TCR_Public/070630.mbx          T R O U B L E D   C O M P A N Y   R E P O R T E R

             Saturday, June 30, 2007, Vol. 11, No. 153

                             Headlines

ADVANCED MARKETING: Files April 2007 Monthly Operating Report
CATHOLIC CHURCH: Davenport Files May 2007 Monthly Operating Report
CATHOLIC CHURCH: San Diego Files April 2007 Operating Report
COLLINS & AIKMAN: Earns $23.8 Million in Period Ended May 15
DELTA WOODSIDE: Files Operating Report for Period Ended May 5

DELTA WOODSIDE: Files Operating Report for Period Ended March 31
DELTA WOODSIDE: Files Operating Report for Period Ended March 3
DELTA WOODSIDE: Files Operating Report for Period Ended February 3
HANCOCK FABRICS: Posts $5.7 Mil. Net Loss in Period Ended June 2
HANCOCK FABRICS: HancockFabrics.com Files Schedules

HANCOCK FABRICS: HF Enterprise Files Schedules of Assets & Debts
HANCOCK FABRICS: Hancock Fabrics LLC Files Schedules
HANCOCK FABRICS: HF Merchandising Files Schedules
HANCOCK FABRICS: Hancock Fabrics of MI Files Schedules
HANCOCK FABRICS: HF Resources Files Schedules of Assets & Debts

MORTGAGE LENDERS: Posts $7.9 Million Net Loss in May 2007
MORTGAGE LENDERS: Posts $136 Million Net Loss in April 2007
MUSICLAND HOLDING: Posts $138,000 Net Loss in May 2007
MUSICLAND HOLDING: Files April 2007 Operating Report

                             *********

ADVANCED MARKETING: Files April 2007 Monthly Operating Report
-------------------------------------------------------------
Advanced Marketing Services Inc.'s monthly operating report
ending April 30, 2007, does not contain a balance sheet and
income statement.

               Advanced Marketing Services, Inc.
        (Excluding Publishers Group West Incorporated)
                   Statement of Cash Flows
                   From April 1 to 30, 2007

CASH RECEIPTS
B&T Purchase Price                               $11,637,105
Reimbursement under B&T TSA                                -
Non-refundable inventory                             354,916
Returnable inventory, net                                  -
CIA inventory                                              -
Vendor accounts receivable                             2,900
Prepaid expenses                                           -
CSV Life Insurance                                         -
Foreign Subs                                         264,371
Standby L/C Expirations                                    -
WF Foothill Fee Reserve                                    -
Interest Income                                       33,801
Other                                                279,703
                                                   ----------
Total Cash Receipts                                12,572,796
                                                   ----------
CASH DISBURSEMENTS
Publisher payments                                         -
Payroll & health insurance                           746,697
KERP                                                       -
MIP                                                        -
Insurance                                             60,615
Rent-facilities                                      312,295
Freight                                              701,572
Shipping Supplies                                          -
Utilities                                             96,073
IT Expenses                                           58,913
Travel                                                 7,030
Professional fees                                  1,260,018
US Trustee Fees                                            -
Office equipment and supplies                          6,866
Communications                                             -
Warehouse equipment                                   12,953
Directors' fees                                            -
Miscellaneous                                         82,747
Post-petition A/P                                          -
                                                   ----------
Total Disbursements                                 3,345,779
                                                   ----------
Net Operating Cash Inflow                           9,227,017

INTERCOMPANY TRANSFERS
PGW Rcpts Swept to AMS                                     -
AMS (To)/From PGW                                  1,500,000
Foreign Subsidiaries                                       -
                                                   ----------
Total I/C Transfers                                1,500,000
                                                   ----------
Net Cash Inflow                                   $10,727,017
                                                   ==========

              Publishers Group West Incorporated
                   Statement of Cash Flows
                     April 1 to 30, 2007

CASH RECEIPTS
Accounts Receivable                               $7,538,844
Perseus - payments for post-petition returns               -
Perseus - reimbursement for customer deductions            -
Perseus - Transition service reimb (PGW costs)             -
Perseus - Transition service reimb (AMS costs)             -
Perseus - Retention plan reimbursement                     -
Interest Income                                            -
Other                                                    459
                                                   ----------
Total Cash Receipts                                 7,539,303
                                                   ----------

INVENTORY DISBURSEMENTS
Publishers - Wires                                    82,918
Publishers - Checks                                   41,634
                                                   ----------
Total Inventory Disbursements                        124,552
                                                   ----------

OPERATING DISBURSEMENTS
Total Payroll (incl. taxes)                          520,287
Employee retention plan                                    -
Temp/contract labor                                   73,979
Health Insurance                                           -
Insurance                                                  -
Rent-facilities                                       23,018
Freight                                              231,334
Shipping supplies                                          -
Utilities                                             11,312
IT Expenses                                              854
Travel                                                56,685
Professional fees                                          -
Office equipment & supplies                           12,054
Communications                                        12,851
Warehouse equipment                                        -
Directors' fees                                            -
Misc                                                 135,513
Post-petition A/P                                          -
                                                   ----------
Total Operating Disbursements                      1,077,887
                                                   ----------
Total Disbursements                                 1,202,439
                                                   ----------
Net Operating Cash Inflow                           6,336,864
                                                   ----------

INTERCOMPANY TRANSFERS
PGW Rcpts. Swept to AMS                                    -
AMS to/(from) PGW                                 (1,500,000)
Reimbursement to AMS                                       -
                                                   ----------
Total I/C Transfers                                (1,500,000)
                                                   ----------
Net Cash Inflow                                    $4,836,864
                                                   ==========

                    About Advanced Marketing

Based in San Diego, Calif., Advanced Marketing Services, Inc.
-- http://www.advmkt.com/-- provides customized merchandising,
wholesaling, distribution and publishing services, currently
primarily to the book industry.  The company has operations in the
U.S., Mexico, the United Kingdom and Australia and employs
approximately 1,200 people Worldwide.

The company and its two affiliates, Publishers Group Incorporated
and Publishers Group West Incorporated filed for chapter 11
protection on Dec. 29, 2006 (Bankr. D. Del. Case Nos. 06-11480
through 06-11482).  Suzzanne S. Uhland, Esq., Austin K. Barron,
Esq., Alexandra B. Feldman, Esq., O'Melveny & Myers, LLP,
represent the Debtors as Lead Counsel.  Chun I. Jang, Esq., Mark
D. Collins, Esq., and Paul Noble Heath, Esq., at Richards, Layton
& Finger, P.A., represent the Debtors as Local Counsel.
Lowenstein Sandler PC represents the Official Committee of
Unsecured Creditors.  When the Debtors filed for protection from
their creditors, they listed estimated assets and debts of more
than $100 million.

The Debtors' exclusive period to file a plan expires on Aug. 10,
2007.  (Advanced Marketing Bankruptcy News, Issue No. 13;
Bankruptcy Creditors' Service Inc. http://bankrupt.com/newsstand/
or 215/945-7000).


CATHOLIC CHURCH: Davenport Files May 2007 Monthly Operating Report
------------------------------------------------------------------

                Diocese of Davenport in Iowa
               Statement of Financial Position
                     As of May 31, 2007

ASSETS

Current Assets
Cash and cash equivalents - unrestricted          $5,306,684
Cash and cash equivalents - restricted             2,455,723
Accounts receivable, net                              28,210
Inventory                                                  -
Prepaid expenses                                       1,778
Professional retainers                                55,652
                                               --------------
Total Current Assets                                7,848,047
                                               --------------
Property and Equipment
Real Property                                      4,684,254
Machinery and equipment                                6,000
Furniture and fixtures                                 8,914
Office equipment                                      59,500
Leasehold improvements                                     -
Vehicles                                              45,460
                                               --------------
Total Property and Equipment                        4,804,128
                                               --------------
Total Assets                                      $12,652,175
                                               ==============

LIABILITIES AND NET ASSETS

Postpetition
Current Liabilities:
    Salaries and wages
    Payroll taxes
    Real and personal property taxes
    Income taxes
    Sales taxes
    Notes payable, short term
    Accounts payable, trade                           $36,291
    Real property lease arrearage
    Personal property lease arrearage
    Accrued professional fees
    Current portion of long-term debt
    Pass-through collections                          210,311
                                               --------------
Total Current Liabilities                            246,602
                                               --------------
Long-Term Postpetition Debt, Net                           -
                                               --------------
Total Postpetition Liabilities                       246,602
                                               --------------
Prepetition
    Secured claims                                          -
    Priority unsecured claims                         160,888
    General unsecured claims                        1,660,316
                                               --------------
Total Prepetition Liabilities                      1,821,204
                                               --------------
   Total Liabilities                                2,067,806
                                               --------------
Equity (deficit):
Retained earnings/deficit at filing                5,795,187
Capital stock
Additional paid-in capital
Cumulative profit/loss since filing                  991,214
Post-petition contributions/distributions
    or draws
Market value adjustment                            3,797,968
                                               --------------
Total equity (deficit)                            10,584,369
                                               --------------
Total liabilities & equity (deficit)              $12,652,175
                                               ==============

                Diocese of Davenport in Iowa
                   Statement of Operations
              For the month ending May 31, 2007

Revenues
Gross sales                                             $501
Less: sales returns & allowances                           -
Net sales                                                501
Less: cost of goods sold                                   -
Gross profit                                             501
Interest                                               2,049
Other income:
    Charitable gifts                                  231,548
    Insurance receipts                                135,083
    Investment income                                  57,393
                                               --------------
Total revenues                                       426,574
                                               --------------
Expenses:
Compensation to owner(s)/officer(s)                   12,578
Salaries                                              97,715
Commissions                                                -
Contract labor                                         7,585
Rent/Lease:
    Personal property                                   2,769
    Real property                                       1,000
Insurance                                             90,049
Management fees                                            -
Depreciation                                           5,945
Taxes:
    Employer payroll taxes                              6,174
    Real property taxes                                     -
    Other taxes                                             -
Other selling                                              -
Other administrative                                  37,899
Interest                                                   -
Other expenses:
    Employee benefits                                  31,916
    Charity collection                                 33,189
    Medical assistance/Victim assistance                2,039
    Utilities                                           9,276
    Professional fees                                     812
                                               --------------
       Total expenses                                 338,946
                                               --------------
Reorganization items:
    Professional fees                                  (2,343)
    Provisions for rejected
       executory contracts                                  -
    Interest earned on accumulated cash
       from resulting Chapter 11 case                  17,083
    Gain or (Loss) from sale of equipment                   -
    U.S. Trustee quarterly fees                        (1,250)
    Advertising/printing/mailing                       (1,383)
                                               --------------
       Total reorganization items                      12,107
                                               --------------
Net profit (loss) before federal &
state taxes                                           99,735
Federal & state income taxes                               -
                                               --------------
Net profit (loss)                                     $99,735
                                                =============

                Diocese of Davenport in Iowa
        Statement of Cash Receipts and Disbursements
           For the month ending May 31, 2007

Cash receipts
Rent/Leases collected                                 $3,375
Cash received from sales                                 501
Interest received                                     19,132
Borrowings increase in accounts payable
Funds from shareholders, partners,
    or other insiders
Capital contributions
Annual diocesan appeal/donations                     231,548
Investment income/misc.                                    -
Insurance receipts                                   135,083
Tribunal/Immigration/Faith Formation fees             54,018
Decrease in prepaids/accounts receivable                   -
Misc./Increase in accounts payable                    75,792
                                               --------------
Total Cash Receipts                                  519,449

Cash disbursements:
Payments for inventory                                     -
Selling                                                    -
Administrative                                        88,230
Capital expenditures                                       -
Principal payments on debt                                 -
Interest paid                                              -
Rent/Lease:
    Personal Property                                       -
    Real Property                                           -
Amount paid to owner(s)/officer(s)
    Salaries                                           12,578
    Draws                                                   -
    Commissions/Royalties                                   -
    Expense Reimbursements                                  -
    Other                                                   -
Salaries/Commissions (less employee
    withholding                                        76,094
Management fees
Taxes
    Employee withholding                               21,621
    Employer payroll taxes                              6,174
    Real property taxes                                     -
    Other taxes                                             -
Other cash outflows:
    Insurance                                          90,049
    Utilities                                           9,276
    Medical Assistance                                  2,039
    Employee benefits                                  31,916
    Misc                                               37,736
                                               --------------
Total Cash Disbursements                             375,713
                                               --------------
Net increase (decrease) in cash                       143,736

Cash balance, beginning of period                   1,425,807

Cash balance, end of period                        $1,569,543
                                               ==============

                   About Diocese of Davenport

The Diocese of Davenport in Iowa filed for chapter 11 protection
(Bankr. S.D. Ia. Case No. 06-02229) on October 10, 2006.
Richard A. Davidson, Esq., at Lane & Waterman LLP, represents the
Davenport Diocese in its restructuring efforts.  Hamid R.
Rafatjoo, Esq., and Gillian M. Brown, Esq., of Pachulski Stang
Zhiel Young Jones & Weintraub LLP represent the Official Committee
of Unsecured Creditors.  In its schedules of assets and
liabilities, the Davenport Diocese reported $4,492,809 in assets
and $1,650,439 in liabilities.

Davenport's exclusive period to file a plan will expire on
Aug. 15, 2007.  Its exclusive period to solicit acceptances of
its plan will expire on Oct. 14, 2007.  (Catholic Church
Bankruptcy News, Issue No. 95; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000).


CATHOLIC CHURCH: San Diego Files April 2007 Operating Report
------------------------------------------------------------

                    Diocese of San Diego
               Statement of Financial Position
                    As of April 30, 2007

ASSETS

Cash and cash equivalents                          $17,311,230
Funds on deposit with administrative offices:                -
Perpetual Care Funds                                        -
Funds on deposit                                            -
Other funds on deposit                                      -
Marketable securities                               39,205,604
Accounts receivable, net of allowance                        -
Parishes and School                                 1,084,677
PSDL Trust                                            354,650
Cemetery trade                                      4,381,952
Tuition, fees and others                            1,323,743
Juan Diego Trust                                      109,343
Notes and other receivables                             36,986
Planned gifts receivable                             5,357,998
Prepaid expenses                                        29,474
Inventory                                               14,507
Revisionary Interest in CSE                         65,000,000
Property and equipment, net                         20,879,056
Other land and buildings, net
Cemetery inventory - graves, crypts & niches        6,622,972
Cemetery undeveloped land & outside property        1,365,793
Mater Dei land and land improvements               13,819,408
Mater Dei buildings                                52,590,867
Oceanside land and land improvements                5,551,035
Other assets                                                 -
                                                --------------
Total Assets                                      $235,039,295
                                                ==============

LIABILITIES AND NET ASSETS

Liabilities:
Accounts payable and accrued liabilities           $1,699,280
Special collections                                   257,327
Accrued vacation                                      359,067
Construction loan - ALSAM Foundation               38,620,000
Payable to PSDL Trust                              23,285,353
Funds on deposit:
    Parish and school funds & endowments               397,409
    Perpetual Care Funds                                     -
    Restricted funds on deposit                              -
    Other diocesan entities funds                            -
Reserve for worker's compensation claims            1,564,509
Priest retirement plan liability                    1,994,494
Planned gifts liability                             1,327,535
Deferred revenue:
    Annual Catholic Appeal                                   -
    Cemetery                                         3,224,029
    Tuition and other fees                           1,399,729
    Other                                                6,719
                                                --------------
Total liabilities                                 $74,135,452
                                                --------------
Net Assets:
Unrestricted:
    Undesignated                                  $115,304,515
    Insurance reserve funds                          7,463,922
    Bishop's burse                                   1,314,663
    Designated funds                                   321,408
    Property and equipment                          16,581,782
                                                --------------
Total unrestricted                                140,986,290

Temporarily restricted                             11,571,019
Permanently restricted                              8,346,533
                                                --------------
Total net assets                                  160,903,842
                                                --------------
Total liabilities and net assets                 $235,039,295
                                                ==============

                    Diocese of San Diego
                   Statement of Activities
             For the month ending April 30, 2007

Support and revenue:
Parish assessments                                   $602,641
Donations and fundraising                             365,313
Investment income                                     744,965
Interest and other income                              35,108
Parish & employee insurance reserve funds, net              -
Rental income                                          15,064
Administrative fees                                   291,956
Cemetery sales                                        266,012
Tuition, net of tuition assistance                    667,091
Student and other fees                                 14,575
Concessions/food service                               10,397
Other                                                  34,882
                                                --------------
Total support and revenue                            3,048,005

Expenses:
Administrative                                        259,126
Programs                                              319,093
Cemetery cost of sales                                 31,652
General:
    Contributions and charitable programs               42,864
    Interest expense
       Funds on deposit                                  4,064
       Other                                           156,864
    Depreciation                                        41,495
    Bad debt expense                                         -
    Recruiting, advertising & public relations           3,928
    Student related expenses                           287,677
    Concessions/food service                            11,812
    Athletics                                           21,248
    Development/special events                           1,900
    Operating expenses                                 315,682
    Chaplaincies and ministries                         73,008
    Assessments                                            760
    Professional fees                                    3,172
    Chapter 11 fees                                          -
       Legal fees                                        7,736
    Other                                               70,751
                                                --------------
Total Expenses                                       1,652,879

Funds released from restricted funds                        0
Net change in designated funds                         (4,951)
                                                --------------
                                                        (4,951)
                                                --------------
Increase (decrease) in net assets                    1,395,126
                                                --------------
Net assets:
Beginning of month                                159,508,716
                                                --------------
End of month                                     $160,903,842
                                                ==============

                    Diocese of San Diego
               Cash Receipts and Disbursement
             For the month ending April 30, 2007

Total receipts - prior general account reports      $6,176,871
Less: total disbursements                            2,881,319
Beginning balance                                   16,713,834

Receipts during current period:
Transfers from main account
Accounts receivable - pre-filing                     380,177
Accounts receivable - assessment post-filing         463,997
Receipts - clearing                                1,079,353
A/R CES                                                2,588
Annual Catholic Appeal                               319,634
Interest                                              12,641
Dividends                                                198
Miscellaneous                                          5,323
Tribunal income                                        4,425
Southern Cross income                                 15,233
Programs and ministries                              774,637
Registration and tuitions                            355,327
Receipts - reimbursements and other                   53,502
Unreconciled item                                     15,508
Other Diocesan locations' deposits                   548,479
Stock processing                                     274,854
Athletics                                              1,010
Concessions and store sales                            7,268
Restricted account receipts                            5,697
Donations                                             27,638
                                               --------------
Total receipts                                      4,347,497

Balance                                            21,061,332

Less: Total disbursements during current period
Transfers to Diocese from Service Receipients
    Workers' compensation premium                    (153,360)
    Priest health - SIF Protion                        (5,776)
Transfers to Priest Health Account                    19,746
Transfers to payroll account                         366,306
Transfers to medical reimbursement                   247,137
Disbursements - clearing                              36,818
Unreconciled items                                       216
Administrative                                        64,635
A/R CES                                                  784
Athletics                                              7,347
Bank fees and charges                                 20,699
Brokerage commissions                                    378
Stock processing                                     274,854
Conferences                                           26,925
Utility deposits                                      27,740
Dues/Fees                                              2,569
Fundraising                                            2,671
Education expenses                                     4,775
Employee benefits                                      4,770
Facilities                                            25,303
Health insurance and benefits                         63,659
Health insurance claims paid                         972,150
Lay salaries and wages                                11,412
Liability insurance                                    4,813
Maintenance/Repairs                                   23,719
Medical reimbursements                                11,810
Ministries                                             7,620
Miscellaneous                                         47,003
Scholarships - Donations                                 100
Supplies                                              13,033
Operations                                           317,475
Payroll                                              459,678
Postage                                               11,706
Professional fees                                     44,141
Printing                                              17,230
Rent                                                  19,445
Restricted                                            54,590
Sales tax                                              1,642
Special collections                                  148,251
Seminarian tuition                                     8,075
Stipends/Services                                     40,879
Utilities                                             14,217
Adjustment for February voids                         50,674
                                               --------------
                                                    3,317,873
                                               --------------
Ending balance                                    $17,743,459
                                               ==============

                   About the San Diego Diocese

The Roman Catholic Diocese of San Diego in California --
http://www.diocese-sdiego.org/-- employs approximately
3,000 people in various areas of work.  The Diocese filed for
Chapter 11 protection just before commencement of the first of
court proceedings for 140 sexual abuse lawsuits filed against the
Diocese.  Authorities of the San Diego Diocese said they were not
in favor of litigating their cases.

The San Diego Diocese filed for chapter 11 protection on Feb. 27,
2007 (Bankr. S.D. Calif. Case No. 07-00939).  Gerald P. Kennedy,
Esq., at Procopio, Cory, Hargreaves and Savitch LLP, represents
the Diocese.  In its schedules of assets and liabilities, the
Diocese listed total assets of $152,510,888 and total liabilities
of $72,754,092.

The Diocese's exclusive period to file a chapter 11 plan of
reorganization expires tomorrow, June 27, 2007.  On March 27,
2007, the Debtor filed its plan and disclosure statement.
(Catholic Church Bankruptcy News, Issue No. 95; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000).


COLLINS & AIKMAN: Earns $23.8 Million in Period Ended May 15
------------------------------------------------------------

                 Collins & Aikman Corporation
                        Balance Sheet
                     As of May 16, 2007

                            ASSETS

Cash                                              $187,718,722
Accounts receivable-trade, net                     127,178,506
Other non-trade receivables                         10,644,232
Inventories, net                                    33,853,422
Tooling and molding, net-current                    49,668,790
Prepaids & other current assets                     42,113,534
Deferred tax assets-current                                  0
                                               ---------------
TOTAL CURRENT ASSETS                               451,177,206

Investments in subsidiaries                      2,479,293,518
Fixed assets, net                                  232,774,692
Goodwill, net                                       59,622,121
Deferred tax assets-long term                                0
Tooling and molding, net-long term                   5,198,309
Other noncurrent assets                             26,587,378
Intercompany accounts - net                         85,238,673
Prepetition intercompany - net                     670,316,228
                                               ---------------
TOTAL ASSETS                                    $4,010,208,126
                                               ===============

                     LIABILITIES & EQUITY

Notes payable                                               $0
Short term borrowings                                        0
Advance on receivables                                       0
Current portion-long term debt                     109,541,044
Current portion-capital leases                               0
Accounts payable                                    52,670,262
Accrued interest payable                            72,943,133
Accrued & other liabilities                        134,548,423
Income taxes payable                                 3,053,922
                                               ---------------
Total current liabilities                          372,756,783

Liabilities subject to compromise                2,384,702,468
Deferred income taxes                               30,472,400
                                               ---------------
Total liabilities                                2,787,931,651

Total equity                                     1,222,276,475
                                               ---------------
TOTAL LIABILITIES & EQUITY                      $4,010,208,126
                                               ===============

                Collins & Aikman Corporation
                      Income Statement
                 Month Ending May 15, 2007

Net outside sales                                  $64,276,570
I/C Net sales                                        3,567,576
                                               ---------------
Total sales                                         67,844,146

Cost of Sales                                       48,809,720
                                               ---------------
Gross profit                                        19,034,426

Selling, general & administrative expenses          (2,034,037)
                                               ---------------
Operating income                                    21,068,463

Interest expenses, net                               3,904,282
Intercompany interest, net                          (1,669,844)
Preferred stock accretion                                    0
Miscellaneous (income)/expense                               0
Corporate allocation adjustment                     (4,950,442)
Commission income                                      (85,693)
Commission expense                                           0
Royalty income                                        (182,831)
Royalty expense                                              0
Joint Venture (Income)/Expense                               0
Minority interest in cons net income                         0
Dividend income                                              0
Discount/Income for Carcorp.                                 0
Gain/(Loss) early extinguishments of debt                    0
Discount/Premium on hedges                                   0
(Gain)/Loss on hedges                                        0
(Gain)/Loss on swaps                                         0
NAAIS Intercompany sales profit                              0
Loss on sale of receivables                                  0
Restructuring provision                                      0
Asset Impairment                                             0
Foreign transactions - (Gain)/Loss                     198,902
Amort of discount on NPV of liabilities                      0
(Gain)/Loss on sale-leaseback transaction                    0
                                               ---------------
Income from continuing operations before taxes      23,854,089

Federal income tax                                           0
State income tax                                             0
Foreign income tax                                      11,426
                                               ---------------
Income from continuing operations                   23,842,663

Discontinued operations                                  7,595
Gain/Loss on sale of divisions                               0
Extraordinary items                                          0
Integration                                                  0
                                               ---------------
NET INCOME (LOSS)                                  $23,835,068
                                               ===============

                     About Collins & Aikman

Headquartered in Troy, Mich., Collins & Aikman Corporation --
http://www.collinsaikman.com/-- is a global leader in cockpit  
modules and automotive floor and acoustic systems and is a leading
supplier of instrument panels, automotive fabric, plastic-based
trim, and convertible top systems.  The Company has a workforce of
approximately 23,000 and a network of more than 100 technical
centers, sales offices and manufacturing sites in 17 countries
throughout the world.  The Company and its debtor-affiliates filed
for chapter 11 protection on May 17, 2005 (Bankr. E.D. Mich.
Case No. 05-55927).  Richard M. Cieri, Esq., at Kirkland & Ellis
LLP, represents C&A in its restructuring.  Lazard Freres & Co.,
LLC, provides the Debtors with investment banking services.  
Michael S. Stammer, Esq., at Akin Gump Strauss Hauer & Feld LLP,
represents the Official Committee of Unsecured Creditors
Committee.  When the Debtors filed for protection from their
creditors, they listed $3,196,700,000 in total assets and
$2,856,600,000 in total debts.

On Aug. 30, 2006, the Debtors filed their Chapter 11 Plan and
Disclosure Statement.  On Dec. 22, 2006, they filed an Amended
Joint Chapter 11 Plan.  The Court approved the adequacy of the
Amended Disclosure Statement.  The Court has adjourned the hearing
to consider confirmation of the Amended Joint Plan to July 12,
2007.  (Collins & Aikman Bankruptcy News, Issue No. 66; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/ or
215/945-7000)


DELTA WOODSIDE: Files Operating Report for Period Ended May 5
-------------------------------------------------------------
Delta Woodside Industries Inc., Delta Mills Inc., and Delta Mills
Marketing Inc. filed their monthly operating report for the period
from April 1, 2007, to May 5, 2007, with the United States
Bankruptcy Court for the District of Delaware on June 25, 2007.

                 Delta Woodside Industries Inc.

Delta Woodside Industries reported a net loss of $428 on zero
revenue for the period from April 1, 2007, to May 5, 2007.

At May 5, 2007, Delta Woodside's balance sheet showed:

       Total Current Assets                 ($245,000)
       Total Assets                         ($248,000)
       Total Liabilities                 ($17,238,000)
       Total Shareholders' Equity         $16,990,000

A full-text copy of Delta Woodside's Monthly Operating Report is
available at no charge at http://ResearchArchives.com/t/s?2136

                         Delta Mills Inc.

Delta Mills reported a net loss of $886,095 on revenues of
$912,101 for the period from April 1, 2007, to May 5, 2007.

At May 5, 2007, Delta Mills' balance sheet showed:

       Total Current Assets                  $14,755,000
       Total Assets                          $24,164,000
       Total Liabilities                    [$56,644,000]
       Total Shareholders' Deficit          ($32,480,000)

A full-text copy of Delta Mill's Monthly Operating Report is
available at no charge at http://ResearchArchives.com/t/s?2136

                   Delta Mills Marketing Inc.

Delta Mills Marketing reported a net loss of $112,561 on zero
revenue for the period April 1, 2007, to May 5, 2007.

At May 5, 2007, Delta Mills Marketing's balance sheet showed:

       Total Current Assets                      $55,000
       Total Assets                              $56,000
       Total Liabilities                    [($2,145,000)]
       Total Shareholders' Equity             $2,089,000

A full-text copy of Delta Mill's Monthly Operating Report is
available at no charge at http://ResearchArchives.com/t/s?2136

                       About Delta Woodside

Based in Greenville, South Carolina, Delta Woodside Industries,
Inc. (OTCBB: DLWI), through its wholly owned subsidiary, Delta
Mills, manufactures and sells textile products for the apparel
industry.  The company employs about 600 people and operates two
plants located in South Carolina.

The company, its wholly owned subsidiary Delta Mills Inc., and
Delta Mills Marketing Inc., the wholly owned subsidiary of Delta
Mills, filed for chapter 11 protection on Oct. 13, 2006 (Bank. D.
Del. Lead Case No. Case Nos. 06-11144).  Robert J. Dehney, Esq.,
Margaret E. Juliano, Esq., Robert J. Dehney, Esq., and Thomas F.
Driscoll, Esq., at Morris, Nichols, Arsht & Tunnell LLP represent
the Debtors.  Jeffrey R. Waxman, Esq., and Mark E. Felger, Esq.,
at Cozen O'Connor, represent the Official Committee of Unsecured
Creditors.


DELTA WOODSIDE: Files Operating Report for Period Ended March 31
----------------------------------------------------------------
Delta Woodside Industries Inc., Delta Mills Inc., and Delta Mills
Marketing Inc. filed their monthly operating report for the period
from March 4, 2007, to March 31, 2007, with the United States
Bankruptcy Court for the District of Delaware on June 25, 2007.

                 Delta Woodside Industries Inc.

Delta Woodside Industries reported a net loss of $428 on zero
revenue for the for the period from March 4, 2007, to March 31,
2007.

At March 31, 2007, Delta Woodside's balance sheet showed:

       Total Current Assets                 ($248,000)
       Total Assets                         ($248,000)
       Total Liabilities                  ($17,238,000)
       Total Shareholders' Equity         $16,991,000

A full-text copy of Delta Woodside's March 2007, Monthly
Operating Report is available at no charge at:

               http://ResearchArchives.com/t/s?213a

                         Delta Mills Inc.

Delta Mills reported a net loss of $1,098,487 on revenues of
$567,758 for the period March 4, 2007, to March 31, 2007.

At March 31, 2007, Delta Mills' balance sheet showed:

       Total Current Assets                  $15,926,000
       Total Assets                          $25,347,000
       Total Liabilities                    [$56,940,000]
       Total Shareholders' Deficit          ($31,593,000)

A full-text copy of Delta Mill's March 2007, Monthly
Operating Report is available at no charge at:

              http://ResearchArchives.com/t/s?213a

                   Delta Mills Marketing Inc.

Delta Mills Marketing reported a net loss of $123,229 on zero
revenue for the period from March 4, 2007, to March 31, 2007.

At March 31, 2007, Delta Mills Marketing's balance sheet showed:

       Total Current Assets                      $55,000
       Total Assets                              $55,000
       Total Liabilities                    [($2,161,000)]
       Total Shareholders' Equity             $2,212,000

A full-text copy of Delta Mill's March 2007 Monthly
Operating Report is available at no charge at:

               http://ResearchArchives.com/t/s?213a

                       About Delta Woodside

Based in Greenville, South Carolina, Delta Woodside Industries,
Inc. (OTCBB: DLWI), through its wholly owned subsidiary, Delta
Mills, manufactures and sells textile products for the apparel
industry.  The company employs about 600 people and operates two
plants located in South Carolina.

The company, its wholly owned subsidiary Delta Mills Inc., and
Delta Mills Marketing Inc., the wholly owned subsidiary of Delta
Mills, filed for chapter 11 protection on Oct. 13, 2006 (Bank. D.
Del. Lead Case No. Case Nos. 06-11144).  Robert J. Dehney, Esq.,
Margaret E. Juliano, Esq., Robert J. Dehney, Esq., and Thomas F.
Driscoll, Esq., at Morris, Nichols, Arsht & Tunnell LLP represent
the Debtors.  Jeffrey R. Waxman, Esq., and Mark E. Felger, Esq.,
at Cozen O'Connor, represent the Official Committee of Unsecured
Creditors.


DELTA WOODSIDE: Files Operating Report for Period Ended March 3
---------------------------------------------------------------
Delta Woodside Industries Inc., Delta Mills Inc., and Delta Mills
Marketing Inc. filed their monthly operating report for the period
from Feb. 4, 2007, to March 3, 2007, with the United States
Bankruptcy Court for the District of Delaware on June 25, 2007.

                 Delta Woodside Industries Inc.

Delta Woodside Industries reported a net loss of $5,906 on zero
revenue for the period from Feb. 4, 2007, to March 3, 2007.

At March 3, 2007, Delta Woodside's balance sheet showed:

       Total Current Assets                 ($247,000)
       Total Assets                         ($247,000)
       Total Liabilities                 ($17,238,000)
       Total Shareholders' Equity         $16,991,000

A full-text copy of Delta Woodside's Monthly Operating Report is
available at no charge at http://ResearchArchives.com/t/s?2137

                         Delta Mills Inc.

Delta Mills reported a net loss of $22,337,339 on revenues of
$817,027 for the period from Feb. 4, 2007, to March 3, 2007.

At March 3, 2007, Delta Mills' balance sheet showed:

       Total Current Assets                  $17,703,000
       Total Assets                          $27,132,000
       Total Liabilities                    [$57,627,000]
       Total Shareholders' Deficit          ($30,495,000)

A full-text copy of Delta Mill's Monthly Operating Report is
available at no charge at http://ResearchArchives.com/t/s?2137

                   Delta Mills Marketing Inc.

Delta Mills Marketing reported a net loss of $137,956 on zero
revenue for the period from Feb 4, 2007, to March 3, 2007.

At March 3, 2007, Delta Mills Marketing's balance sheet showed:

       Total Current Assets                      $9,000
       Total Assets                              $10,000
       Total Liabilities                    [($2,330,000)]
       Total Shareholders' Equity             $2,336,000

A full-text copy of Delta Mill's Monthly Operating Report is
available at no charge at http://ResearchArchives.com/t/s?2137

                       About Delta Woodside

Based in Greenville, South Carolina, Delta Woodside Industries,
Inc. (OTCBB: DLWI), through its wholly owned subsidiary, Delta
Mills, manufactures and sells textile products for the apparel
industry.  The company employs about 600 people and operates two
plants located in South Carolina.

The company, its wholly owned subsidiary Delta Mills Inc., and
Delta Mills Marketing Inc., the wholly owned subsidiary of Delta
Mills, filed for chapter 11 protection on Oct. 13, 2006 (Bank. D.
Del. Lead Case No. Case Nos. 06-11144).  Robert J. Dehney, Esq.,
Margaret E. Juliano, Esq., Robert J. Dehney, Esq., and Thomas F.
Driscoll, Esq., at Morris, Nichols, Arsht & Tunnell LLP represent
the Debtors.  Jeffrey R. Waxman, Esq., and Mark E. Felger, Esq.,
at Cozen O'Connor, represent the Official Committee of Unsecured
Creditors.


DELTA WOODSIDE: Files Operating Report for Period Ended February 3
------------------------------------------------------------------
Delta Woodside Industries Inc., Delta Mills Inc., and Delta Mills
Marketing Inc. filed their monthly operating report for the period
from Jan. 1, 2007, to Feb. 3, 2007, with the United States
Bankruptcy Court for the District of Delaware on March 29, 2007.

                 Delta Woodside Industries Inc.

Delta Woodside Industries reported a net loss of $9,670 on zero
revenue for the period from Jan. 1, 2007, to Feb. 3, 2007.

At Feb. 3, 2007, Delta Woodside's balance sheet showed:

       Total Current Assets                 ($246,000)
       Total Assets                         ($246,000)
       Total Liabilities                 ($17,389,000)
       Total Shareholders' Equity         $16,997,000

A full-text copy of Delta Woodside's Monthly Operating Report is
available at no charge at http://ResearchArchives.com/t/s?1cca

                         Delta Mills Inc.

Delta Mills reported a net loss of $614,015 on revenues of
$2,532,881 for the period from Jan. 1, 2007, to Feb. 3, 2007.

At Feb. 3, 2007, Delta Mills' balance sheet showed:

       Total Current Assets                  $17,742,000
       Total Assets                          $49,495,000
       Total Liabilities                    [$57,652,000]
       Total Shareholders' Deficit          ($8,158,000)

A full-text copy of Delta Mill's Monthly Operating Report is
available at no charge at http://ResearchArchives.com/t/s?1cca

                   Delta Mills Marketing Inc.

Delta Mills Marketing reported a net loss of $51,783,956 on zero
revenue for the period from Jan. 1, 2007, to Feb. 3, 2007.

At Feb. 3, 2007, Delta Mills Marketing's balance sheet showed:

       Total Current Assets                      $12,000
       Total Assets                              $12,000
       Total Liabilities                    [($2,466,000)]
       Total Shareholders' Equity             $2,473,000

A full-text copy of Delta Mill's Monthly Operating Report is
available at no charge at http://ResearchArchives.com/t/s?1cca

                       About Delta Woodside

Based in Greenville, South Carolina, Delta Woodside Industries,
Inc. (OTCBB: DLWI), through its wholly owned subsidiary, Delta
Mills, manufactures and sells textile products for the apparel
industry.  The company employs about 600 people and operates two
plants located in South Carolina.

The company, its wholly owned subsidiary Delta Mills Inc., and
Delta Mills Marketing Inc., the wholly owned subsidiary of Delta
Mills, filed for chapter 11 protection on Oct. 13, 2006 (Bank. D.
Del. Lead Case No. Case Nos. 06-11144).  Robert J. Dehney, Esq.,
Margaret E. Juliano, Esq., Robert J. Dehney, Esq., and Thomas F.
Driscoll, Esq., at Morris, Nichols, Arsht & Tunnell LLP represent
the Debtors.  Jeffrey R. Waxman, Esq., and Mark E. Felger, Esq.,
at Cozen O'Connor, represent the Official Committee of Unsecured
Creditors.


HANCOCK FABRICS: Posts $5.7 Mil. Net Loss in Period Ended June 2
----------------------------------------------------------------

           Hancock Fabrics, Inc., and Subsidiaries
                 Consolidated Balance Sheet
                     As of June 2, 2007

ASSETS
Current assets:
Cash and cash equivalents                          $3,838,000
Receivables, less allowance for
   doubtful accounts                                 5,530,000
Inventories                                        81,494,000
Income taxes refundable                             7,116,000
Prepaid expenses                                    2,423,000
                                                  ------------
   Total current assets                            100,401,000

Property and equipment,
    at depreciated cost                             48,802,000
Other assets                                       15,736,000
                                                  ------------
Total Assets                                     $164,939,000
                                                  ============

LIABILITIES AND SHAREHOLDERS' EQUITY

Liabilities not subject to compromise:
Accounts Payable                                  $10,154,000
Credit facility: DIP financing                     10,596,000
Accrued liabilities                                 8,960,000
Deferred tax liabilities                            7,152,000
                                                  ------------

Liabilities subject to compromise:
Accounts payable                                   30,554,000
Accrued liabilities                                11,902,000
Long-term lease financing
    obligations                                      3,997,000
Capital lease obligations                           1,726,000
Post-retirement benefits other
    than pensions                                    9,345,000
Pension and SERP liabilities                        8,498,000
Other liabilities                                   9,575,000
                                                  ------------
Total liabilities                                 112,459,000
                                                  ------------
Total shareholders' equity                         52,480,000
                                                  ------------
Total liabilities & shareholders' equity         $164,939,000
                                                  ============

           Hancock Fabrics, Inc., and Subsidiaries
            Consolidated Statement of Operations
              For the Month Ended June 2, 2007

Sales                                               $27,876,000
Cost of goods sold                                   20,377,000
                                                   ------------
Gross profit                                         7,499,000

Selling, general and administrative expense          10,407,000
Depreciation and amortization                           410,000
                                                   ------------
Operating income (loss)                            (3,318,000)

Reorganization expenses                               2,129,000
Interest expense, net                                   261,000

Earnings (loss) before income taxes                  (5,708,000)
Income taxes                                                  -
                                                   ------------
Net earnings (loss)                                 ($5,708,000)
                                                   ============

           Hancock Fabrics, Inc., and Subsidiaries
             Consolidated Statement of Cash Flow
              For the Month Ended June 2, 2007

Cash flows from operating activities:
Net earnings                                      ($5,708,000)
Adjustments to reconcile net earnings to
cash flows used in operating activities
    Depreciation and amortization                      613,000
    Amortization of deferred loans                      83,000
    LIFO charge (credit)                            (3,596,000)
    Amortization of deferred compensation
       on restricted stock incentive plan               55,000
    Reserve for store closings credits                (134,000)
    Reserve for obsolete inventory                      (8,000)
    Reserve for sales returns bad debts                      -
    Stepped rent accrual                              (111,000)
    Loss of disposition of property & equipment         72,000
    Stock compensation expense                          70,000
(Increase) decrease in assets
    Receivable and prepaid expenses                   (924,000)
    Inventory at current cost                       13,758,000
    Income tax refundable                                    0
    Other non-current assets                           167,000
Increase (decrease) in liabilities
    Accounts payable                                   840,000
    Accrued liabilities                               (665,000)
    Income taxes payable                                     0
    Postretirement benefits other than pension         (43,000)
    Long-term pension and SERP liabilities             156,000
    Reserve for store closings                        (202,000)
    Other liabilities                                  (44,000)
                                                   -----------
    Net cash used in operating activities            4,379,000

Cash flows from investing activities:
Additions to property and equipment                   (42,000)
Proceeds from the disposition of property
    and equipment                                      282,000
                                                  ------------
Net cash used in investing activities                 240,000

Cash flows from financing activities:
Net borrowing on revolving credit agreement        (5,297,000)
Payments for lease financing                           (7,000)
Payments for capital leases                            (3,000)
Tax obligation settled with treasury stock                  -
                                                  ------------
Net cash provided by financing activities          (5,307,000)

Decrease in cash and cash equivalents                 (688,000)

Cash and cash equivalents, beginning of period        4,526,000
                                                   ------------
Cash and cash equivalents, end of period             $3,838,000
                                                   ============

                      About Hancock Fabrics

Headquartered in Baldwyn, Miss., Hancock Fabrics Inc. (OTC: HKFIQ)
-- http://www.hancockfabrics.com/-- is a specialty retailer of a  
wide selection of fashion and home decorating textiles, sewing
accessories, needlecraft supplies and sewing machines.  Hancock
Fabrics is one of the largest fabric retailers in the United
States, currently operating approximately 400 retail stores in
approximately 40 states.  The company employs approximately 7,500
people on a full-time and part-time basis.  Most of the company's
employees work in its retail stores, or in field management to
support its retail stores.

The company and 6 of its debtor-affiliates filed for chapter 11
protection on March 21, 2007 (Bankr. D. Del. Lead Case No.
07-10353).  Robert J. Dehney, Esq., at Morris, Nichols, Arsht &
Tunnell, represent the Debtors.  When the Debtors filed for
protection from their creditors, they listed $241,873,900 in total
assets and 161,412,000 in total liabilities.

The Debtors exclusive period to file a chapter 11 plan expires on
July 19, 2007.  (Hancock Fabric Bankruptcy News, Issue No. 12,
http://bankrupt.com/newsstand/or 215/945-7000).


HANCOCK FABRICS: HancockFabrics.com Files Schedules
---------------------------------------------------
HancockFabrics.com, Hancock Fabrics Inc.'s debtor-affiliate, filed
with the United States Bankruptcy Court for the District of
Delaware, its schedules of assets and liabilities, disclosing:

A.      Real Property                                        $0
B.      Personal Property
B.16    Accounts receivable
         Credit Card Receivable                          18,254
B.22    Patents, copyrights & trademarks           undetermined
B.29    Machinery, furniture and fixtures
         Furniture, Fixtures & Equipment               $158,452
B.30    Inventory
         Retail Inventory                               466,767

      TOTAL SCHEDULED ASSETS                         $1,764,017
                                                    ===========

C.      Property Claimed as Exempt               Not applicable

D.      Creditors Holding Secured Claims
         Wachovia Bank, NA                          $53,224,413
         Wachovia Bank, NA                            8,711,508
E.      Creditors Holding Unsecured
      Priority Claims
         Taxes                                                0
F.      Creditors Holding Unsecured Claims
         Non-Priority Claims                                  0

      TOTAL SCHEDULED LIABILITIES                   $61,935,921
                                                   ============

                      About Hancock Fabrics

Headquartered in Baldwyn, Miss., Hancock Fabrics Inc. (OTC: HKFIQ)
-- http://www.hancockfabrics.com/-- is a specialty retailer of a  
wide selection of fashion and home decorating textiles, sewing
accessories, needlecraft supplies and sewing machines.  Hancock
Fabrics is one of the largest fabric retailers in the United
States, currently operating approximately 400 retail stores in
approximately 40 states.  The company employs approximately 7,500
people on a full-time and part-time basis.  Most of the company's
employees work in its retail stores, or in field management to
support its retail stores.

The company and 6 of its debtor-affiliates filed for chapter 11
protection on March 21, 2007 (Bankr. D. Del. Lead Case No.
07-10353).  Robert J. Dehney, Esq., at Morris, Nichols, Arsht &
Tunnell, represent the Debtors.  When the Debtors filed for
protection from their creditors, they listed $241,873,900 in total
assets and 161,412,000 in total liabilities.

The Debtors exclusive period to file a chapter 11 plan expires on
July 19, 2007.  (Hancock Fabric Bankruptcy News, Issue No. 12,
http://bankrupt.com/newsstand/or 215/945-7000).


HANCOCK FABRICS: HF Enterprise Files Schedules of Assets & Debts
----------------------------------------------------------------
HF Enterprise, Hancock Fabrics Inc.'s debtor-affiliate, filed with
the United States Bankruptcy Court for the District of Delaware,
its schedules of assets and liabilities, disclosing:

A.      Real Property                                        $0
B.      Personal Property
B.1     Cash on hand                                          0
B.2     Bank accounts
         PNC Bank                                         1,737
         PNC Bank                                        18,149
B.13    Stock and Interests                        undetermined
B.16    Accounts receivable
         Royalty due from Hancock Merchandising       7,836,596
B.22    Patents, copyrights & trademarks           undetermined
B.23    Licenses & franchises                      undetermined

      TOTAL SCHEDULED ASSETS                         $7,856,482
                                                   ============

C.      Property Claimed as Exempt               Not applicable

D.      Creditors Holding Secured Claims
         Wachovia Bank, NA                          $53,224,413
         Wachovia Bank, NA                            8,711,508
E.      Creditors Holding Unsecured
       Priority Claims
         Taxes                                                0
F.      Creditors Holding Unsecured Claims
         Non-Priority Claims                                  0

      TOTAL SCHEDULED LIABILITIES                   $61,935,921
                                                   ============

                      About Hancock Fabrics

Headquartered in Baldwyn, Miss., Hancock Fabrics Inc. (OTC: HKFIQ)
-- http://www.hancockfabrics.com/-- is a specialty retailer of a  
wide selection of fashion and home decorating textiles, sewing
accessories, needlecraft supplies and sewing machines.  Hancock
Fabrics is one of the largest fabric retailers in the United
States, currently operating approximately 400 retail stores in
approximately 40 states.  The company employs approximately 7,500
people on a full-time and part-time basis.  Most of the company's
employees work in its retail stores, or in field management to
support its retail stores.

The company and 6 of its debtor-affiliates filed for chapter 11
protection on March 21, 2007 (Bankr. D. Del. Lead Case No.
07-10353).  Robert J. Dehney, Esq., at Morris, Nichols, Arsht &
Tunnell, represent the Debtors.  When the Debtors filed for
protection from their creditors, they listed $241,873,900 in total
assets and 161,412,000 in total liabilities.

The Debtors exclusive period to file a chapter 11 plan expires on
July 19, 2007.  (Hancock Fabric Bankruptcy News, Issue No. 12,
http://bankrupt.com/newsstand/or 215/945-7000).


HANCOCK FABRICS: Hancock Fabrics LLC Files Schedules
----------------------------------------------------
Hancock Fabrics LLC, Hancock Fabrics Inc.'s debtor-affiliate,
filed with the United States Bankruptcy Court for the District of
Delaware, its schedules of assets and liabilities, disclosing:

A.      Real Property                                        $0
B.      Personal Property
B.1     Cash on hand                                      5,175
B.2     Bank accounts
         Wells Fargo                                     29,123
         Wells Fargo                                     20,536
         Westamerica Bank                                17,672
         Others                                          23,126
B.3     Security Deposits                                     0
B.4     Household goods                                       0
B.5     Book, art work & collectibles                         0
B.6     Wearing apparel                                       0
B.7     Furs and jewelry                                      0
B.8     Firearms and sporting goods                           0
B.9     Interests in Insurance Policies                       0
B.10    Annuities                                             0
B.11    Interests in education IRA                            0
B.12    Interests in retirement plans                         0
B.13    Stock and Interests                                   0
B.14    Interests in joint ventures                           0
B.15    Government & corporate bonds                          0
B.16    Accounts receivable                                   0
B.17    Alimony                                               0
B.18    Other liquidated debts owed                           0
B.19    Equitable or future interests                         0
B.20    Contingent & contingent interests                     0
B.21    Other contingent & unliquidated claims                0
B.22    Patents, copyrights & trademarks                      0
B.23    Licenses & franchises                                 0
B.24    Other intangibles                                     0
B.25    Automobiles                                           0
B.26    Boats                                                 0
B.27    Aircraft                                              0
B.28    Office eqpt., furnishings and supplies                0
B.29    Machinery, furniture and fixtures
        Furniture, Fixtures & Equipment                 411,666
        Leasehold Improvements                           10,096
B.30    Inventory
        Pattern Inventory                               338,424
        Retail Inventory                              3,032,686
B.31    Animals                                               0
B.32    Crops                                                 0
B.33    Farming equipment                                     0
B.34    Farm supplies                                         0
B.35    Other personal property                               0

      TOTAL SCHEDULED ASSETS                         $3,888,504
                                                    ===========

C.      Property Claimed as Exempt               Not applicable

D.      Creditors Holding Secured Claims
        Wachovia Bank, NA                           $53,224,413
        Wachovia Bank, NA                             8,711,508
E.      Creditors Holding Unsecured
     Priority Claims
        Taxes
           Fresno County                                    214
           County of Santa Clara                            166
           Butte County Treasurer                           151
           Humboldt County                                  144
           Sacramento County                                146
           Others                                         1,958

F.      Creditors Holding Unsecured Claims
        Non-Priority Claims
           Redland-Branson Development                   25,473
           Cypress Group                                 39,679
           Hallaian Brother #1                           12,055
           Kohl's Department Store                       11,247
           Others                                       111,790

      TOTAL SCHEDULED LIABILITIES                   $62,138,944
                                                   ============

                      About Hancock Fabrics

Headquartered in Baldwyn, Miss., Hancock Fabrics Inc. (OTC: HKFIQ)
-- http://www.hancockfabrics.com/-- is a specialty retailer of a  
wide selection of fashion and home decorating textiles, sewing
accessories, needlecraft supplies and sewing machines.  Hancock
Fabrics is one of the largest fabric retailers in the United
States, currently operating approximately 400 retail stores in
approximately 40 states.  The company employs approximately 7,500
people on a full-time and part-time basis.  Most of the company's
employees work in its retail stores, or in field management to
support its retail stores.

The company and 6 of its debtor-affiliates filed for chapter 11
protection on March 21, 2007 (Bankr. D. Del. Lead Case No.
07-10353).  Robert J. Dehney, Esq., at Morris, Nichols, Arsht &
Tunnell, represent the Debtors.  When the Debtors filed for
protection from their creditors, they listed $241,873,900 in total
assets and 161,412,000 in total liabilities.

The Debtors exclusive period to file a chapter 11 plan expires on
July 19, 2007.  (Hancock Fabric Bankruptcy News, Issue No. 12,
http://bankrupt.com/newsstand/or 215/945-7000).


HANCOCK FABRICS: HF Merchandising Files Schedules
-------------------------------------------------
HF Merchandising, Hancock Fabrics Inc.'s debtor-affiliate, filed
with the United States Bankruptcy Court for the District of
Delaware, its schedules of assets and liabilities, disclosing:

A.      Real Property                                        $0
B.      Personal Property
B.29    Machinery, furniture and fixtures
         Furniture, Fixtures & Equipment              7,935,148
B.30    Inventory
         Retail Inventory                            14,168,577

      TOTAL SCHEDULED ASSETS                        $22,103,725
                                                   ============

C.      Property Claimed as Exempt               Not applicable

D.      Creditors Holding Secured Claims
         Wachovia Bank, NA                          $53,224,413
         Wachovia Bank, NA                            8,711,508
E.      Creditors Holding Unsecured
       Priority Claims
         Taxes                                                0
F.      Creditors Holding Unsecured Claims
         Non-Priority Claims
            HF Enterprises, Inc.                      7,836,597
            HF Resources, Inc.                       44,536,120

      TOTAL SCHEDULED LIABILITIES                  $114,308,638
                                                  =============

                      About Hancock Fabrics

Headquartered in Baldwyn, Miss., Hancock Fabrics Inc. (OTC: HKFIQ)
-- http://www.hancockfabrics.com/-- is a specialty retailer of a  
wide selection of fashion and home decorating textiles, sewing
accessories, needlecraft supplies and sewing machines.  Hancock
Fabrics is one of the largest fabric retailers in the United
States, currently operating approximately 400 retail stores in
approximately 40 states.  The company employs approximately 7,500
people on a full-time and part-time basis.  Most of the company's
employees work in its retail stores, or in field management to
support its retail stores.

The company and 6 of its debtor-affiliates filed for chapter 11
protection on March 21, 2007 (Bankr. D. Del. Lead Case No.
07-10353).  Robert J. Dehney, Esq., at Morris, Nichols, Arsht &
Tunnell, represent the Debtors.  When the Debtors filed for
protection from their creditors, they listed $241,873,900 in total
assets and 161,412,000 in total liabilities.

The Debtors exclusive period to file a chapter 11 plan expires on
July 19, 2007.  (Hancock Fabric Bankruptcy News, Issue No. 12,
http://bankrupt.com/newsstand/or 215/945-7000).


HANCOCK FABRICS: Hancock Fabrics of MI Files Schedules
------------------------------------------------------
Hancock Fabrics of MI, Hancock Fabrics Inc.'s debtor-affiliate,
has filed with the United States Bankruptcy Court for the District
of Delaware, its schedules of assets and liabilities, disclosing:

A.      Real Property                                        $0
B.      Personal Property
B.1     Cash on hand                                      2,750
B.2     Bank accounts
         Bank One                                         3,578
         Bank One                                         2,790
         Charter One                                      5,238
         Comerica                                        13,090
         Huntington National Bank                         2,112
         National City                                    3,066
B.25    Automobiles                                       5,213
B.29    Machinery, furniture and fixtures
         Furniture, Fixtures & Equipment                 66,454
         Leasehold Improvements                             781
B.30    Inventory
         Pattern Inventory                              169,212
         Retail Inventory                             1,489,733

      TOTAL SCHEDULED ASSETS                         $1,764,017
                                                    ===========

C.      Property Claimed as Exempt               Not applicable

D.      Creditors Holding Secured Claims
         Wachovia Bank, NA                          $53,224,413
         Wachovia Bank, NA                            8,711,508
E.      Creditors Holding Unsecured
      Priority Claims
         Taxes                                            1,371
F.      Creditors Holding Unsecured Claims
         Non-Priority Claims
            Harold L. Brander, J                         38,153
            Rubloff Development                           7,967
            Eleven-Dequindre Associates                   7,102
            Others                                       13,436

      TOTAL SCHEDULED LIABILITIES                   $62,003,950
                                                   ============

                      About Hancock Fabrics

Headquartered in Baldwyn, Miss., Hancock Fabrics Inc. (OTC: HKFIQ)
-- http://www.hancockfabrics.com/-- is a specialty retailer of a  
wide selection of fashion and home decorating textiles, sewing
accessories, needlecraft supplies and sewing machines.  Hancock
Fabrics is one of the largest fabric retailers in the United
States, currently operating approximately 400 retail stores in
approximately 40 states.  The company employs approximately 7,500
people on a full-time and part-time basis.  Most of the company's
employees work in its retail stores, or in field management to
support its retail stores.

The company and 6 of its debtor-affiliates filed for chapter 11
protection on March 21, 2007 (Bankr. D. Del. Lead Case No.
07-10353).  Robert J. Dehney, Esq., at Morris, Nichols, Arsht &
Tunnell, represent the Debtors.  When the Debtors filed for
protection from their creditors, they listed $241,873,900 in total
assets and 161,412,000 in total liabilities.

The Debtors exclusive period to file a chapter 11 plan expires on
July 19, 2007.  (Hancock Fabric Bankruptcy News, Issue No. 12,
http://bankrupt.com/newsstand/or 215/945-7000).


HANCOCK FABRICS: HF Resources Files Schedules of Assets & Debts
---------------------------------------------------------------
HF Resources Inc., Hancock Fabrics Inc.'s debtor-affiliate, has
filed with the United States Bankruptcy Court for the District of
Delaware, its schedules of assets and liabilities, disclosing:

A.      Real Property                                        $0
B.      Personal Property
B.1     Cash on hand                                          0
B.2     Bank accounts
         PNC Bank                                         1,708
         PNC Bank                                        15,578
B.13    Stock and Interests                        undetermined
B.16    Accounts receivable
         Due from Hancock Fabrics, Inc.             181,592,642
         Due from HF Merchandising, Inc.             44,536,120

      TOTAL SCHEDULED ASSETS                       $226,146,048
                                                  =============

C.      Property Claimed as Exempt               Not applicable

D.      Creditors Holding Secured Claims
         Wachovia Bank, NA                          $53,224,413
         Wachovia Bank, NA                            8,711,508
E.      Creditors Holding Unsecured
      Priority Claims
         Taxes                                                0
F.      Creditors Holding Unsecured Claims
         Non-Priority Claims                                  0

      TOTAL SCHEDULED LIABILITIES                   $61,935,921
                                                   ============

                      About Hancock Fabrics

Headquartered in Baldwyn, Miss., Hancock Fabrics Inc. (OTC: HKFIQ)
-- http://www.hancockfabrics.com/-- is a specialty retailer of a  
wide selection of fashion and home decorating textiles, sewing
accessories, needlecraft supplies and sewing machines.  Hancock
Fabrics is one of the largest fabric retailers in the United
States, currently operating approximately 400 retail stores in
approximately 40 states.  The company employs approximately 7,500
people on a full-time and part-time basis.  Most of the company's
employees work in its retail stores, or in field management to
support its retail stores.

The company and 6 of its debtor-affiliates filed for chapter 11
protection on March 21, 2007 (Bankr. D. Del. Lead Case No.
07-10353).  Robert J. Dehney, Esq., at Morris, Nichols, Arsht &
Tunnell, represent the Debtors.  When the Debtors filed for
protection from their creditors, they listed $241,873,900 in total
assets and 161,412,000 in total liabilities.

The Debtors exclusive period to file a chapter 11 plan expires on
July 19, 2007.  (Hancock Fabric Bankruptcy News, Issue No. 12,
http://bankrupt.com/newsstand/or 215/945-7000).


MORTGAGE LENDERS: Posts $7.9 Million Net Loss in May 2007
---------------------------------------------------------

             Mortgage Lenders Network USA, Inc.
                        Balance Sheet
                     As of May 31, 2007

Assets:
Cash and Cash Equivalents                         $17,464,140
Mortgage loans held for sale                          739,165
Portfolio loans                                             0
Allowance for loan losses                                   0
Capitalized Mortgage Servicing rights, net                  0
Retained interests in securitization,
   at fair value                                             0
Furniture, fixtures, equipment,
   an software, net                                  3,187,970
Deferred Costs                                              0
Principal & Interest Advances                         329,541
Interest in subsidiaries                                    0
Other Assets                                       10,575,255
                                                  ------------
   Total Assets                                    $32,296,071
                                                  ============

Liabilities:
Accounts Payable prepetition                      $14,473,859
Accounts Payable postpetition                         110,142
Accrued Expenses - Payroll                            989,811
Accrued Expenses - Other                           15,509,179
Warehouse Borrowings                               22,987,992
Convertible Debt                                    1,500,000
Servicing & Working Capital Advances               54,408,435
Capital Lease Liability                                 6,258
Other liabilities                                  31,248,741
                                                  ------------
   Total Liabilities                               141,234,417

Stockholders' Equity:
Common Stock                                          625,000
Additional Paid-In Capital                          1,829,770
Retained Earnings                                (110,552,116)
                                                  ------------
   Total Stockholders' Equity                     (108,097,346)
                                                  ------------
   Total Debts & Stockholders' Equity              $33,137,071
                                                  ============

* * * The Debtor notes that an $841,000 adjustment was made to
    Retained Earnings for the period ended May 31, 2007.  This
    adjustment was due to accrued taxes in 2006 that will not
    be paid.  As a result, the payable was reduced and the
    expense was reversed with a transaction date of Dec. 31,
    2006.

             Mortgage Lenders Network USA, Inc.
         Schedule of Cash Receipts and Disbursements
                  Month Ended May 31, 2007

Cash - Beginning of Month                             $286,713

Receipts:
Net Servicing Inflows                                 398,548
Warehouse and Loan Sale Inflows                       111,884
Sale of Fixed Assets                                  903,539
Sale of Other Assets                                4,256,260
Other Inflows                                       1,808,350

Transfers from Cash Collateral                              0
                                                  ------------
   Total Receipts                                    7,478,581

Disbursements:
Net Payroll                                           394,865
Payroll Taxes                                          45,703
Medical Coverage Sub/ FSA Witholding                    8,359
Operating Expenses                                    478,190
Rent                                                  133,032
Utilities                                                   0
Insurance                                                   0
Administrative & Selling                                    0
Other                                                       0

Professional Fees Escrow Account                      236,237
Professional Fees Paid                                      0
U.S. Trustee Fees                                           0
DIP Fees                                              (50,000)

Transfers to Cash Collateral                          600,000
                                                  ------------
   Total Disbursements                               1,846,386

   Net Cash Flow                                     5,632,195
                                                  ------------
Cash - End of Month                                 $5,918,908
                                                  ============

             Mortgage Lenders Network USA, Inc.
                      Income Statement
                  Month Ended May 31, 2007

Revenue
Gain on Sale - Subprime                           ($5,643,220)
Gain on Sale - SRP/MBS                             (2,807,823)
Mortgage origination income                               143
Net Warehouse interest income                        (511,834)
Servicing income, net                                 250,164
Other Income                                      (16,189,035)
                                                  ------------
   Total Revenues                                 ($24,901,606)
                                                  ------------

Expenses
Salaries                                             $299,138
Overtime/Temp Help                                      1,133
Bonus/Incentives                                            0
Benefits                                              493,575
Rent Expense                                        3,141,281
Telephone                                              13,465
Repairs & Maintenances                                 43,661
Office & Supplies Expense                              (1,584)
Postage/Express Mail                                   93,716
Service Bureau                                        205,224
Consulting Fees                                        35,595
Insurance                                             231,562
Loan Loss/Foreclosure Exp.                        (23,988,995)
Appraisal/Credit Expenses                                (368)
Travel & Entertainment                                 53,346
Meetings/Seminars/Education                            14,738
Membership Fes/Dues/Filings                         1,002,424
Advertising - Other                                    27,914
Interest Expense - Other                                1,250
Legal/Regulatory Expese                                43,146
Miscellaneous Expenses                                894,031
                                                  ------------
   Total Expenses Before Depreciation              (17,395,747)

   Depreciation Expense                                      0
                                                  ------------
   Net Profit Before Reorganization Items           (7,505,859)

Reorganization Items
Professional Fees
                                                  ------------
   Total Reorganization Items                          408,807

Income Taxes                                                0
                                                  ------------
Net Income (Loss)                                  ($7,914,666)
                                                  ============

During May 2007, the Debtor paid $409,519 in professional fees to
Scouler Andrews; $305,970 to Pachulski, Stang, Ziel, Young;
$152,014 to Blank Rome; $250,000 to Dechart.  Around $16,193 in
miscellaneous fees was also reported.

Since filing for bankruptcy, the Debtor has paid $1,388,654 to
Scouler Andrews, $405,970 to Pachulski, Stang, Ziel, Young,
$152,014 to Blank Rome, $57,701 to The Trumbull Group, and
$250,000 to Dechart.

                      About Mortgage Lenders

Middletown, Conn.-based Mortgage Lenders Network USA Inc. --
http://www.mlnusa.com/-- is a privately held company offering
a full range of Alt-A/Non-Conforming and Conforming loan products
through its retail and wholesale channels.  The company filed for
chapter 11 protection on Feb. 5, 2007 (Bankr. D. Del. Case No.
07-10146).  Pachulski Stang Ziehl Young Jones & Weintraub LLP
represents the Debtor.  Blank Rome LLP represents the Official
Committee of Unsecured Creditors.  In the Debtor's schedules of
assets and liabilities filed with the Court, it disclosed total
assets of $464,847,213 and total debts of $556,459,464.

The Debtor's exclusive period to file a chapter 11 plan expires on
Oct. 3, 2007.  (Mortgage Lenders Bankruptcy News, Issue No. 13;
Bankruptcy Creditors' Service Inc. http://bankrupt.com/newsstand/
or 215/945-7000).


MORTGAGE LENDERS: Posts $136 Million Net Loss in April 2007
-----------------------------------------------------------

             Mortgage Lenders Network USA, Inc.
                        Balance Sheet
                    As of April 30, 2007

Assets:
Cash and Cash Equivalents                        $17,091,406
Mortgage loans held for sale                      35,993,542
Portfolio loans                                   10,142,343
Allowance for loan losses                        (24,401,101)
Capitalized Mortgage Servicing rights, net                 0
Retained interests in securitization,
   at fair value                                            0
Furniture, fixtures, equipment,
   an software, net                                20,272,541
Deferred Costs                                             0
Principal & Interest Advances                      1,765,944
Interest in subsidiaries                               1,534
Other Assets                                      17,523,142
                                                 ------------
   Total Assets                                   $78,389,352
                                                 ============

Liabilities:
Accounts Payable prepetition                     $14,459,741
Accounts Payable postpetition                        385,503
Accrued Expenses - Payroll                         1,000,833
Accrued Expenses - Other                          18,235,530
Warehouse Borrowings                              56,144,324
Convertible Debt                                   1,500,000
Servicing & Working Capital Advances              54,408,435
Capital Lease Liability                                6,258
Other liabilities                                 32,431,409
                                                 ------------
   Total Liabilities                              178,572,032

Stockholders' Equity:
Common Stock                                         625,000
Additional Paid-In Capital                         1,829,770
Retained Earnings                               (102,637,450)
                                                 ------------
   Total Stockholders' Equity                    (100,182,680)
                                                 ------------
   Total Debts & Stockholders' Equity             $78,389,352
                                                 ============

             Mortgage Lenders Network USA, Inc.
         Schedule of Cash Receipts and Disbursements
                 Month Ended April 30, 2007

Cash - Beginning of Month                          $2,270,308

Receipts:
Net Servicing Inflows                                978,344
Warehouse and Loan Sale Inflows                       44,812
Sale of Fixed Assets                                       0
Sale of Other Assets                                 186,219
Other Inflows                                         22,395

Transfers from Cash Collateral                     2,000,000
                                                 ------------
   Total Receipts                                   3,231,770

Disbursements:
Net Payroll                                          465,792
Payroll Taxes                                         38,620
Medical Coverage Sub/ FSA Withholding                 10,108
Operating Expenses                                   106,319
Rent                                                 132,996
Utilities                                                  0
Insurance                                             43,243
Administrative & Selling                                   0
Other                                                      0
Professional Fees Escrow Account                   3,018,037
Professional Fees Paid                                     0
U.S. Trustee Fees                                        250
DIP Fees                                                   0
Transfers to Cash Collateral                       1,400,000
                                                 ------------
   Total Disbursements                              5,215,365

   Net Cash Flow                                   (1,983,595)
                                                 ------------
Cash - End of Month                                  $286,713
                                                 ============

             Mortgage Lenders Network USA, Inc.
                      Income Statement
                 Month Ended April 30, 2007

Revenue
Gain on Sale - Subprime                         ($41,475,327)
Gain on Sale - SRP/MBS                           (71,343,323)
Mortgage origination income                            7,128
Net Warehouse interest income                      4,730,993
Servicing income, net                             12,103,167
Other Income                                     (12,005,406)
                                                 ------------
   Total Revenues                               ($107,982,768)
                                                 ------------

Expenses
Salaries                                         $18,687,282
Overtime/Temp Help                                   222,035
Bonus/Incentives                                      (7,592)
Benefits                                             745,603
Rent Expense                                         696,193
Telephone                                            518,988
Repairs & Maintenances                               219,256
Office & Supplies Expense                            362,362
Postage/Express Mail                                 264,659
Service Bureau                                       947,551
Consulting Fees                                      875,630
Insurance                                             52,677
Loan Loss/Foreclosure Exp.                           148,780
Appraisal/Credit Expenses                            255,312
Travel & Entertainment                                81,369
Meetings/Seminars/Education                           40,444
Membership Fes/Dues/Filings                          344,575
Advertising - Other                                   92,855
Interest Expense - Other                             523,287
Legal/Regulatory Expese                              139,579
Miscellaneous Expenses                               777,952
                                                 ------------
   Total Expenses Before Depreciation              25,988,795

   Depreciation Expense                             1,143,563
                                                 ------------
   Net Profit Before Reorganization Items        (135,115,126)

Reorganization Items
Professional Fees                                  1,136,837
                                                 ------------
   Total Reorganization Items                       1,136,837

Income Taxes                                               0
                                                 ------------
Net Income (Loss)                               ($136,251,962)
                                                 ============

During April 2007, the Debtor paid $32,701 in professional fees to
The Trumbull Group.  Since filing for bankruptcy, the Debtor has
paid $979,135 to Scouler Andrews, $100,000 to Pachulski, Stang,
Ziel, Young, and $57,701 to The Trumbull Group.

                      About Mortgage Lenders

Middletown, Conn.-based Mortgage Lenders Network USA Inc. --
http://www.mlnusa.com/-- is a privately held company offering
a full range of Alt-A/Non-Conforming and Conforming loan products
through its retail and wholesale channels.  The company filed for
chapter 11 protection on Feb. 5, 2007 (Bankr. D. Del. Case No.
07-10146).  Pachulski Stang Ziehl Young Jones & Weintraub LLP
represents the Debtor.  Blank Rome LLP represents the Official
Committee of Unsecured Creditors.  In the Debtor's schedules of
assets and liabilities filed with the Court, it disclosed total
assets of $464,847,213 and total debts of $556,459,464.

The Debtor's exclusive period to file a chapter 11 plan expires on
Oct. 3, 2007.  (Mortgage Lenders Bankruptcy News, Issue No. 13;
Bankruptcy Creditors' Service Inc. http://bankrupt.com/newsstand/
or 215/945-7000).


MUSICLAND HOLDING: Posts $138,000 Net Loss in May 2007
------------------------------------------------------

                      Musicland Holding Corp.
                     Consolidated Balance Sheet
                         As of May 31, 2007

ASSETS
Current Assets
  Cash                                            $11,729,000
  Letters of Credit/Other Deposits                    415,000
  Other
     Amounts due from TransWorld                    1,300,000
     Receivables from Sub-leases                      774,000
     Amounts due from GOB sales                             -
     Miscellaneous CC                                  29,000
     Vendors Credit due from services               1,541,000
                                                -------------
     Total                                         15,788,000
                                                =============

Fixed Assets                                                0
Other assets
  Transport Logistic deposit                                -
  Insurance Deposits                                3,977,000
  Utility and Tax Deposits                                  -
                                                -------------
     TOTAL ASSETS                                 $19,765,000
                                                =============

Liabilities & Shareholders' deficit
Current liabilities
  Accounts payable
     Due to Transworld                                     $0
     Due to Deluxe                                          0
     Expense accruals                               2,840,000
  Other accrued liabilities
     Logistic Accrual                                       -
     Deferred Income                                        -
     Insurance Reserve                              3,380,000
     Accrued Payroll & Employee Benefits:
        Accrued Vacation                                    -
        Accrued Severance                                   -
        Accrued Employer Payroll Taxes                      -
        Accrued Benefits                                    -
     Sales Tax                                              -
     5% Admin. Fee on Wachovia L/C                    250,000
     FY06 Tax Return & Employee Benefit
        Audit Services                                      -
     Payroll/W2 & 1099 System                               -
     Miscellaneous                                     29,000
  Gift Card liabilities                                     0
                                                -------------
     Total                                          3,659,000
                                                -------------

DIP financing                                               0
Other LT Liabilities                                        0
Liabilities subject to compromise                 315,047,000
Shareholders' deficit                            (301,781,000)
                                                -------------
     TOTAL LIABILITIES &
     SHAREHOLDERS' DEFICIT                        $19,765,000
                                                =============

                      Musicland Holding Corp.
                      Statement of Operations
                   For the Month Ended May 31, 2007

Merchandise revenue                                         -
Non-merchandise revenue                                     -

  Net sales                                                 -

Cost of good sold                                           -

  Gross Profit                                              -

Store operating expenses
  Payroll                                                   -
  Occupancy                                                 -
  Other                                                $2,000
                                                -------------
     Store expenses                                         0
                                                -------------
General & administrative                                2,000
                                                -------------
EBITDA (Loss)                                           2,000

  Hilco 340 Store GOB                                       -
  Chapter 11 & related charges                       (200,000)
  Sale to Transworld                                        0
  Hilco 65                                                  0
  Media Play Wind down                                      0
  Depreciation & Amortization                               0
                                                -------------
     Operating income (Loss)                         (198,000)

  Interest income (expense)                            46,000
  Other non-operating charges                          14,000
                                                -------------
     Earnings before Taxes                           (138,000)
                                                -------------
  Income tax                                                0
                                                -------------
     Net earnings (Loss)                            ($138,000)
                                                =============

                      Musicland Holding Corp.
                      Statements of Cash Flow
                   For the Month Ended May 31, 2007

Operating activities
  Net earnings (Loss)                               ($138,000)
  Adjustments to reconcile net earnings (loss)
     to net cash provided by (used in)
     operating activities:
        Loss on utility deposits write off

  Changes in operating assets & liabilities:
     Inventory                                              -
     Other current assets                              59,000
     Other Non-current Assets                               -
     Accounts payable                                       -
     Other accrued liabilities                              -
                                                            -
     Liabilities subject to compromise                      -
                                                -------------
  Net cash provided by (used in)
     operating activities                             (79,000)
                                                -------------

Investing activities
  Change in other long term asset/liabilities               -
  Retirement of fixed assets                                -
     Net cash                                               -

Financing activities
  Distribution to Secured Creditors                         -
                                                -------------
Increase/decrease in cash                             (79,000)
                                                -------------
  Cash at the beginning of Period                  11,808,000
                                                -------------
  Cash at the end of Period                       $11,729,000
                                                =============

                   About Musicland Holding Corp.

Headquartered in New York City, Musicland Holding Corp., is a
specialty retailer of music, movies and entertainment-related
products.  The Debtor and 14 of its affiliates filed for chapter
11 protection on Jan. 12, 2006 (Bankr. S.D.N.Y. Lead Case No.
06-10064).  James H.M. Sprayregen, Esq., at Kirkland & Ellis,
represents the Debtors in their restructuring efforts.   Mark T.
Power, Esq., at Hahn & Hessen LLP, represents the Official
Committee of Unsecured Creditors.  At March 31, 2007, the Debtors
disclosed $20,121,000 in total assets and $321,546,000 in total
liabilities.

On May 12, 2006, the Debtors filed their Joint Plan of Liquidation
with the Court.  On Sept. 14, 2006, they filed an amended Plan and
a Second Amended Plan on Oct. 13, 2006.  The Court approved the
adequacy of the Amended Disclosure Statement on Oct. 13, 2006.  
(Musicland Bankruptcy News, Issue No. 33; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).


MUSICLAND HOLDING: Files April 2007 Operating Report
----------------------------------------------------

                     Musicland Holding Corp.
                    Consolidated Balance Sheet
                       As of April 30, 2007

ASSETS
Current Assets
Cash                                            $11,808,000
Letters of Credit/Other Deposits                    415,000
Other
    Amounts due from TransWorld                    1,300,000
    Receivables from Sub-leases                      774,000
    Amounts due from GOB sales                             -
    Miscellaneous CC                                  29,000
    Vendors Credit due from services               1,600,000
                                               -------------
    Total                                         15,926,000
                                               =============

Fixed Assets                                               0
Other assets
Transport Logistic deposit                                -
Insurance Deposits                                3,977,000
Utility and Tax Deposits                                  -
                                               -------------
    TOTAL ASSETS                                 $19,903,000
                                               =============

Liabilities & Shareholders' deficit
Current liabilities
Accounts payable
    Due to Transworld                                     $0
    Due to Deluxe                                          0
    Expense accruals                              $2,840,000
Other accrued liabilities
    Logistic Accrual                                       -
    Deferred Income                                        -
    Insurance Reserve                              3,380,000
    Accrued Payroll & Employee Benefits:
       Accrued Vacation                                    -
       Accrued Severance                                   -
       Accrued Employer Payroll Taxes                      -
       Accrued Benefits                                    -
    Sales Tax                                              -
    5% Admin. Fee on Wachovia L/C                    250,000
    FY06 Tax Return & Employee Benefit
       Audit Services                                      -
    Payroll/W2 & 1099 System                               -
  Miscellaneous                                       29,000
  Gift Card liabilities                                    0
                                                -------------
     Total                                          3,659,000
                                                -------------

DIP financing                                               0
Other LT Liabilities                                        0
Liabilities subject to compromise                 315,047,000
Shareholders' deficit                            (301,643,000)
                                                -------------
     TOTAL LIABILITIES &
     SHAREHOLDERS' DEFICIT                        $19,903,000
                                                =============

                      Musicland Holding Corp.
                      Statement of Operations
                   For the Month Ended April 30, 2007

Merchandise revenue                                         -
Non-merchandise revenue                                     -

  Net sales                                                 -

Cost of good sold                                           -

  Gross Profit                                              -

Store operating expenses
  Payroll                                                   -
  Occupancy                                                 -
  Other                                              ($16,000)
                                                -------------
     Store expenses                                         0
                                                -------------
General & administrative                              (16,000)
                                                -------------
EBITDA (Loss)                                         (16,000)

  Hilco 340 Store GOB                                       -
  Chapter 11 & related charges                       (343,000)
  Sale to Transworld                                        0
  Hilco 65                                                  0
  Media Play Wind down                                      0
  Depreciation & Amortization                               0
                                                -------------
     Operating income (Loss)                         (359,000)

  Interest income (expense)                            45,000
  Other non-operating charges                          96,000
                                                -------------
     Earnings before Taxes                           (218,000)
                                                -------------
  Income tax                                                0
                                                -------------
     Net earnings (Loss)                            ($218,000)
                                                =============

                      Musicland Holding Corp.
                      Statements of Cash Flow
                   For the Month Ended April 30, 2007

Operating activities
  Net earnings (Loss)                               ($218,000)
  Adjustments to reconcile net earnings (loss)
     to net cash provided by (used in)
     operating activities:
        Loss on utility deposits write off

  Changes in operating assets & liabilities:
     Inventory                                              -
     Other current assets                                   -
     Other Non-current Assets                               -
     Accounts payable                                       -
     Other accrued liabilities                              -
                                                            -
     Liabilities subject to compromise                      -
                                                -------------
  Net cash provided by (used in)
     operating activities                            (218,000)
                                                -------------

Investing activities
  Change in other long term asset/liabilities               -
  Retirement of fixed assets                                -
     Net cash                                               -

Financing activities
  Distribution to Secured Creditors                         -
                                                -------------
Increase/decrease in cash                            (218,000)
                                                -------------
  Cash at the beginning of Period                  12,026,000
                                                -------------
  Cash at the end of Period                       $11,808,000
                                                =============

                  About Musicland Holding Corp.

Headquartered in New York City, Musicland Holding Corp., is a
specialty retailer of music, movies and entertainment-related
products.  The Debtor and 14 of its affiliates filed for chapter
11 protection on Jan. 12, 2006 (Bankr. S.D.N.Y. Lead Case No.
06-10064).  James H.M. Sprayregen, Esq., at Kirkland & Ellis,
represents the Debtors in their restructuring efforts.   Mark T.
Power, Esq., at Hahn & Hessen LLP, represents the Official
Committee of Unsecured Creditors.  At March 31, 2007, the Debtors
disclosed $20,121,000 in total assets and $321,546,000 in total
liabilities.

On May 12, 2006, the Debtors filed their Joint Plan of Liquidation
with the Court.  On Sept. 14, 2006, they filed an amended Plan and
a Second Amended Plan on Oct. 13, 2006.  The Court approved the
adequacy of the Amended Disclosure Statement on Oct. 13, 2006.  
(Musicland Bankruptcy News, Issue No. 33; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000

                             *********

Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par.  Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable.  Those sources may not,
however, be complete or accurate.  The Monday Bond Pricing table
is compiled on the Friday prior to publication.  Prices reported
are not intended to reflect actual trades.  Prices for actual
trades are probably different.  Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind.  It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.

Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets.  At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.  
Don't be fooled.  Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets.  A company may establish reserves on its balance sheet for
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equity securities trade in public market are determined by more
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A list of Meetings, Conferences and Seminars appears in each
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On Thursdays, the TCR delivers a list of recently filed chapter 11
cases involving less than $1,000,000 in assets and liabilities
delivered to nation's bankruptcy courts.  The list includes links
to freely downloadable images of these small-dollar petitions in
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Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals.  All titles are
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Monthly Operating Reports are summarized in every Saturday edition
of the TCR.

For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911.  For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.

                             *********

S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter is a daily newsletter co-published
by Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland,
USA.  Marie Therese V. Profetana, Shimero R. Jainga, Ronald C. Sy,
Joel Anthony G. Lopez, Cecil R. Villacampa, Jason A. Nieva,
Melanie C. Pador, Ludivino Q. Climaco, Jr., Loyda I. Nartatez,
Tara Marie A. Martin, John Paul C. Canonigo, Sheena Jusay, and
Peter A. Chapman, Editors.

Copyright 2007.  All rights reserved.  ISSN: 1520-9474.

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
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herein is obtained from sources believed to be reliable, but is
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The TCR subscription rate is $775 for 6 months delivered via e-
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for the term of the initial subscription or balance thereof are
$25 each.  For subscription information, contact Christopher Beard
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                    *** End of Transmission ***