UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

                   QUARTERLY REPORT UNDER SECTION 13 OR 15(d)

                     OF THE SECURITIES EXCHANGE ACT OF 1934





For Quarter Ended September 27, 1997                 Commission File No. 0-12375


                        PEACHES ENTERTAINMENT CORPORATION
             (Exact Name of Registrant as Specified in Its Charter)


             Florida                                          59-2166041
(State or Other Jurisdiction of                       (I.R.S. Employer I.D. No.)
  Incorporation or Organization)


1180 E Hallandale Beach Blvd., Hallandale, FL                   33009
  (Address of Principal Executive Offices)                    (Zip Code)


Registrant's telephone number, including area code:         (954) 454-5554


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  registrants  were
required  to file  such  reports),  and  (2)  has  been  subject  to the  filing
requirements for at least the past 90 days.



                             YES __X__     NO _____




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



At September 27, 1997, there were outstanding:


39,781,270 shares of common stock


<PAGE>



                        PEACHES ENTERTAINMENT CORPORATION

                                      Index


PART I. FINANCIAL INFORMATION

   Item 1. Financial Statements

         Condensed Balance Sheets-September 27, 1997 
            (Unaudited) and March 29, 1997                                    3

         Condensed Statements of Operations and Retained 
            Deficit-Three Months Ended September 27, 1997 
            and September 28, 1996 (Unaudited)                                4

         Condensed Statements of Operations and Retained 
            Deficit-Six Months Ended September 27, 1997 
            and September 28, 1996 (Unaudited)                                5

         Condensed Statements of Cash Flows-Six Months 
            Ended September 27, 1997 and September 28, 1996 
            (Unaudited)                                                       6

         Notes to Condensed Financial Statements                              7

   Item 2. Management's Discussion and Analysis of Financial 
        Condition and Results of Operations                                   9

PART II. OTHER INFORMATION

   Item 6. Exhibits and Reports on Form 8-K                                  11

SIGNATURES                                                                   12


                                       -2-

<PAGE>



                         PART I - FINANCIAL INFORMATION
                          Item 1. Financial Statements

                        PEACHES ENTERTAINMENT CORPORATION

                            Condensed Balance Sheets

                      September 27, 1997 and March 29, 1997

<TABLE>
<CAPTION>
                               Assets                              September 27,     March 29,
                                                                       1997            1997
                                                                       ----            ----
                                                                   (unaudited)       
<S>                                                                <C>              <C>      
Current assets:
     Cash and cash equivalents                                     $ 1,159,994      1,456,070
     Inventories                                                     2,813,055      2,855,494
     Prepaid expenses and other current assets                         197,910        260,008
                                                                   -----------      ---------
                   Total current assets                              4,170,959      4,571,572

Property and equipment, net                                          1,339,635      1,439,731
Other assets                                                           165,039        158,762
                                                                   -----------      ---------
                                                                   $ 5,675,633      6,170,065
                                                                   ===========      =========

                Liabilities and Shareholders' Equity

Current liabilities:
     Current portion of long-term obligations                          757,978        730,239
     Accounts payable                                                1,756,630      1,371,869
     Accrued liabilities                                               872,597        956,005
                                                                   -----------      ---------
                   Total current liabilities                         3,387,205      3,058,113

Long-term obligations                                                1,091,663      1,337,190
Due to parent                                                          734,562        704,813
Deferred rent                                                          133,559        156,036
                                                                   -----------      ---------
                   Total liabilities                                 5,346,989      5,256,152
                                                                   ===========      =========

Shareholders' equity:
     Preferred stock, $100 par value; 50,000 shares authorized;
        5,000 shares issued and outstanding                            500,000        500,000
     Common stock subscribed (20,000,000 shares)                          --          350,000
     Common stock, $.01 par value; 40,000,000 shares authorized;
        39,889,120 and 19,889,120 shares issued, respectively          548,892        198,892
     Additional paid-in capital                                      1,284,471      1,284,471
     Retained deficit                                               (1,984,939)    (1,399,670)
                                                                   -----------      ---------
                                                                       348,424        933,693

     Treasury stock, 107,850 common shares, at cost                    (19,780)       (19,780)
                                                                   -----------      ---------
                   Total shareholders' equity                          328,644        913,913

Commitments and contingencies
                                                                   -----------      ---------
                                                                   $ 5,675,633      6,170,065
                                                                   ===========      =========
</TABLE>

See accompanying notes to condensed financial statements.


                                       -3-

<PAGE>


                        PEACHES ENTERTAINMENT CORPORATION

             Condensed Statements of Operations and Retained Deficit

          Three months ended September 27, 1997 and September 28, 1996
                                   (Unaudited)



                                                  September 27,    September 28,
                                                      1997             1996
                                                      ----             ----

Net sales                                          $ 3,808,512        3,888,049
                                                   -----------        ---------
Costs and expenses:                                                 
     Cost of sales                                   2,347,920        2,479,044
     Selling, general and administrative expenses    1,674,012        1,783,511
     Depreciation and amortization                      65,700           77,518
                                                   -----------        ---------
                                                     4,087,632        4,340,073
                                                   -----------        ---------
         Loss from operations                         (279,120)        (452,024)
                                                   -----------        ---------
Other (expense) income:                                             
     Interest expense                                  (58,491)         (18,318)
     Interest income                                     6,899            5,274
                                                   -----------        ---------
                                                       (51,592)         (13,044)
                                                   -----------        ---------
         Loss before reorganization costs                           
          and income taxes                            (330,712)        (465,068)
                                                                    
Reorganization costs:                                               
     Professional fees                                    --            (97,538)
                                                   -----------        ---------
         Loss before income taxes                     (330,712)        (562,606)
                                                                    
Provision for income taxes                                --               --
                                                   -----------        ---------
         Net loss                                     (330,712)        (562,606)
                                                                    
Retained deficit, beginning of period               (1,639,227)      (1,027,324)
                                                                    
Preferred stock dividend                               (15,000)            --
                                                   -----------        ---------
Retained deficit, end of period                    $(1,984,939)      (1,589,930)
                                                   ===========        =========
Net loss per common share                          $      (.01)            (.03)
                                                   ===========        =========

See accompanying notes to condensed financial statements.


                                       -4-

<PAGE>



                        PEACHES ENTERTAINMENT CORPORATION

             Condensed Statements of Operations and Retained Deficit

           Six months ended September 27, 1997 and September 28, 1996
                                   (Unaudited)



                                                   September 27,   September 28,
                                                       1997            1996
                                                       ----            ----

Net sales                                            $ 7,932,863     8,193,870
                                                     -----------     ---------

Costs and expenses:
     Cost of sales                                     4,901,010     5,303,196
     Selling, general and administrative expenses      3,302,022     3,619,570
     Depreciation and amortization                       131,400       151,884
                                                     -----------     ---------

                                                       8,334,432     9,074,650
                                                     -----------     ---------

          Loss from operations                          (401,569)     (880,780)
                                                     -----------     ---------

Other (expense) income:
     Interest expense                                   (119,142)      (36,931)
     Interest income                                       9,442        19,286
                                                     -----------     ---------

                                                        (109,700)      (17,645)
                                                     -----------     ---------

          Loss before reorganization costs              
           and income taxes                             (511,269)     (898,425)

Reorganization costs:
     Professional fees                                   (44,000)     (195,076)
                                                     -----------     ---------
          Loss before income taxes                      (555,269)   (1,093,501)

Provision for income taxes                                 --             --
                                                     -----------     ---------
          Net loss                                      (555,269)   (1,093,501)

Retained deficit, beginning of period                 (1,399,670)     (496,429)

Preferred stock dividend                                 (30,000)         --
                                                     -----------     ---------

Retained deficit, end of period                      $(1,984,939)   (1,589,930)
                                                     ===========     =========

Net loss per common share                            $      (.01)         (.06)
                                                     ===========     =========


See accompanying notes to condensed financial statements.


                                       -5-

<PAGE>



                        PEACHES ENTERTAINMENT CORPORATION
                       Condensed Statements of Cash Flows

           Six months ended September 27, 1997 and September 28, 1996
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                  September 27,      September 28,
                                                                                      1997               1996
                                                                                      ----               ----
<S>                                                                                <C>               <C>        
Cash flows from operating activities:                                                               
     Net loss                                                                      $  (555,269)      (1,093,501)
                                                                                   -----------      ----------- 
     Adjustments to reconcile net loss to net cash used in operating                                
        activities:                                                                                 
           Depreciation and amortization                                               131,400          151,884
           Deferred rent                                                               (22,477)          (8,673)
           Changes in assets and liabilities affecting cash flows from operating                    
               activities:                                                                          
                  (Increase) decrease in:                                                           
                    Inventories                                                         42,439        1,530,515
                    Prepaid expenses and other current assets                           62,098         (349,138)
                    Refundable income taxes                                               --               (702)
                    Other assets                                                        (6,277)          27,707
                  Increase (decrease) in:                                                           
                    Accounts payable                                                   384,761          555,463
                    Accrued liabilities                                                (83,408)         247,047
                    Liabilities subject to compromise                                     --         (1,693,812)
                                                                                   -----------      ----------- 
                        Net cash used in operating activities                          (46,733)        (633,210)
                                                                                   -----------      ----------- 
Cash flows from investing activities:                                                               
     Purchase of property and equipment                                                (31,304)         (31,547)
                                                                                   -----------      ----------- 
                        Net cash used in investing activities                          (31,304)         (31,547)
                                                                                   -----------      ----------- 
Cash flows from financing activities:                                                               
     Repayment of long-term obligations                                               (217,788)         (67,799)
     Dividends paid                                                                    (30,000)            --
     Due to parent                                                                      29,749             --
                                                                                   -----------      ----------- 
                        Net cash used in financing activities                         (218,039)         (67,799)
                                                                                   -----------      ----------- 
                        Net decrease in cash and cash equivalents                     (296,076)        (732,556)
                                                                                                    
Cash and cash equivalents, beginning of period                                       1,456,070        1,917,566
                                                                                   -----------      ----------- 
Cash and cash equivalents, end of period                                           $ 1,159,994        1,185,010
                                                                                   ===========      =========== 
Supplemental disclosures of cash flow information:                                                  
     Cash paid during the period for interest                                      $    38,811           36,931
                                                                                   ===========      =========== 
Supplemental disclosure of non-cash operating and investing  activities relating                  
     to the reorganization:

        Liabilities subject to compromise, March 30, 1996                                           $ 5,671,434

        Less:  inventory returns for credit                                                          (1,693,812)
                                                                                                    ----------- 
        Liabilities subject to compromise, September 28, 1996                                       $ 3,977,622
                                                                                                    ===========
</TABLE>


See accompanying notes to condensed financial statements.


                                       -6-

<PAGE>



                        PEACHES ENTERTAINMENT CORPORATION

                     Notes to Condensed Financial Statements



(1)  Basis of Financial Statement Presentation

     The  accompanying   unaudited  condensed  financial  statements  have  been
     prepared in accordance with the  instructions to Form 10-Q and,  therefore,
     do  not  include  all  footnotes  and  information  necessary  for  a  fair
     presentation of financial position, results of operations and cash flows in
     conformity with generally accepted accounting  principles.  However, in the
     opinion of management, all adjustments (consisting only of normal recurring
     accruals) necessary for a fair presentation have been made.

     It  is  suggested  that  the  accompanying  unaudited  condensed  financial
     statements be read in conjunction  with the financial  statements and notes
     included in the Peaches  Entertainment  Corporation (the "Company")  annual
     report on Form 10-K for the year ended March 29, 1997.

     As of September 27, 1997, the Company was an 93.5 percent-owned  subsidiary
     of URT Industries, Inc. (the "Parent").

     The results of operations for the six months ended  September 27, 1997, are
     not necessarily  indicative of the operating results to be expected for the
     year  ending  March  28,  1998.   The   Company's   business  is  seasonal.
     Historically, approximately 21 percent of the Company's sales have occurred
     in the second fiscal quarter.

     Inventories,  which consist of compact discs,  tapes and  accessories,  are
     stated at the lower of cost (principally average) or market.

     Certain  reclassifications  have been made to the (unaudited) September 28,
     1996 quarterly financial information to conform to the presentation used in
     the (unaudited) September 27, 1997 financial information.

(2)  Reorganization and Emergence From Chapter 11

     On  January  16,  1996  (the  "Petition   Date"),   Peaches   Entertainment
     Corporation  commenced  reorganization  proceedings under Chapter 11 of the
     United  States  Bankruptcy  Code.  An amended  plan of  reorganization  was
     confirmed by the  Bankruptcy  Court on January 17, 1997 (the  "confirmation
     date"),  and became  effective  February  3, 1997 (the  "effective  date"),
     subject to satisfaction of certain conditions which were satisfied February
     19, 1997.  All of the allowed claims were either paid on the effective date
     or are  reflected in current and  long-term  obligations  in the  financial
     statements,  payable  primarily  over a two year period from the  effective
     date.  The mortgage  holder will receive 100 percent of the allowed  claim,
     with interest,  except the balloon payment was extended from September 1997
     to September 2002.

(3)  Loss Per Common Share

     Net loss per common share was computed by dividing net loss, less preferred
     stock  dividends,  by the weighted  average  number of total common  shares
     outstanding during the periods.


                                       -7-

<PAGE>



                        PEACHES ENTERTAINMENT CORPORATION

                     Notes to Condensed Financial Statements



(4)  Income Taxes

     The Company follows Statement of Financial Accounting Standard ("SFAS") No.
     109,  Accounting  for Income Taxes.  The Company files a  consolidated  tax
     return with its Parent.  Any applicable tax charge or credits are allocated
     on a separate  return basis.  For the six month period ended  September 27,
     1997, there was no (benefit)  provision for income taxes as the Company has
     net operating loss carryforwards for federal income tax purposes.

(5)  New Accounting Pronouncements

     In  February  1997,  the FASB  issued  Statement  of  Financial  Accounting
     Standards No. 128, "Earnings Per Share" ("Statement 128"). Statement 128 is
     effective for financial statements issued for periods ending after December
     15, 1997. Statement 128 establishes  standards for computing and presenting
     earnings per share ("EPS"),  simplifies the standards  previously  found in
     APB  No.  15,   "Earnings   Per  Share,"  and  makes  them   comparable  to
     international  EPS  standards.  The Company  will begin  disclosing  EPS in
     accordance with Statement 128 beginning with the quarter ended December 27,
     1997.


                                       -8-

<PAGE>



                        PEACHES ENTERTAINMENT CORPORATION



Item 2. Management's Discussions and Analysis of Financial Condition and Results
        of Operations for the Six Months Ended September 27, 1997,  Compared  to
        the Six Months ended September 28, 1996.

From  time to  time,  the  Company  may make  certain  statements  that  contain
"forward-looking"  information (as defined in the Private Securities  Litigation
Reform  Act  of  1995).  Words  such  as  "believe,"  "anticipate,"  "estimate,"
"project" and similar expressions are intended to identify such  forward-looking
statements.  Forward-looking  statements may be made by management  orally or in
writing,  including,  but not  limited  to, in press  releases,  as part of this
Management's  Discussion  and  Analysis of  Financial  Condition  and Results of
Operations  and as a part of other  sections  of this  filing or other  filings.
Readers  are  cautioned  not to place undue  reliance  on these  forward-looking
statements,  which speak only as of their  respective  dates, and are subject to
certain risks, uncertainties and assumptions.  Should one or more of these risks
or uncertainties materialize,  or should any of the underlying assumptions prove
incorrect,  actual results of current and future  operations may vary materially
from those anticipated, estimated or projected.

Results of Operations

Net sales for the six months ended  September 27, 1997 (such six month period is
hereafter referred to as "1997") decreased by approximately 3.2 percent compared
to the six months ended  September  28, 1996 (such six month period is hereafter
referred to as "1996").  Such decrease is attributed to a decrease in comparable
store sales (3.2 percent).

The cost of sales for 1997 was lower  than  that for 1996 due  principally  to a
decrease in net sales.  Cost of sales as a percentage of net sales has decreased
from 64.7 percent in 1996 to 61.8 percent in 1997 primarily due to the fact that
the  Company  began to receive  discounts  associated  with  normal  trade terms
throughout  1997,  increases  in other  purchase  discounts  and an  increase in
certain retail selling prices.

Selling,  general and  administrative  (SG&A)  expenses in 1997 decreased by 9.0
percent  compared  to 1996.  Such  decrease  is  attributable  to a decrease  in
comparable  store expenses (5.1 percent),  and a decrease in corporate  overhead
(3.9  percent).  SG&A expenses as a percentage of net sales  decreased from 46.0
percent in 1996 to 43.3 percent in 1997 primarily due to overhead reductions.

Recently,  the Company's  primary suppliers have taken steps to help protect the
retail marketplace from certain low cost retailers of music. These steps include
not disbursing  cooperative  advertising  funds to retailers which engage in low
cost selling practices in violation of the minimum  advertised  pricing policies
of such suppliers.  Management  believes that such  initiatives,  in combination
with the other  factors  mentioned  above,  should  help the  Company to restore
itself to a  competitive  position in  subsequent  fiscal  years.  Other factors
which, in management's  opinion,  should help the Company to restore itself to a
competitive  position  in the  future are the  closing  of the six  unprofitable
stores which were closed during 1996, the closing of the former headquarters and
warehouse,  the  termination  of other  unprofitable  business  arrangements  as
described herein and  concentration on advantages which Peaches has over certain
of its competitors,  including large inventory, convenient store locations and a
high level of customer  service,  which  includes the ability of the customer to
sample virtually all music before purchasing and an extremely  efficient special
order program.


                                       -9-

<PAGE>


                        PEACHES ENTERTAINMENT CORPORATION


The Company incurred a net loss of  approximately  $555,000 in 1997 versus a net
loss of approximately  $1,094,000 in 1996. The significant reduction in net loss
is  attributed  to an  increase  in gross  profit  percentage  and a decrease in
expenses as discussed above.

Liquidity and Capital Resources

The Company had working  capital of $783,754 at September  27, 1997  compared to
working  capital of  $1,513,459 at March 29, 1997 and a current ratio (the ratio
of total current assets to total current  liabilities)  of 1.2 to 1 at September
27, 1997 compared to a current ratio of 1.5 to 1 at March 29, 1997.

At September 27, 1997,  the Company had  long-term  obligations  of  $1,091,663.
Management  anticipates that its ability to repay its long-term obligations will
be satisfied primarily through funds generated from its operations.

Management  anticipates that cash generated from operations and cash equivalents
on hand will provide  sufficient  liquidity to maintain adequate working capital
for operations.  Management would attempt to obtain financing for the opening of
any new stores during the next few years.

Inflation trends have not had an impact upon revenue because  increases in costs
have been passed along to customers.

The  Company's  business  is  seasonal  in nature,  with the  highest  sales and
earnings  occurring in the third fiscal  quarter,  which  includes the Christmas
selling season.

For  a  discussion  of  recent  developments  and  uncertainties  affecting  the
Company's  liquidity and capital  resources,  see notes 2 and 3 to the financial
statements  (Confirmation  of Amended Plan of  Reorganization  and Liquidity) on
Form 10-K for the year ended March 29, 1997.

In February 1997, the FASB issued Statement of Financial Accounting Standard No.
128,  "Earnings  Per Share"  ("Statement  128").  Statement 128 is effective for
financial  statements  issued  for  periods  ending  after  December  15,  1997.
Statement 128  establishes  standards for computing and presenting  earnings per
share  ("EPS"),  simplifies  the  standards  previously  found  in APB  No.  15,
"Earnings Per Share," and makes them comparable to International  EPS Standards.
The Company will begin disclosing EPS in accordance with Statement 128 beginning
with the quarter ended December 27, 1997.


                                      -10-

<PAGE>




                        PEACHES ENTERTAINMENT CORPORATION



PART II

Item 6. Exhibits and Reports on Form 8-K

     (a)  Exhibits

          27.0 Financial Data Schedule

     (b)  Reports on Form 8-K

          A Report on Form 8-K  dated  November  12,  1997 was filed on or about
          such date to report on the timing of this filing.


                                      -11-

<PAGE>




                        PEACHES ENTERTAINMENT CORPORATION



                                   SIGNATURES


Pursuant  to the  requirements  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.


                                    PEACHES ENTERTAINMENT CORPORATION           
                                    Registrant
                                   
                                   
Date: 12/3/97                       /s/ Allan Wolk
                                    --------------------------------------------
                                    Allan Wolk, Chairman of the Board, President
                                    (Principal Executive Officer)
                                   
                                   
                                   
                                   
Date: 12/3/97                       /s/ Jason Wolk       
                                    --------------------------------------------
                                    Jason Wolk, Executive Vice President,
                                    Chief Financial Officer
                                    (Principal Financial and Accounting Officer)