<PAGE>

                   U.S. SECURITIES AND EXCHANGE COMMISSION

                           WASHINGTON, D.C.  20549

                                 FORM 10-QSB

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

        For the quarterly period ended June 30, 1998

[   ]   TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT 

        For the transition period from _______  to ________

        For the quarterly period ended ____________________

                       Commission file number:  333-29295


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

               California                              95-4298051
     (State or other jurisdiction of                (I.R.S. Employer
     incorporation or organization)                Identification No.)

                          8825 West Olympic Boulevard
                            Beverly Hills, CA  90211
                    (Address of principal executive offices)

                                 (310) 657-1745
                          (Issuer's telephone number)

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

              APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY

Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by court.  Yes [   ]   No [   ]

                   APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: Common Stock, No Par Value, 2,900,000
shares as July 24, 1998

Transitional Small Business Disclosure Format:  Yes [   ]   No [ X ]

<PAGE>

                                RETROSPETTIVA, INC.
                           NOTES TO FINANCIAL STATEMENTS
                                    (UNAUDITED)

NOTE 1 - BASIS OF PRESENTATION

The accompanying unaudited financial statements have been prepared in 
accordance with generally accepted accounting principles for interim financial 
information and in accordance with the instructions for Form 10-QSB.  
Accordingly, they do not include all of the information and footnotes required 
by generally accepted accounting principles for complete financial statements.

In the opinion of management, the financial statements contain all material 
adjustments, consisting only of normal recurring adjustments necessary to 
present fairly the financial condition, results of operations, and cash flows 
of the Company for the interim periods presented.

The results for the three and six months ended June 30, 1998 are not 
necessarily indicative of the results of operations for the full year.  These 
financial statements and related footnotes should be read in conjunction with 
the financial statements and footnotes thereto included in the Company's Form 
10-KSB filed with the Securities and Exchange Commission for the year ended 
December 31, 1997.

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

GENERAL

The Company contracts for the manufacture of a variety of garments, primarily 
basic women's sportswear which includes suits, skirts, blouses, blazers, pants, 
shorts, vests and dresses, using assorted fabrics including rayons, linens, 
cotton and wool. The Company arranges for the manufacture of garments for 
customers under private labels selected by its customers. It markets its 
products exclusively in the United States directly to large wholesalers, 
directly and indirectly to national retailers and buying organizations and 
directly to women's chain clothing stores and catalogues.

Substantially all of the Company's garments are sold on a "package" basis 
pursuant to which the Company markets at fixed prices finished garments to the 
customer's specifications and quantity requirements, arranges for the 
production of the garments and delivers the garments directly to the customer 
at the port of entry.  In its marketing, the Company emphasizes these package 
arrangements and what it believes to be the better quality and lower prices of 
garments produced by skilled Macedonian workers as compared to lower paid 
workers in certain other regions. 

As a package provider, the Company sources and purchases fabrics and trims, 
arranges for cutting and sewing, and coordinates any other services required to 
provide a completed garment.  Since the Company manufactures its finished 
products only upon receipt of purchase orders from its wholesale and retail 
customers, it therefore does not maintain an inventory of finished products. 
The Company believes that in this way it minimizes the marketing and fashion 
risk generally associated with the apparel industry.  Fabrics and trims are 
purchased from suppliers in China, India, Russia, Romania, Italy and the United 
States. After dying the fabric, if necessary, the fabric and trim are shipped 
to factories selected by the Company (primarily located in Macedonia with 
additional production facilities located in Greece, Lithuania and Romania) 
where they are manufactured into completed garments under the Company's 
management and quality control guidance.  The finished products are then 
shipped directly to New York City where the Company's customers claim the goods 
either at the port in New York City or at a consolidating warehouse in Astoria, 
New York.

<PAGE>

Except for historical information contained herein, the matters set forth may 
include forward-looking statements that are subject to risks and uncertainty 
that may cause actual results to differ materially.  Such forward-looking 
statements that may be contained in this document could include in particular 
statements concerning business back-logs, operating efficiencies and 
capacities, capital spending, and other expenses. Among other factors that 
could cause actual results to differ materially are the following; dependence 
upon unaffiliated manufacturers and fabric suppliers, dependence on certain 
customers, foreign operations, competition, risks associated with significant 
growth, uncertainties in apparel industry, general economic conditions, 
seasonality, political instability, concentration of accounts receivable and 
possible fluctuations in operating results

RESULTS OF OPERATIONS

The following table sets forth, for the periods indicated, the percentage 
relationship to net revenues of certain items in the Company's statements;

<TABLE>
<CAPTION>
                                      Three Months Ended   Six Months Ended
                                           June 30,            June 30,
                                        1997      1998      1997      1998
                                      --------------------------------------
<S>                                    <C>       <C>       <C>       <C>
Revenues                               100.0%    100.0%    100.0%    100.0%
Cost of goods sold                      85.4%     85.9%     85.3%     85.0%
Gross profit                            14.7%     14.1%     14.7%     15.0%
Selling, General and Administrative      4.4%      5.5%      4.0%      6.3%
Operating income                        10.2%      6.6%     10.7%      8.7%

</TABLE>

SIX MONTHS ENDED JUNE 30, 1998 ("1998") COMPARED TO SIX MONTHS ENDED JUNE 30,
1997 ("1997")

SALES

Sales for 1998 were $14,777,993 which represented an increase of $6,856,694 or 
86.6% over 1997 net sales of $7,921,299.  Sales of the Company's own labeled 
products and private label products were $-0- and $14,777,993 respectively, in 
1998 compared to $399,700 and $7,521,599, respectively, in 1997.  The growth in 
sales was primarily attributable to increased purchases by existing customers 
and from new customers.  Generally, the Company receives relatively small 
initial orders from new customers.  As the relationship with the customer 
continues, the purchase orders often increase substantially.  Net sales 
increases during the period reflected these increased customer orders.

COST OF GOODS SOLD

Cost of goods sold in 1998 was $12,566,750 or 85.0% of sales, an increase of 
$5,808,419 from $6,758,331 or 85.3% of sales in 1997.  The increase in cost of 
goods sold was primarily attributable to the increase in sales.  The decrease 
in the percentage of cost of goods sold was primarily attributable to improved 
management of freight costs.

GROSS PROFIT

Gross profit was $2,211,243 for 1998, an increase of $1,048,275 from $1,162,968 
for 1997.  The gross profit percentage was 15.0% in 1998, an increase from 
14.7% in 1997.  The increase in the gross profit percentage was primarily 
attributable to an increase in sales.

<PAGE>

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

Selling, general and administrative ("SG&A") expenses were $923,924 or 6.3% of 
sales for 1998, an increase of $610,415 from $313,509 or 4.0% of sales for 
1997. The increase in SG&A expense levels was primarily attributable to 
payments related to professional fees, salaries, travel expenses, license fees 
and dues (consisting primarily of the Company's NASDAQ membership fees) and 
promotion and marketing and depreciation. 

INTEREST EXPENSE

Interest expense for 1998 was $79,642 compared to $23,784 for 1997.  The 
increase in interest was primarily attributable to the increase in the 
utilization of lines of credit.

PROVISION FOR INCOME TAXES

The provision for income taxes was $510,000 and $332,870 for 1998 and 1997, 
respectively.  The increase in the provision for income taxes for the 1998 was 
primarily attributable to increased  earnings.

LIQUIDITY

The Company has 575,000 warrants outstanding with an exercise price of $7.50 
per warrant expiring September 23, 2002.  The Company has 50,000 underwriter 
warrants outstanding with an exercise price of $14.40 per unit.  Each unit 
consists of two shares of the Company's common stock and one warrant as 
described above.  The Company does not know whether the warrants will be 
exercised in 1998.  Without exercise of those warrants, the Company may need to 
limit its growth in order to more efficiently manage its available funds and 
funds generated by operations.

It is the Company's intention, however, to utilize more fully and possibly 
increase its existing line of credit with a major lending institution and its 
credit facility arrangement with a New York factoring company.  These measures 
are required due to the significant cash requirements related to increases in 
revenues.

The Company does not expect its historical rate of increase in sales growth to 
continue and further expects its rate of growth to be lower in the future as it 
begins to reach its full operating capacity constraints and utilization of its 
existing capital resources.  In the event the Company is able to obtain 
additional equity capital through the exercise, if any, of its outstanding 
warrants or other increases in potential working capital as mentioned above, 
however, the Company believes that this new working capital may allow it to 
grow more quickly.

CAPITAL RESOURCES

Since its formation, the Company has financed its operations and met its 
capital requirements primarily through cash flows from operations, customer 
advances, from principals, credit facilities, bridge loans, a private placement 
and its IPO.

The initial use of IPO funds was to repay certain debt and to purchase raw 
materials, for working capital and the eventual purchase of wool manufacturing 
equipment.  The Company's primary need for cash is for working capital 
purposes. The Company may raise capital through the issuance of long-term or 
short-term debt, or the issuance of securities in private or public 
transactions to fund future expansion of its business.  There can be no 
assurance that acceptable financing for future transactions can be obtained.

<PAGE>

INFLATION

The Company does not anticipate a significant increase in inflation in the 
United States over the short-term.  All of the Company's transactions worldwide 
are conducted on a dollar-denominated basis which is intended to mitigate the 
possible impact of volatile currencies that may arise as a result of global 
corporations crowding emerging markets in search of growth.  

SEASONALITY

The Company's revenues and operating results have exhibited some degree of 
seasonality in past periods.  Typically, the Company experiences its highest 
sales in the first and fourth quarters and its lowest sales in the second and 
third quarters.  

YEAR 2000 ISSUES

Many computer systems in use today were designed and developed using two 
digits, rather than four, to specify the year.  As a result, such systems will 
recognize the year 2000 as "00".  This could cause many computer applications 
to fail completely or to create erroneous results unless corrective measures 
are taken. The Company currently uses software and related computer 
technologies essential to its operations that the Company believes will not be 
affected by the year 2000 issue.  

The Company, however, can not determine the extent to which its vendors and 
customers may or may not be affected by the year 2000 issue.  The Company 
intends over the next 2 years to establish relationships with customers that 
may require the use of EDI (electronic data interchange) whereby all invoicing 
and payments will take place electronically over the internet through 
computers. The Company believes that since these prospective customers already 
utilize EDI, that they either have in place now, or will have successfully 
taken whatever steps are necessary to solve the year 2000 issue.

PART II.  OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

Not applicable

ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS

CHANGES IN SECURITIES

Not applicable

USE OF PROCEEDS

Not applicable

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

Not applicable

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

Not applicable

<PAGE>

ITEM 5.  OTHER INFORMATION

Not applicable

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

Not applicable


                                  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 thereto duly authorized.

Date:  August 11, 1998                 RETROSPETTIVA, INC.
                                       ------------------
                                          (Registrant)

                                       --------------------
                                       Michael D. Silberman
                                       Chief Financial Officer
                                       (Principal Accounting Officer)

<PAGE>

                                       RETROSPETTIVA, INC.
                                         BALANCE SHEETS
                                          (UNAUDITED)

                                            ASSETS
<TABLE>
<CAPTION>
                                                          JUNE 30,    DECEMBER 31,
                                                            1998          1997
                                                       ---------------------------
<S>                                                    <C>            <C>
CURRENT ASSETS
   Cash                                                $ 1,775,634    $ 1,569,905
   Accounts receivable, net, pledged                     1,799,194      2,958,770
   Due from factor                                         152,235           -  
   Note receivable                                          72,130        115,210
   Note receivable, stockholder                            354,101        288,496
   Inventories, pledged                                  9,588,254      6,389,896
   Advances to vendor                                      350,000           -  
   Advances for sales commissions                           55,000           -  
   Accrued interest receivable, stockholder                 44,488         21,042
   Other                                                    79,853         79,999
                                                       ---------------------------
       Total Current Assets                             14,270,889     11,423,318
   PROPERTY AND EQUIPMENT, at cost, net                    515,855        183,293
   DEFERRED TAX ASSETS                                      34,000         34,000
   OTHER ASSETS                                             84,534          4,610
                                                       ---------------------------
                                                       $14,905,278    $11,645,221
                                                       ---------------------------
                                                       ---------------------------

                         LIABILITIES AND STOCKHOLDERS' EQUITY


CURRENT LIABILITIES
   Accounts payable, trade                             $ 4,241,247    $ 2,881,620
   Line of credit                                        1,151,314         95,610
   Note payable                                            131,124        131,124
   Accrued expenses                                         17,824         66,140
   Due to factor                                               737           -  
   Accrued income taxes                                    177,202        160,966
   Customer advances                                       250,000        137,385
                                                       ---------------------------
       Total Current Liabilities                         5,969,448      3,472,845
                                                       ---------------------------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Preferred stock - authorized 1,000,000 shares - none
  issued or outstanding
Common stock - authorized 15,000,000 shares, no par
  value; issued and outstanding 2,900,000 and 
  2,900,000 shares, respectively                         6,258,190      6,258,190
Additional paid-in capital                                 230,000        230,000
Retained earnings                                        2,447,640      1,684,186
                                                       ---------------------------
       Total Stockholders Equity                         8,935,830      8,172,376
                                                       ---------------------------
                                                       $14,905,278    $11,645,221
                                                       ---------------------------
                                                       ---------------------------
</TABLE>

<PAGE>

                                      RETROSPETTIVA, INC.
                                     STATEMENTS OF INCOME
                                         (UNAUDITED)
<TABLE>
<CAPTION>
                                         THREE MONTHS ENDED           SIX MONTHS ENDED
                                              JUNE 30,                   JUNE 30,
                                          1997         1998          1997           1998
                                       ----------------------------------------------------
<S>                                    <C>          <C>           <C>           <C>
SALES                                  $2,827,442   $6,591,137    $7,921,299    $14,777,993

COST OF SALES                           2,413,271    5,661,787     6,758,331     12,566,750
                                       ----------------------------------------------------
GROSS PROFIT                              414,171      929,350     1,162,968      2,211,243

OPERATING EXPENSES
   Selling expenses                        46,780       95,419        94,568        207,884
   General and administrative              78,677      265,553       218,941        716,040
                                       ----------------------------------------------------
   Total Operating Expenses               125,457      360,973       313,509        923,924
                                       ----------------------------------------------------
INCOME FROM OPERATIONS                    288,714      568,378       849,459      1,287,319

OTHER INCOME (EXPENSES)
   Interest income                          4,477       24,594         4,477         42,332
   Interest income, related party            -          11,803          -            23,446
   Interest expense                       (10,520)     (27,869)      (23,784)       (79,642)
   Penalties                                 -            -             -              -  
                                       ----------------------------------------------------
Net Other Income (Expenses)                (6,043)       8,528       (19,307)       (13,864)
                                       ----------------------------------------------------
INCOME BEFORE INCOME TAXES                282,671      576,906       830,152      1,273,454

PROVISION FOR INCOME TAXES                113,000      290,000       332,870        510,000
                                       ----------------------------------------------------
NET INCOME                             $  169,671   $  286,906    $  497,282    $   763,454
                                       ----------------------------------------------------
                                       ----------------------------------------------------
NET INCOME PER SHARE, BASIC            $    0.097   $    0.099    $    0.284    $     0.263
                                       ----------------------------------------------------
                                       ----------------------------------------------------
Weighted Average Numbers of Shares
  Outstanding, Basic                    1,750,000    2,900,000     1,750,000      2,900,000
                                       ----------------------------------------------------
                                       ----------------------------------------------------
NET INCOME PER SHARE, DILUTED          $    0.097   $    0.090    $    0.284    $     0.240
                                       ----------------------------------------------------
                                       ----------------------------------------------------
Weighted Average Number of Shares
  Outstanding, Diluted                  1,750,000    3,183,456     1,750,000      3,183,456
                                       ----------------------------------------------------
                                       ----------------------------------------------------
</TABLE>

<PAGE>

                               RETROSPETTIVA, INC.
                            STATEMENTS OF CASH FLOWS
                                  (UNAUDITED)
<TABLE>
<CAPTION>
                                                         SIX MONTHS ENDED
                                                              JUNE 30,
                                                        1997          1998
                                                     -------------------------
<S>                                                  <C>          <C>
CASH FLOWS FROM (TO) OPERATING ACTIVITIES
Net income                                           $ 497,282    $   763,454
  Adjustments to reconcile net income to net cash
    provided (used) by operating activities:
    Depreciation and amortization                        8,831         30,888
    Services provided to reduce note receivable         57,087         30,675
    Utilization of deferred offering costs            (181,183)          -
    Changes in:                                           -              -
      Accounts receivable                              750,144      1,170,380
      Due from factor                                     -          (152,235)
      Prepaid license fees                                -            26,000
      Accounts receivable Mfg. Agent                                  103,330
      Accounts receivable Partnership                                (160,989)
      Prepaid expenses                                    -             5,024
      Accrued interest receivable, shareholder            -           (23,446)
      Advances to vendor                                  -          (350,000)
      Advances for sales commission                       -           (55,000)
      Inventories                                     (612,366)    (3,198,359)
      Other                                            (19,568)       (51,544)
      Accounts payable and accrued expenses           (475,814)       754,976
      Accrued income taxes                             296,764         16,236
      License fee payable                                              17,334
      Letters of credit payable                                       539,000
      Customer advances                               (392,428)       112,615
                                                     -------------------------
        Cash flows provided (used) by operating
        activities                                     (71,251)      (421,658)
                                                     -------------------------
CASH FLOWS FROM (TO) INVESTING ACTIVITIES:
  Purchase of fixed assets                              (4,609)      (363,449)
                                                     -------------------------
        Cash flows provided (used) by investing
        activities                                      (4,609)      (363,449)
                                                     -------------------------
CASH FLOWS FROM (TO) FINANCING ACTIVITIES:
  Loans to stockholder                                (230,500)      (105,466)
  Collections on note receivable, stockholder           27,406         39,862
  Proceeds from line of credit                            -         1,055,704
  Due to factor                                           -               737
  Payments on note payable                             (92,580)          -
  Payments for deferred offering costs                 (13,151)          -
  Proceeds from issuance of common stock               563,813           -
                                                     -------------------------
        Cash flows provided (used) by financing
        activities                                     254,988        990,837
                                                     -------------------------
NET INCREASE (DECREASE) IN CASH                        179,128        205,729
CASH IN BANK, beginning of period                      110,777      1,569,905
                                                     -------------------------
CASH IN BANK, end of period                          $ 289,905    $ 1,775,634
                                                     -------------------------
                                                     -------------------------
</TABLE>