired .........     (6,421,000)    (3,318,000)    (2,093,000)
                                                              ------------    -----------    -----------
        Net cash  used in investing activities ............     (6,866,000)    (3,453,000)    (2,443,000)
FINANCING ACTIVITIES
Proceeds from Long-Term  Debt .............................           --             --        1,400,000
Repayment of Subordinated Debt ............................       (701,000)    (1,594,000)    (1,235,000)
Exercise of Stock options .................................        202,000           --             --
Repurchase of Shares ......................................     (1,015,000)        (7,000)          --
Proceeds from Line of Credit ..............................     10,825,000      7,188,000      2,672,000
Repayment of Long -Term Debt ..............................       (525,000)      (200,000)      (600,000)
                                                              ------------    -----------    -----------
        Net cash provided by financing activities .........      8,786,000      5,387,000      2,237,000

Effect of exchange rate on cash balances ..................       (130,000)          --             --
                                                              ------------    -----------    -----------

Increase (Decrease) in cash and cash equivalents ..........        521,000        102,000        (95,000)
Cash and cash  equivalents, beginning of period ...........        474,000        372,000        467,000
                                                              ------------    -----------    -----------
Cash and cash equivalents, end of period ..................   $    995,000    $   474,000    $   372,000
                                                              ============    ===========    ===========
SUPPLEMENTAL DISCLOSURE OF CASH
FLOW INFORMATION:
   Cash paid for interest .................................   $  2,161,000    $ 1,728,000    $ 1,391,000
                                                              ============    ===========    ===========
   Cash paid for income taxes .............................   $  1,863,000    $   247,000    $   430,000
                                                              ============    ===========    ===========
</TABLE>

 The accompanying notes are an integral part of these consolidated statements.


                                      F-5
<PAGE>

               RICHTON INTERNATIONAL CORPORATION AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Description of Business:

      Richton  International  Corporation  ("Richton") is a holding company with
two  principal   subsidiaries,   Century  Supply  Corp.   ("Century")   and  CBE
Technologies  Inc  ("CBE"),  collectively  the  "Company".  Century is a leading
full-service  wholesale  distributor of sprinkler  irrigation  systems,  outdoor
lighting and  decorative  fountain  equipment.  Branches  serve  customers in 33
states mostly in the eastern  United States and in Ontario,  Canada.  Irrigation
products  have  historically  been  sold  by  manufacturers   primarily  through
wholesale distributors.  Century is a major distributor in the United States for
all of the leading  original  equipment  manufacturers  (OEM) in the  irrigation
systems field.

      CBE Technologies,  Inc. ("CBE") is headquartered in Boston,  Massachusetts
with satellite offices located in New York, Los Angeles and Portland, Maine. CBE
is a Systems Integrator providing network consulting,  design, and installation;
network  management  and  related  support;   technical  services   outsourcing;
comprehensive  hardware  maintenance;   and  equipment  sales.  CBE's  technical
certifications  include;  Novell Platinum  reseller,  Microsoft Channel partner,
Banyan  Enterprise/Network  dealer,  Novell  authorized  Training Center,  and a
Novell Authorized Service Center.

2. Summary of Significant Accounting Policies:

      Principles  of  Consolidation--The   accompanying  consolidated  financial
statements  include the accounts of Richton and all  wholly-owned  subsidiaries.
All   inter-company   accounts  and   transactions   have  been   eliminated  in
consolidation.

      Use of  Estimates--The  preparation of financial  statements in conformity
with  generally  accepted  accounting  principles  requires  management  to make
estimates  and  assumptions  that  affect  the  reported  amounts  of assets and
liabilities  and disclosure of contingent  assets and liabilities at the date of
the  financial  statements  and the  reported  amounts of revenues  and expenses
during the reporting period. Actual results could differ from those estimates.

      Cash and Cash Equivalents--Cash and cash equivalents include highly liquid
investments with original maturities of three months or less.

      Allowance  For Doubtful  Accounts--The  Company  provides an allowance for
doubtful accounts arising from operations of the business, based upon a specific
review of certain outstanding amounts and historical experience.

      Inventories--The  Company values  inventory,  which  consists  entirely of
finished  goods,  at the lower of cost or market  using the  first-in  first-out
("FIFO") method of accounting.

      Goodwill--Goodwill  shown in the  consolidated  balance sheets at December
31, 1998 and 1997  relates to multiple  acquisitions  completed  during the last
four years.  Goodwill is being amortized on a  straight-line  basis over 5 to 15
years.

       Other Intangibles--Other  intangibles consist principally of amounts paid
to sellers of businesses  acquired  subject to  non-compete  agreements  and are
being  amortized  over  periods  of  1-5  years.  Cost  allocated  primarily  to
non-compete  agreements  were $2,025,000 and $1,115,000 at December 31, 1998 and
1997,  respectively.  Accumulated  amortization  was  $352,000  and  $287,000 at
December 31, 1998 and 1997, respectively.

      Long-Lived  Assets--The  provisions  of SFAS No. 121  "Accounting  for the
Impairment of Long Lived Assets"  requires,  among other things,  that an entity
review its  long-lived  assets and certain  related  intangibles  for impairment
whenever changes in circumstances  indicate that the carrying amount of an asset
may not be fully recoverable.  The Company continually  evaluates whether events
and  circumstances  have occurred that indicate the remaining  estimated  useful
life of long-lived assets, including goodwill and other intangibles,  may not be
recoverable.  As a result of this review,  management  does not believe there is
any impairment of its long-lived assets at December 31, 1998.


                                      F-6
<PAGE>

               RICHTON INTERNATIONAL CORPORATION AND SUBSIDIARIES

              NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--Continued

       Revenue  Recognition--Revenue from sales and services are recorded at the
time the  product  is  shipped to the  customer  or the  service to be billed is
completed.  The  Company  reports  its  sales  levels on a net  basis,  which is
computed by deducting from gross sales the amount of actual returns received and
an amount established for anticipated returns.

      Sales Returns--The  Company reports its sales levels on a net sales basis,
with net sales being computed by deducting from gross sales the amount of actual
sales  returns  and the amount of reserves  established  for  anticipated  sales
returns.

      Deferred  Income--Deferred  income represents cash received from customers
related to service  contracts  that extend for specified  periods of time,  less
than  one  year.  Income  is  recognized  proportionally  over  the  life of the
contract.

      Income  Taxes--The  Company  accounts for income taxes in accordance  with
SFAS No. 109, "Accounting for Income Taxes". This statement requires the Company
to recognize  deferred tax assets and  liabilities  for the expected  future tax
consequences  of events that have been  recognized  in the  Company's  financial
statements  or  tax  returns.  Under  this  method,   deferred  tax  assets  and
liabilities  are  determined  based  on the  difference  between  the  financial
statement carrying amounts and the tax basis of assets and liabilities.

      Accounting  for Stock  Based  Compensation--The  Company  has  elected  to
account for stock-based compensation using the intrinsic value method prescribed
in Accounting  Principles Board Opinion No. 25,  "Accounting for Stock issued to
Employees,"  and related  interpretations.  Accordingly,  compensation  cost for
stock  options is measured as the excess,  if any, of the quoted market price of
the  Company's  stock at the date of grant over the amount the employee must pay
to acquire the stock and is recorded in the  accompanying  statements of income.
The Company has provided pro forma  disclosure  of the fair value at the date of
grant  of stock  options  granted  during  1998,  1997  and 1996 in Note 10,  in
accordance with the disclosure-only  provisions of SFAS No. 123, "Accounting for
Stock-Based Compensation".

      Comprehensive  Income--In  June 1997, the Financial  Accounting  Standards
Board  issued  SFAS  No.  130  "Reporting  Comprehensive  Income."  SFAS  No.130
establishes  standards for reporting and display of comprehensive income and its
components in a full set of financial  statements.  The Company adopted SFAS No.
130 during 1998.  The Company's  comprehensive  income  consists of a cumulative
translation  adjustment  of $130,000.  Total  comprehensive  income has not been
presented on the accompanying consolidated financial statements as the impact is
not material to the consolidated financial statements.

       Derivative  Instruments--In  June 1998,  the FASB  issued  SFAS No. 133 "
Accounting for Derivative  Instruments and Hedging  Activities."  This statement
establishes  accounting  and  reporting  standards for  derivative  instruments,
including certain derivative  instruments  embedded in other contracts,  and for
hedging  activities.  SFAS No. 133 is effective  for all fiscal years  beginning
after June 15, 1999 and will not require retroactive restatement of prior period
financial  statements.  The Company  does not  presently  make  material  use of
derivative instruments.

      Reclassification--Certain  prior year balances have been  reclassified  to
conform with current year presentations.

3.  Acquisitions:

      During 1998,  Century  acquired five different  distributor  operations in
four  different  markets:  Northern New Jersey,  Idaho,  Utah and Florida for an
aggregate purchase price of $6.4 million. The acquisitions were made in cash and
were financed by its working  capital  line. As a result of these  acquisitions,
the Company recorded $4.2 million of tangible net assets.  Century also opened a
branch in Oregon as well as 14 other  branches in existing  markets.  Similar to
past experience,  these acquisitions were made primarily after the prime selling
season.


                                      F-7
<PAGE>

               RICHTON INTERNATIONAL CORPORATION AND SUBSIDIARIES

              NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--Continued

4.  Property Plant and Equipment:

                                                            December 31
                                                      -------------------------
                                                         1998           1997
                                                      ----------   ------------
Land ...............................................  $  608,000   $    187,000
Building and Improvements ..........................     734,000        848,000
Autos and Trucks ...................................     548,000        539,000
Machinery and Equipment ............................   1,125,000        600,000
Furniture and Fixtures .............................     551,000        459,000
                                                      ----------   ------------
                                                      $3,566,000   $  2,633,000
Less: Accumulated Depreciation and amortization ....   1,411,000      1,038,000
                                                      ----------   ------------
                                                      $2,155,000   $  1,595,000
                                                      ==========   ============
                                                      
      All fixed assets are currently depreciated over five years except building
improvements  which are amortized over the respective lease terms which are from
2 to 10 years or the life of the assets whichever is shorter.


5. Income Taxes:

      At December 31, 1998 and 1997,  the Company has total  deferred tax assets
of  approximately  $1.8  million  and $1.2  million,  respectively.  Significant
components  of the  deferred  tax  assets  related  to  differences  in tax  and
financial accounting bases, are as follows:

                                                     1998          1997
                                                   ---------     ---------
     Current:
     Allowance for bad debts ................     $  425,000      $ 234,000
     Inventory Reserves .....................        258,000           -- 
     Other ..................................        161,000        259,000
                                                  ----------      ---------
                                                  $  844,000      $ 493,000
                                                  ==========      =========
     Long Term:
     Amortization ...........................        921,000        682,000
     Depreciation ...........................         30,000        34,000
     Other ..................................         50,000           --
                                                  ----------      ---------
                                                  $1,001,000      $ 716,000
                                                  ==========      =========

      The provision for income taxes for the three years ended December 31, 1998
consists of the following:

                                         1998           1997            1996
                                         -----          -----           -----
     Federal
       Current .....................   $2,668,000      $ 160,000       $109,000
       Deferred ....................     (636,000)     1,399,000        672,000
     State & Local .................      448,000        322,000         50,000
     Other .........................      (34,000)          --           19,000
                                       ----------     ----------       --------
                                       $2,446,000     $1,881,000       $850,000
                                       ==========     ==========       ========


                                      F-8
<PAGE>

               RICHTON INTERNATIONAL CORPORATION AND SUBSIDIARIES

              NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--Continued

      A  reconciliation  of  the  Federal  provision  for  income  taxes  at the
statutory rate to the actual provision rate for income taxes for the three years
ended December 31, 1998, is as follows:

                                         1998             1997          1996
                                         ----             ----          ----
     Federal .......................      34%              34%           34%
     State & Local                         7                8             3
     Other .........................      --                3            (4)
                                          ---              ---           ---
                                          41%              45%           33%
                                          ===              ===           ===

6. Statement of Cash Flows:

      The components of other working capital items included in the Consolidated
Statements of Cash Flows are as follows:

                                                   Year Ended December 31,
                                   ---------------------------------------------
                                       1998            1997            1996
                                       -----           ----            -----
Receivables                        $(6,738,000)     (2,471,000)    $(3,232,000)
Inventories                         (1,235,000)     (5,623,000)     (1,595,000)
Prepaid Expenses                      (120,000)       (135,000)        (12,000)
                                 
Increase in Working Capital      
     Items, Assets                 $(8,093,000)    $(8,229,000)    $(4,839,000)
                                   ===========     ===========     ===========
                                 
                                 
Accounts Payable                       795,000       1,226,000         775,000
Accrued Liabilities                  2,168,000        (224,000)       (150,000)
                                   -----------     -----------      ----------
Increase Working Capital         
     Items, Liabilities            $ 2,963,000     $ 1,002,000       $ 625,000
                                   ===========     ===========      ==========

7. Financing Arrangements:

      The Company has a senior term note and revolving line of credit  financing
agreement with Michigan  National Bank. The agreement  currently  provides for a
$35 million  revolving line of credit and a $5 million  senior term debt.  These
loans carry an interest rate based upon LIBOR plus 175 basis points (at December
31, 1998 the interest  rate was 7.4%).  The  outstanding  balance on the line of
credit at  December  31,  1998 and 1997 was  $26.0  million  and $15.1  million,
respectively.  The  term  loan is  amortized  at the  rate of $.18  million  per
quarter.  The above agreement contains various covenants that among other things
require the Company to maintain certain financial ratios.


                                      F-9
<PAGE>

               RICHTON INTERNATIONAL CORPORATION AND SUBSIDIARIES

              NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--Continued

8. Long-Term Debt:

      The Company has the following long-term debt as of December 31,

                                                     1998               1997
                                                     ----               ----

Term note payable to a bank, secured by
accounts receivable, inventory, furniture and
equipment, interest at Libor plus 175 points
(7.4% as of December 31, 1998), payable in
quarterly installments of $175,000, final
payment due April 27, 2001 ....................... $4,475,000        $5,000,000

Installments payable to former owner of
Century, unsecured and subordinated to bank
debt, payable in quarterly installments of
$50,000, final payment due June 30, 2000 .........    268,000           468,000

Note payable to related party, unsecured and
subordinated to bank debt, interest at 9%,
payable in semi-annual installments of
$118,125 commencing April 1996, final payment
due October 31, 1999-- recorded net of
discount (A) .....................................    341,000           459,000

Note payable to related party, unsecured and
subordinated to the term note payable to
bank, interest at 10%, payable in 10
installments of $100,000 on October 15th and
April 15th, final payment due April
2000--recorded net of discount (B) ...............    362,000           450,000

Note payable to seller of CBE, unsecured, and
subordinated to the all bank debt, interest
at 9% payable in 10 installments of $100,000
on October 15th and April 15th, final payment
due April 2000 ...................................    254,000           428,000

Other ............................................    771,000           559,000
                                                   ----------        ----------
                                                    6,471,000         7,364,000
Less: Current Portion ............................ (1,832,000)       (1,773,000)
                                                   ----------        ----------
                                                   $4,639,000        $5,591,000
                                                   ==========        ==========

      (A): The Company issued 236,250  warrants to acquire 236,250 shares of the
common stock of Richton at $1 3/8 per share in  connection  with this loan.  The
warrants were valued at $143,000 which  represented the fair market value at the
date of grant.

      (B): The Company  issued  100,000  warrants to acquire  100,000  shares of
Richton's common stock at $3.0 per share which represented the fair market value
at the time of issuance.

      The scheduled future maturities of long-term debt at December 31, 1998 are
as follows:

            1999 .............................................      $1,832,000
            2000 .............................................       1,262,000
            2001 .............................................       3,150,000
            2002 .............................................         227,000
                                                                    ----------
                                                                    $6,471,000
                                                                    ==========
9. Retirement Plans:

      The Company's Richton employees were covered by a noncontributory, defined
benefit plan (the "Retirement Plan") sponsored by Richton.  Effective,  June 30,
1997 the Plan was  effectively  terminated  and the  amounts  then  owing to its
active employees were paid out.


                                      F-10
<PAGE>

               RICHTON INTERNATIONAL CORPORATION AND SUBSIDIARIES

              NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--Continued

      Pension  expense  reflected in the  consolidated  statements of income for
this Plan was $37,000 in 1997 and 1996 and $155,000 in 1995.

      Century and CBE have Tax Deferred Savings Plans under Section 401 (k) (the
"Plans") of the Internal Revenue Code. The Plans allows employees to defer up to
15% of eligible  compensation  on a pre-tax basis through  contributions  to the
Plans. Under the provisions of the Plans, Century has elected to contribute, for
every dollar the employee contributes,  50 % of the employee's amount, up to 4 %
of eligible compensation. Century may also make discretionary contributions. The
charge  to  income  for   employer   contributions   to  the  Century  Plan  was
approximately $361,000,  $285,000, and $224,000 for the years ended December 31,
1998, 1997 and 1996, respectively.  Century's discretionary  contribution to the
Plan was  $240,000,  $190,000,  and  $170,000  in each of the three  years ended
December 31, 1998, respectively. CBE has elected to not contribute to its Plan.

10.  Stock Options:

      The Company has as part of its 1990 Long-Term  Compensation  Plan, a Stock
Option Plan ("the Plan").  Richton  accounts for this plan under APB Opinion No.
25, under which no compensation cost has been recognized.  Had compensation cost
for this plan been  determined  consistent with SFAS No. 123 for options granted
subsequent  to January  1995 , the  Company's  net income and earnings per share
would have been as follows:

                                                     1998            1997
                                                     -----          -----
     Net Income:
         As reported .........................    $3,532,000      $2,290,000
         Pro Forma ...........................     3,528,000       2,266,000

     Earnings per share:
         As reported--basic ..................         $1.22            $.78
                    --diluted ................          1.06            . 68

       Pro Forma--basic ......................         $1.21            $.77
                --diluted ....................          1.06             .67

      The Company may grant options for up to 415,000 shares under the Plan. The
Company has granted  options  representing  315,000 shares through  December 31,
1998.  Options are granted  over terms not to exceed ten years.  Under the Plan,
the option  exercise  price  equals the  stock's  market  price on date of grant
except for options granted the Chairman of the Board. The exercise price for Mr.
Sullivan's options are at 110% of the current market price at date of grant.

      A summary of the status of the Company  stock  option plan at December 31,
1998, 1997 and 1996 is presented in the table below:

<TABLE>
<CAPTION>
                                                  1998                     1997                    1996
                                          ---------------------    ---------------------   ---------------------
                                                       Wtd Avg                  Wtd Avg                  Wtd Avg
                                         Shares       ex price     Shares       ex price    Shares       ex price
                                         ------        -------     ------        -------    ------        -------
<S>                                      <C>           <C>         <C>          <C>         <C>          <C>   
Outstanding at beginning of year .....   315,000       $ 2.59      275,000      $ 2.20      270,000      $ 2.15
Granted ..............................        --           --       40,000        5.24       5,000         5.09
Exercised ............................   110,000         1.84          --          --           --          --
Cancelled ............................        --           --          --          --           --          --

Outstanding at end of year ...........   205,000       $ 3.03      315,000      $ 2.59      275,000       $2.20
Exercisable at end of year ...........   205,000         3.03      315,000        2.59      270,000        2.15
</TABLE>

      The Company has issued warrants to purchase 336,250 shares of Common Stock
in  connection  with two  debt  agreements  (see  Note 8).  These  warrants  are
currently exercisable and will expire in seven years from date of issue.


                                      F-11
<PAGE>

               RICHTON INTERNATIONAL CORPORATION AND SUBSIDIARIES

              NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--Continued

      On  December 1, 1998 the Company  issued a  restricted  stock grant to the
Chairman  of the Board for 20,000  shares  subject to  certain  restrictions  as
provided  for in the  grant.  At the time of the grant the  market  price of the
Company's  common  stock was $8.50 per share.  The value of these  shares at the
grant date is included as a separate  component  of  stockholders'  equity and a
related compensation charge is being recorded over the vesting period.

11.  Net Income Per Share:

      Net income  per common  share was  calculated  on the basis of  3,318,000,
3,372,000,  and 3,290,000  weighted average common and common  equivalent shares
outstanding in the years ending December 31, 1998, 1997, and 1996, respectively.

<TABLE>
<CAPTION>

                                                                                   Net Income
                                                     Income          Shares         Per share
                                                     ------          ------         ---------
                                                      For the year ended December 31, 1996
                                                      ------------------------------------
<S>                                                <C>              <C>               <C>  
Basic .........................................    $1,766,000       2,949,000         $ .60
Effect of dilutive options and warrants .......            --         341,000            --
Diluted .......................................    $1,766,000       3,290,000         $ .54


                                                      For the year ended December 31, 1997
                                                      ------------------------------------
Basic .........................................    $2,290,000       2,948,000         $ .78
Effect of dilutive options and warrants .......            --         424,000            --
Diluted .......................................    $2,290,000       3,372,000         $ .68


                                                      For the year ended December 31, 1998
                                                      ------------------------------------
Basic .........................................    $3,532,000       2,905,000         $1.22
Effect of dilutive options and warrants .......            --         413,000            --
Diluted .......................................    $3,532,000       3,318,000         $1.06
</TABLE>

      Basic net income per common  share was  computed by dividing net income by
the weighted  average  number of shares of common stock  outstanding  during the
year.  Diluted net income per common  share  included  the effect of options and
warrants computed under the treasury stock method.

12. Long-term Leases and other Commitments:

      The Company leases its corporate offices, distribution facilities and data
processing  equipment  under  agreements  which expire at varying  dates through
2007. Minimum annual rental commitments at December 31, 1998, are as follows:

            1999 ............................................    $2,900,000
            2000 ............................................     2,030,000
            2001 ............................................     1,280,000
            2002 ............................................       643,000
            2003 ............................................       247,000
            Thereafter ......................................       135,000
                                                                 ----------
                                                                 $7,235,000
                                                                 ==========

      Rent expense under the Company's  various operating leases was $2,431,000,
$1,795,000 and $1,478,000 for the years ended December 31, 1998, 1997, and 1996,
respectively.


                                      F-12
<PAGE>

               RICHTON INTERNATIONAL CORPORATION AND SUBSIDIARIES

              NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--Continued

13. Segment Data:

      The  Company  adopted  SFAS  No.  131  Disclosures  about  Segments  of an
Enterprise and Related  Information  during the fourth quarter of 1998. SFAS No.
131 established  standards for reporting information about operating segments in
annual financial  statements and requires  selected  information about operating
segments  in  interim  financial   reports  issued  to  stockholders.   It  also
established  standards for related  disclosure  about  products and services and
geographic areas.  Operating segments are defined as components of an enterprise
about which  separate  financial  information  is  available  that is  evaluated
regularly be the chief  operating  decision  maker,  or decision making group in
deciding how to allocate resources and in assessing performance.

      The Company operates in two industry segments, wholesale distribution, and
computer and  networking  services.  See Note 1 for  description  of businesses.
There are no  inter-segment  sales and all sales occur in North America.  Income
(loss) from  operations by industry  segment  consists of net sales less related
cost and expenses.  In computing income (loss) from operations by segment,  cost
of borrowed funds for working capital have been included. Corporate includes the
general  and  corporate  expenses  and  interest  incurred  to  acquire  the two
businesses.   Corporate   operating  expenses  directly  traceable  to  industry
segments,  if any,  have  been  allocated  to those  segments.  Amortization  of
goodwill  and related  impairment  charges are  considered  segment  related and
accordingly  charged to the related  industry  segment.  Identifiable  assets by
industry  segment are those assets that are used in the business's  operation in
each  industry  segment and do not include  general  corporate  assets.  General
corporate  assets  consist  primarily of cash,  deferred  taxes,  and  corporate
property.

                                                             Corporate
                                  Wholesale     Computer      Charges/
                                 Distribution   Services      Interest    Total
                                 ------------   --------      --------   ------
                                                     (in millions)
                                 ----------------------------------------------

Sales ........................      $125.0        $22.9        $--      $147.9
                                    ======        =====        ====     ======
Pre-Tax Income ...............         7.0          (.1)        (.9)       6.0
                                    ======        =====        ====     ======
Identifiable Assets ..........      $ 43.6        $ 9.2       $ 4.7     $ 57.5
                                    ======        =====        ====     ======

14.  Subsequent Event:

      On February 25,  1999,  the Company  acquired  100% of the common stock of
Creative Business Concepts (CBC) of Costa Mesa,  California,  a leading computer
networking  integrator,  for cash. CBC will be consolidated  with the Costa Mesa
office of Richton's CBE subsidiary.  The acquisition  will be accounted for as a
purchase.  The unaudited  balance sheet of CBC as of December 31, 1998 reflected
$3.6 million in total assets and $3.1 million in total liabilities.  The company
expects to recognize  approximately $1.8 million in additional  goodwill on this
acquisition.


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