<PAGE>

================================================================================

                      SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON D.C. 20549

                                   FORM 10-Q

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

                 For the Quarterly Period Ended June 25, 2001

                                      OR

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



                     Commission file number(s) - 333-83637


                        AMERICAN MEDIA OPERATIONS, INC.

          (Exact name of the registrant as specified in its charter)
          ----------------------------------------------------------

                Delaware                                   59-2094424
   (State or other jurisdiction of            (IRS Employee Identification No.)
    incorporation or organization)

      5401 N.W. Broken Sound Blvd.,
         Boca Raton, Florida                                   33487
(Address of principal executive offices)                     (Zip Code)


       Registrant's telephone number, including area code (561) 997-7733


American Media Operations, Inc. (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, and (2) HAS BEEN subject to such filing requirements for
the past 90 days.

 As of August 9, 2001 there were 7,507 shares of common stock outstanding.

================================================================================

                                       1
<PAGE>

               AMERICAN MEDIA OPERATIONS, INC. AND SUBSIDIARIES
                              INDEX TO FORM 10-Q
                                 JUNE 25, 2001


<TABLE>
<CAPTION>
                                                                                                                          Page(s)
                                                  PART I. FINANCIAL INFORMATION                                           -------
<S>                                                                                                                       <C>
           Item 1. Financial Statements-
           Consolidated Balance Sheets..............................................................................         3
           Consolidated Statements of Income (Loss).................................................................         4
           Consolidated Statements of Comprehensive Income (Loss)...................................................         5
           Consolidated Statements of Cash Flows....................................................................         6
           Notes to Consolidated Financial Statements...............................................................        7-10

           Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations............       11-14

           Item 3. Quantitative and Qualitative Disclosures about Market Risk.......................................       14-15

                                                PART II. OTHER INFORMATION

           Item 6. Exhibits and Reports on Form 8-K.................................................................        16

           Signature.................................................................................................       17
</TABLE>

                                       2
<PAGE>

               AMERICAN MEDIA OPERATIONS, INC. AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS
                       As of June 25 and March 26, 2001
                     (in 000's, except share information)

<TABLE>
<CAPTION>
                                                                                    March 26, 2001                   June 25, 2001
                                                                                  -------------------            -------------------
                                       ASSETS                                                                          (Unaudited)
<S>                                                                               <C>                            <C>
CURRENT ASSETS:
  Cash and cash equivalents                                                            $      20,999                   $      3,221
  Receivables, net                                                                            25,412                         24,545
  Inventories                                                                                 14,101                         20,164
  Short term note receivable                                                                     322                            148
  Prepaid expenses and other                                                                   5,015                          5,121
                                                                                       -------------                   ------------
      Total current assets                                                                    65,849                         53,199
                                                                                       =============                   ============

PROPERTY AND EQUIPMENT, at cost:
  Land and buildings                                                                          10,076                         10,769
  Machinery, fixtures and equipment                                                           19,990                         22,887
  Display racks                                                                               35,380                         37,495
                                                                                       -------------                   ------------
                                                                                              65,446                         71,151
  Less - accumulated depreciation                                                            (18,651)                       (22,727)
                                                                                       -------------                   ------------
                                                                                              46,795                         48,424
                                                                                       -------------                   ------------
LONG TERM NOTE RECEIVABLE, net                                                                   427                            927
                                                                                       -------------                   ------------

DEFERRED DEBT COSTS, net                                                                      19,126                         18,472
                                                                                       -------------                   ------------

GOODWILL, net of accumulated amortization of $48,232 and $54,864                             482,256                        475,624
                                                                                       -------------                   ------------

OTHER INTANGIBLES, net of accumulated amortization of $56,275 and $63,962                    520,537                        512,850
                                                                                       -------------                   ------------
                                                                                       $   1,134,990                   $  1,109,496
                                                                                       =============                   ============
                         LIABILITIES AND STOCKHOLDER'S EQUITY
CURRENT LIABILITIES:
  Current portion of term loan                                                         $      14,281                   $     12,978
  Accounts payable                                                                            30,157                         19,310
  Accrued expenses                                                                            36,035                         23,002
  Deferred revenues                                                                           33,842                         30,353
                                                                                       -------------                   ------------
      Total current liabilities                                                              114,315                         85,643

PAYABLE TO PARENT COMPANY                                                                      2,110                          2,045
                                                                                       -------------                   ------------

LONG TERM DEBT:
  Term Loan and Revolving Credit Commitment, net of current portion                          415,719                        427,716
       10.25% Senior Subordinated Notes Due 2009                                             250,000                        250,000
       11.63% Senior Subordinated Notes Due 2004                                                 740                            740
       10.38% Senior Subordinated Notes Due 2002                                                 134                            134
                                                                                       -------------                   ------------
                                                                                             666,593                        678,590
                                                                                       -------------                   ------------

DEFERRED INCOME TAXES                                                                        165,479                        163,594
                                                                                       -------------                   ------------

CONTINGENCIES

STOCKHOLDER'S EQUITY:
       Common stock, $.20 par value; 7,507 shares issued and outstanding                           2                              2
       Additional paid-in capital                                                            223,298                        223,321
       Retained deficit                                                                      (36,807)                       (41,392)
       Accumulated other comprehensive income (loss)                                              --                         (2,307)
                                                                                       -------------                   ------------
       Total stockholder's equity                                                            186,493                        179,624
                                                                                       -------------                   ------------
                                                                                       $   1,134,990                   $  1,109,496
                                                                                       =============                   ============
</TABLE>

The accompanying notes to consolidated financial statements are an integral
                  part of these consolidated balance sheets.

                                       3
<PAGE>

               AMERICAN MEDIA OPERATIONS, INC. AND SUBSIDIARIES
              UNAUDITED CONSOLIDATED STATEMENTS OF INCOME (LOSS)
                                  (IN 000's)

<TABLE>
<CAPTION>
                                                              Fiscal Quarter           Fiscal Quarter
                                                                   Ended                   Ended
                                                               June 26, 2000           June 25, 2001
                                                            --------------------    -------------------
<S>                                                         <C>                     <C>
OPERATING REVENUES:
   Circulation                                                     $ 84,672               $ 84,458
   Advertising                                                        7,048                  8,851
   Other                                                              5,656                  4,436
                                                                   --------               --------
                                                                     97,376                 97,745
                                                                   --------               --------
OPERATING EXPENSES:
   Editorial                                                         10,046                 10,252
   Production                                                        24,865                 25,605
   Distribution, circulation and other cost of sales                 19,916                 19,536
   Selling, general and administrative expenses                      10,683                 10,498
   Depreciation and amortization                                     18,342                 19,311
                                                                   --------               --------
                                                                     83,852                 85,202
                                                                   --------               --------

   Operating Income                                                  13,524                 12,543

INTEREST EXPENSE                                                    (17,822)               (15,935)
OTHER INCOME, net                                                       187                     27
                                                                   --------               --------
   Loss before provision
    for income taxes                                                 (4,111)                (3,365)

PROVISION FOR INCOME TAXES                                             (891)                (1,220)
                                                                   --------               --------
   Net loss                                                        $ (5,002)              $ (4,585)
                                                                   ========               ========

</TABLE>

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

                                       4
<PAGE>

               AMERICAN MEDIA OPERATIONS, INC. AND SUBSIDIARIES
       UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
                                  (IN 000's)

<TABLE>
<CAPTION>
                                                                     Fiscal                  Fiscal
                                                                     Quarter                Quarter
                                                                      Ended                  Ended
                                                                     June 26,               June 25,
                                                                      2000                   2001
                                                                  -------------          -------------
<S>                                                               <C>                    <C>
Net loss                                                            $ (5,002)              $ (4,585)

Other comprehensive loss

          Interest rate swap adjustment (See Footnote 8)                  --                 (2,307)
                                                                  -------------          -------------

Other comprehensive loss                                                  --                 (2,307)
                                                                  -------------          -------------

Comprehensive loss                                                  $ (5,002)              $ (6,892)
                                                                  =============          =============
</TABLE>

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

                                       5
<PAGE>

               AMERICAN MEDIA OPERATIONS, INC. AND SUBSIDIARIES
                UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                  (IN 000's)

<TABLE>
<CAPTION>
                                                                                           Fiscal                    Fiscal
                                                                                           Quarter                   Quarter
                                                                                            Ended                     Ended
                                                                                        June 26, 2000             June 25, 2001
                                                                                       ----------------          ---------------
<S>                                                                                   <C>                       <C>
Cash Flows from Operating Activities:
  Net loss                                                                                $    (5,002)              $   (4,585)
                                                                                      ---------------           --------------
Adjustments to reconcile net loss to net cash
 used in operating activities -
    Reduction of allowance for doubtful accounts                                                   --                     (500)
    Gain on sale of assets                                                                         --                       (8)
    Depreciation and amortization                                                              18,342                   19,311
    Deferred debt cost amortization                                                               496                      654
    Non-cash compensation charge                                                                   --                       22
    Decrease (increase) in -
        Receivables, net                                                                         (823)                   1,041
        Inventories                                                                            (2,509)                  (6,063)
        Prepaid expenses and other                                                              2,077                     (106)
    Increase (decrease) in -
        Accounts payable                                                                          (98)                 (10,847)
        Accrued expenses                                                                      (11,140)                  (6,002)
        Accrued interest                                                                       (6,206)                  (7,008)
        Payable to Parent Company                                                              (1,732)                     (65)
        Accrued and current deferred income taxes                                                 891                   (3,321)
        Deferred revenues                                                                      (5,120)                  (3,489)
                                                                                      ---------------           --------------
          Total adjustments                                                                    (5,822)                 (16,381)
                                                                                      ---------------           --------------
                 Net cash used in operating activities                                        (10,824)                 (20,966)
                                                                                      ---------------           --------------

Cash Flows from Investing Activities:
         Capital expenditures                                                                  (3,790)                  (6,614)
         Acquisition of business, net of cash acquired                                         (6,127)                    (892)
                                                                                      ---------------           --------------
                 Net cash used in investing activities                                         (9,917)                  (7,506)
                                                                                      ---------------           --------------

Cash Flows from Financing Activities:
    Term loan and revolving credit commitment principal repayments                                 --                   (4,306)
    Proceeds from revolving credit commitment                                                      --                   15,000
                                                                                      ---------------           --------------
                  Net cash provided by financing activities                                        --                   10,694
                                                                                      ---------------           --------------

Net Decrease in Cash and Cash Equivalents                                                     (20,741)                 (17,778)
Cash and Cash Equivalents at Beginning of Period                                               23,404                   20,999
                                                                                      ---------------           --------------
Cash and Cash Equivalents at End of Period                                                $     2,663               $    3,221
                                                                                      ===============           ==============

Supplemental Disclosures of Cash Flow Information:
  Cash paid during the period for -
    Income taxes                                                                          $        --               $    4,309
    Interest                                                                                   22,122                   22,230
</TABLE>

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

                                       6
<PAGE>

               AMERICAN MEDIA OPERATIONS, INC. AND SUBSIDIARIES
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                 June 25, 2001
                         (000's omitted in all tables)
                                  (unaudited)


(1)  BASIS OF PRESENTATION

The accompanying unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q. There has been no
material change in the information disclosed in the notes to consolidated
financial statements included in the Annual Report on Form 10-K of American
Media Operations, Inc. and subsidiaries for the fiscal year ended March 26,
2001.

In the opinion of management, all adjustments considered necessary for a fair
presentation have been included herein. Operating results for the fiscal period
ended June 25, 2001 are not necessarily indicative of the results that may be
expected for future periods.

(2)  REVENUE RECOGNITION

Substantially all publication sales, except subscriptions, are made through
unrelated distributors. Issues, other than special topic issues, are placed on
sale approximately one week prior to the issue date; however, circulation
revenues and related expenses are recognized for financial statement purposes on
an issue date basis (i.e., off sale date). Special topic and monthly issues
revenue and related expenses are recognized at the on sale date. On the date
each issue is placed on sale, we receive a percentage of the issue's estimated
sales proceeds for our publications as an advance from the distributors. All of
our publications are sold with full return privileges.

Revenues from copy sales are net of reserves provided for expected sales
returns, which are established in accordance with generally accepted accounting
principles after considering such factors as sales history and available market
information. We continually monitor the adequacy of the reserves and make
adjustments when necessary.

Subscriptions received in advance of the issue date are recognized as income
over the term of the subscriptions as served. Advertising revenues are
recognized in the period in which the related advertising appears in the
publications.

        Deferred revenues were comprised of the following:

                                               March 26,        June 25,
                                                 2001             2001
                                             ------------     ------------
               Single Copy                       $10,139          $ 6,068
               Subscriptions                      23,176           24,048
               Advertising                           527              237
                                             ------------     ------------
                                                 $33,842          $30,353
                                             ============     ============

                                       7
<PAGE>

Other revenues, primarily from marketing services performed for third parties by
Distribution Services, Inc. ("DSI") and Frontline Marketing, Inc. ("FMI"), are
recognized when the service is performed. On November 27, 2000 the Company sold
its 80% owned subsidiary, FMI (see Note 7).



(3)  CERTAIN TRANSACTIONS AND MERGER

On May 7, 1999, all of the common stock of the Company's parent, American Media,
Inc. ("Media") was purchased by EMP Group LLC (the "LLC"), a Delaware limited
liability company, for $837 million pursuant to a merger of Media and EMP
Acquisition Corp. ("EMP"), a wholly owned subsidiary of the LLC (the
"Acquisition"). Proceeds to finance the Acquisition included (a) a cash equity
investment of $235 million by the LLC, (b) borrowings of $352 million under a
new $400 million senior bank facility (the "New Credit Facility") and (c)
borrowings of $250 million in the form of senior subordinated notes (the
"Notes"). These proceeds were used to (d) acquire all of the outstanding common
stock of Media for $299.4 million, (e) repay $267 million then outstanding under
the existing credit agreement with our banks (the "Prior Credit Agreement"), (f)
retire approximately $199.3 million of Senior Subordinated Notes due 2004 and
(g) pay transaction costs (collectively (a) through (g), the "Transactions").
Upon consummation of the Transactions, EMP was merged with and into Media (the
"Merger") resulting in a change in ownership control of both Media and the
Company.

The Acquisition has been accounted for under the purchase method of accounting
in accordance with Accounting Principles Board No. 16 ("APB No. 16"). The excess
of purchase price over the fair value of net tangible assets acquired has been
allocated between identified intangible assets including the value of the
tradenames and subscription lists of the Company's publications, as determined
through an independent appraisal, with the remainder allocated to goodwill. For
the Inception Period and thereafter, intangible assets, including goodwill, are
being amortized on a straight-line basis over 20 years for tradenames and
goodwill and 9-15 years for subscription lists. Goodwill for the period from
March 30, 1999 to May 6, 1999, was amortized on a straight-line basis over 40
years and intangible assets for the period was amortized on a straight-line
basis over 25 years.

On November 1, 1999, the Company acquired all of the common stock of Globe
Communications Corp. and certain of the publishing assets and liabilities of
Globe International, Inc. (collectively, the "Globe Properties") for total
consideration of approximately $105 million, including approximately $100
million in cash and $5 million in equity of the LLC (the "Globe Acquisition").
The Globe Properties consist of several tabloid style magazines, including
Globe, National Examiner and Sun as well as other titles including Mini Mags.
Proceeds to finance the acquisition of the Globe Properties included an
expansion of our existing senior bank facility of $90 million, approximately $14
million from the Company's existing revolving line of credit and the issuance of
$5 million of equity in the LLC. These proceeds were used to acquire the Globe
Properties and to pay transaction costs.

On July 11, 2000, the Company and the former owner of the Globe Properties
signed an agreement whereby the existing voting shareholders of the LLC
repurchased the $5 million of equity in the LLC originally issued to the former
owner. Concurrent with this purchase, the former owner and his son resigned
their positions as directors of the board of Media.

Additionally, in July 2000, the Company bought out the remaining term of the
former owner's five year employment agreement and collected the amount due per
the net asset calculation as required in the initial purchase agreement. The net
amount paid to the former owner for these items and miscellaneous other items
was approximately $3.2 million. This adjustment was a part of the Globe
Acquisition and was therefore accounted for as an increase in goodwill.

The Globe Acquisition has been accounted for under the purchase method of
accounting in accordance with APB No. 16, and accordingly, results of operations
are included in the financial statements from the date of acquisition, and the
assets and liabilities have been recorded based upon their fair values at the
date of acquisition. The excess

                                       8
<PAGE>

of purchase price over the fair value of net tangible assets acquired has been
allocated between identified intangible assets including the value of the
tradenames of the Company's publications, as determined through an independent
appraisal, with the remainder allocated to goodwill. During the quarter ended
December 25, 2000, the Company finalized the fair values of the assets and
liabilities acquired. Goodwill and tradenames related to the Globe Acquisition
are being amortized over 20 years on a straight-line basis.


(4)  INVENTORIES

Inventories are stated at the lower of cost or market. We use the first-in,
first-out (FIFO) cost method of valuation, which approximates market value.
Inventories are comprised of the following:

                                                   March 26,      June 25,
                                                     2001           2001
                                                  ---------      ---------
Raw materials - paper                               $ 8,559        $14,413
Finished product - paper, production
  and distribution costs of future issues             5,542          5,751
                                                  ---------      ---------
                                                    $14,101        $20,164
                                                  =========      =========

(5)  INCOME TAXES

The Company files a consolidated Federal income tax return with Media, and
calculates its income taxes on a separate return basis. Income taxes have been
provided based upon the Company's anticipated effective annual income tax rate.
In accordance with the Statement of Financial Accounting Standards ("SFAS") NO.
109, "Accounting for Income Taxes", deferred taxes are recognized for temporary
differences related to identified intangible assets other than goodwill. The
temporary difference is calculated based on the difference between the new book
bases of the amounts allocated to tradenames and subscription lists and their
historical tax bases. Accordingly, as of May 7, 1999, in connection with the
Acquisition, a deferred tax liability of approximately $162 million was recorded
with a corresponding increase in goodwill. Our effective income tax rate exceeds
the federal statutory income tax rate of 35% because of the effect of goodwill
amortization which is not deductible for income tax reporting purposes.


(6)  CREDIT AGREEMENT

As of June 25, 2001, the Company's effective interest rate on borrowings under
the New Credit Agreement was 8.2%. The effective rate for borrowings under the
New Credit Agreement averaged 8.2% for the fiscal quarter ended June 25, 2001.
The effective rate for borrowings under the new Credit Agreement averaged 9.8%
for the fiscal quarter ended June 26, 2000. In order to reduce our exposure to
interest rate risk, we entered into a $100.0 million interest rate swap
agreement which expired in November 2000 under which we paid a fixed rate of
5.95%. In November 2000, we entered into a new $90.0 million interest rate swap
agreement expiring in May 2002 under which we pay a fixed rate of 6.53%.

American Media Operations, Inc. has no material assets or operations other than
investments in its subsidiaries. The Notes are unconditionally guaranteed, on a
senior subordinated basis, by all of its subsidiaries. Each subsidiary that will
be organized in the future by the Company, unless such subsidiary is designated
as an unrestricted subsidiary, will jointly, severally, fully and
unconditionally guarantee the Notes on a senior subordinated basis. Note
guarantees are joint and several, full and unconditional and general unsecured
obligations of the note guarantors. The note guarantors are the Company's
subsidiaries. At present, the note guarantors comprise all of the Company's
direct and indirect subsidiaries. Note guarantees are subordinated in right of
payment to all existing and future senior debt of the note guarantors, including
the New Credit Facility, and are also effectively subordinated to all secured
obligations of note guarantors to the extent of the assets securing such
obligations, including the New Credit Facility. Furthermore, the Notes indenture
permits note guarantors to incur additional indebtedness, including senior debt,
subject to certain limitations. We have not presented separate

                                       9
<PAGE>

financial statements and other disclosures concerning each of the note
guarantors because management has determined that such information is not
material to investors.

So long as the factors set forth in the paragraph immediately above remain true
and correct, under applicable SEC rules and regulations, the Company's note
guarantors will not need to individually comply with the reporting requirements
of the Securities Exchange Act of 1934 ("Exchange Act"), nor will the Company
have to include separate financial statements and other disclosures concerning
each of the note guarantors in its Exchange Act reports.



(7)  SALE OF SUBSIDIARY

On November 27, 2000 the Company sold its 80% owned subsidiary, FMI, to the
minority shareholder for a $2.5 million note receivable ("The Note"). The Note
initially had a short-term component of $500,000 and a long-term component of
$2,000,000 which is payable to the Company based on defined cash flow of FMI.
The Note bears interest at 9%. Due to the uncertainty of FMI's ability to
generate defined cash flow for the repayment of The Note, the Company initially
reserved $1.6 million of The Note. No gain or loss was recognized on this
transaction. As of June 25, 2001, The Note's short-term balance was reduced to
$148,000 due to payments received from FMI. During the quarter ended June 25,
2001, the Company reversed $500,000 of the original $1.6 million reserve based
on management's belief that FMI will generate the cash flow to make future
payments on this amount. This amount is included in selling, general and
administrative expenses for the quarter ended June 25, 2001.

(8)  DERIVATIVES AND HEDGING - ADOPTION OF SFAS NOS. 133 AND 138

The Company adopted Statement of Financial Accounting Standards (SFAS) No. 133,
"Accounting for Derivative Instruments and Hedging Activities" and SFAS No. 138,
"Accounting for Certain Derivative Instruments and Certain Hedging Activities
(an amendment of FASB Statement No. 133)" on March 27, 2001. The Company reports
all derivative instruments on the balance sheet at their fair value. Changes in
the fair value of derivatives are recorded each period in earnings or
comprehensive income, depending on the designation of the derivative. Changes in
the fair value of derivatives that are not designated as a hedge are reported
immediately in earnings.

The Company documents all relationships between derivative hedging instruments
and hedged items, as well as its risk-management objective and strategy for
entering into various hedge transactions.

As a result of adopting SFAS No. 133, the Company recorded the fair market value
of $2,065,000 on March 27, 2001 and the change in the fair market value during
the quarter ended June 25, 2001 of $242,000 relating to their cash flow variable
debt hedge as a charge to Other Comprehensive Loss.

(9)  LITIGATION

Various suits and claims arising in the ordinary course of business have been
instituted against the Company. The Company has various insurance policies
available to recover potential legal costs incurred by it. The Company
periodically evaluates and assesses the risks and uncertainties associated with
litigation independent from those associated with its potential claim for
recovery from third party insurance carriers. At present, in the opinion of
management, after consultation with outside legal counsel, the liability
resulting from litigation, if any, will not have a material effect on the
Company's financial position and results of operations.

                                       10
<PAGE>

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

Results of Operations

Fiscal Quarter Ended June 25, 2001 vs Fiscal Quarter Ended June 26, 2000

Total operating revenues were $97,745,000 for the current fiscal quarter.
Operating revenues increased by $369,000, or 0.4%, from the prior year's
comparable fiscal quarter. Results in the current fiscal quarter reflect a loss
of revenue from discontinued/sold operations of $3.9 million. Circulation
revenue for continuing publications increased $2.3 million primarily due to
increased cover prices. Advertising revenues increased 25.6%, from $7.0 million
to $8.9 million, despite a weak industry-wide advertising climate.

Circulation revenues (which include all single copy and subscription sales) were
$84,458,000 for the current fiscal quarter. Circulation revenues decreased by
$214,000, or 0.3%, when compared to the prior year's comparable fiscal quarter.
Circulation revenue for continuing publications increased $2.3 million primarily
due to increased cover prices. These circulation gains were offset by the loss
of circulation revenues from discontinued/sold publications. Subscription
revenues were $8,789,000 for the current fiscal quarter. Subscription revenues
decreased by $18,000, or 0.2%, when compared to the prior year's comparable
fiscal quarter.

Advertising revenues were $8,851,000 for the current fiscal quarter. Advertising
revenues increased by $1,803,000, or 25.6%, when compared to the prior year's
comparable fiscal quarter. This increase is primarily due to additional
advertising revenues from our tabloids (National Enquirer and Star magazines --
$0.8 million), increased advertising revenues from MIRA! ($0.5 million) and
increased advertising in our Country Music Magazine Group ($0.5 million).

Total operating expenses for the current fiscal quarter increased by $1,350,000
when compared to the prior year's comparable fiscal quarter. Results in the
quarter reflect an increase of $1.4 million in T.V. advertising and promotional
expense in the current fiscal quarter versus the prior year's comparable fiscal
quarter.

Interest expense decreased for the current fiscal quarter by $1,887,000 to
$15,935,000 compared to the prior year's comparable fiscal quarter. This
decrease in interest expense relates to a lower average effective interest rate.
Additionally, as a result of adopting SFAS No. 133, the Company recorded the
current fiscal quarter interest rate swap expense of $429,000 to Other
Comprehensive Loss.

Our effective income tax rates exceed the federal statutory income tax rate of
35% because of the effect of goodwill amortization which is not deductible for
income tax reporting purposes.

     LIQUIDITY AND CAPITAL RESOURCES

We have substantially increased our indebtedness in connection with the
Transactions and the Globe Acquisition (see Note 3). As a result of the New
Credit Agreement and the Notes, our liquidity requirements have been
significantly increased, primarily due to increased interest and principal
payment obligations under the New Credit Agreement which, other than certain
excess cash flow payment obligations, will commence in fiscal 2002. We believe
that the net cash generated from operating activities and amounts available
under the $60.0 million revolving credit facility will be sufficient to fund our
debt service requirements under the New Credit Agreement and the Notes, to make
capital expenditures and to cover working capital requirements. As of August 9,
2001, there was $6.0 million outstanding on the revolving credit facility. We
believe, however, that based upon our current level of operations and
anticipated growth, it will be necessary to refinance the Notes upon their
maturity. To the extent we make future acquisitions, we may require new sources
of funding, including additional debt, or equity financing or some combination
thereof. There can be no assurances that such additional sources of funding will
be available to us on acceptable terms.

                                       11
<PAGE>

Our ability to make scheduled payments of principal and interest under the New
Credit Agreement and the Notes, as well as our other obligations and
liabilities, is subject to our future operating performance which is dependent
upon general economic, financial, competitive, legislative, regulatory, business
and other factors beyond our control.

At June 25, 2001, we had cash and cash equivalents of $3.2 million and a working
capital deficit of $32.4 million. We do not consider our working capital deficit
to be a true measure of our liquidity position as our working capital needs
typically are met by cash generated by our business. Our working capital
deficits result principally from:

 .  our policy of using available cash to reduce borrowings which are recorded as
   noncurrent liabilities, thereby reducing current assets without a
   corresponding reduction in current liabilities;

 .  our minimal accounts receivable level relative to revenues, as most of our
   sales revenues are received from national distributors as advances based on
   estimated single copy circulation; and

 .  accounting for deferred revenues as a current liability. Deferred revenues
   are comprised of deferred subscriptions, advertising and single copy revenues
   and represent payments received in advance of the period in which the related
   revenues will be recognized.

Historically, our primary sources of liquidity have been cash generated from
operations and amounts available under our credit agreements, which have been
used to fund shortfalls in available cash. Cash on hand on March 26, 2001 of
$21.0 million was used to fund working capital requirements (including interest
and tax payments of $26.5 million) as well as to fund capital expenditures.

We made capital expenditures in the fiscal quarters ended June 25, 2001 and June
26, 2000 totaling $6.6 million and $3.8 million, respectively.

At June 25, 2001, our outstanding indebtedness totaled $691.6 million, of which
$440.7 million represented borrowings under the New Credit Agreement. At August
9, 2001, our outstanding indebtedness totaled $679.4 million, of which $428.5
million represented borrowings under the New Credit Agreement. In connection
with the acquisition of the Globe Properties as discussed in Note 3. to the
Consolidated Financial Statements, we expanded our New Credit Agreement by $90
million. As of June 25, 2001, the Company's effective interest rate on
borrowings under the New Credit Agreement was 8.2%. The effective rate for
borrowings under the New Credit Agreement averaged 8.2% for the fiscal quarter
ended June 25, 2001. The effective rate for borrowings under the New Credit
Agreement averaged 9.8% for the fiscal quarter ended June 26, 2000. In order to
reduce our exposure to interest rate risk, we entered into a $100.0 million
interest rate swap agreement which expired in November 2000 under which we paid
a fixed rate of 5.95%. In November 2000, we entered into a new $90.0 million
interest rate swap agreement expiring in May 2002 under which we pay a fixed
rate of 6.53%.

We have no material assets or operations other than the investments in our
subsidiaries. The Notes are unconditionally guaranteed, on a senior subordinated
basis, by all of our subsidiaries. Each subsidiary that will be organized in the
future by us, unless such subsidiary is designated as an unrestricted
subsidiary, will jointly, severally, fully and unconditionally guarantee the
Notes on a senior subordinated basis. Note guarantees are joint and several,
full and unconditional and general unsecured obligations of the note guarantors.
The note guarantors are our subsidiaries. At present, the note guarantors
comprise all of our direct and indirect subsidiaries. Note guarantees are
subordinated in right of payment to all existing and future senior debt of the
note guarantors, including the New Credit Facility, and are also effectively
subordinated to all secured obligations of note guarantors to the extent of the
assets securing such obligations, including the New Credit Facility.
Furthermore, the Notes indenture permits note guarantors to incur additional
indebtedness, including senior debt, subject to certain limitations. We have not
presented separate financial statements and other disclosures concerning each of
the note guarantors because management has determined that such information is
not material to investors.

                                       12
<PAGE>

So long as the factors set forth in the paragraph immediately above remain true
and correct, under applicable SEC rules and regulations, we believe that note
guarantors will not need to individually comply with the reporting requirements
of the Exchange Act, nor will we have to include separate financial statements
and other disclosures concerning each of the note guarantors in its Exchange Act
reports.


Earnings before Interest, Taxes, Depreciation and Amortization ("EBITDA")

The following table and discussion summarizes EBITDA for the three months ended
June 25, 2001 and June 26, 2000.

                       Fiscal Quarter               Fiscal Quarter
                           Ended                        Ended
                       June 26, 2000                June 25, 2001
                    --------------------          -------------------

                       $31,866,000                    $31,854,000


The Company defines EBITDA as net income (loss) before extraordinary charges,
interest expense, income taxes, depreciation and amortization and other income
(expense). EBITDA is presented and discussed because the Company considers
EBITDA an important indicator of the operational strength and performance of its
business including the ability to provide cash flows to service debt and fund
capital expenditures. EBITDA, however, should not be considered an alternative
to operating or net income (loss), as an indicator of the performance of the
Company, or as an alternative to cash flows from operating activities as a
measure of liquidity, in each case determined in accordance with generally
accepted accounting principles ("GAAP").

New Accounting Pronouncements

In July 2001, the Financial Accounting Standards Board ("FASB") issued Statement
of Financial Accounting Standards No. 142, "Goodwill and Other Intangible
Assets" ("SFAS No. 142"). Under SFAS No. 142, goodwill is no longer subject to
amortization over its estimated useful life. Rather, goodwill is subject to an
annual assessment for impairment by applying a fair-value based test. The
standard is effective for fiscal years beginning after December 15, 2001. The
Company has yet to determine the impact of the standard on its financial
position and results of operations.

In June 1998, the FASB issued Statement of Financial Accounting Standards No.
133, "Accounting for Derivative Instruments and Hedging Activities" ("SFAS No.
133"). SFAS No. 133, as amended by SFAS No. 137, is effective for all fiscal
years beginning after June 15, 2000. The Company adopted SFAS No. 133 on March
27, 2001. As a result of this adoption, all derivatives are recognized on the
balance sheet at fair value. Changes in fair value of derivatives are recorded
each period in earnings or in other comprehensive income, depending on the
designation of the derivative. The Company does not engage in currency
speculation. The Company may, from time to time, enter into derivative
instruments to hedge against known or forecasted market exposures.

                                       13
<PAGE>

Forward-Looking Statements

Some of the information presented in this Form 10-Q constitutes forward-looking
statements, including, in particular, the statements about our plans, strategies
and prospects under the heading "Management's Discussion and Analysis of
Financial Condition and Results of Operations." We have based these
forward-looking statements on our current assumptions, expectations and
projections about future events. We caution you that a variety of factors could
cause business conditions and results to differ materially from what is
contained in the forward-looking statements. These forward-looking statements
are subject to risks, uncertainties and assumptions about us, including, among
other things:

<TABLE>
   <S>                                           <C>
   .  our high degree of leverage and            .  increasing competition by domestic
      significant debt service obligations,         and foreign media companies,

   .  our ability to increase circulation and    .   changes in the costs of paper used
      advertising revenues,                          by us,

   .  market conditions for our publications,    .   any future changes in management and

   .  our ability to develop new publications    .   general risks associated with the
      and services,                                  publishing industry.
</TABLE>


ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are exposed to certain market risks that are inherent in our financial
statements. We are subject to interest risk on our credit facilities and any
future financing requirements. Our fixed rate debt consists primarily of Senior
Subordinated Notes, as well as $90 million of interest rate swap agreements on
our term loan. The interest rate swap agreements effectively convert a portion
of our variable rate debt to fixed-rate debt. The interest rate swap agreement
which expired in November 2000 had a fixed interest rate of 5.95%. In November
2000, we entered into a new $90.0 million swap agreement expiring in May 2002
under which we pay a fixed rate of 6.53%.

                                       14
<PAGE>

The following table presents the future principal payment obligations and
weighted average interest rates associated with our existing credit instruments
assuming our actual level of indebtedness (in 000's):

<TABLE>
<CAPTION>
                                                     Fiscal Year Ended
                                      -----------------------------------------
                                         2002      2003      2004    Thereafter
                                         ----      ----      ----    ----------
<S>                                   <C>         <C>      <C>       <C>
Liabilities:

$250,000 Fixed Rate (10.25%)                 -          -         -    $250,000

$740 Fixed Rate (11.63%)                     -          -         -    $    740

$134 Fixed Rate (10.38%)                     -    $   134         -           -

Term Loan and Revolving Loan
Variable Rate (8.2% for the
   quarter ended June 25, 2001)        $12,978    $17,822   $22,667    $387,227
 Interest Rate Derivatives:
   Interest Rate Swaps:
     Variable to Fixed                 $90,000          -         -           -
     Average Pay Rate                    (6.53%)
     Average Receive Rate                (5.39%)
</TABLE>

Interest rate changes result in increases or decreases in our income before
taxes and cash provided from operating activities. A 1% change in our weighted
interest rate on our variable debt net of the effect of our interest rate swap
would result in a change of $877,000 in our interest expense for the three
months ended June 25, 2001.

Our primary market risk exposures relate to (1) the interest rate risk on
long-term and short-term borrowings, (2) our ability to refinance our Senior
Subordinated Notes at maturity at market rates, (3) the impact of interest rate
movements on our ability to meet interest expense requirements and comply with
financial covenants and (4) the impact of interest rate movements on our ability
to obtain adequate financing to fund acquisitions. We manage the interest rate
risk on our outstanding long-term and short-term debt through our use of fixed
and variable rate debt. While we cannot predict or manage our ability to
refinance existing debt or the impact interest rate movements will have on our
ability to refinance existing debt or the impact interest rate movements will
have on our existing debt, we continue to evaluate our financial position on an
ongoing basis.

                                       15
<PAGE>

PART II. OTHER INFORMATION
--------------------------

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

During the fiscal quarter ended June 25, 2001, the Company filed no reports on
Form 8-K.

                                       16
<PAGE>

                                    SIGNATURE


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 by the
undersigned, thereto duly authorized.

                                                AMERICAN MEDIA OPERATIONS, INC.
                                                -------------------------------
                                                Registrant


Date: August 9, 2001                            By /s/ JOHN A. MILEY
                                                --------------------
                                                John A. Miley
                                                Executive Vice President
                                                Chief Financial Officer

                                       17