<PAGE>   1

================================================================================






                       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 quarterly period ended September 30, 1997


                        Commission File Number: 333-10611

                               UNIFRAX CORPORATION
             (Exact name of registrant as specified in its charter)


         Delaware                                     34-1535916
(State or other jurisdiction                       (I.R.S. Employer
 of incorporation)                                 Identification No.)

               2351 Whirlpool Street, Niagara Falls, NY 14305-2413
               (Address of principal executive offices) (Zip Code)
       Registrant's telephone number, including area code: (716) 278-3800
                   -------------------------------------------




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









================================================================================





<PAGE>   2
<TABLE>
<CAPTION>



                               UNIFRAX CORPORATION
                                    FORM 10-Q
                                      INDEX

                                                                                           Page No.
                                                                                           --------
<S>       <C>                                                                              <C>
PART I.   FINANCIAL INFORMATION

Item 1.   Condensed Financial Statements (Unaudited)

          Condensed Consolidated Balance Sheets at
               September 30, 1997 and December 31, 1996......................................1

          Condensed Consolidated Statements of Income for the
               Three-month and nine-month periods ended September 30, 1997 and 1996..........2

          Condensed Consolidated Statements of Cash Flow for the
               Nine-months ended September 30, 1997 and 1996.................................3

          Notes to Condensed Consolidated Financial Statements...............................4

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

PART II.  OTHER INFORMATION

Item 1.   Legal Proceedings.................................................................12
Item 2.   Changes in Securities.............................................................12
Item 3.   Defaults on Senior Securities.....................................................12
Item 4.   Submission of Matters to a Vote of Security Holders ..............................12
Item 5.   Other Information.................................................................12
Item 6.   Exhibits and Report on Form 8-K...................................................12

Signatures..................................................................................15
</TABLE>




<PAGE>   3
<TABLE>
<CAPTION>



PART I.   FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

                                                    UNIFRAX CORPORATION
                                           CONDENSED CONSOLIDATED BALANCE SHEETS
                                       (UNAUDITED - IN THOUSANDS, EXCEPT SHARE DATA)

                                                                                      December 31       September 30
                                                                                         1996               1997
                                                                                         ----               ----
<S>                                                                                    <C>               <C>
ASSETS
Current assets:
     Cash                                                                              $     898         $      3
     Accounts receivable, less allowances of $1,202
         and $1,128, respectively                                                         13,856           13,202
     Inventories                                                                          10,091            8,336
     Deferred income taxes                                                                 5,395            5,395
     Prepaid expenses and other current assets                                               294              525
                                                                                        --------         --------
Total current assets                                                                      30,534           27,461

Property, plant and equipment, at cost                                                    64,113           69,809
     Less accumulated depreciation and amortization                                      (30,174)         (32,623)
                                                                                        --------         --------
                                                                                          33,939           37,186

Deferred income taxes                                                                     23,576           21,253
Organization costs, net of accumulated amortization
     of $129 and $688, respectively                                                        4,792            4,217
Other assets                                                                                 550              413
                                                                                        --------         --------
                                                                                        $ 93,391         $ 90,530
                                                                                        --------         --------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
     Accounts payable                                                                    $ 5,831          $ 3,283
     Accrued expenses                                                                      8,431           10,949
     Amounts due affiliates                                                                2,250               --
     Short term debt                                                                          --              300
                                                                                        --------         --------
Total current liabilities                                                                 16,512           14,532
Long term debt                                                                           120,750          113,750
Note payable--affiliate                                                                    7,000            7,000
Accrued postretirement benefit cost                                                        2,957            3,146
Other long-term obligations                                                                  236              578
                                                                                        --------         --------
Total liabilities                                                                        147,455          139,006

STOCKHOLDERS' DEFICIT
Common stock--$.01 par value; shares authorized--(40,000 - September  30, 1997,
     50,000 - December 31, 1996) shares issued and outstanding--20,000                       --               --
Cumulative preferred stock--$.01 par value; shares authorized--10,000,
     shares issued and outstanding--1,500                                                    --               --
Additional paid-in capital                                                                40,020           42,270
Accumulated deficit                                                                      (93,971)         (90,469)
Cumulative translation adjustment                                                           (113)            (277)
                                                                                        --------         --------
Total stockholders' deficit                                                              (54,064)         (48,476)
                                                                                        --------         --------
                                                                                        $ 93,391         $ 90,530
                                                                                        ========         ========
</TABLE>

See accompanying notes to condensed consolidated financial statements.

                                        1

<PAGE>   4

<TABLE>
<CAPTION>



                               UNIFRAX CORPORATION

                   CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                           (UNAUDITED - IN THOUSANDS)



                                           THREE MONTHS ENDED SEPTEMBER  30             NINE MONTHS ENDED SEPTEMBER 30
                                           --------------------------------             ------------------------------
                                                 1996              1997                       1996             1997
                                                 ----              ----                       ----             ----

<S>                                           <C>               <C>                        <C>              <C>
Net Sales                                     $22,769           $20,533                    $67,961          $65,234

Cost of goods sold                             11,496            10,112                     34,075           33,135
                                              -------           -------                    -------           ------
Gross profit                                   11,273            10,421                     33,886           32,099

Selling and distribution expenses               3,244             3,108                      9,662            9,515
Administration expenses                         1,616             1,392                      5,045            5,310
Allocated corporate charges                       --                 --                        356              --
Research and development expenses                 597               606                      1,718            1,955
                                              -------           -------                    -------           ------

Operating income                                5,816             5,315                     17,105           15,319

Interest expense                                   --            (3,118)                        --           (9,462)
Other income (expense), net                        17               (10)                        60               67
                                              -------           -------                    -------           ------

Income before income taxes                      5,833             2,187                     17,165            5,924
Provision for income taxes                      2,437               892                      7,134            2,421
                                              -------           -------                    -------           ------

NET INCOME                                    $ 3,396           $ 1,295                    $10,031           $3,503
                                              =======           -------                    =======           ------ 

</TABLE>

See accompanying notes to condensed consolidated financial statements.





                                        2

<PAGE>   5

<TABLE>
<CAPTION>


                               UNIFRAX CORPORATION

                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                           (UNAUDITED - IN THOUSANDS)

                                                                                    NINE MONTHS ENDED SEPTEMBER 30
                                                                                    ------------------------------
                                                                                        1996               1997
                                                                                        ----               ----
<S>                                                                                   <C>                 <C>
OPERATING ACTIVITIES
Net income                                                                            $10,031             $ 3,503
Depreciation and amortization                                                           2,935               3,838
Other adjustments and changes in operating assets and liabilities                        (953)              5,398
                                                                                      -------             -------
Cash provided by operating activities                                                  12,013              12,739

INVESTING ACTIVITIES
Capital expenditures                                                                   (5,148)             (7,063)
Deferred software and other costs                                                        (322)                 14
Proceeds from sales of property, plant and equipment                                       65                 115
                                                                                      -------             -------
Cash used in investing activities                                                      (5,405)             (6,934)

FINANCING ACTIVITIES
Cash transfers from parent company, net                                                (5,686)                --
Borrowings under revolving loan agreement                                                 --                  300
Repayment of term loan                                                                    --               (7,000)
                                                                                      -------             -------
Cash used in financing activities                                                      (5,686)             (6,700)

Net decrease in cash                                                                      922                (895)
Cash--beginning of period                                                                  37                 898
                                                                                      -------             -------
CASH--END OF PERIOD                                                                   $   959             $     3
                                                                                      =======             =======

See accompanying notes to condensed consolidated financial statements.
</TABLE>



                                        3

<PAGE>   6



                               UNIFRAX CORPORATION
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               SEPTEMBER 30, 1997


NOTE A - BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements of
Unifrax Corporation ("The Company" or "Unifrax") 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, all adjustments (consisting only of
normal recurring accruals) considered necessary for a fair presentation of the
results for the interim period ended September 30, 1997, have been included.
Operating results for the three- and nine-month periods ended September 30,
1997, are not necessarily indicative of the results that may be expected for the
year ending December 31, 1997. For further information, refer to the
consolidated financial statements and the notes to consolidated financial
statements included in the Company's annual report on Form 10-K for the year
ended December 31, 1996, as filed with the Securities and Exchange Commission,
which are incorporated herein by reference. All capitalized terms used in these
notes to condensed consolidated financial statements that are not defined herein
have the meanings given to them in such consolidated financial statements and
notes to consolidated financial statements.

NOTE B - INVENTORIES

The components of inventory consist of the following (in thousands):
<TABLE>
<CAPTION>

                                                                       December 31             September 30
                                                                           1996                     1997
                                                                       -----------             ------------

<S>                                                                       <C>                       <C>   
                  Raw materials and supplies                              $1,722                    $1,324
                  Work in process                                          1,758                     2,012
                  Finished products                                        6,041                     4,731
                                                                         -------                    ------
                                                                           9,521                     8,067
                  Adjustment to LIFO Cost                                    570                       269
                                                                         -------                    ------
                                                                         $10,091                    $8,336
                                                                         =======                    ====== 

</TABLE>


                                        4

<PAGE>   7



NOTE C - CONTINGENCIES

CERAMIC FIBERS

Regulatory agencies and others, including the Company, are currently conducting
scientific research to determine the potential health impact resulting from the
inhalation of airborne ceramic fibers. To date, the results of this research
have been inconclusive as to whether or not ceramic fiber exposure presents an
unreasonable risk to humans.

Various legal proceedings and claims have been made against manufacturers of
ceramic fibers, including the Company, alleging death or personal injury as a
result of exposure in the manufacture and handling of ceramic fiber and other
products. The amount of any liability that might ultimately exist with respect
to these claims is presently not determinable.

Consistent with customary practice among manufacturers of ceramic fiber
products, the Company has entered into agreements with distributors of its
product whereby the Company has agreed to indemnify the distributors against
losses resulting from ceramic fiber claims and the costs to defend against such
claims. The amount of any liability that might ultimately exist with respect to
these indemnities is presently not determinable.

Pursuant to the Unifrax Corporation Recapitalization Agreement
("Recapitalization Agreement"), BP America Inc. and certain of its affiliates
(collectively "BPA"), has agreed to indemnify the Company against liabilities
for personal injury and wrongful death attributable to exposure prior to the
Closing to refractory ceramic fibers manufactured by the Company. BPA has agreed
to indemnify the Company against all liabilities arising from exposure claims
pending at the time of the Closing. For all other claims arising from alleged
exposure occurring solely prior to Closing, BPA has agreed to indemnify the
Company against 80% of all losses, until the total loss which the Company incurs
reaches $3.0 million, after which time BPA has agreed to indemnify the Company
against 100% of such losses. BPA has agreed to indemnify the Company against all
punitive damages attributable to the conduct of the Company prior to Closing.
Where losses arise from alleged exposure both before and after Closing, the
losses will be allocated between BPA and the Company, pro rata, based on the
length of exposure or pursuant to arbitration if initiated by the Company.

The Company cannot avail itself of this indemnity for losses attributable to the
Company's failure to maintain a Product Stewardship Program consistent with the
program maintained by the Company prior to Closing, as modified in a
commercially reasonable manner in accordance with changing regulatory,
scientific and technical factors. BP shall not indemnify the Company with
respect to any liabilities for wrongful death or personal injury to the extent
caused by the failure of the Company to maintain a Product Stewardship Program
consistent with that maintained by the Company prior to the Closing.

ENVIRONMENTAL MATTERS

The Company is subject to loss contingencies pursuant to various federal, state
and local environmental laws and regulations. These include possible obligations
to remove or mitigate the effects on the environment of the placement, storage,
disposal or release of certain chemical or petroleum substances by the Company
or by other parties.



                                        5

<PAGE>   8



Under the terms of the Recapitalization Agreement, BPA assumed liability, and
the rights to recovery from third parties, for environmental remediation and
other similar required actions with respect to certain environmental obligations
of Unifrax existing as of the Closing Date.

The Company may, in the future, be involved in further environmental assessments
or clean-ups. While the ultimate requirement for any such remediation, and its
cost, is presently not known, and while the amount of any future costs could be
material to the results of operations in the period in which they are
recognized, the Company does not expect these costs, based upon currently known
information and existing requirements, to have a material adverse effect on its
financial position.

The Company owned a site in Sanborn, NY, at which extensive remediation activity
is currently being undertaken. The site has been used by a number of former
Carborundum operations other than the Company, as a result of which, certain
contamination is present in the soil. Neither past nor current operations of the
Company are believed to have contributed to, or to be contributing to, the
existence of the contamination. BPA has assumed responsibility for implementing
remedial activities specified by the State of New York which required removal of
the contamination, chiefly by means of soil vapor extraction. Under the terms of
an agreement, BPA has taken title to and assumed liability for the remediation
of this property as of October 30, 1996. Unifrax leases a portion of the present
manufacturing facilities on this site.

LEGAL PROCEEDINGS

The Company is involved in litigation relating to claims arising out of its
operations in the normal course of business, including product liability claims.
From time to time the Company has been named as a defendant in lawsuits
involving alleged injury suffered from exposure to ceramic fiber. The Company
believes that it is not presently a party to any litigation the outcome of which
would have a material adverse effect on its financial condition or results of
operations. Pursuant to the Recapitalization Agreement, BPA agreed to indemnify
the Company, subject to certain limitations, against all currently known
lawsuits and certain future lawsuits alleging exposure to ceramic fiber
(reference is made to the information appearing under the heading "Relationship
with BP and its Subsidiaries" in Item 13 of the report on Form 10-K for the
Unifrax Corporation for the year 1996 which is hereby incorporated herein by
reference).

Various other legal proceedings and claims have been made against the Company in
the ordinary course of business. While the amounts could be material to the
results of operations in the period recognized, in the opinion of management of
the Company, the ultimate liability, if any, resulting from such matters will
not have a material adverse effect on the Company's financial position.

NOTE D - COMMON STOCK

Effective April 21, 1997, the shareholders of Unifrax Corporation authorized an
amendment to the Certificate of Incorporation of Unifrax Corporation reducing
the number of authorized common shares from 50,000 shares to 40,000 shares.




                                        6

<PAGE>   9



NOTE E - CUMULATIVE PREFERRED STOCK

Effective April 21, 1997, the shareholders of Unifrax Corporation authorized an
amendment to the Certificate of Incorporation of Unifrax Corporation creating
10,000 shares of cumulative preferred stock with a 6% annual dividend.

Effective September 30, 1997, Unifrax Corporation issued and sold 1,500 shares
of 6% cumulative preferred stock of the Company to Unifrax Holding Co. in
satisfaction of an advance of $2.25 million made by Unifrax Holding Co. to the
Company on December 20, 1996. The advance was then canceled effective September
30, 1997. The preferred stock thereby acquired by Unifrax Holding Co. is
cumulative with an annual dividend of 6% with dividend payments subject to
various covenants in the Company's loan agreements.

Unifrax Corporation also agreed to sell BP Exploration (Alaska) Inc. 166.67
shares of 6% cumulative preferred stock at $1,500 per share, as satisfaction in
part for interest owed through October 30, 1997, on the Note Payable-affiliate.

NOTE F - EFFECTS OF NEW ACCOUNTING PRONOUNCEMENTS

In June 1997, the Financial Accounting Standards Board issued Statement No. 130,
"Reporting Comprehensive Income", which is effective for fiscal years beginning
after December 15, 1997. The Company has not yet determined the impact Statement
No. 130 will have on its financial statements.

In June 1997, the Financial Accounting Standards Board issued Statement No. 131,
"Disclosure about Segments of an Enterprise and Related Information", which is
effective for fiscal years beginning after December 15, 1997. The Company does
not expect that Statement No. 131 will have any material effect on its financial
statements.


                                        7

<PAGE>   10



PART I.    FINANCIAL INFORMATION

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

           The Management's Discussion and Analysis of Financial Condition and
           Results of Operations contained in the Company's Form 10-K annual
           report for the year ended December 31, 1996 and Form 10-Qs for the
           three months ended March 31, 1997, and June 30, 1997, as filed with
           the Securities and Exchange Commission (the "MDA") are hereby
           incorporated by reference. All capitalized terms used in this Item 2
           that are not defined herein have the meanings given to them in the
           MDA.

           Three Months Ended September 30, 1997 Compared With Three Months
           ----------------------------------------------------------------
           Ended September 30, 1996
           ------------------------

           Prior to February 29, 1996, Unifrax Corporation ("The Company" or
           "Unifrax") was known as The Carborundum Company ("Carborundum") and
           included a number of divisions and subsidiaries engaged in various
           manufacturing businesses. On February 29, 1996, all of the
           Carborundum businesses except for Unifrax were sold to Societe
           Europeenne des Produits Refractaires and various other units of
           Companie de Saint Gobain. Concurrent with the Saint Gobain sale,
           Carborundum was renamed Unifrax, which was comprised of the North
           American Fibers Division of Carborundum. Prior to February 29, 1996,
           Unifrax sold its XPE products to Carborundum operations in Europe and
           Brazil, who then sold to the end market. Subsequent to the Saint
           Gobain Sale, Unifrax sold these products through indirect wholly
           owned subsidiaries of BP in Europe (XPE Vertriebs GmbH) and South
           America (NAF Brasil Ltda). In connection with the Recapitalization,
           these subsidiaries became subsidiaries of Unifrax.

           The results for the third quarter of 1997 also reflect the
           Recapitalization of Unifrax on October 30, 1996, and the resulting
           revised structure of the company. For further information regarding
           the Recapitalization, refer to the consolidated financial statements
           and footnotes thereto included in the Company's annual report on Form
           10-K for the year ended December 31, 1996.

           Net sales for the third quarter of 1997 decreased by $2.3 million or
           10.0% from $22.8 million in 1996 to $20.5 million in 1997. Strong
           demand for bulk fibers to the automotive, metals, and specialties
           sectors and growth in specialty products for fire protection were
           offset by lower sales in some traditional blanket applications and in
           porosity-controlled products due to continuing end user program
           design changes and modifications.

           Gross profit declined by $0.9 million, or 8.0%, from $11.3 million in
           1996 to $10.4 million in 1997. Gross profit as a percentage of net
           sales increased from 49.5% in 1996 to 50.8% in 1997. The gross profit
           decline was due to the lower sales volume and downward pressure on
           prices in the automotive market. As a percentage of sales, gross
           profit increased due to fewer outside purchases and resales of
           ceramic fiber.



                                        8

<PAGE>   11



           Selling and distribution expenses decreased by $0.1 million, or 3.1%,
           from $3.2 million in 1996 to $3.1 million in 1997 as a result of the
           lower sales volume. Selling and distribution expense as a percentage
           of net sales increased slightly from 14.3% in 1996 to 15.1% in 1997.

           Administration expenses decreased by $0.2 million, or 12.5%, from
           $1.6 million in 1996 to $1.4 million in 1997. The lower
           administration costs were offset in part by the amortization of
           organization and financing costs associated with the
           Recapitalization. Administrative expenses as a percentage of net
           sales were 7.1 % in 1996 and 6.8% in 1997.

           Research and development expenses remained constant in 1996 and 1997,
           increasing as a percentage of net sales from 2.6% in 1996 to 3.0% in
           1997, due to the lower sales in 1997.

           Operating income decreased by $0.5 million, or 8.6%, from $5.8
           million in 1996 to $5.3 million in 1997. Operating income as a
           percentage of net sales increased from 25.5% in 1996 to 25.9% in
           1997, as a result of the factors previously indicated.

           Interest expense was $3.1 million in 1997, compared to zero in 1996
           as a result of borrowings in connection with the Recapitalization.
           Interest expense as a percentage of net sales was 15.2% in 1997.

           Provision for income taxes decreased $1.5 million, or 62.5%, from
           $2.4 million in 1996 to $0.9 million in 1997. The effective income
           tax rate decreased from 41.8% in 1996 to 40.8% in 1997, primarily as
           a result of lower losses in the foreign subsidiaries, with no
           increase in tax liability.

           Net income decreased by $2.1 million, or 61.8%, from $3.4 million in
           1996 to $1.3 million in 1997, as a result of factors previously
           indicated. Net income as a percentage of net sales decreased from
           14.9% in 1996 to 6.3% in 1997.


                                        9

<PAGE>   12



           NINE MONTHS ENDED SEPTEMBER 30, 1997 COMPARED WITH NINE MONTHS ENDED
           --------------------------------------------------------------------
           SEPTEMBER 30, 1996
           ------------------

           Net sales for the first nine months of 1997 decreased by $2.8 million
           or 4.1% from $68.0 million in 1996 to $65.2 million in 1997. Strong
           demand for bulk fibers to the automotive, metals, and specialties
           sectors and growth in specialty products for fire protection were
           offset by lower sales in some traditional blanket applications and in
           porosity-controlled products due to continuing end user program
           design changes and modifications.

           Gross profit declined by $1.8 million, or 5.3%, from $33.9 million in
           1996 to $32.1 million in 1997. Gross profit as a percentage of net
           sales decreased from 49.9% in 1996 to 49.2% in 1997. The decline was
           due to the lower sales volume and downward pressure on prices in the
           automotive market.

           Selling and distribution expenses decreased by $0.2 million or 2.1%,
           from $9.7 million in 1996 to $9.5 million in 1997 as a result of
           lower sales volume. Selling and distribution expense as a percentage
           of net sales were 14.2% in 1996 and 14.6% in 1997.

           Administration expenses and allocated corporate charges decreased by
           $0.1 million or 1.9% from $5.4 in 1996 to $5.3 million in 1997.
           Administration expenses as a percentage of net sales were 8.0% in
           1996 and 8.1% in 1997.

           Research and development expenses increased by $0.3 million or 17.7%
           from $1.7 million in 1996 to $2.0 million in 1997. The higher expense
           was due to a planned increase in testing and development expenditures
           for automotive products, and for the development of new fibers.
           Research and development expenses as a percentage of net sales were
           2.5% in 1996 and 3.0% in 1997.

           Operating income decreased by $1.8 million, or 10.5%, from $17.1
           million in 1996 to $15.3 million in 1997. Operating income as a
           percentage of net sales decreased from 25.2% in 1996 to 23.5% in
           1997, as a result of the factors previously indicated.

           Interest expense was $9.5 million in 1997, compared to zero in 1996
           as a result of borrowings in connection with the Recapitalization.
           Interest expense as a percentage of net sales was 14.5% in 1997.

           Provision for income taxes decreased $4.7 million, or 66.2%, from
           $7.1 million in 1996 to $2.4 million in 1997. The effective income
           tax rate decreased from 41.5% in 1996 to 40.9% in 1997, primarily as
           a result of lower losses in the foreign subsidiaries, with no
           increase in tax liability.

           Net income decreased by $6.5 million, or 65.0%, from $10.0 million in
           1996 to $3.5 million in 1997, as a result of factors previously
           indicated. Net income as a percentage of net sales decreased from
           14.8% in 1996 to 5.4% in 1997.



                                       10

<PAGE>   13



           Liquidity and Capital Resources
           -------------------------------

           During the nine-month period ended September 30, 1997, the Company's
           cash flows from operating activities increased by $0.7 million or
           5.8%, from $12.0 million in 1996 to $12.7 million in 1997. This
           increase was the result of reductions in the levels of working
           capital and higher depreciation and amortization expense offset in
           part by lower net income resulting from interest expense in the
           period, lower sales volumes and other factors discussed previously.

           Cash outflows from investing activities increased by $1.5 million, or
           28.3%, from $5.4 million in 1996 to $6.9 million in 1997. This
           decrease was due to higher capital spending on the expansion project
           at the New Carlisle, Indiana, facility offset somewhat by lower
           capital spending at other facilities and reduced software
           expenditures.

           Cash outflows from financing activities increased by $1.0 million
           from $5.7 million in 1996 to $6.7 million in 1997. During 1997 the
           Company made a voluntary prepayment of principal of $7.0 million on
           its Term Loan and borrowed $0.3 million against its $20 million
           revolving credit facility. The $0.3 million borrowing was repaid in
           full during the first week of October, 1997.

           Management believes that cash flows from operations and the available
           credit facility will be sufficient to fund operating and capital
           expenditure needs for 1997.

           Effects of New Accounting Pronouncements
           ----------------------------------------

           In June 1997, the Financial Accounting Standards issued Statement No.
           130, "Reporting Comprehensive Income", which is effective for fiscal
           years beginning after December 15, 1997. The Company has not yet
           determined the impact Statement No. 130 will have on its financial
           statements.

           In June 1997, the Financial Accounting Standards Board issued
           Statement No. 131, "Disclosure about Segments of an Enterprise and
           Related Information", which is effective for fiscal years beginning
           after December 15, 1997. The Company does not expect that Statement
           No. 131 will have any material effect on its financial statements.




                                       11

<PAGE>   14



PART II.   OTHER INFORMATION

ITEM 1.      LEGAL PROCEEDINGS

             None.

ITEM 2.      CHANGES IN SECURITIES

             Note E of notes to the condensed consolidated financial statements
             included in this report is incorporated herein by reference.

ITEM 3.      DEFAULTS ON SENIOR SECURITIES

             None.

ITEM 4.      SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

             None.

ITEM 5.      OTHER INFORMATION

             None.

ITEM 6.      EXHIBITS AND REPORTS ON FORM 8-K

(a)          Exhibits
             --------

             2.1*         Unifrax Corporation Recapitalization Agreement

             3.1*         Certificate of Incorporation of the Registrant

             3.1a         Consent of Stockholders for Amendment of Certificate
                          of Incorporation

             3.1b         Certificate of Amendment to Certificate of
                          Incorporation

             3.2*         By-laws of the Registrant

             4.1*         Form of Indenture (including form of Note)

             10.1*        Form of Loan and Security Agreement among Unifrax
                          Corporation, Bank of America Illinois and the lenders
                          party thereto (Credit Agreement)

             10.1a**      First Amendment to Loan and Security Agreement

             10.2*        1996 Stock Option Plan

             10.2a**      Unifrax Corporation Noncompetition Agreement


                                       12

<PAGE>   15



             10.3*        Lease relating to Tonawanda plant

             10.4*        Lease relating to Amherst plant

             10.5*        Sanborn Lease

             10.6*        Covenant Not to Compete between The British Petroleum
                          Company p.l.c., its affiliates, and the Unifrax
                          Corporation and Societe Europeenne des Produits
                          Refractaires, and its affiliates (portions of this
                          Exhibit have been omitted and have been filed
                          separately with the Commission pursuant to a request
                          for confidential treatment)

             10.7*        Product Distribution Agreement between the Unifrax
                          Corporation and Societe Europeenne des Produits
                          Refractaires (portions of this Exhibit have been
                          omitted and have been filed separately with the
                          Commission pursuant to a request for confidential
                          treatment)

             10.8*        Distributed Product License Agreement between the
                          Unifrax Corporation and Societe Europeenne des
                          Produits Refractaires (portions of this Exhibit have
                          been omitted and have been filed separately with the
                          Commission pursuant to a request for confidential
                          treatment)

             10.9*        License Agreement between the Unifrax Corporation and
                          Societe Europeenne des Produits Refractaires (portions
                          of this Exhibit have been omitted and have been filed
                          separately with the Commission pursuant to a request
                          for confidential treatment)

             10.10*       Trademark License and Consent Agreement between the
                          Unifrax Corporation and Societe Europeenne des
                          Produits Refractaires

             10.11*       Conversion Agreement between the Unifrax Corporation
                          and Societe Europeenne des Produits Refractaires
                          (portions of this Exhibit have been omitted and will
                          be filed separately with the Commission pursuant to a
                          request for confidential treatment)

             10.12*       XPE(TM) License Agreement between the Unifrax
                          Corporation and Societe Europeenne des Produits
                          Refractaires

             10.13*       Form of Covenant Not to Compete between Holding and BP

             10.14*       Form of Stockholders Agreement among the Company, BPX
                          and Holding

             10.14a       Amendment to Stockholders Agreement dated September
                          30, 1997, among the Company, BP Exploration (Alaska),
                          Inc. and Holding

             10.14b       Stock Purchase Agreement dated September 30, 1997,
                          between the Company and Holding

             10.14c       Stock Purchase Agreement dated September 30, 1997,
                          between the Company and BP Exploration (Alaska), Inc.


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<PAGE>   16



             10.15*       Tax Sharing Agreement between the Company and Holding

             10.16*       Advisory Services Agreement between the Company and
                          Kirtland Capital Corporation

             10.17*       Form of BP Note

             21.1**       Subsidiaries of the Registrant

             27.1         Financial Data Schedule

              *      Incorporated by reference to the exhibits filed with the
                     Registration Statement on Form S-1 of Unifrax Investment
                     Corp. for 1996 for Unifrax Corporation (Registration No.
                     333-10611)

              **     Incorporated by reference to the exhibits filed with Form
                     10-K for 1996 for Unifrax Corporation (Registration No.
                     333-10611).

(b)          No reports on Form 8-K have been filed during the period covered by
             this report.

                                       14

<PAGE>   17



                                   SIGNATURES


             PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF
1934, THE REGISTRANT HAS DULY CAUSED THIS REPORT TO BE SIGNED ON ITS BEHALF BY
THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED.



                                              UNIFRAX CORPORATION



                                              By: /s/ William P. Kelly
                                                 ---------------------------
                                              William P. Kelly, President and
                                              Chief Executive Officer


                                              By: /s/ Mark D. Roos
                                              ------------------------------
                                              Mark D. Roos, Vice President
                                              and Chief Financial Officer



                                       15