U.S. SECURITIES AND EXCHANGE COMMISSION
                           WASHINGTON, D.C. 20549-1004

                                    FORM 10-Q

(Mark one)
[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934.

For the quarterly period ended August 31, 1999 or

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

For the transition period from __________ to _________.

                         Commission File Number: 0-22889

                              ROYAL PRECISION, INC.
             (Exact Name of Registrant as Specified in Its Charter)

         Delaware                                                06-1453896
(State or Other Jurisdiction of                               (I.R.S. Employer
Incorporation or Organization)                               Identification No.)

15170 North Hayden Road, Suite 1, Scottsdale, AZ                    85260
     (Address of Principal Executive Offices)                     (Zip code)

                                 (480) 627-0200
              (Registrant's Telephone Number, Including Area Code)

              (Former Name, Former Address and Former Fiscal Year
                         if Changed Since Last Report)

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 [ ]

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock, as of the latest practicable date:

         Title of each class               Outstanding at October 14, 1999
         -------------------               -------------------------------

    Common Stock, par value $.001                 5,670,130 Shares
<PAGE>
                                     PART I
                              FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

                     ROYAL PRECISION, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                             (dollars in thousands)

                                                           AUGUST 31,   MAY 31,
                                                             1999        1999
                                                          -----------  ---------
                                                          (unaudited)
                                     ASSETS
CURRENT ASSETS:
   Cash                                                    $     48    $    184
   Accounts receivable, net of allowance for
     doubtful accounts of $443 at August 31, 1999
     and $433 at May 31, 1999                                 2,277       4,617
   Inventories                                                5,225       4,514
   Other current assets                                         578         783
   Deferred income taxes                                        647         647
                                                           --------    --------
       Total current assets                                   8,775      10,745
                                                           --------    --------
PROPERTY, PLANT AND EQUIPMENT:
   Land                                                         123         123
   Furniture, fixtures and office equipment                     513         499
   Buildings and improvements                                   670         670
   Machinery and equipment                                    4,167       4,144
   Construction in progress                                     899         402
                                                           --------    --------
                                                              6,372       5,838
   Less - Accumulated depreciation                           (1,106)       (929)
                                                           --------    --------
                                                              5,266       4,909
                                                           --------    --------
GOODWILL, net                                                 8,735       8,857
                                                           --------    --------
DEFERRED INCOME TAXES                                            70          70
                                                           --------    --------
OTHER ASSETS                                                     27          29
                                                           --------    --------
       Total assets                                        $ 22,873    $ 24,610
                                                           ========    ========

                      LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
   Current portion of long-term debt and capital
     lease obligations                                     $  1,031    $  1,203
   Accounts payable                                           1,263       1,839
   Accrued salaries and benefits                                547         595
   Accrued pension liability                                    158         251
   Other accrued expenses                                     1,200       1,079
                                                           --------    --------
       Total current liabilities                              4,199       4,967

LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS,
  less current portion included above                         4,928       6,191
                                                           --------    --------
       Total liabilities                                      9,127      11,158
                                                           --------    --------
COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY:
  Preferred stock, $.001 par value; 5,000,000 shares
    authorized; no shares issued                                 --          --
  Common stock, $.001 par value; 50,000,000 shares
    authorized; 5,670,130 and 5,667,375 shares
    issued and outstanding at August 31, 1999
    and May 31, 1999, respectively                                6           6
  Additional paid-in capital                                 13,897      13,897
  Accumulated deficit                                          (110)       (404)
  Accumulated other comprehensive loss                          (47)        (47)
                                                           --------    --------
       Total stockholders' equity                            13,746      13,452
                                                           --------    --------
       Total liabilities and stockholders' equity          $ 22,873    $ 24,610
                                                           ========    ========

         The accompanying notes are an integral part of these condensed
                       consolidated financial statements.

                                      -2-
<PAGE>
                     ROYAL PRECISION, INC. AND SUBSIDIARIES
           CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
                (dollars in thousands, except per share amounts)

                                                            THREE MONTHS ENDED
                                                          ----------------------
                                                          AUGUST 31,  AUGUST 31,
                                                             1999        1998
                                                          ----------  ----------
NET SALES:
  Golf club shafts                                         $ 5,286     $ 5,001
  Golf club grips                                            1,230       1,037
                                                           -------     -------
                                                             6,516       6,038
                                                           -------     -------
COST OF SALES:
  Golf club shafts                                           3,219       3,274
  Golf club grips                                              850         551
                                                           -------     -------
                                                             4,069       3,825
                                                           -------     -------
      Gross profit                                           2,447       2,213

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES                 1,761       1,895
                                                           -------     -------

      Operating income                                         686         318

INTEREST EXPENSE                                               151         161

OTHER INCOME                                                    55          61
                                                           -------     -------
      Income from continuing operations before
        provision for income taxes                             590         218

PROVISION FOR INCOME TAXES                                     296           5
                                                           -------     -------
      Income from continuing operations                        294         213

DISCONTINUED OPERATIONS:
    Loss from operations of Roxxi, Inc.                         --         210
                                                           -------     -------
      Net income                                           $   294     $     3
                                                           =======     =======

BASIC AND DILUTED EARNINGS (LOSS) PER SHARE:
  Income from continuing operations                        $  0.05     $  0.04
  Loss from discontinued operations                             --       (0.04)
                                                           -------     -------
  Net income                                               $  0.05     $    --
                                                           =======     =======

         The accompanying notes are an integral part of these condensed
                       consolidated financial statements.

                                      -3-
<PAGE>
                     ROYAL PRECISION, INC. AND SUBSIDIARIES
           CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
                             (dollars in thousands)

                                                            THREE MONTHS ENDED
                                                          ----------------------
                                                          AUGUST 31,  AUGUST 31,
                                                             1999        1998
                                                          ----------  ----------
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net income from continuing operations                    $   294     $   213
  Adjustments to reconcile net income from continuing
    operations to net cash provided by operating
    activities --
   Cash loss from discontinued operations                       --        (137)
   Depreciation and amortization                               304         231
   Loss on retirement or write-off of fixed assets               7          --
   Changes in operating assets and liabilities --
    Accounts receivable, net                                 2,340       1,381
    Inventories                                               (711)        149
    Other assets                                               207          51
    Accounts payable and accrued expenses                     (596)       (584)
    Other liabilities                                           --         (43)
                                                           -------     -------

  Net cash provided by operating activities                  1,845       1,261
                                                           -------     -------

CASH FLOWS FROM INVESTING ACTIVITIES:
  Payments from net investment in capital lease                 --          78
  Purchases of equipment, net                                 (546)       (334)
                                                           -------     -------

  Net cash used in investing activities                       (546)       (256)
                                                           -------     -------

CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from exercise of common stock options
    and warrants                                                --          13
  Repayments under lines-of-credit, net                     (1,036)       (784)
  Repayments of long-term debt and capital lease
    obligations                                               (399)       (262)
                                                           -------     -------

  Net cash used in financing activities                     (1,435)     (1,033)
                                                           -------     -------

DECREASE IN CASH                                              (136)        (28)

CASH, beginning of period                                      184          28
                                                           -------     -------

CASH, end of period                                        $    48     $    --
                                                           =======     =======

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
  Cash paid during the period for --
    Interest                                               $   204      $   205
                                                           =======      =======
    Income taxes                                           $    31      $    17
                                                           =======      =======

         The accompanying notes are an integral part of these condensed
                       consolidated financial statements.

                                      -4-
<PAGE>
                     ROYAL PRECISION, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

1.   OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES:

     BASIS OF PRESENTATION --

     The condensed  consolidated  financial statements of Royal Precision,  Inc.
     and  subsidiaries  (collectively,  "RP" or the "Company")  presented herein
     have been  prepared  pursuant to the rules of the  Securities  and Exchange
     Commission for quarterly reports on Form 10-Q and do not include all of the
     information and note disclosures  required by generally accepted accounting
     principles.  These condensed  consolidated  financial  statements should be
     read in conjunction with the Company's  consolidated  financial  statements
     and notes thereto for the year ended May 31, 1999 included in the Company's
     Form  10-KSB.  In the opinion of  management,  the  accompanying  unaudited
     condensed   consolidated  financial  statements  include  all  adjustments,
     consisting  of only  normal  recurring  adjustments,  necessary  to present
     fairly the consolidated financial position,  results of operations and cash
     flows of the  Company.  Quarterly  operating  results  are not  necessarily
     indicative of the results that would be expected for the full year.

     ORGANIZATION --

     The accompanying  condensed consolidated financial statements include Royal
     Precision, Inc. and its three wholly-owned subsidiaries,  FM Precision Golf
     Manufacturing  Corp.  ("FMP"),  FM Precision Golf Sales Corp. ("FMP Sales")
     and Royal Grip, Inc. ("RG") which has a wholly-owned subsidiary, Royal Grip
     Headwear Company.  All significant  intercompany  balances and transactions
     have been eliminated in consolidation.  As discussed in Note 7, the Company
     disposed of the operating assets of Royal Grip Headwear  Company  (formerly
     known as Roxxi,  Inc.  "Roxxi") in March 1999.  Results of  operations  for
     Roxxi for all periods  through May 31, 1999 are  reflected as  discontinued
     operations.

     BUSINESS --

     RP is a holding  company which carries on its business  operations  through
     its subsidiaries. FMP is a manufacturer and distributor of golf club shafts
     which are sold to original equipment  manufacturers and to distributors and
     retailers for use in the  replacement  market.  RG designs and  distributes
     golf club grips.  RP's  products are sold  throughout  the United States as
     well as internationally,  primarily in Japan, Australia, the United Kingdom
     and Canada.

     USE OF ESTIMATES --

     The  preparation  of financial  statements  in  conformity  with  generally
     accepted  accounting  principles  requires management to make estimates and
     assumptions  that affect the reported amounts of assets and liabilities and
     disclosure  of  contingent  assets  and  liabilities  at  the  date  of the
     financial  statements  such as the estimate for  impairment  of  long-lived
     assets  and the  reported  amounts  of  revenues  and  expenses  during the
     reporting period. Actual results could differ from those estimates.

2.   EARNINGS (LOSS) PER SHARE:

     The Company  accounts for earnings (loss) per share in accordance with SFAS
     No. 128, "Earnings Per Share." Basic earnings (loss) per share are based on
     the average number of common shares outstanding during the period.  Diluted
     earnings  (loss) per share  assumes,  in addition to the above,  a dilutive
     effect  of  common  share  equivalents  during  the  period.  Common  share
     equivalents  represent  dilutive  stock  options  using the treasury  stock
     method.  The number of shares  used in  computing  income  from  continuing
     operations  per share for the three  months  ended August 31, 1999 and 1998
     were as follows (in thousands):

                                      -5-
<PAGE>
                                                         1999        1998
                                                         ----        ----
          Basic:
            Average common shares outstanding            5,668       5,602

          Diluted:
            Dilutive effect of stock options               138         107
                                                         -----       -----
            Average common shares outstanding            5,806       5,709
                                                         =====       =====

     As of August 31, 1998, basic and diluted average common shares  outstanding
     for  discontinued  operations  were 5,602,000.  Basic and diluted  earnings
     (loss) per share were the same for the three  months  ended August 31, 1999
     and 1998.

3.   NEW ACCOUNTING PRONOUNCEMENT:

     In June 1998,  the FASB  issued SFAS No. 133,  "Accounting  for  Derivative
     Instruments  and  Hedging   Activities,"  which  requires  that  an  entity
     recognize all  derivatives as either assets or liabilities in the statement
     of financial  position and measure those instruments at fair value. In June
     1999,  the FASB issued SFAS No. 137 which  deferred the  effective  date of
     SFAS No. 133. The Company will be required to adopt SFAS No. 133 during the
     fiscal  year  ended May 31,  2001.  The  Company  does not  anticipate  any
     material impact resulting from the adoption of SFAS No. 133.

4.   INVENTORIES:

     Inventories  are valued at the lower of cost or market.  Cost is determined
     on the first-in,  first-out  method.  Inventories as of August 31, 1999 and
     May 31, 1999 consisted of the following (in thousands):

                                          AUGUST 31, 1999     MAY 31, 1999
                                          ---------------     ------------
       Raw materials                         $     508          $     471
       Work-in-process                           1,770              1,566
       Finished goods                            2,947              2,477
                                             ---------          ---------

                                             $   5,225          $   4,514
                                             =========          =========

5.   BORROWING ARRANGEMENTS:

     In October  1998,  RG amended and  restated its  existing  credit  facility
     consisting  of a term loan and a revolving  line-of-credit.  The  amendment
     resulted  in the  funding  of a new term loan of  $840,000  which is due in
     monthly principal installments of $28,000 through and until October 1, 1999
     and $10,500 monthly  thereafter,  until its maturity in September 2001. The
     amount available for borrowings under the revolving line-of-credit is based
     upon the levels of eligible  RG accounts  receivable  and  inventories,  as
     defined,  subject to maximum  borrowing of $1.5  million.  As of August 31,
     1999, RG had $11,000  outstanding  under its revolving  line-of-credit  and
     $130,000 available for additional borrowings. The line-of-credit expires in
     September 2001.

     In October  1998,  FMP entered into a new credit  facility with RG's lender
     consisting of a term loan and a revolving  line-of-credit  and paid off all
     existing loans to FMP's previous  lender.  In connection with the repayment
     of the amounts outstanding under the old FMP credit facility,  FMP incurred
     a $75,000 prepayment penalty which was reflected as a component of interest
     expense in the second quarter of fiscal 1999. The term loan of $4.3 million
     is due in  monthly  principal  installments  of $99,000  through  and until
     October 1, 1999 and $65,000 monthly  thereafter,  until the maturity of the
     loan in September  2001.  The amount  available  for  borrowings  under the
     revolving  line-of-credit is based upon the levels of eligible FMP accounts
     receivable and  inventories,  as defined,  subject to maximum  borrowing of
     $4.0 million.  As of August 31, 1999, FMP had $2,056,000  outstanding under
     its  revolving  line-of-credit  and  $1,007,000  available  for  additional
     borrowings. The line-of-credit expires in September 2001.

                                      -6-
<PAGE>
     Effective  January 1, 1999,  borrowings  under the term loans and revolving
     lines-of-credit of both credit facilities bear interest at a rate per annum
     equal to the prime rate  (8.25% at August  31,  1999) plus 1.75% and 1.25%,
     respectively, and are secured by substantially all of the Company's assets.

     The FMP and RG credit  facilities  contain  financial  and other  covenants
     which, among other things,  limit annual capital expenditures and dividends
     and require the  maintenance of minimum  monthly and quarterly  earnings or
     maximum monthly and quarterly  losses,  and minimum  quarterly debt service
     coverage  ratios,  as defined.  The Company was in violation of the minimum
     quarterly  debt service  coverage ratio covenant as of August 31, 1999. The
     Company has received a conditional  waiver of this covenant  violation from
     its lender.  The Company and its lender are currently drafting an amendment
     to the RG and FMP credit  facilities.  If this  amendment  is not  executed
     before November 15, 1999, waiver of the covenant  violation will lapse. The
     Company  believes that the amendment will be executed prior to November 15,
     1999. The Company was in compliance with all other financial loan covenants
     at August 31, 1999.

6.   INFORMATION ON SEGMENTS:

     The Company has two reportable segments in continuing operations: golf club
     shafts and golf club grips. The accounting policies of the segments are the
     same as those described in the summary of significant  accounting  policies
     in Form 10-KSB.  The Company  evaluates the  performance  of these segments
     based on  segment  operating  income or loss and cash  flows.  The  Company
     allocates certain administrative  expenses to segments. The amounts in this
     illustration are the amounts in reports used by the chief operating officer
     as of August 31, 1999 (in thousands):

                                              THREE MONTHS ENDED AUGUST 31, 1999
                                              ----------------------------------
                                                  GOLF        GOLF
                                                 SHAFTS       GRIPS       TOTAL
                                                 ------       -----       -----

     Net sales                                  $ 5,286      $1,230     $ 6,516
     Operating income (loss)                        715         (29)        686
     Depreciation and amortization                   87         217         304
     Assets                                      10,922       9,409      20,331

     Total assets for reportable segments                               $20,331
     Elimination of investment in subsidiaries                           (6,193)
     Goodwill not allocated to segments                                   8,735
                                                                        -------

     Consolidated total assets                                          $22,873
                                                                        =======

                                              THREE MONTHS ENDED AUGUST 31, 1998
                                              ----------------------------------
                                                  GOLF        GOLF
                                                 SHAFTS       GRIPS       TOTAL
                                                 ------       -----       -----

     Net sales                                  $ 5,001      $ 1,037    $ 6,038
     Operating income                               226           92        318
     Depreciation and amortization                   68          163        231
     Assets                                       8,284       11,708     19,992

     Total assets for reportable segments                               $19,992
     Assets of discontinued operation                                     1,805
     Elimination of investment in subsidiaries                           (7,466)
     Goodwill not allocated to segments                                   9,898
                                                                        -------

     Consolidated total assets                                          $24,229
                                                                        =======
                                      -7-
<PAGE>
7.   DISCONTINUED OPERATIONS:

     In March 1999,  the operating  assets of Roxxi were disposed of through two
     separate  transactions.  Roxxi sold its trade name,  customer list,  design
     database and related computer software and hardware for a royalty of 16% of
     the buyer's net sales of  Roxxi-licensed  products for the two-year  period
     beginning  May  1,  1999.  Roxxi  also  sold  its  headwear   manufacturing
     equipment,  headwear  inventory  and raw  materials to another  company for
     $300,000  and a royalty of 2% of the  buyer's net sales until the buyer has
     paid an  additional  $200,000.  Subsequently,  Roxxi's  name was changed to
     Royal Grip Headwear  Company.  The Company is  accounting  for royalties as
     income is earned during the two year period  beginning May 1, 1999. For the
     three months ended August 31, 1999,  royalties of $38,000 were recorded and
     are reflected as other income in the  accompanying  condensed  consolidated
     statement of operations.

     Selected  financial data for the discontinued  operations is as follows for
     the three months ended August 31, 1998 (in thousands):

                                               1998
                                             -------

              Net sales                      $ 2,899
              Loss from operations               210
              Depreciation                        73

8.   TERMINATION OF MANUFACTURING SUPPLY CONTRACT:

     In May 1999, RG and Acushnet Rubber Company ("Acushnet")  executed a mutual
     release agreement  terminating their manufacturing and supply agreement and
     capital lease agreement (the "Termination  Agreement").  As a result in May
     1999, RG received $1.5 million in cash and $1.0 million in purchase credits
     from  Acushnet to be applied  against  current and future  amounts  owed to
     Acushnet for the  production of grips.  As of August 31, 1999,  $500,000 of
     the  purchase  credits  had been  utilized  and the  remaining  $500,000 is
     included in other current assets in the accompanying condensed consolidated
     balance sheet.

     In  connection  with  the  Termination  Agreement,   RG  will  receive  the
     manufacturing  equipment  which  was  leased  to  Acushnet  and  Acushnet's
     obligation  to make  additional  payments to RG under the capital lease was
     terminated.  The outstanding  balance of RG's capital lease receivable from
     Acushnet was approximately  $2.6 million at the contract  termination date.
     Pursuant to the  Termination  Agreement,  Acushnet is obligated to continue
     producing grips through January 2000 and to pay up to $100,000 for shipping
     and installing the manufacturing  equipment at a new location.  The Company
     estimates that the  manufacturing  equipment which will be returned to them
     has a net realizable value of approximately $1.0 million.

     RG currently  purchases  the  majority of its supply of non-cord,  injected
     grips from Acushnet and has no immediate  replacement  supply  source.  The
     Company  believes  that it can  obtain a  sufficient  supply of grips  from
     Acushnet and other existing  vendors to satisfy  customer demand during the
     fiscal year ended May 31, 2000.  Included in finished goods  inventories at
     August 31, 1999 are grips at a cost of  approximately  $662,000  located at
     Acushnet.  The  Company is  currently  in  discussions  with  certain  grip
     manufacturers  which the Company  believes  can maintain  RG's  standard of
     product  quality and will facilitate a smooth  transition.  There can be no
     assurances that the Company will be able to secure a source for grips on as
     favorable  terms  or with  the  same or  better  quality  as  Acushnet.  In
     addition,  there can be no  assurances  that a transition to a new supplier
     will not result in production  delays,  the loss of sales and key customers
     which would  materially  affect  RG's  financial  condition  and results of
     operations.

9.   TERMINATED MERGER AGREEMENT:

     In February 1999, the Company and Coyote Sports,  Inc.  ("Coyote")  entered
     into a merger  agreement  pursuant to which RP would become a  wholly-owned
     subsidiary of Coyote (the "RP-Coyote Merger").  In June 1999, the RP-Coyote
     Merger  agreement  was  terminated  at the  request of the Company due to a
     material  change in the  business of Coyote  resulting  in an  inability to
     obtain suitable long-term financing. The Company incurred professional fees
     of $975,000  related to the  RP-Coyote  Merger during the fiscal year ended
     May 31, 1999.

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

FORWARD LOOKING STATEMENTS --

The Private  Securities  Litigation  Reform Act of 1995 provides a "safe harbor"
for forward-looking statements. The Company believes it has made forward-looking
statements  within the meaning of the  Litigation  Reform Act in this Form 10-Q,
Forms 10-QSB, Forms 10-KSB, Forms 8-K, and other written or oral statements made
by or on behalf of RP which  reflect RP's  current  views with respect to future
events and financial performance.  These forward-looking  statements are subject
to certain  uncertainties  and other factors that could cause actual  results to
differ  materially from such statements.  These  uncertainties and other factors
include,  but are not  limited  to,  uncertainties  relating  to  international,
national,  and local economic conditions,  customer plans and commitments,  RP's
cost of raw materials,  the  competitive  environment in which RP operates,  and
changes in the financial  markets relating to RP's capital structure and cost of
capital.  Statements  in this Form 10-Q,  including  the Notes to the  Condensed
Consolidated  Financial  Statements and Management's  Discussion and Analysis of
Financial  Condition and Results of Operations,  describe  factors among others,
that could  contribute  to or cause such  differences.  Additional  factors that
could cause actual  results to differ  materially  from those  expressed in such
forward  looking  statements  are detailed in RP's Form 10-KSB.  Please refer to
"Risk Factors" therein. The words "believe," "expect," "anticipate,"  "project,"
and similar expressions identify forward looking statements, which speak only as
of the date the statement was made.

OVERVIEW --

Royal  Precision,  Inc. ("RP" or the "Company") is a holding  company with three
wholly-owned  subsidiaries  which  are FM  Precision  Golf  Manufacturing  Corp.
("FMP"),  FM Precision  Golf Sales Corp.  ("FMP  Sales"),  and Royal Grip,  Inc.
("RG") which has a  wholly-owned  subsidiary,  Royal Grip Headwear  Company.  RP
acquired  RG on August 29,  1997 by means of a merger  whereby  FMPSUB,  Inc. (a
wholly-owned  subsidiary of RP created for such purpose) merged with and into RG
(the  "FMP-RG  Merger").   RG  was  the  surviving   corporation  and  became  a
wholly-owned  subsidiary of RP. As discussed in Note 7, the Company  disposed of
the operating  assets of Royal Grip Headwear  Company  (formerly known as Roxxi,
Inc.  "Roxxi") in March  1999.  Results of  operations  for Roxxi in all periods
through May 31, 1999 are reflected as discontinued operations.

FMP is a  manufacturer  and  distributor  of golf club  shafts  that are sold to
original equipment  manufacturers ("OEMs") and to distributors and retailers for
use in the replacement market. The majority of FMP's sales are to OEMs. FMP also
sells golf club shafts in foreign markets including Japan, Australia, the United
Kingdom,  and Canada.  RG designs and distributes golf club grips. RG's products
are sold primarily throughout the United States,  Japan, and the United Kingdom.
The  majority of RG's grip sales are to its  Japanese  distributor.  In December
1996, RG outsourced the  manufacturing  of its non-cord grips to Acushnet Rubber
Company  ("Acushnet").  In May 1999, RG and Acushnet  executed a mutual  release
agreement  terminating the  manufacturing  and supply  agreement and the capital
lease agreement. See Note 8 and Reliance on Third Party Suppliers under Business
Environment and Future Results below.

The Company's  business is seasonal with stronger demand for its products during
the quarters ending in February and May.

THREE MONTHS ENDED AUGUST 31, 1999 COMPARED TO THE THREE MONTHS ENDED
AUGUST 31, 1998 --

NET SALES.  Net sales from  continuing  operations  for the three  months  ended
August 31, 1999 were $6.5  million,  an increase of $0.5  million or 8% from net
sales from continuing operations of $6.0 million during the corresponding period
in 1998.  Net sales of golf club shafts  increased by $0.3 million or 6% and net
sales of golf club grips  increased by $0.2 million or 19%. The increased  sales
of  golf  club  shafts  reflects  continued  strong  demand  for  the  Company's
proprietary  "Rifle" shafts. Net sales of the Company's higher priced, pro grade
golf club shafts  including the "Rifle"  increased by $0.9 million or 24%. Sales
of the Company's lower priced,  commercial  grade golf club shafts  decreased by
$0.6 million or 51%. Sales of this product have been  negatively  impacted since
the Company  instituted a significant price increase during the first quarter of
fiscal 1999. In response to these unfavorable  results, the Company subsequently
modified its pricing structure in an effort to increase sales of this product in
future periods. The increased sales of golf club grips reflects the success of a
new buffed product  introduced to the Japanese market in November 1998. Sales of
this  product  for the three  months  ended  August 31,  1999 were $0.4  million
compared to $0 during the corresponding period of 1998.

                                      -9-
<PAGE>
COST OF SALES.  Cost of goods  sold  from  continuing  operations  for the three
months ended August 31, 1999 was $4.1 million, an increase of $0.3 million or 6%
from cost of goods sold from  continuing  operations of $3.8 million  during the
corresponding  period in 1998.  Golf club shafts cost of goods sold decreased by
$0.1 million or 2% despite an increase in net sales due to a favorable change in
the mix of product  sales from lower margin,  commercial  grade shafts to higher
margin  "Rifle" and other pro grade  shafts.  Golf club grips cost of goods sold
increased by $0.3 million as a result of higher total net sales.

GROSS PROFIT. Gross profit from continuing operations for the three months ended
August 31, 1999 was $2.4 million,  an increase of $0.2 million or 11% from gross
profit from continuing  operations of $2.2 million for the corresponding  period
in 1998.  Gross profit from sales of golf club shafts  increased by $0.3 million
or 20% to $2.1 million due to higher  total net sales and a favorable  change in
the mix of product  sales from lower margin,  commercial  grade shafts to higher
margin "Rifle" and other pro grade shafts.  As a percentage of sales,  the gross
profit on sales of golf club shafts increased from 34.5% to 39.1%.  Gross profit
from sales of golf club grips  decreased  by $0.1 million or 22% to $0.4 million
despite an increase in net sales. As a percentage of sales,  the gross profit on
sales of golf club grips decreased from 46.9% to 30.9%. The Company's new buffed
grip product is being manufactured at a higher cost and is being sold at a lower
profit margin than other RG products.

SELLING,   GENERAL   AND   ADMINISTRATIVE   EXPENSES.   Selling,   general   and
administrative  expenses  for the three  months  ended August 31, 1999 were $1.8
million, a decrease of 7% from selling,  general and administrative  expenses of
$1.9 million during the corresponding period in 1998. This net reduction of $0.1
million  reflects the positive  effect of the  Company's  cost cutting  measures
implemented  following  the FMP-RG  Merger which have  resulted in reductions of
corporate overhead expenses.

INTEREST  EXPENSE.  Average  outstanding  borrowings were comparable  during the
three months ended August 31, 1999 and 1998 and, therefore,  interest expense is
consistent at $151,000 and $161,000, respectively.

OTHER INCOME. Other income of $55,000 for the three months ended August 31, 1999
is  principally  comprised  of  royalties  earned  on sales  of  Roxxi  headwear
products.  Other income of $61,000 for the three months ended August 31, 1998 is
principally   comprised  of  interest  income  on  the  Acushnet  capital  lease
receivable.

PROVISION FOR INCOME TAXES.  Provisions of $296,000 and $5,000 were recorded for
taxes on income from continuing  operations during the three months ended August
31,  1999 and 1998,  respectively.  Taxes are  provided  based on the  estimated
effective  tax rate for the year which  considers  the  effect of  nondeductible
goodwill amortization.

DISCONTINUED  OPERATIONS.  As discussed  in Note 7, the Company  disposed of the
operating assets of Roxxi in March 1999. Losses from the operations of Roxxi for
the three months ended August 31, 1998 were $0.2 million.

LIQUIDITY AND CAPITAL  RESOURCES.  At August 31, 1999, RP had working capital of
$4.6 million and a current  ratio of 2.1 to 1 as compared to working  capital of
$5.8 million and a current ratio of 2.2 to 1 at May 31, 1999.

In October 1998, RG amended and restated its existing credit facility consisting
of a term loan and a revolving  line-of-credit.  The  amendment  resulted in the
funding  of a new  term  loan of  $840,000  which  is due in  monthly  principal
installments  of $28,000  through and until October 1, 1999 and $10,500  monthly
thereafter,  until its  maturity in September  2001.  The amount  available  for
borrowings  under  the  revolving  line-of-credit  is based  upon the  levels of
eligible RG accounts receivable and inventories,  as defined, subject to maximum
borrowing of $1.5  million.  As of August 31, 1999,  RG had $11,000  outstanding
under  its  revolving  line-of-credit  and  $130,000  available  for  additional
borrowings. The line-of-credit expires in September 2001.

In October  1998,  FMP  entered  into a new  credit  facility  with RG's  lender
consisting  of a term  loan  and a  revolving  line-of-credit  and  paid off all
existing loans to FMP's previous lender. In connection with the repayment of the
amounts  outstanding  under the old FMP credit facility,  FMP incurred a $75,000
prepayment penalty which was reflected as a component of interest expense in the
second  quarter of fiscal 1999.  The term loan of $4.3 million is due in monthly
principal  installments of $99,000 through and until October 1, 1999 and $65,000
monthly thereafter, until the maturity of the loan in September 2001. The amount
available for borrowings  under the revolving  line-of-credit  is based upon the
levels of eligible FMP accounts receivable and inventories,  as defined, subject
to maximum borrowing of $4.0 million.  As of August 31, 1999, FMP had $2,056,000
outstanding  under its revolving  line-of-credit  and  $1,007,000  available for
additional borrowings. The line-of-credit expires in September 2001.

                                      -10-
<PAGE>
Effective  January  1,  1999,  borrowings  under the term  loans  and  revolving
lines-of-credit  of both  credit  facilities  bear  interest at a rate per annum
equal to the prime  rate  (8.25% at  August  31,  1999)  plus  1.75% and  1.25%,
respectively, and are secured by substantially all of the Company's assets.

The FMP and RG credit  facilities  contain  financial and other covenants which,
among other things,  limit annual capital expenditures and dividends and require
the maintenance of minimum monthly and quarterly earnings or maximum monthly and
quarterly  losses,  and minimum  quarterly  debt  service  coverage  ratios,  as
defined.  The Company was in  violation  of the minimum  quarterly  debt service
coverage  ratio  covenant as of August 31,  1999.  The  Company  has  received a
conditional  waiver of this covenant  violation from its lender. The Company and
its  lender  are  currently  drafting  an  amendment  to the RG and  FMP  credit
facilities.  If this amendment is not executed before November 15, 1999,  waiver
of the covenant  violation will lapse.  The Company  believes that the amendment
will be executed prior to November 15, 1999. The Company was in compliance  with
all other financial loan covenants at August 31, 1999.

The Company  believes  that its  existing  capital  resources  and credit  lines
available are  sufficient to fund its  operations  and capital  requirements  as
presently planned over the next twelve months.

During the three months ended  August 31, 1999,  net cash  provided by operating
activities  was $1.8  million  which  primarily  resulted  from net income  from
continuing  operations of $0.3 million,  depreciation  and  amortization of $0.3
million and  decreases in accounts  receivable  and other assets of $2.3 million
and $0.2  million,  respectively.  Cash  provided by  operating  activities  was
reduced by an increase in inventories of $0.7 million and a decrease in accounts
payable and accrued expenses of $0.6 million.

Net cash used in investing activities for the three months ended August 31, 1999
was $0.5 million for the purchase of property, plant and equipment.

The Company  estimates that capital  expenditures  for the fiscal year ended May
31, 2000 will be approximately  $2.0 million including  $750,000 to complete the
upgrade of FMP's wastewater treatment facilities.  The Company incurred $250,000
during the fiscal year ended May 31, 1999  related to the  wastewater  treatment
facility.  To finance a portion of the  estimated $1 million  total cost of this
project,  the Company has  received a funding  commitment  of $750,000  from the
Connecticut  Development Authority which can be advanced to the Company upon the
completion  of the  facility  and  approval  by the  Connecticut  Department  of
Environmental Protection.

Net cash used in  financing  activities  for the three  months  ended August 31,
1999, was $1.4 million  resulting from  repayments of long term debt and capital
lease  obligations of $0.4 million and net  repayments  under lines-of-credit of
$1.0 million.

YEAR 2000 ASSESSMENT --

The following Year 2000 discussion contains various  forward-looking  statements
that represent the Company's  beliefs or expectations  regarding  future events.
When  used  in  the  Year  2000  discussion,  the  words  "believe,"  "expects,"
"estimates"   and  other   similar   expressions   are   intended   to  identify
forward-looking   statements.   Forward-looking   statements  include,   without
limitation,  the  Company's  expectations  as to  when  it and  its  significant
distributors,  customers and  suppliers  will  complete the  implementation  and
compliance  phases of the Year 2000 Plan,  as well as its Year 2000  contingency
plans; and the Company's belief that its internal systems and equipment are Year
2000 compliant.  All  forward-looking  statements  involve a number of risks and
uncertainties  that could cause the actual results to differ materially from the
projected results. Factors that may cause these differences include, but are not
limited  to, the  availability  of  qualified  personnel  and other  information
technology  resources;  the ability to identify  and rectify all date  sensitive
lines of code or to replace  embedded  chips in affected  systems or  equipment;
unanticipated delays or expenses related to correction of the problems;  and the
actions of independent  third-parties  with respect to Year 2000  problems.  The
statements in the following  section  include "Year 2000  Readiness  Disclosure"
within the meaning of the Year 2000 Information and Readiness  Disclosure Act of
1998.

The Year 2000  problem  refers to the  inability  of  software  to process  date
information  later than December 31, 1999. Date codes in many software  programs
are  abbreviated  to  allow  only  two  digits  for  the  year.   Software  with
date-sensitive  functions  that is not Year  2000  compliant  may not be able to
distinguish  whether "00" means 1900 or 2000.  When that happens,  some software
will not work at all and other  software will suffer  critical  calculation  and
other  processing  errors.  Hardware and other  products with embedded chips may
also experience problems.

                                      -11-
<PAGE>
The Company has completed a comprehensive evaluation of its internal systems and
equipment  that  addresses  both  information  technology  systems  ("IT,"  i.e.
business systems and the software  development  environment) and non-IT systems,
(i.e.  elevators,  building  security  and  HVAC  systems)  including  hardware,
software and firmware.  The Company believes that its critical  internal systems
including versions of Macola, ADP, Oracle, Microsoft Exchange,  Microsoft Office
97,  Microsoft  Windows  NT,  Microsoft  Windows  9x, and  Microsoft  SQL Server
products are Year 2000 compliant.  In addition,  the Company tracks the versions
and updates available for these products to ensure Year 2000 compliance.  During
the previous two-year period, the Company has expended approximately $100,000 to
purchase and install new computer hardware and software resulting in all Company
hardware  and  software  being Year 2000  compliant.  Expenses  associated  with
evaluation  of the Company's  internal  systems for Year 2000 problems have been
approximately  $20,000.  The Company believes that any future internal Year 2000
costs will be immaterial.

Due to the  Company's  extensive  internal  Year 2000  analysis  and  subsequent
completion of the Year 2000 project, the Company has determined that an internal
contingency  plan is  unnecessary.  The  Company  has  completed a review of its
significant  suppliers  to  determine  that the  suppliers'  operations  and the
products and  services  they provide are Year 2000  compliant.  All  significant
suppliers and utilities  have indicated that their products and company are Year
2000 compliant.  The primary  supplier of the Company's golf club grips recently
completed a conversion of its  accounting  system and has  indicated  that their
operations, products and services they provide are now Year 2000 compliant.

The Company has no practical means to verify the  information  provided by these
independent third parties and is still pursuing those secondary distributors and
vendors who may not yet have  responded.  Based upon this  assessment  and where
practicable,  the Company will attempt to mitigate its risks with respect to any
suppliers  that may not meet the  requirements,  including  seeking  alternative
suppliers.  However,  there  can be no  assurance  that  the  Company  will  not
experience  disruptions in its ability to conduct  business because of Year 2000
problems  experienced by the Company's  distributors  or vendors,  such problems
remain a possibility  and could have an adverse impact on the Company's  results
of operations and financial  condition.  To the extent that its key distributors
or vendors experience  problems relative to achieving Year 2000 compliance,  the
Company could suffer unanticipated revenue losses.

Some  independent  sales   representatives   that  the  Company  uses  may  have
applications that are not Year 2000 compliant. The Company does not believe this
is a material  concern  since  product  orders are either  manually  written and
submitted via fax, or are submitted on a Company  supplied  automated order form
that is Year 2000 compliant.

Some  commentators  have predicted  significant  litigation  regarding Year 2000
compliance issues. Because of the unprecedented nature of such litigation, it is
uncertain whether,  or to what extent, the Company may be affected.  However, at
this time the Company  believes that it is not likely to have a material adverse
effect on the Company or its operations.

BUSINESS ENVIRONMENT AND FUTURE RESULTS --

RELIANCE ON THIRD PARTY  SUPPLIERS.  In May 1999, RG and Acushnet Rubber Company
("Acushnet") executed a mutual release agreement terminating their manufacturing
and supply agreement and capital lease agreement (the "Termination  Agreement").
As a result in May 1999,  RG received  $1.5  million in cash and $1.0 million in
purchase  credits from Acushnet to be applied against current and future amounts
owed to Acushnet for the production of grips. As of August 31, 1999, $500,000 of
the purchase credits had been utilized and the remaining $500,000 is included in
other current assets in the accompanying condensed consolidated balance sheet.

In connection with the Termination Agreement,  RG will receive the manufacturing
equipment  which was  leased  to  Acushnet  and  Acushnet's  obligation  to make
additional  payments  to  RG  under  the  capital  lease  was  terminated.   The
outstanding   balance  of  RG's  capital  lease  receivable  from  Acushnet  was
approximately  $2.6 million at the contract  termination  date.  Pursuant to the
Termination Agreement, Acushnet is obligated to continue producing grips through
January  2000  and  to  pay up to  $100,000  for  shipping  and  installing  the
manufacturing  equipment  at a new  location.  The  Company  estimates  that the
manufacturing  equipment  which will be  returned  to them has a net  realizable
value of approximately $1.0 million.

                                      -12-
<PAGE>
RG currently  purchases the majority of its supply of non-cord,  injected  grips
from  Acushnet  and has no  immediate  replacement  supply  source.  The Company
believes that it can obtain a sufficient supply of grips from Acushnet and other
existing vendors to satisfy customer demand during the fiscal year ended May 31,
2000.  Included in finished goods  inventories at August 31, 1999 are grips at a
cost of approximately  $662,000 located at Acushnet. The Company is currently in
discussions  with  certain  grip  manufacturers  which the Company  believes can
maintain  RG's  standard  of  product  quality  and  will  facilitate  a  smooth
transition. There can be no assurances that the Company will be able to secure a
source  for grips on as  favorable  terms or with the same or better  quality as
Acushnet.  In addition,  there can be no  assurances  that a transition to a new
supplier  will not  result  in  production  delays,  the  loss of sales  and key
customers which would materially affect RG's financial  condition and results of
operations.

DISCONTINUED  OPERATIONS.  In March  1999,  the  operating  assets of Roxxi were
disposed  of through  two  separate  transactions.  Roxxi  sold its trade  name,
customer list,  design database and related computer software and hardware for a
royalty  of 16% of the  buyer's  net sales of  Roxxi-licensed  products  for the
two-year   period   beginning  May  1,  1999.   Roxxi  also  sold  its  headwear
manufacturing equipment, headwear inventory and raw materials to another company
for  $300,000  and a royalty of 2% of the  buyer's net sales until the buyer has
paid an  additional  $200,000.  Subsequently,  Roxxi's name was changed to Royal
Grip  Headwear  Company.  The Company is  accounting  for royalties as income is
earned during the two year period  beginning  May 1, 1999.  For the three months
ended August 31, 1999,  royalties of $38,000 were  recorded and are reflected as
other income in the accompanying condensed consolidated statement of operations.

If the buyers generate net headwear sales of $3.0 million per year, as Roxxi did
during the twelve months ended  February 28, 1999, the Company would be entitled
to receive  royalties of  approximately  $0.5 million  during each of the fiscal
years ended May 31, 2000 and 2001 under these contracts.  However,  there can be
no assurance  that the two buyers will be able to achieve these sales amounts or
any sales  amounts in the  future.  Royalties  to be received by the Company are
contingent  on the business  operations of the two buyers over which the Company
has no influence or control.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company has no derivative financial instruments subject to market risk other
than its fixed and variable rate debt.  These borrowing  arrangements  are fully
described in Note 5 to the Condensed Consolidated Financial Statements.

                                      -13-
<PAGE>
                                     PART II
                                OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

     None.

ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS.

     None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

     None.

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

     None.

ITEM 5. OTHER INFORMATION.

     None.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.

     (a) Exhibits.

     (3) Certificate of Incorporation and Bylaws

          Exhibit 3.1.  Amended and Restated  Certificate  of  Incorporation  of
          Registrant  (incorporated  by reference  to Annex IV to the  Company's
          Form S-4; No. 333-28841 (the "Form S-4")).

          Exhibit  3.2.  Bylaws  of  Royal  Precision,   Inc.  (incorporated  by
          reference to Exhibit 3.2 to the Form S-4).

     (4) Instruments Defining the Rights of Security Holders

          Exhibit 4.1.  See  Articles  FOUR,  FIVE and SEVEN of the  Amended and
          Restated  Certificate of Incorporation of Registrant  (incorporated by
          reference to Exhibit 3.1 to the Form S-4).

          Exhibit  4.2.  See Article I,  Sections  2.1 and 2.2 of Article II and
          Section  7.3 of  Article  VII of the Bylaws of Royal  Precision,  Inc.
          (incorporated by reference to Exhibit 3.2 to the Form S-4).

     (10) Material Contracts

          Exhibit 10.1.  Personal  Services  Agreement entered into as of August
          29, 1999 between Danny Edwards and Royal Precision, Inc.

     Exhibit 27.

     Financial Data Schedule (submitted electronically for SEC information only)

     (b) Reports on Form 8-K.

     No  Reports  on Form 8-K were filed by the  Registrant  during the  quarter
     ended August 31, 1999.

                                      -14-
<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.

                                        ROYAL PRECISION, INC.

Date October 14, 1999                   By /s/ Thomas Schneider
                                           -------------------------------------
                                           Thomas Schneider, President
                                           (duly authorized officer)

                                        By /s/ Kevin Neill
                                           -------------------------------------
                                           Kevin Neill, Vice President - Finance
                                           (chief accounting officer)

                                      -15-
<PAGE>
                                  EXHIBIT INDEX

                                                                      PAGE IN
                                                                    SEQUENTIALLY
                                                                      NUMBERED
EXHIBIT                                                                 COPY
-------                                                             ------------

  3.1     Amended and Restated Certificate of Incorporation of
          Registrant (incorporated by reference to Annex IV to the
          Company's Form S-4, No. 333-28841) (the "Form S-4")             *

  3.2     Bylaws of Royal Precision, Inc. (incorporated by
          reference to Exhibit 3.2 to the Form S-4)                       *

  4.1     See Articles FOUR, FIVE and SEVEN of the Amended and
          Restated Certificate of Incorporation of the Registrant
          (incorporated  by reference to Exhibit 3.1 to the
          Form S-4.                                                       *

  4.2     See Article I, Sections 2.1 and 2.2 of Article II and
          Section  7.3 of Article VII of the Bylaws of Royal
          Precision, Inc. (incorporated by reference to
          Exhibit 3.2 to the Form S-4)                                    *

 10.1     Personal Services Agreement entered into as of August 29,
          1999 between Danny Edwards and Royal Precision, Inc.            17

 27.      Financial Data Schedule (submitted electronically for SEC
          information only


* Incorporated by reference