<PAGE>   1
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549


                                    FORM 10-Q


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


                For the quarterly period ended September 30, 1997

                         Commission file number 0-21003


                               TWINLAB CORPORATION

             (Exact name of registrant as specified in its charter)

        Delaware                                          11-3317986
(State of incorporation)                       (IRS Employer Identification No.)

  2120 Smithtown Avenue, Ronkonkoma, New York                      11779
    (Address of principal executive office)                      (zip code)

                                 (516) 467-3140
              (Registrant's telephone number, including area code)



Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

                               YES X   NO___





At October 31, 1997, the registrant had 27,000,000 shares of common stock
outstanding.


<PAGE>   2
                                     PART I
                              FINANCIAL INFORMATION

ITEM 1:        FINANCIAL STATEMENTS

                      TWINLAB CORPORATION AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS

                (IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS)
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                     SEPTEMBER 30, 1997  DECEMBER 31, 1996 (1)
                                                          (unaudited)
<S>                                                        <C>              <C>      
ASSETS
Current Assets:
  Cash and cash equivalents                                $   5,423        $   3,794
  Accounts receivable, net of allowance for bad
     debts of $406 and $208 respectively                      33,498           31,027
  Inventories                                                 37,070           29,443
  Deferred tax assets                                          1,149            1,218
  Prepaid expenses and other current assets                    1,939            1,076
                                                           ---------        ---------
             Total Current Assets                             79,079           66,558

Property, plant and equipment, net                            13,982           14,157

Deferred tax assets                                           50,032           52,858

Other assets                                                   7,224            7,964
                                                           ---------        ---------
TOTAL                                                      $ 150,317        $ 141,537
                                                           =========        =========

LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
  Current portion of long-term debt                        $  14,085        $  20,085
  Current portion of capital lease obligations                   155              146
  Accounts payable                                            10,699           10,313
  Accrued expenses and other current liabilities               8,531            8,882
                                                           ---------        ---------
             Total Current Liabilities                        33,470           39,426
Long-term debt, less current portion                         100,247          100,265
Capital lease obligations, less current portion                   41              158
                                                           ---------        ---------
             Total Liabilities                               133,758          139,849
                                                           ---------        ---------

Commitments and contingencies

Shareholders' Equity
  Preferred stock, $.01 par value; 2,000,000 shares
     authorized; none issued
  Common stock, $1.00 par value; 75,000,000 shares
     authorized; 27,000,000 shares outstanding as of
     September 30, 1997 and December 31, 1996                 27,000           27,000
  Additional paid-in capital                                 141,338          141,338
  Accumulated deficit                                       (151,779)        (166,650)
                                                           ---------        ---------
             Total Shareholders' Equity                       16,559            1,688
                                                           ---------        ---------
TOTAL                                                      $ 150,317        $ 141,537
                                                           =========        =========
</TABLE>


(1)      The consolidated balance sheet as of December 31, 1996 has been taken
         from the audited financial statements at that date.


                                       1
<PAGE>   3
                      TWINLAB CORPORATION AND SUBSIDIARIES

                        CONSOLIDATED STATEMENTS OF INCOME
                     (IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
--------------------------------------------------------------------------------



<TABLE>
<CAPTION>
                                                         THREE MONTHS ENDED                 NINE MONTHS ENDED
                                                             SEPTEMBER 30,                     SEPTEMBER 30,
                                                     --------------------------        --------------------------
                                                        1997             1996             1997             1996
                                                       -----             ----             ----             ----
                                                            (UNAUDITED)                       (UNAUDITED)
<S>                                                  <C>              <C>              <C>              <C>      
NET SALES                                            $  49,189        $  39,393        $ 144,925        $ 121,230
COST OF SALES                                           29,122           23,830           83,694           71,682
                                                     ---------        ---------        ---------        ---------
GROSS PROFIT                                            20,067           15,563           61,231           49,548
OPERATING EXPENSES                                       9,736            7,828           27,824           22,644
                                                     ---------        ---------        ---------        ---------
INCOME FROM OPERATIONS                                  10,331            7,735           33,407           26,904
                                                     ---------        ---------        ---------        ---------
OTHER (EXPENSE) INCOME:
  Interest income                                           38              137              123              452
  Interest expense                                      (3,129)          (4,312)          (9,311)          (6,903)
  Transaction expenses                                      --               --               --             (400)
  Non recurring non-competition agreement
    expense                                                 --               --               --          (15,300)
  Other                                                     11               38               23               15
                                                     ---------        ---------        ---------        ---------
                                                        (3,080)          (4,137)          (9,165)         (22,136)
                                                     ---------        ---------        ---------        ---------
INCOME BEFORE PROVISION FOR (BENEFIT
  FROM) INCOME TAXES                                     7,251            3,598           24,242            4,768

PROVISION FOR (BENEFIT FROM) INCOME
  TAXES                                                  2,785            1,433            9,371           (2,854)
                                                     ---------        ---------        ---------        ---------
NET INCOME                                           $   4,466        $   2,165        $  14,871        $   7,622
                                                     =========        =========        =========        =========

NET INCOME PER SHARE                                 $    0.17                         $    0.55
                                                     =========                         =========
WEIGHTED AVERAGE SHARES
  OUTSTANDING                                           27,051                            27,030
                                                     =========                         =========

PRO FORMA RELATING TO CHANGE IN
  TAX STATUS*
  Historical income before provision
     for income taxes                                                 $   3,598                        $   4,768
  Pro forma provision for income taxes                                    1,439                            8,027
                                                                      ---------                        ---------
  Pro forma net income (loss) relating to
     change in tax status                                                 2,159                           (3,259)
  Preferred stock dividends                                              (2,139)                          (3,386)
                                                                      ---------                        ---------
  Net income (loss) applicable to common stock                        $      20                        $  (6,645)
                                                                      =========                        =========
   Net income (loss) per share                                        $      --                        $   (0.25)
                                                                      =========                        =========
  Weighted average shares outstanding                                    27,000                           27,000
                                                                      =========                        =========
</TABLE>



*   The Company consisted of "S" Corporations through May 7, 1996 as a result of
    which federal and state taxes were generally paid at the shareholder level
    only. The pro forma information assumes the Company had elected "C"
    Corporation status, and had not elected "S" Corporation status.


                                       2
<PAGE>   4


                      TWINLAB CORPORATION AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                            (IN THOUSANDS OF DOLLARS)
--------------------------------------------------------------------------------




<TABLE>
<CAPTION>
                                                                                                 NINE MONTHS ENDED
                                                                                                    SEPTEMBER 30,
                                                                                              1997               1996
                                                                                              ----               ----
                                                                                                    (UNAUDITED)
<S>                                                                                        <C>               <C>        
       CASH FLOWS FROM OPERATING ACTIVITIES:
         Net income                                                                        $  14,871         $     7,622
         Adjustment to reconcile net income to net cash provided by
            operating activities:
            Depreciation and amortization                                                      1,346               1,322
            Gain on disposal of equipment                                                         (2)              -
            Bad debt expense                                                                     198                 128
            Deferred income taxes                                                              2,895              (2,952)
            Nonrecurring non-competition agreement expense                                    -                   15,300
            Changes in operating assets and liabilities:
              Accounts receivable                                                             (2,669)               (827)
              Inventories                                                                     (7,627)             (5,506)
              Prepaid expenses and other current assets                                         (863)               (475)
              Accounts payable                                                                   386               3,812
              Accrued expenses and other current liabilities                                    (351)              5,396
                                                                                           ---------         -----------

                    Net cash provided by operating activities                                  8,184              23,520
                                                                                           ---------         -----------

       CASH FLOWS FROM INVESTING ACTIVITIES:
         Maturities of marketable securities                                                   -                     201
         Proceeds from sale of property plant and equipment                                    2,494                  10
         Acquisition of property, plant and equipment                                         (3,137)             (1,253)
         (Increase) decrease in other assets                                                     214              (7,145)
                                                                                           ---------         ------------

                    Net cash used in investing activities                                       (429)             (8,187)
                                                                                           ---------         ------------

       CASH FLOWS FROM FINANCING ACTIVITIES:
         Proceeds from issuance of debt                                                      -                   153,000
         Distributions to shareholders                                                       -                    (8,929)
         Proceeds from issuance of preferred stock                                           -                    67,000
         Payments of debt                                                                     (6,018)            (13,993)
         Issuance of capital stock                                                           -                     5,500
         Principal payments of capital lease obligations                                        (108)               (102)
         Repurchase of shareholders common stock and recapitalization                        -                  (217,387)
                                                                                           ---------         ------------

                    Net cash used in financing activities                                     (6,126)            (14,911)
                                                                                           ---------         -----------

       Net increase in cash and cash equivalents                                               1,629                 422
       Cash and cash equivalents at beginning of period                                        3,794               7,945
                                                                                           ---------         -----------
       Cash and cash equivalents at end of period                                          $   5,423         $     8,367
                                                                                           =========         ===========

       
       Supplemental disclosures of cash flow information: 
       Cash paid during the periods for:
            Interest                                                                       $   6,615         $     1,999
                                                                                           =========         ===========
            Income taxes                                                                   $   7,653         $     1,162
                                                                                           =========         ===========
</TABLE>


                                       3
<PAGE>   5
                      TWINLAB CORPORATION AND SUBSIDIARIES
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

           (ALL AMOUNTS IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
--------------------------------------------------------------------------------



    1. In the opinion of management, the accompanying unaudited consolidated
       financial statements include all necessary adjustments (consisting of
       normal recurring accruals) and present fairly the financial position of
       Twinlab Corporation and subsidiaries as of September 30, 1997, the
       results of its operations for the three months and nine months ended
       September 30, 1997 and 1996, and its cash flows for the nine months ended
       September 30, 1997 and 1996, in conformity with generally accepted
       accounting principles for interim financial information applied on a
       consistent basis. The results of operations for the three months and nine
       months ended September 30, 1997 are not necessarily indicative of the
       results to be expected for the full year.

       Certain information and footnote disclosures normally included in
       financial statements prepared in accordance with generally accepted
       accounting principles have been omitted. These financial statements
       should be read in conjunction with the audited consolidated financial
       statements and notes thereto included in Twinlab Corporation's December
       31, 1996 Annual Report to Stockholders on Form 10-K as filed with the
       Securities and Exchange Commission.

    2. PRO FORMA INFORMATION

       The Company completed a recapitalization transaction in May of 1996
       (including a change in the Company's tax status from "S" to "C"
       corporation status) and subsequently completed an initial public offering
       ("IPO") of its common stock in November of 1996. The following unaudited
       pro forma results of operations give effect to the Company's
       recapitalization transaction and its change from "S" to "C" corporation
       status and subsequent IPO as if each occurred as of January 1, 1996 and
       exclude the effects of $15.3 million of nonrecurring non-competition
       agreement expense and nonrecurring transaction expenses. The pro forma
       operations data have been prepared for comparative purposes only and do
       not purport to represent what the Company's actual results of operations
       would have been had the recapitalization transaction and subsequent IPO
       in fact occurred on January 1, 1996.

<TABLE>
<CAPTION>
                                                         THREE MONTHS ENDED             NINE MONTHS ENDED
                                                         SEPTEMBER 30, 1996             SEPTEMBER 30, 1996
                                                         ------------------             ------------------
                                                            (UNAUDITED)                    (UNAUDITED)
<S>                                                         <C>                             <C>         
                     Net sales                              $     39,393                    $    121,230
                     Interest expense                              3,871                           9,411
                     Net income                                    2,684                          10,763
                     Net income per share                           0.10                            0.40
</TABLE>

    3. CONDENSED AND SUMMARIZED FINANCIAL INFORMATION

       The Company's amended revolving credit facility and restrictive covenants
       contained in the indenture governing the senior subordinated notes
       restrict the payment of dividends and the making of loans, advances, or
       other distributions to Twinlab Corporation ("TLC") except in certain
       limited circumstances. The condensed financial information of TLC, on a
       stand-alone basis, is as follows:




                                       4
<PAGE>   6
<TABLE>
<CAPTION>
                                                                    SEPTEMBER 30, 1997           DECEMBER 31, 1996
                                                                    ------------------           -----------------
         CONDENSED BALANCE SHEETS                                       (UNAUDITED)
<S>                                                                   <C>                           <C>          
         ASSETS
         Cash                                                         $          167                $         162
         Investment in subsidiaries                                           16,392                        1,526
                                                                      --------------                -------------
                                                                      $       16,559                $       1,688
                                                                      ==============                =============
         SHAREHOLDERS' EQUITY
         Common stock ($1.00 par value; 75,000,000
           shares authorized; 27,000,000 outstanding                          27,000                       27,000
         Additional paid-in capital                                          141,338                      141,338
         Accumulated deficit                                                (151,779)                    (166,650)
                                                                      --------------                -------------
                                                                      $       16,559                $       1,688
                                                                      ==============                =============
</TABLE>


<TABLE>
<CAPTION>
                                                                    THREE MONTHS ENDED                NINE MONTHS ENDED
                                                                       SEPTEMBER 30,                     SEPTEMBER 30,
       CONDENSED STATEMENTS OF INCOME                               1997            1996           1997               1996
       ------------------------------                               ----            ----           ----               ----
                                                                         (UNAUDITED)                       (UNAUDITED)
<S>                                                               <C>             <C>             <C>              <C>       
         Equity interest in net income of subsidiaries            $ 4,495         $  2,165        $   15,028       $    7,622
         Interest income                                                2           -                      5          -
                                                                  -------         --------        ----------       ----------
         Income (loss) before provision for income taxes            4,497            2,165            15,033            7,622
         Provision for income taxes                                    31           -                    162          -
                                                                  -------         --------        ----------       ----------
         Net income (loss)                                        $ 4,466         $  2,165        $   14,871       $    7,622
                                                                  =======         ========        ===========      ==========
</TABLE>


<TABLE>
<CAPTION>
                                                                                NINE MONTHS ENDED
                                                                                  SEPTEMBER 30,
         CONDENSED STATEMENTS OF CASH FLOWS                               1997                  1996
         ----------------------------------                               ----                  ----
                                                                                   (UNAUDITED)
<S>                                                                     <C>                 <C>        
           CASH FLOWS FROM OPERATING ACTIVITIES
               Net income                                               $  14,871           $     7,622
                                                                        ---------           -----------
           CASH FLOWS FROM INVESTING ACTIVITIES
               Equity investments in subsidiaries                         (14,866)              144,544
                                                                        ---------           -----------
           CASH FLOWS FROM FINANCING ACTIVITIES
               Distributions to shareholders                              -                      (8,929)
               Proceeds from issuance of preferred stock                  -                      67,000
               Issuance of capital stock                                  -                       5,500
               Repurchase of shareholders' common stock
                  and recapitalization                                    -                    (215,737)
                                                                        ---------           -----------
               Net cash used in financing activities                      -                    (152,166)
                                                                        ---------           -----------
           Net increase in cash                                                 5              -
           Cash at beginning of period                                        162              -
                                                                        ---------           -----------
           Cash at end of period                                        $     167           $  -
                                                                        =========           ===========
</TABLE>

     Twin Laboratories Inc. ("Twin") and Advanced Research Press. ("ARP") are,
     respectively, a direct and indirect wholly-owned subsidiary of TLC. TLC and
     ARP have provided joint and several, full and unconditional senior
     subordinated guarantees of the senior subordinated notes of Twin.

     The assets, results of operations and shareholders' equity of Twin comprise
     substantially all of the assets, results of operations and shareholders'
     equity of TLC on a consolidated basis. TLC has no separate operations and
     has no significant assets other than TLC's investment in Twin and, through
     Twin, in ARP. Twin has no direct or indirect subsidiaries other than ARP;
     and neither Twin nor ARP has any stockholder other than respectively, TLC
     and Twin. Accordingly, the Company has determined that separate financial
     statements of Twin and ARP would not be material to investors and,
     therefore, are not included herein.


                                       5
<PAGE>   7



         Summarized financial information of Twin is as follows:

<TABLE>
<CAPTION>
                                                 AS OF SEPTEMBER 30, 1997               AS OF DECEMBER 31, 1996
                                                 ------------------------               -----------------------
                                                        (UNAUDITED)
<S>                                                   <C>                                   <C>       
         Current assets                               $    80,778                           $   68,100
         Noncurrent assets                                 71,238                               74,979
         Current liabilities                               33,470                               39,426
         Noncurrent liabilities                           100,288                              100,423
         Shareholders' equity                              18,258                                3,230
</TABLE>

<TABLE>
<CAPTION>
                                        THREE MONTHS ENDED SEPTEMBER 30,             NINE MONTHS ENDED SEPTEMBER 30,
                                        --------------------------------             -------------------------------
                                           1997                  1996                     1997               1996
                                                     (UNAUDITED)                                  (UNAUDITED)
<S>                                   <C>                     <C>                       <C>                  <C>      
         Net sales                    $    49,189             $    39,393               $ 144,925            $ 121,230
         Gross profit                      20,067                  15,563                  61,231               49,548
         Net income                         4,495                   2,165                  15,028                7,622
</TABLE>


     Summarized financial information of ARP is as follows:

<TABLE>
<CAPTION>
                                                 AS OF SEPTEMBER 30, 1997                AS OF DECEMBER 31,1996
                                                 ------------------------                ----------------------
                                                        (UNAUDITED)
<S>                                                    <C>                                   <C>      
         Current assets                                $  1,453                              $   1,577
         Noncurrent assets                                  195                                    182
         Current liabilities                                715                                  1,200
         Noncurrent liabilities                            -                                      -
         Shareholder's equity                               933                                    559
</TABLE>

<TABLE>
<CAPTION>
                                           THREE MONTHS ENDED SEPTEMBER 30,           NINE MONTHS ENDED SEPTEMBER 30,
                                           --------------------------------           -------------------------------
                                              1997                 1996                1997                1996
                                                     (UNAUDITED)                                (UNAUDITED)
<S>                                       <C>                 <C>                   <C>                 <C>     
         Net sales                        $   1,388           $   1,408             $   4,341           $  4,446
         Gross profit                           325                 125                 1,029                592
         Net income                             133                  41                   374                317
</TABLE>

    4. INVENTORIES

       Inventories consist of the following:

<TABLE>
<CAPTION>
                                                      SEPTEMBER 30, 1997               DECEMBER 31, 1996
                                                      ------------------               -----------------
                                                         (UNAUDITED)
<S>                                                      <C>                            <C>         
         Raw Materials                                   $      14,925                  $     10,802
         Work in Process                                        10,104                         8,712
         Finished Goods                                         12,041                         9,929
                                                         -------------                  ------------
                    Total                                $      37,070                  $     29,443
                                                         =============                  ============
</TABLE>

    5.   SUBSEQUENT EVENT

        On November 12, 1997, the Company acquired Changes International of Fort
        Walton Beach, Inc. ("Changes") for a purchase price of $12,500,000,
        consisting of $6,250,000 in cash and 312,250 shares Twinlab Corporation
        common stock. The cash portion of the purchase price was financed
        through borrowings under the Company's amended revolving credit
        facility. Changes operates as a network marketer of  nutritional
        supplements through independent distributors located primarily
        throughout the United States and Canada. The acquisition will be
        recorded using the purchase method of accounting.


                                       6
<PAGE>   8
     ITEM 2.: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
     RESULTS OF OPERATIONS

    GENERAL

    The following discussion and analysis should be read in conjunction with
    the response to Part I, Item 1 of this report.

    The Company operates in one business segment, the manufacture and marketing
    of brand name and private label nutritional supplements. Within this
    segment, the Company operates in two primary business areas: the TWINLAB
    Division and the herbal products category. Products sold under the TWINLAB
    brand name include vitamins, minerals, amino acids, fish and marine oils,
    sports nutrition products and special formulas. The herbal products category
    includes a full line of herbal supplements and phytonutrients marketed by
    the Nature's Herbs Division and a full line of herb teas marketed by the
    Alvita Tea Division. In addition, the Company's publishing activities are
    conducted through its subsidiary, Advanced Research Press, Inc.

    RESULTS OF OPERATIONS

    NINE MONTHS ENDED SEPTEMBER 30, 1997 COMPARED TO NINE MONTHS ENDED SEPTEMBER
    30, 1996

    NET SALES: Net sales for the nine months ended September 30, 1997 were
    $144.9 million, an increase of $23.7 million, or 19.6%, as compared to net
    sales of $121.2 million for the nine months ended September 30, 1996. The
    19.6% increase was attributable to increased demand for the Company's
    products resulting in increased gross sales, partially offset by an increase
    in discounts and allowances related to the Company's increased sales volume.
    The increase in net sales was primarily due to the expansion of established
    accounts, improved business development in other channels of distribution,
    increased sales of existing products, new product introductions, and product
    specific advertising. TWINLAB brand net sales contributed $112.1 million, an
    increase of $15.4 million, or 16.0%, as compared to $96.7 million for the
    nine months ended September 30, 1996. Herbal products contributed $29.0
    million, an increase of $8.4 million, or 40.8%, as compared to $20.6 million
    for the nine months ended September 30, 1996. Publishing activities
    contributed $3.8 million as compared to $3.9 million for the nine months
    ended September 30, 1996.

    GROSS PROFIT: Gross profit for the nine months ended September 30, 1997 was
    $61.2 million, which represented an increase of $11.7 million, or 23.6%, as
    compared to $49.5 million for the nine months ended September 30, 1996.
    Gross profit margin was 42.3% for the nine months ended September 30, 1997
    as compared to 40.9% for the nine months ended September 30, 1996. The
    overall increase in gross profit dollars was primarily attributable to the
    Company's higher sales volume for the nine months ended September 30, 1997.
    The increase in gross profit margin for the nine months ended September 30,
    1997 as compared to the nine months ended September 30, 1996 was due
    primarily to a more favorable product mix, to higher gross profit margins on
    recently introduced new product formulations and product line extensions,
    and to lower unit manufacturing overhead as a result of overhead costs
    increasing at a rate lower than sales partially offset by an increase in
    credits and discounts.

    OPERATING EXPENSES: Operating expenses were $27.8 million for the nine
    months ended September 30, 1997, representing an increase of $5.2 million,
    or 22.9%, as compared to $22.6 million for the nine months ended September
    30, 1996. As a percent of net sales, operating expenses increased from 18.7%
    for the nine months ended September 30, 1996 to 19.2% for the nine months
    ended September 30, 1997. The increase in operating expenses in dollars and
    as a percent of net sales was primarily attributable to increased selling
    and marketing expenses and higher general and administrative expense due to
    increased level of promotional and sales activities and expenses related to
    increasing the size of the administrative staff and approximately $0.4
    million (0.3% of sales) of costs associated with the cancelled merger with
    Rexall Sundown, Inc.

    INCOME FROM OPERATIONS: Income from operations was $33.4 million for the
    nine months ended September 30, 1997, representing an increase of $6.5
    million, or 24.2%, as compared to $26.9 million for the nine months ended
    September 30, 1996. Income from operations margin increased to 23.1% of net
    sales for the nine months ended September 30, 1997, as compared to 22.2% of
    net sales for the nine months ended September 30, 1996. The increase in
    income from operations and income from operations margin was primarily due
    to the 

                                       7
<PAGE>   9
    Company's higher sales volume together with higher gross margins, offset in
    part by higher operating expenses as a percent of net sales for the nine
    months ended September 30, 1997.

    OTHER EXPENSE: Other expense was $9.2 million for the nine months ended
    September 30, 1997, as compared to $22.1 million for the nine months ended
    September 30, 1996. The net decrease of $12.9 million is primarily
    attributable to a $15.7 million decrease in nonrecurring non-competition
    agreement expense and transaction expenses which were incurred in 1996
    offset by an increase in interest expense of $2.4 million resulting from
    increased borrowings.

    THREE MONTHS ENDED SEPTEMBER 30, 1997 COMPARED TO THREE MONTHS ENDED
    SEPTEMBER 30, 1996

    NET SALES: Net sales for the three months ended September 30, 1997 were
    $49.2 million, an increase of $9.8 million, or 24.9%, as compared to net
    sales of $39.4 million for the three months ended September 30, 1996. The
    24.9% increase was attributable to demand for the Company's products,
    resulting in increased gross sales, partially offset by an increase in
    discounts and allowances related to the Company's increased sales volume.
    The increase in net sales was primarily due to the expansion of established
    accounts, improved business development in other channels of distribution,
    increased sales of existing products, and product specific advertising. Net
    sales of TWINLAB products contributed $35.2 million, an increase of $3.5
    million or 10.4% as compared to $31.7 million for the three months ended
    September 30, 1996. Herbal products contributed $12.8 million, an increase
    of $6.3 million, or 97.2% as compared to $6.5 million for the three months
    ended September 30, 1996. Publishing activities contributed $1.2 million for
    the three months ended September 30, 1997 and 1996.

    GROSS PROFIT: Gross profit for the three months ended September 30, 1997 was
    $20.1 million, which represented an increase of $ 4.5 million, or 28.9%, as
    compared to $15.6 million for the three months ended September 30, 1996.
    Gross profit margin was 40.8% for the three months ended September 30, 1997
    as compared to 39.5% for the three months ended September 30, 1996. The
    overall increase in gross profit dollars and margin was primarily
    attributable to the Company's higher sales volume and favorable product mix
    for the three months ended September 30, 1997.

    OPERATING EXPENSES: Operating expenses were $9.7 million for the three
    months ended September 30, 1997 representing an increase of $1.9 million, or
    24.4%, as compared to $7.8 million for the three months ended September 30,
    1996. Operating expenses as a percent of net sales remained consistent for
    the three months ended September 30, 1997 and 1996. The increase in
    operating expenses in dollars was primarily attributable to increased
    selling and marketing expenses and higher general and administrative expense
    due to increased level of promotional and sales activities and expenses
    related to increasing the size of the administrative staff and approximately
    $0.4 million (0.9% of sales) of costs associated with the cancelled merger
    with Rexall Sundown, Inc..

    INCOME FROM OPERATIONS: Income from operations was $10.3 million for the
    three months ended September 30,1997, representing an increase of $2.6
    million, or 33.6%, as compared to $7.7 million for the three months ended
    September 30, 1996. Income from operations margin increased to 21.0% of net
    sales for the three months ended September 30, 1997 as compared to 19.6% of
    net sales for the three months ended September 30, 1996. The increase in
    income from operations and income from operations margin was primarily due
    to the Company's higher sales volume together with higher gross margins,
    offset in part by lower operating expenses as a percent of net sales for the
    three months ended September 30, 1997.

    OTHER EXPENSE: Other expense was $3.1 million for the three months ended
    September 30, 1997, as compared to $4.1 million for the three months ended
    September 30, 1996. The net decrease of $1.0 million is primarily
    attributable to a decrease in interest expense resulting from decreased
    borrowings.

    LIQUIDITY AND CAPITAL RESOURCES

    For the nine months ended September 30, 1997, cash provided by operating
    activities was $8.2 million, as compared to $23.5 million for the nine
    months ended September 30, 1996. Cash used in financing activities was $6.1
    million for the nine months ended September 30, 1997, and represented
    repayment of certain outstanding indebtedness. Cash used in financing
    activities for the nine months ended September 30, 1996 

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<PAGE>   10
    was $14.9 million, reflecting the net cash effect of the recapitalization
    transaction, the repayment of $6.0 million of outstanding indebtedness and
    distributions of $8.9 million to the stockholders.

    Capital expenditures were $3.1 million ($2.5 million of which was
    subsequently sold and leased back) and $1.3 million for the nine months
    ended September 30, 1997 and 1996, respectively. Historical capital
    expenditures were primarily used to purchase production equipment, expand
    capacity and improve manufacturing efficiency. Capital expenditures are
    expected to be approximately $4.0 million during the calendar year 1997 (of
    which $3.1 million are expected to be sold and leased back) and will be used
    primarily to purchase manufacturing equipment. The Company estimates that
    its historical level of maintenance capital property, plant and equipment
    has been approximately $0.5 million per fiscal year.

    TLC has no operations of its own and accordingly has no independent means of
    generating revenue. As a holding company, TLC's internal sources of funds to
    meet its cash needs, including payment of expenses, are dividends and other
    permitted payments from its direct and indirect subsidiaries. The indenture,
    dated as of May 7, 1996, among TLC, Twin Laboratories Inc., ARP and Fleet
    National Bank (now State Street Bank and Trust Co.), as trustee, relating to
    the senior subordinated notes and the amended revolving credit facility
    impose upon the Company certain financial and operating covenants,
    including, among others, requirements that the Company maintain certain
    financial ratios and satisfy certain financial tests limitations on capital
    expenditures and restrictions on the ability of the Company to incur debt,
    pay dividends or take certain other corporate actions.

    Management believes that the Company has adequate capital resources and
    liquidity to meet its borrowing obligations, fund all required capital
    expenditures and pursue its business strategy. The Company's capital
    resources and liquidity are expected to be provided by the Company's cash
    flow from operations, and borrowings under its amended revolving credit
    facility. As October 31, 1997, approximately $36 million of borrowings
    were available under the amended revolving credit facility for working
    capital requirements and general corporate purposes.

    One of the Company's business strategies is to pursue acquisition
    opportunities, including product line acquisitions, that complement its
    existing products, expand its distribution channels or are compatible with
    its business philosophy and strategic goals. Future acquisitions could be
    financed by internally generated funds, bank borrowings, public offerings or
    private placements of equity or debt securities, or a combination of the
    foregoing. Up to $35 million of borrowings under the amended revolving
    credit facility is available to fund acquisitions subject to certain
    conditions and reductions (approximately $17.3 million of which is available
    as of November 12, 1997). There can be no assurance that the Company will be
    able to make acquisitions on terms favorable to the Company and that funds
    to finance an acquisition will be available or permitted under the Company's
    financing instruments.

    On November 12, 1997, the Company acquired Changes International of Fort
    Walton Beach, Inc. ("Changes") for a purchase price of $12,500,000,
    consisting of $6,250,000 in cash and 312,250 shares of Twinlab Corporation
    common stock. The cash portion of the purchase price was financed through
    borrowings under the Company's amended revolving credit facility. Changes
    operates as a network marketer of nutritional supplements through
    independent distributors located primarily throughout the United States and
    Canada. The acquisition will be recorded using the purchase method of
    accounting.

    CERTAIN FACTORS THAT MAY AFFECT FUTURE RESULTS

    Information contained or incorporated by reference in this periodic report
    on Form 10-Q and in other SEC filings by the Company contains
    "forward-looking statements" within the meaning of the Private Securities
    Litigation Reform Act of 1995 which can be identified by the use of
    forward-looking terminology such as "believes," "expects," "may," "will,"
    "should" or "anticipates" or the negative thereof of other variations
    thereon or comparable terminology, or by discussions of strategy. No
    assurance can be given that future results covered by the forward-looking
    statements will be achieved, and other factors could also cause actual
    results to vary materially from the future results covered in such
    forward-looking statements.


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                                     PART II
                                OTHER INFORMATION


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

      There were no submissions of matters to a vote of security holders.

ITEM 6: EXHIBITS AND REPORTS ON FORM 8-K

(a)   Exhibits:

      27   Financial Data Schedule.

(b)   Reports of Form 8-K:

   
      No reports on Form 8-K were filed by the Company during the three months
      ended September 30, 1997.
    




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                                   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.





                         TWINLAB CORPORATION




                   By:   /s/ Ross Blechman
                         Ross Blechman
                         Chairman, President and Chief Executive Officer




   
                   By:   /s/ Brian Blechman
                         Brian Blechman
                         Executive Vice President - Treasurer
                         (Principal Accounting Officer)
    




   
                   By:   /s/ John McCusker
                         John McCusker
                         Chief Financial Officer
                         (Principal Financial Officer)
    



   
DATED:  November 13, 1997
    



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