content: UNITED STATES
                         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:
                                   MARCH 31, 1997
                                         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 1-3872
  
  
                             STORER COMMUNICATIONS, INC.
               (Exact name of registrant as specified in its charter)
  
  
  
  
                  DELAWARE                                      59-2638096
  --------------------------------------------------------------------------------
           (State or other jurisdiction of                   (I.R.S. Employer
           incorporation or organization)                    Identification No.)
  
                   1500 Market Street, Philadelphia, PA 19102-2148
  --------------------------------------------------------------------------------
                      (Address of principal executive offices)
                                     (Zip Code)
  
  Registrant's telephone number, including area code:  (215) 665-1700
  
                             --------------------------
  
  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  twelve months (or for such shorter period that the registrant was
  required to file such  reports),  and (2) has been subject to such  requirements
  for the past 90 days.
  
           Yes  _X_                                           No ___
  
                             --------------------------
  
  As of March 31, 1997, there were 239.99 shares of Common Stock outstanding.
  
  The Registrant  meets the conditions set forth in General  Instructions H (1)(a)
  and (b) of Form  10-Q  and is  therefore  filing  this  form  with  the  reduced
  disclosure format.
  
  <PAGE>
                    STORER COMMUNICATIONS, INC. AND SUBSIDIARIES
                                      FORM 10-Q
                            QUARTER ENDED MARCH 31, 1997
  
                                  TABLE OF CONTENTS
  
                                                                            Page
                                                                           Number
  PART I.   FINANCIAL INFORMATION
  
            Item 1.   Financial Statements
  
                      Condensed Consolidated Balance Sheet
                      as of March 31, 1997 and December 31,
                      1996 (Unaudited)..........................................2
  
                      Condensed Consolidated Statement of
                      Operations and Accumulated Deficit for
                      the Three Months Ended March 31, 1997
                      and 1996 (Unaudited)......................................3
  
                      Condensed Consolidated Statement of Cash
                      Flows for the Three Months Ended March 31, 1997
                      and 1996 (Unaudited)......................................4
  
                      Notes to Condensed Consolidated
                      Financial Statements (Unaudited)......................5 - 6
  
            Item 2.   Management's Discussion and Analysis
                      of Financial Condition and Results of
                      Operations............................................7 - 9
  
  PART II.  OTHER INFORMATION
  
            Item 1.   Legal Proceedings........................................10
  
            Item 6.   Exhibits and Reports on Form 8-K.........................10
  
            SIGNATURE .........................................................11
  
                         -----------------------------------
  
  This Quarterly  Report on Form 10-Q contains  forward  looking  statements  made
  pursuant to the "safe harbor"  provisions of the Private  Securities  Litigation
  Reform Act of 1995.  Readers are cautioned that such forward looking  statements
  involve  risks and  uncertainties  which  could  significantly  affect  expected
  results  in the  future  from  those  expressed  in  any  such  forward  looking
  statements  made by, or on behalf of the  Company.  Certain  factors  that could
  cause actual  results to differ  materially  include,  without  limitation,  the
  effects of  legislative  and  regulatory  changes;  the  potential for increased
  competition;  technological  changes; the need to generate substantial growth in
  the subscriber base by successfully launching,  marketing and providing services
  in  identified  markets;  pricing  pressures  which could affect  demand for the
  Company's services; the Company's ability to expand its distribution; changes in
  labor, programming, equipment and capital costs; the Company's continued ability
  to acquire programming that customers will find attractive; general business and
  economic conditions; and other risks detailed from time to time in the Company's
  periodic reports filed with the Securities and Exchange Commission.
  
  <PAGE>
                    STORER COMMUNICATIONS, INC. AND SUBSIDIARIES
                                      FORM 10-Q
                            QUARTER ENDED MARCH 31, 1997
  
  PART I.    FINANCIAL INFORMATION
  
  ITEM 1.    FINANCIAL STATEMENTS
  
                        CONDENSED CONSOLIDATED BALANCE SHEET
                                     (Unaudited)
  <TABLE>
  <CAPTION>
                                                                                      (Dollars in thousands, except share data)
                                                                                           March 31,        December 31,
                                                                                             1997               1996
  <S>                                                                                    <C>               <C>       
  ASSETS
  
     Cash and cash equivalents....................................................           $2,650            $1,435
     Accounts receivable, less allowance for
       doubtful accounts of $2,671 and $2,552.....................................           11,571            15,007
     Other current assets.........................................................            5,955             5,689
  
     Property and equipment.......................................................          662,701           643,540
       Accumulated depreciation...................................................         (293,823)         (285,206)
                                                                                         ----------        ----------
       Property and equipment, net................................................          368,878           358,334
                                                                                         ----------        ----------
  
     Deferred charges.............................................................        1,567,264         1,566,577
       Accumulated amortization ..................................................         (368,821)         (358,103)
                                                                                         ----------        ----------
       Deferred charges, net......................................................        1,198,443         1,208,474
                                                                                         ----------        ----------
  
     Due from affiliates..........................................................          345,023           304,853
     Investment...................................................................                             20,701
     Other assets.................................................................            4,144             4,426
                                                                                         ----------        ----------
  
                                                                                         $1,936,664        $1,918,919
                                                                                         ==========        ==========
  
  LIABILITIES AND STOCKHOLDER'S EQUITY
     Accounts payable and accrued expenses........................................          $60,963           $56,615
     Accrued interest.............................................................            5,231             1,748
     Other liabilities............................................................           20,464            20,766
     Debt.........................................................................          127,148           126,609
     Deferred income taxes........................................................          484,137           479,546
                                                                                         ----------        ----------
  
         Total liabilities........................................................          697,943           685,284
                                                                                         ----------        ----------
  
  
  COMMITMENTS AND CONTINGENCIES
  
  STOCKHOLDER'S EQUITY
     Common stock, $.01 par value - authorized, 10,000
       shares; issued and outstanding, 239.99 shares..............................
     Additional capital...........................................................        3,045,956         3,019,227
     Accumulated deficit..........................................................       (1,091,946)       (1,095,972)
     Unrealized loss on marketable securities.....................................                             (1,390)
     Finance Sub securities.......................................................         (715,289)         (688,230)
                                                                                         ----------        ----------
  
         Total stockholder's equity...............................................        1,238,721         1,233,635
                                                                                         ----------        ----------
  
                                                                                         $1,936,664        $1,918,919
                                                                                         ==========        ==========
  </TABLE>
  
  See notes to condensed consolidated financial statements.
  
                                          2
  
  
  <PAGE>
                    STORER COMMUNICATIONS, INC. AND SUBSIDIARIES
                                      FORM 10-Q
                            QUARTER ENDED MARCH 31, 1997
       CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND ACCUMULATED DEFICIT
                                     (Unaudited)
  <TABLE>
  <CAPTION>
                                                                                            (Dollars in thousands)
                                                                                          Three Months Ended March 31,
                                                                                             1997              1996
  
  <S>                                                                                   <C>               <C>         
  SERVICE INCOME..................................................................         $115,782          $103,880
                                                                                        -----------       ----------- 
  
  COSTS AND EXPENSES
     Operating....................................................................           53,070            46,164
     Selling, general and administrative..........................................           23,059            20,786
     Depreciation and amortization................................................           25,814            26,256
                                                                                        -----------       ----------- 
  
                                                                                            101,943            93,206
                                                                                        -----------       ----------- 
  
  OPERATING INCOME................................................................           13,839            10,674
  
  OTHER (INCOME) EXPENSE
     Interest expense.............................................................            4,176             4,189
     Investment loss (income), net................................................            1,500              (109)
                                                                                        -----------       ----------- 
  
                                                                                              5,676             4,080
                                                                                        -----------       ----------- 
  
  INCOME BEFORE INCOME TAX EXPENSE................................................            8,163             6,594
  
  INCOME TAX EXPENSE..............................................................            4,137             4,008
                                                                                        -----------       ----------- 
  
  NET INCOME......................................................................            4,026             2,586
  
  ACCUMULATED DEFICIT
  
     Beginning of period .........................................................       (1,095,972)       (1,128,642)
                                                                                        -----------       ----------- 
  
     End of period................................................................      ($1,091,946)      ($1,126,056)
                                                                                        ===========       =========== 
  </TABLE>
  
  
  
  See notes to condensed consolidated financial statements.
  
                                          3
  
  <PAGE>
  
                    STORER COMMUNICATIONS, INC. AND SUBSIDIARIES
                                      FORM 10-Q
                            QUARTER ENDED MARCH 31, 1997
                   CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
                                     (Unaudited)
  <TABLE>
  <CAPTION>
                                                                                              (Dollars in thousands)
                                                                                           Three Months Ended March 31,
                                                                                             1997             1996
  <S>                                                                                        <C>               <C>   
  OPERATING ACTIVITIES
     Net income...................................................................           $4,026            $2,586
     Adjustments to reconcile net income to
      net cash provided by operating activities:
       Depreciation and amortization..............................................           25,814            26,256
       Loss on sale of investment.................................................            1,657
       Non-cash interest expense..................................................              661               707
       Deferred income tax expense................................................            3,512             3,508
                                                                                            -------           ------- 
  
                                                                                             35,670            33,057
  
       Decrease in accounts receivable, other current assets
         and other assets.........................................................            3,452             2,617
       Increase (decrease) in accounts payable and accrued expenses,
         accrued interest and other liabilities...................................            7,407            (3,974)
                                                                                            -------           ------- 
  
             Net cash provided by operating activities............................           46,529            31,700
                                                                                            -------           ------- 
  
  FINANCING ACTIVITIES
     Net transactions with affiliates.............................................          (40,170)          (15,098)
                                                                                            -------           ------- 
  
             Net cash used in financing activities................................          (40,170)          (15,098)
                                                                                            -------           ------- 
  
  INVESTING ACTIVITIES
     Capital expenditures and other...............................................          (26,327)          (16,767)
     Proceeds from sale of investment.............................................           21,183
                                                                                            -------           ------- 
  
             Net cash used in investing activities................................           (5,144)          (16,767)
                                                                                            -------           ------- 
  
  INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS................................            1,215              (165)
  
  CASH AND CASH EQUIVALENTS, beginning of period..................................            1,435             1,386
                                                                                            -------           ------- 
  
  CASH AND CASH EQUIVALENTS, end of period........................................           $2,650            $1,221
                                                                                            =======           =======
  </TABLE>
  
  
  See notes to condensed consolidated financial statements.
  
  
                                          4
  <PAGE>
                    STORER COMMUNICATIONS, INC. AND SUBSIDIARIES
                                      FORM 10-Q
                            QUARTER ENDED MARCH 31, 1997
                NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                     (Unaudited)
  
  1.   CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
  
       Basis of Presentation
       The condensed  consolidated  balance sheet as of December 31, 1996 has been
       condensed  from the audited  balance  sheet as of that date.  The condensed
       consolidated  balance  sheet  as  of  March  31,  1997  and  the  condensed
       consolidated  statements of operations and accumulated  deficit and of cash
       flows for the three months ended March 31, 1997 and 1996 have been prepared
       by Storer Communications, Inc. (the "Company") and have not been audited by
       the  Company's  independent  auditors.  In the opinion of  management,  all
       adjustments (which include only normal recurring  adjustments) necessary to
       present fairly the financial position, results of operations and cash flows
       as of March 31, 1997 and for all periods presented have been made.
  
       Certain information and note disclosures normally included in the Company's
       annual financial  statements prepared in accordance with generally accepted
       accounting  principles  have been  condensed  or omitted.  These  condensed
       consolidated  financial  statements  should be read in conjunction with the
       financial  statements and notes thereto included in the Company's  December
       31, 1996 Annual Report on Form 10-K filed with the  Securities and Exchange
       Commission.  The results of operations  for the period ended March 31, 1997
       are not necessarily indicative of operating results for the full year.
  
  2.   INVESTMENT
  
       In October 1996, the Company received  552,014 shares of Time Warner,  Inc.
       ("Time  Warner")  common stock (the "Time Warner  Stock") in exchange  (the
       "Exchange")  for all of the  shares of  Turner  Broadcasting  System,  Inc.
       ("TBS")  stock  (the "TBS  Stock")  held by the  Company as a result of the
       merger of Time  Warner and TBS.  As a result of the  Exchange,  the Company
       recognized a pre-tax gain of $19.8  million in the fourth  quarter of 1996,
       representing the difference between the Company's  historical cost basis in
       the  TBS  Stock  of  $3.0  million  and the  new  basis  for the  Company's
       investment  in Time Warner Stock of $22.8  million,  which was based on the
       closing  price of the Time  Warner  Stock on the merger date of $41.375 per
       share. As of December 31, 1996, the shares of Time Warner Stock held by the
       Company were recorded at fair value of $20.7 million.  The unrealized  loss
       on this investment of $2.1 million was reported in the Company's  condensed
       consolidated  balance  sheet  as of  December  31,  1996 as a  decrease  in
       stockholder's  equity,  net of deferred income tax benefit of $0.7 million.
       In January  1997,  the Company sold its entire  interest in Time Warner for
       $21.2 million and recognized a pre-tax loss of $1.6 million.
  
  3.   RELATED PARTY TRANSACTIONS
  
       The  Company  receives  sales  commissions  from  QVC,  Inc.  ("QVC"),   an
       electronic  retailer  and a majority  owned and  controlled  subsidiary  of
       Comcast Corporation ("Comcast"),  the Company's indirect parent, based on a
       percentage  of QVC sales to the  Company's  subscribers.  In addition,  the
       Company  recognizes  revenues  relating  to the  carriage  of  certain  QVC
       programming.  For the  three  months  ended  March 31,  1997 and 1996,  the
       Company's  service  income  includes  $305,000 and $220,000,  respectively,
       relating to QVC.
  
       Comcast,  through a management  agreement,  manages the  operations  of the
       Company's  subsidiaries,  including  rebuilds and upgrades.  The management
       agreement generally provides that Comcast will supervise the management and
       operations  of the cable  systems and arrange  for and  supervise  (but not
       necessarily   perform  itself)   certain   administrative   functions.   As
       compensation  for such  services,  the  agreement  provides  for Comcast to
       charge  management  fees  of 6% of  gross  revenues.  Comcast  charged  the
       Company's  subsidiaries  management  fees of $6.9  million and $6.2 million
       during the three months ended March 31, 1997 and 1996, respectively.
  
                                          5
  
  <PAGE>
                    STORER COMMUNICATIONS, INC. AND SUBSIDIARIES
                                      FORM 10-Q
                            QUARTER ENDED MARCH 31, 1997
          NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONCLUDED
                                     (Unaudited)
  
       These management fees are included in selling,  general and  administrative
       expenses in the Company's  condensed  consolidated  statement of operations
       and accumulated deficit.
  
       On behalf of the Company,  Comcast  Storer,  Inc.  ("CSI"),  the  Company's
       parent and an  indirect  wholly  owned  subsidiary  of  Comcast,  seeks and
       secures,  through Comcast,  long-term  programming contracts that generally
       provide  for  payment  based on either a  monthly  fee per  subscriber  per
       channel or a percentage of certain subscriber revenues. CSI charges each of
       the  Company's  subsidiaries  for  programming  on a basis which  generally
       approximates  the  amount  each  such  subsidiary  would be  charged  if it
       purchased  directly  from  the  supplier  and  did  not  benefit  from  the
       purchasing power of Comcast's consolidated  operations.  Amounts charged to
       the Company by CSI for programming (the "Programming Charges") are included
       in operating expenses in the Company's condensed  consolidated statement of
       operations and accumulated  deficit.  The Company  purchases  certain other
       services,  including  insurance and employee  benefits,  from Comcast under
       cost-sharing  arrangements on terms that reflect Comcast's actual cost. The
       Company  reimburses  Comcast for certain other costs  (primarily  salaries)
       under cost-reimbursement arrangements. Under all of these arrangements, the
       Company  incurred  total  expenses  of $40.9  million  and  $35.2  million,
       including  $36.3 million and $31.0 million of Programming  Charges,  during
       the three months ended March 31, 1997 and 1996, respectively. 
  
       Due from affiliates in the Company's condensed  consolidated  balance sheet
       primarily  consists  of  cash  transfers  to CSI  under  a cash  management
       program,  net of  expenses  charged  under  the  cost-sharing  arrangements
       described  above and  amounts  payable to  Comcast  and its  affiliates  as
       reimbursement  for payments  made, in the ordinary  course of business,  by
       such affiliates on behalf of the Company.
  
  4.   STATEMENT OF CASH FLOWS - SUPPLEMENTAL INFORMATION
  
       The Company recognized non-cash dividends on the preferred stock of Comcast
       Storer  Finance  Sub,  Inc.,  a wholly  owned  subsidiary  of CSI, of $26.1
       million and $22.3 million  during the three months ended March 31, 1997 and
       1996, respectively.  The preferred stock dividends recognized were credited
       to  additional  capital in the  Company's  condensed  consolidated  balance
       sheet.
  
  5.   CONTINGENCIES
  
       The Company is subject to claims which arise in the ordinary  course of its
       business and other legal  proceedings.  In the opinion of  management,  the
       amount  of  ultimate  liability  with  respect  to these  actions  will not
       materially  affect  the  financial  position,   results  of  operations  or
       liquidity of the Company.
  
       The Company  currently is seeking to justify rates for basic cable services
       and equipment in its cable systems in the State of Connecticut on the basis
       of a  cost-of-service  showing.  The State of  Connecticut  has ordered the
       Company  to reduce  such  rates and to make  refunds  to  subscribers.  The
       Company has appealed the Connecticut decision to the Federal Communications
       Commission  ("FCC").  Recent  pronouncements  from the FCC, which generally
       support  the  Company's  position  on  appeal,  have  caused  the  State of
       Connecticut to reexamine its prior ruling. While the Company cannot predict
       the  outcome  of this  action,  the  Company  believes  that  the  ultimate
       resolution  of this  pending  regulatory  matter  will not have a  material
       adverse impact on the Company's financial  position,  results of operations
       or liquidity.
  
                                          6
  <PAGE>
                    STORER COMMUNICATIONS, INC. AND SUBSIDIARIES
                                      FORM 10-Q
                            QUARTER ENDED MARCH 31, 1997
  
  
  
  ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND 
            RESULTS OF OPERATIONS
  
  Liquidity and Capital Resources
  
  The Company's  business is capital  intensive and continually  requires cash for
  development  and  expansion.  The  Company has  historically  met its cash needs
  through its cash and cash equivalents,  cash flows from operating  activities as
  well as interest and principal  received on certain securities issued by Comcast
  Storer  Finance  Sub,  Inc.,  an indirect  wholly  owned  subsidiary  of Comcast
  Corporation  ("Comcast"),  the Company's  indirect  parent,  to the Company (the
  "Finance Sub Securities").
  
  In October 1996, the Company received 552,014 shares of Time Warner, Inc. ("Time
  Warner") common stock (the "Time Warner Stock") in exchange (the "Exchange") for
  all of the shares of Turner  Broadcasting  System,  Inc. ("TBS") stock (the "TBS
  Stock") held by the Company as a result of the merger of Time Warner and TBS. As
  a result of the Exchange, the Company recognized a pre-tax gain of $19.8 million
  in the fourth quarter of 1996, representing the difference between the Company's
  historical cost basis in the TBS Stock of $3.0 million and the new basis for the
  Company's  investment in Time Warner Stock of $22.8 million,  which was based on
  the  closing  price of the Time  Warner  Stock on the merger date of $41.375 per
  share.  As of December  31,  1996,  the shares of Time Warner  Stock held by the
  Company were recorded at fair value of $20.7  million.  The  unrealized  loss on
  this  investment  of  $2.1  million  was  reported  in the  Company's  condensed
  consolidated   balance   sheet  as  of  December  31,  1996  as  a  decrease  in
  stockholder's  equity,  net of deferred  income tax benefit of $0.7 million.  In
  January  1997,  the  Company  sold its entire  interest in Time Warner for $21.2
  million and recognized a pre-tax loss of $1.6 million.
  
  The Company  believes  that it will be able to meet its  current  and  long-term
  liquidity needs and capital requirements,  including fixed charges,  through its
  cash  flows  from  operating  activities,  existing  cash and cash  equivalents,
  interest and principal received on the Finance Sub Securities,  amounts due from
  affiliates and other external financing.
  
  Results of Operations
  
  Summarized  consolidated  financial  information  for the  Company for the three
  months ended March 31, 1997 and 1996 is as follows  (dollars in  millions,  "NM"
  denotes percentage is not meaningful):
  
  <TABLE>
  <CAPTION>
                                                                     Three Months Ended
                                                                          March 31,           Increase/(Decrease)
                                                                     1997         1996           $            %
  <S>                                                                <C>          <C>           <C>          <C>  
  Service income............................................         $115.8       $103.9        $11.9        11.5%
  Operating, selling, general and administrative
     expenses...............................................           76.1         67.0          9.1        13.6
                                                                     ------       ------
  
  Operating income before depreciation and
     amortization (1) ......................................           39.7         36.9          2.8         7.6
  Depreciation and amortization.............................           25.9         26.2         (0.3)       (1.1)
                                                                     ------       ------
  
  Operating income..........................................           13.8         10.7          3.1        29.0
                                                                     ------       ------
  
  Interest expense..........................................            4.2          4.2
  Investment loss (income), net.............................            1.5         (0.1)         1.6          NM
  Income tax expense........................................            4.1          4.0          0.1         2.5
                                                                     ------       ------
  
  Net income................................................           $4.0         $2.6         $1.4        53.8%
                                                                     ======       ======
  </TABLE>
  
  ------------
  
                                          7
  <PAGE>
                    STORER COMMUNICATIONS, INC. AND SUBSIDIARIES
                                      FORM 10-Q
                            QUARTER ENDED MARCH 31, 1997
  
  
  (1)  Operating income before  depreciation and amortization is commonly referred
       to in the Company's  business as "operating cash flow." Operating cash flow
       is a measure  of a  company's  ability  to  generate  cash to  service  its
       obligations, including debt service obligations, and to finance capital and
       other  expenditures.  In part due to the  capital  intensive  nature of the
       Company's  business  and  the  resulting   significant  level  of  non-cash
       depreciation  and amortization  expense,  operating cash flow is frequently
       used  as  one  of the  bases  for  comparing  businesses  in the  Company's
       industry.  Operating  cash flow does not purport to represent net income or
       net cash provided by operating activities, as those terms are defined under
       generally accepted accounting  principles,  and should not be considered as
       an  alternative  to such  measurements  as an  indicator  of the  Company's
       performance.
  
  Of the $11.9 million  increase in service income for the three month period from
  1996 to 1997, $1.8 million is attributable  to subscriber  growth,  $9.4 million
  relates to an increase in rates and $700,000  relates to growth in other product
  offerings.
  
  The Company  receives sales  commissions from QVC, Inc.  ("QVC"),  an electronic
  retailer and a majority owned and controlled  subsidiary of Comcast,  based on a
  percentage of QVC sales to the Company's  subscribers.  In addition, the Company
  recognizes revenues relating to the carriage of certain QVC programming. For the
  three  months  ended  March 31,  1997 and 1996,  the  Company's  service  income
  includes $305,000 and $220,000, respectively, relating to QVC.
  
  Of the $9.1 million increase in operating,  selling,  general and administrative
  expenses  for the  three  month  period  from  1996 to  1997,  $5.3  million  is
  attributable  to an  increase  in the cost of cable  programming  as a result of
  subscriber  growth,  additional  programming  offerings and changes in rates and
  $3.8  million  results  from an increase  in the cost of labor and other  volume
  related expenses.  Comcast charged the Company's subsidiaries management fees of
  $6.9 million and $6.2  million  during the three months ended March 31, 1997 and
  1996,  respectively.  These management fees are included in selling, general and
  administrative  expenses in the Company's  condensed  consolidated  statement of
  operations and accumulated deficit.
  
  On behalf of the Company, Comcast Storer, Inc. ("CSI"), the Company's parent and
  an indirect  wholly owned  subsidiary  of Comcast,  seeks and  secures,  through
  Comcast,  long-term  programming  contracts that  generally  provide for payment
  based on either a monthly  fee per  subscriber  per channel or a  percentage  of
  certain subscriber revenues.  CSI charges each of the Company's subsidiaries for
  programming  on a basis  which  generally  approximates  the  amount  each  such
  subsidiary  would be charged if it purchased  directly from the supplier and did
  not benefit  from the  purchasing  power of Comcast's  consolidated  operations.
  Amounts  charged  to  the  Company  by CSI  for  programming  (the  "Programming
  Charges")  are  included  in  operating  expenses  in  the  Company's  condensed
  consolidated  statement  of  operations  and  accumulated  deficit.  The Company
  purchases  certain other services,  including  insurance and employee  benefits,
  from Comcast under  cost-sharing  arrangements  on terms that reflect  Comcast's
  actual cost. The Company  reimburses  Comcast for certain other costs (primarily
  salaries)   under   cost-reimbursement   arrangements.   Under   all  of   these
  arrangements,  the Company  incurred  total  expenses of $40.9 million and $35.2
  million,  including  $36.3  million and $31.0  million of  Programming  Charges,
  during the three  months  ended  March 31,  1997 and 1996,  respectively.  It is
  anticipated  that the Company's cost of cable  programming  will increase in the
  future as cable  programming  rates  increase  and  additional  sources of cable
  programming become available.
  
  The $300,000  decrease in depreciation  and  amortization  expense for the three
  month period from 1996 to 1997 is primarily  due to the timing and extent of the
  rebuild and upgrade of the Company's cable plant.
  
  
                                          8
  <PAGE>
                    STORER COMMUNICATIONS, INC. AND SUBSIDIARIES
                                      FORM 10-Q
                            QUARTER ENDED MARCH 31, 1997
  
  
  
  The $1.6 million  increase in net  investment  loss (income) for the three month
  period from 1996 to 1997 is primarily attributable to the loss recognized on the
  sale of the Time Warner Stock.
  
  The $100,000 increase in income tax expense for the three month period from 1996
  to 1997 is primarily  attributable  to the increase in income  before income tax
  expense.
  
  For the three  months  ended March 31,  1997 and 1996,  the  Company's  earnings
  before income tax expense and fixed charges (interest  expense) of $12.3 million
  and $10.8 million,  respectively,  exceeded its fixed charges of $4.2 million in
  each period.
  
  The  Company  believes  that  its  operations  are not  materially  affected  by
  inflation.
  
  Regulatory Developments
  
  The Company  currently is seeking to justify rates for basic cable  services and
  equipment  in its cable  systems in the State of  Connecticut  on the basis of a
  cost-of-service  showing.  The State of  Connecticut  has ordered the Company to
  reduce such rates and to make refunds to  subscribers.  The Company has appealed
  the  Connecticut  decision to the  Federal  Communications  Commission  ("FCC").
  Recent  pronouncements  from the FCC,  which  generally  support  the  Company's
  position on appeal,  have caused the State of Connecticut to reexamine its prior
  ruling. While the Company cannot predict the outcome of this action, the Company
  believes that the ultimate resolution of this pending regulatory matter will not
  have a material adverse impact on the Company's financial  position,  results of
  operations or liquidity.
  
  
                                          9
  <PAGE>
  
                    STORER COMMUNICATIONS, INC. AND SUBSIDIARIES
                                      FORM 10-Q
                            QUARTER ENDED MARCH 31, 1997
  
  
  
  PART II.  OTHER INFORMATION
  
  ITEM 1.   Legal Proceedings
  
       The  Company  is not  party to  litigation  which,  in the  opinion  of the
       Company's management,  will have a material adverse effect on the Company's
       financial position, results of operations or liquidity.
  
  ITEM 6.   Exhibits and Reports on Form 8-K
  
       (a)  Exhibits required to be filed by Item 601 of Regulation S-K:
  
            27.1    Financial Data Schedule.
  
       (b)  Reports on Form 8-K - None.
  
  
  
                                         10
  
  <PAGE>
  
                    STORER COMMUNICATIONS, INC. AND SUBSIDIARIES
                                      FORM 10-Q
                            QUARTER ENDED MARCH 31, 1997
  
  
                                      SIGNATURE
  
           Pursuant to the  requirements  of the  Securities  and  Exchange Act of
  1934,  the  Registrant has duly caused this report to be signed on its behalf by
  the undersigned thereunto duly authorized.
  
  
                                      STORER COMMUNICATIONS, INC.
                                      ------------------------------------------
  
  
  
  
  
                                      /s/ Lawrence S. Smith
                                      ------------------------------------------
                                      Lawrence S. Smith
                                      Senior Vice President
                                      Accounting and Administration
                                      (Principal Financial and Accounting Officer)
  
  
  Date: May 14, 1997
  
                                         11
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text: UNITED STATES
                         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:
                                   MARCH 31, 1997
                                         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 1-3872
  
                             STORER COMMUNICATIONS, INC.
               (Exact name of registrant as specified in its charter)
  
                  DELAWARE                                      59-2638096
  --------------------------------------------------------------------------------
           (State or other jurisdiction of                   (I.R.S. Employer
           incorporation or organization)                    Identification No.)
  
                   1500 Market Street, Philadelphia, PA 19102-2148
  --------------------------------------------------------------------------------
                      (Address of principal executive offices)
                                     (Zip Code)
  
  Registrant's telephone number, including area code:  (215) 665-1700
  
                             --------------------------
  
  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  twelve months (or for such shorter period that the registrant was
  required to file such  reports),  and (2) has been subject to such  requirements
  for the past 90 days.
  
           Yes  _X_                                           No ___
  
                             --------------------------
  
  As of March 31, 1997, there were 239.99 shares of Common Stock outstanding.
  
  The Registrant  meets the conditions set forth in General  Instructions H (1)(a)
  and (b) of Form  10-Q  and is  therefore  filing  this  form  with  the  reduced
  disclosure format.
  STORER COMMUNICATIONS, INC. AND SUBSIDIARIES
                                      FORM 10-Q
                            QUARTER ENDED MARCH 31, 1997
  
                                  TABLE OF CONTENTS
  
                                                                            Page
                                                                           Number
  PART I.   FINANCIAL INFORMATION
  
            Item 1.   Financial Statements
  
                      Condensed Consolidated Balance Sheet
                      as of March 31, 1997 and December 31,
                      1996 (Unaudited)..........................................2
  
                      Condensed Consolidated Statement of
                      Operations and Accumulated Deficit for
                      the Three Months Ended March 31, 1997
                      and 1996 (Unaudited)......................................3
  
                      Condensed Consolidated Statement of Cash
                      Flows for the Three Months Ended March 31, 1997
                      and 1996 (Unaudited)......................................4
  
                      Notes to Condensed Consolidated
                      Financial Statements (Unaudited)......................5 - 6
  
            Item 2.   Management's Discussion and Analysis
                      of Financial Condition and Results of
                      Operations............................................7 - 9
  
  PART II.  OTHER INFORMATION
  
            Item 1.   Legal Proceedings........................................10
  
            Item 6.   Exhibits and Reports on Form 8-K.........................10
  
            SIGNATURE .........................................................11
  
                         -----------------------------------
  
  This Quarterly  Report on Form 10-Q contains  forward  looking  statements  made
  pursuant to the "safe harbor"  provisions of the Private  Securities  Litigation
  Reform Act of 1995.  Readers are cautioned that such forward looking  statements
  involve  risks and  uncertainties  which  could  significantly  affect  expected
  results  in the  future  from  those  expressed  in  any  such  forward  looking
  statements  made by, or on behalf of the  Company.  Certain  factors  that could
  cause actual  results to differ  materially  include,  without  limitation,  the
  effects of  legislative  and  regulatory  changes;  the  potential for increased
  competition;  technological  changes; the need to generate substantial growth in
  the subscriber base by successfully launching,  marketing and providing services
  in  identified  markets;  pricing  pressures  which could affect  demand for the
  Company's services; the Company's ability to expand its distribution; changes in
  labor, programming, equipment and capital costs; the Company's continued ability
  to acquire programming that customers will find attractive; general business and
  economic conditions; and other risks detailed from time to time in the Company's
  periodic reports filed with the Securities and Exchange Commission.
  STORER COMMUNICATIONS, INC. AND SUBSIDIARIES
                                      FORM 10-Q
                            QUARTER ENDED MARCH 31, 1997
  
  PART I.    FINANCIAL INFORMATION
  
  ITEM 1.    FINANCIAL STATEMENTS
  
                        CONDENSED CONSOLIDATED BALANCE SHEET
                                     (Unaudited)
  (Dollars in thousands, except share data)
                                                                                           March 31,        December 31,
                                                                                             1997               1996
  ASSETS
  
     Cash and cash equivalents....................................................           $2,650            $1,435
     Accounts receivable, less allowance for
       doubtful accounts of $2,671 and $2,552.....................................           11,571            15,007
     Other current assets.........................................................            5,955             5,689
  
     Property and equipment.......................................................          662,701           643,540
       Accumulated depreciation...................................................         (293,823)         (285,206)
                                                                                         ----------        ----------
       Property and equipment, net................................................          368,878           358,334
                                                                                         ----------        ----------
  
     Deferred charges.............................................................        1,567,264         1,566,577
       Accumulated amortization ..................................................         (368,821)         (358,103)
                                                                                         ----------        ----------
       Deferred charges, net......................................................        1,198,443         1,208,474
                                                                                         ----------        ----------
  
     Due from affiliates..........................................................          345,023           304,853
     Investment...................................................................                             20,701
     Other assets.................................................................            4,144             4,426
                                                                                         ----------        ----------
  
                                                                                         $1,936,664        $1,918,919
                                                                                         ==========        ==========
  
  LIABILITIES AND STOCKHOLDER'S EQUITY
     Accounts payable and accrued expenses........................................          $60,963           $56,615
     Accrued interest.............................................................            5,231             1,748
     Other liabilities............................................................           20,464            20,766
     Debt.........................................................................          127,148           126,609
     Deferred income taxes........................................................          484,137           479,546
                                                                                         ----------        ----------
  
         Total liabilities........................................................          697,943           685,284
                                                                                         ----------        ----------
  
  COMMITMENTS AND CONTINGENCIES
  
  STOCKHOLDER'S EQUITY
     Common stock, $.01 par value - authorized, 10,000
       shares; issued and outstanding, 239.99 shares..............................
     Additional capital...........................................................        3,045,956         3,019,227
     Accumulated deficit..........................................................       (1,091,946)       (1,095,972)
     Unrealized loss on marketable securities.....................................                             (1,390)
     Finance Sub securities.......................................................         (715,289)         (688,230)
                                                                                         ----------        ----------
  
         Total stockholder's equity...............................................        1,238,721         1,233,635
                                                                                         ----------        ----------
  
                                                                                         $1,936,664        $1,918,919
                                                                                         ==========        ==========
  See notes to condensed consolidated financial statements.
  
                                          2
  STORER COMMUNICATIONS, INC. AND SUBSIDIARIES
                                      FORM 10-Q
                            QUARTER ENDED MARCH 31, 1997
       CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND ACCUMULATED DEFICIT
                                     (Unaudited)
  (Dollars in thousands)
                                                                                          Three Months Ended March 31,
                                                                                             1997              1996
  SERVICE INCOME..................................................................         $115,782          $103,880
                                                                                        -----------       ----------- 
  
  COSTS AND EXPENSES
     Operating....................................................................           53,070            46,164
     Selling, general and administrative..........................................           23,059            20,786
     Depreciation and amortization................................................           25,814            26,256
                                                                                        -----------       ----------- 
  
                                                                                            101,943            93,206
                                                                                        -----------       ----------- 
  
  OPERATING INCOME................................................................           13,839            10,674
  
  OTHER (INCOME) EXPENSE
     Interest expense.............................................................            4,176             4,189
     Investment loss (income), net................................................            1,500              (109)
                                                                                        -----------       ----------- 
  
                                                                                              5,676             4,080
                                                                                        -----------       ----------- 
  
  INCOME BEFORE INCOME TAX EXPENSE................................................            8,163             6,594
  
  INCOME TAX EXPENSE..............................................................            4,137             4,008
                                                                                        -----------       ----------- 
  
  NET INCOME......................................................................            4,026             2,586
  
  ACCUMULATED DEFICIT
  
     Beginning of period .........................................................       (1,095,972)       (1,128,642)
                                                                                        -----------       ----------- 
  
     End of period................................................................      ($1,091,946)      ($1,126,056)
                                                                                        ===========       ===========
  See notes to condensed consolidated financial statements.
  
                                          3
  STORER COMMUNICATIONS, INC. AND SUBSIDIARIES
                                      FORM 10-Q
                            QUARTER ENDED MARCH 31, 1997
                   CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
                                     (Unaudited)
  (Dollars in thousands)
                                                                                           Three Months Ended March 31,
                                                                                             1997             1996
  OPERATING ACTIVITIES
     Net income...................................................................           $4,026            $2,586
     Adjustments to reconcile net income to
      net cash provided by operating activities:
       Depreciation and amortization..............................................           25,814            26,256
       Loss on sale of investment.................................................            1,657
       Non-cash interest expense..................................................              661               707
       Deferred income tax expense................................................            3,512             3,508
                                                                                            -------           ------- 
  
                                                                                             35,670            33,057
  
       Decrease in accounts receivable, other current assets
         and other assets.........................................................            3,452             2,617
       Increase (decrease) in accounts payable and accrued expenses,
         accrued interest and other liabilities...................................            7,407            (3,974)
                                                                                            -------           ------- 
  
             Net cash provided by operating activities............................           46,529            31,700
                                                                                            -------           ------- 
  
  FINANCING ACTIVITIES
     Net transactions with affiliates.............................................          (40,170)          (15,098)
                                                                                            -------           ------- 
  
             Net cash used in financing activities................................          (40,170)          (15,098)
                                                                                            -------           ------- 
  
  INVESTING ACTIVITIES
     Capital expenditures and other...............................................          (26,327)          (16,767)
     Proceeds from sale of investment.............................................           21,183
                                                                                            -------           ------- 
  
             Net cash used in investing activities................................           (5,144)          (16,767)
                                                                                            -------           ------- 
  
  INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS................................            1,215              (165)
  
  CASH AND CASH EQUIVALENTS, beginning of period..................................            1,435             1,386
                                                                                            -------           ------- 
  
  CASH AND CASH EQUIVALENTS, end of period........................................           $2,650            $1,221
                                                                                            =======           =======
  See notes to condensed consolidated financial statements.
  
                                          4
  STORER COMMUNICATIONS, INC. AND SUBSIDIARIES
                                      FORM 10-Q
                            QUARTER ENDED MARCH 31, 1997
                NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                     (Unaudited)
  
  1.   CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
  
       Basis of Presentation
       The condensed  consolidated  balance sheet as of December 31, 1996 has been
       condensed  from the audited  balance  sheet as of that date.  The condensed
       consolidated  balance  sheet  as  of  March  31,  1997  and  the  condensed
       consolidated  statements of operations and accumulated  deficit and of cash
       flows for the three months ended March 31, 1997 and 1996 have been prepared
       by Storer Communications, Inc. (the "Company") and have not been audited by
       the  Company's  independent  auditors.  In the opinion of  management,  all
       adjustments (which include only normal recurring  adjustments) necessary to
       present fairly the financial position, results of operations and cash flows
       as of March 31, 1997 and for all periods presented have been made.
  
       Certain information and note disclosures normally included in the Company's
       annual financial  statements prepared in accordance with generally accepted
       accounting  principles  have been  condensed  or omitted.  These  condensed
       consolidated  financial  statements  should be read in conjunction with the
       financial  statements and notes thereto included in the Company's  December
       31, 1996 Annual Report on Form 10-K filed with the  Securities and Exchange
       Commission.  The results of operations  for the period ended March 31, 1997
       are not necessarily indicative of operating results for the full year.
  
  2.   INVESTMENT
  
       In October 1996, the Company received  552,014 shares of Time Warner,  Inc.
       ("Time  Warner")  common stock (the "Time Warner  Stock") in exchange  (the
       "Exchange")  for all of the  shares of  Turner  Broadcasting  System,  Inc.
       ("TBS")  stock  (the "TBS  Stock")  held by the  Company as a result of the
       merger of Time  Warner and TBS.  As a result of the  Exchange,  the Company
       recognized a pre-tax gain of $19.8  million in the fourth  quarter of 1996,
       representing the difference between the Company's  historical cost basis in
       the  TBS  Stock  of  $3.0  million  and the  new  basis  for the  Company's
       investment  in Time Warner Stock of $22.8  million,  which was based on the
       closing  price of the Time  Warner  Stock on the merger date of $41.375 per
       share. As of December 31, 1996, the shares of Time Warner Stock held by the
       Company were recorded at fair value of $20.7 million.  The unrealized  loss
       on this investment of $2.1 million was reported in the Company's  condensed
       consolidated  balance  sheet  as of  December  31,  1996 as a  decrease  in
       stockholder's  equity,  net of deferred income tax benefit of $0.7 million.
       In January  1997,  the Company sold its entire  interest in Time Warner for
       $21.2 million and recognized a pre-tax loss of $1.6 million.
  
  3.   RELATED PARTY TRANSACTIONS
  
       The  Company  receives  sales  commissions  from  QVC,  Inc.  ("QVC"),   an
       electronic  retailer  and a majority  owned and  controlled  subsidiary  of
       Comcast Corporation ("Comcast"),  the Company's indirect parent, based on a
       percentage  of QVC sales to the  Company's  subscribers.  In addition,  the
       Company  recognizes  revenues  relating  to the  carriage  of  certain  QVC
       programming.  For the  three  months  ended  March 31,  1997 and 1996,  the
       Company's  service  income  includes  $305,000 and $220,000,  respectively,
       relating to QVC.
  
       Comcast,  through a management  agreement,  manages the  operations  of the
       Company's  subsidiaries,  including  rebuilds and upgrades.  The management
       agreement generally provides that Comcast will supervise the management and
       operations  of the cable  systems and arrange  for and  supervise  (but not
       necessarily   perform  itself)   certain   administrative   functions.   As
       compensation  for such  services,  the  agreement  provides  for Comcast to
       charge  management  fees  of 6% of  gross  revenues.  Comcast  charged  the
       Company's  subsidiaries  management  fees of $6.9  million and $6.2 million
       during the three months ended March 31, 1997 and 1996, respectively.
  
                                          5
  STORER COMMUNICATIONS, INC. AND SUBSIDIARIES
                                      FORM 10-Q
                            QUARTER ENDED MARCH 31, 1997
          NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONCLUDED
                                     (Unaudited)
  
       These management fees are included in selling,  general and  administrative
       expenses in the Company's  condensed  consolidated  statement of operations
       and accumulated deficit.
  
       On behalf of the Company,  Comcast  Storer,  Inc.  ("CSI"),  the  Company's
       parent and an  indirect  wholly  owned  subsidiary  of  Comcast,  seeks and
       secures,  through Comcast,  long-term  programming contracts that generally
       provide  for  payment  based on either a  monthly  fee per  subscriber  per
       channel or a percentage of certain subscriber revenues. CSI charges each of
       the  Company's  subsidiaries  for  programming  on a basis which  generally
       approximates  the  amount  each  such  subsidiary  would be  charged  if it
       purchased  directly  from  the  supplier  and  did  not  benefit  from  the
       purchasing power of Comcast's consolidated  operations.  Amounts charged to
       the Company by CSI for programming (the "Programming Charges") are included
       in operating expenses in the Company's condensed  consolidated statement of
       operations and accumulated  deficit.  The Company  purchases  certain other
       services,  including  insurance and employee  benefits,  from Comcast under
       cost-sharing  arrangements on terms that reflect Comcast's actual cost. The
       Company  reimburses  Comcast for certain other costs  (primarily  salaries)
       under cost-reimbursement arrangements. Under all of these arrangements, the
       Company  incurred  total  expenses  of $40.9  million  and  $35.2  million,
       including  $36.3 million and $31.0 million of Programming  Charges,  during
       the three months ended March 31, 1997 and 1996, respectively. 
  
       Due from affiliates in the Company's condensed  consolidated  balance sheet
       primarily  consists  of  cash  transfers  to CSI  under  a cash  management
       program,  net of  expenses  charged  under  the  cost-sharing  arrangements
       described  above and  amounts  payable to  Comcast  and its  affiliates  as
       reimbursement  for payments  made, in the ordinary  course of business,  by
       such affiliates on behalf of the Company.
  
  4.   STATEMENT OF CASH FLOWS - SUPPLEMENTAL INFORMATION
  
       The Company recognized non-cash dividends on the preferred stock of Comcast
       Storer  Finance  Sub,  Inc.,  a wholly  owned  subsidiary  of CSI, of $26.1
       million and $22.3 million  during the three months ended March 31, 1997 and
       1996, respectively.  The preferred stock dividends recognized were credited
       to  additional  capital in the  Company's  condensed  consolidated  balance
       sheet.
  
  5.   CONTINGENCIES
  
       The Company is subject to claims which arise in the ordinary  course of its
       business and other legal  proceedings.  In the opinion of  management,  the
       amount  of  ultimate  liability  with  respect  to these  actions  will not
       materially  affect  the  financial  position,   results  of  operations  or
       liquidity of the Company.
  
       The Company  currently is seeking to justify rates for basic cable services
       and equipment in its cable systems in the State of Connecticut on the basis
       of a  cost-of-service  showing.  The State of  Connecticut  has ordered the
       Company  to reduce  such  rates and to make  refunds  to  subscribers.  The
       Company has appealed the Connecticut decision to the Federal Communications
       Commission  ("FCC").  Recent  pronouncements  from the FCC, which generally
       support  the  Company's  position  on  appeal,  have  caused  the  State of
       Connecticut to reexamine its prior ruling. While the Company cannot predict
       the  outcome  of this  action,  the  Company  believes  that  the  ultimate
       resolution  of this  pending  regulatory  matter  will not have a  material
       adverse impact on the Company's financial  position,  results of operations
       or liquidity.
  
                                          6
  STORER COMMUNICATIONS, INC. AND SUBSIDIARIES
                                      FORM 10-Q
                            QUARTER ENDED MARCH 31, 1997
  
  ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND 
            RESULTS OF OPERATIONS
  
  Liquidity and Capital Resources
  
  The Company's  business is capital  intensive and continually  requires cash for
  development  and  expansion.  The  Company has  historically  met its cash needs
  through its cash and cash equivalents,  cash flows from operating  activities as
  well as interest and principal  received on certain securities issued by Comcast
  Storer  Finance  Sub,  Inc.,  an indirect  wholly  owned  subsidiary  of Comcast
  Corporation  ("Comcast"),  the Company's  indirect  parent,  to the Company (the
  "Finance Sub Securities").
  
  In October 1996, the Company received 552,014 shares of Time Warner, Inc. ("Time
  Warner") common stock (the "Time Warner Stock") in exchange (the "Exchange") for
  all of the shares of Turner  Broadcasting  System,  Inc. ("TBS") stock (the "TBS
  Stock") held by the Company as a result of the merger of Time Warner and TBS. As
  a result of the Exchange, the Company recognized a pre-tax gain of $19.8 million
  in the fourth quarter of 1996, representing the difference between the Company's
  historical cost basis in the TBS Stock of $3.0 million and the new basis for the
  Company's  investment in Time Warner Stock of $22.8 million,  which was based on
  the  closing  price of the Time  Warner  Stock on the merger date of $41.375 per
  share.  As of December  31,  1996,  the shares of Time Warner  Stock held by the
  Company were recorded at fair value of $20.7  million.  The  unrealized  loss on
  this  investment  of  $2.1  million  was  reported  in the  Company's  condensed
  consolidated   balance   sheet  as  of  December  31,  1996  as  a  decrease  in
  stockholder's  equity,  net of deferred  income tax benefit of $0.7 million.  In
  January  1997,  the  Company  sold its entire  interest in Time Warner for $21.2
  million and recognized a pre-tax loss of $1.6 million.
  
  The Company  believes  that it will be able to meet its  current  and  long-term
  liquidity needs and capital requirements,  including fixed charges,  through its
  cash  flows  from  operating  activities,  existing  cash and cash  equivalents,
  interest and principal received on the Finance Sub Securities,  amounts due from
  affiliates and other external financing.
  
  Results of Operations
  
  Summarized  consolidated  financial  information  for the  Company for the three
  months ended March 31, 1997 and 1996 is as follows  (dollars in  millions,  "NM"
  denotes percentage is not meaningful):
  Three Months Ended
                                                                          March 31,           Increase/(Decrease)
                                                                     1997         1996           $            %
  Service income............................................         $115.8       $103.9        $11.9        11.5%
  Operating, selling, general and administrative
     expenses...............................................           76.1         67.0          9.1        13.6
                                                                     ------       ------
  
  Operating income before depreciation and
     amortization (1) ......................................           39.7         36.9          2.8         7.6
  Depreciation and amortization.............................           25.9         26.2         (0.3)       (1.1)
                                                                     ------       ------
  
  Operating income..........................................           13.8         10.7          3.1        29.0
                                                                     ------       ------
  
  Interest expense..........................................            4.2          4.2
  Investment loss (income), net.............................            1.5         (0.1)         1.6          NM
  Income tax expense........................................            4.1          4.0          0.1         2.5
                                                                     ------       ------
  
  Net income................................................           $4.0         $2.6         $1.4        53.8%
                                                                     ======       ======
  ------------
  
                                          7
  STORER COMMUNICATIONS, INC. AND SUBSIDIARIES
                                      FORM 10-Q
                            QUARTER ENDED MARCH 31, 1997
  
  (1)  Operating income before  depreciation and amortization is commonly referred
       to in the Company's  business as "operating cash flow." Operating cash flow
       is a measure  of a  company's  ability  to  generate  cash to  service  its
       obligations, including debt service obligations, and to finance capital and
       other  expenditures.  In part due to the  capital  intensive  nature of the
       Company's  business  and  the  resulting   significant  level  of  non-cash
       depreciation  and amortization  expense,  operating cash flow is frequently
       used  as  one  of the  bases  for  comparing  businesses  in the  Company's
       industry.  Operating  cash flow does not purport to represent net income or
       net cash provided by operating activities, as those terms are defined under
       generally accepted accounting  principles,  and should not be considered as
       an  alternative  to such  measurements  as an  indicator  of the  Company's
       performance.
  
  Of the $11.9 million  increase in service income for the three month period from
  1996 to 1997, $1.8 million is attributable  to subscriber  growth,  $9.4 million
  relates to an increase in rates and $700,000  relates to growth in other product
  offerings.
  
  The Company  receives sales  commissions from QVC, Inc.  ("QVC"),  an electronic
  retailer and a majority owned and controlled  subsidiary of Comcast,  based on a
  percentage of QVC sales to the Company's  subscribers.  In addition, the Company
  recognizes revenues relating to the carriage of certain QVC programming. For the
  three  months  ended  March 31,  1997 and 1996,  the  Company's  service  income
  includes $305,000 and $220,000, respectively, relating to QVC.
  
  Of the $9.1 million increase in operating,  selling,  general and administrative
  expenses  for the  three  month  period  from  1996 to  1997,  $5.3  million  is
  attributable  to an  increase  in the cost of cable  programming  as a result of
  subscriber  growth,  additional  programming  offerings and changes in rates and
  $3.8  million  results  from an increase  in the cost of labor and other  volume
  related expenses.  Comcast charged the Company's subsidiaries management fees of
  $6.9 million and $6.2  million  during the three months ended March 31, 1997 and
  1996,  respectively.  These management fees are included in selling, general and
  administrative  expenses in the Company's  condensed  consolidated  statement of
  operations and accumulated deficit.
  
  On behalf of the Company, Comcast Storer, Inc. ("CSI"), the Company's parent and
  an indirect  wholly owned  subsidiary  of Comcast,  seeks and  secures,  through
  Comcast,  long-term  programming  contracts that  generally  provide for payment
  based on either a monthly  fee per  subscriber  per channel or a  percentage  of
  certain subscriber revenues.  CSI charges each of the Company's subsidiaries for
  programming  on a basis  which  generally  approximates  the  amount  each  such
  subsidiary  would be charged if it purchased  directly from the supplier and did
  not benefit  from the  purchasing  power of Comcast's  consolidated  operations.
  Amounts  charged  to  the  Company  by CSI  for  programming  (the  "Programming
  Charges")  are  included  in  operating  expenses  in  the  Company's  condensed
  consolidated  statement  of  operations  and  accumulated  deficit.  The Company
  purchases  certain other services,  including  insurance and employee  benefits,
  from Comcast under  cost-sharing  arrangements  on terms that reflect  Comcast's
  actual cost. The Company  reimburses  Comcast for certain other costs (primarily
  salaries)   under   cost-reimbursement   arrangements.   Under   all  of   these
  arrangements,  the Company  incurred  total  expenses of $40.9 million and $35.2
  million,  including  $36.3  million and $31.0  million of  Programming  Charges,
  during the three  months  ended  March 31,  1997 and 1996,  respectively.  It is
  anticipated  that the Company's cost of cable  programming  will increase in the
  future as cable  programming  rates  increase  and  additional  sources of cable
  programming become available.
  
  The $300,000  decrease in depreciation  and  amortization  expense for the three
  month period from 1996 to 1997 is primarily  due to the timing and extent of the
  rebuild and upgrade of the Company's cable plant.
  
                                          8
  STORER COMMUNICATIONS, INC. AND SUBSIDIARIES
                                      FORM 10-Q
                            QUARTER ENDED MARCH 31, 1997
  
  The $1.6 million  increase in net  investment  loss (income) for the three month
  period from 1996 to 1997 is primarily attributable to the loss recognized on the
  sale of the Time Warner Stock.
  
  The $100,000 increase in income tax expense for the three month period from 1996
  to 1997 is primarily  attributable  to the increase in income  before income tax
  expense.
  
  For the three  months  ended March 31,  1997 and 1996,  the  Company's  earnings
  before income tax expense and fixed charges (interest  expense) of $12.3 million
  and $10.8 million,  respectively,  exceeded its fixed charges of $4.2 million in
  each period.
  
  The  Company  believes  that  its  operations  are not  materially  affected  by
  inflation.
  
  Regulatory Developments
  
  The Company  currently is seeking to justify rates for basic cable  services and
  equipment  in its cable  systems in the State of  Connecticut  on the basis of a
  cost-of-service  showing.  The State of  Connecticut  has ordered the Company to
  reduce such rates and to make refunds to  subscribers.  The Company has appealed
  the  Connecticut  decision to the  Federal  Communications  Commission  ("FCC").
  Recent  pronouncements  from the FCC,  which  generally  support  the  Company's
  position on appeal,  have caused the State of Connecticut to reexamine its prior
  ruling. While the Company cannot predict the outcome of this action, the Company
  believes that the ultimate resolution of this pending regulatory matter will not
  have a material adverse impact on the Company's financial  position,  results of
  operations or liquidity.
  
                                          9
  STORER COMMUNICATIONS, INC. AND SUBSIDIARIES
                                      FORM 10-Q
                            QUARTER ENDED MARCH 31, 1997
  
  PART II.  OTHER INFORMATION
  
  ITEM 1.   Legal Proceedings
  
       The  Company  is not  party to  litigation  which,  in the  opinion  of the
       Company's management,  will have a material adverse effect on the Company's
       financial position, results of operations or liquidity.
  
  ITEM 6.   Exhibits and Reports on Form 8-K
  
       (a)  Exhibits required to be filed by Item 601 of Regulation S-K:
  
            27.1    Financial Data Schedule.
  
       (b)  Reports on Form 8-K - None.
  
                                         10
  STORER COMMUNICATIONS, INC. AND SUBSIDIARIES
                                      FORM 10-Q
                            QUARTER ENDED MARCH 31, 1997
  
                                      SIGNATURE
  
           Pursuant to the  requirements  of the  Securities  and  Exchange Act of
  1934,  the  Registrant has duly caused this report to be signed on its behalf by
  the undersigned thereunto duly authorized.
  
                                      STORER COMMUNICATIONS, INC.
                                      ------------------------------------------
  
                                      /s/ Lawrence S. Smith
                                      ------------------------------------------
                                      Lawrence S. Smith
                                      Senior Vice President
                                      Accounting and Administration
                                      (Principal Financial and Accounting Officer)
  
  Date: May 14, 1997
  
                                         11