SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                   FORM 10-QSB

(MARK ONE)

[X]    QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE
       ACT OF 1934

       For the quarterly period ended March 31, 1998

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

       For the transition period from ___________________ to ___________________

                           Commission File No. 0-24188

                                   JOTAN, INC.
        (Exact name of small business issuer as specified in its charter)

                     Florida                             59-3181162
         (State or other jurisdiction of       (IRS Employer Identification No.)
          incorporation or organization)

         Issuer's telephone number, including area code (904) 355-2592

         -------------------------------------------------------------------
            Former name, former address and former fiscal year, if changed


Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15 (d) of the  Securities  Exchange  Act of 1934 during the past 12 months
(or for such shorter  period that the issuer was required to file such  reports)
and (2) has been subject to such filing requirements for the past 90 days.
                              Yes [X]        No [ ]


APPLICABLE ONLY TO CORPORATE ISSUERS - State the number of shares outstanding of
each of the  issuer's  classes of common  equity,  as of the latest  practicable
date: 21,414,013 shares of common stock, $.01 par value, as of April 15, 1998.



<PAGE>





                                      INDEX

                                   Jotan, Inc.



Part I - Financial Information                                           Page

         Item I --   Financial Statements (Unaudited)
                     Condensed Consolidated Statements of Operations
                     For the Three Months ended March 31, 1998 and 1997    2

                     Condensed Consolidated Balance Sheet at
                     March 31, 1998 and 1997                            3 and 4

                     Condensed Consolidated Statements of Cash Flows
                     for the Three Months ended March 31, 1998
                     and 1997                                           5 and 6

                     Notes to Condensed Consolidated Financial Statements  7

         Item II --  Management's Discussion and Analysis of
                     Financial Condition and Result of Operations          8

         Item III -- Liquidity and Capital Resources                       9


Part II - Other Information

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

         Signatures                                                       12


<PAGE>
<TABLE>
                                   Jotan, Inc.

                 Condensed Consolidated Statements of Operations
                                   (Unaudited)


<CAPTION>
                                                    Three months ended March 31
                                                       1998             1997

<S>                                               <C>             <C>
Sales                                             $ 15,861,484    $   6,789,207
Cost of sales                                       11,129,653        4,748,143
                                                  ------------     ------------
Gross profit                                         4,731,831        2,041,064

Operating expenses                                   4,870,977        1,941,325
Amortization of goodwill and non-compete               192,321          272,508
                                                  ------------     ------------
Operating income (loss)                           (    331,467)    (    172,769)

Other income                                             4,333            9,910
Interest expense                                   ( 1,054,725)    (    320,598)

Income (loss) before taxes                         ( 1,381,859)    (    483,457)
Income tax expense                                           -                -
                                                  ------------     ------------

Net income (loss)                                  ( 1,381,859)    (    483,457)

Amounts attributable to preferred stock                371,977          100,209
                                                  ------------     ------------
Net income (loss) attributable
   to common shareholders                        $ ( 1,753,836)   $ (   583,666)
                                                 ==============   ==============

Net income (loss) per share
   Basic                                         $      (.31)      $     (.10)
                                                 =============     ============
   Diluted                                       $      (.31)      $     (.10)

Weighted average number of shares outstanding:
   Basic                                             5,696,611        5,679,411
                                                     =========        =========
   Diluted                                           5,696,611        5,679,411
                                                     =========        =========
</TABLE>








See notes to condensed consolidated financial statements.

                                       2

<PAGE>
<TABLE>

                                   Jotan, Inc.

                      Condensed Consolidated Balance Sheets
                                   (Unaudited)

<CAPTION>
                                                       March 31
                                             1998                    1997
                                             ----                    ----
<S>                                     <C>                     <C>
Assets
Current assets:
     Cash                               $  1,180,178            $  3,018,575
     Accounts receivable, net              9,159,429               7,342,019
     Inventory                             7,052,975               7,198,999
     Other current assets                  1,757,815                 788,247
                                          ----------              ----------
Total current assets                      19,150,397              18,347,840
                                          ----------              ----------


Property and equipment, net                4,687,138               4,882,390


Goodwill, net                              1,948,030              25,185,671
Non-compete agreements, net                1,760,949               6,490,500
Other assets                                 275,869                 932,328
                                         -----------             -----------

Total assets                             $27,822,383             $55,838,729
                                         ===========             ===========
</TABLE>








See notes to condensed consolidated financial statements.

                                       3
<PAGE>
<TABLE>

                                   Jotan, Inc.

                      Condensed Consolidated Balance Sheet
                                   (Unaudited)

<CAPTION>
                                                             March 31
                                                      1998             1997
                                                    ----------       ----------
<S>                                               <C>              <C>
Liabilities and stockholders' equity
Current liabilities:
    Trade payables                                $  7,490,563     $  7,697,317
    Accrued expenses                                 3,543,235        3,766,276
    Current portion of long-term debt,
       and capital leases                            9,903,432        1,306,802
    Other                                            1,431,633          898,454
                                                     ---------          -------
Total current liabilities                           22,368,863       13,668,849
                                                    ----------       ----------

Capitalized lease obligations                        3,828,652        4,029,643
Other liabilities                                    2,125,105          122,486
Long-term debt, less current maturities
    Related parties                                  9,189,596        8,710,000
    Other                                           14,313,768       17,773,077
                                                    ----------       ----------
                                                    29,457,121       30,635,206
                                                    ----------       ----------

Redeemable preferred stock with related parties     12,932,747        9,340,000

Stockholders' equity (deficit)
    Preferred stock:
       Authorized shares - 10,000,000
       Issued and outstanding shares to
        related party - 1,435,705 in 1998 and
       1,265,823 in 1997                                14,357           12,658
    Voting common stock, $.01 par value:
       Authorized shares - 40,000,000
       Issued and outstanding shares - 5,696,611
       in 1998 and 5,679,411 in 1997                    56,966           56,794
    Additional paid-in capital                       3,849,385        4,613,983
    Retained earnings (deficit)                    (40,857,056)      (2,488,761)
                                                   ------------      -----------
Total stockholders' equity (deficit)               (36,936,348)       2,194,674
                                                   ------------      -----------

Total liabilities and stockholders' equity         $27,822,383      $55,838,729
                                                   ===========      ===========
</TABLE>







See notes to condensed consolidated financial statements.

                                       4
<PAGE>
<TABLE>

                                   Jotan. Inc.

                 Condensed Consolidated Statements of Cash Flows
                                   (Unaudited)

<CAPTION>
                                                              March 31
                                                         1998          1997
                                                     ------------  ------------
<S>                                                  <C>           <C>
Cash flows from operating activities
 Net income (loss)                                   $( 1,381,859) (    483,457)
Adjustments to reconcile net income (loss) to
 net cash provided by (used in) operating
 activities:
   Depreciation and amortization expense                  355,441       329,213
   Stock compensation expense                                   -        25,800
   Changes in operating assets and liabilities:
     Accounts receivable                                  397,530       178,786
     Inventory                                            231,334  (    227,476)
     Other current assets                            (     91,315)       47,583
     Other assets                                               -       495,192
     Trade payables                                        62,378     2,892,684
     Accrued expenses                                     138,283        30,422
     Other current liabilities                       (    115,571) (     23,667)
     Other liabilities                                      1,944             -
                                                     ------------  ------------
Net cash (used in) provided by operating
 activities                                          (    401,835)    3,265,080

Cash flows from investing activities
Proceeds from sale of property and equipment                    -     1,000,000
Purchase of property and equipment                   (      2,375) (     31,203)
Purchase of business Southland, net of cash
 acquired                                                       -  ( 37,482,786)
                                                     ------------- -------------
Net cash used in investing activities                (      2,375)   36,513,989)
                                                     ------------- -------------

Cash flows from financing activities
Proceeds from (payments) on line of credit
 borrowings                                                     -  (  1,594,076)
Payments on long-term debt and capitalized leases    (     54,743) (  1,195,038)
Proceeds from senior revolver                                   -     2,830,884
Proceeds from senior term debt                                  -    16,122,500
Proceeds from senior subordinated debt                          -     8,710,000
Proceeds from issuance of redeemable preferred
 stock, net of issuance costs                             250,000     9,340,000
Proceeds from issuance of warrants                              -       650,000
Net cash provided by financing activities                 195,257    34,864,270

Net increase (decrease) in cash and cash equivalents (    208,953)    1,615,361
Cash and cash equivalents at beginning of period        1,389,131     1,403,214
Cash and cash equivalents at end of period           $  1,180,178  $  3,018,575
</TABLE>

                                       5
<PAGE>
<TABLE>

                                   Jotan. Inc.

          Condensed Consolidated Statements of Cash Flows (Continued.)
                                   (Unaudited)

<CAPTION>
                                                        March 31
                                                1998                1997
                                           -------------        ------------
<S>                                        <C>                  <C>
Purchase of business,
 Southland net of cash acquired
   Accounts receivable                     $           -        $( 5,967,581)
   Inventory                                           -         ( 5,789,881)
   Other current assets                                -         (   517,889)
   Property and equipment                              -         ( 4,069,138)
   Other assets                                        -         (   820,802)
   Trade payables                                      -           3,278,692
   Accrued expenses                                    -           3,488,497
   Other current liabilities                           -             922,121
   Other liabilities                                   -             122,486
   Non - Compete                                       -         ( 6,600,000)
   Goodwill                                            -         (25,262,114)
   Notes payable and capitalized leases                -           3,732,823
                                           -------------        ------------

                                           $           -        $(37,482,786)
                                           =============        =============
</TABLE>








See notes to condensed consolidated financial statements.

                                       6
<PAGE>



                                   Jotan Inc.
              Notes to Condensed Consolidated Financial Statements
                                   (Unaudited)

1. The Business and Basis of Presentation

Description of Business

The Company is a  distributor  of packaging  and shipping  supplies  with twenty
distribution centers and two production facilities located throughout the United
States. The Company sells to a broad customer base including industrial,  moving
and storage,  air freight,  and perishable food market segments.  Prior to March
1997, Jotan, Inc. was a southeast  regional  distributor of packaging  materials
providing  "Just  On  Time  As  Needed"  delivery  service  for  its  industrial
customers.

On March 4, 1997 the Company  completed the  acquisition of 100% of the stock of
Southland Holding Company ("SHC").  The subsidiaries of SHC and one affiliate of
the Company merged with and into SHC in 1997 which changed its name to Southland
Container Packaging Corp. ("Southland"). Southland is a distributor of packaging
and shipping supplies with [eleven]  distribution  centers throughout the United
States.  Southland  served primarily the moving and storage  industry,  but also
provided packaging  products to the air freight and perishable food markets.  As
of June 20, 1997 the Company  completed  the  acquisition  of the assets of Cove
Container Corporation ("Cove").  Cove is a distributor of packaging and shipping
supplies  with  a  distribution  center  located  in  Pontiac,  Michigan,  and a
manufacturing facility in West Branch, Michigan. Cove serves both the industrial
and the moving and storage industry segments.


Basis of Presentation

The  accompanying  financial  statements  are  unaudited  and, in the opinion of
management   reflect  all  the  adjustments   that  are  necessary  for  a  fair
presentation of the financial position and results of operations for the periods
presented. All of such adjustments are of a normal and recurring nature.

The  results  of  operations  for the  periods  presented  are  not  necessarily
indicative  of the results to be expected  for the entire  year.  The  financial
statements at March 31, 1998 and March 31, 1997 reflect the combined accounts of
the Company and its subsidiaries.  Certain  information and footnote  disclosure
normally  included  in the  financial  statements  prepared in  accordance  with
generally accepted accounting principles have been condensed or omitted.



                                       7
<PAGE>

                                   Jotan, Inc.

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

On March 4, 1997, the Company  completed the acquisition of 100% of the stock of
Southland Holding Company and its subsidiaries, now known as Southland Container
Packaging  Corp.  ("Southland").  On June 23, 1997,  the Company  completed  the
acquisition of the assets of Cove Container Corporation ("Cove"). As a result of
these  acquisitions,  the Company's  financial  statements for the quarter ended
March 31, 1997 and the quarter  ended March 31, 1998 are not  comparable in many
respects.  To  facilitate a meaningful  comparison  of the  Company's  operating
performance, the following discussion and analysis is presented on a traditional
basis.  Included in the following discussion are comparisons of EBITDA (earnings
before interest, taxes,  depreciation,  and amortization and other extraordinary
and  non-recurring   charges).   The  Company  believes  EBITDA  is  helpful  in
understanding  cash flow generated from  operations that is available for taxes,
debt service and capital expenditures.  In addition, EBITDA, as redefined in the
senior  loan  documents  to  exclude  certain  extraordinary  and  non-recurring
charges,  facilitates the monitoring of covenants  related to certain  long-term
debt.  EBITDA  should not be considered  by investors as an  alternative  to net
earnings as an indicator of the Company's operating performance or to cash flows
as a  measure  of its  overall  liquidity.  Jotan,  Inc.  and  its  consolidated
subsidiaries reported a net loss of $1.4 million for the quarter ended March 31,
1998  compared to a net loss of $.5 million for the same period in 1997.  EBITDA
for the quarter ended March 31, 1998 was $126 thousand compared to $156 thousand
for the same period in 1997.

<TABLE>
                                      1998 ($000's)          1997 ($000's)
<CAPTION>
         <S>                                <C>                    <C>
         Operating Income/(Loss)            (331)                  (173)
         Amortization                        192                    272
         Depreciation                        163                     57
         Other Non-Recurring                 102

         EBITDA                              126                    156
</TABLE>

Net sales for the first  quarter of 1998  increased  to $15.9  million from $6.8
million for the first  quarter of 1997.  The increase in net sales was primarily
related  to  post  acquisition  revenue  generated  by the  Southland  and  Cove
operations which is only partially included in first quarter 1997 results.

Gross profit  increased to $4.7 million for the first  quarter of 1998 from $2.0
million the same period in 1997.  Margins declined slightly from 30.1% to 29.8%.
The increase in gross profit was primarily  related to post acquisition  revenue
generated by the Southland and Cove operations which is only partially  included
in first quarter 1997 results.

Operating  expenses increased to $4.9 million for the first quarter of 1998 from
$1.9 million for the same period in 1997. The major factor contributing to these
increases  was  the  inclusion  of  Southland  operating  expenses  in the  post
acquisition period.

Amortizations of goodwill and non-compete agreements were $192 thousand and $273
thousand for the first quarters of 1998 and 1997, respectively. Post acquisition
amortization expense was significantly reduced by the year-end 1997 write-off of
Southland related goodwill.

Interest  expense  for the  first  quarters  of 1998 and 1997  amounted  to $1.1
million and $0.3 million  respectively.  The major factor  contributing to these
increases  was the  impact of  increased  borrowings  related  to the  Southland
acquisition.

In April,  1998,  the Company  selected  Raleigh C. Minor to be Chief  Executive
Officer of the  Company and  Southland.  Mr.  Minor had been  serving as Interim
Chief  Executive  Officer.  Mr. Minor was also a principal  of

                                       8
<PAGE>

                                  Jotan, Inc.

II. Management's Discussion and Analysis of Financial Condition and Results of 
    Operations (continued)

Allomet  Partners Ltd., but resigned when selected to be the Chief Executive 
Officer.

The Company  has  developed a Business  Plan to improve  performance,  meet cash
requirements  including  bank and vendor debt,  and  establish a foundation  for
future operations.  Key elements of the plan include  management  restructuring,
facility consolidations,  improved working capital management, cost containment,
and expansion within certain product lines.  Significant  progress has been made
toward  implementing  the Plan including  warehouse  consolidations/closures  in
Syracuse, Denver, and Tacoma.

For the first quarter,  the Company  reported  EBITDA of $126 thousand  versus a
planned  first  quarter loss of $145  thousand.  Although it is much too soon to
predict  success,  there are many marked changes as compared to 1997.  There are
risks associated with this plan,  including but not limited to, general economic
and business conditions,  competitive market pricing, and failure to effectively
maintain vendor relationships.

III. Liquidity and Capital Resources

On  December  31,  1997 the Company  did not make the  scheduled  principal  and
interest payments  required under its credit agreement (the "Credit  Agreement")
with Banque Paribas,  individually  and as agent for other  participating  banks
(the "Banks").

As of April 14, 1998, the Company and Southland  entered into a Fifth  Amendment
to its Credit Agreement with the Banks (the "Fifth Amendment") whereby the Banks
waived the  events of  default  for  nonpayment  and agreed to defer  delinquent
interest payments and other scheduled interest payments through July 31, 1998 by
execution of interest  deferral notes.  Scheduled  principal  payments also were
deferred  until March 1999.  The Company  agreed to shorten the maturity date of
all loans so that all principal and interest  under loans from the Banks will be
due on February 28, 2001. The Company agreed to give the Banks tighter  controls
and liens on cash  collateral,  and the Banks agreed to relax certain  financial
covenants,  although the miscellaneous debt restriction was reduced to $100,000.
One of the new terms was that all collections on customer  receivables  would be
used to pay down the revolving line of credit through a lockbox arrangement.  As
a result,  the amount  outstanding  under the revolving  line of credit has been
classified  as a current  liability  resulting in a working  capital  deficit of
approximately  $3,200,000.  As a result of the Fifth  Amendment,  the  Company's
working capital line of credit with the Banks was extended by approximately $1.5
million to help meet the Company's financing requirements.

In conjunction with the Fifth Amendment,  Rice Partners II L.P.(Rice) loaned the
Company an additional  $1,250,000.  In exchange for this loan which was obtained
in April 1998, the Company issued to Rice its 12.5% priority senior subordinated
notes (the  "Priority  Notes").  Interest  payments under the Priority Notes are
payable with PIK notes until the Bank's debt is repaid.  The Priority  Notes and
the PIK Notes are junior to the Bank's debt but senior to the subordinated notes
previously  issued to Rice and Fairview in 1997.  The Company agreed to issue to
Rice  exercisable  warrants for the purchase  (at a nominal  exercise  price) of
42,377,173  shares of the  Company's  common  stock.  The Company also agreed to
issue to Rice similar  warrants to purchase  8,475,638  shares of the  Company's
common  stock in  connection  with  Rice's  purchase  of  $250,000  of  Series B
Redeemable  Preferred  Stock in  January,  1998.  The total  number of shares of
common stock provided under these warrants may be reduced if a fairness  opinion
from an  independent  financial  advisor  indicates  that the  number  of shares
issuable  under the  warrants  is not fair to the  Company's  shareholders.  The
exercise  of such  warrants  is  subject to the  filing of an  amendment  to the
Articles of  Incorporation  of the Company to increase its authorized  shares of
common  stock.  This  amendment is subject to  shareholder  approval and certain
disclosure requirements.  The affirmative vote of Rice alone will constitute the
vote  required to approve  the  amendment.  The Company has filed a  preliminary
proxy  statement  with the Securities  and Exchange  Commission  that contains a
shareholder proposal to approve such amendment.

                                       9
<PAGE>

                                  Jotan, Inc.

III. Liquidity and Capital Resources (continued)

Negotiations  were held with certain key vendors to hold in abeyance amounts due
while a repayment plan was implemented and bank negotiations  were completed.  A
plan has been  developed  and  implemented,  with the approval of the  creditors
involved, to accomplish the repayment of past due amounts over a two year period
while providing for the uninterrupted supply of materials for the business.

Part II -- Other Information

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

          (a)   Exhibits

                Exhibit 11 - Computation of Per Share Earnings

                Exhibit 27 - Financial Data Schedule

          (b)   Reports on Form 8-K

                Form 8-K Current Report, Item 5, Other Events,  filed 
                January 9, 1998.

                Form 8-K Current Report, Item 5, Other Events, filed
                February 27, 1998 






                                       10
<PAGE>

<TABLE>

                                   Jotan, Inc.
           Exhibit 11 Statement Re: Computation of Per Share Earnings

<CAPTION>
                                                   Three months ended March 31
                                                         1998          1997

<S>                                                 <C>           <C>
Basic and Diluted:
   Average shares outstanding                         5,696,611     5,679,411
                                                      =========     =========

Net income (loss)                                   $(1,381,859)  $  (483,457)

Amount attributable to preferred stock                  371,977       100,209
                                                    -----------    ----------

Net income (loss) attributable to common
   shareholders                                     $(1,753,836)  $  (583,666)
                                                    ===========    ===========

Per share amount basic and diluted                   $     (.31)*   $    (.10)*
                                                    ===========    ==========
</TABLE>



* Effect of common stock equivalents was not considered
  as the effect was anti-dilutive.





                                       11
<PAGE>


                                   Jotan, Inc.

SIGNATURES

         Pursuant to the  requirements  of the Securities  Exchange Act of 1934,
the  registrant  has duly  caused  this report to be signed on its behalf by the
undersigned thereunto duly authorized.


                                   Jotan, Inc.




                                   By:     /s/ Raleigh Minor
                                      ---------------------------------
                                        Raleigh Minor, President
                                        and Chief Executive Officer




                                   By:    /s/ Edward Lipscomb
                                      ---------------------------------

                                       Edward Lipscomb, Vice President
                                       and Chief Financial Officer





May 29, 1998



                                       12