SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   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 NOVEMBER 28, 1998 OR

       TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
       EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM
       ------------------  TO  -----------------
                                         0-24390
Commission file number . . . . . . . . . . . . . . . . .

                               TREND - LINES, INC.
 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
             (Exact name of registrant as specified in its charter)

     Massachusetts                                 04-2722797
 . . . . . . . . . . . . .                    . . . . . . . . . . . . .
(State or other jurisdiction of              (I.R.S. Employer
 incorporation or organization)               Identification No.)


135 American Legion Highway, Revere , Massachusetts      02151
 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(Address of principal executive office)                (Zip Code)


                                (617) 853 - 0900
             . . . . . . . . . . . . . . . . . . . . . . . . . . . .
              (Registrant's telephone number, including area code)


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed  by  Section  13 or 15 (d) of the  Securities  Exchange  Act of 1934
during the preceding 12 months ( or for such shorter  period that the registrant
was  required  to file such  reports),  and (2) has been  subject to such filing
requirements for the past 90 days.
Yes ..X...    No......

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

  CLASS                         NUMBER OF SHARES OUTSTANDING NOVEMBER 30, 1998 
  -----                         ------------------------------------------------

 Class A Common Stock, $.01 par value                       5,923,841

 Class B Common Stock, $.01 par value                       4,726,794


                        Trend-Lines, Inc. and Subsidiary

                                     INDEX

                                                                          Page 

Part I -  Financial Information

Item 1.   Financial Statements

          Condensed Consolidated Balance Sheets
          November 28, 1998 (Unaudited) and February 28, 1998               3

          Condensed Consolidated Statements of Operations
          Three Months Ended November 28, 1998 and
          November 29, 1997 and Nine Months Ended November 28, 1998
          and November 29, 1997 (Unaudited)                                 4

          Condensed Consolidated Statements of Cash Flows
          Nine Months Ended November 28, 1998 and
          November 29, 1997 (Unaudited)                                     5

          Notes to Condensed Consolidated Financial Statements              6-7

Item 2.   Management's Discussion and Analysis of Financial Condition
          And Results of Operations                                         8-12

Part II - Other Information

Item 1.   Legal Proceedings                                                 13

Item 2.   Changes in Securities                                             13

Item 3.   Defaults Upon Senior Securities                                   13

Item 4.   Submission of Matters to a Vote of Security Holders               13

Item 5.   Other Information                                                 13

Item 6.   Exhibits and Reports on Form 8-K                                  13

Signatures                                                                  14


                        TREND-LINES, INC. AND SUBSIDIARY

                     CONDENSED CONSOLIDATED BALANCE SHEETS
                      (IN THOUSANDS, EXCEPT SHARE AMOUNTS)

ASSETS


                                                                                           November 28
                                                                                               1998        February 28,
                                                                                           (Unaudited)         1998
                                                                                          -------------   -------------
                                                                                                       

             CURRENT ASSETS:
                    Cash and cash equivalents                                                 $   1,038    $     669
                    Accounts receivable, net                                                     22,677       18,546
                    Inventories                                                                 126,965      102,172
                    Prepaid expenses and other current assets                                     7,188        6,906
                                                                                              ---------    ---------

                                      Total current assets                                      157,868      128,293

             PROPERTY AND EQUIPMENT, NET                                                         21,806       19,387

             INTANGIBLE ASSETS, NET                                                               6,709        6,973

             OTHER ASSETS                                                                           759          799
                                                                                              ---------    ---------

                                                                                              $ 187,142    $ 155,452
                                                                                              =========    =========

LIABILITIES AND STOCKHOLDERS' EQUITY
             CURRENT LIABILITIES:
                    Bank credit facility                                                      $  78,304    $  43,801
                    Current portion of capital lease obligations                                    813          777
                    Accounts payable                                                             63,343       53,830
                    Accrued expenses                                                              4,462        8,111
                                                                                              ---------    ---------

                                      Total current liabilities                                 146,922      106,519
                                                                                              ---------    ---------

             CAPITAL LEASE OBLIGATIONS, NET OF CURRENT PORTION                                      570        1,182
                                                                                              ---------    ---------

             STOCKHOLDERS' EQUITY:
                    Common stock, $.01 par value -
                          Class A --
                                Authorized - 20,000,000 shares
                                Issued  - 6,423,841 and 6,385,178 shares at
                                      November 28, 1998 and February 28, 1998, respectively          64           64
                          Class B --
                                Authorized - 5,000,000 shares
                                Issued and outstanding - 4,726,794 and 4,738,066 shares at
                                      November 28, 1998 and February 28, 1998, respectively          47           47
                    Additional paid-in capital                                                   41,625       41,524
                    Retained earnings                                                               374        8,576
                    Less: 500,000 Class A shares held in treasury at November 28, 1998
                          and February 28, 1998, at cost                                         (2,460)      (2,460)
                                                                                              ---------    ---------

                                      Total stockholders' equity                                 39,650       47,751
                                                                                              ---------    ---------

                                                                                              $ 187,142    $ 155,452
                                                                                              =========    =========

           See notes to condensed consolidated financial statements.


                        TREND-LINES, INC. AND SUBSIDIARY

                 CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
               (IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)
                                   (Unaudited)


                                                                         Three months ended           Nine months ended
                                                                    November 28    November 29    November 28    November 29
                                                                        1998           1997           1998           1997
                                                                   -------------  -------------  ------------    -------------

                                                                                                              
NET SALES                                                          $     60,102   $     52,357   $    184,638    $    160,266
COST OF SALES                                                            41,735         36,141        128,683         108,704
                                                                   ------------   ------------   ------------    ------------

       Gross Profit                                                      18,367         16,216         55,955          51,562

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES                             16,730         13,872         63,388          46,416
                                                                   ------------   ------------   ------------    ------------

       Income (loss) from operations                                      1,637          2,344         (7,433)          5,146

INTEREST EXPENSE, NET                                                     1,578            944          3,999           2,374
                                                                   ------------   ------------   ------------    ------------

       Income (loss) before provision (benefit) for income taxes             59          1,400        (11,432)          2,772

PROVISION (BENEFIT)  FOR  INCOME TAXES                                     --              546         (3,230)          1,081
                                                                   ------------   ------------   ------------    ------------

       Net income (loss)                                           $         59   $        854   $     (8,202)   $      1,691
                                                                   ============   ============   ============    ============


BASIC NET INCOME (LOSS) PER SHARE                                  $       0.01   $       0.08   $      (0.77)   $       0.16
                                                                   ============   ============   ============    ============


DILUTED NET INCOME (LOSS) PER SHARE                                $       0.01   $       0.08   $      (0.77)   $       0.15
                                                                   ============   ============   ============    ============

BASIC WEIGHTED AVERAGE SHARES OUTSTANDING (Note 2)                   10,650,635     10,589,070     10,647,610      10,581,109
                                                                   ============   ============   ============    ============
                                                              
DILUTED WEIGHTED AVERAGE SHARES OUTSTANDING (Note 2)                 10,723,142     11,174,886     10,647,610      11,119,541
                                                                   ============   ============   ============    ============

           See notes to condensed consolidated financial statements.


                        TREND-LINES, INC. AND SUBSIDIARY

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)


                                                                           Nine months ended
                                                                        November 28  November 29
                                                                            1998         1997
                                                                        -----------  -----------
                                                                               
CASH FLOWS FROM OPERATING ACTIVITIES:
        Net income (loss)                                                $ (8,202)   $  1,691
        Adjustments to reconcile net income (loss)  to net cash
        provided by (used in) operating activities--
               Depreciation and amortization                                3,503       1,951
               Changes in current assets and liabilities
                      Accounts receivable                                  (4,132)     (3,549)
                      Deferred income taxes                                  --          --
                      Inventories                                         (24,793)     (3,078)
                      Prepaid expenses and other current assets              (282)         89
                      Accounts payable                                      9,512     (11,382)
                      Accrued expenses                                     (3,647)        538
                                                                         --------    --------

                             Net cash (used in) operating activities      (28,041)    (13,740)
                                                                         --------    --------

CASH FLOWS FROM INVESTING ACTIVITIES:
        Purchases of property and equipment                                (5,658)     (4,859)
        Proceeds from sale of property and equipment                         --             9
        Increase in other assets                                               40         135
                                                                         --------    --------

                             Net cash (used in) investing activities       (5,618)     (4,715)
                                                                         --------    --------

CASH FLOWS FROM FINANCING ACTIVITIES:

        Net borrowings under bank credit facilities                        34,503      18,411
        Payments on capital lease obligations                                (576)       (514)
        Proceeds from exercise of stock options                               101         141
        Purchases of treasury stock                                          --          (310)
                                                                         --------    --------

                             Net cash provided by financing activities     34,028      17,728
                                                                         --------    --------

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                          369        (727)

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD                                669       1,006
                                                                         --------    --------

CASH AND CASH EQUIVALENTS, END OF PERIOD                                 $  1,038    $    279
                                                                         ========    ========

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
        Cash paid for -
               Interest                                                  $  3,599    $  2,289
                                                                         ========    ========
               Income taxes                                              $    339    $  1,622
                                                                         ========    ========

            See notes to condensed consolidated financial statements.


                        TREND-LINES, INC. AND SUBSIDIARY
                    NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


1. Basis of Presentation

The information set forth in these financial  statements is unaudited and may be
subject  to normal  year end  adjustments.  In the  opinion of  management,  the
information  reflects  all  adjustments,   which  consist  of  normal  recurring
accruals,  that are  considered  necessary  to present a fair  statement  of the
results of  operations of  Trend-Lines,  Inc.  (the  "Company")  for the interim
periods presented.  The operating results for the nine months ended November 28,
1998 are not necessarily indicative of the results to be expected for the fiscal
year ending February 27, 1999.

The financial statements presented herein should be read in conjunction with the
financial  statements  included in the Company's  Annual Report on Form 10-K for
the fiscal year February 28, 1998. Certain  information in footnote  disclosures
normally  included in  financial  statements  has been  condensed  or omitted in
accordance  with the  rules  and  regulations  of the  Securities  and  Exchange
Commission.


2. Earnings Per Share Data

In February 1997, the Financial  Accounting  Standards Board issued SFAS No. 128
Earning Per Share,  which changed the method of calculating  earnings per share.
SFAS 128 requires the  presentation of "basic"  earnings per share and "diluted"
earnings  per share.  Basic  earnings  per share is computed by dividing the net
income available to common shareholders by the weighted average number of shares
of common stock  outstanding.  For the purposes of calculating  diluted earnings
per share,  the denominator  includes both the weighted average number of common
stock  outstanding and the dilutive effect of common stock  equivalents  such as
stock options and warrants.  The Company  adopted SFAS 128 in the fourth quarter
of fiscal 1997.  All prior period per share amounts have been restated to comply
with SFAS 128.

Potentially  dilutive securities include outstanding options under the Company's
stock  option  plan.  For the quarter  ended,  November  28,  1998,  the diluted
earnings  per share  calculation  has been  computed  using  the basic  weighted
average  shares  outstanding,   as  the  potentially   dilutive  securities  are
anti-dilutive.  The number of  potentially  dilutive  shares  excluded  from the
earnings per share  calculation  was 266,413 for nine months ended  November 28,
1998.  Below is a summary of the shares  used in  calculating  basic and diluted
earnings per share:




                                                  Three Months Ended             Nine Months Ended
                                              November 28   November 29     November 28   November 29
                                                  1998          1997            1998          1997

                                                                                 
Basic weighted average shares outstanding      10,650,635    10,589,070      10,647,610    10,581,109
Dilutive effect of stock options                   72,507       585,816               0       538,432
                                               ----------    ----------      ----------    ----------

Dilutede weighted averages shares outstanding  10,723,142    11,174,886      10,647,610    11,119,541
                                               ==========    ==========      ==========    ==========



3.    Bank Credit Facility

During fiscal 1996, the Company entered into a secured line-of-credit  agreement
with a bank (the "credit facility") that, as amended during fiscal 1997, expires
on December 31, 2000. The credit facility bears interest at the bank's reference
rate plus .75%  (9.50% at  November  28,  1998) or LIBOR plus  2.25%  (7.875% at
November 28, 1998).  If for any 12 month rolling  period the fixed charges ratio
exceeds  certain  limits,  as defined,  the bank's  interest  rate on the credit
facility is decreased by .25% for the period immediately  following such rolling
period.  A  commitment  fee of .375% per year of the average  unused  commitment
amount, as defined, is payable monthly. The credit facility allows for borrowing
up to $80 million  based on a percentage  of  inventory  (the  "advance  rate").
Borrowings  include  50% of the  amounts  reserved  for  outstanding  letters of
credit.

At November 28, 1998, the Company had approximately  $78.3 million of borrowings
outstanding and  approximately  $200,000 of letters of credit  outstanding.  The
Company  had  approximately  $1.2  million in  available  borrowings  under this
facility at November 28, 1998. The bank has a security interest in substantially
all assets of the Company.  The bank credit facility  agreement contains certain
financial covenants,  including,  but not limited to, maintaining minimum levels
of tangible net worth,  and interest  coverage ratios and limitations on capital
expenditures.  At November  28,  1998,  the Company was in  compliance  with all
financial covenants.

Pursuant to an amendment  with its bank dated as of September 30, 1998, the bank
amended  the credit  facility  agreement  to increase  the  advance  rate to 70%
through December 31, 1998. On and after January 1, 1999 the advance rate will be
65%.


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

Results of Operations

Net sales for the third  quarter of fiscal 1998  increased by $7.7  million,  or
14.7%, from $52.4 million for the third quarter of fiscal 1997 to $60.1 million.
Net retail sales for the third quarter of 1998 increased  $10.7 million or 27.0%
from  $39.7  million  for the third  quarter  of fiscal  1997 to $50.4  million.
However,  net catalog sales for the third quarter of fiscal 1998  decreased $3.0
million or 23.6%,  from $12.7  million  for the third  quarter of fiscal 1997 to
$9.7 million for fiscal 1998. The decrease in net catalog sales was attributable
to the Company's opening of retail stores in areas only previously served by its
catalog.  The Company plans to continue its practice of not mailing  catalogs to
areas where it operates  retail  stores.  The revenue growth of retail stores is
attributable to the maturation and expansion of the Company's retail store base.
The store base  expanded  over 31.4% from 175  locations at the end of the third
quarter  of fiscal  1997 to 230  locations  at the end of the third  quarter  of
fiscal 1998.  Comparable net store sales for  Woodworkers  Warehouse / Post Tool
stores and Golf Day stores for the third  quarter of fiscal  1998  increased  by
3.8% as compared to the third quarter of fiscal 1997.

Net sales for the first nine months of fiscal 1998  increased by $24.3  million,
or 15.2%, from $160.3 million for the first nine months of fiscal 1997 to $184.6
million for the first nine  months of fiscal  1998.  Retail  sales for the first
nine  months of fiscal  1998  increased  $34.5  million,  or 29.3%,  from $117.7
million for the first nine months of fiscal 1997 to $152.2 million for the first
nine months of fiscal 1998. In contrast, catalog sales for the first nine months
of fiscal 1998  decreased  $10.0 million,  or 23.5%,  from $42.5 million for the
first nine months of fiscal  1997 to $32.5  million for the first nine months of
fiscal 1998. The decrease in net catalog sales was attributable to the Company's
openings of retail stores in areas  previously only served by its catalogs.  The
Company  intends to  continue to mail  catalogs  only to areas not served by its
retail  stores.  The revenue  growth of retail  stores was  attributable  to the
maturation  and expansion of the  Company's  retail base.  Comparable  net store
sales for  Woodworkers  Warehouse  / Post Tool Stores and Golf Day for the first
nine  months of fiscal  1998  increased  by 1.2% as  compared  to the first nine
months of fiscal 1997.

Following is a summary of retail store growth.

                                                 Third Quarter      Year To Date
Stores operated at the beginning of the period        217               204
               Stores opened during the period         17                35
               Stores closed during the period         4                 9
                                                       -                 -
      Stores operated at the end of the period        230               230
                                                      ===               ===

Gross profit for the third quarter of fiscal 1998  increased  $2.2  million,  or
13.3%,  from $16.2 million for the third quarter of fiscal 1997 to $18.4 million
for the third quarter of fiscal 1998. As a percentage of net sales, gross profit
decreased  .4% from 31.0% of net sales for the third  quarter of fiscal  1997 to
30.6% of net sales in the third  quarter of fiscal  1998.  The decrease in gross
profit as a percentage of net sales was primarily due to the Company's  changing
sales mix, given the percentage  increase in retail store sales,  as the catalog
business has higher gross margins than retail store operations.


Gross  profit for the first nine months of fiscal 1998  increased  $4.4  million
from $51.6 million for the first nine months of fiscal 1997 to $56.0 million for
the first nine months of fiscal 1998. As a percentage of net sales, gross profit
decreased  1.9% from 32.2% of net sales for the first nine months of fiscal 1997
to 30.3% for the first nine months of fiscal 1998.

Selling,  general and  administrative  expenses for the third  quarter of fiscal
1998 increased $2.8 million,  or 20.6%, from $13.9 million for the third quarter
of fiscal  1997 to $16.7  million  for the third  quarter of fiscal  1998.  As a
percentage of net sales, selling,  general and administrative expenses increased
1.3% from 26.5% of net sales in the third quarter of fiscal 1997 to 27.8% of net
sales in the third  quarter of fiscal  1998.  The dollar  increases  in selling,
general and  administrative  expenses  are  primarily  related to the  Company's
continuing  retail expansion to 230 locations,  which is a 31.4% increase in the
number of stores operated.  The increase in selling,  general and administrative
expenses as a percentage of net sales was primarily  attributable  to lower than
anticipated  retail store sales,  coupled with increases in  administrative  and
store staffing levels.

Selling, general and administrative expenses for the first nine months of fiscal
1998 increased  36.7%,  or $17.0 million,  from $46.4 million for the first nine
months of fiscal 1997 to $63.4 million for the first nine months of fiscal 1998.
As a  percentage  of net sales,  selling,  general and  administrative  expenses
increased  5.3% from 29.0% of net sales for the first nine months of fiscal 1997
to 34.3% of net sales for the first  nine  months  of fiscal  1998.  The  dollar
increases  in selling,  general,  and  administrative  expenses  were  primarily
related to the Company's continuing retail expansion.

Interest expense,  net of interest income,  for the third quarter of fiscal 1998
increased by $700,000  from $900,000 in the third quarter of fiscal 1997 to $1.6
million in the third  quarter of fiscal 1998.  The increase in interest  expense
was attributable to the increase in the amount  outstanding  under the Company's
bank credit facility.

Interest  expense,  net of interest income,  for the first nine months of fiscal
1998  increased  $1.6  million  from $2.4  million  for the first nine months of
fiscal 1997 to $4.0 million in first nine months of fiscal 1998.

The Company  recognized  a tax benefit for the first nine months of 1998 only to
the extent that a tax loss  carryback was  available.  As a result,  the Company
recognized no tax expense in the third quarter.

Liquidity and Capital Resources

The Company  incurred  operating  losses  during the first nine months of fiscal
1998 and  used  funds  provided  by its bank  credit  facility  to meet its cash
operating needs during this period.  The bank credit facility agreement contains
certain financial covenants,  including, but not limited to, maintaining minimum
levels of tangible net worth and interest  coverage  ratios and  limitations  on
capital  expenditures.  At November 28, 1998, the Company was in compliance with
all  financial  covenants.  Pursuant to an  amendment  with its bank dated as of
September  30, 1998,  the bank amended the credit  facility  with respect to the
financial covenants and advance rates for future periods.

The  modified  covenants  require the  Company to maintain an interest  coverage
ratio  of 1.80 : 1.00  for the  third  quarter  of  fiscal  1998 and 2.50 : 1.00
thereafter,  and  adjusted  tangible  net  worth as of the last day of the third
quarter of fiscal 1998 of $39.5  million and as of the last day of each  quarter
through the second  quarter of fiscal 1999 of $41.0  million and for each fiscal
quarter thereafter $42.0 million.

The Company  believes that projected  cash flows from  operations in combination
with current  available  resources are sufficient to meet working capital needs,
such as store  openings and debt  payments.  Achievement of projected cash flows
from  operations,  however will be dependent  upon the  Company's  attainment of
sales,  gross profit,  expense and trade support levels that are consistent with
its financial  plans.  Such operating  performance will be subject to financial,
economic and other factors affecting the industry and operations of the Company,
including  factors  beyond its control,  and there can be no assurance  that the
Company's  plans will be achieved.  If projected cash flows from  operations are
not  realized,   then  the  Company  may  have  to  explore  various   available
alternatives,  including obtaining further  modification to its existing lending
arrangements or attempting to locate additional sources of financing.

The Company's working capital decreased by $10.9 million,  from $21.8 million as
of February  28, 1998 to $10.9  million as of November  28,  1998.  The decrease
resulted  primarily from an increase in the net  borrowings  under the Company's
bank  credit  facility  of $34.5  million,  which was offset by a $24.8  million
increase in inventory.

The cash used in operating  activities  was  approximately  $28.1  million.  The
primary  uses of the  cash  were  for a net  loss of $8.2  million,  and a $24.8
million  increase  in  inventories,  with a $3.7  million  decrease  in  accrued
expenses, all of which was offset by $9.5 million increase in accounts payable.

The net cash used in investing  activities was approximately  $5.7 million.  The
main use of the cash was for the purchase of property and equipment required for
the Company's retail expansion.

The net cash provided by financing  activities was approximately  $34.0 million,
primarily  attributable  to the increase in  borrowings  on the  Company's  bank
credit facility of $34.5 million.

During fiscal 1996, the Company entered into a secured line-of-credit  agreement
with a bank (the "credit facility") that, as amended during fiscal 1997, expires
on December 31, 2000. The credit facility bears interest at the bank's reference
rate plus .75%  (9.50% at  November  28,  1998) or LIBOR plus  2.25%  (7.875% at
November 28, 1998).  If for any 12 month rolling  period the fixed charges ratio
exceeds  certain  limits,  as defined,  the bank's  interest  rate on the credit
facility is decreased by .25% for the period immediately  following such rolling
period.  A  commitment  fee of .375% per year of the average  unused  commitment
amount, as defined, is payable monthly. The credit facility allows for borrowing
up to $80 million  based on a percentage  of  inventory  (the  "advance  rate").
Borrowings  include  50% of the  amounts  reserved  for  outstanding  letters of
credit.

At November 28, 1998, the Company had approximately  $78.3 million of borrowings
outstanding and  approximately  $200,000 of letters of credit  outstanding.  The
Company  had  approximately  $1.2  million in  available  borrowings  under this
facility at November 28, 1998. The bank has a security interest in substantially
all assets of the Company.

Pursuant to an amendment  with its bank dated as of September 30, 1998, the bank
amended  the credit  facility  agreement  to increase  the  advance  rate to 70%
through December 31, 1998. On and after January 1, 1999 the advance rate will be
to  65%.

The  Company  anticipates  that in fiscal  1998,  it will  continue to invest in
leasehold  improvements  and  equipment  to support its retail  store  expansion
plans. In addition,  the Company's  expansion plans will require the use of cash
to fund increased inventories associated with the operation of additional retail
stores. The Company estimates that the cost of opening a new store (exclusive of
distribution  center  inventory)  averages  approximately   $350,000,  of  which
$290,000  consists of inventory,  in the case of tool store,  and  approximately
$425,000, of which $300,000 consists of inventory,  in the case of a golf store.
In each case,  a portion of the  inventory  investment  is  financed  with trade
credit.  The Company opened nine new tool stores and eight new golf stores,  and
closed two golf stores and two tool stores in the third  quarter of fiscal 1998.
For the  balance  of  fiscal  1998,  the  Company  currently  plans  to open one
additional tool store.

Like many other  companies,  the Year 2000  computer  issue creates risk for the
Company.  If both information  technology systems and imbedded technology do not
correctly  recognize  date  information  when the year changes to 2000, it could
have an adverse  impact on the  Company's  operations.  The Company is currently
updating its software to accommodate  programming logic that properly interprets
Year 2000  dates,  and plans to review  embedded  technology  used in  equipment
provided  by outside  vendors  with the  manufacturers  of such  equipment.  The
Company does not  anticipate  difficulty to resolve  issues  related to embedded
technology  in  the  equipment  provided  by  other  manufacturers.  Except  for
merchandising  and call center  applications,  all software is under maintenance
agreements  by software  companies  that provide  updated,  Year 2000  compliant
software.  The  Company  is in the  process  of  replacing  its call  center and
merchandising software with new, Year 2000 compliant applications to be supplied
by outside vendors at a cost estimated at approximately $2.0 million.

Based on the Company's  work to date and assuming that the Company's call center
and merchandising  software  replacement projects can be implemented as planned,
the Company  believes that it will be Year 2000  compliant and that future costs
relating to the Year 2000 issue will not have a material impact on the Company's
consolidated financial position, results of operations or cash flows.

Since the Company relies on third-party suppliers for many systems, products and
services including merchandise,  telecommunications and call center support, the
Company  could be adversely  affected if these  suppliers do not make  necessary
changes to their own systems and products  successfully  and in a timely manner.
The Company will make inquiries with major third party suppliers regarding their
Year 2000 compliance. However, there can be no assurance that such third parties
will provide complete or accurate Year 2000 readiness disclosures.

Management  of the  Company  believes  it has an  effective  program in place to
resolve the Year 2000 issue in a timely  manner.  Nevertheless,  since it is not
possible to  anticipate  all possible  future  outcomes,  especially  when third
parties are involved, there could be circumstances in which the Company could be
adversely affected.  For example, the Company could encounter problems in taking
customer orders, shipping products,  invoicing customers or collecting payments.
The amount of  potential  lost  revenue or related  consequences  as a result of
these unlikely contingencies has not been estimated.

Once  the  Year  2000  remediation   process  reaches  a  higher  percentage  of
completion,  the  Company  intends  to work  on a  contingency  plan to  address
remaining material risks, if any.

Impact of Inflation

The Company does not believe that inflation has had a material impact on its net
sales or results of operations.

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995

Statements  included in this report that do not relate to present or  historical
conditions  are  "forward-looking  statements"  within  the  meaning of the Safe
Harbor  provisions  of the  Private  Securities  Litigation  Reform Act of 1995.
Additional oral or written forward-looking statements may be made by the Company
from time to time, and such  statements may be included in documents  other than
this report that are filed with the  Securities  and Exchange  Commission.  Such
forward-looking  statements  involve  risks and  uncertainties  that could cause
results  or  outcomes  to  differ   materially  from  those  expressed  in  such
forward-looking  statements.  Forward-looking  statements  in  this  report  and
elsewhere may include without  limitation,  statements relating to the Company's
plans,  strategies,  objectives,   expectations,   intentions  and  adequacy  of
resources and are intended to be made pursuant to the safe harbor  provisions of
the Private Securities  Litigation Reform Act of 1995. Words such as "believes,"
"forecasts,"  "intends," "possible," "expects,"  "estimates,"  "anticipates," or
"plans"  and  similar  expressions  are  intended  to  identify  forward-looking
statements. Investors are cautioned that such forward-looking statements involve
risks and  uncertainties  including  without  limitation the following:  (i) the
Company's plans, strategies, objectives, expectations and intentions are subject
to  change  at  any  time  at the  discretion  of the  Company;  (ii)  increased
competition,  a change in the retail business in the tool and/or golf sectors or
a change in the  Company's  merchandise  mix;  (iii) a change  in the  Company's
advertising,  pricing  policies or its net product costs after all discounts and
incentives;  (iv) the Company's plans and results of operations will be affected
by the Company's  ability to manage its growth and inventory as well as year end
inventory and adjustments;  (v) the timing and effectiveness of programs dealing
with the Year 2000 issue and the Company's warehouse management system; and (vi)
other  risks and  uncertainties  indicated  from  time to time in the  Company's
filings with the Securities and Exchange Commission.


                        TREND-LINES, INC. AND SUBSIDIARY

Part II - Other Information

Item 1.       Legal Proceedings

     Not applicable

Item 2.  Changes in Securities

     Not applicable

Item 3.  Defaults Upon Senior Securities

     Not applicable

Item 4.  Submission of matters to a Vote of Security Holders

     Not applicable

Item 5.  Other Information

     Not applicable

Item 6.  Exhibits and Reports on Form 8-K

     (a)   Exhibits

Exhibit Number

27   Financial Data Schedule (furnished to the Securities and Exchange
     Commission for Electronic Data Gathering, Analysis and Retrieval [Edgar]
     purposes only)

     (b)   Reports on Form 8-K - not applicable

                                   SIGNATURES

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned, thereunto duly authorized.


                                TREND-LINES, INC.
                                Registrant



Date: January 12, 1999          By: /s/ Stanley D. Black
                                Name: Stanley D. Black
                                Title: (Chief Executive Officer)



                                By: /s/ Karl P. Sniady
                                Name: Karl P. Sniady
                                Title: (Executive Vice President,
                                        Chief Financial Officer)