<PAGE>

                                 UNITED STATES
                       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 September 30, 1997 or

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

     For the Transition Period from ______to______

                         Commission file number: 0-20758

                               HA-LO INDUSTRIES, INC.
              (Exact name of registrant as specified in its charter)

                Illinois                         36-3573412
      (State  or other jurisdiction            (IRS Employer No.)
            Identification
    of incorporation or organization)

                     5980 TOUHY AVENUE, NILES, ILLINOIS 60714
                (Address of principal executive offices, Zip Code)


Registrant's telephone number, including area code: (847)647-2300

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

As of November 4, 1997, the registrant had an aggregate  of 20,673,821 
shares of its common stock outstanding.

<PAGE>


                           HA-LO INDUSTRIES, INC.
                                    INDEX

Part I.     FINANCIAL INFORMATION                          Page Number
                                                           -----------
            Item 1. Financial Statements.

            Balance Sheets as of September 30, 1997
            and December 31, 1996.                               2

            Statements of Income for the three months
            and nine months ended September 30, 1997             4
            and 1996.

            Statements of Cash Flows for the nine months
            ended September 30, 1997 and 1996.                   5

            Notes to Financial Statements.                       6

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

PART II.    OTHER INFORMATION

            Item 4. Submission of Matters to a Vote             11
                    Of Security Holders.

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

Signatures                                                      12

<PAGE>



                             PART 1. FINANCIAL INFORMATION


                                HA-LO INDUSTRIES, INC.

                             CONSOLIDATED BALANCE SHEETS

                      SEPTEMBER 30, 1997 AND DECEMBER 31, 1996


                                             September 30,       December 31,
                                                 1997                1996
                                             -------------       ------------
                                              (Unaudited)         (Restated)
         ASSETS
CURRENT ASSETS:
  Cash and cash equivalents                  $  2,305,635        $  4,910,619
  Short-term investments                             -              2,908,370
  Receivables                                 101,988,800          74,004,096
  Related party receivable                      1,580,159                -
  Inventories                                  19,729,144          11,957,796
  Prepaid expenses & deposits                   5,837,749           4,172,539
                                             ------------         -----------
     Total current assets                     131,441,487          97,953,420
                                             ------------         -----------
PROPERTY AND EQUIPMENT, net                    17,837,924          14,689,285
                                             ------------         -----------

OTHER ASSETS:
  Intangible assets relating to acquired
    businesses, net                            24,928,482          10,906,275
  Samples                                       1,376,630           1,216,429
  Other                                         2,560,579           2,066,918
                                             ------------         -----------
     Total other assets                        28,865,691          14,189,622
                                             ------------         -----------
                                            $ 178,145,102       $ 126,832,327
                                            =============       =============


        The accompanying notes are an integral part of these balance sheets.

                                       2

<PAGE>

                              HA-LO INDUSTRIES, INC.

                            CONSOLIDATED BALANCE SHEETS

                      SEPTEMBER 30, 1997 AND DECEMBER 31, 1996

                                             September 30,       December 31,
                                                 1997                1996
                                             -------------       ------------
                                              (Unaudited)         (Restated)

      LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
  Current maturities of long-term debt          $  542,667         $  300,000
  Book overdraft                                 4,723,291          1,218,122
  Accounts payable                              37,604,343         23,644,275
  Accrued expenses                              18,821,467         12,725,472
  Due to related parties                              -               138,120
  Deferred taxes - current                       1,130,304          1,058,087
                                              ------------         ----------
    Total current liabilities                   62,822,072         39,084,076
                                              ------------         ----------
LONG-TERM DEBT                                  32,744,078         27,996,259
                                              ------------         ----------

DEFERRED LIABILITIES                             6,150,688          1,768,838
                                              ------------         -----------

COMMITMENTS AND CONTINGENCIES

SHAREHOLDERS' EQUITY:
Preferred stock, no par value; 10,000,000
  shares authorized and none issued                   -                   -
Common stock, no par value: 100,000,000
  shares authorized and 20,672,127 and
  20,183,876 issued and outstanding in 
  1997 and 1996, respectively                   61,070,121         48,837,750
Other                                           (2,042,653)        (2,208,471)
Retained earnings                               17,400,796         11,353,875
                                              ------------         -----------
  Total shareholders' equity                    76,428,264         57,983,154
                                              ------------         -----------
                                            $  178,145,102      $  126,832,327
                                              ============         ===========


       The accompanying notes are an integral part of these balance sheets.


                                       3

<PAGE>

                                  HA-LO INDUSTRIES, INC.

                            CONSOLIDATED STATEMENTS OF INCOME

                                 FOR THE PERIODS ENDED
                               SEPTEMBER 30, 1997 AND 1996
                                      (Unaudited)

<TABLE>
<CAPTION>

                                                       Three Months Ended                      Nine Months Ended
                                                 --------------------------------     --------------------------------
<S>                                              <C>                <C>               <C>                <C>
                                                 September 30,      September 30,     September 30,      September 30,
                                                     1997          1996 (Restated)        1997         1996 (Restated)
                                                 -------------     ---------------    -------------    ---------------
NET SALES                                        $ 98,296,781       $ 85,195,939      $269,520,713       $231,533,285

COST OF SALES                                      67,005,673         60,389,332       185,209,759        166,009,148
                                                   ----------         ----------       -----------        -----------
  Gross profit                                     31,291,108         24,806,607        84,310,954         65,524,137

SELLING EXPENSES                                   12,354,616          9,765,871        33,905,287         27,102,783
GENERAL AND ADMINISTRATIVE EXPENSES                12,376,794         10,379,559        35,278,924         29,865,268
NON-RECURRING CHARGES RELATED TO
  ACQUISITIONS                                           -             1,693,000         2,653,671          1,693,000
                                                   ----------         ----------       -----------        -----------
  Income from operations                            6,559,698          2,968,177        12,473,072          6,863,086

INTEREST EXPENSE, NET                                 525,447            345,473         1,273,045            563,934
                                                   ----------         ----------       -----------        -----------
  Income before taxes                               6,034,251          2,622,704        11,200,027          6,299,152

PROVISION FOR TAXES                                 2,417,127          1,193,808         4,483,651          3,116,363
                                                   ----------         ----------       -----------        -----------
  NET INCOME FOR THE PERIOD                      $  3,617,124       $  1,428,896       $ 6,716,376       $  3,182,789
                                                   ==========         ==========       ===========        ===========

PRO FORMA INCOME DATA:
  Net income as reported                                            $  1,428,896                         $  3,182,789
  Pro forma adjustment to income taxes                                  (145,621)                            (597,292)
                                                                      ----------                          -----------

PRO FORMA NET INCOME:                                               $  1,574,517                         $  3,780,081
                                                                      ==========                          ===========

EARNINGS PER SHARE (Pro forma for 1996):
  Primary                                        $       0.17       $       0.08       $      0.32       $       0.18
  Fully diluted                                  $       0.17       $       0.08       $      0.31       $       0.18
                                                 ============       ============       ===========       ============
WEIGHTED AVERAGE SHARES
  OUTSTANDING:
  Primary                                          21,496,764         20,712,762        21,220,753         20,557,586
  Fully diluted                                    21,670,454         20,827,155        21,497,382         20,653,758
                                                 ============       ============        ==========        ===========

</TABLE>



          The accompanying notes are an integral part of these statements.

                                       4
<PAGE>

                               HA-LO INDUSTRIES, INC.

                         CONSOLIDATED STATEMENTS OF CASH FLOWS

                             FOR THE NINE MONTHS ENDED
                           SEPTEMBER 30, 1997 and 1996
                                     (Unaudited)
                                                September 30,     September 30,
                                                    1997              1996
                                                ------------      ------------
                                                 (Unaudited)       (Restated)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income for the period                       $  6,716,376       $  3,182,789
Adjustments to reconcile net income to net
    cash used for operating activities-
Depreciation and amortization                      3,968,331          3,482,688
Increase in cash surrender value                     208,541               -
Increase in deferred liabilities - other             125,709             12,507
Changes in assets and liabilities,
     net of effects of acquired companies -
  Receivables                                    (12,963,563)         2,567,341
  Inventories                                     (5,188,028)        (3,153,748)
  Prepaid expenses and deposits                   (1,225,103)        (2,023,409)
  Accounts payable, accrued expenses and
    due to related parties                         8,386,330         (4,513,116)
                                                 -----------        -----------
  Net cash provided by (used for)
    operating activities                              28,593           (444,948)
                                                 -----------        -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment               (4,465,708)        (5,035,645)
Purchases of samples                                (482,100)          (398,549)
Decrease (increase) in short-term investments      2,908,370           (923,841)
(Increase) decrease in other assets                  (52,091)            37,300
Cash paid for acquisition,
    including deferred payments                   (4,164,429)        (1,766,850)
                                                 -----------        -----------
  Net cash used for investing activities          (6,255,958)        (8,087,585)
                                                 -----------        -----------

CASH FLOWS FROM FINANCING ACTIVITIES:
Net borrowings under line of credit                  698,238         12,570,092
Increase(decrease) in book overdraft               2,973,289         (1,489,386)
Net proceeds from issuance of common stock         1,548,438            717,245
Dividend payments of acquired companies             (669,455)        (3,573,822)
Repurchase of common stock                          (901,056)          (579,185)
                                                 -----------        -----------
  Net cash provided by financing activities        3,649,454          7,644,944
                                                 -----------        -----------
EFFECT OF EXCHANGE RATE CHANGES ON
  CASH AND CASH EQUIVALENTS                          (27,073)            (7,742)
                                                 -----------        -----------

NET INCREASE (DECREASE) IN CASH AND               (2,604,984)          (895,331)
  EQUIVALENTS
CASH AND EQUIVALENTS, beginning of period          4,910,619          3,095,373
                                                 -----------        -----------
CASH AND EQUIVALENTS, end of period             $  2,305,635       $  2,200,042
                                                 ===========        ===========

           The accompanying notes are an integral part of these statements.

                                       5
<PAGE>

                               HA-LO INDUSTRIES, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                 SEPTEMBER 30, 1997

NOTE 1. BASIS OF PRESENTATION:

The accompanying financial statements have been prepared by the  Company,  
without audit, in accordance with generally accepted accounting  
principles for interim financial information and in conjunction  
with the rules and regulations of the Securities and  Exchange  
Commission. Accordingly, they do not include all of the information and 
footnotes required by generally accepted accounting principles for  
financial statements. In the opinion of management, all adjustments  
(consisting only of normal recurring matters) considered necessary   
for a fair presentation have been included.

The results of operations for the three month and nine month periods ended  
September 30, 1997 are not necessarily indicative of the results that 
may be expected for the full year. These financial statements should  
be read in conjunction with the Company's financial statements and 
related notes in the Company's 1996 Annual Report on Form 10-K.

NOTE 2. CAPITAL STOCK:

The Articles of Incorporation of the Company were amended in the  first  
quarter of 1997 increasing the number of common shares authorized from 
25,000,000 to 100,000,000.

In the third quarter of 1997, options to acquire an aggregate of  108,945 
shares of the Company's common stock were issued under the Company's stock 
plans at exercise prices ranging from $23.00 to $28.75 per share. 
Additionally, 71,969 options were exercised  in the third quarter at prices 
ranging from $2.80 to $20.80 per share.

The difference in the outstanding common shares as of September 30, 
1997 and the common shares used in computing earnings per share for the 
third quarter of 1997 is shown in the following table:

                                                            1997
                                                            ----
    Common shares outstanding per balance sheet          20,672,127
    Effect of shares issuable under stock options
      after applying the treasury stock method            1,244,360
    Effect of using weighted average common shares
      outstanding during the period                        (246,033)
    Common shares used in computing fully diluted        ----------
      earnings per share                                 21,670,454
                                                         ==========


                                       6

<PAGE>


NOTE 3. STATEMENTS OF CASH FLOWS:

The supplemental schedule of non-cash activities for the nine months ended  
September 30, 1997 and 1996 includes the following:

                                                       1997              1996
                                                       ----              ----
Issuance of common shares in connection
   with bonus                                   $    31,250          $   31,250

Issuance of common shares in connection with
 acquisition of businesses                      $10,252,160          $     -

Non-cash consideration in connection with
 acquistion of business                         $ 4,500,000          $     -

Recognition of tax benefits from options
 and restricted stock                           $ 1,301,567          $1,102,960

Conversion of non-operating assets to
 note receivable                                $ 1,530,159          $     -


NOTE 4. RELATED-PARTY TRANSACTIONS:

A member of the board of Directors renders acquisition consulting services to 
the Company pursuant to an agreement. The director's compensation is directly 
contingent upon the successful completion of an acquisition. During the third 
quarter of 1997, the director earned approximately $400,000 and  was granted 
9,100 options at fair value at the date of grant related to acquisitions.

Creative Concepts in Advertising, Inc. (CCA), a wholly owned subsidiary of 
the Company, leases its corporate headquarters from  its Chief Executive 
Officer and Vice Chairman of the Board of the Company.  Rental payments 
under this lease are $25,000 per month.  The Company believes that the  
lease terms are no more or less favorable than otherwise could be obtained 
from unaffiliated third parties.

In connection with the acquisition by the Company of CCA, the Chief Executive 
Officer of CCA and Vice Chairman of the Board of the Company converted 
certain non-operating assets from CCA to a $1,530,159 note receivable.  The 
note bears interest at 7.0% and is due no later than December 31, 1997.

NOTE 5. BUSINESS COMBINATIONS:

On September 24, 1997 and September 25, 1997, the Company acquired Joking 
S.p.A., an Italian-based distributor of promotional products, and Red 
Sail Merchandising/The Corporate Choice, a San Francisco-based  
distributor of promotional products, respectively.  The acquisitions are 
being accounted for under the purchase method of accounting and the results 
of operations are included in the financial statements from the date of 
acquisition.


                                       7


<PAGE>

A  reconciliation of previously reported sales and earnings for  
acquisitions completed in the first nine months of 1997 and accounted for 
using the pooling-of-interests method  of accounting follows:

                                   Three Months Ended         Nine Months Ended
                                   September 30, 1996         September 30, 1996
                                   ------------------         ------------------
  Sales-
  Previously Reported                  $65,110,000               $175,815,000
  Acquired Companies                    20,086,000                 55,718,000
                                       -----------               ------------
       Net Sales                       $85,196,000               $231,533,000
                                       ===========               ============
  Pro Forma Net Income-
  Previously Reported                 $  1,682,000                $ 4,648,000
  Acquired Companies                      (107,000)                  (868,000)
                                       -----------               ------------
       Pro Forma Net Income           $  1,575,000               $  3,780,000
                                       ===========               ============


Prior to their acquisition by the Company, certain entities elected  to be 
treated as S Corporations for Federal income tax  purposes. Pro forma 
net income above includes an unaudited tax benefit for Federal and state 
income taxes at an effective rate of 40%.

NOTE 6: SUBSEQUENT EVENTS:

On November 7, 1997, the Company acquired Bavelco, b.v.b.a., a Belgium-based 
distributor of promotional  products.  The acquisition will be accounted for 
under the purchase  method of accounting.

NOTE 7: ACCOUNTING PRONOUNCEMENTS:

In  1997,  the  Financial accounting Standards Board issued Statement  No. 
128, EARNINGS PER SHARE, Statement No. 129, DISCLOSURE OF INFORMATION 
ABOUT CAPITAL STRUCTURE, Statement No. 130, REPORTING COMPREHENSIVE 
INCOME, and Statement  No. 131, DISCLOSURES ABOUT SEGMENTS OF AN ENTERPRISE 
AND RELATED INFORMATION. These Statements become effective for financial 
statements for both interim and annual periods ending after December 15, 
1997.  Management believes that the adoption of the standards would not  
have a material effect on the financial statements presented.

                                       8

<PAGE>

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

                              RESULTS OF OPERATIONS

THREE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996

Net sales for the third quarter of 1997 increased 15.4% to $98.3 million 
compared to $85.2 million in the corresponding quarter  of 1996.  The 
increase is primarily due to internal growth.

Gross profit increased 26.1% to $31.3 million (31.8% of  net sales) in the  
third quarter of 1997 from $24.8 million (29.1% of net sales) in the 
third quarter of 1996.  As a percentage of net sales, the increase is due  
to increased margins in the promotional products business, and a decrease in 
sales to Montgomery Ward & Co., Inc. (MW), which contributed to a 
lower gross profit percentage in the third quarter of 1996.

Selling expenses as a percentage of net sales for the third quarter of 1997 
were 12.6% ($12.4 million) compared to 11.5% in the third quarter of 1996 
($9.8 million). The increase as a percentage of net sales is attributable 
primarily to an increase in gross profit as a percentage of net sales  and 
the decrease  in sales to MW in 1997.  Such sales are  not subject to payment 
of the Company's standard commissions.

General and administrative expenses as a percentage  of  net sales  were  
12.6%  in  the third quarter of 1997 ($12.4 million) compared to 12.2% 
in the third  quarter of 1996 ($10.4 million).  The increase is 
attributable primarily to higher personnel and occupancy costs necessary  
to support internal growth.

Operating results for the third quarter of 1996 include a $1.7 million 
non-recurring charge to complete an acquisition accounted for using the  
pooling-of-interests method  of accounting.

In the third quarter of 1997 the Company had net interest expense of 
$525,000, compared to $345,000 in the third quarter of 1996. The 
increase is a result of working capital needs necessary to fund growth 
and an effort to speed up payments to vendors of acquired companies.

NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996

Net sales for the first nine months of 1997 increased 16.4% to $269.5  
million compared to $231.5 million in the corresponding period of 1996. 
The increase is due primarily to internal growth.

Gross profit increased 28.7% to $84.3 million (31.3% of  net sales)  in the 
first nine months of 1997 from $65.5 million (28.3% of net sales) in the 
corresponding period of 1996. As a percentage of net sales, the increase 
is attributable to the same reasons listed for the three month period above.

Selling expenses as a percentage of net sales increased slightly to  
12.6% in the first nine months of 1997 ($33.9 million) compared to 11.7% in 
the corresponding period of 1996 ($27.1 million). The increase in the 
percentage is due to the same reasons listed for the three month period above.

                                       9

<PAGE>


General and administrative expenses as a percentage of net sales were  
13.1% in the first nine months of 1997 ($35.3 million) compared to 12.9% 
in the corresponding period of 1996 ($29.9 million). The increase in the 
percentage is not significant.

In connection with acquisitions accounted for using the 
pooling-of-interests method of accounting, the Company incurred 
approximately $2.7 million and $1.7 million of non-recurring expenses for 
the first nine months of 1997 and 1996, respectively.

In the first nine months of 1997 the Company had net interest expense 
of $1.3 million compared to $564,000 in the corresponding period of 1996.  
The increase is a result of working capital needs necessary to fund growth 
and an effort to speed up payments to vendors of acquired companies.

LIQUIDITY AND CAPITAL RESOURCES

The Company's current ratio decreased to 2.09 to 1 as of September 30, 1997 
from 2.51 to 1 at December 31, 1996.  The decrease is due to  timing of 
the Company's trade disbursement schedule in relation to  the quarter end. 
Working capital was $68.6 million at September 30,  1997 compared to $58.9 
million at December 31, 1996. Capital expenditures for property and equipment 
were approximately $4.5 million  for the first nine months of  1997, and 
management expects capital expenditures to be approximately $6.0 million for 
the full year of  1997, excluding acquisitions.

The Company has an unsecured credit facility totaling $65 million,  
consisting of a $45 million revolving line of credit and $20 million 
term acquisition loan. The facility bears interest at either prime less 
 .25% or LIBOR plus between .375% and 1% based on a defined ratio.  The 
Company anticipates that the available funds from this facility will be  
adequate to satisfy its operating cash  needs for the foreseeable future.

INFLATION

Management does not believe that inflation had a significant impact on the  
Company's results of operations for the periods presented.

FORWARD-LOOKING STATEMENTS

Statements contained in this "Management's Discussion and Analysis of 
Financial Condition and the Results of Operation" regarding the amount and 
nature of planned capital expenditures and the Company's belief that 
available borrowings under its credit facility will be sufficient to satisfy 
its future operating cash needs are forward-looking statements that involve 
substantial risKs and uncertainties. Actual results could differ materially 
from those implied by such forward-looking statements.

                                       10

<PAGE>

PART II.  OTHER INFORMATION
          
Item  4.  Submission  of Matters to a  Vote  of  Security Holders

                               None

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

    (a)   Exhibits - None

    (b)   Reports on Form 8-K - None.

                                       11

<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.

                                   HA-LO INDUSTRIES, INC.


Dated:  November 12, 1997          /s/ GREGORY J. KILREA
                                   ---------------------
                                   Gregory J. Kilrea
                                   Duly Authorized Officer
                                   and Chief Financial Officer





                                       12