<PAGE>
 
 
                                   ADVO, Inc.
 
                                   Form 10-K
 
                               September 27, 1997
 
 
<PAGE>
 
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                                   FORM 10-K
 
                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549
 
(Mark One)
 
 [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
               SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
 
For the fiscal year ended September 27, 1997
                          ------------------

                                      OR
 
 [_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
              THE SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
 
For the transition period from        to 
                               ------    ------  
Commission file number 1-11720
 
                                  ADVO, INC.
            ------------------------------------------------------    
            (Exact name of registrant as specified in its charter)
 
              Delaware                                 06-0885252
--------------------------------------  ----------------------------------------
   (State or other jurisdiction of        (I.R.S. Employer Identification No.)
   incorporation or organization)
 
One Univac Lane, P.O. Box 755, Windsor, CT              06095-0755
-------------------------------------------   --------------------------------  
     (Address of principal executive                    (Zip Code)
                offices)             
                                   
 
      Registrant's telephone number, including area code: (860) 285-6100
 
Securities registered pursuant to Section 12(b) of the Act:
 
               Common Stock and Rights, par value $.01 per share
               -------------------------------------------------
                             (Title of Class)
 
Securities registered pursuant to Section 12(g) of the Act:
 
                                     NONE
                                     ----

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 by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to
this Form 10-K. [X]
 
The aggregate market value of voting stock held by non-affiliates of the
registrant at November 28, 1997 was $446,458,574. On that date, there were
22,487,846 outstanding shares of the registrant's common stock.
 
Documents Incorporated by Reference:
 
Portions of the 1997 Annual Report to Stockholders are incorporated by
reference into Parts II and IV of this Report.
 
Portions of the Proxy Statement for the 1998 Annual Meeting of Stockholders
are incorporated by reference into Part III of this Report.
 
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<PAGE>
 
                                   ADVO, INC.
                          INDEX TO REPORT ON FORM 10-K
                     FOR THE YEAR ENDED SEPTEMBER 27, 1997
 
                                     PART I
 
<TABLE>
<CAPTION>
ITEM                                                                        PAGE
----                                                                        ----
<S>                                                                         <C>
 1. Business..............................................................    1
 2. Properties............................................................    5
 3. Legal Proceedings.....................................................    5
 4. Submission of Matters to a Vote of Security Holders...................    5
 
                                    PART II
 
 5. Market for Registrant's Common Equity and Related Stockholder Matters.    6
 6. Selected Financial Data...............................................    6
 7. Management's Discussion and Analysis of Financial Condition and Re-
    sults of Operations...................................................    7
 8. Financial Statements and Supplementary Data...........................    7
 9. Changes in and Disagreements with Accountants on Accounting and Finan-
    cial Disclosure.......................................................    7
 
                                    PART III
 
10. Directors and Executive Officers of the Registrant....................    7
11. Executive Compensation................................................    7
12. Security Ownership of Certain Beneficial Owners and Management........    7
13. Certain Relationships and Related Transactions........................    7
 
                                    PART IV
 
14. Exhibits, Financial Statement Schedules and Reports on Form 8-K.......    8
</TABLE>
<PAGE>
 
                                    PART I
 
ITEM 1. BUSINESS
 
GENERAL
 
  ADVO, Inc. ("ADVO" or the "Company") is a direct marketing firm primarily
engaged in soliciting and processing printed advertising from retailers,
manufacturers and service companies for targeted distribution by both shared
and solo mail to consumer households in the United States on a national,
regional and local basis. Founded in 1929 as a hand delivery company, the
Company entered the direct mail industry as a solo mailer in 1946 and began
its shared mail program in 1980. The Company currently is the largest
commercial user of third-class mail in the United States.
 
  ADVO competes primarily with newspapers, direct mail companies, broadcast
media, periodicals and other local distribution entities for retail
advertising expenditures. The Company believes that direct mail, which enables
advertisers to target advertisements to specific customers or geographic
areas, is the most efficient vehicle for delivering printed advertising on a
saturation or full market coverage basis, as well as an effective means of
targeted coverage.
 
  ADVO's principal executive offices are located at One Univac Lane, Windsor,
Connecticut 06095.
 
  In fiscal year 1995, the Company announced its plan to sell its in-store
marketing segment which provided marketing services to a wide range of
manufacturers and marketers using proprietary operating systems. The sale of
substantially all of the net assets of this segment was completed on March 1,
1996. For fiscal year 1995 and 1996 (and by restatement of prior periods), the
Company is accounting for its in-store marketing segment as a discontinued
operation in this Annual Report on Form 10-K. The discussion of the Company's
business under Items 1 and 2 hereof includes only the Company's continuing
operations.
 
PRODUCTS AND SERVICES
 
  ADVO's direct marketing products and services include shared mail and solo
mail. ADVO also provides certain transportation and ancillary services in
conjunction with its direct marketing programs.
 
SHARED MAIL
 
  In the Company's shared mail programs (Marriage Mail(R) and Mailbox
Values(R)), the advertisements of several advertisers are combined in a single
mail package.
 
  Shared mail packages are assembled by the Company for distribution by ZIP
Code and, in most instances, each household within the ZIP Code will receive a
mail package. Individual customers can choose a portion of the designated
mailing area for their distributions, ranging from part of a ZIP Code to all
ZIP Codes covered by the program. This flexibility enables major customers,
such as retail store chains, to select areas serviced by their retail stores
and, at the same time, distribute different versions of their advertisements
to accommodate the needs of their individual stores. It also allows a smaller
retailer to target only those ZIP Codes or portions of ZIP Codes needed to
accommodate its customer base, thereby reducing overall advertising costs.
 
  The Company's shared mail programs offer the features of penetration and
target marketing at a significant cost reduction when compared to mailing on
an individual or solo mail basis. This cost advantage is available because the
Company pays the total postage expense, and advertisers are generally charged
a selling price based upon, among other factors, the incremental weight of
their promotional pieces.
 
                                       1
<PAGE>
 
  As a part of its shared mail programs, the Company provides the addresses of
the households receiving the mail packages; and sorts, processes and
transports the advertising material for ultimate delivery through the United
States Postal Service ("USPS"). Generally, larger businesses, such as food
chains and mass merchandisers, will provide the Company with preprinted
advertising materials in predetermined quantities. In the case of
manufacturers and small retail customers, the Company may perform graphics
services and act as a broker for the required printing. The Company also
offers shared mail customers numerous standard turnkey advertising products in
a variety of sizes and colors.
 
  The Company believes its shared mail programs are the largest programs of
their kind.
 
  Marriage Mail(R) is a weekly mail program with coverage, on average, of 61
million households in approximately 120 markets. This program is used by local
and national retailers. The ZIP Code configuration selected for each market is
normally determined by population density and by proximity to retail outlets.
Retailers with multiple locations and weekly frequency have a great influence
on the ZIP Codes chosen by the Company for its weekly mailings. The Company
derives most of its revenues from the Marriage Mail(R) program.
 
  At the beginning of fiscal 1997, the Company announced that it had formed a
new network, known as A.N.N.E. (ADVO National Network Extension), of regional
shared mail companies to provide its clients with extended coverage outside
the markets already served by the Company. The Company handles the clients'
orders directly and manages distribution of their advertising through
A.N.N.E.'s network partners. Conversely, the A.N.N.E. network enables
participating partners (shared mail companies) to offer their clients extended
marketplace reach using the Company's services.
 
SOLO MAIL
 
  Solo mail services include addressing and processing brochures and circulars
for an individual customer for distribution through the USPS. Each customer
bears the full cost of postage and handling for each mailing. Customers
choosing this form of direct mail are generally those who wish to maintain an
exclusive image and complete control over the timing and the target of their
mailings.
 
  The Company processes solo mail using its own mailing list or lists supplied
by the customer. The Company charges a processing fee based on the solo mail
services rendered.
 
OTHER PRODUCTS AND SERVICES
 
  The Company rents portions of its mailing list to organizations interested
in distributing their own solo mailings. The Company may or may not perform
the associated distribution services for the customer.
 
  Trans-ADVO, Inc., a wholly-owned subsidiary of the Company, is a Class 1 ICC
Contract Carrier presently engaged in the transportation of time-sensitive
advertising material and general freight. Trans-ADVO, Inc., utilizes
contracted carriers to provide direct pickup and delivery services throughout
the 48 contiguous states.
 
  ADVO Creative Services, Inc., based in Texas, is a wholly-owned subsidiary
of the Company which specializes in the coordination and production of custom
promotional magazines and circulars which, in most cases, are then distributed
by the Company.
 
MAILING LIST
 
  ADVO's management believes its computerized mailing list is the largest
residential/household mailing list in the country. It contains over 114
million delivery points (constituting nearly all of the
 
                                       2
<PAGE>
 
households in the continental United States) and was used by the U.S. Census
Bureau as a base for developing the mailing list for its 1980 and 1990 census
questionnaire mailings. The Company's management believes that the list is
particularly valuable and that replication in its entirety by competitors
would be extremely difficult and costly. The list enables the Company to
target mailings to best serve its customers.
 
  ADVO's list is updated on a regular basis with information supplied by the
USPS. Bimonthly, ADVO submits each address on its mailing list to the USPS.
The USPS then provides to ADVO any changes to the addresses within the ZIP
Code. Such changes would cover whether the address is still occupied, whether
the address still exists at all (i.e., demolished buildings) and any new
addresses included in the ZIP Code (i.e., new construction). The USPS also
indicates to ADVO changes in the walk sequence order of addresses so that ADVO
can qualify for the lowest possible postage rates. The USPS provides these
updates for a fee, provided that the user's list is at least 90% complete on a
ZIP Code basis. ADVO believes its list is nearly 100% accurate.
 
CUSTOMER BASE
 
  Typically, the Company's customers are those businesses whose products and
services are used by the general population. These businesses (supermarkets,
fast food, drug stores, discount and department stores and consumer products
manufacturers) require continuous advertising to a mass audience. No one
customer accounted for more than 4% of the Company's sales in fiscal 1997,
1996 or 1995.
 
OPERATIONS
 
  Customers' advertising circulars are processed by approximately 2,500
production employees who work at 19 mail processing facilities which are
strategically located throughout the nation. State-of-the-art inserting
machines (which combine the individual advertising pieces into the mailing
packages), addressing and labeling, and quarter-folding machines are the
principal equipment used to process the Company's products and services. At
several of the Company's production facilities, new computerized mail sorters
are being utilized and developed. In all 19 of ADVO's mail processing
facilities, the USPS accepts and verifies the Company's mail to help ensure
rapid package acceptance and distribution, which benefits both the USPS and
the Company. In most instances, the mail is then shipped by the Company to the
destination office of the USPS for final delivery.
 
  During fiscal 1996, the Company entered into a ten year agreement with
Integrated Systems Solutions Corporation, now known as IBM Global Services, to
provide systems development and technical support to the Company. As a result
of this outsourcing, ADVO's computer center moved from Hartford to IBM Global
Services' computer center located in Southbury, Connecticut. The Company's
branches are on-line to this computer center which enables the day-to-day
processing functions to be performed and provides corporate headquarters with
management information. The systems include: order processing and production
control, transportation/distribution, address list maintenance, market
analysis, label printing and distribution, billing and financial and carrier
routing of addresses received from customer files and demographic analyses.
 
COMPETITION
 
  In general, the printed advertising market is highly competitive with
companies competing primarily on the basis of price, speed of delivery and
ability to target selected potential customers on a cost-effective basis.
ADVO's competitors for the delivery of retail and other printed advertising
are numerous, and include newspapers, regional and local mailers, direct
marketing firms, "shoppers" and "pennysavers".
 
                                       3
<PAGE>
 
  Newspapers represent the Company's most significant and direct competition.
Through the distribution of preprinted circulars, classified advertising and
run of press advertising ("ROP"), newspapers have been the traditional and
dominant medium for advertising by retailers for many years. Insertion rates
are highly competitive and many newspapers' financial resources are
substantial.
 
  ADVO's principal direct marketing competitors are other companies with
residential lists or similar cooperative mailing programs. These companies
have a significant presence in many of the Company's markets and represent
serious competition to the Company's Marriage Mail(R) programs in those
markets.
 
  There are local mailers in practically every market of the country. In
addition to local mailers, there are many local private delivery services such
as "shoppers" and "pennysavers" which compete by selling ROP advertisements
and classified advertisements. ADVO believes that it competes effectively in
its various markets.
 
SEASONALITY
 
  ADVO's business generally follows the trends of retail advertising spending.
The Company has historically experienced higher revenues in the second half of
the calendar year.
 
RESEARCH AND DEVELOPMENT
 
  Expenditures of the Company in research and development during the last
three years have not been material.
 
ENVIRONMENTAL MATTERS
 
  The Company believes that it is substantially in compliance with all
regulations concerning the discharge of materials into the environment, and
such regulations have not had a material effect on the capital expenditures or
operations of the Company.
 
RAW MATERIALS
 
  The Company manages approximately 45,000 tons of paper per year and another
10,000 tons through its printing network on behalf of its print vendors. ADVO
has agreements with various paper suppliers and print vendors to assure the
supply of proper paper grades at competitive prices.
 
EMPLOYEES
 
  As of September 27, 1997, the Company had a total of approximately 4,700
full and part-time employees. ADVO also uses outside temporary employees,
particularly during busy seasons.
 
  ADVO has one union contract, covering production employees in the Hartford,
Connecticut branch. The Company believes that its relations with its employees
are satisfactory.
 
FORWARD LOOKING STATEMENTS
 
  Except for the historical information stated herein, the matters discussed
in this Report on Form 10-K contain forward looking statements within the
meaning of Section 21E of the Securities Exchange Act of 1934, as amended.
Such forward looking statements are accompanied by cautionary factors which
would cause the Company's actual results to differ materially from those in
the forward looking statements. Such factors include but are not limited to
changes in customer demand; postal and paper prices; the realization of
benefits associated with the Company's reengineering initiative; possible
governmental regulation or legislation affecting aspects of the Company's
business; the risk of damage
 
                                       4
<PAGE>
 
to the Company's data centers and telecommunication lines; the efficiencies
achieved with technology upgrades; the amount of shares the Company will
purchase in the future under its buyback program; the evaluation of the impact
of year 2000 costs; and other general economic factors.
 
ITEM 2. PROPERTIES
 
  ADVO does not own any real estate except for its corporate headquarters,
which the Company purchased in fiscal year 1995. The corporate headquarters,
located in Windsor, Connecticut, consist of two buildings totaling
approximately 136,000 square feet. The Company leases 19 mail processing
facilities and approximately 65 sales offices (which excludes the sales
offices that are located in the mail processing facilities) throughout the
United States. The Company believes its facilities are suitable and adequate
for the purposes for which they are used and are adequately maintained.
 
ITEM 3. LEGAL PROCEEDINGS
 
  ADVO is party to various lawsuits and regulatory proceedings which are
incidental to its business and which the Company believes will not have a
material adverse effect on its consolidated financial condition, liquidity or
results of operations.
 
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
 
  Not applicable.
 
                     EXECUTIVE OFFICERS OF THE REGISTRANT
 
<TABLE>
<CAPTION>
           NAME            AGE               POSITION WITH COMPANY
           ----            ---               ---------------------
<S>                        <C> <C>
Robert Kamerschen.........  61 Chairman and Chief Executive Officer
Gary M. Mulloy............  52 President and Chief Operating Officer
Donald E. McCombs.........  41 Senior Vice President and Chief Financial Officer
Rick Kurz.................  57 Senior Vice President
Myron L. Lubin............  57 Senior Vice President
A. Brian Sanders..........  36 Senior Vice President
Robert S. Hirst...........  51 Vice President and Controller
</TABLE>
 
  Mr. Kamerschen has been the Chairman of the Board since January 1989. From
November 1988 to February 1989, he was President of the Company and he has
been Chief Executive Officer and a Director since November 1988. Mr.
Kamerschen is also a Director of Micrografx, Inc., Domain, Inc. and Cognizant
Corporation.
 
  Mr. Mulloy has been President and Chief Operating Officer since November 4,
1996 and was elected to the Board of Directors on December 3, 1996. From 1990
to October 1996 he was President and Chief Executive Officer of Pilkington
Barnes-Hind, Inc., a division of Pilkington Vision Care.
 
  Mr. McCombs became Senior Vice President and Chief Financial Officer on
November 7, 1997. From 1989 to October 1997, he was Vice President--Financial
Planning and Measurements. He had held that position for the last eight years.
 
  Mr. Kurz became Senior Vice President and Chief Strategic Growth Officer on
April 15, 1997. From April 1993 to March 1997, he held the position of Senior
Vice President--Chief Marketing Officer. Prior to that, he was a Managing
Partner of Marketing Corporation of America, a marketing consulting firm.
 
 
                                       5
<PAGE>
 
  Mr. Lubin became Senior Vice President--Chief Sales Officer on December 4,
1995. From January 1990 to November 1995, he held the position of Senior Vice
President-President Western Division.
 
  Mr. Sanders became Senior Vice President--Chief Marketing Officer on May 19,
1997. For the five years prior to that he held several executive positions at
Pilkington Barnes-Hind, Inc., a division of Pilkington Vision Care.
 
  Mr. Hirst became Vice President and Controller on April 16, 1990. He has
held that position for the last seven years.
 
  The Company is not aware of any family relationships between any of the
foregoing officers and any of the Company's directors. Each of the foregoing
officers hold such office until his successor shall have been duly chosen and
shall have been qualified, or until his earlier resignation or removal.
 
                                    PART II
 
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
 
  ADVO's 1997 Annual Report to Stockholders includes on page 37 under the
caption "Quarterly Financial Data (Unaudited)" the reported high and low
market prices of ADVO's common stock for the past two fiscal years, and such
information is incorporated herein by reference and made a part hereof (see
Exhibit 13).
 
  For the fiscal year ended September 27, 1997, the Company declared no cash
dividends. During fiscal 1996, the Company paid a regular first quarter
dividend of $.025 per share of ADVO common stock, payable to shareholders of
record on December 27, 1995. On January 17, 1996 the Company announced the
declaration of a special one time dividend (the "Special Dividend") of $10 per
share of ADVO common stock to shareholders of record on February 20, 1996. The
announcement was a result of the Company's initiative to explore strategic
alternatives aimed at increasing shareholder value, which began at the end of
fiscal 1995. In addition, the Board of Directors suspended the Company's
regular quarterly dividend of $.025 per share of ADVO common stock after the
declaration of the Special Dividend. The Company is currently subject to ratio
restrictions regarding future cash dividends exceeding $.025 per share as
stipulated in its renegotiated credit agreement dated September 29, 1997, with
Chase Manhattan Bank.
 
  The Company declared quarterly cash dividends of $.025 per share to holders
of ADVO common stock during the fiscal year ended September 30, 1995 for total
cash dividends of $.10 per share.
 
  The closing price as of November 28, 1997 of the Company's common stock,
under the symbol AD, on the New York Stock Exchange as reported in The Wall
Street Journal was $21 3/4 per share. The approximate number of holders of
record of the common stock on November 28, 1997 was 915.
 
  During fiscal 1997, the Company engaged in no sales of its securities that
were not registered under the Securities Act of 1933.
 
ITEM 6. SELECTED FINANCIAL DATA
 
  The information required by this item is included in ADVO's 1997 Annual
Report to Stockholders on page 20 under the caption "Selected Financial Data"
and is incorporated herein by reference and made a part hereof (see Exhibit
13).
 
                                       6
<PAGE>
 
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
        RESULTS OF OPERATIONS
 
  The information required by this item is included in ADVO's 1997 Annual
Report to Stockholders on pages 21 through 25 under the caption "Financial
Report" and is incorporated herein by reference and made a part hereof (see
Exhibit 13).
 
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
 
  ADVO's consolidated financial statements, together with the Report of
Independent Auditors thereon dated October 21, 1997, appearing on pages 26
through 38 of ADVO's 1997 Annual Report to Stockholders, are incorporated
herein by reference and made a part hereof (see Exhibit 13).
 
  The selected quarterly information required by this item is included under
the caption "Quarterly Financial Data (Unaudited)" on page 37 of ADVO's 1997
Annual Report to Stockholders and is incorporated herein by reference and made
a part hereof (see Exhibit 13).
 
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
        FINANCIAL DISCLOSURE
 
  None.
 
                                   PART III
 
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
 
  The information required by this item, to the extent not included under the
caption "Executive Officers of the Registrant" in Part I of this Annual Report
on Form 10-K, appears on pages 3 and 4 of the Company's definitive proxy
statement dated December 18, 1997 for the annual meeting of stockholders to be
held on January 22, 1998 (the "Proxy Statement"), under the caption "Election
of Directors", and on page 6 of the Proxy Statement under the subcaption
"Section 16 Reports", and is incorporated herein by reference and made a part
hereof.
 
ITEM 11. EXECUTIVE COMPENSATION
 
  The information required by this item is included under the caption
"Executive Compensation" on pages 6 through 16 (except for those portions
appearing under the subcaptions "Report of the Compensation Committee" and
"Company Financial Performance"), and "Governance of the Company" on pages 2
and 3, of ADVO's Proxy Statement and is incorporated herein by reference and
made a part hereof.
 
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
 
  The information required by this item is included under the captions
"Security Ownership of Certain Beneficial Owners" and "Security Ownership of
Management" on page 2 and on pages 5 and 6, respectively, of ADVO's Proxy
Statement and is incorporated herein by reference and made a part hereof.
 
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
 
  The information required by this item is included under the caption "Related
Party Transactions" on page 16 and page 17 of ADVO's Proxy Statement and in
footnote 8 under the caption "Security Ownership of Management" on pages 5 and
6 of ADVO's Proxy Statement and is incorporated herein by reference and made a
part hereof.
 
                                       7
<PAGE>
 
                                    PART IV
 
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
 
(a)(1) Financial Statements. See the Index to Financial Statements and
       Financial Statement Schedules on page F-1.
 
   (2) Financial Statement Schedules. See the Index to Financial Statements
       and Financial Statement Schedules on page F-1.
 
   (3) Exhibits. The following is a list of the exhibits to this Report:
 
<TABLE>
<CAPTION>
EXHIBIT NO.                 EXHIBIT                            WHERE LOCATED
-----------                 -------                            -------------
<S>          <C>                                   <C>
 3(a)        Restated Certificate of Incorporation Incorporated by reference to Exhibit
              of ADVO.                              3(a) to the Company's Form 10 filed
                                                    on September 15, 1986 (No. 1-11720).

 3(b)        Restated By-laws of ADVO.             Incorporated by reference to Exhibit
                                                    3(b) to the Company's Annual Report
                                                    on Form 10-K for the fiscal year
                                                    ended September 30, 1989.

 4(a)        Stockholder Protection Rights         Incorporated by reference to Exhibit
              Agreement, dated as of February 5,    4.1 of the Company's Form 8-K dated
              1993, between the Company and Mellon  February 5, 1993.
              Securities Trust Company, as Rights
              Agent, including Exhibit A and
              Exhibit B.

10(a)        1986 Stock Option Plan of ADVO.*      Incorporated by reference to Exhibit
                                                    4.1 to the Company's Form S-8 filed
                                                    on July 16, 1987 (No. 33-15856).

10(b)        1986 Employee Restricted Stock Plan   Incorporated by reference to Exhibit A
              of ADVO, as amended.*                 to the Company's definitive Proxy
                                                    Statement for the annual meeting held
                                                    on January 16, 1997.

10(c)        1988 Non-Qualified Stock Option Plan  Incorporated by reference to Exhibit B
              and 1993 Stock Option Subplan of      to the Company's definitive Proxy
              ADVO, as amended.*                    Statement for the annual meeting held
                                                    on January 16, 1997.

10(d)        The ADVO Savings Continuation Plan,   Incorporated by reference to Exhibit
              effective January 1, 1988.*           10(n) to the Company's Annual Report
                                                    on Form 10-K for the fiscal year
                                                    ended September 24, 1988.

10(e)        Executive Severance Agreement, dated  Incorporated by reference to Exhibit
              October 17, 1995 between ADVO and     10(k) to the Company's Annual Report
              Robert Kamerschen.*                   on Form 10-K for the fiscal year
                                                    ended September 30, 1995.

10(f)        Executive Severance Agreements, dated Incorporated by reference to Exhibit
              October 17, 1995 between ADVO and     10(m) to the Company's Annual Report
              the executive officers named          on Form 10-K for the fiscal year
              therein.*                             ended September 30, 1995.

10(g)        Executive Severance Agreement, dated  Incorporated by reference to Exhibit
              October 17, 1995 between ADVO and     10(n) to the Company's Annual Report
              Robert S. Hirst.*                     on Form 10-K for the fiscal year
                                                    ended September 30, 1995.
</TABLE>
 
                                       8
<PAGE>
 
<TABLE>
<CAPTION>
EXHIBIT NO.                 EXHIBIT                            WHERE LOCATED
-----------                 -------                            -------------
<S>          <C>                                   <C>
10(h)        Employment Agreement, dated May 29,   Incorporated by reference to Exhibit
              1996 between ADVO and Robert          10(k) to the Company's Annual Report
              Kamerschen.*                          on Form 10-K for the fiscal year
                                                    ended September 28, 1996.

10(i)        Employment Agreement, dated November  Incorporated by reference to Exhibit
              4, 1996 between ADVO and Gary M.      10(l) to the Company's Annual Report
              Mulloy.*                              on Form 10-K for the fiscal year
                                                    ended September 28, 1996.

10(j)        Executive Severance Agreement, dated  Incorporated by reference to Exhibit
              November 4, 1996 between ADVO and     10(m) to the Company's Annual Report
              Gary M. Mulloy.*                      on Form 10-K for the fiscal year
                                                    ended September 28, 1996.

10(k)        Executive Severance Agreement dated   Filed herewith.
              May 19, 1997 between ADVO and A.
              Brian Sanders.*

10(l)        Executive Severance Agreement dated   Filed herewith.
              July 21, 1997 between ADVO and
              Lowell W. Robinson.*

10(m)        Executive Severance Agreement dated   Filed herewith.
              November 7, 1997 between ADVO and
              Donald E. McCombs.*

10(n)        Information Technology Agreement      Incorporated by reference to Exhibit
              dated as of July 16, 1996 between     10(o) to the Company's Annual Report
              ADVO and Integrated Systems           on Form 10-K for the fiscal year
              Solutions Corporation.                ended September 28, 1996.

10(o)        Amended and Restated Credit Agreement Incorporated by reference to Exhibit
              dated September 29, 1997 between      99(b) of the Company's Form 8-K dated
              ADVO and a syndicate of lenders led   September 29, 1997.
              by Chase Manhattan Bank as
              Administrative Agent.

11           Computation of Per Share Earnings.    Filed herewith.

13           1997 Annual Report to Stockholders.   Furnished herewith; however, such
                                                    report, except for those portions
                                                    thereof which are expressly
                                                    incorporated by reference into this
                                                    Annual Report on Form 10-K, is for
                                                    the information of the Commission and
                                                    is not deemed "filed".

21           Subsidiaries of the Registrant.       Filed herewith.

22           Power of Attorney.                    See signature page.

23           Consent of Independent Auditors.      Filed herewith.

27           Financial Data Schedule.              Filed herewith.
</TABLE>
--------
* Management contract or compensatory plan required to be filed as an exhibit
  pursuant to item 14(c) of this report.
 
                                       9
<PAGE>
 
  (b) Reports on Form 8-K.
 
  No report on Form 8-K was filed by the Company with respect to the quarter
ended September 27, 1997.
 
  A report on Form 8-K dated September 29, 1997 was filed by the Company
subsequent to year end. The Form reported under Item 5 thereof, that the
Company announced it had increased its previously announced stock repurchase
authorization from 2 million shares to 3.2 million shares. In connection with
the increased authorization, the Company purchased 1,936,098 shares of its
common stock from Warburg, Pincus Capital Partners, L. P. for $34.8 million,
at $18.00 per share. The closing price on September 29, 1997 was $18 3/8 per
share.
 
  The Company also announced it had renegotiated its March 4, 1996 credit
agreement with a consortium of banks, led by Chase Manhattan Bank. The most
prominent features of the new agreement included an increased credit limit to
$300 million (from $250 million); a reduction in the interest rate; and an
increased limit on the Company's authorization to buyback its stock from $40
million to $100 million.
 
                                      10
<PAGE>
 
                                  SIGNATURES
 
  PURSUANT TO THE REQUIREMENTS OF SECTION 13 OR 15(D) 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.
 
Date:     December 18, 1997              ADVO, Inc. 
      -------------------------------                
 
                                                                             
                                          By:            Robert S. Hirst /s/ 
                                              ---------------------------------
                                                         ROBERT S. HIRST
                                                         VICE PRESIDENT AND
                                                         CONTROLLER
 
  PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, THIS
REPORT HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS ON BEHALF OF THE
REGISTRANT AND IN THE CAPACITIES AND ON THE DATES INDICATED. EACH PERSON WHOSE
SIGNATURE APPEARS BELOW HEREBY CONSTITUTES DAVID M. STIGLER AND ROBERT S.
HIRST, AND EACH OF THEM SINGLY, SUCH PERSON'S TRUE AND LAWFUL ATTORNEYS, WITH
FULL POWER TO THEM AND EACH OF THEM, TO SIGN FOR SUCH PERSON AND IN SUCH
PERSON'S NAME AND CAPACITY AS INDICATED BELOW, ANY AND ALL AMENDMENTS TO THIS
REPORT, HEREBY RATIFYING AND CONFIRMING SUCH PERSON'S SIGNATURE AS IT MAY BE
SIGNED BY SAID ATTORNEYS TO ANY AND ALL AMENDMENTS.
 
        DATE                   SIGNATURE                       TITLE
 
  December 18, 1997   Robert Kamerschen /s/          Chairman, Chief Executive
                      ----------------------------    Officer and Director
                      ROBERT KAMERSCHEN               (Principal Executive
                                                      Officer)
 
  December 18, 1997   Gary M. Mulloy /s/             President, Chief
                      ----------------------------    Operating Officer and
                      GARY M. MULLOY                  Director
 
  December 18, 1997   Donald E. McCombs /s/          Senior Vice President and
                      ----------------------------    Chief Financial Officer
                      DONALD E. MCCOMBS               (Principal Financial
                                                      Officer)
 
  December 18, 1997   Robert S. Hirst /s/            Vice President and
                      ----------------------------    Controller (Principal
                      ROBERT S. HIRST                 Accounting Officer)
 
  December 18, 1997   Bruce Crawford /s/             Director
                      ----------------------------
                      BRUCE CRAWFORD
 
  December 18, 1997   David F. Dyer /s/              Director
                      ----------------------------
                      DAVID F. DYER
 
  December 18, 1997   James A. Eskridge /s/          Director
                      ----------------------------
                      JAMES A. ESKRIDGE
 
  December 18, 1997   Jack W. Fritz /s/              Director
                      ----------------------------
                      JACK W. FRITZ
 
  December 18, 1997   Howard H. Newman /s/           Director
                      ----------------------------
                      HOWARD H. NEWMAN
 
  December 18, 1997   John R. Rockwell /s/           Director
                      ----------------------------
                      JOHN R. ROCKWELL
 
  December 18, 1997   John L. Vogelstein /s/         Director
                      ----------------------------
                      JOHN L. VOGELSTEIN
 
                                      11
<PAGE>
 
                                  ADVO, INC.
 
                         INDEX TO FINANCIAL STATEMENTS
                       AND FINANCIAL STATEMENT SCHEDULES
 
<TABLE>
<CAPTION>
                                                                           PAGE
                                                                           ----
<S>                                                                        <C>
Report of independent auditors...........................................    *
Consolidated statements of operations for the years ended September 27,
 1997, September 28, 1996 and September 30, 1995.........................    *
Consolidated balance sheets at September 27, 1997 and September 28, 1996.    *
Consolidated statements of cash flows for the years ended September 27,
 1997, September 28, 1996 and September 30, 1995.........................    *
Consolidated statements of changes in stockholders' equity (deficiency)
 for the years ended September 27, 1997, September 28, 1996 and September
 30, 1995................................................................    *
Notes to consolidated financial statements...............................    *
Consolidated Schedules
  II-Valuation and Qualifying Accounts...................................  F-2
</TABLE>
 
  All other schedules have been omitted since the required information is not
present.
--------
*  Incorporated herein by reference from pages 26 to 38 of the ADVO, Inc. 1997
   Annual Report to Stockholders.
 
                                      F-1
<PAGE>
 
                                   ADVO, INC.
 
                SCHEDULE II -- VALUATION AND QUALIFYING ACCOUNTS
                                 (IN THOUSANDS)
 
<TABLE>
<CAPTION>
        COLUMN A           COLUMN B        COLUMN C           COLUMN D        COLUMN E
        --------          ---------- ---------------------   ----------      ----------
                                           ADDITIONS
                                     ---------------------
                          BALANCE AT CHARGED TO CHARGED TO   DEDUCTIONS      BALANCE AT
                          BEGINNING  COSTS AND    OTHER         FROM           END OF
      DESCRIPTION         OF PERIOD   EXPENSES   ACCOUNTS     RESERVES         PERIOD
      -----------         ---------- ---------- ----------   ----------      ----------
<S>                       <C>        <C>        <C>          <C>             <C>
Year ended September 30,
 1995:
Allowances for sales ad-
 justments..............   $ 3,321     $  --     $  5,758(b)  $ 6,953         $ 2,126
Allowances for doubtful
 accounts...............     1,784      2,953         --        3,445(a)(c)     1,292
Restructuring reserve...    17,109        --          --        7,230           9,879
Accumulated amortization
 Goodwill...............       703        329         --          --            1,032
Accumulated amortization
 Intangibles............     3,987      1,015         --          604           4,398
                           -------     ------    --------     -------         -------
                           $26,904     $4,297    $  5,758     $18,232         $18,727
                           =======     ======    ========     =======         =======
Year ended September 28,
 1996:
Allowances for sales ad-
 justments..............   $ 2,126     $  --     $ 10,007(b)  $ 9,297         $ 2,836
Allowances for doubtful
 accounts...............     1,292      3,701         --        3,603(a)        1,390
Restructuring reserve...     9,879        --          --        7,820           2,059
Accumulated amortization
 Goodwill...............     1,032        390         --          --            1,422
Accumulated amortization
 Intangibles............     4,398        892         --          --            5,290
                           -------     ------    --------     -------         -------
                           $18,727     $4,983    $ 10,007     $20,720         $12,997
                           =======     ======    ========     =======         =======
Year ended September 27,
 1997:
Allowances for sales ad-
 justments..............   $ 2,836     $  --     $  4,889(b)  $ 5,143         $ 2,582
Allowances for doubtful
 accounts...............     1,390      5,374         --        4,186(a)        2,578
Restructuring reserve...     2,059        --          --        1,711             348
Accumulated amortization
 Goodwill...............     1,422        392         --          --            1,814
Accumulated amortization
 Intangibles............     5,290        729         --          --            6,019
                           -------     ------    --------     -------         -------
                           $12,997     $6,495    $  4,889     $11,040         $13,341
                           =======     ======    ========     =======         =======
</TABLE>
--------
(a)  Write off of uncollectible accounts, net of recoveries on accounts
     previously written off.
(b)  Reduction of revenues.
(c)  Reclassification of allowances related to discontinued operations.
 
                                      F-2