<PAGE>   1

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                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                            ------------------------

                                   FORM 10-Q

                QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                   FOR THE THREE MONTHS ENDED MARCH 31, 2000
                           COMMISSION FILE NO. 0-8841

                            ------------------------

                            THE PIONEER GROUP, INC.
             (exact name of registrant as specified in its charter)

                            ------------------------

                  DELAWARE                                        13-5657669
      (State or other jurisdiction of                           (IRS Employer
       incorporation or organization)                        Identification No.)

   60 STATE STREET, BOSTON, MASSACHUSETTS                           02109
  (Address of principal executive offices)                        (Zip Code)


                                  617-742-7825
              (Registrant's telephone number, including area code)

                                   NO CHANGES
   (Former name, former address and former fiscal year, if changes since last
                                    report)

                            ------------------------

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

                            ------------------------

 As of March 31, 2000, there were 26,792,944 shares of the Registrant's Common
            Stock, $.10 par value per share, issued and outstanding.

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<PAGE>   2

                        PART I -- FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

                    THE PIONEER GROUP, INC. AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS
                 (DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNT)

<TABLE>
<CAPTION>
                                                               MARCH 31,    DECEMBER 31,
                                                                 2000           1999
                                                              -----------   ------------
                                                              (UNAUDITED)
<S>                                                           <C>           <C>
                                         ASSETS
CURRENT ASSETS:
Cash and cash equivalents, at cost which approximates fair
  value.....................................................   $ 33,912       $ 36,740
Restricted cash.............................................         13             99
Investment in marketable securities, at fair value..........      3,343          3,850
Receivables:
    From securities brokers and dealers for sales of mutual
     fund shares............................................     11,898          9,429
    From Pioneer Family of Mutual Funds.....................     20,406         20,610
    For securities sold.....................................         47            194
    Income taxes............................................     14,167             --
    Other...................................................      8,898          8,022
Timber inventory............................................      7,061          3,908
Other current assets........................................      8,769          9,749
                                                               --------       --------
        Total current assets................................    108,514         92,601
                                                               --------       --------
NONCURRENT ASSETS:
Cost of acquisition in excess of net assets (net of
  accumulated amortization of $14,282 in 2000 and $13,842 in
  1999).....................................................     14,349         14,539
Long-term venture capital investments, at fair value (cost
  $55,176 in 2000 and $55,504 in 1999)......................     50,765         51,093
Long-term investments, at lower of cost or fair value.......      8,177          6,712
Timber operations:
  Timber equipment and facilities (net of accumulated
    depreciation of $13,674 in 2000 and $6,231 in 1999).....     12,482         19,496
  Deferred timber development costs (net of accumulated
    amortization of $10,893 in 2000 and $2,279 in 1999).....         --          8,609
Building (net of accumulated depreciation of $2,172 in 2000
  and $1,990 in 1999).......................................     24,690         24,559
Furniture, equipment, and leasehold improvements (net of
  accumulated depreciation and amortization of $19,105 in
  2000 and $17,646 in 1999).................................     16,560         17,266
Other noncurrent assets.....................................     21,850         26,633
Net noncurrent assets of discontinued operations............     18,270         38,324
                                                               --------       --------
        Total noncurrent assets.............................    167,143        207,231
                                                               --------       --------
                                                               $275,657       $299,832
                                                               ========       ========
                          LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Payable to funds for shares sold............................   $ 11,896       $  9,420
Accounts payable............................................      8,077          5,832
Accrued expenses............................................     28,639         22,023
Brokerage liabilities.......................................        125            265
Accrued income taxes........................................      8,262          6,899
Distribution and service fees due to brokers and dealers....      8,911          9,043
Current portion of notes payable............................     16,343          1,343
Net current liabilities of discontinued operations..........     16,247         31,815
                                                               --------       --------
        Total current liabilities...........................     98,500         86,640
                                                               --------       --------
NONCURRENT LIABILITIES:
Notes payable, net of current portion.......................     23,867         63,892
                                                               --------       --------
        Total noncurrent liabilities........................     23,867         63,892
                                                               --------       --------
        Total liabilities...................................    122,367        150,532
                                                               --------       --------
Minority interest...........................................     62,358         62,202
                                                               --------       --------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
    Common stock, $0.10 par value; authorized 60,000,000
     shares; issued 26,807,148 shares in 2000 and 26,532,064
     shares in 1999.........................................      2,681          2,653
    Paid-in capital.........................................     50,397         47,372
    Retained earnings.......................................     52,102         50,044
    Treasury stock at cost, 14,204 shares in 2000 and 50,885
     shares in 1999.........................................       (402)        (1,804)
    Cumulative translation adjustment.......................     (3,989)        (3,943)
                                                               --------       --------
                                                                100,789         94,322
                                                               --------       --------
    Less -- Deferred cost of restricted common stock
     issued.................................................     (9,857)        (7,224)
                                                               --------       --------
        Total stockholders' equity..........................     90,932         87,098
                                                               --------       --------
                                                               $275,657       $299,832
                                                               ========       ========
</TABLE>

  The Company's Annual Report on Form 10-K should be read in conjunction with
                          these financial statements.
                                        2
<PAGE>   3

                    THE PIONEER GROUP, INC. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF OPERATIONS
                (DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                                 THREE MONTHS ENDED
                                                                      MARCH 31,
                                                              -------------------------
                                                                 2000          1999
                                                              -----------   -----------
<S>                                                           <C>           <C>
Revenues and sales:
    Investment management fees..............................  $    39,393   $    35,275
    Underwriting commissions and distribution fees..........        3,092         4,090
    Shareholder services fees...............................       11,108        11,085
    Revenues from brokerage activities......................           --           215
    Trustee fees and other income...........................        6,053         7,094
                                                              -----------   -----------
    Revenues from financial services businesses.............       59,646        57,759
    Timber sales............................................           --            --
                                                              -----------   -----------
         Total revenues and sales...........................       59,646        57,759
                                                              -----------   -----------
Costs and expenses:
    Management, distribution, shareholder service and
      administrative expenses...............................       51,197        50,213
    Timber operating costs and expenses.....................        1,552           362
                                                              -----------   -----------
         Total costs and expenses...........................       52,749        50,575
                                                              -----------   -----------
Other (income) expenses:
    Reduction in carrying value of timber assets............       15,300            --
    Unrealized and realized (gains) losses on venture
      capital and marketable
       securities investments, net..........................       (1,549)        3,292
    Equity in losses of affiliated companies................        1,232         2,178
    Interest expense........................................        1,867         2,227
                                                              -----------   -----------
         Total other expenses...............................       16,850         7,697
                                                              -----------   -----------
Loss from continuing operations before provision (benefit)
  for income taxes and minority interest....................       (9,953)         (513)
                                                              -----------   -----------
Provision (benefit) for income taxes........................      (12,167)          675
                                                              -----------   -----------
Income (loss) from continuing operations before minority
  interest..................................................        2,214        (1,188)
                                                              -----------   -----------
Minority interest...........................................          156         1,216
                                                              -----------   -----------
Net income (loss) from continuing operations before
  cumulative effect of
  change in accounting principle............................        2,058        (2,404)
Loss from discontinued operations...........................           --        (6,044)
Cumulative effect of change in accounting principle,
  (start-up costs, net
  of income taxes of $261)..................................           --       (12,112)
                                                              -----------   -----------
Net income (loss)...........................................  $     2,058   $   (20,560)
                                                              ===========   ===========
Basic earnings (loss) per share:
    Continuing operations...................................  $      0.08   $     (0.09)
    Discontinued operations.................................           --         (0.24)
    Cumulative effect of change in accounting principle.....           --         (0.47)
                                                              -----------   -----------
         Total basic earnings (loss) per share..............  $      0.08   $     (0.80)
                                                              ===========   ===========
Diluted earnings (loss) per share:
    Continuing operations...................................  $      0.08   $     (0.09)
    Discontinued operations.................................           --         (0.24)
    Cumulative effect of change in accounting principle.....           --         (0.47)
                                                              -----------   -----------
         Total diluted earnings (loss) per share............  $      0.08   $     (0.80)
                                                              ===========   ===========
Dividends per share.........................................  $        --   $        --
                                                              ===========   ===========
Basic shares outstanding....................................   26,211,000    25,791,000
                                                              ===========   ===========
Diluted shares outstanding..................................   26,588,000    25,791,000
                                                              ===========   ===========
</TABLE>

  The Company's Annual Report on Form 10-K should be read in conjunction with
                          these financial statements.
                                        3
<PAGE>   4

                    THE PIONEER GROUP, INC. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                             (DOLLARS IN THOUSANDS)
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                                  THREE MONTHS
                                                                ENDED MARCH 31,
                                                              --------------------
                                                                2000        1999
                                                              --------    --------
<S>                                                           <C>         <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
 Net income (loss)..........................................  $  2,058    $(20,560)
 Less net loss of discontinued operations...................        --      (6,044)
 Less cumulative effect of change in accounting principle...        --     (12,112)
                                                              --------    --------
 Net income (loss) from continuing operations...............  $  2,058    $ (2,404)
 Adjustments to reconcile net income (loss) to net cash
   provided by operating activities:
   Depreciation and amortization............................     3,650       3,956
   Reduction in carrying value of timber assets.............    15,300          --
   Unrealized and realized (gains) losses on venture
     capital, marketable securities, and long term
     investments, net.......................................    (1,549)      3,326
   Equity in (earnings) losses of affiliated companies......     1,232       2,178
   Restricted stock plan expense............................       915         855
   Deferred income taxes....................................     1,555      (4,516)
   Minority interest........................................       156       1,215
 Changes in operating assets and liabilities:
   Investments in marketable securities, net................       578       1,148
   Receivable from securities brokers and dealers for sales
     of mutual fund shares..................................    (2,469)     (2,005)
   Receivables for securities sold..........................       147         184
   Receivables from Pioneer Family of Mutual Funds and
     other..................................................      (681)      4,980
   Income tax refund receivable.............................   (14,167)         --
   Timber inventory.........................................    (3,153)     (3,656)
   Other current assets.....................................       530         529
   Other noncurrent assets..................................     1,710        (426)
   Payable to funds for shares sold.........................     2,476       2,010
   Accrued expenses and accounts payable....................     8,729       4,256
   Brokerage liabilities....................................      (140)     (1,989)
   Accrued income taxes.....................................     1,700     (13,206)
                                                              --------    --------
       Total adjustments and changes in operating assets and
       liabilities..........................................    16,519      (1,161)
                                                              --------    --------
       Net cash provided by (used in) continuing operating
       activities...........................................    18,577      (3,565)
                                                              --------    --------
       Net cash provided by (used in) discontinued operating
       activities...........................................    14,938        (836)
                                                              --------    --------
       Net cash provided by (used in) operating
       activities...........................................    33,515      (4,401)
                                                              --------    --------
CASH FLOWS FROM INVESTING ACTIVITIES:
 Additions to furniture, equipment and leasehold
   improvements.............................................    (1,308)     (1,557)
 Building...................................................      (140)        408
 Long-term venture capital investments......................        --        (884)
 Proceeds from sale of long-term venture capital
   investments..............................................       328         742
 Proceeds from sale of domestic venture capital
   operations...............................................        --      34,945
 Other investments..........................................       223         362
 Deferred timber development costs..........................        (5)        (47)
 Timber equipment and facilities............................      (429)       (720)
 Cost of acquisition in excess of net assets acquired.......      (250)         --
 Deconsolidation of pension company subsidiary..............        --      (9,634)
 Purchase of long-term investments..........................    (1,805)         --
 Proceeds from sale of long-term investments................     1,818         135
                                                              --------    --------
       Net cash provided by (used in) continuing investing
       activities...........................................    (1,568)     23,750
                                                              --------    --------
       Net cash used in investing activities, discontinued
       operations...........................................        --      (2,552)
                                                              --------    --------
       Net cash provided by (used in) investing
       activities...........................................    (1,568)     21,198
                                                              --------    --------
CASH FLOWS FROM FINANCING ACTIVITIES:
 Liquidation of venture capital partnership.................        --      (1,972)
 Distributions to limited partners of venture capital
   subsidiary...............................................        --      (1,288)
 Sale of stock by subsidiary................................        --         555
 Exercise of stock options..................................       546         180
 Restricted stock plan award................................        24          16
 Dealer advances............................................        63          --
 Revolving credit agreement (repayments) borrowings, net....   (25,000)    (30,000)
 Repayments of notes payable................................       (25)     (4,290)
 Reclassification of restricted cash........................        86         961
                                                              --------    --------
       Net cash used in continuing financing activities.....   (24,306)    (35,838)
                                                              --------    --------
       Net cash used in financing activities, discontinued
       operations...........................................   (10,452)     (1,939)
                                                              --------    --------
       Net cash used in financing activities................   (34,758)    (37,777)
                                                              --------    --------
EFFECT OF FOREIGN CURRENCY EXCHANGE RATE CHANGES ON CASH AND
 CASH EQUIVALENTS...........................................       (17)       (536)
NET DECREASE IN CASH AND CASH EQUIVALENTS...................    (2,828)    (21,516)
                                                              --------    --------
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD............    36,740      44,212
                                                              --------    --------
CASH AND CASH EQUIVALENTS AT END OF PERIOD..................  $ 33,912    $ 22,696
                                                              ========    ========
</TABLE>

  The Company's Annual Report on Form 10-K should be read in conjunction with
                          these financial statements.
                                        4
<PAGE>   5

                    THE PIONEER GROUP, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                                 MARCH 31, 2000

NOTE 1 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     The accounting and reporting policies of the Company conform to generally
accepted accounting principles. The Company has not changed any of its principal
accounting policies from those stated in the Annual Report on Form 10-K for the
year ended December 31, 1999. The footnotes to the financial statements reported
in the 1999 Annual Report on Form 10-K are incorporated herein by reference,
except to the extent that any such footnote is updated by the following:

     Certain reclassifications have been made to the accompanying 1999
consolidated financial statements to conform with the 2000 presentation.

     During the first quarter of 1999, the Company adopted the provisions of the
American Institute of Certified Public Accountants (the "AICPA") SOP 98-5,
"Reporting on the Costs of Start-Up Activities." SOP 98-5 requires that costs of
start-up activities be expensed as incurred. The Company had capitalized certain
pre-operating costs in connection with capitalized organizational costs
associated with its financial services operations and its natural resource
operations. Adoption of SOP 98-5 resulted in write-offs of $12.1 million, or
$0.47 per share, which is reflected in the accompanying consolidated financial
statements as a change in accounting principle.

     In the second quarter of 1999, the Company sold newly issued shares of its
Polish pension company subsidiary resulting in a 30% interest for $20 million.
In connection with the sale, the Company deconsolidated the Polish pension
company as control is shared. The Company is accounting for its investment in
the pension company under the equity method retroactive to January 1, 1999. The
effect of this transaction is reflected in the accompanying Consolidated
Statements of Cash Flows as deconsolidation of pension company subsidiary.

     Interest paid was $1,740,000 and $2,482,000 for the three months ended
March 31, 2000 and 1999, respectively. Income taxes refunded were $8,419,000 for
the three months ended March 31, 2000. Income taxes paid were $16,572,000 for
the three months ended March 31, 1999.

                                        5
<PAGE>   6

NOTE 2 -- EARNINGS PER SHARE

     The following table details the calculation of basic and diluted earnings
per share ("EPS"). Basic EPS is computed by dividing reported earnings available
to stockholders by weighted average shares outstanding not including
contingently issuable shares. Diluted EPS includes the effect of the
contingently issuable shares and other common stock equivalents, if not
antidilutive.

<TABLE>
<CAPTION>
                                                   NET                  EARNINGS/
                                                 INCOME/                  (LOSS)
                                                 (LOSS)      SHARES     PER SHARE
                                                ---------    -------    ----------
                                                 (DOLLARS AND SHARES IN THOUSANDS
                                                    EXCEPT PER SHARE AMOUNTS)
<S>                                             <C>          <C>        <C>
FOR THE THREE MONTHS ENDED 3/31/00
Basic earnings per share calculation:
Continuing operations.........................  $  2,058     26,211       $ 0.08
Discontinued operations.......................  $     --     26,211       $   --
                                                --------     ------       ------
          Total...............................  $  2,058     26,211       $ 0.08
                                                ========     ======       ======
Options.......................................                  315
Restricted stock..............................                   62
                                                             ------
Diluted earnings per share calculation:
Continuing operations.........................  $  2,058     26,588       $ 0.08
Discontinued operations.......................  $     --     26,588       $   --
                                                --------     ------       ------
          Total...............................  $  2,058     26,588       $ 0.08
                                                ========     ======       ======
FOR THE THREE MONTHS ENDED 3/31/99
Basic earnings per share calculation:
Continuing operations.........................  $ (2,404)    25,791       $(0.09)
Discontinued operations.......................  $ (6,044)    25,791       $(0.24)
Cumulative effect of change in
  accounting principle........................  $(12,112)    25,791       $(0.47)
                                                --------     ------       ------
          Total...............................  $(20,560)    25,791       $(0.80)
                                                ========     ======       ======
Options.......................................                   --
Restricted stock..............................                   --
Diluted earnings per share calculation:
Continuing operations.........................  $ (2,404)    25,791       $(0.09)
Discontinued operations.......................  $ (6,044)    25,791       $(0.24)
Cumulative effect of change in
  accounting principle........................  $(12,112)    25,791       $(0.47)
                                                --------     ------       ------
          Total...............................  $(20,560)    25,791       $(0.80)
                                                ========     ======       ======
</TABLE>

NOTE 3 -- COMPREHENSIVE INCOME

     SFAS 130, "Reporting Comprehensive Income" establishes standards for the
reporting of comprehensive income and its components. Comprehensive income, as
defined, includes all changes in equity during a period from non-owner sources.
The Company's foreign currency translation adjustments, which are excluded from

                                        6
<PAGE>   7

net income, are included in comprehensive income. The following table reports
comprehensive income for the three months ended March 31, 2000 and 1999.

<TABLE>
<CAPTION>
                                                         THREE MONTHS ENDED
                                                             MARCH 31,
                                                       ----------------------
                                                        2000           1999
                                                       ------        --------
                                                       (DOLLARS IN THOUSANDS)
<S>                                                    <C>           <C>
Net income (loss)....................................  $2,058        $(20,560)
Other comprehensive expense:
  Foreign currency translation adjustments...........     (46)           (962)
                                                       ------        --------
Other comprehensive expense..........................     (46)           (962)
                                                       ------        --------
Comprehensive income (loss)..........................  $2,012        $(21,522)
                                                       ======        ========
</TABLE>

NOTE 4 -- NET CAPITAL

     As a broker-dealer, Pioneer Funds Distributor, Inc. ("PFD") is subject to
the Securities and Exchange Commission's ("SEC") regulations and operating
guidelines which, among other things, requires PFD to maintain a specified
amount of net capital. Net capital may fluctuate on a daily basis. PFD's net
capital, as computed under Rule 15c3-1, was $1,003,324 at March 31, 2000, which
exceeded required net capital of $250,000 by $753,324.

     PFD is exempt from the reserve requirements of Rule 15c3-3, since its U.S.
broker-dealer transactions are limited to the purchase, sale and redemption of
redeemable securities of registered investment companies. All customer funds are
promptly transmitted and all securities received in connection with activities
as a broker-dealer are promptly delivered. PFD does not otherwise hold funds or
securities for, or owe money or securities to, customers.

NOTE 5 -- NOTES PAYABLE

     Notes payable of the Company consist of the following:

<TABLE>
<CAPTION>
                                                              MARCH 31,   DECEMBER 31,
                                                                2000          1999
                                                              ---------   ------------
                                                               (DOLLARS IN THOUSANDS)
<S>                                                           <C>         <C>
Revolving Credit Agreement..................................   $15,000      $40,000
Senior note payable to a commercial lender, principal
  payable on August 15, 2004, interest payable at 8.95%.....    20,000       20,000
Note payable to a bank, interest and principal payable
  monthly at the one-month Warsaw Bank rate plus 1.75%
  through August 2002.......................................       250          275
Project financing, guaranteed by OPIC, payable in semiannual
  installments of $620,000 through December 15, 2003,
  interest payable at 9.95%.................................     4,960        4,960
                                                               -------      -------
                                                                40,210       65,235
                                                               -------      -------
Less: Current portion.......................................   (16,343)      (1,343)
                                                               -------      -------
                                                               $23,867      $63,892
                                                               =======      =======
</TABLE>

                                        7
<PAGE>   8

     Maturities of notes payable at March 31, 2000, or each of the next five
years and thereafter are as follows (dollars in thousands):

<TABLE>
<S>                                                           <C>
4/1/00-3/31/01..............................................  $16,343
4/1/01-3/31/02..............................................    1,343
4/1/02-3/31/03..............................................    1,284
4/1/03-3/31/04..............................................    1,240
4/1/04-3/31/05..............................................   20,000
Thereafter..................................................       --
                                                              -------
                                                              $40,210
                                                              =======
</TABLE>

     At March 31, 2000, the Company had $8 million of debt attributable to its
discontinued gold mining operations. Scheduled debt service for the remainder of
2000 is expected to aggregate $3.9 million, of which $3.3 million represents
principal payments.

     In 1996, the Company entered into an agreement with a syndicate of
commercial banks for a senior credit facility that has been amended from time to
time (the "Credit Facility"). Under the Credit Facility, the Company may borrow
up to $55 million for general corporate purposes (the "Corporate Revolver"). The
Corporate Revolver is payable in full in March 2001. The Credit Facility
requires that the Company meet certain financial covenants including covenants
that require the Company to maintain certain minimum ratios with respect to debt
to cash flow and interest payments to cash flow, and a minimum tangible net
worth, all as defined in the Credit Facility. As of March 31, 2000, the Company
was in compliance with all applicable covenants and had $15 million outstanding
under the Corporate Revolver. Subsequent to March 31, 2000, the Company paid off
the $15 million in Corporate Revolver borrowings.

     In January 2000, the Company unwound $20 million of overhedged swaps and
recognized $33,000 of income on the transaction. As of March 31, 2000, the
Company had a five-year interest rate swap agreement with a member of the
Company's banking syndicate which has effectively fixed the interest rate on
notional amounts totaling $15 million. Under the agreement, the Company will pay
the bank a weighted average fixed rate of 6.90% on the notional principal. The
bank will pay the Company interest on the notional principal at the current
variable rate stated under the swap agreement. The Company has incurred
approximately $49,000 and $401,000 of interest expense on its swap agreements
during the three months ended March 31, 2000 and 1999, respectively. At March
31, 2000, the fair value of the outstanding swap was an obligation of $82,000,
compared to a book value of $0. If the Company were to terminate the swap
agreement, it would be required to pay an amount approximating fair value at the
time of termination.

     For the three months ended March 31, 2000 and 1999, the weighted average
interest rate on the borrowings under the Credit Facility and Note Agreement was
9.68% and 8.31%, respectively.

NOTE 6 -- DISCONTINUED OPERATIONS

     In the second quarter of 1999, the Company reflected the gold mining
segment as a discontinued operation. The gold mining segment consists of Pioneer
Goldfields Ltd. ("PGL"), and its 90% owned Ghanaian operating subsidiary,
Teberebie Goldfields Ltd. ("TGL"), and Closed Joint-Stock Company "Tas-Yurjah
Mining Company," the Company's majority owned (95%) Russian subsidiary. The
Company engaged the services of an investment banking firm to sell PGL,
including its African exploration rights and its interest in TGL. The Company
continues to actively negotiate a possible sale, although it can provide no
assurance that a sale will occur. Regardless of whether a sale is consummated or
not, it is proceeding with an orderly closure of the mine. All mining operations
ceased at the end of 1999, and all processing activities will be completed by
the end of the first half of 2000.

     The Company also reflected its powdered metals business as a discontinued
operation in the second quarter of 1999.

                                        8
<PAGE>   9

     The following is an unaudited summary of losses from operations of the gold
mining and powdered metals segments for the three months ended March 31, 2000
and 1999, respectively:

<TABLE>
<CAPTION>
                                                                 THREE MONTHS ENDED
                                                                   MARCH 31, 2000
                                                            -----------------------------
                                                            NET INCOME    EARNINGS/(LOSS)
                                                             /(LOSS)         PER SHARE
                                                            ----------    ---------------
                                                            (DOLLARS IN THOUSANDS EXCEPT
                                                                 PER SHARE AMOUNTS)
<S>                                                         <C>           <C>
Loss from operations of discontinued gold mining
  segment.................................................   $    --          $   --
                                                             -------          ------
Total loss from discontinued operations...................   $    --          $   --
                                                             =======          ======
</TABLE>

<TABLE>
<CAPTION>
                                                                 THREE MONTHS ENDED
                                                                   MARCH 31, 1999
                                                            -----------------------------
                                                            NET INCOME    EARNINGS/(LOSS)
                                                             /(LOSS)         PER SHARE
                                                            ----------    ---------------
                                                            (DOLLARS IN THOUSANDS EXCEPT
                                                                 PER SHARE AMOUNTS)
<S>                                                         <C>           <C>
Loss from operations of discontinued gold mining segment,
  net of taxes of ($175)..................................   $(5,923)         $(0.23)
Loss from operations of discontinued powdered metals
  business, net of taxes of ($24).........................      (121)          (0.01)
                                                             -------          ------
          Total losses from discontinued operations.......   $(6,044)         $(0.24)
                                                             =======          ======
</TABLE>

     The following is an unaudited summary of the results of discontinued gold
mining operations for the three months ended March 31, 2000 and 1999,
respectively:

<TABLE>
<CAPTION>
                                                    THREE MONTHS ENDED   THREE MONTHS ENDED
                                                      MARCH 31, 2000       MARCH 31, 1999
                                                    ------------------   ------------------
                                                         (AMOUNTS             (AMOUNTS
                                                      IN THOUSANDS)        IN THOUSANDS)
<S>                                                 <C>                  <C>
Revenues from gold mining activities..............       $11,131              $19,976
                                                         -------              -------
Loss before income taxes and minority interest....            --               (6,671)
Income tax benefit................................            --                 (175)
                                                         -------              -------
Loss before minority interest.....................            --               (6,496)
Minority interest.................................            --                 (573)
                                                         -------              -------
Loss from discontinued gold mining operations.....       $    --              $(5,923)
                                                         =======              =======
</TABLE>

     The results of discontinued gold mining operations for the three months
ended March 31, 1999 included an allocation of directly attributable corporate
interest expenses of $305,000. No corporate interest expense was allocated for
the three months ended March 31, 2000. Interest had been previously allocated
based upon the intercompany financing provided to the gold mining operations.

NOTE 7 -- TIMBER OPERATIONS

     The timber segment's operating results included both income from U.S. tax
benefits of approximately $15.1 million and the application of those tax
benefits to reduce the carrying value of the Company's timber assets. The
income, which is reflected on the Consolidated Statements of Operations as a
credit to tax expense, represented realization in the U.S. of previously
unrecognized foreign losses. In connection with the realization of the income
tax benefits, the Company recorded a corresponding reduction in the carrying
value of timber equipment and facilities and deferred development costs. The tax
benefits were largely collected in April 2000 and used to repay bank debt.

NOTE 8 -- FINANCIAL INFORMATION BY BUSINESS SEGMENT

     In accordance with SFAS 131, "Disclosures about Segments of an Enterprise
and Related Information" the Company presents segment information using the
management approach. The management approach is based on the way that management
organizes the segments within a Company for making operating decisions and
assessing performance. The Company's operating segments are organized around
services and products provided, as well as geographic regions. The intersegment
transactions are for management services and the secondment of employees. These
transactions are generally priced on a cost or cost plus basis.
                                        9
<PAGE>   10

                    THE PIONEER GROUP, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                                 MARCH 31, 2000

NOTE 8 -- FINANCIAL INFORMATION BY BUSINESS SEGMENT (CONTINUED)

     The following details selected financial data by business segment and
geographic region (dollars in thousands):
<TABLE>
<CAPTION>

                                                               PIONEER                   -SUBTOTAL-
                                                   INTERNATIONAL FINANCIAL SERVICES        PIONEER
                                     PIONEER     ------------------------------------   INTERNATIONAL
                                    INVESTMENT                        CZECH               FINANCIAL
                                    MANAGEMENT   RUSSIA    POLAND    REPUBLIC   ASIA      SERVICES
                                    ----------   -------   -------   --------   -----   -------------
<S>                                 <C>          <C>       <C>       <C>        <C>     <C>
Three months ended March 31, 2000:
Gross revenues and sales..........   $ 52,935    $ 2,077   $ 3,198    $1,087    $  --      $ 6,362
                                     ========    =======   =======    ======    =====      =======
Intersegment eliminations.........   $   (256)   $    --   $    --    $   (3)   $  --      $    (3)
                                     ========    =======   =======    ======    =====      =======
Net revenues and sales............   $ 52,679    $ 2,077   $ 3,198    $1,084    $  --      $ 6,359
                                     ========    =======   =======    ======    =====      =======
Income (loss) before income taxes
  minority interest and cumulative
  effect of accounting change.....   $ 11,020    $   657   $(1,400)   $  234    $(171)     $  (680)
                                     ========    =======   =======    ======    =====      =======
Income taxes (benefits)...........   $  3,548    $   632   $   125    $  (87)   $ (60)     $   610
                                     ========    =======   =======    ======    =====      =======
Minority interest.................   $     --    $   441   $    --    $   --               $   441
                                     ========    =======   =======    ======    =====      =======
Net income (loss).................   $  7,472    $  (416)  $(1,525)   $  321    $(111)     $(1,731)
                                     ========    =======   =======    ======    =====      =======
Depreciation and amortization.....   $  3,326    $   272   $   132    $   21    $  --      $   425
                                     ========    =======   =======    ======    =====      =======
Interest expense..................   $     --    $    --   $    15    $   --    $  --      $    15
                                     ========    =======   =======    ======    =====      =======
Capital expenditures..............   $  1,279    $   166   $    --    $    6    $  --      $   172
                                     ========    =======   =======    ======    =====      =======
Gross identifiable assets at March
  31, 2000........................   $183,655    $42,332   $ 5,591    $1,912    $  --      $49,835
                                     ========    =======   =======    ======    =====      =======
Intersegment eliminations.........   $(74,466)   $   (97)  $    --    $   (5)   $  --      $  (102)
                                     ========    =======   =======    ======    =====      =======
Net identifiable assets at March
  31, 2000........................   $109,189    $42,235   $ 5,591    $1,907    $  --      $49,733
                                     ========    =======   =======    ======    =====      =======

<CAPTION>
                                          PIONEER GLOBAL INVESTMENTS
                                    ---------------------------------------
                                                         CENT. &
                                                          EAST.               -SUBTOTAL-
                                      REAL      U.S.     EUROPE                 PIONEER
                                     ESTATE    VENTURE   VENTURE   RUSSIAN      GLOBAL
                                    SERVICES   CAPITAL   CAPITAL    TIMBER    INVESTMENTS    OTHER     TOTAL
                                    --------   -------   -------   --------   -----------   -------   --------
<S>                                 <C>        <C>       <C>       <C>        <C>           <C>       <C>
Three months ended March 31, 2000:
Gross revenues and sales..........  $   469    $    --   $   280   $     --    $    749     $ 1,363   $ 61,409
                                    =======    =======   =======   ========    ========     =======   ========
Intersegment eliminations.........             $    --   $  (141)  $     --    $   (141)    $(1,363)  $ (1,763)
                                    =======    =======   =======   ========    ========     =======   ========
Net revenues and sales............  $   469    $    --   $   139   $     --    $    608     $    --   $ 59,646
                                    =======    =======   =======   ========    ========     =======   ========
Income (loss) before income taxes
  minority interest and cumulative
  effect of accounting change.....  $  (794)   $    --   $  (215)  $(17,354)   $(18,363)    $(1,930)  $ (9,953)
                                    =======    =======   =======   ========    ========     =======   ========
Income taxes (benefits)...........  $  (292)   $    --   $   (25)  $(15,397)   $(15,714)    $  (611)  $(12,167)
                                    =======    =======   =======   ========    ========     =======   ========
Minority interest.................  $    --    $    --   $  (285)  $     --    $   (285)    $    --   $    156
                                    =======    =======   =======   ========    ========     =======   ========
Net income (loss).................  $  (502)   $    --   $    95   $ (1,957)   $ (2,364)    $(1,319)  $  2,058
                                    =======    =======   =======   ========    ========     =======   ========
Depreciation and amortization.....  $    31    $    --   $     4   $    757    $    792     $    22   $  4,565
                                    =======    =======   =======   ========    ========     =======   ========
Interest expense..................  $     2    $    --   $    --   $    248    $    250     $ 1,602   $  1,867
                                    =======    =======   =======   ========    ========     =======   ========
Capital expenditures..............  $    --    $    --   $    (3)  $    429    $    426     $    --   $  1,877
                                    =======    =======   =======   ========    ========     =======   ========
Gross identifiable assets at March
  31, 2000........................  $ 1,570    $    --   $52,032   $ 37,315    $ 90,917     $11,162   $335,569
                                    =======    =======   =======   ========    ========     =======   ========
Intersegment eliminations.........  $    --    $    --   $  (419)  $     --    $   (419)    $(3,195)  $(78,182)
                                    =======    =======   =======   ========    ========     =======   ========
Net identifiable assets at March
  31, 2000........................  $ 1,570    $    --   $51,613   $ 37,315    $ 90,498     $ 7,967   $257,387
                                    =======    =======   =======   ========    ========     =======   ========
</TABLE>

                                       10
<PAGE>   11

                    THE PIONEER GROUP, INC. AND SUBSIDIARIES
     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) -- (CONTINUED)
                                 MARCH 31, 2000
<TABLE>
<CAPTION>

                                                              PIONEER                  -SUBTOTAL-
                                                  INTERNATIONAL FINANCIAL SERVICES      PIONEER
                                    PIONEER     ------------------------------------     INTER-
                                   INVESTMENT                        CZECH             FINANCIAL
                                   MANAGEMENT   RUSSIA    POLAND    REPUBLIC   ASIA     SERVICES
                                   ----------   -------   -------   --------   -----   ----------
<S>                                <C>          <C>       <C>       <C>        <C>     <C>
Three months ended March 31, 1999:
Gross revenues and sales.........  $  51,073    $ 3,275   $ 3,823    $ 360     $  --    $ 7,458
                                   =========    =======   =======    =====     =====    =======
Intersegment eliminations........  $  (1,395)   $   (68)  $    --    $  --     $  --    $   (68)
                                   =========    =======   =======    =====     =====    =======
Net revenues and sales...........  $  49,678    $ 3,207   $ 3,823    $ 360     $  --    $ 7,390
                                   =========    =======   =======    =====     =====    =======
Income (loss) before income
  taxes, minority interest and
  cumulative effect of accounting
  change.........................  $  12,605    $  (427)  $(2,830)   $(293)    $(212)   $(3,762)
                                   =========    =======   =======    =====     =====    =======
Income taxes (benefits)..........  $   4,474    $  (283)  $   (24)   $ (68)    $ (70)   $  (445)
                                   =========    =======   =======    =====     =====    =======
Minority interest................  $      --    $    26   $   (37)   $  --     $  --    $   (11)
                                   =========    =======   =======    =====     =====    =======
Net income (loss) from continuing
  operations before cumulative
  effect of accounting change....  $   8,131    $  (170)  $(2,769)   $(225)    $(142)   $(3,306)
                                   =========    =======   =======    =====     =====    =======
Cumulative effect of change in
  accounting principle...........  $    (205)   $  (521)  $    --    $ (14)    $  --    $  (535)
                                   =========    =======   =======    =====     =====    =======
Net income (loss)................  $   7,926    $  (691)  $(2,769)   $(239)    $(142)   $(3,841)
                                   =========    =======   =======    =====     =====    =======
Depreciation and amortization....  $   3,213    $   547   $   285    $  32     $  --    $   864
                                   =========    =======   =======    =====     =====    =======
Interest expense.................  $      --    $    10   $    17    $  --     $  --    $    27
                                   =========    =======   =======    =====     =====    =======
Capital expenditures.............  $     965    $   111   $    --    $  --     $  --    $   111
                                   =========    =======   =======    =====     =====    =======
Gross identifiable assets at
  March 31, 1999.................  $ 209,381    $45,466   $10,352    $ 646     $  --    $56,464
                                   =========    =======   =======    =====     =====    =======
Intersegment eliminations........  $(111,802)   $  (265)  $    --    $  --     $  --    $  (265)
                                   =========    =======   =======    =====     =====    =======
Net identifiable assets at March
  31, 1999.......................  $  97,579    $45,201   $10,352    $ 646     $  --    $56,199
                                   =========    =======   =======    =====     =====    =======

<CAPTION>
                                                   PIONEER
                                              GLOBAL INVESTMENTS
                                   ----------------------------------------
                                                         CENT. &              -SUBTOTAL-
                                     REAL       U.S.      EAST.                 PIONEER
                                    ESTATE    VENTURE    VENTURE   RUSSIAN      GLOBAL
                                   SERVICES   CAPITAL    CAPITAL    TIMBER    INVESTMENTS    OTHER      TOTAL
                                   --------   --------   -------   --------   -----------   -------   ---------
<S>                                <C>        <C>        <C>       <C>        <C>           <C>       <C>
Three months ended March 31, 1999:
Gross revenues and sales.........  $   354    $    129   $   208   $     --    $    691     $ 3,994   $  63,216
                                   =======    ========   =======   ========    ========     =======   =========
Intersegment eliminations........  $    --    $     --   $    --   $     --    $     --     $(3,994)  $  (5,457)
                                   =======    ========   =======   ========    ========     =======   =========
Net revenues and sales...........  $   354    $    129   $   208   $     --    $    691     $    --   $  57,759
                                   =======    ========   =======   ========    ========     =======   =========
Income (loss) before income
  taxes, minority interest and
  cumulative effect of accounting
  change.........................  $(1,346)   $ (4,158)  $  (316)  $ (1,005)   $ (6,825)    $(2,531)  $    (513)
                                   =======    ========   =======   ========    ========     =======   =========
Income taxes (benefits)..........  $  (367)   $ (1,892)  $    (4)  $   (204)   $ (2,467)    $  (887)  $     675
                                   =======    ========   =======   ========    ========     =======   =========
Minority interest................  $    --    $  1,373   $  (146)  $     --    $  1,227     $    --   $   1,216
                                   =======    ========   =======   ========    ========     =======   =========
Net income (loss) from continuing
  operations before cumulative
  effect of accounting change....  $  (979)   $ (3,639)  $  (166)  $   (801)   $ (5,585)    $(1,644)  $  (2,404)
                                   =======    ========   =======   ========    ========     =======   =========
Cumulative effect of change in
  accounting principle...........  $  (115)   $   (183)  $  (382)  $(10,692)   $(11,372)    $    --   $ (12,112)
                                   =======    ========   =======   ========    ========     =======   =========
Net income (loss)................  $(1,094)   $ (3,822)  $  (548)  $(11,493)   $(16,957)    $(1,644)  $ (14,516)
                                   =======    ========   =======   ========    ========     =======   =========
Depreciation and amortization....  $    37    $     45   $    75   $    545    $    702     $    32   $   4,811
                                   =======    ========   =======   ========    ========     =======   =========
Interest expense.................  $     2    $    203   $    --   $    364    $    569     $ 1,631   $   2,227
                                   =======    ========   =======   ========    ========     =======   =========
Capital expenditures.............  $    --    $     --   $    70   $    720    $    790     $     3   $   1,869
                                   =======    ========   =======   ========    ========     =======   =========
Gross identifiable assets at
  March 31, 1999.................  $ 4,736    $ 25,343   $50,357   $ 44,789    $125,225     $14,277   $ 405,347
                                   =======    ========   =======   ========    ========     =======   =========
Intersegment eliminations........  $  (274)   $(24,193)  $    --   $     --    $(24,467)    $(6,132)  $(142,666)
                                   =======    ========   =======   ========    ========     =======   =========
Net identifiable assets at March
  31, 1999.......................  $ 4,462    $  1,150   $50,357   $ 44,789    $100,758     $ 8,145   $ 262,681
                                   =======    ========   =======   ========    ========     =======   =========
</TABLE>

                                       11
<PAGE>   12

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

                                    OVERVIEW

     The consolidated financial statements of The Pioneer Group, Inc. (the
"Company") include the Company's three strategic business units. Pioneer
Investment Management includes the investment management, marketing,
distribution and servicing of the Company's mutual funds based in the United
States and offshore funds based in Ireland. This business unit also provides
investment management services for institutional investors. Pioneer
International Financial Services includes the Company's investment management
and financial services businesses in Poland, the Czech Republic, Russia and
India. Pioneer Global Investments includes the Company's worldwide venture
capital, real estate and timber operations. The Company is in the process of
disposing of its gold mining operations and, as such, has reported these as
discontinued operations. Management's Discussion and Analysis of Financial
Condition and Results of Operations is presented in three sections: Results of
Operations, Liquidity and Capital Resources-General and Future Operating
Results.

     The Board of Directors engaged the services of two investment banking firms
to provide advice on enhancing shareholder value. At a special meeting of the
Board held on March 2, 2000, the investment bankers presented their evaluations
of several alternatives to the Board. The Board determined to authorize the
bankers to actively explore strategic alternatives, including a possible sale of
the Company. Subsequently, numerous third parties expressed interest in the form
of non-binding proposals, and after executing the appropriate confidentiality
agreements, several have now completed due diligence. Management currently is in
detailed discussions with firms who have expressed the most interest.

     As a result of this process, as well as the proxy contest initiated by a
dissident shareholder, the Company's results from operations reflect several
unusual and temporary items. For example, mutual fund sales have slowed and
redemptions have increased while many of the intermediaries who sell the
Company's fund shares await the outcome of this process. The Company's most
valuable assets are its relationships with clients and the employees who provide
these clients with services. Accordingly, the Company increased its advertising
and other sales promotional expenses and entered into various employee retention
arrangements to maintain the value of these assets. Finally, these events have
resulted in higher temporary legal, proxy solicitation, and other related
expenses. Substantially all of these effects have been reflected in the Pioneer
Investment Management segment.

                             RESULTS OF OPERATIONS

CONSOLIDATED OPERATIONS

     In the first quarter of 2000, the Company had net income from continuing
operations of $2.1 million, or $0.08 per share. During the first quarter of
1999, the Company reported losses from continuing operations of $2.4 million, or
$0.09 per share, losses from gold mining and powdered metals operations of $6.1
million, or $0.24 per share, and the impact of the write-off of unamortized
capitalized start-up costs of $12.1 million, or $0.47 per share, as a result of
the required change in accounting principle. Revenues from continuing operations
were $59.6 million in the first quarter of 2000 compared to $57.8 million in the
first quarter of 1999. First quarter 1999 results from continuing operations
also included a one-time loss of $3.4 million, or $0.13 per share, related to
the Company's sale of its U.S. venture capital operations.

     Worldwide assets under management were approximately $24.4 billion at March
31, 2000, compared to $24.5 billion at December 31, 1999.

                                       12
<PAGE>   13

     The following table details revenues and net income (loss) by business
segment for the three months ended March 31, 2000, and 1999, respectively.

                         REVENUES AND NET INCOME (LOSS)
                             (DOLLARS IN MILLIONS)

<TABLE>
<CAPTION>
                                                                 REVENUES        NET INCOME (LOSS)
                                                             ----------------    -----------------
                                                               THREE MONTHS        THREE MONTHS
                                                             ENDED MARCH 31,      ENDED MARCH 31,
                                                             ----------------    -----------------
BUSINESS SEGMENT                                              2000      1999      2000      1999
----------------                                             ------    ------    ------    -------
<S>                                                          <C>       <C>       <C>       <C>
Pioneer Investment Management:
  Mutual Funds and Institutional Accounts..................  $52.7     $49.6     $ 7.5     $  8.1
                                                             -----     -----     -----     ------
Pioneer International Financial Services:
  Russia...................................................    2.1       3.3      (0.4)      (0.2)
  Central and Eastern Europe...............................    4.3       4.2      (1.2)      (3.0)
  Asia.....................................................     --        --      (0.1)      (0.1)
                                                             -----     -----     -----     ------
                                                               6.4       7.5      (1.7)      (3.3)
                                                             -----     -----     -----     ------
Pioneer Global Investments:
  Venture Capital..........................................    0.1       0.3       0.1       (3.8)
  Real Estate..............................................    0.4       0.4      (0.5)      (1.0)
  Timber...................................................     --        --      (2.0)      (0.8)
                                                             -----     -----     -----     ------
                                                               0.5       0.7      (2.4)      (5.6)
                                                             -----     -----     -----     ------
Interest Expense and Other Expenses........................     --        --      (1.3)      (1.6)
                                                             -----     -----     -----     ------
  Total From Continued Operations..........................  $59.6     $57.8     $ 2.1     $ (2.4)
                                                             -----     -----     -----     ------
Discontinued Operations....................................     --        --        --       (6.1)
                                                             -----     -----     -----     ------
Cumulative Effect of Change in Accounting Principle
(Start-up Costs)...........................................     --        --        --      (12.1)
                                                             -----     -----     -----     ------
          Totals...........................................  $59.6     $57.8     $ 2.1     $(20.6)
                                                             =====     =====     =====     ======
</TABLE>

PIONEER INVESTMENT MANAGEMENT

     Pioneer Investment Management ("PIM") had first quarter net income of $7.5
million compared to net income of $8.1 million in the first quarter of 1999. The
earnings decline was attributable to higher labor expenses incurred to retain
key sales and investment management employees as the Company explored strategic
alternatives, and higher advertising and selling expenses, including those
associated with the launch of two new mutual funds.

     PIM's assets under management at March 31, 2000 were approximately $24.0
billion compared to $24.1 billion at December 31, 1999. In the first quarter of
2000, sales of U.S. registered mutual funds (including reinvested dividends)
were $770 million, compared to $950 million in the first quarter of 1999. Net
redemptions were $1.0 billion, compared to $50 million in the first quarter of
1999.

     Revenues of $52.7 million in the first quarter of 2000 increased by $3.1
million, or 6%. Management fee revenues of $37.1 million increased by $3.8
million, reflecting both higher average assets under management ($23.4 billion
for the first quarter 2000 compared to $22.7 billion for the first quarter 1999)
and a 4.1 basis point increase in average management fees earned in the quarter.
Revenues from underwriting commissions, distribution fees, and shareholder
servicing fees decreased slightly by $0.9 million to $12.8 million, as increased
shareholder service fees partially offset lower distribution fees. During March
2000, the Company reallowed 100% of its share of Class A share commissions to
brokers and dealers as an incentive to increase sales. The Company anticipates
continuing this reallowance program through the second quarter of 2000.

                                       13
<PAGE>   14

     Costs and expenses increased by $4.8 million in the first quarter of 2000
to $41.7 million. The expense increase resulted from higher payroll costs ($2.9
million) due to normal merit pay increases and higher headcount, coupled with
special retention bonuses associated with the Company's strategic evaluation
process. Other expenses also increased by $1.9 million. A portion of this
increase related to distribution costs ($0.8 million) for special advertising
during the Company's strategic evaluation process. The remainder of the increase
was largely due to higher legal and space-related expenses.

     PIM's effective tax rate for the first quarter of 2000 was 32% compared to
35% in the first quarter of 1999. The improvement was due to increased
profitability at Pioneer Management Ireland Limited, which is taxed at a lower
effective rate.

PIONEER INTERNATIONAL FINANCIAL SERVICES

     During the first quarter of 2000, Pioneer International Financial Services
("PIFS") lost $1.7 million on revenues of $6.4 million compared to a loss of
$3.3 million in the first quarter of 1999 on revenues of $7.5 million. Absent
losses of the Company's Polish pension subsidiary ($1.2 million), Central and
Eastern European operations posted break-even results for the quarter. PIFS's
first quarter 2000 Russian losses ($0.4 million) related to a U.S. tax provision
that was required due to a repatriation of earnings ($5.7 million). Absent the
tax provision, local Russian operations reported break-even results for the
quarter. Regarding PIFS's first quarter 1999 loss of $3.3 million, $2.2 million
related to the Company's pension subsidiary. In April 1999, the Company sold 30%
of its Polish pension company subsidiary to Nationwide Global Holdings, Inc. for
$20 million. In addition, the Company deconsolidated the Polish pension company
as control is shared with Nationwide and has accounted for its investment in the
pension company under the equity method retroactive to January 1, 1999. Given
the results of the Company's Polish pension company subsidiary and the likely
consolidation of the participants in the industry, the Company is currently
exploring strategic alternatives, which could include a sale of this subsidiary.

PIONEER GLOBAL INVESTMENTS

     Pioneer Global Investments lost $2.4 million in the first quarter of 2000
on revenues of $0.5 million. The Company's Central and Eastern European venture
capital operations posted slightly profitable results in the first quarter of
2000. In contrast, the Company's worldwide venture capital operations lost $3.8
million in the first quarter of 1999, of which $3.4 million represents a
one-time loss realized on the sale of U.S. venture capital operations. In March
1999, the Company sold its direct investments and indirect interests of its U.S.
venture capital business for $34.9 million.

     The Company's real estate services operations reported losses of $0.5
million in the first quarter of 2000 and $1.0 million in the first quarter of
1999. The improvement of $0.5 million reflects higher revenues and lower costs
associated with the closing of the Polish Real Estate Fund. Most of the first
quarter 2000 losses were caused by the delay in closing the PBO Property Fund.

  Timber Business

     The results of the timber business are substantially attributable to the
operations of Forest-Starma, the 100% owned principal operating subsidiary of
the Company's wholly owned subsidiary, Pioneer Forest, Inc. Forest-Starma
harvests timber under a 49-year lease comprising 390,100 hectares (approximately
964,000 acres) in the Khabarovsk Territory of Russia. Forest-Starma has
developed a modern logging camp, including a harbor, from which it exports
timber to markets in the Pacific Rim.

     While Forest-Starma harvests timber and incurs the resulting operating
expenses throughout the year, it typically ships timber from mid-April through
December. As a result, Forest-Starma has incurred, and expects to continue to
incur, operating losses from fixed costs in the first quarter of the Company's
fiscal year. There were no shipments in the first quarters of 2000 or 1999.
Variable costs incurred to produce timber are

                                       14
<PAGE>   15

capitalized in inventory and charged to operations when shipped. The following
table summarizes production statistics for the three months ended March 31, 2000
and 1999:

<TABLE>
<CAPTION>
                                                         THREE MONTHS ENDED
                                                              MARCH 31,
                                                       -----------------------
                                                          2000         1999
                                                       ----------   ----------
<S>                                                    <C>          <C>
Total cubic meters produced..........................      65,200       85,600
Average costs of production (per cubic meter)........  $       47   $       44
</TABLE>

  Results of Operations

     In the first quarter of 2000, the timber business lost $2.0 million
compared with a loss of $0.8 million in the first quarter of 1999. The decline
resulted principally from additional charges associated with usage of spare
parts inventories to maintain timber production equipment.

     The timber segment's operating results also included both income from U.S.
tax benefits of approximately $15.1 million and the application of those tax
benefits to reduce the carrying value of the Company's timber assets. The
income, which is reflected on the Consolidated Statements of Operations as a
credit to tax expense, represented realization in the U.S. of previously
unrecognized foreign losses. In connection with the realization of the income
tax benefits, the Company recorded a corresponding reduction in the carrying
value of timber equipment and facilities and deferred development costs. The tax
benefits were largely collected in April 2000 and used to repay bank debt.

  Liquidity and Capital Resources

     Forest-Starma had $5 million of external debt as of March 31, 2000.
Scheduled debt service for the remainder of 2000 is expected to aggregate $1.7
million.

  Recent Developments

     The Company is actively exploring strategic alternatives with respect to
its interest in the timber business.

DISCONTINUED OPERATIONS

  Gold Mining

     During the second quarter of 1999, the Company reflected the gold mining
segment as a discontinued operation. The gold mining segment consists of Pioneer
Goldfields Limited ("PGL"), and its 90%-owned Ghanaian operating subsidiary,
Teberebie Goldfields Limited ("TGL"), and Closed Joint-Stock Company "Tas-Yurjah
Mining Company" ("Tas-Yurjah"), the Company's majority owned (95%) Russian
subsidiary.

     The Company has engaged the services of an investment banking firm to sell
PGL, including its African exploration rights and its ownership interest in TGL.
An offering document, which incorporated a new mine plan and revised reserve
estimates, was circulated in the second quarter of 1999 to a select group of
potential buyers. Several of these potential buyers began conducting due
diligence efforts during the third quarter of 1999. The Company is now
conducting what it believes to be final negotiations with potential purchasers.

     Whether or not the Company consummates a sale, it has proceeded with an
orderly closure of the Teberebie mine. Mining operations ceased at the end of
the 1999, and all processing activities will be completed by the end of the
first half of 2000.

     The accompanying consolidated financial statements reflect management's
estimates of the costs of winding down the gold mining operations. The Company,
however, may record gains or incur additional losses in either a sales
transaction or closure scenario as details, timing, and other events unfold.
There can be no assurance that the Company can successfully negotiate a sales
transaction and consummate that transaction or close the mine in accordance with
management's estimates.

                                       15
<PAGE>   16

  Powdered Metals

     Losses in the first quarter of 1999 were $0.1 million. In the second
quarter of 1999, the Company decided to dispose of its powdered metals
operations. At the end of the third quarter of 1999, the Company sold for
nominal value the powdered metals operations.

OTHER

     The Company had net interest expense and other expenses of $1.3 million in
the first quarter of 2000 compared to $1.6 million in the first quarter of 1999.
The decrease resulted principally from lower interest expense as the Company has
paid down its revolving credit agreement.

                   LIQUIDITY AND CAPITAL RESOURCES -- GENERAL

     Liquid assets consisting of cash and marketable securities decreased by
$3.4 million in the first quarter of 2000 to $37.3 million. Cash provided from
ongoing operations, combined with tax refunds received in the quarter, were used
to pay down the Company's Corporate Revolver by $25 million. In May 2000, the
Company completed the pay-off of the remaining balance of the Corporate
Revolver.

     The Company believes that it is in sound financial condition, that it has
sufficient liquidity from operations and financing facilities to cover
short-term commitments and contingencies and that it has adequate capital
resources to provide for long-term commitments.

                            FUTURE OPERATING RESULTS

     From time to time, management may make forward-looking statements in this
Quarterly Report, in other documents that we file with the Securities and
Exchange Commission (including those documents incorporated by reference into
the Form 10-K), in press releases or in other public discussions. The Private
Securities Litigation Reform Act of 1995 provides a "safe harbor" for these
statements. For this purpose, a forward-looking statement is any statement that
is not a statement of historical fact. Forward-looking statements include those
about our plans or strategies for our domestic and international financial
services and global investment businesses, our anticipated revenue growth,
changes we expect in the amount or composition of our assets under management,
our anticipated expenses, our liquidity and capital resources and our
expectations about market conditions. You can identify forward-looking
statements by the words "may," "believes," "anticipates," "plans," "expects,"
"estimates" and similar expressions. Our forward-looking statements are based on
currently available information and management's expectations of future results
but necessarily involve certain assumptions. We caution readers that our
assumptions involve substantial risks and uncertainties. Consequently, any
forward-looking statement could turn out to be wrong. Many factors could cause
actual results to differ materially from our expectations. Below we describe
some of the important factors that could affect our revenues or results of
operations.

     We hired two investment banks to review strategic alternatives that would
maximize shareholder value, including the possible sale of the Company. Also,
Lens Investment Management, LLC filed a proxy statement on Schedule 14A for the
purpose of soliciting proxies for the election of its five nominees to the
Company's Board of Directors to replace five of our directors. The news of these
events has created uncertainty for our stockholders and employees. During these
times of uncertainty, we are subject to the risks of reduced investor
confidence, redemptions in our mutual funds, loss of business opportunities, and
difficulty in hiring and retaining quality employees. In fact, mutual fund sales
have slowed and redemptions have increased. Additionally, the Company has
incurred significant expenses in connection with this process. We cannot
guarantee that the uncertainties will not have further adverse effects on our
financial condition and financial results.

     A significant portion of our revenues comes from investment management fees
and underwriting and shareholder services fees. Our success in the investment
management and mutual fund share distribution businesses results primarily from
good investment performance. If our investments perform well, we tend to
                                       16
<PAGE>   17

see higher sales of shares and lower redemptions of shares. Sales of shares
result in increased assets under management, which, in turn, generate higher
management fees. Good performance also attracts institutional accounts. On the
other hand, relatively poor performance tends to cause decreased sales and
increased redemptions and the loss of institutional accounts. As a result, we
see a corresponding decrease in our revenues. In addition, economic and market
conditions that are beyond our control can impact investment performance. Also,
five of our mutual funds (including the two largest funds) have management fees
that depend upon the funds' performance relative to the performance of
established stock indexes. As a result, management fee revenues may be subject
to unexpected volatility.

     The mutual fund industry is intensely competitive and continues to go
through substantial consolidation. Many organizations in this industry are
attempting to sell and service the same clients and customers, not only with
mutual fund investments, but also with other financial service products. Many of
our competitors have more products and product lines to offer, substantially
greater assets under management, better financial resources and higher name
recognition than we do. As a result, we could be at a disadvantage as we try to
market our products to the same customers that our competitors are targeting.

     Our domestic investment management business is primarily dependent upon the
contractual relationships between our U.S. mutual funds and our management
company. If any of these agreements were terminated (for any reason, including a
change of control of the Company) or not renewed on similarly favorable terms,
our revenues and our investment management business would suffer greatly.

     The performance of a particular mutual fund depends in large part on the
ability of its portfolio manager. Our ability to attract and retain talented
portfolio managers and other key personnel is critical to our success in the
investment management business. We cannot guarantee that we will be able to
market our products successfully or maintain long-term relationships with our
clients if we do not employ top quality personnel.

     The investment management business is subject to periodic shifts depending
on market conditions and investor preferences. Firms like ours tend to focus on
certain asset classes and certain management styles. Shifting trends in the
investment management industry tend to favor firms that manage particular types
of assets or use particular management styles. As a result, firms need to be
able to adapt to these shifts in order to remain competitive. Historically, we
have focused on "value" investing. We cannot guarantee that we will be
successful as we broaden our asset classes and management styles in order to
adapt to market demands.

     Our investment management operation is subject to extensive regulation in
the United States, including regulation by the Securities and Exchange
Commission and the National Association of Securities Dealers, Inc. Also, we are
subject to the laws of non-U.S. jurisdictions and non-U.S. regulatory agencies
or bodies. If we do not comply with applicable laws or regulations, we could
suffer fines, suspension of personnel or other sanctions. Certain changes in
laws or regulations or in government policies could have a material adverse
effect on our business.

     We have several operations and investments outside of the United States,
including the timber operations in the Russian Far East and the financial
services operations in Eastern and Central Europe. Many factors unique to these
foreign locations can have negative effects on our operations and investments
there. Some of these factors are exchange controls, currency fluctuations,
taxation, political and economic instability, ineffective regulatory oversight
and laws or policies of the particular countries in which we have operations. We
cannot guarantee that we will be able to obtain permits, authorizations,
regulatory approvals or agreements to implement plans at our foreign projects in
a manner or within time frames that make these plans economically feasible.
Also, we do not know whether applicable laws or the governing political
authorities in the relevant locations will change unfavorably or whether any
such changes will cost us material amounts of money or effort.

     The commercial feasibility of Forest-Starma depends on a number of factors
that we cannot control. Some of these factors are the price of timber, weather
conditions, political instability in Russia and the strength of the Japanese and
Korean economies, which are the primary markets for Forest-Starma's timber.

                                       17
<PAGE>   18

     We continue to actively negotiate a possible sale of our gold mining
operations, although we can provide no assurance that a sale will occur. If for
any reason a sale is not consummated, our financial results and financial
condition may be materially adversely affected.

                          PART II -- OTHER INFORMATION

ITEM 6.  EXHIBITS AND REPORTS ON FORM 10-K

     (a) Exhibits

         The Exhibits filed with this Quarterly Report on Form 10-Q are listed
         on the "Exhibit Index" below and incorporated by reference herein.

     (b) Reports filed on Form 8-K.

         None.

                                   SIGNATURES

     It is the opinion of management that the financial information contained in
this report reflects all adjustments necessary to a fair statement of results
for the period report, but such results are not necessarily indicative of
results to be expected for the year due to the effect that stock market
fluctuations may have on assets under management. All accounting policies have
been applied consistently with those of prior periods. Such financial
information is subject to year-end adjustments and annual audit by independent
public accountants.

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

Dated:  May 11, 2000

                                            THE PIONEER GROUP, INC.

                                                   /s/ ERIC W. RECKARD
                                            ------------------------------------
                                                      Eric W. Reckard,
                                                  Executive Vice President
                                                Chief Financial Officer and
                                                         Treasurer

                                       18
<PAGE>   19

                                 EXHIBIT INDEX

<TABLE>
<CAPTION>
EXHIBIT NUMBER                           DESCRIPTION
--------------   ------------------------------------------------------------
<C>              <S>
  27.00          Financial Data Schedule.
</TABLE>

                                       19