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

                                    FORM 10-Q


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

For the quarter ended June 30, 2002



                       COMMISSION FILE NUMBER: 333-12995

                          ABC FAMILY WORLDWIDE, INC.


              DELAWARE                                  95-4596247
   (State or other jurisdiction of                   (I.R.S. Employer
   incorporation or organization)                   Identification No.)

                          500 SOUTH BUENA VISTA STREET
                           BURBANK, CALIFORNIA 91521

      Registrant's Telephone Number, Including Area Code: (818) 560-1000

      Check whether the issuer (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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 |_|
      Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date: As of August 1, 2002, there
were 160,000 shares of Class A Common Stock outstanding and 15,840,000 shares of
Class B Common Stock outstanding.


<PAGE>


                          PART I. FINANCIAL INFORMATION

                           ABC FAMILY WORLDWIDE, INC.
                      (FORMERLY FOX FAMILY WORLDWIDE, INC.)

                    CONDENSED CONSOLIDATED BALANCE SHEETS
                 (unaudited; in thousands, except share data)


<TABLE>
<CAPTION>
<S>                                             <C>           <C>
                                                 June 30,     September
                                                    2002         30, 2001

                                                ------------  -----------
Assets:
Cash and cash equivalents.......................$   100,798   $   78,453
Restricted cash.................................      8,229        8,227
Accounts receivable.............................    139,517      147,122
Amounts receivable from related parties.........     14,536      126,213
Programming costs...............................    362,229      656,795
Property and equipment, net.....................     34,686       44,760
Deferred income taxes...........................     44,576        3,228
Intangible assets, net..........................  1,400,145    1,430,536
Other assets....................................     28,213       34,367
                                                ------------  -----------
  Total assets..................................$ 2,132,929   $ 2,529,701
                                                ============  ===========

Liabilities and stockholders' deficit:
Accounts and taxes payable......................$    58,895   $   72,430
Accrued liabilities ............................    117,184      159,009
Accrued programming costs.......................    140,907      146,959
Deferred revenues...............................     20,910       33,928
Accrued participations..........................     27,559       33,337
Deferred income taxes...........................     44,577       17,591
Bank and other debt.............................    858,196    1,507,071
Amounts payable to related parties..............  1,243,344      400,949
                                                ------------  -----------
  Total liabilities.............................  2,511,572    2,371,274
                                                ------------  -----------
  Commitments and contingencies:

Series A Mandatorily  Redeemable Preferred
Stock, $0.001 par value;
  500,000 shares authorized; 345,000 shares
  issued and outstanding at September
  30, 2001 and June 30, 2002, respectively
  ($1,000 per share liquidation value) .........    345,000      345,000
                                                ------------  -----------

 Minority interest...............................    51,240       48,841
                                                ------------  -----------

Stockholders' deficit:
  Preferred   Stock,   $0.001  par  value;
   2,000,000  shares  authorized  of which
   500,000   shares  are   designated   as               --           --
   Series A  Preferred  Stock;  no  shares
   issued or outstanding........................
  Class A Common Stock,  $0.001 par value;
      2,000,000 shares
   authorized;  160,000  shares issued and
   outstanding  at September  30, 2001 and                            --
   June 30, 2002, respectively..................         --
  Class B Common Stock,  $0.001 par value;
      16,000,000 shares
   authorized,  15,840,000  shares  issued
   and  outstanding  at September 30, 2001
   and June 30, 2002, respectively..............         16           16
  Contributed capital...........................     78,671       78,671
  Accumulated other comprehensive loss..........     (7,468)      (8,618)
  Deficit.......................................   (846,102)    (305,483)
                                                ------------  -----------
   Total stockholders' deficit..................   (774,883)    (235,414)
                                                ------------  -----------
   Total   liabilities  and  stockholders'
    deficit.....................................$ 2,132,929   $2,529,701
                                                ============  ===========


</TABLE>



           See notes to condensed consolidated financial statements


<PAGE>


                           ABC FAMILY WORLDWIDE, INC.,
                      (FORMERLY FOX FAMILY WORLDWIDE, INC.)

               CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                          (unaudited; in thousands)
<TABLE>
<CAPTION>
<S>                                 <C>        <C>         <C>        <C>


                                         Three Months           Nine Months
                                        Ended June 30,         Ended June 30,
                                     --------------------   -------------------
                                         2002      2001       2002       2001
                                     ---------  ---------   ---------  --------
 Revenues...........................$  139,163 $ 202,840   $ 386,030  $ 567,266
 Costs and expenses:
   Production and programming.......   (63,428)  (98,466)   (172,915)  (249,966)
   Selling,general and administrative  (67,753)  (56,479)   (190,926)  (160,974)
   Depreciation.....................    (2,272)   (3,928)     (6,390)    (8,933)
   Amortization of intangible assets   (10,131)  (10,130)    (30,391)   (30,391)
   Acquisition charges..............     2,187        --    (361,602)        --
 Interest expense, net..............   (53,401)  (44,449)   (139,540)  (129,668)
 Equity in earnings of affiliates....      132       270         738      1,821

 Minority interests..................   (1,045)      256      (2,399)        48
                                     ----------  --------   ---------  ---------
 Loss before income taxes............  (56,548)  (10,086)   (517,395)   (10,797)
 Income taxes........................       --        --          --         --
                                     ----------  ---------  ---------  ---------
 Net loss.................... . . . $  (56,548) $(10,086)  $(517,395) $ (10,797)
                                     ==========  =========  =========  =========


</TABLE>
































           See notes to condensed consolidated financial statements


<PAGE>


                           ABC FAMILY WORLDWIDE, INC.
                      (FORMERLY FOX FAMILY WORLDWIDE, INC.)

               CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                           (unaudited; in thousands)

<TABLE>
<CAPTION>
<S>                                                  <C>             <C>
                                                         Nine Months Ended
                                                              June 30,
                                                       ------------  -----------
                                                           2002        2001
                                                       ------------  -----------
OPERATING ACTIVITIES:
Net loss..........................................   $   (517,395)   $  (10,797)
Adjustments  to reconcile net loss to net cash
used in operating activities:
     Depreciation.................................          6,390         8,933
     Amortization of intangibles..................         30,391        30,391
     Non-cash acquisition charges.................        313,594            --
     Loss on debt repayment.......................         12,807            --
     Equity in earnings of affiliates.............           (738)       (1,821)
     Minority interest in share of earnings.......          2,399           (48)
     Changes in operating assets and liabilities..          2,164       (49,471)
                                                        -----------  ----------
            Net cash used in operating activities.       (150,388)      (22,813)
                                                        -----------  ----------

INVESTING ACTIVITIES:
Purchase of property and equipment................         (3,180)      (10,818)
Other...................................................      (93)       (1,197)
                                                        -----------  ----------
            Net cash used in investing activities.         (3,273)      (12,015)
                                                        -----------  ----------

FINANCING ACTIVITIES:
Proceeds from bank borrowings.....................            339        31,920
Paydown on bank borrowings........................       (468,396)       (1,054)
Paydown on NAI Bridge Loan........................             --          (202)
Dividends on Preferred Stock......................        (23,224)      (23,225)
Paydowns on senior notes and senior discount notes....   (197,870)           --
Advances from related parties.....................        865,157         1,052
                                                        -----------  ----------
            Net cash provided by financing activities.    176,006         8,491
                                                        -----------  ----------

Increase (decrease) in cash and cash equivalents..         22,345       (26,337)
Cash and cash equivalents at beginning of period..         78,453       112,664
Cash and cash equivalents at end of period........      -----------  ----------
                                                      $   100,798  $     86,327
                                                        ===========  ==========

</TABLE>

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





















           See notes to condensed consolidated financial statements


<PAGE>


                           ABC FAMILY WORLDWIDE, INC.
                      (FORMERLY FOX FAMILY WORLDWIDE, INC.)

                NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                            (unaudited; in thousands)

1. The accompanying unaudited condensed consolidated financial statements of ABC
Family Worldwide, Inc., formerly known as Fox Family Worldwide, Inc. (the
Company) have been prepared in accordance with accounting principles generally
accepted in the United States (GAAP) for interim financial information and in
accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X.
Accordingly, they do not include all of the information and footnotes required
by GAAP for complete financial statements. In the opinion of management, all
adjustments (consisting of normal recurring adjustments) considered necessary
for a fair presentation have been included. Certain prior-year amounts have been
reclassified to conform to the current year presentation. Operating results for
the nine-month period ended June 30, 2002 are not necessarily indicative of the
results that may be expected for the year ending September 30, 2002.

     As discussed in Note 2, the Company was acquired by The Walt Disney Company
(Disney) on October 24, 2001. These interim unaudited condensed consolidated
financial statements continue to reflect the Company's historical cost basis of
accounting and do not reflect the push-down of any fair value adjustments made
by Disney in its accounting for the acquisition. The Company continues to have
outstanding publicly traded debt securities and, accordingly, continues to
report its financial statements prepared on a basis consistent with periods
prior to the acquisition by Disney.

     These interim unaudited condensed consolidated financial statements and the
notes thereto should be read in conjunction with the audited consolidated
financial statements and notes thereto included in the Company's Annual Report
on Form 10-K for the year ended June 30, 2001, and the Company's Transition
Report on Form 10-Q for the transition period from July 1, 2001 to September 30,
2001.

     The preparation of the unaudited condensed consolidated financial
statements in conformity with GAAP requires management to make estimates and
assumptions that affect the amounts reported in the unaudited condensed
consolidated financial statements and accompanying notes. Actual results could
differ from those estimates. Management periodically reviews and revises its
estimates of future broadcast airings and revenues, as necessary, which may
result in revised amortization of its programming costs. Results of operations
may be significantly affected by the periodic adjustments in such amortization.

2. On October 24, 2001, Disney completed its previously announced acquisition of
all of the outstanding common stock of the Company.

     In connection with the acquisition by Disney, the Company repaid $467.0
million of borrowings under its credit facility and the facility was terminated.
This payment was funded by an advance from Disney totaling $522.4 million.
Additionally, Disney paid certain subordinated borrowings that the Company had
with one of its former shareholders and other advances totaling $394.3 million
on the Company's behalf. These amounts are now reported in amounts payable to
related parties.

     In addition, pursuant to the closing of the acquisition and in accordance
with the terms of their respective employment agreements, the Company made cash
payments totaling $74.1 million to Company stock option holders for the vested
option shares held by each option holder. There are no more options outstanding.
The stock option expense related to these options had been previously recorded
by the Company prior to the Disney acquisition.



<PAGE>


                           ABC FAMILY WORLDWIDE, INC.
                      (FORMERLY FOX FAMILY WORLDWIDE, INC.)

             NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                            (unaudited; in thousands)

     Immediately following the closing of the acquisition, the Company ceased to
broadcast the Fox Kids Network (FKN), which is now operated by Fox Broadcasting
Company (Fox). The Company is providing, under a licensing fee agreement,
certain programming to Fox for the 2001-2002 broadcast season for broadcast on
FKN.

     On October 24, 2001, Moody's Investor Service announced that it had
upgraded the Company's senior unsecured notes due in 2007 to Baa1 from B1
following the completion of the acquisition of the company by Disney. In
addition, Standard & Poor's announced that it had raised the Company's senior
unsecured debt rating from B to A-, following the completion of the acquisition.
As a result of these ratings upgrades, certain debt covenants no longer apply.

     During the nine months ended June 30, 2002, the Company recorded
acquisition charges totaling $361.6 million, due primarily to changes in its
strategic direction resulting from the acquisition by Disney. The charges were
primarily for write-offs of programming that, under Disney management, will not
be utilized. Management is in the process of finalizing its review of the
Company's operations and additional acquisition charges may be recorded.
Additionally, the charges included employee related severance costs, one-time
acquisition bonuses to certain Company executives, fixed asset write-downs and
leasehold termination costs for facilities that will not be used.

     The Company will now file consolidated federal income tax returns with
Disney. The Company determines its federal tax liability principally on a
separate company basis and pays any liability to Disney. State tax returns are
filed on an individual company basis except for certain states where they are
filed on a combined basis with Disney. The Company determines its state tax
liability for those combined states on a separate company basis and pays any
liability to Disney.

3. As of June 30, 2002, the Company had amounts payable to Disney totaling
approximately $1.24 billion. These amounts represent the repayment by Disney of
subordinated borrowings that the Company had with one of its former shareholders
and amounts loaned to the Company by Disney, subsequent to the acquisition,
under certain revolving credit agreements. Additionally, amounts payable to
Disney include funds advanced by Disney for operating needs. The revolving
credit agreements provide for borrowings totaling $2.6 billion and expire in
fiscal 2007. As of June 30, 2002, there were $777.3 million of borrowings
outstanding under the revolving credit agreements and approximately $1.8 billion
was available. The borrowings are due on October 23, 2006, and the Company may
make prepayments of the outstanding principal amount without premiums or
penalty. The borrowings bear interest at the Eurocurrency rate, as defined, and
are payable semi-annually. Interest expense for both the subordinated and
revolving borrowings totaled $41.7 million for the nine month period ended June
30, 2002 reflecting an effective interest rate of approximately 7%.



<PAGE>


                           ABC FAMILY WORLDWIDE, INC.
                      (FORMERLY FOX FAMILY WORLDWIDE, INC.)

             NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                            (unaudited; in thousands)

4. The operating segments reported below are the segments of the Company for
which separate financial information is available and for which segment
operating income or loss amounts are evaluated regularly by management in
deciding how to allocate resources and in assessing performance.
<TABLE>
<CAPTION>
<S>                               <C>         <C>       <C>         <C>

                                      Three Months           Nine Months
                                     Ended June 30,         Ended June 30,
                                  --------------------  ---------------------
                                    2002        2001       2002        2001
                                  --------    --------  ---------   ---------
Revenues:
   Broadcasting                   $ 109,481   $ 121,894 $ 305,045   $ 361,155
   Production and Distribution       29,682      80,946    80,985     206,111
                                   --------    --------  --------    ---------
                                  $ 139,163   $ 202,840 $ 386,030   $ 567,266
                                   ========    ========  =========   =========
Segment operating income (loss):
   Broadcasting                   $  21,848   $  20,505 $  51,623   $  73,806
   Production and Distribution      (14,745)     23,356   (30,502)     72,522
                                   --------    --------  --------    ---------
                                  $   7,103   $  43,861 $  21,121   $ 146,328
                                   ========    ========  =========   =========
</TABLE>

     The Company evaluates the performance of its operating segments based on
segment operating income. A reconciliation of segment operating income to loss
before income taxes is as follows:
<TABLE>
<CAPTION>
<S>                               <C>         <C>         <C>         <C>

                                     Three Months             Nine Months
                                     Ended June 30,          Ended June 30,
                                  --------------------    --------------------
                                     2002       2001        2002        2001
                                  ---------   --------    --------    --------
Segment operating income          $   7,103   $  43,861   $  21,121   $ 146,328
Corporate and unallocated
  shared expenses                    (1,393)        106      (5,322)      1,065
Amortization of intangible assets   (10,131)    (10,130)    (30,391)    (30,391)
Acquisition charges                   2,187           -    (361,602)          -
Interest expense, net               (53,401)    (44,449)   (139,540)   (129,668)
Equity in earnings of affiliates        132         270         738       1,821
Minority interests                   (1,045)        256      (2,399)         48
                                   ---------   --------    --------    --------
Loss before income taxes          $ (56,548)  $ (10,086)  $(517,395)  $ (10,797)
                                   =========   ========    ========    ========
</TABLE>

5.       Comprehensive loss for the three months and nine months ended June
30, 2002 and 2001, are as follows:
<TABLE>
<CAPTION>
<S>                               <C>        <C>         <C>         <C>

                                      Three Months            Nine Months
                                     Ended June 30,         Ended June 30,
                                  ---------------------  ----------------------
                                     2002        2001        2002       2001
                                  ---------   ---------   ---------  ----------
Net loss                          $  (56,548) $ (10,086)  $(517,395)  $ (10,797)
Foreign  currency   translation
  adjustment                           1,608     (1,145)      1,150      (1,044)
                                  ---------   ---------   ---------  -----------
Comprehensive loss                $  (54,940) $  (11,231) $(516,245)  $ (11,841)
                                  ==========  =========   =========   ==========
</TABLE>



<PAGE>


                           ABC FAMILY WORLDWIDE, INC.
                      (FORMERLY FOX FAMILY WORLDWIDE, INC.)

             NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                            (unaudited; in thousands)

6.   In July 2001, the Financial Accounting Standards Board (FASB)
issued Statement of Financial Accounting Standards  (SFAS) No. 141, Business
Combinations (SFAS 141) and Statement of Financial Accounting Standards No.
142, Goodwill and Other Intangible Assets (SFAS 142). The Board also issued
SFAS No. 143, Accounting for Obligations Associated with the Retirement of
Long-Lived Assets (SFAS 143), and SFAS No. 144, Accounting for the Impairment
or Disposal of Long-Lived Assets (SFAS 144), in August and October 2001,
respectively. In April 2002, the FASB issued SFAS No. 145, Rescission of FASB
Statements No. 4, 44 and 64, Amendment of FASB Statement No. 13, and
Technical Corrections as of April 2002 (SFAS 145) and in June 2002, the FASB
issued SFAS No. 146, Accounting for Costs Associated with Exit or Disposal
Activities (SFAS 146).

     SFAS 141 requires all business  combinations  initiated after June 30, 2001
to be accounted for under the purchase  method.  SFAS 141 superseded APB Opinion
No. 16, Business  Combinations,  and Statement of Financial Accounting Standards
No. 38, Accounting for Preacquisition Contingencies of Purchased Enterprises.

     SFAS 142 addresses the financial accounting and reporting for acquired
goodwill and other intangible assets. Under the new rules, the Company is no
longer required to amortize goodwill and other intangible assets with indefinite
lives but will be subject to periodic testing for impairment. SFAS 142
supersedes APB Opinion No. 17, Intangible Assets. Effective October 1, 2002, the
Company will adopt SFAS 142 and is evaluating the effect that such adoption may
have on its consolidated results of operations and financial position. However,
the Company expects that a substantial amount of its intangible assets will no
longer be amortized.

     SFAS 143 establishes accounting standards for the recognition and
measurement of an asset retirement obligation and its associated asset
retirement cost. It also provides accounting guidance for legal obligations
associated with the retirement of tangible long-lived assets. SFAS 143 is
effective in fiscal years beginning after June 15, 2002, with early adoption
permitted. The Company expects that the provisions of SFAS 143 will not have a
material impact on its consolidated results of operations and financial position
upon adoption. The Company plans to adopt SFAS 143 effective October 1, 2002.

     SFAS 144 establishes a single accounting model for the impairment or
disposal of long-lived assets, including discontinued operations. SFAS 144
superseded SFAS No. 121, Accounting for the Impairment of Long-Lived Assets and
for Long-Lived Assets to Be Disposed Of and APB Opinion No. 30, Reporting the
Results of Operations - Reporting the Effects of Disposal of a Segment of a
Business, and Extraordinary, Unusual and Infrequently Occurring Events and
Transactions. The provisions of SFAS 144 are effective in fiscal years beginning
after December 15, 2001, with early adoption permitted and, in general, are to
be applied prospectively. The Company adopted SFAS 144 effective October 1, 2001
and such adoption did not have a material impact on its consolidated results of
operations and financial position.

     The most immediate impact of SFAS 145 is that losses on the early
extinguishment of debt are no longer recorded as extraordinary items.

     SFAS 146 requires that a liability for a cost associated with an exit or
disposal activity be recognized when the liability is incurred and nullifies the
guidance of EITF No. 94-3, Liability Recognition for Certain Employee
Termination Benefits and Other Costs to Exit an Activity (including Certain
Costs Incurred in Restructuring), which recognized a liability for an exit cost
at the date of an entity's commitment to an exit plan. SFAS 146 requires that
the initial measurement of a liability be at fair value. SFAS 146 will be
effective for exit or disposal activities that are initiated after December 31,
2002 with early adoption encouraged. The Company plans to adopt SFAS 146
effective October 1, 2002 and does not expect that the adoption will have a
material impact on its consolidated results of operations and financial
position.



<PAGE>


                           ABC FAMILY WORLDWIDE, INC.
                      (FORMERLY FOX FAMILY WORLDWIDE, INC.)

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


SEASONALITY

     The Company's businesses are subject to the effects of seasonality.
Consequently, the operating results for the quarter and nine months ended June
30, 2002 for each business segment, and for the Company as a whole, are not
necessarily indicative of results to be expected for the full year.

     Broadcasting revenues are influenced by advertiser demand and the seasonal
nature of programming, and generally peak in the spring and fall.

     Production and distribution revenues fluctuate based upon the timing of the
release of product. Release dates are determined by several factors, including
product availability, timing of vacation and holiday periods and competition in
the market.

Results of Operations

     Three months ended June 30, 2002 as compared with three months ended June
30, 2001

     Revenues for the quarter decreased 31.4%, or $63.7 million, to $139.2
million compared to the prior-year quarter. The decrease was driven by declines
of $12.4 million and $51.3 million in broadcasting and production and
distribution, respectively. Decreased broadcasting revenues were primarily due
to the fact that the Company ceased to broadcast the Fox Kids Network upon the
close of the acquisition by Disney, which reduced revenues by $14.4 million,
partially offset by higher subscriber fee revenues. Decreased production and
distribution revenues reflected a non-recurring sale of a film library in the
prior year and lower foreign syndication revenues due to decreased production
activity and several non-recurring deals in the prior year.

     Production and programming costs decreased 35.6%, or $35.0 million, to
$63.4 million. Production and programming costs as a percentage of total
revenues decreased to 45.6% for the current period from 48.5% for the prior-year
quarter. The decrease in production and programming costs as a percentage of
revenues is primarily due to the sale of a film library in the prior year and
lower film library amortization in the current year due to the mix of
programming, partially offset by higher amortization expense for the ABC Family
Channel due to increased airings of higher priced off-network programming.

     Selling, general and administrative expenses increased 20.0%, or $11.3
million, to $67.8 million as compared to the prior-year quarter, reflecting
higher bad debt expenses and increased costs from international broadcast
operations due to expansion, partially offset by decreases due to the transfer
of Fox Kids Network to Fox.

     During the quarter, the Company adjusted its previously recorded
acquisition charges as a result of management's continuing review of Company
operations. Management is the process of finalizing its review of Company
operations and additional acquisition charges may be recorded.

     Net interest expense includes a loss on the repurchase of debt totaling
$12.8 million resulting from repurchases during the quarter of certain amounts
of the Company's senior notes and senior discount notes at costs in excess of
book value.


<PAGE>


                           ABC FAMILY WORLDWIDE, INC.
                      (FORMERLY FOX FAMILY WORLDWIDE, INC.)

                   MANAGEMENT'S DISCUSSION AND ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

     Net loss for the quarter was $56.5 million, compared to a net loss of $10.1
million for the prior-year quarter. The current period loss was driven by
decreased revenues and higher selling, general and administrative charges,
partially offset by lower production and programming costs. The Company has not
provided for any income tax provision or benefit during the current or
prior-year period. The combination of current losses and prior-year loss carry
forwards resulted in no income tax liability and accordingly no provision. The
Company has not recorded any income tax benefit as it is not certain that those
benefits will be realized.

      Nine months ended June 30, 2002 as compared with nine months ended June
30, 2001

     Revenues for the nine-month period decreased 31.9%, or $181.2 million, to
$386.0 million compared to the prior-year nine-month period. Revenues for the
broadcast and production and distribution segments decreased $56.1 million and
$125.1 million, respectively. Decreased broadcasting revenues were primarily due
to the termination of Fox Kids Network broadcasts following the acquisition by
Disney, which reduced revenues by $42.4 million, and lower domestic advertising
sales and domestic subscriber fee revenues. The decrease in production and
distribution revenues reflected a non-recurring sale of a film library in the
prior year, lower merchandising and toy royalty revenue for certain licensed
properties and lower foreign syndication revenues due to decreased production
activity and several non-recurring deals in the prior year.

     Production and programming costs decreased 30.8%, or $77.1 million, to
$172.9 million. Production and programming costs as a percentage of total
revenues increased to 44.8% for the current nine-month period from 44.1% for the
prior-year period. The increase in production and programming costs as a
percentage of revenues is primarily due to higher amortization rates for the
Company's film library due to programming mix, partially offset by decreases due
to the film library sale in the prior year.

     Selling, general and administrative expenses increased 18.6%, or $30.0
million, to $190.9 million as compared to the prior-year nine-month period,
reflecting higher legal and bad debt expenses and increased costs from
international broadcast operations due to expansion, partially offset by
decreases due to the transfer of the Fox Kids Network to Fox.

     During the nine-month period, the Company recorded acquisition charges
totaling $361.6 million due primarily to changes in its strategic direction
resulting from the acquisition by Disney. The charges were primarily for
write-offs of programs that, under Disney management, will not be utilized.
Management is in the process of finalizing its review of the Company's
operations and additional acquisition charges may be recorded. Additionally, the
charges included one-time acquisition bonuses to certain Company executives,
employee-related severance costs, fixed asset write-downs and leasehold
termination costs for facilities that will no longer be used.

     Net interest expense includes a loss on repurchase of debt totaling $12.8
million resulting from repurchases during the current-period of the Company's
senior notes and senior discount notes at costs in excess of book value.

     Net loss for the nine-month period was $517.4 million, compared to a net
loss of $10.8 million for the prior-year period. The current period loss was
driven by acquisition charges, decreased revenues and higher selling, general
and administrative costs, partially offset by lower production and programming
costs. The Company has not provided for any income tax provision or benefit
during the current or prior-year period. The combination of current losses and
prior-year loss carry forwards resulted in no income tax liability and
accordingly no provision. The Company has not recorded any income tax benefit as
it is not certain that those benefits will be realized.


<PAGE>
                              ABC FAMILY WORLDWIDE,
                   INC. (FORMERLY FOX FAMILY WORLDWIDE, INC.)
                   MANAGEMENT'S DISCUSSION AND ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

Liquidity and Capital Resources

     Net cash used in operating activities for the current nine month period was
$150.4 million, compared to $22.8 million for the prior-year nine-month period,
primarily due to lower earnings, the timing of the payments of accounts payable
and accrued liabilities and stock option payments made in conjunction with the
Disney acquisition, partially offset by the collection of related party
receivables.

     Net cash used in investing activities was $3.3 million and $12.0 million
for the current and prior-year nine-month periods, respectively, and was
primarily for property and equipment purchases.

     Net cash provided by financing activities was $176.0 million and $8.5
million for the current and prior-year nine-month periods, respectively. In
connection with the acquisition, all outstanding debt under the $467.0 million
credit facility was repaid and the credit facility was terminated. This
repayment was funded by an advance from Disney totaling $522.4 million during
the first quarter of the current year. During the six months ended June 30,
2002, Disney advanced an additional $342.8 million to the Company representing
cash for operating requirements, interest, senior note and senior discount note
buy backs and other charges. Additionally, during the current nine-month period,
the Company repurchased certain of its senior notes and senior discount notes
with a basis of $185.1 for a total cost of $197.9 million and paid $23.2 million
in preferred dividends.

     The Company has revolving credit agreements with Disney, which provide for
borrowings totaling $2.6 billion and expire in fiscal 2007. As of June 30, 2002,
there were $777.3 million of borrowings outstanding under the revolving credit
agreements and approximately $1.8 billion was available. The borrowings are due
on October 23, 2006, and the Company may make prepayments of the outstanding
principal amount without premiums or penalty. The borrowings bear interest at
the Eurocurrency rate, as defined and is payable semi-annually. Interest expense
for both the subordinated and revolving borrowings totaled $41.7 million for the
nine month period ended June 30, 2002 reflecting an effective interest rate of
approximately 7%.

     On November 1, 2001, the Company made an election to change the payment
terms on its 10 1/4% senior discount notes. Whereas interest on this debt
accrued semi-annually to the principal balance to be paid at maturity, on
November 1, 2001, the Company elected to change to semi-annual cash interest
payments with the first payment on May 1, 2002.

     Commitments to purchase broadcast programming were approximately $540.0
million, including approximately $140.9 million for available programming, at
June 30, 2002. The Company expects to continue to enter into commitments to
purchase broadcast programming rights.

     Management believes that cash flow from operations, cash on hand and
funding from Disney, should be sufficient to fund its operations and service its
debt for the foreseeable future.

OTHER MATTERS

Accounting Policies and Estimates

     We believe that the application of the following accounting policies, which
are important to the Company's financial position and results of operations,
requires significant judgments and estimates on the part of management. For a
summary of all of our accounting policies, including the accounting policies
discussed below, see Note 2 of the Consolidated Financial Statements in the
Company's Annual Report on Form 10K for the year ended June 30, 2001.


<PAGE>
                           ABC FAMILY WORLDWIDE, INC.
                      (FORMERLY FOX FAMILY WORLDWIDE, INC.)

                   MANAGEMENT'S DISCUSSION AND ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

     Film and television revenues and costs

     We expense the cost of film and television production and participations
over the applicable product life cycle based upon the ratio of the current
period's gross revenues to the estimated remaining total gross revenues. These
estimates are calculated on an individual production basis for film and
television and on an individual contract basis for sports rights. Estimates of
total gross revenues can change due to a variety of factors, including the level
of market acceptance, advertising rates and subscriber fees.

     Broadcast rights for theatrical movies, series and other programs are
charged to expense based on the number of times the program is expected to be
shown. Estimates of usage may change based on competition and audience
acceptance. Accordingly, revenue estimates and planned usage are reviewed
periodically and are revised if necessary. A change in revenue projections or
planned usage could have an impact on our results of operations.

     Costs of film and television productions and programming costs for our
television and cable networks are subject to valuation adjustments pursuant to
the applicable accounting rules. Estimated values are based upon assumptions
about future demand and market conditions. If actual demand or market conditions
are less favorable than our projections, film, television and programming cost
write-downs may be required.

     Goodwill, Intangible Assets, Long-lived Assets and Investments

     We continuously monitor and evaluate the realizability of goodwill and
intangible assets, to determine whether their carrying values have been
impaired. In evaluating the value and future benefits of existing assets, we
compare their carrying value to our best estimate of undiscounted future cash
flows expected to result from the use of the assets and their eventual
disposition. We also consider events or changes in circumstances, such as
changes in the number of subscribers, that indicate that assets may not be
recoverable. If such assets are considered to be impaired, the impairment to be
recognized is measured by the amount by which the carrying value of the assets
exceeds the estimated fair value of the assets. If these estimates or related
projections change in the future, we may be required to record impairment
charges for these assets.

     Long-lived assets include certain long-term investments. The fair value of
the long-term investments is dependent on the performance of the companies we
invest in, as well as volatility inherent in the external markets for these
investments. In assessing potential impairment for these investments, we will
consider these factors as well as forecasted financial performance of our
investees. If these forecasts are not met, impairment charges may be required.

     Contingencies and Litigation

     We are currently involved in certain legal proceedings and, as required,
have accrued our estimate of the probable costs for the resolution of these
claims. This estimate has been developed in consultation with outside counsel
and is based upon an analysis of potential results, assuming a combination of
litigation and settlement strategies. It is possible, however, that future
results of operations for any particular quarterly or annual period could be
materially affected by changes in our assumptions or the effectiveness of our
strategies related to these proceedings.



<PAGE>


                           ABC FAMILY WORLDWIDE, INC.
                      (FORMERLY FOX FAMILY WORLDWIDE, INC.)

                   MANAGEMENT'S DISCUSSION AND ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

Accounting Changes

     In July 2001, the FASB issued SFAS No. 141, Business Combinations (SFAS
141) and SFAS No. 142, Goodwill and Other Intangible Assets (SFAS 142). The FASB
also issued SFAS No. 143, Accounting for Obligations Associated with the
Retirement of Long-Lived Assets (SFAS 143), and SFAS No. 144, Accounting for the
Impairment or Disposal of Long-Lived Assets (SFAS 144), in August and October
2001, respectively. In April 2002, the FASB issued SFAS No. 145, Rescission of
FASB Statements No. 4, 44 and 64, Amendment of FASB Statement No. 13, and
Technical Corrections as of April 2002 (SFAS 145) and in June 2002, the FASB
issued SFAS No. 146, Accounting for Costs Associated with Exit on Disposal
Activities (SFAS 146).

     SFAS 141 requires that all business combinations initiated after June 30,
2001 be accounted for under the purchase method. SFAS 141 superseded APB
Opinion No. 16, Business Combinations, and SFAS No. 38, Accounting for
Preacquisition Contingencies of Purchased Enterprises.

     SFAS 142 addresses the financial accounting and reporting for acquired
goodwill and other intangible assets. Under the new rules, the Company is no
longer required to amortize goodwill and other intangible assets with indefinite
lives but will be subject to periodic testing for impairment. SFAS 142
supersedes APB Opinion No. 17, Intangible Assets. Effective October 1, 2002, the
Company will adopt SFAS 142 and is evaluating the effect that such adoption may
have on its consolidated results of operations and financial position. However,
the Company expects that a substantial amount of its intangible assets will no
longer be amortized.

     SFAS 143 establishes accounting standards for the recognition and
measurement of an asset retirement obligation and its associated asset
retirement cost. It also provides accounting guidance for legal obligations
associated with the retirement of tangible long-lived assets. SFAS 143 is
effective in fiscal years beginning after June 15, 2002, with early adoption
permitted. The Company expects that the provisions of SFAS 143 will not have a
material impact on its consolidated results of operations and financial position
upon adoption. The Company plans to adopt SFAS 143 effective October 1, 2002.

     SFAS 144 establishes a single accounting model for the impairment or
disposal of long-lived assets, including discontinued operations. SFAS 144
superseded SFAS No. 121, Accounting for the Impairment of Long-Lived Assets and
for Long-Lived Assets to Be Disposed Of, and APB Opinion No. 30, Reporting the
Results of Operations - Reporting the Effects of Disposal of a Segment of a
Business, and Extraordinary, Unusual and Infrequently Occurring Events and
Transactions. The provisions of SFAS 144 are effective in fiscal years beginning
after December 15, 2001, with early adoption permitted and, in general, are to
be applied prospectively. The Company adopted SFAS 144 effective October 1, 2001
and such adoption did not have a material impact on its consolidated results of
operations and financial position.

     The most immediate impact of SFAS 145 is that losses on the early
extinguishment of debt are no longer recorded as extraordinary items.




<PAGE>


                           ABC FAMILY WORLDWIDE, INC.
                      (FORMERLY FOX FAMILY WORLDWIDE, INC.)

                   MANAGEMENT'S DISCUSSION AND ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)


     SFAS 146 requires that a liability for a cost associated with an exit or
disposal activity be recognized when the liability is incurred and nullifies the
guidance of EITF No. 94-3, Liability Recognition for Certain Employee
Termination Benefits and Other Costs to Exit an Activity (including Certain
Costs Incurred in Restructuring), which recognized a liability for an exit cost
at the date of an entity's commitment to an exit plan. SFAS 146 requires that
the initial measurement of a liability be at fair value. SFAS 146 will be
effective for exit or disposal activities that are initiated after December 31,
2002 with early adoption encouraged. The Company plans to adopt SFAS 146
effective October 1, 2002 and does not expect that the adoption will have a
material impact on its consolidated results of operations and financial
position.

MARKET RISK

     The Company's primary market risks include fluctuations in interest rates,
variability in interest rate spread relationships (i.e., prime to LIBOR spreads)
and exchange rate variability. On occasion, the Company may choose to manage
these market risks by using derivative financial instruments in accordance with
established policies and procedures. Currently, the Company does not use
derivative financial instruments for trading purposes. Additionally, the Company
maintains a mix of fixed and floating debt to mitigate its exposure to interest
rate fluctuations.

     The Company had no interest rate swaps, foreign exchange or other material
financial instruments outstanding at June 30, 2002.

     The Company's management believes that fluctuations in interest rates and
currency exchange rates in the near term would not materially affect the
Company's consolidated operating results, financial position or cash flows as
the Company has limited risks related to interest rate and currency exchange
rate fluctuations.



<PAGE>


                           ABC FAMILY WORLDWIDE, INC.
                      (FORMERLY FOX FAMILY WORLDWIDE, INC.)

                   MANAGEMENT'S DISCUSSION AND ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)


                           PART II. OTHER INFORMATION

ITEM 1.        LEGAL PROCEEDINGS

     The Company currently and from time to time is engaged in litigation in the
ordinary course of its business. The Company is not currently a party to any
lawsuit or proceeding which, in the opinion of management, if decided adversely
to the Company, would be likely to have a material adverse effect on the
Company's financial condition and results of operations.

ITEM 6.        EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits

      99(a)    Certification by Robert A. Iger, President of the Company,
               pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
               Section 906 of the Sarbanes-Oxley Act of 2002.

      99(b)    Certification by Thomas O. Staggs, Chief Financial Officer of the
               Company, pursuant to 18 U.S.C. Section 1350, as adopted pursuant
               to Section 906 of the Sarbanes-Oxley Act of 2002.


<PAGE>


                                       SIGNATURE



       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.


                                             ABC FAMILY WORLDWIDE, INC.




Date: August 12, 2002                        /s/ Thomas O. Staggs
                                             ---------------------------------
                                             Thomas O. Staggs
                                             Chief Financial Officer