<PAGE>   1
                       SECURITIES AND EXCHANGE COMMISSION

                              Washington, DC 20549

                                   FORM 10-QSB


(Mark One)

(x) Quarterly report under Section 13 or 15(d) of the Securities Exchange Act of
1934 for the quarter ended March 31, 1998.

( ) Transition report under Section 13 or 15(d) of the Securities Exchange Act
of 1934 for the period from _________________ to ______________.

Commission file number:  0-11744

                        Publishers Equipment Corporation
                        --------------------------------
        (Exact name of small business issuer as specified in its charter)


           Texas                                        75-1653425
           -----                                        ----------
 (State of incorporation)                  (I.R.S. Employer Identification No.)


   16660 Dallas Parkway, Suite 1100, Dallas, Texas         75248
   -----------------------------------------------         -----
      (Address of principal executive offices)           (zip code)

Registrant's telephone number, including area code:  972-931-2312


Check whether the issuer (1) 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
days.

                           YES     X                 NO
                                  ---                       ---

Number of shares outstanding of the issuer's common stock as of May 5, 1998,
5,220,253 shares of common stock, no par value.



Page 1 of 10 sequentially numbered pages.
<PAGE>   2
                         PART I -- FINANCIAL INFORMATION


Item 1.  FINANCIAL STATEMENTS

                          Index to Financial Statements


<TABLE>
<CAPTION>
                                                                         Page
                                                                         ----
<S>                                                                       <C>
Publishers Equipment Corporation Consolidated
  Balance Sheet                                                            3


Publishers Equipment Corporation Consolidated
  Statements of Operations                                                 4


Publishers Equipment Corporation Consolidated
  Statements of Cash Flows                                                 5


Publishers Equipment Corporation Notes to
  Consolidated Financial Statements                                        6
</TABLE>


In the opinion of management, the financial statements contained herein include
all adjustments, which adjustments are of a normal recurring nature, necessary
for a fair presentation of the Company's consolidated financial position and
results of operations and cash flows. Results of operations for the period ended
March 31, 1998, are not necessarily indicative of results of operations for the
entire year.











Page 2 of 10 sequentially numbered pages.
<PAGE>   3
                        PUBLISHERS EQUIPMENT CORPORATION
                           CONSOLIDATED BALANCE SHEET
                                 (In Thousands)
                                   (Unaudited)

<TABLE>
<CAPTION>
-------------------------------------------------------------------------------
                                                              March 31,
                                                                1998
-------------------------------------------------------------------------------
                                   ASSETS
<S>                                                         <C>    
Cash and cash equivalents ..............................     $     39
Accounts receivable ....................................          625
Inventories ............................................        9,696
Other current assets ...................................          166
                                                             --------
    Total current assets ...............................       10,526

Property, plant and equipment, net .....................        1,039
                                                             --------

TOTAL ASSETS ...........................................     $ 11,565
                                                             ========

                    LIABILITIES AND SHAREHOLDERS' EQUITY

Accounts payable and accrued liabilities ...............     $  1,613
Accrued warranty expense ...............................          311
Customer deposits ......................................        2,105
Short term debt ........................................        2,859
                                                             --------
    Total current liabilities ..........................        6,888

Convertible subordinated note ..........................        1,000
Other liabilities ......................................          150

Shareholders' equity:
    Preferred stock ....................................          200
    Common stock .......................................       19,114
    Treasury stock .....................................         (168)
    Retained deficit ...................................      (15,619)
                                                             --------
       Total shareholders' equity ......................        3,527
                                                             --------

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY .............     $ 11,565
                                                             ========

               See accompanying notes
</TABLE>




Page 3 of 10 sequentially numbered pages.
<PAGE>   4
                        PUBLISHERS EQUIPMENT CORPORATION
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                (In Thousands Except Share and Per Share Amounts)
                                   (Unaudited)


<TABLE>
<CAPTION>
-------------------------------------------------------------------------------
                                                      Three Months Ended
                                                          March 31,
                                                     1998           1997
-------------------------------------------------------------------------------
<S>                                             <C>             <C>
Revenues .....................................     $     1,966      $     2,456

Cost of revenues .............................           1,448            1,716
                                                   -----------      -----------

Gross profit .................................             518              740

Selling, general and administrative expense...             566              555
                                                   -----------      -----------

Operating profit (loss) ......................             (48)             185

Interest expense .............................             (83)             (77)
Interest income ..............................              --                2
Other expense, net ...........................             (10)              (9)
                                                   -----------      -----------

Income (loss) before taxes ...................            (141)             101

Provision for income taxes (Note 1) ..........              --               --
                                                   -----------      -----------

Net income (loss) ............................     $      (141)     $       101
                                                   ===========      ===========

Weighted average shares outstanding:
      Basic ..................................       5,220,253        5,205,719
      Diluted ................................       5,287,662        5,249,321

Earnings (loss) per share (Note 2):
      Basic ..................................           (0.03)            0.02
      Diluted ................................           (0.03)            0.02

  See accompanying notes
</TABLE>



Page 4 of 10 sequentially numbered pages
<PAGE>   5
                        PUBLISHERS EQUIPMENT CORPORATION
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (In Thousands)
                                   (Unaudited)

<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------
                                                                    Three Months Ended
                                                                        March 31,
                                                                    1998          1997
-------------------------------------------------------------------------------------------
<S>                                                             <C>          <C>
Cash flows from operating activities:
   Net income (loss) from operations .......................     $  (141)     $   101      
Adjustments to reconcile net income (loss) to                                              
     net cash used in operating activities:                                                
           Depreciation and amortization ...................          45           53      
           Provision for losses on doubtful accounts .......           8            8      
                                                                                           
Change in assets and liabilities:                                                          
           Decrease in accounts receivable .................         753          380      
           Increase in inventories .........................      (1,439)        (251)     
           Increase in other current assets ................         (46)         (24)     
           Decrease in accounts payable and                                                
                 accrued liabilities .......................        (737)        (279)     
           Decrease in accrued warranty expense ............         (80)         (18)     
           Increase (decrease) in customer deposits ........         937          (65)     
                                                                 -------      -------      
   Net cash used in operations .............................        (700)         (95)     
                                                                                           
Cash flows from investing activities:                                                      
           Retirements of property, plant and equipment.....          --           10      
           Additions to property, plant and equipment.......          (4)          --      
                                                                 -------      -------      
   Net cash provided by (used in) investing activities                (4)          10      
                                                                                           
Cash flow from financing activities:                                                       
      Total borrowings .....................................       2,462        1,531      
      Total repayments .....................................      (1,757)      (1,507)     
                                                                 -------      -------      
   Net cash provided by financing activities ...............         705           24      
                                                                                           
Net increase (decrease) in cash and cash equivalents .......           1          (61)     
                                                                                           
Cash and cash equivalents at beginning of period ...........          38          148      
                                                                 -------      -------      
                                                                                           
Cash and cash equivalents at end of period .................     $    39      $    87      
                                                                 =======      =======
                See accompanying notes.
</TABLE>


Page 5 of 10 sequentially numbered pages.
<PAGE>   6
PUBLISHERS EQUIPMENT CORPORATION

                   Notes to Consolidated Financial Statements
                                   (unaudited)


1.       The income tax provision for the three month period ended March 31,
         1997, of $34,000 was offset entirely by a corresponding tax benefit
         related to the reversal of previously unrecognized temporary
         differences, primarily net operating loss carryforwards.

2.       The Company adopted Statement of Financial Accounting Standards (SFAS)
         No. 128, "Earnings Per Share", effective December 31, 1997, and all
         earnings per share amounts disclosed herein have been calculated under
         the provisions of SFAS No. 128. Basic earnings per share were computed
         by dividing net income by the weighted average number of shares of
         common stock outstanding during the reporting period. Diluted earnings
         per common share were determined on the assumed exercise of dilutive
         options and the assumed conversion of convertible preferred stock, as
         determined by applying the treasury stock method.









Page 6 of 10 sequentially numbered pages.
<PAGE>   7

        MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND
                             RESULTS OF OPERATIONS

The Company serves the printing industry worldwide with new and remanufactured
single-width, web-fed offset printing equipment through its wholly owned
subsidiary King Press Corporation. Its products meet the needs of printers and
publishers, and range from cost effective presses for newspaper production to
heatset equipment that meet the high quality requirements of commercial
printers. The Company's customer base includes a broad range of small
newspapers, commercial and semi-commercial printers.

                              Results of Operations

Three Months Ended March 31, 1998

REVENUES. Revenues of $1,966,000 for the first quarter of 1998 compare to
$2,456,000 for the first quarter of 1997, reflecting a decrease of approximately
20 percent in both domestic and foreign revenues in the current quarter. The
reduction of revenues in the current quarter is attributable primarily to the
delivery schedule for equipment orders in backlog at year end 1997. Equipment
orders scheduled for delivery in the second quarter of 1998 will produce
revenues that bring the year to date total for 1998 above the level of the first
half of 1997.

GROSS PROFIT. Gross profit for the first quarter of 1998 of $518,000, or 26.3
percent of revenues, compares to $740,000, or 30.1 percent of revenues, for the
first quarter of 1997. The reduction in gross profit expressed as a percent of
revenues in the current quarter results from a larger component of equipment
installation activities in the business mix of the first quarter of 1998 than
occurred during the first quarter of 1997. The Company recognizes revenues
separately for the installation of equipment sold under contract, and the profit
margin on installation activities is lower than the profit margin earned on the
equipment sold.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSE. Selling, general and administrative
expense of $566,000, or 28.8 percent of revenues, for the first quarter of 1998
compares to $555,000, or 22.6 percent of revenues, for the first quarter of
1997. The increase in selling, general and administrative expense expressed as a
percent of revenues in the current quarter is a result of the lower level of
revenues in the current period.

OTHER INCOME (EXPENSE). Interest expense of $83,000 for the first quarter of
1998 compares to $77,000 for the first quarter of 1997, and is attributable
primarily to borrowings under the King Press Corporation revolving line of
credit. Net other expense of $10,000 for the first quarter of 1998 compares to
net other expense of $9,000 for the first quarter of 1997.

PROVISION FOR TAX. The Company utilized available net operating loss
carryforwards to offset federal and state income tax liabilities for the first
quarter of 1997 (See Note 1 of Notes to Consolidated Financial Statements).



Page 7 of 10 sequentially numbered pages.
<PAGE>   8
NET LOSS. A net loss of $141,000, or 7.2 percent of revenues, for the first
quarter of 1998 compares to net income of $101,000, or 4.1 percent of revenues,
for the first quarter of 1997.



                        Financial Position and Liquidity

The Company's wholly-owned operating subsidiary King Press Corporation is
supported by a secured $3,500,000 line of credit that expires May 31, 1998. The
loan agreement pertaining to the revolving line of credit includes restrictions
on indebtedness, liens and the disposal of assets. At March 31, 1998, King Press
Corporation had $2,859,000 outstanding under the line of credit and was in
compliance with all provisions of the loan agreement.

The Company is completing arrangements with its present lender for an increased
line of credit that will be restructured to fund its working capital needs as
well as its capital expenditure requirements. The Company has requested an
extension of its present line of credit beyond May 31, 1998 if required to
complete the restructuring.

The Company's backlog at March 31, 1998, totaled approximately $10,473,000
compared to approximately $6,629,000 at December 31, 1997. Included in backlog
for both periods is a $3.3 million equipment order for a customer in Saudi
Arabia that was placed on hold by the Company in the fourth quarter of 1997 when
the customer requested a restructuring of the contract payment schedule. The
Company believes that payment terms and a rescheduled delivery date satisfactory
to both parties can be agreed upon. Until such time, work on the contract will
remain on hold and the Company will continue to evaluate other sales
opportunities for the equipment manufactured.








Page 8 of 10 sequentially numbered pages.
<PAGE>   9
PART II -- OTHER INFORMATION

Item 1.  Legal Proceedings.

                  The Company and its subsidiaries from time to time become
                  involved in various claims and lawsuits incidental to their
                  businesses. In the opinion of management of the Company, any
                  ultimate liability arising out of currently pending claims and
                  lawsuits will not have a material adverse effect on the
                  consolidated financial condition or results of operations of
                  the Company.

Item 2.  Changes in Securities.

                  Not Applicable.

Item 3.  Defaults upon Senior Securities.

                  Not Applicable.

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

                  Not Applicable

Item 5.  Other Information.

                  Not Applicable.

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

                  Not Applicable.







Page 9 of 10 sequentially numbered pages.
<PAGE>   10
                                   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.


                        PUBLISHERS EQUIPMENT CORPORATION


May 5, 1998                             By: /s/ Roger R. Baier
                                            ------------------------------
                                            Roger R. Baier
                                            Vice President Finance &
                                            Treasurer
                                            (Principal Financial Officer)









Page 10 of 10 sequentially numbered pages.
<PAGE>   11
                               INDEX TO EXHIBITS


<TABLE>
<CAPTION>
Exhibit
Number                   Description
------                   -----------
<S>                  <C>
27                   Financial Data Schedule
</TABLE>