FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                        QUARTERLY REPORT UNDER SECTION 13
                           or 15(d) OF THE SECURITIES
                              EXCHANGE ACT OF 1934.


                      For Quarter Ended: September 30, 1997


                         Commission file number: 1-11106


                        K-III COMMUNICATIONS CORPORATION
             (Exact name of registrant as specified in its charter)


             DELAWARE                                       13-3647573

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

                      745 Fifth Avenue, New York, New York
                    (Address of principal executive offices)

                                      10151
                                   (Zip Code)

       Registrant's telephone number, including area code (212) 745-0100


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,  and (2) has been subject to such filing  requirements
for the past 90 days.
Yes  X   No 
   ----     ----  

Number of shares of common stock, par value $.01 per share, outstanding as of
October 31, 1997: 129,518,488



<PAGE>


                K-III COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                                      INDEX


                                                                          PAGE

Part I.  Financial Information

     Item 1.   Financial Statements
     -------
               Condensed Consolidated Balance Sheets
               (Unaudited) as of December 31, 1996 and
               September 30, 1997                                           2
               
               Condensed Statements of Consolidated
               Operations (Unaudited) for the nine months
               ended September 30, 1996 and 1997                            3

               Condensed Statements of Consolidated
               Operations (Unaudited) for the three months
               ended September 30, 1996 and 1997                            4

               Condensed Statements of Consolidated
               Cash Flows (Unaudited) for the nine months
               ended September 30, 1996 and 1997                            5

               Notes to Condensed Consolidated
               Financial Statements (Unaudited)                           6-11

     Item 2.   Management's Discussion and Analysis of
     -------   Financial Condition and Results of Operations             12-22

     Item 3.   Quantitative and Qualitative Disclosures About Market Risk   23
     -------

Part II.   Other Information:  None


Signatures                                                                  24






<PAGE>


                K-III COMMUNICATIONS CORPORATION AND SUBSIDIARIES
                CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)


<TABLE>
<CAPTION>


                                                                                 December 31,                   September 30,
                                                                                     1996                            1997
                                                                                    ------                          ------
                                                                               (dollars in thousands, except per share amounts)

ASSETS
Current assets:
<S>                                                                         <C>                             <C>              
    Cash and cash equivalents                                               $            36,655             $          21,693
    Accounts receivable, net                                                            233,603                       211,258
    Inventories, net                                                                     52,743                        28,809
    Net assets held for sale                                                             18,684                        65,008
    Prepaid expenses and other                                                           34,834                        55,940
                                                                           --------------------            ------------------
    Total current assets                                                                376,519                       382,708

Property and equipment, net                                                             122,823                        99,062
Other intangible assets, net                                                            781,316                       649,371
Excess of purchase price over net assets
      acquired, net                                                                     971,665                       992,586
Deferred income tax asset, net                                                          176,200                       176,200
Other non-current assets                                                                123,692                       104,386
                                                                           --------------------            ------------------
                                                                            $         2,552,215             $       2,404,313
                                                                           ====================            ==================

LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIENCY)
Current liabilities:
    Accounts payable                                                        $           107,258             $          67,365
    Accrued interest payable                                                             22,150                         9,667
    Accrued expenses and other                                                          140,959                       161,831
    Deferred revenues                                                                   144,857                       157,580
    Current maturities of long-term debt                                                  6,000                         6,000
                                                                           --------------------            ------------------
    Total current liabilities                                                           421,224                       402,443
                                                                           --------------------            ------------------

Long-term debt                                                                        1,565,686                     1,525,223
                                                                           --------------------            ------------------
Other non-current liabilities                                                            35,062                        29,618
                                                                           --------------------            ------------------
Exchangeable preferred stock                                                            442,729                       569,527
                                                                           --------------------            ------------------
Common stock subject to redemption ($.01 par value, 643,310
    shares and 413,750 shares outstanding at December 31,
    1996 and September 30, 1997, respectively)                                            5,957                         4,234
                                                                           --------------------            ------------------
Shareholders' equity (deficiency):
    Common stock ($.01 par value, 128,349,045 shares and
    129,002,389 shares outstanding at December 31, 1996 and
    September 30, 1997, respectively)                                                     1,283                         1,290
    Additional paid-in capital                                                          772,642                       780,629
    Accumulated deficit                                                                (691,098)                     (900,256)
    Common stock in treasury, at cost (569,100 shares at
    September 30, 1997)                                                                       -                        (6,971)
    Cumulative foreign currency translation adjustments                                  (1,270)                       (1,424)
                                                                           --------------------            ------------------

    Total shareholders' equity (deficiency)                                              81,557                      (126,732)
                                                                           --------------------            ------------------

                                                                           $          2,552,215             $       2,404,313
                                                                           ====================            ==================
</TABLE>

            See notes to condensed consolidated financial statements.


<PAGE>

                K-III COMMUNICATIONS CORPORATION AND SUBSIDIARIES
           CONDENSED STATEMENTS OF CONSOLIDATED OPERATIONS (UNAUDITED)

<TABLE>
<CAPTION>

                                                                                              Nine Months Ended
                                                                                                September 30,

                                                                                           1996              1997
                                                                                           ----              ----
                                                                                (dollars in thousands, except per share amounts)

Sales, net:
<S>                                                                                 <C>               <C>        
    Specialty Magazines                                                             $   505,090       $   553,409
    Education                                                                           268,277           289,702
    Information                                                                         221,684           246,886
                                                                                   ------------      ------------
Total sales, net                                                                        995,051         1,089,997

Operating costs and expenses:
    Cost of goods sold                                                                  250,806           247,298
    Marketing and selling                                                               183,937           204,514
    Distribution, circulation and fulfillment                                           169,444           195,910
    Editorial                                                                            74,804            90,300
    Other general expenses                                                              111,996           120,715
    Corporate administrative expenses                                                    15,336            19,256
    Depreciation and amortization of prepublication
         costs, property and equipment                                                   27,182            26,910
    Provision for loss on the sales of businesses, net and other                              -           138,640
    Amortization of intangibles assets, excess of
         purchase price over net assets acquired and other                              112,762            98,784
                                                                                   ------------      ------------
Operating income (loss)                                                                  48,784           (52,330)

Other income (expense):
    Interest expense                                                                    (91,313)         (103,728)
    Amortization of deferred financing costs                                             (2,784)           (2,323)
    Other, net                                                                            5,612               176
                                                                                   ------------      ------------
Loss before income tax benefit and extraordinary charge                                 (39,701)         (158,205)

Income tax benefit - carryback claim                                                          -             1,685
                                                                                   ------------      ------------

Loss before extraordinary charge                                                        (39,701)         (156,520)

Extraordinary charge - extinguishment of debt                                            (7,572)          (15,401)
                                                                                   ------------      ------------

Net loss                                                                                (47,273)         (171,921)

Preferred stock dividends:
    Non-cash                                                                            (12,257)           (4,451)
    Cash                                                                                (19,069)          (32,786)
                                                                                   ------------      ------------
Loss applicable to common shareholders                                              $   (78,599)      $  (209,158)
                                                                                   ============      ============

Loss applicable to common shareholders per
    common share:

Loss before extraordinary charge                                                    $     (0.55)      $     (1.50)

Extraordinary charge                                                                      (0.06)            (0.12)
                                                                                   ------------      ------------

Net loss                                                                            $     (0.61)      $     (1.62)
                                                                                   ============      ============

Weighted average common shares outstanding                                          128,721,459       129,271,743
                                                                                   ============      ============
</TABLE>

            See notes to condensed consolidated financial statements.


<PAGE>

                K-III COMMUNICATIONS CORPORATION AND SUBSIDIARIES
           CONDENSED STATEMENTS OF CONSOLIDATED OPERATIONS (UNAUDITED)
<TABLE>
<CAPTION>


                                                                                               Three Months Ended
                                                                                                  September 30,

                                                                                          1996                     1997
                                                                                          ----                     ----
                                                                              (dollars in thousands, except per share amounts)

Sales, net:
<S>                                                                              <C>                     <C>             
    Specialty Magazines                                                          $      171,443          $        192,235
    Education                                                                            95,983                    90,140
    Information                                                                          76,992                    86,569
                                                                                ---------------         -----------------
Total sales, net                                                                        344,418                   368,944

Operating costs and expenses:
    Cost of goods sold                                                                   84,345                    87,635
    Marketing and selling                                                                61,794                    65,796
    Distribution, circulation and fulfillment                                            59,392                    68,661
    Editorial                                                                            27,715                    30,623
    Other general expenses                                                               39,454                    39,876
    Corporate administrative expenses                                                     5,485                     6,546
    Depreciation and amortization of prepublication
         costs, property and equipment                                                   10,529                     8,686
    Provision for loss on the sales of businesses, net and other                              -                   138,640
    Amortization of intangible assets, excess of
         purchase price over net assets acquired and other                               37,185                    34,807
                                                                                ---------------         -----------------
Operating income (loss)                                                                  18,519                  (112,326)

Other income (expense):
    Interest expense                                                                    (33,716)                  (34,765)
    Amortization of deferred financing costs                                               (917)                     (741)
    Other, net                                                                            4,219                       158
                                                                                ---------------         -----------------
Net loss                                                                                (11,895)                 (147,674)

Preferred stock dividends:
    Non-cash                                                                             (4,203)                        -
    Cash                                                                                 (7,875)                  (12,456)
                                                                                ---------------         -----------------
Loss applicable to common shareholders                                           $      (23,973)         $       (160,130)
                                                                                ===============         =================

Loss per common share                                                            $        (0.19)         $          (1.24)
                                                                                ===============         =================

Weighted average common shares outstanding                                          128,874,002               129,411,579
                                                                                ===============         =================
</TABLE>

            See notes to condensed consolidated financial statements

<PAGE>

                K-III COMMUNICATIONS CORPORATION AND SUBSIDIARIES
           CONDENSED STATEMENTS OF CONSOLIDATED CASH FLOWS (UNAUDITED)
<TABLE>
<CAPTION>


                                                                                                 Nine Months Ended
                                                                                                    September 30,

                                                                                           1996                     1997
                                                                                           ----                     ----
                                                                                             (dollars in thousands)

Operating activities:
<S>                                                                             <C>                      <C>             
    Net loss                                                                    $       (47,273)         $      (171,921)
    Adjustments to reconcile net loss to net cash
         provided by operating activities:
            Extraordinary charge - extinguishment of debt                                 7,572                   15,401
            Depreciation, amortization and other                                        142,728                  128,017
            Provision for loss on the sales of businesses, net and other                      -                  138,640
            Accretion of discount on acquisition obligation,
               distribution advance and other                                             3,631                    4,957
            Other, net                                                                   (5,258)                     (21)

         Changes in operating assets and liabilities:
         (Increase) Decrease in:
            Accounts receivable, net                                                    (28,170)                  (9,798)
            Inventories, net                                                             20,971                    4,474
            Prepaid expenses and other                                                   (6,423)                 (14,619)
         Increase (Decrease) in:
            Accounts payable                                                            (17,477)                 (26,956)
            Accrued interest payable                                                     15,645                  (12,483)
            Accrued expenses and other                                                  (24,744)                 (14,232)
            Deferred revenues                                                             3,393                    8,672
            Other non-current liabilities                                                  (759)                  (4,014)
                                                                                ---------------          ---------------

            Net cash provided by operating activities                                    63,836                   46,117
                                                                                ---------------          ---------------

Investing activities:
    Additions to property, equipment and other, net                                     (18,103)                 (22,305)
    Proceeds from sales of businesses and other                                           5,788                  111,972
    Payments for businesses acquired                                                   (671,023)                (182,570)
                                                                                ---------------          ---------------

            Net cash used in investing activities                                      (683,338)                 (92,903)
                                                                                ---------------          ---------------

Financing activities:
    Borrowings under credit agreements                                                1,685,910                  739,031
    Repayments of borrowings under credit agreements                                 (1,218,800)                (547,200)
    Repayment of Chase Term Loan                                                       (150,000)                       -
    Repayment of BONY Term Loan                                                        (150,000)                       -
    Proceeds from issuance of 8 1/2% Senior Notes, net of discount                      298,734                        -
    Repayment of acquisition obligation                                                  (3,000)                  (3,000)
    Proceeds from issuance of common stock, net of redemptions                            2,951                    6,362
    Proceeds from the issuance of Series C (exchanged into Series D)
       Preferred Stock, net of issuance costs                                           193,720                        -
    Proceeds from the issuance of Series E Preferred Stock, net of
       issuance costs                                                                         -                  121,450
    Redemptions of 10 5/8% Senior Notes                                                       -                 (242,787)
    Purchases of common stock for the treasury                                                -                   (6,971)
    Dividends paid to preferred shareholders                                            (19,069)                 (32,786)
    Deferred financing costs paid                                                       (14,926)                  (1,821)
    Other                                                                                  (740)                    (454)
                                                                                ---------------          ---------------

            Net cash provided by financing activities                                   624,780                   31,824
                                                                                ---------------          ---------------

Increase (decrease) in cash and cash equivalents                                          5,278                  (14,962)
Cash and cash equivalents, beginning of period                                           27,226                   36,655
                                                                                ---------------          ---------------
Cash and cash equivalents, end of period                                        $        32,504          $        21,693
                                                                                ===============          ===============

Supplemental information:
     Cash interest paid                                                         $        73,420          $       113,215
                                                                                ===============          ===============
</TABLE>

            See notes to condensed consolidated financial statements.



<PAGE>


                K-III COMMUNICATIONS CORPORATION AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                (dollars in thousands, except per share amounts)


1.  Basis of Presentation
    ---------------------

K-III   Communications   Corporation,   together  with  its   subsidiaries,   is
collectively  referred  to as "K-III" or the  "Company".  In the  opinion of the
Company's management,  all adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation have been included. All significant
intercompany  accounts and transactions  have been eliminated in  consolidation.
Certain  reclassifications have been made to the prior year financial statements
to conform to the  classifications  used in the current  period.  The  operating
results  for  the  three  and  nine-month  periods  ended  September  30 are not
necessarily indicative of the results that may be expected for a full year.

The Company's  operations  have been  organized  into three  business  segments:
specialty magazines,  education and information. The specialty magazines segment
has in prior periods been referred to as the specialty  media  segment,  but the
Company  believes that the term  specialty  magazines is more  reflective of the
focus of the segment.

In February  1997, the Financial  Accounting  Standards  Board  ("FASB")  issued
Statement of Financial  Accounting  Standards  ("SFAS") No. 128,  "Earnings  Per
Share". SFAS No. 128 becomes effective for the Company's  consolidated financial
statements  beginning in the fourth quarter of 1997. SFAS No. 128 will eliminate
disclosure of primary earnings per share,  which includes the dilutive effect of
stock  options,   warrants  and  other  convertible  securities  ("Common  Stock
Equivalents"),  and instead  requires  reporting of "basic"  earnings per share,
which excludes Common Stock Equivalents.  Additionally, SFAS No. 128 changes the
methodology for calculating fully dilutive earnings per share. In the opinion of
the Company's  management,  it is not anticipated  that the adoption of this new
accounting  standard  will have a material  effect on the reported  earnings per
share of the Company.

In February 1997, the FASB issued SFAS No. 129, "Disclosure of Information about
Capital   Structure".   SFAS  No.  129  becomes   effective  for  the  Company's
consolidated  financial statements beginning in the fourth quarter of 1997. SFAS
No. 129 requires certain disclosures regarding outstanding securities, preferred
stock  and  redeemable  stock.  In June  1997,  the FASB  issued  SFAS No.  130,
"Reporting  Comprehensive  Income" and SFAS No. 131, "Disclosures about Segments
of an  Enterprise  and Related  Information",  which  become  effective  for the
Company's  1998  consolidated  financial  statements.  SFAS No. 130 requires the
disclosure  of  comprehensive  income,  defined  as the  change  in  equity of a
business  enterprise  during a period  from  transactions  and other  events and
circumstances  from nonowner sources,  in the Company's  consolidated  financial
statements.  SFAS No. 131  requires  that a public  business  enterprise  report
certain  financial and descriptive  information  about its reportable  operating
segments. In the opinion of the Company's management, it is not anticipated that
the adoption of these new accounting  standards  will have a material  effect on
the consolidated financial statements of the Company.

2.  Acquisitions
    ------------

During the nine-month  period ended  September 30, 1997,  the Company  completed
several  acquisitions which were financed through borrowings under the Company's
credit  agreements.  Cash payments for these  acquisitions on an aggregate basis
was $182,570 (net of liabilities assumed of approximately  $33,540) and includes
certain   immaterial   purchase   price   adjustments   related  to  prior  year
acquisitions.   The  excess   purchase  price  over  net  assets   acquired  was
approximately $113,137.

The preliminary  purchase cost allocations for the 1997 acquisitions are subject
to  adjustment  when  additional  information  concerning  asset  and  liability
valuations  is obtained.  The final asset and  liability  fair values may differ
from those set forth in the accompanying condensed consolidated balance sheet at
September  30,  1997;  however,  the changes are not expected to have a material
effect on the consolidated financial statements of the Company.

These  acquisitions  have all been  accounted  for by the purchase  method.  The
financial  statements  include  the  operating  results  of  these  acquisitions
subsequent  to  their  respective   dates  of  acquisition.   If  the  foregoing
acquisitions had occurred on January 1, 1996, they would not have had a material
impact on the results of operations for the three and  nine-month  periods ended
September 30, 1996 and 1997.

3.  Net Assets Held for Sale and Divestitures
    -----------------------------------------

In September 1996, the Company decided to divest  Katharine Gibbs Schools,  Inc.
("Katharine Gibbs"). The net assets of Katharine Gibbs were classified under the
caption net assets held for sale and were  recorded at their  carrying  value on
the accompanying  condensed  consolidated balance sheet as of December 31, 1996.
On May 30, 1997, the Company sold  Katharine  Gibbs pursuant to a stock purchase
agreement and received a portion of the purchase price. The operating results of
Katharine Gibbs prior to the  divestiture  are not material to the  consolidated
operations  of the Company and are included in the  accompanying  statements  of
condensed  consolidated  operations for the three and  nine-month  periods ended
September 30, 1996 and through the date of divestiture for the nine-month period
ended September 30, 1997.

On March 11, 1997,  the Company  announced its intention to divest the following
four non-core business units: The Daily Racing Form,  Newbridge  Communications,
Inc.  (excluding Films for the Humanities and Sciences),  New Woman magazine and
Krames Communications Incorporated ("Krames"). Subsequently, the Company decided
to sell Stagebill and Intertec Mailing Services.  These planned divestitures are
part of the Company's  plan to focus on six key growth  vehicles in markets that
have dynamic growth opportunities.

During the third  quarter,  the Company  completed  the sale of the  outstanding
stock of Krames,  certain net assets of New Woman magazine and the net assets of
Intertec Mailing Services.  The operating results of these divestitures prior to
their sale were not material to the  consolidated  operations of the Company and
are included in the accompanying statements of condensed consolidated operations
for the three and nine-month periods ended September 30, 1996 and 1997.

The remaining planned divestitures,  Newbridge  Communications,  Inc. (excluding
Films for the Humanities and Sciences),  The Daily Racing Form and Stagebill are
expected to be completed and have been  classified  under the caption net assets
held for sale and are recorded at their  aggregate  carrying value of $65,008 on
the accompanying condensed consolidated balance sheet at September 30, 1997.

Katharine  Gibbs,  Newbridge  Communications,  Inc.  (excluding  Films  for  the
Humanities and Sciences),  The Daily Racing Form,  Stagebill,  Krames, New Woman
magazine  and Intertec  Mailing  Services  are  collectively  referred to as the
Non-Core Businesses  ("Non-Core  Businesses").  The Company recorded a provision
aggregating  $138,640 for the  reduction of the carrying  values of the Non-Core
Businesses  to  the  estimated  realizable  value  of the  net  assets  of  such
businesses. The operating results of the Non-Core Businesses are included in the
accompanying  statements of condensed consolidated  operations for the three and
nine-month  periods  ended  September  30,  1996 and 1997.  Total  sales for the
Non-Core  Businesses were $79,614 and $63,226 for the three-month  periods ended
September  30, 1996 and 1997,  respectively  and  $233,076  and $205,145 for the
nine-month  periods ended September 30, 1996 and 1997,  respectively.  Excluding
the provision for the reduction of the carrying values,  operating income (loss)
for the Non-Core  Businesses was $4,424 and $6,264 for the  three-month  periods
ended September 30, 1996 and 1997, respectively and $(1,362) and $15,093 for the
nine-month periods ended September 30, 1996 and 1997 respectively.


4.  Private Offering
    ----------------
On September  26, 1997,  the Company  completed a private  offering of 1,250,000
shares of $9.20  Series E  Exchangeable  Preferred  Stock  ("Series E  Preferred
Stock") at $100 per share,  all of which are issued and outstanding at September
30, 1997.  Annual  dividends of $9.20 per share on the Series E Preferred  Stock
are  cumulative and payable  quarterly,  in cash,  commencing  February 1, 1998.
Prior to November 1, 2002, the Series E Preferred Stock may be redeemed in whole
or in part, at the option of the Company, at a redemption price equal to the sum
of the aggregate liquidation preference plus accrued and unpaid dividends to the
redemption date and the applicable  make-whole premium as defined in the private
offering prospectus.  On or after November 1, 2002, the Series E Preferred Stock
may be redeemed in whole or in part, at the option of the Company,  at specified
redemption prices plus accrued and unpaid dividends.  The Company is required to
redeem the Series E Preferred  Stock on November 1, 2009 at a  redemption  price
equal to the liquidation  preference of $100 per share,  plus accrued and unpaid
dividends.  The Series E Preferred  Stock is  exchangeable,  in whole but not in
part, at the option of the Company,  on any scheduled dividend payment date into
9.20% Class E Subordinated Debentures.  The Series E Preferred Stock is recorded
on the  accompanying  condensed  consolidated  balance  sheet  at the  aggregate
redemption  value (net of unamortized  issuance  costs) of $121,450 at September
30,  1997.  Net  proceeds  from  this  private  offering  were  used to pay down
borrowings under the bank credit facilities. (See Note 10 - Subsequent Events).

5.  Inventories
    -----------
Inventories consist of the following:

                                         December 31,             September 30,
                                             1996                      1997
                                             ----                      ----
Finished Goods                           $  41,497                $   13,293
Work in Process                              2,111                     3,053
Raw Materials                               17,838                    15,230
                                         ---------                ----------
                                            61,446                    31,576
Less allowance for obsolescence              8,703                     2,767
                                         ---------                ----------  
                                         $  52,743                $   28,809
                                         =========                ==========



6.  Long-term debt
    --------------

Long-term debt consists of the following:

                                         December 31,             September 30,
                                             1996                      1997
                                             ----                      ----
Borrowings under bank credit facilities  $   884,992              $  1,076,833
8 1/2% Senior Notes due 2006, net            298,811                   298,879
10 1/4% Senior Notes due 2004                100,000                   100,000
10 5/8% Senior Notes due 2002                233,250                         -
                                         -----------              ------------
Total                                      1,517,053                 1,475,712
Acquisition obligation payable                54,633                    55,511
                                         -----------              ------------
                                           1,571,686                 1,531,223
Less current portion                           6,000                     6,000
                                         -----------               -----------
                                         $ 1,565,686               $ 1,525,223
                                         ===========               ===========


In January 1997,  the Company  purchased,  in aggregate,  $20,850 of the 10 5/8%
Senior  Notes at a  weighted  average  price of 105%,  plus  accrued  and unpaid
interest from various  brokers on the open market.  On May 1, 1997,  the Company
redeemed the $212,400 remaining  principal amount of the 10 5/8% Senior Notes at
104% plus  accrued  and unpaid  interest.  The  aggregate  premium  paid and the
write-off of related deferred financing costs are classified as an extraordinary
charge and are  recorded at an  aggregate  value of $15,401 on the  accompanying
statement of condensed  consolidated  operations for the nine-month period ended
September 30, 1997.

The write-off of the unamortized  deferred  financing costs of $7,572 related to
the  Company's  May 1996  bank  debt  refinancing  has been  reclassified  as an
extraordinary  charge on the  accompanying  statement of condensed  consolidated
operations for the nine-month  period ended September 30, 1996 to conform to the
1997 presentation.

On April 21, 1997, the Company  entered into a new 364-day credit  facility with
The Bank of New York,  Bankers  Trust  Company,  The Bank of Nova Scotia and The
Chase Manhattan Bank as agents (the "New Credit  Facility")  which expires April
20,  1998.  Under  the  terms  of the  New  Credit  Facility,  the  Company  has
commitments of $150,000 which can be borrowed in the form of revolving loans.

The proceeds of all  revolving  loans under the New Credit  Facility can be used
for  general  corporate  and  working  capital  purposes  of the Company and its
subsidiaries,   including,   without  limitation,  the  financing  of  permitted
acquisitions.

The amounts borrowed  pursuant to the New Credit Facility bear interest at rates
per annum  identical  to those in the bank credit  facilities  at the  Company's
option as follows:  (i) the higher of (a) the Federal Funds  Effective Rate plus
1/2% and (b) the prime  lending  rate as in effect  from time to time (the "Base
Rate");  plus in each case, an applicable margin of up to 1/8 of 1% as specified
in the New Credit Facility or (ii) the Eurodollar Rate plus an applicable margin
ranging from 1/2% to 1 1/2% as specified in the New Credit Facility.

Under the New Credit  Facility,  the Company has agreed to pay  commitment  fees
equal to 1/8 of 1% per annum on the daily average aggregate unutilized revolving
loan commitment.

The  covenants  in the New Credit  Facility  are  identical to those in the bank
credit  facilities and, among other things,  limit the ability of the Company to
change the nature of its businesses,  incur certain indebtedness,  create liens,
sell assets, engage in mergers,  consolidations or transactions with affiliates,
make investments in or loans to certain  subsidiaries,  make guarantees and make
certain  restricted  payments.  The Company is also prohibited from declaring or
making  dividend  payments  on the common  stock in excess of $25,000 per annum,
unless the fixed charge  coverage  ratio,  interest  coverage ratio and leverage
ratio are at certain levels as specified in the New Credit Facility.

As under the bank credit  facilities,  borrowings  under the New Credit Facility
are guaranteed by each of the domestic wholly-owned subsidiaries of the Company.
Such  guarantees are full,  unconditional  and joint and several.  The Company's
foreign  subsidiaries  are not guarantors of the above  indebtedness.  The total
assets,  revenues,   income  or  equity  of  such  foreign  subsidiaries,   both
individually  and on a combined basis,  are  inconsequential  in relation to the
total assets, revenue, income or equity of the Company.

In May  1997,  the  Company,  through  its  bank  credit  facilities,  solicited
commitments of $150,000 under the Tranche B Revolving Loan Facility  ("Tranche B
Facility"). The Company has the right to solicit additional commitments of up to
$100,000  under the Tranche B Facility.  As of September 30, 1997,  $150,000 was
outstanding under the Tranche B Facility.

The commitments under the Tranche B Facility are subject to mandatory reductions
semi-annually  on June 30 and  December 31 with the first  reduction on June 30,
1999 and the final reduction on June 30, 2004. The mandatory  reductions for the
Tranche B Facility loan commitments are as follows:

                     Years Ending
                     December 31,
                     -----------
    1999             $   15,000
    2000                 30,000
    2001                 30,000
    2002                 30,000
    2003                 30,000
    2004                 15,000
                     ----------
                     $  150,000
                     ==========

In July 1997, the Company repaid the $80,000  outstanding  borrowings  under the
New Credit  Facility and  subsequently  borrowed an equivalent  amount under the
bank credit facilities.

In July 1997,  the Company  entered  into four,  three-year  and two,  four-year
interest rate swap  agreements,  with an aggregate  notional amount of $600,000.
Under these new swap agreements,  which commence on January 1, 1998, the Company
receives a floating rate of interest  based on three-month  LIBOR,  which resets
quarterly,  and the Company pays a fixed rate of interest, each quarter, for the
terms of the respective agreements.  The weighted average fixed rate of interest
under these agreements is 6.33%.


7.  Exchangeable Preferred Stock
    ----------------------------

Exchangeable Preferred Stock consists of the following:

                                                December 31,       September 30,
                                                    1996              1997
                                                    ----              ----
$2.875 Senior Exchangeable Preferred Stock      $  98,266        $   98,471
$11.625 Series B Exchangeable Preferred Stock     150,513           155,202
$10.00 Series D Exchangeable Preferred Stock      193,950           194,404
$9.20 Series E Exchangeable Preferred Stock             -           121,450
                                                ---------        ----------  
                                                $ 442,729        $  569,527
                                                =========        ==========


$2.875 Senior Exchangeable Preferred Stock

The  Company  authorized  4,000,000  shares of $.01 par value  Senior  Preferred
Stock,  all of which  was  issued  and  outstanding  at  December  31,  1996 and
September 30, 1997. The  liquidation  and redemption  value at December 31, 1996
and September 30, 1997 was $100,000.  In September 1997, the Company gave notice
to call all outstanding  shares of the Senior Preferred Stock effective November
3, 1997 (See Note 10 - Subsequent Events).

$11.625 Series B Exchangeable Preferred Stock

The Company  authorized  2,000,000  shares of $.01 par value  Series B Preferred
Stock,   1,531,526  shares  and  1,576,036  shares  of  which  were  issued  and
outstanding  at December  31, 1996 and  September  30, 1997,  respectively.  The
liquidation and redemption value at December 31, 1996 and September 30, 1997 was
$153,153 and $157,604, respectively.

Commencing  in the second  quarter of 1997,  the Company  elected to satisfy its
Series B Exchangeable Preferred Stock dividend requirements in cash.

$10.00 Series D Exchangeable Preferred Stock

The Company  authorized  2,000,000  shares of $.01 par value  Series D Preferred
Stock,  all of which  was  issued  and  outstanding  at  December  31,  1996 and
September 30, 1997. The  liquidation  and redemption  value at December 31, 1996
and September 30, 1997 was $200,000.

$9.20 Series E Exchangeable Preferred Stock

The Company  authorized  1,250,000  shares of $.01 par value  Series E Preferred
Stock,  all of which was issued and  outstanding  at  September  30,  1997.  The
liquidation and redemption value at September 30, 1997 was $125,000. (See Note 4
- Private Offering).

8.  Common Stock
    ------------

On September 9, 1997, the Board of Directors  authorized the Company to purchase
up to $15,000 of its outstanding common shares for cash from time to time on the
open market and  through  privately  negotiated  transactions  (the  "Repurchase
Program").  In September  1997, in accordance with the Repurchase  Program,  the
Company  purchased  46,100  shares of its  outstanding  common  stock  which was
recorded at a cost  (including  commissions)  of $549 and  classified  as common
stock in treasury on the condensed  consolidated  balance sheet at September 30,
1997.

On September 16, 1997,  the Company  purchased a block of 523,000  shares of the
Company's  common  stock  at a price  of $12  1/4 per  share.  The  shares  were
purchased in the open market through the New York Stock  Exchange.  The purchase
of  these  shares  was not  part  of the  Repurchase  Program.  The  shares  are
classified  as common stock in treasury  and are  recorded at a cost  (including
commissions) of $6,422 on the condensed  consolidated balance sheet at September
30, 1997.

9.  Loss per Common Share
    ---------------------

Loss per common share for the three and nine-month  periods ended  September 30,
1996 and 1997 was  computed  using the weighted  average  number of common stock
shares  outstanding  during each period.  The effect of the assumed  exercise of
non-qualified stock options is not included because the effect is anti-dilutive.
Loss per common  share  assuming  full  dilution is not  presented  because such
calculation is antidilutive.

10. Subsequent Events
    -----------------

On October 30,  1997,  the  Company  announced  that on November  18, 1997 it is
changing its name to PRIMEDIA Inc. to better reflect the "prime" positioning the
Company  has in six areas of  specialized  "media."  On  November  18,  1997 the
Company's New York Stock Exchange symbol will change from KCC to PRM.

On November 3, 1997 the Company  redeemed all  4,000,000  outstanding  shares of
$2.875 Senior Exchangeable  Preferred Stock at a price of $26.45 per share, plus
accrued and unpaid dividends, aggregating $105,864.



<PAGE>


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

INTRODUCTION

K-III   Communications   Corporation,   together  with  its   subsidiaries,   is
collectively  referred to as "K-III" or the  "Company." On October 30, 1997, the
Company  announced that on November 18, 1997 it is changing its name to PRIMEDIA
Inc. to better reflect the "prime"  positioning  the Company has in six areas of
specialized "media."

The  following  discussion  and analysis of the  Company's  unaudited  financial
condition  and  results of  operations  should be read in  conjunction  with the
unaudited condensed  consolidated  financial  statements and notes thereto.  The
Company  organizes  its  businesses  into three  segments:  specialty  magazines
(specialty consumer and technical and trade magazines), education (classroom and
workplace  learning)  and  information  (consumer and  business).  The specialty
magazines  segment has in prior periods been referred to as the specialty  media
segment,  but the Company  believes the new name is more reflective of the focus
of  the  segment.  Most  of the  Company's  products  are  premier  brands  with
leadership  positions  in the  specialty  niche  markets in which such  products
compete.

Management  believes a meaningful  comparison of the results of  operations  for
1996 and 1997 is obtained by using this segment  information.  This quarter, the
Company begins presenting results from "continuing businesses" which exclude the
results of the  Non-Core  Businesses,  ("Continuing  Businesses").  The Non-Core
Businesses  include  Krames,  Katharine  Gibbs,  New Woman and Intertec  Mailing
Services which have been divested;  Newbridge  Communications,  Inc.  (excluding
Films for the  Humanities  and  Sciences),  for which there is an  agreement  in
principle for sale, and The Daily Racing Form and Stagebill which are being held
for sale.  Management  believes that this presentation is the most useful way to
analyze the historical trends of the businesses.




                K-III COMMUNICATIONS CORPORATION AND SUBSIDIARIES
                  Unaudited Results of Consolidated Operations
                             (dollars in thousands)

<TABLE>
<CAPTION>
                                                         Nine Months Ended                 Three Months Ended
                                                           September 30,                      September 30,
                                                        1996          1997               1996              1997
                                                        ----          ----               ----              ----

Sales, net from:
<S>                                                <C>           <C>                 <C>            <C>
    Continuing Businesses:
      Specialty Magazines                          $   468,177   $   519,512         $   158,891    $   180,665
      Education                                        121,097       165,769              47,142         54,593
      Information                                      172,701       199,571              58,771         70,460
                                                   -----------   -----------         -----------    -----------
         Subtotal                                      761,975       884,852             264,804        305,718
    Non-Core Businesses                                233,076       205,145              79,614         63,226
                                                   -----------   -----------         -----------    -----------
         Total                                     $   995,051   $ 1,089,997         $   344,418    $   368,944
                                                   ===========   ===========         ===========    ===========

Operating income (loss) from:

    Continuing Businesses:
      Specialty Magazines                          $    46,845    $   70,393         $    20,009    $    23,098                   
      Education                                          2,079         3,287              (7,858)        (3,280)                 
      Information                                       17,127        16,637               7,634          6,878
      Corporate                                        (15,905)      (19,100)             (5,690)        (6,646)
                                                   -----------    ----------         -----------    -----------
         Subtotal                                       50,146        71,217              14,095         20,050
    Non-Core Businesses                                 (1,362)     (123,547)              4,424       (132,376)
                                                   -----------    ----------         -----------    -----------
         Total                                          48,784       (52,330)             18,519       (112,326)

Other income (expense):
      Interest expense                                 (91,313)     (103,728)            (33,716)       (34,765)
      Amortization of deferred financing
           costs                                        (2,784)       (2,323)               (917)          (741)
      Other, net                                         5,612           176               4,219            158
                                                   -----------    ----------         -----------    -----------
Loss before income tax benefit
       and extraordinary charge                        (39,701)     (158,205)            (11,895)      (147,674)
                                                                                      

Income tax benefit - carryback claim                         -         1,685                   -              -
                                                   -----------    ----------         -----------    -----------
                                                                                 
Loss before extraordinary charge                       (39,701)     (156,520)            (11,895)      (147,674)
                                                                            
Extraordinary charge - extinguishment                   
      of debt                                           (7,572)      (15,401)                  -              -             
                                                   -----------    ----------         -----------    -----------
Net loss                                           $   (47,273)   $ (171,921)        $   (11,895)   $  (147,674)
                                                   ===========    ==========         ===========    ===========
</TABLE>
<PAGE>








RESULTS OF OPERATIONS (dollars in thousands, except per share amounts)

Nine months Ended September 30, 1997 Compared to Nine Months ended September 30,
1996:

Consolidated Results:

Sales from Continuing  Businesses increased 16.1% to $884,852 in the 1997 period
over 1996 sales of $761,975.  Sales increased in all segments, with the greatest
percentage   increase  coming  from  the  education  segment  due  to  the  1996
acquisition of Westcott,  which added $29,396.  Consolidated  sales as reported,
including the Non-Core  Businesses,  increased by 9.5% to $1,089,997 in the 1997
period over 1996 reflecting the impact of the  divestitures  prior to the end of
the 1997 period.

Operating income from Continuing Businesses increased by 42.0% to $71,217 in the
1997  period  over  1996 due to  operating  income  increases  in the  specialty
magazines  and  education  segments,  with the larger  increase  coming from the
specialty  magazines segment. In 1997, the Company recorded a provision for loss
on the sales of  businesses  of $138,640,  primarily  attributable  to The Daily
Racing Form.  Consolidated operating income,  including the Non-Core Businesses,
before this provision in the 1997 period was $86,310, up 76.9% from the year ago
period.  This  increase  was  driven  by an  increase  in sales,  the  impact of
acquisitions  and a decrease in  amortization  of intangible  assets,  excess of
purchase price over net assets acquired and other, partially offset by increases
in  marketing  and  selling,  distribution,  circulation  and  fulfillment,  and
editorial  expenses.  Paper  costs,  which  in the  first  nine  months  of 1997
represented  approximately  9%  of  the  Company's  total  operating  costs  and
expenses,  were  approximately 10% lower in the first nine months of 1997 versus
the same  period in 1996.  Paper  prices have been  relatively  stable in recent
months.  Consolidated  operating  loss  as  reported,   including  the  Non-Core
Businesses  and  after  deducting  the  provision  for the loss on the  sales of
businesses,  was $52,330 in the 1997 period as compared to  operating  income of
$48,784 in 1996.

Interest  expense  increased  by $12,415,  or 13.6% in the 1997 period over 1996
primarily due to the increased level of borrowings associated with acquisitions.
The increase in the level of borrowings has slowed due to the Company's focus on
smaller acquisitions.

The  consolidated  loss  before  income tax  benefit  and  extraordinary  charge
increased  by  $118,504 to $158,205 in the first nine months of 1997 versus 1996
due primarily to the provision for loss on the sales of businesses, offset by an
increase in operating  income before the provision.  The $7,829  increase in the
extraordinary  charge reflects the aggregate  premium paid on the redemptions of
the  Company's  10 5/8%  Senior  Notes and an  additional  write-off  of related
deferred financing costs.

Specialty Magazines:

Sales from  Continuing  Businesses  increased 11.0% to $519,512 from $468,177 in
1996 due largely to internal growth. Growth was led by Seventeen, which achieved
newsstand sales of over one million copies in August,  Soap Opera Digest,  which
became a weekly  publication  during  the  period  and  strong  advertising  and
circulation  growth at many of the Company's  magazines.  The sales increase was
also impacted by advertising revenue growth, particularly in technical and trade
magazines and various acquisitions.  Excluded from Continuing Businesses in both
periods are New Woman, Stagebill and Intertec Mailing Services. Operating income
from Continuing  Businesses  increased 50.3% to $70,393 from $46,845 in 1996 due
to the sales increases as well as the decline in paper prices in 1997.


Education:

Sales from  Continuing  Businesses  increased 36.9% to $165,769 from $121,097 in
1996. The increase in sales reflects the advertising  growth at Channel One, and
acquisitions,  particularly  Westcott,  which the company  acquired in May 1996.
Excluded from Continuing Businesses in both periods are Krames,  Katharine Gibbs
and Newbridge  Communications,  Inc.  (excluding  Films for the  Humanities  and
Sciences). Operating income from Continuing Businesses increased 58.1% to $3,287
from $2,079 in 1996 due largely to new advertising and acquisitions.

Information:

Sales from  Continuing  Businesses  increased 15.6% to $199,571 from $172,701 in
1996.  The increase is largely  attributable  to strong  growth at the apartment
guides,   including  the  start-up  of  new  guides,   acquisitions  and  strong
performances  at Bacon's and the  directories  units.  Excluded from  Continuing
Businesses  in both  periods is The Daily  Racing  Form.  Operating  income from
Continuing Businesses decreased 2.9% to $16,637 from $17,127 in 1996 due largely
to  an  increase  in   amortization   of  intangible   assets   associated  with
acquisitions.

Non-Core Businesses:

Sales from the Non-Core  Businesses  declined 12.0% to $205,145 from $233,076 in
1996.  The majority of this decline  resulted from the  divestitures  of Krames,
Katharine Gibbs and New Woman prior to the end of the 1997 period. The operating
loss from Non-Core  Businesses  increased to $123,547 from $1,362 in 1996 due to
the provision for loss on the sales of businesses of $138,640 in 1997, partially
offset by a reduction in the  amortization  of  intangible  assets and excess of
purchase price over net assets acquired associated with the Non-Core Businesses.




<PAGE>


Three months Ended  September 30, 1997 Compared to Three Months ended  September
30, 1996:

Consolidated Results:

Sales from Continuing  Businesses increased 15.5% to $305,718 in the 1997 period
over 1996 sales of  $264,804.  Sales  increased  in all  segments,  with greater
growth  coming from existing  operations  than from  acquisitions.  Consolidated
sales as  reported,  including  the  Non-Core  Businesses,  increased by 7.1% to
$368,944 in the 1997 period over 1996 reflecting the impact of the  divestitures
prior to the end of the 1997 period.

Operating income from Continuing Businesses increased by 42.2% to $20,050 in the
1997 period over 1996 due to the  operating  income  increases in the  specialty
magazines  and  education  segments  with the larger  increase  coming  from the
education  segment.  In the  third  quarter  of 1997,  the  Company  recorded  a
provision for loss on sales of businesses of $138,640, primarily attributable to
The Daily Racing Form.  Consolidated  operating  income,  including the Non-Core
Businesses,  before this provision in the 1997 period was $26,314, up 42.1% from
the year ago period.  This  increase  was driven by an  increase  in sales,  the
impact of  acquisitions  and a decrease in  amortization  of intangible  assets,
excess of purchase price over net assets acquired and other, partially offset by
increases in marketing and selling,  distribution,  circulation and fulfillment,
and  editorial  expenses.  Paper costs,  which in the 1997  quarter  represented
approximately  9% of the Company's  total  operating  costs and  expenses,  were
approximately 5% lower in the 1997 quarter versus the same period in 1996. Paper
prices have been relatively stable in recent months. Consolidated operating loss
as  reported,  including  the  Non-Core  Businesses,  and  after  deducting  the
provision for loss on the sales of businesses was $112,326 in the 1997 period as
compared to operating income of $18,519 in 1996.

Interest  expense  increased  by $1,049,  or 3.1% in the 1997  period  over 1996
primarily due to the increased level of borrowings associated with acquisitions.
The  consolidated  loss  increased  by  $135,779  to $147,674 in the 1997 period
versus 1996 due primarily to the provision for loss on the sales of businesses.

Specialty Magazines:

Sales from  Continuing  Businesses  increased 13.7% to $180,665 from $158,891 in
1996 due largely to internal growth.  Growth was led by Seventeen which achieved
newsstand sales of over one million copies in August,  Soap Opera Digest,  which
continues to show revenue and  circulation  growth due to increased  circulation
frequency, and strong advertising and circulation growth at Horticulture,  Sport
Compact Car, Super Chevy,  Modern Bride,  Automobile  and others.  Acquisitions,
particularly  in the  automotive  enthusiast  field,  added to sales  during the
quarter.  The  Company is now the largest  publisher  of  automotive  enthusiast
magazines, publishing 40 titles including the top-selling automotive magazine on
the newsstand,  Low Rider. Technical and trade magazines experienced advertising
revenue growth,  particularly  Electrical  Power &  Transmission,  International
Construction and Global Telephony.  Excluded from Continuing  Businesses in both
periods are New Woman, Stagebill and Intertec Mailing Services. Operating income
from Continuing  Businesses  increased 15.4% to $23,098 from $20,009 in 1996 due
largely to the sales  increases  as well as to the  decline  in paper  prices in
1997.


Education:

Sales from  Continuing  Businesses  increased  15.8% to $54,593  from $47,142 in
1996. The increase in sales reflects the  advertising  growth at Channel One and
acquisitions  such as Cover  Concepts and QWIZ.  Westcott's  sales were modestly
lower than year ago levels reflecting the  discontinuation  of certain networks.
Excluded from Continuing Businesses in both periods are Krames,  Katharine Gibbs
and Newbridge  Communications,  Inc.  (excluding  Films for the  Humanities  and
Sciences).  Operating loss from Continuing  Businesses decreased 58.3% to $3,280
from $7,858 due largely to new advertising and acquisitions.

Information:

Sales from  Continuing  Businesses  increased  19.9% to $70,460  from $58,771 in
1996.  The increase is largely  attributable  to strong  growth at the apartment
guides,  which  continue to add new  advertisers  and  directories  and increase
distribution.  Strong  performances  at Bacon's  and the  directories  units and
certain  acquisitions  added to the sales  increase.  Excluded  from  Continuing
Businesses  in both  periods is The Daily  Racing  Form.  Operating  income from
Continuing  Businesses  decreased 9.9% to $6,878 from $7,634 in 1996 due largely
to  an  increase  in   amortization   of  intangible   assets   associated  with
acquisitions.

Non-Core Businesses:

Sales from the  Non-Core  Businesses  declined  20.6% to $63,226 from $79,614 in
1996.  The majority of this decline  resulted from the  divestitures  of Krames,
Katharine Gibbs and New Woman prior to the end of the 1997 period. The operating
loss from the Non-Core  Businesses was $132,376  compared to operating income of
$4,424  in 1996 due to the  provision  for loss on the  sales of  businesses  of
$138,640  in 1997,  partially  offset  by a  reduction  in the  amortization  of
intangible  assets  and  excess  of  purchase  price  over net  assets  acquired
associated with the Non-Core Businesses.

Liquidity and Capital Resources

Consolidated  working  capital  (deficiency)  including  current  maturities  of
long-term debt was $(19,735) at September 30, 1997 compared to a working capital
(deficiency)  of $(44,705) at December  31,  1996.  Excluding  the effect of the
reclassification  of net  assets  held for sale,  consolidated  working  capital
(deficiency)  including  current  maturities  of long-term  debt would have been
$(76,491)  at  September  30, 1997  compared to  $(69,317) at December 31, 1996.
Consolidated  working capital  (deficiency)  reflects the expensing of editorial
and  product  development  costs when  incurred  and the  recording  of deferred
revenues  as a  current  liability.  Advertising  costs  are  expensed  when the
promotional  activities  occur  except for certain  direct-response  advertising
costs which are capitalized as other  non-current  assets and amortized over the
estimated period of future benefit.

Earnings before interest,  taxes,  depreciation,  amortization and provision for
one-time  charges,  or EBITDA,  is a widely used and commonly  reported standard
measure  utilized by analysts,  investors  and other  interested  parties in the
analysis of the media industry.  EBITDA is included in the following  discussion
to provide additional  information for determining the ability of the Company to
meet its future  debt  service  requirements  and to pay cash  dividends  on its
preferred  stock.  EBITDA is not intended to represent cash flow from operations
and  should  not be  considered  as an  alternative  to net income or loss as an
indicator of the Company's  operating  performance or to cash flows as a measure
of liquidity.  This  information  is disclosed  herein to permit a more complete
comparative  analysis of the Company's operating  performance  relative to other
companies in its industry.
<PAGE>
<TABLE>
<CAPTION>

                                                          Nine Months Ended                Three Months Ended
                                                            September 30,                     September 30,
                                                        1996            1997               1996          1997
                                                        ----            ----               ----          ----

EBITDA from:
<S>                                                <C>            <C>                <C>            <C>
    Continuing Businesses:
      Specialty Magazines                          $    96,374    $    113,854       $    33,875    $    39,141
      Education                                         41,109          49,724            10,774         12,585
      Information                                       44,834          47,986            15,711         18,189
      Corporate                                        (15,336)        (19,256)           (5,485)        (6,546)
                                                   -----------    ------------       -----------    -----------
         Subtotal                                      166,981         192,308            54,875         63,369
    Non-Core Businesses                                 21,747          19,696            11,358          6,438
                                                   -----------    ------------       -----------    -----------
         Total                                     $   188,728    $    212,004       $    66,233    $    69,807
                                                   ===========    ============       ===========    ===========

Net Cash Provided by (Used in)
        Operating Activities from:

    Continuing Businesses:
      Specialty Magazines                          $    72,488    $    103,596       $    39,454    $    39,675    
      Education                                         22,038          20,541            15,298         13,237
      Information                                       40,891          43,133            10,347         15,126
      Corporate                                        (88,738)       (131,296)          (27,753)       (52,251)
                                                   -----------    ------------       -----------    -----------
         Subtotal                                       46,679          35,974            37,346         15,787
    Non-Core Businesses                                 17,157          10,143            15,375          4,928
                                                   -----------    ------------       -----------    -----------
        Total                                      $    63,836    $     46,117       $    52,721    $    20,715
                                                   ===========    ============       ===========    ===========
                                                                             
                                                 

Net Cash Provided by (Used in)
        Investing Activities from:

    Continuing Businesses:
      Specialty Magazines                          $  (200,415)   $    (63,654)      $    (6,420)   $   (19,015)
      Education                                       (432,470)        (68,088)          (11,271)        (3,861)
      Information                                      (39,474)        (47,168)           (4,791)        (3,988)
      Corporate                                           (877)         (1,200)             (425)          (544)
                                                   -----------    ------------       -----------    -----------
         Subtotal                                     (673,236)       (180,110)          (22,907)       (27,408)
    Non-Core Businesses                                (10,102)         87,207            (7,379)        85,976
                                                   -----------    ------------       -----------    -----------
         Total                                     $  (683,338)   $    (92,903)      $   (30,286)   $    58,568
                                                   ===========    ============       ===========    ===========

Net Cash Provided by (Used in)
        Financing Activities from:

    Continuing Businesses:
      Specialty Magazines                          $    (5,493)   $     (1,876)      $       (46)   $      (292)
      Education                                         (1,528)           (813)             (230)          (260)
      Information                                       (1,022)           (256)               68           (174)
      Corporate                                        634,878          35,238            (7,337)       (83,255)
                                                   -----------    ------------       -----------    -----------
         Subtotal                                      626,835          32,293            (7,545)       (83,981)
    Non-Core Businesses                                 (2,055)           (469)              (82)           123
                                                   -----------    ------------       -----------    -----------
         Total                                     $   624,780    $     31,824       $    (7,627)   $   (83,858)
                                                   ===========    ============       ===========    ===========
                                                                                                     



<PAGE>



                                                       Nine Months Ended                   Three Months Ended
                                                         September 30,                       September 30,
                                                     1996            1997                 1996            1997
                                                     ----            ----                 ----            ----

Excess (Deficiency) of Earnings
        to Fixed Charges from:

    Continuing Businesses:
      Specialty Magazines                          $    48,852    $     68,481       $    22,405    $    18,759
      Education                                          1,034           2,057            (8,139)        (3,723)
      Information                                       14,732          12,076             8,050          9,229
      Corporate                                       (102,277)       (116,583)          (38,723)       (39,380)
                                                   -----------    ------------       -----------    -----------
        Subtotal                                       (37,659)        (33,969)          (16,407)       (15,115)
    Non-Core Businesses                                 (2,042)       (124,236)            4,512       (132,559)
                                                   -----------    ------------       -----------    -----------
         Total                                     $   (39,701)   $   (158,205)      $   (11,895)   $  (147,674)
                                                   ===========    ============       ===========    ===========


Excess (Deficiency) of Earnings to
        Fixed Charges and Preferred Stock
        Dividends from:

    Continuing Businesses:
      Specialty Magazines                          $    48,852    $     68,481       $    22,405    $    18,759
      Education                                          1,034           2,057            (8,139)        (3,723)
      Information                                       14,732          12,076             8,050          9,229
      Corporate                                       (133,603)       (153,820)          (50,801)       (51,836)
                                                   -----------    ------------       -----------    -----------
         Subtotal                                      (68,985)        (71,206)          (28,485)       (27,571)
    Non-Core Businesses                                 (2,042)       (124,236)            4,512       (132,559)
                                                   -----------    ------------       -----------    -----------
         Total                                     $   (71,027)   $   (195,442)      $   (23,973)   $  (160,130)
                                                   ===========    ============       ===========    ===========   
                                                                                           
</TABLE>
                                  

EBITDA from Continuing Businesses increased 15.2% to $192,308 in the nine months
ended  September  30,  1997 over 1996  mainly as a result of growth in  existing
operations,  new product  additions and acquisitions of products and businesses.
EBITDA from Continuing  Businesses in the specialty  magazines segment increased
18.1% to $113,854  primarily due to strong  organic  growth in  circulation  and
advertising  revenue as well as savings from paper price  declines.  EBITDA from
Continuing  Businesses  in the  education  segment  increased  21.0% to  $49,724
largely  attributable  to Westcott,  which was acquired in the second quarter of
1996, other  acquisitions and strong  performance at the existing units.  EBITDA
from Continuing  Businesses in the information segment increased 7.0% to $47,986
primarily due to increases in  advertising  revenue at the apartment  guides and
distribution  revenues at the  consumer  directories.  EBITDA from the  Non-Core
Businesses  declined  9.4% to  $19,696  in 1997  primarily  as a  result  of the
divestitures during the period. Net cash provided by operating activities during
the nine months ended September 30, 1997,  after interest  payments of $113,215,
was $46,117,  a decrease of $17,719 over the same 1996 period,  due primarily to
an increase in interest payments.  Net capital  expenditures were $22,305 during
the 1997 period which was an increase of $4,202 from the 1996  period.  Payments
for  acquisitions  of $182,570  (including  certain  immaterial  purchase  price
adjustments  relating to previous  acquisitions) were made during the first nine
months of 1997.

EBITDA from  Continuing  Businesses  increased  by 15.5% to $63,369 in the three
months  ended  September  30,  1997  over  1996  mainly as a result of growth in
existing  operations,  new product  additions and  acquisitions  of products and
businesses. EBITDA from Continuing Businesses in the specialty magazines segment
increased 15.6% to $39,141 primarily due to strong organic growth in circulation
and advertising  revenues as well as savings from paper price  declines.  EBITDA
from Continuing  Businesses in the education  segment increased 16.8% to $12,585
largely  attributable to continued strong performance at Channel One and certain
acquisitions.  EBITDA from  Continuing  Businesses  in the  information  segment
increased  15.8% to $18,189  mainly  attributable  to increases  in  advertising
revenue  at  the  apartment  guides,   distribution  revenues  at  the  consumer
directories  and new product  introductions  at various  units.  EBITDA from the
Non-Core  Businesses  declined  43.3% to  $6,438 in the  third  quarter  of 1997
primarily as a result of the  divestitures as well as from declines at Newbridge
and The Daily Racing Form. Net cash provided by operating  activities during the
three months ended September 30, 1997, after interest  payments of $46,155,  was
$20,715,  a decrease of $32,006 over the same 1996 period,  due  primarily to an
increase in interest payments.  Net capital  expenditures were $7,702 during the
three months ended September 30, 1997 which was a decrease of $772 from the 1996
period.  Payments for  acquisitions  of $40,279  (including  certain  immaterial
purchase price adjustments  relating to previous  acquisitions) were made during
the three months ended September 30, 1997.

The  Company's  earnings  (defined  as pretax  income  or loss  from  continuing
operations)  are  inadequate  to cover fixed charges by $39,701 and $158,205 for
the  nine-month  periods ended  September 30, 1996 and 1997,  respectively,  and
$11,895 and $147,674 for the  three-month  periods ended  September 30, 1996 and
1997,  respectively.  The Company's  earnings  (defined as pretax income or loss
from continuing operations) are inadequate to cover fixed charges plus preferred
stock  dividends  by $71,027  and  $195,442  for the  nine-month  periods  ended
September  30, 1996 and 1997,  respectively  and $23,973  and  $160,130  for the
three-month  periods  ended  September  30, 1996 and 1997,  respectively.  Fixed
charges  consist of interest  expense on  long-term  debt and other  non-current
obligations  (including current  maturities on long-term debt),  amortization of
deferred  financing  costs,  and that portion of operating  rental  expense that
represents  interest.  Such  earnings  have been  reduced  by  non-cash  charges
(including  depreciation,  amortization,  provision  for  loss on the  sales  of
businesses and non-cash  dividends) of  approximately  $158,616 and $276,065 for
the  nine-month  periods ended  September 30, 1996 and 1997,  respectively,  and
$53,353 and $184,526 for the  three-month  periods ended  September 30, 1996 and
1997, respectively. Adjusted to eliminate these non-cash charges, earnings would
have  exceeded  fixed  charges by  approximately  $106,658  and $113,409 for the
nine-month periods ended September 30, 1996 and 1997, respectively,  and $37,255
and $36,852  for the  three-month  periods  ended  September  30, 1996 and 1997,
respectively.  Adjusted to eliminate these non-cash charges, earnings would have
exceeded fixed charges plus preferred stock dividends by  approximately  $87,589
and  $80,623  for the  nine-month  periods  ended  September  30, 1996 and 1997,
respectively,  and  $29,380  and  $24,396  for  the  three-month  periods  ended
September 30, 1996 and 1997, respectively.

Financing Arrangements
----------------------

In January 1997,  the Company  purchased,  in aggregate,  $20,850 of the 10 5/8%
Senior  Notes at a  weighted  average  price of 105%,  plus  accrued  and unpaid
interest from various  brokers on the open market.  On May 1, 1997,  the Company
redeemed the $212,400 remaining  principal amount of the 10 5/8% Senior Notes at
104% plus  accrued  and unpaid  interest.  The  aggregate  premium  paid and the
write-off of related deferred financing costs are classified as an extraordinary
charge and are  recorded at an  aggregate  value of $15,401 on the  accompanying
statement of condensed  consolidated  operations for the nine-month period ended
September 30, 1997.

The write-off of the unamortized  deferred  financing costs of $7,572 related to
the  Company's  May 1996  bank  debt  refinancing  has been  reclassified  as an
extraordinary  charge on the  accompanying  statement of condensed  consolidated
operations for the nine-month  period ended September 30, 1996 to conform to the
1997 presentation.

On April 21, 1997, the Company  entered into a new 364-day credit  facility with
The Bank of New York,  Bankers  Trust  Company,  The Bank of Nova Scotia and The
Chase Manhattan Bank as agents (the "New Credit  Facility")  which expires April
20,  1998.  Under  the  terms  of the  New  Credit  Facility,  the  Company  has
commitments of $150,000 which can be borrowed in the form of revolving loans.

The proceeds of all  revolving  loans under the New Credit  Facility can be used
for  general  corporate  and  working  capital  purposes  of the Company and its
subsidiaries,   including,   without  limitation,  the  financing  of  permitted
acquisitions.

The amounts borrowed  pursuant to the New Credit Facility bear interest at rates
per annum  identical  to those in the bank credit  facilities  at the  Company's
option as follows:  (i) the higher of (a) the Federal Funds  Effective Rate plus
1/2% and (b) the prime  lending  rate as in effect  from time to time (the "Base
Rate");  plus in each case, an applicable margin of up to 1/8 of 1% as specified
in the New Credit Facility or (ii) the Eurodollar Rate plus an applicable margin
ranging from 1/2% to 1 1/2% as specified in the New Credit Facility.

Under the New Credit  Facility,  the Company has agreed to pay  commitment  fees
equal to 1/8 of 1% per annum on the daily average aggregate unutilized revolving
loan commitment.

The  covenants  in the New Credit  Facility  are  identical to those in the bank
credit  facilities and, among other things,  limit the ability of the Company to
change the nature of its businesses,  incur certain indebtedness,  create liens,
sell assets, engage in mergers,  consolidations or transactions with affiliates,
make investments in or loans to certain  subsidiaries,  make guarantees and make
certain  restricted  payments.  The Company is also prohibited from declaring or
making  dividend  payments  on the common  stock in excess of $25,000 per annum,
unless the fixed charge  coverage  ratio,  interest  coverage ratio and leverage
ratio are at certain levels as specified in the New Credit Facility.

As under the bank credit  facilities,  borrowings  under the New Credit Facility
are guaranteed by each of the domestic wholly-owned subsidiaries of the Company.
Such  guarantees are full,  unconditional  and joint and several.  The Company's
foreign  subsidiaries  are not guarantors of the above  indebtedness.  The total
assets,  revenues,   income  or  equity  of  such  foreign  subsidiaries,   both
individually  and on a combined basis,  are  inconsequential  in relation to the
total assets, revenue, income or equity of the Company.

In May  1997,  the  Company,  through  its  bank  credit  facilities,  solicited
commitments of $150,000 under the Tranche B Revolving Loan Facility  ("Tranche B
Facility"). The Company has the right to solicit additional commitments of up to
$100,000  under the Tranche B Facility.  As of September 30, 1997,  $150,000 was
outstanding under the Tranche B Facility.

The commitments under the Tranche B Facility are subject to mandatory reductions
semi-annually  on June 30 and  December 31 with the first  reduction on June 30,
1999 and the final reduction on June 30, 2004. The mandatory  reductions for the
Tranche B Facility loan commitments are as follows:

                               Years Ending
                               December 31,
                               -----------
       1999                   $   15,000
       2000                       30,000
       2001                       30,000
       2002                       30,000
       2003                       30,000
       2004                       15,000
                              ----------
                              $  150,000
                              ==========

In July 1997, the Company repaid the $80,000  outstanding  borrowings  under the
New Credit  Facility and  subsequently  borrowed an equivalent  amount under the
bank credit facilities.

In July 1997,  the Company  entered  into four,  three-year  and two,  four-year
interest rate swap  agreements,  with an aggregate  notional amount of $600,000.
Under these new swap agreements,  which commence on January 1, 1998, the Company
receives a floating rate of interest  based on three-month  LIBOR,  which resets
quarterly,  and the Company pays a fixed rate of interest, each quarter, for the
terms of the respective agreements.  The weighted average fixed rate of interest
under these agreements is 6.33%.


Recent Developments
-------------------

On October 30,  1997,  the  Company  announced  that on November  18, 1997 it is
changing its name to PRIMEDIA Inc. to better reflect the "prime" positioning the
Company  has in six areas of  specialized  "media."  On  November  18,  1997 the
Company's New York Stock Exchange symbol will change from KCC to PRM.

On November 3, 1997 the Company  redeemed all  4,000,000  outstanding  shares of
$2.875 Senior Exchangeable  Preferred Stock at a price of $26.45 per share, plus
accrued and unpaid dividends, aggregating $105,864.

Impact of Inflation
-------------------

The impact of inflation was  immaterial  during 1996 and 1997 with the exception
of paper prices in early 1996.  Paper prices  declined  around mid-year 1996 and
continued that trend through the first six months of 1997.  Moderate paper price
increases  occurred  in July 1997 for most of the  grades  of paper  used by the
Company. In the first nine months of 1997, paper costs represented approximately
9% of the Company's  total  operating  costs and  expenses.  Postage for product
distribution and direct mail solicitations is also a significant  expense of the
Company.  The Company uses the U.S.  Postal Service for  distribution of many of
its products and marketing  materials.  Postage costs increase  periodically and
can be expected to increase in the future. In the past, the effects of inflation
on  operating  expenses  have  substantially  been offset by K-III's  ability to
increase  selling  prices.  No assurances can be given that the Company can pass
such cost increases  through to its customers.  In addition to pricing  actions,
the  Company is  continuing  to examine  all  aspects of the  manufacturing  and
purchasing processes to identify ways to offset some of these price increases.

Forward Looking Information
---------------------------

This report contains certain forward-looking statements concerning the Company's
operations,  economic performance and financial condition.  These statements are
based upon a number of assumptions and estimates which are inherently subject to
uncertainties  and  contingencies,  many of which are beyond the  control of the
Company, and reflect future business decisions which are subject to change. Some
of the assumptions may not materialize and unanticipated  events may occur which
can affect the Company's results.


Item 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not Applicable


<PAGE>


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.


                        K-III Communications Corporation
                                  (Registrant)





Date:     November 14, 1997         /s/  William F. Reilly
          -----------------        --------------------------------------------
                                                  (Signature)
                                 Chairman, Chief Executive Officer and Director
                                          (Principal Executive Officer)






Date:     November 14, 1997        /s/  Curtis A. Thompson
          -----------------        --------------------------------------------
                                                  (Signature)
                                         Vice President and Controller
                                         (Principal Accounting Officer)