<PAGE>   1


                     U.S. SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                    FORM 10-Q

     |X|  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
                        SECURITIES EXCHANGE ACT OF 1934
                 For the Fiscal Quarter Ended September 30, 1999
                                       OR
     |_|  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D)
               OF THE SECURITIES EXCHANGE ACT OF 1934
                  For the Transition Period from       to
                                                ------   ------

                         Commission file number 0-26756

                                GEOGRAPHICS, INC.
             (Exact Name of Registrant as Specified in Its Charter)

                                ----------------
          WYOMING                                      87-0305614
(State or Other Jurisdiction                        (I.R.S. Employer
Incorporation or Organization)                     Identification No.)

            1555 ODELL ROAD, P.O. BOX 1750, BLAINE, WASHINGTON 98231
              (Address and Zip Code of Principal Executive Offices)

        Registrant's Telephone Number, Including Area Code (360) 332-6711

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

        Securities registered pursuant to Section 12(b) of the Act: NONE

 Securities registered under Section 12(g) of the Exchange Act: COMMON STOCK,
 NO PAR VALUE

Indicate by checkmark whether the registrant: (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.                               Yes    No |X|
                                                                     ---   ---
     The aggregate market value of the common stock held by nonaffiliates of
the registrant as of November 1, 1999 was $13,502,032 based on a closing sales
price of $0.53125 per share on the NASDAQ OTC Bulletin Board on such date.

     The number of shares outstanding of the registrant's common stock, no par
value, as of November 1, 1999 was 25,415,589.

                      DOCUMENTS INCORPORATED BY REFERENCE.
                                      None.


<PAGE>   2


                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                                       PAGE


<S>      <C>                                                                                                           <C>
PART I - FINANCIAL INFORMATION..........................................................................................1

         ITEM 1.  FINANCIAL STATEMENTS..................................................................................1

         ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.................1

                  FORWARD-LOOKING STATEMENTS............................................................................1

                  RESULTS OF OPERATIONS.................................................................................2

                  LIQUIDITY AND CAPITAL RESOURCES.......................................................................3

         ITEM 3.  QUANTATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK...............................................4

PART II - OTHER INFORMATION.............................................................................................4

         ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS.............................................................4

         ITEM 5 - OTHER INFORMATION.....................................................................................5

         ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K......................................................................5

SIGNATURE...............................................................................................................6
</TABLE>








                                      -i-
<PAGE>   3


                         PART I - FINANCIAL INFORMATION

ITEM 1.   FINANCIAL STATEMENTS

     Geographics, Inc. (the "Company" or "Geographics") has attached to this
Report and by this reference incorporated herein the consolidated balance sheets
as of September 30, 1999 (unaudited) and March 31, 1999 (audited), the unaudited
statements of operations for the three months ended September 30, 1999 and
September 30, 1998, and the unaudited consolidated statements of cash flows for
the three months ended September 30, 1999 and September 30, 1998, together with
the notes thereto.

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

     The following discussion should be read in conjunction with the
consolidated financial statements of the Company and the notes thereto appearing
elsewhere in this Report.

FORWARD-LOOKING STATEMENTS

     Statements herein concerning expectations for the future constitute
forward-looking statements which are subject to a number of known and unknown
risks, uncertainties and other factors which might cause actual results to
differ materially from those expressed or implied by such forward-looking
statements. Forward-looking statements herein include, but are not limited to,
those concerning anticipated growth in the preprint paper market; anticipated
growth in the Company's sales; anticipated growth in sales of specialty paper
products as a percentage of revenue; the Company's ability to increase its
market share within the preprint industry; the ability of the Company to
successfully implement price changes for the Company's products when and as
needed; trends relating to the Company's profitability and gross profits
margins; the ability of the Company to implement, or modify its management
information system, adequately to meet operations requirements in the future and
to improve its internal controls; and the ability of the Company to refinance
its existing revolving credit facility and to raise additional debt or equity
financing sufficient to meet its working capital requirements.

     Relevant risks and uncertainties include, but are not limited to, slower
than anticipated growth of the preprint paper market; loss of certain key
customers; insufficient consumer acceptance of the Company's specialty paper
products; unanticipated actions, including price reductions, by the Company's
competitors; unanticipated increases in the costs of raw materials used to
produce the Company's products; supply terms, reliable and immediately available
raw material supply and other favorable terms with certain key vendors, greater
than expected costs incurred in connection with the implementation of a
management information system; failure to realize expected economic efficiencies
of the Company's automated production system; the inability to hire and retain
key personnel; unexpected increases in the overall costs of production as a
result of collective bargaining arrangements; and inability to secure additional
working capital when and as needed. Additional risks and uncertainties include
those described under "Risk Factors" in Part I of the Company's Annual Report on
Form 10-K for the year ended March 31, 1999 and those described from time to
time in the Company's other filings with the Securities and Exchange Commission,
press releases and other communications. All forward looking statements
contained in this Report reflect the Company's expectations at the time of this
Report only, and the Company disclaims any responsibility to revise or update
any such forward-looking statement except as may be required law.





                                      -1-
<PAGE>   4

RESULTS OF OPERATIONS

Three Months Ended September 30, 1999 vs. Three Months Ended September 30, 1998

     NET SALES. Net sales increased 40.9% to $6,592,301 in the quarter ended
September 30, 1999 from $4,677,270 in the quarter ended September 30, 1998. The
increase was attributable to new business generated from Sam's Club, an increase
in the Company's seasonal programs, and significantly higher sales in Europe,
which increased 48.2% from fiscal 1999. In addition, the Company made higher
accruals for customer program costs and credits ($1,538,127 or 18.9% of gross
sales for the quarter ended September 30, 1999 compared to $1,001,936 or 17.6%
of gross sales for the quarter ended September 30, 1998). The Company's new
management has adopted a philosophy to accrue the realistic amounts due under
our customer programs throughout the year to better reflect anticipated results.

     GROSS MARGIN. Gross margin as a percentage of gross sales decreased to
19.6% in the quarter ended September 30, 1999, from 31.4% in the same period in
fiscal 1999. The lower gross margin percentage is attributable to the lower net
sales as a result of the accruals of customer program costs, an increase in the
cost of the Company's paper (4.43%) and supplies, and an increase in freight,
primarily due to an increase in freight accruals, and shipping costs. Management
is continuing to implement ways to improve manufacturing efficiency.

     SELLING, GENERAL AND ADMINISTRATIVE EXPENSES. While selling, general and
administrative expenses increased to $1,457,760 in the quarter ended September
30, 1999 from $1,343,037 in the same period in fiscal 1999, the Company saw a
decrease in these expenses on a percentage of sales basis to 17.9% in the
quarter ended September 30, 1999 from 23.7% during the quarter ended September
30, 1998. The increase is primarily attributable to an increase in
administrative salaries ($52,527) and travel expenses ($50,030).

     OTHER INCOME (EXPENSE). Other income for the quarter ended September 30,
1999 amounted to $137,279 compared to other expense of $24,641 for the quarter
ended September 30, 1998. The change is due to the income recognized from
favorable settlements of amounts owed to vendors.

     INTEREST EXPENSE. Interest expense decreased to $183,824 (2.3% of gross
sales) during the quarter ended September 30, 1999, compared to $270,429 (4.8%
of gross sales) during the same period in fiscal 1999. The lower interest costs
were caused by a decrease in borrowings of the Company which were refinanced
with the proceeds from the private placement of the Company's common stock. See
"Liquidity and Capital Resources."

Six Months Ended September 30, 1999 vs. Six Months Ended September 30, 1998

     NET SALES. Net sales increased 9.0% to $11,092,219 in the six months ended
September 30, 1999 from $10,174,432 in the six months ended September 30, 1998.
The increase was attributable to new business generated from Sam's Club and an
increase in the Company's seasonal programs. In addition, the Company made
higher accruals for customer program costs and credits ($2,583,625 or 18.9% of
gross sales for the six months ended September 30, 1999 compared to $1,665,158
or 14.1% of gross sales for the six months ended September 30, 1998). The
Company's new management has adopted a philosophy to accrue the realistic
amounts due under our customer programs throughout the year to better reflect
anticipated results.

     GROSS MARGIN. Gross margin as a percentage of gross sales decreased to
19.0% in the six months ended September 30, 1999, from 31.9% in the same period
in fiscal 1999. The lower gross margin percentage is attributable to the lower
net sales as a result of the accruals of customer program

                                      -2-
<PAGE>   5


costs, an increase in the cost of the Company's paper, wages and supplies, and
an increase in freight, primarily due to an increase in freight accruals, and
shipping costs.

     SELLING, GENERAL AND ADMINISTRATIVE EXPENSES. Selling, general and
administrative expenses decreased to $2,575,865 (18.8% of gross sales) during
the six months ended September 30, 1999 from $2,868,209 (24.2% of gross sales)
in the same period in fiscal 1999. The decrease is primarily attributable to a
decrease in consulting ($260,000) and legal expenses ($65,000).

     OTHER INCOME (EXPENSE). Other income for the six months ended September 30,
1999 amounted to $309,671 compared to other expense of $40,214 for the six
months ended September 30, 1998. The change is due to the income recognized from
favorable settlements of amounts owed to vendors.

     INTEREST EXPENSE. Interest expense decreased to $421,569 (3.1% of gross
sales) during the six months ended September 30, 1999, compared to $607,909
(5.1% of gross sales) during the same period in fiscal 1999. The lower interest
costs were caused by a decrease in borrowings of the Company which were
refinanced with the proceeds from the private placement of the Company's common
stock. See "Liquidity and Capital Resources."

LIQUIDITY AND CAPITAL RESOURCES

     As a result of the rapid growth of the Company's specialty papers group,
capital expenditures relating to the purchase and installation of an automated
production system and a management information system, prior year operating
losses, the Company has required substantial external working capital. The
Company has previously experienced working capital shortfalls, which required
the Company to delay payments to certain vendors, institute internal cost
reduction measures and take other steps to conserve operating capital. The
recapitalization currently in process has alleviated part of this problem. For
the year ended March 31, 1999, operating losses totaled $3,096,106, however the
Company experienced positive operating cash flows of $1,554,310.

     At the date of this Report, the Company's only available source of working
capital consisted of borrowings available under its revolving credit facility.
The revolving credit facility permits borrowings of up to $5.5 million subject
to a borrowing base limitation of 70% of the value of the Company's eligible
accounts and 55% of the value of its inventory, net of certain reserves.
Borrowings under the facility bear interest at the prime rate and are secured by
substantially all of the Company's assets. Under the terms of the facility, the
Company is required to comply with a number of financial covenants relating to,
among other things, the maintenance of minimum net worth, debt-to-equity ratios
and cash flow coverage ratios.

     The Company failed to comply with the net worth, debt-to-equity ratios and
cash flow coverage ratios under the revolving credit facility. The Company's
lender has also provided the Company with several mortgage loans and equipment
loans, and the existence of the defaults under the revolving credit facility
constitutes default under these other loans. The report of the Company's
auditors included in this Report states that the Company's fiscal 1999 and 1998
losses and non-compliance with covenants under its revolving credit facility
raise substantial doubt about the Company's ability to continue as a going
concern.

     In September of 1999, the Company secured agreement from its principal
lender to extend the seventh forbearance agreement until November 15, 1999. As a
result of new capital raised and favorable changes in management and operations,
the Company has received and accepted a banking proposal with US Bank,
Milwaukee, Wisconsin to refinance the Company's debt arrangements. As of the
date of this Report, Geographics has received over $4,700,000 in a private
placement of common stock, with proceeds to the Company at $0.30 per share,
which included significant investments from Messrs.



                                      -3-
<PAGE>   6


William T. Graham, Director and Executive Vice President of the Company, and
James L. Dorman, Director, Chairman and Chief Executive Officer of the Company,
and their respective affiliates. Further, the Company has engaged Culverwell &
Co., Inc. of Boston, Massachusetts to use their best efforts to raise an
additional $3,000,000 in a private placement of common stock, with net proceeds
to the Company of $0.30 per share. The offering prices were determined after
giving effect to minority discounts, and the fact that the new investors are
receiving unregistered securities. Upon successful refinancing, the Company
intends to eliminate all bank term loans and the defaults associated with those
loans. The Company estimates that the effect of the Company's recapitalization
plan will result in a decrease in interest expense over $600,000 on an
annualized basis. Management anticipates that the recapitalization plan will be
completed during the third fiscal quarter.

ITEM 3.   QUANTATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

     Substantially all of the revenue and operating expenses of the Company's
foreign subsidiaries are denominated in local currencies and translated into US
dollars at rates of exchange approximating those existing at the date of the
transactions. Foreign currency translation impacts primarily revenue and
operating expenses as a result of foreign exchange rate fluctuations. The
Company's foreign currency transaction risk is primarily limited to amounts
receivable from its foreign subsidiaries, which are denominated in local
currencies. To minimize foreign currency transaction risk, the Company ensures
that its foreign subsidiaries remit amounts to the U.S. parent in a timely
manner. The Company does not currently utilize foreign currency hedging
contracts.

     The Company also has foreign exchange translation exposures resulting from
the translation of foreign currency-denominated earnings into U.S. dollars in
the Company's consolidated financial statements. Foreign currency transaction
exposure arises when an operating unit transacts business denominated in a
currency that is not its own functional currency. The Company's transaction
risks are attributable primarily to inventory purchases from third party
vendors. The introduction of the Euro has significantly reduced such risks, and
transaction exposures on an overall basis are not material.

     If the U.S. dollar uniformly increases in strength by 3% in fiscal year
2000 relative to the currencies in which the Company's sales are denominated,
income before taxes would decrease by $55,000 for the quarter ended September
30, 1999. This calculation assumes that each exchange rate would change in the
same direction relative to the U.S. dollar. In addition to the direct effects of
changes in exchange rates, which are a changed dollar value of the resulting
sales, changes in exchange rates also affect the volume of sales or the foreign
currency sales price as competitors' products become more or less attractive.
The Company's sensitivity analysis of the effects of changes in foreign currency
exchange rates does not factor in a potential change in sales levels or local
currency prices.

                           PART II - OTHER INFORMATION

ITEM 2.   CHANGES IN SECURITIES AND USE OF PROCEEDS

Sales Of Unregistered Securities

     During the quarter ended September 30, 1999, the Company issued 15,558,337
shares of common stock in a private placement at $.30 per share, pursuant to an
exemption from registration under Sections 4(2) and 4(6) of the Securities Act
of 1933, as amended, and Rule 506 promulgated thereunder. The following officers
and directors of the Company purchased shares pursuant to the offering:



                                      -4-
<PAGE>   7


<TABLE>
<CAPTION>
NAME                       POSITION                                           SHARES
----                       --------                                           ------
<S>                        <C>                                             <C>
William T. Graham          Director and Executive Vice President           2,000,000
James L. Dorman            Chairman and Chief Executive Officer              956,178
C. Joseph Barnette         Director                                          170,000
John G. Rossmiller         Chief Operating Officer                           150,000
Jeffrey M. Kildow          Vice President - Sales                            133,333
David Schenker             Vice President - Sales                            133,333
                                                                           ---------
Total                                                                      3,542,844
                                                                           =========
</TABLE>

The balance of the shares were issued to accredited investors who had been
solicited by officers and directors of the Company. Further, the Company has
engaged Culverwell & Co., Inc. of Boston, Massachusetts to use their best
efforts to raise an additional $3,000,000 in a private placement of common
stock, with net proceeds to the Company of $0.30 per share. See "Liquidity and
Capital Resources." The private placement offering remains open, and the Company
expects to receive additional commitments above and beyond what has been
received and issued as of the date of this report.

ITEM 5 - OTHER INFORMATION

Refinancing Plan

     The Company has accepted a proposal from US Bank Milwaukee, Wisconsin, to
refinance its bank debt. US Bank has agreed to extend to the Company a
$7,500,000 credit facility governed by various borrowing base restrictions and
other financial covenants. Upon successful refinancing, the Company intends to
eliminate all bank term loans and the defaults associated with those loans. The
Company expects to complete the refinancing during the third fiscal quarter.

New Products

     The Company has entered into an exclusive distribution arrangement in the
United States, Canada and Mexico for a new line of easy to assemble plastic file
cabinet and storage drawer products.

     The Company also intends to introduce a line of fine writing papers during
the third quarter to complement our current paper products and appeal to the
small business segment of our markets.

     Management believes that sales pending from these products will enhance the
Company's financial results.

Business Process and Controls Review

     During the second quarter, the Company engaged KPMG Vancouver British
Columbia ("KPMG") to review its business processes and controls. KPMG completed
the review and supplied management with recommendations to enhance the Company's
internal control systems. Management is taking steps to address the control
weaknesses identified by KPMG and disclosed in previous public filings.

ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K

     (a)  Exhibits.

          10.1 Selling Agent Agreement dated as of October 5, 1999, between the
               Company and Culverwell & Co., Inc., filed herewith.


                                      -5-
<PAGE>   8


          10.2 Amendment to Selling Agent Agreement dated as of October 14,
               1999, between the Company and Culverwell & Co., Inc.

          10.3 Commitment Letter from US Bank dated October 19, 1999.

          27.1 Financial Data Schedule for the quarter ended September 30, 1999.

     (b)  There were no reports on Form 8-K filed during the quarter ended
September 30, 1999.

SIGNATURE

     Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this Report to be signed on
its behalf by the undersigned, thereunto duly authorized on this 11th day of
November, 1999.

     GEOGRAPHICS, INC.



By:  /s/ James L. Dorman
     ---------------------------------
     James L. Dorman
     Chairman, Chief Executive Officer


By:  /s/ William J. Paquin, Jr.
     ---------------------------------
     William J. Paquin, Jr.
     Controller

















                                      -6-
<PAGE>   9



                                GEOGRAPHICS, INC.
                                    FORM 10-Q
                                  EXHIBIT INDEX
                    FOR THE QUARTER ENDED SEPTEMBER 30, 1999


<TABLE>
<CAPTION>
Exhibit
Number
------
<S>       <C>
10.1      Selling Agent Agreement dated as of October 5, 1999, between the
          Company and Culverwell & Co., filed herewith.

10.2      Amendment to Selling Agent Agreement dated as of October 14, 1999,
          between the Company and Culverwell & Co., Inc.

10.3      Commitment Letter from US Bank dated October 19, 1999.

27.1      Financial Data Schedule
</TABLE>

<PAGE>   10
                                GEOGRAPHICS, INC
                           CONSOLIDATED BALANCE SHEET
                   AS OF SEPTEMBER 30, 1999 AND MARCH 31, 1999
                                   (UNAUDITED)


<TABLE>
<CAPTION>
                                     ASSETS
                                                                                 SEPTEMBER 30, 1999  MARCH 31, 1999
                                                                                 ------------------  --------------
<S>                                                                              <C>               <C>
CURRENT ASSETS
  Cash                                                                           $    168,549      $    130,967
  Accounts receivable
    Trade receivables, net                                                          4,847,099         3,187,527
    Other receivables                                                                 133,700           261,091
Inventory, net of allowance for obsolete inventory of
  $644,000 and $862,000 at September 30 and March 31, 1999 respectively             4,023,553         3,532,684
Prepaid expenses, deposits, and other current assets                                  579,935           853,357
                                                                                 ------------      ------------
        Total current assets                                                        9,752,836         7,965,626

PROPERTY, PLANT AND EQUIPMENT, NET                                                  9,598,314         9,945,634

OTHER ASSETS                                                                          763,122           367,501
                                                                                 ------------      ------------
TOTAL ASSETS                                                                     $ 20,114,272      $ 18,278,761
                                                                                 ============      ============
                 LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES
  Bank overdrafts                                                                $    167,275      $    253,425
  Note payable to bank                                                              3,406,993         4,896,912
  Accounts payable                                                                  3,681,100         2,961,079
  Accrued liabilities                                                               1,626,655         2,496,178
  Current portion of long-term debt                                                 3,122,038         3,072,601
                                                                                 ------------      ------------
        Total current liabilities                                                  12,004,061        13,680,195

LONG-TERM DEBT                                                                      3,034,188         3,776,432
                                                                                 ------------      ------------
        Total liabilities                                                          15,038,249        17,456,627
                                                                                 ============      ============
STOCKHOLDERS' EQUITY (DEFICIT)
  No par common stock - 100,000,000 authorized, 25,415,589 and 9,857,252
       issued and outstanding at September 30 and March 31, 1999 respectively      20,169,946        15,769,018
Accumulated other comprehensive income                                               (211,326)         (157,223)
Accumulated deficit                                                               (14,882,597)      (14,789,661)
                                                                                 ------------      ------------
        Total stockholders'equity (deficit)                                         5,076,023           822,134
                                                                                 ------------      ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)                             $ 20,114,272      $ 18,278,761
                                                                                 ============      ============
</TABLE>




                                      F-1
<PAGE>   11


                                GEOGRAPHICS, INC
                      CONSOLIDATED STATEMENT OF OPERATIONS
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                         THREE MONTHS ENDED              SIX MONTHS ENDED
                                                            SEPTEMBER 30,                  SEPTEMBER 30,
                                                        1999            1998            1999           1998
                                                    ------------    -----------    ------------    ------------
<S>                                                 <C>             <C>            <C>             <C>
Sales                                               $  8,130,428    $ 5,679,206    $ 13,675,844    $ 11,839,590
  Allowances and Credits                              (1,085,933)      (646,442)     (1,879,488)     (1,209,258)
  Sales Returns                                         (452,194)      (355,494)       (704,137)       (455,900)
                                                    ------------    -----------    ------------    ------------
      Net Sales                                        6,592,301      4,677,270      11,092,219      10,174,432

Cost of Sales                                          5,002,103      2,896,186       8,498,472       6,400,030
                                                    ------------    -----------    ------------    ------------
  Gross Margin                                         1,590,198      1,781,084       2,593,747       3,774,402

S.G.& A. Expenses                                      1,457,760      1,343,037       2,575,865       2,868,209
                                                    ------------    -----------    ------------    ------------
  Operating Income (Loss)                                132,438        438,047          17,882         906,193

Other Income (Expense)
  Interest Expense                                      (183,824)      (270,429)       (421,569)       (607,909)
  Other Income (Expense)                                 137,279        (24,641)        309,671         (40,214)
                                                    ------------    -----------    ------------    ------------
      Total Other Income (Expense)                       (46,545)      (295,070)       (111,898)       (648,123)

Net Income (Loss) Before Tax                              85,893        142,977         (94,016)        258,070

Discontinued Operations
  Income from and gain on disposal of Core Business            -              -               -       5,657,580

Federal Income Tax Benefit                                     -              -               -               -
                                                    ------------    -----------    ------------    ------------
Net Income (Loss)                                   $     85,893    $   142,977    $    (94,016)   $  5,915,650
                                                    ============    ===========    ============    ============
Earnings Per Common and Common Equivalent Share
  Basic                                             $     0.0057    $    0.0145    $    (0.0076)   $     0.6001
  Diluted                                           $     0.0056    $    0.0145    $    (0.0073)   $     0.6001

Shares Used in Computing Earnings per Common and
Common Equivalent Share
  Basic                                               15,043,364      9,857,252      12,450,308       9,857,252
  Diluted                                             15,422,953      9,857,252      12,829,897       9,857,252
</TABLE>


                                      F-2
<PAGE>   12


                               GEOGRAPHICS, INC.
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                                  (UNAUDITED)
<TABLE>
<CAPTION>
                                                          SIX MONTHS       ENDED
                                                         SEPTEMBER 30,  SEPTEMBER 30,
                                                             1999           1998
                                                         -----------    -----------
<S>                                                      <C>            <C>
CASH FLOWS FROM OPERATING ACTIVITIES
  Net income (loss)                                      $   (94,016)   $ 5,915,650
Adjustments to reconcile net income (loss) to net
cash flows from operating activities
  Depreciation and amortization                              652,148        888,177
  (Gain) loss on sale/disposal of property and equipment       1,770              -
Changes in noncash operating assets and liabilities
  Trade receivables                                       (1,659,572)      (221,805)
  Other receivables                                          127,391       (123,287)
  Inventory                                                 (490,869)     1,123,223
  Prepaid expenses, deposits and current assets              273,422         52,826
  Accounts payable                                           720,021       (178,927)
  Accured liabilities                                       (861,594)      (252,477)
                                                         -----------    -----------
     Net cash flows from operating activities             (1,331,299)     7,203,380

CASH FLOWS FROM FINANCING ACTIVITIES
  Decrease in bank overdrafts                                (93,150)       (69,527)
  Net borrowings on note payable to bank                  (1,489,919)    (6,423,408)
  Repayment of long-term debt                               (692,807)      (668,565)
  Proceeds from notes payable to officers and directors      100,000              -
  Repayment of notes payable to officers and directors      (100,000)             -
  Proceeds from the issuance of common stock               4,200,648              -
  Proceeds from the issuance of common stock for assets      200,280              -
  Net change, foreign currency translation                   (54,102)       (33,899)
                                                          ----------     ----------
     Net cash flows from financing activities              2,070,950     (7,195,399)

CASH FLOWS FROM INVESTING ACTIVITIES
  Purchase of plant and equipment                           (160,738)       (76,508)
  Purchase of Innovative Storage Design Assets              (261,163)             -
  Increase in other assets                                  (280,168)       (42,158)
                                                          ----------     ----------
     Net cash flows from investing activities               (702,069)      (118,666)

NET CHANGE IN CASH                                            37,582       (110,684)
CASH, BEGINNING OF PERIOD                                    130,967        316,078
                                                         -----------    -----------
CASH, END OF PERIOD                                      $   168,549    $   205,394
                                                         -----------    -----------
</TABLE>



                                      F-3
<PAGE>   13

NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     The accompanying interim unaudited consolidated financial statements of
Geographics, Inc. (the "Company" or "Geographics") have been prepared in
accordance with generally accepted accounting principles for interim financial
information and with the instructions to Form 10-Q and Article 10 of Regulation
S-X. Accordingly, they do not include all of the information and footnotes
required by generally accepted accounting principles for complete financial
statements. In the opinion of management, such interim statements reflect all
adjustments (consisting of normal recurring accruals) necessary to present
fairly the financial position and the results of operations and cash flows for
the interim periods presented. The results of operations for these interim
periods are not necessarily indicative of the results to be expected for the
full year. These statements should be read in conjunction with the audited
consolidated financial statements and footnotes included in the Company's
consolidated financial statements and notes thereto for the fiscal year ended
March 31, 1999.

     The consolidated financial statements include the accounts of Geographics
and its wholly-owned subsidiaries: Geographics Marketing Canada Inc.,
Geographics (Europe) Limited and Geographics Australia, Pty. Limited. All
intercompany balances and transactions have been eliminated.










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