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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.  20549

FORM 10-Q/A
(Amendment No. 1)

|(Mark   One) |  |                                                                                                                                               
|------------ |  | ----------------------------------------------------------------------------------------------------------------------------------------------
|x            |  | Quarterly   report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934   for the quarterly period ended March 31, 2006 or  
|             |  |                                                                                                                                               
|o            |  | Transition   report pursuant to section 13 or 15(d) of the Securities Exchange act of 1934   for the transition period from _______ to _______

Commission file number 1-10776

|CALGON   CARBON CORPORATION                           
|------------------------------------------------------
|                                                      
|(Exact name of registrant as specified in its charter)

|Delaware                                                         |  | 25-0530110                            
|---------------------------------------------------------------- |  | --------------------------------------
|                                                                 |  |                                       
|(State or other jurisdiction of   incorporation or organization) |  | (I.R.S. Employer   Identification No.)
|                                                                 |  |                                       

|P.O. Box 717, Pittsburgh, PA 15230-0717                                            
|-----------------------------------------------------------------------------------
|                                                                                   
|(Address of principal executive offices)                                           
|(Zip Code)                                                                         
|                                                                                   
|(412) 787-6700                                                                     
|                                                                                   
|(Registrants telephone number, including area code)                               
|                                                                                   
|                                                                                   
|                                                                                   
|(Former name, former address and former fiscal year if   changed 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 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
o | No
x
|----- | ----

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer.  See definition of accelerated filer and large accelerated filer in Rule 12b-2 of the Exchange Act.

|Large   accelerated filer
o |  | Accelerated   filer
x |  | Non-accelerated   filer
o
|--------------------------- |  | --------------------- |  | -------------------------

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Securities Exchange Act of 1934).

|Yes
o | No
x
|----- | ----

Applicable only to corporate issuers:Indicate the number of shares outstanding of each of the issuers classes of common stock, as of the latest practicable date.

|Class                          |  | Outstanding   at May 9, 2006
|------------------------------ |  | ----------------------------
|                               |  |                             
|Common   Stock, $.01 par value |  | 39,712,438   shares         
|                               |  |                             
|                              



CALGON CARBON CORPORATION FORM 10-Q/A QUARTER ENDED MARCH 31, 2006

EXPLANATORY NOTE

This Amendment No. 1 on Form 10-Q/A for Calgon Carbon Corporation, (the Company) for the three month period ended March 31, 2006 is being filed to amend and restate the item described below contained in the Companys Quarterly Report on Form 10-Q for such period originally filed with the Securities and Exchange Commission on May 10, 2006.  On October 30, 2006, management and the Audit Committee of the Company determined that the Unaudited Condensed Consolidated Financial Statements for the fiscal quarter ended March 31, 2006 that have been included in the Companys Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on May 10, 2006 contained errors and should no longer be relied upon.

The Company identified an error which resulted in an understatement of the Companys income taxes related to discontinued operations as well as an overstatement of the Companys income taxes that related to continuing operations for the three months ended March 31, 2006.  The error was made in the calculation of the Companys tax provision for the quarter ended March 31, 2006.

As a result, the accompanying Condensed Consolidated Financial Statements for the three month period ended March 31, 2006 have been restated from the amounts previously reported.  The effect of the restatement for the three month period ended March 31, 2006 is to increase the benefit for income taxes and decrease loss from continuing operations by $29 thousand, respectively; reduce income from discontinued operations  net of tax by $1.4 million, and increase net loss by $1.4 million.  Income from discontinued operations per common share decreased by $0.04 and basic and diluted net loss per common share decreased by $0.04.

This Amendment No. 1 amends Part I, Item 1, Financial Statements; Item 2, Managements Discussion and Analysis of Results of Operations and Financial Condition; and Item 4, Controls and Procedures as follows:

| |  | To amend Part I, Item 1,   Financial Statements, to restate the Companys Unaudited Condensed   Consolidated Financial Statements for the three month period ended March 31,   2006;                  
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |   |                                                                                                                                                                                                       
| |  | To amend Part I, Item 2,   Managements Discussion and Analysis    of Results of Operations and Financial Condition, to take into account   the effects of the restatement; and                       
| |   |                                                                                                                                                                                                       
| |  | To amend Part I, Item 4,   Controls and Procedures, to discuss the effects of the restatement on   managements evaluation of the effectiveness of the Companys disclosure controls   and procedures.

Pursuant to SEC Rule 12b-15, this Form 10-Q/A sets forth the complete text of each item of Form 10-Q listed above as amended, and includes, as Exhibits 31 and 32, new certifications by the Chief Executive Officer and Chief Financial Officer.

In order to preserve the nature and character of the disclosures set forth in such items as originally filed, this Amendment No. 1 does not reflect events occurring after the filing of the original Quarterly Report on Form 10-Q on May 10, 2006, or modify or update the disclosures presented in the original Quarterly Report on Form 10-Q, except to reflect the revisions as described above.  Accordingly, this Form 10-Q/A should be read in conjunction with our 2005 Form 10-K and our filings made subsequent to the filing of the original Form 10-Q, including any amendments to those filings.

Additional detail regarding the restatement is included in Note 16 of the Notes to the Unaudited Condensed Consolidated Financial Statements included in Part I, Item 1 of this Amendment No. 1 on Form 10-Q/A.

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CALGON CARBON CORPORATION FORM 10-Q/A QUARTER ENDED March 31, 2006

The Quarterly Report on Form 10-Q/A contains historical information and forward-looking statements.  Statements looking forward in time are included in this Form 10-Q/A pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.  They involve known and unknown risks and uncertainties that may cause the Companys actual results in the future to differ from performance suggested herein.  In the context of forward-looking information provided in this Form 10-Q/A and in other reports, please refer to the discussion of risk factors detailed in, as well as the other information contained in the Companys filings with the Securities and Exchange Commission.

I N D E X

|                                                        |          |    |                                                                                                               |  | Page
|------------------------------------------------------- | -------- | -- | ------------------------------------------------------------------------------------------------------------- |  | ----
|                                                        |          |    |                                                                                                               |  |     
|PART 1    CONDENSED CONSOLIDATED FINANCIAL INFORMATION |          |   
|                                                        |          |   
|                                                        | Item 1.  |    | Condensed   Consolidated Financial Statements                                                                 |  |     
|                                                        |          |    |                                                                                                               |  |     
|                                                        |          |    | Introduction   to the Condensed Consolidated Financial Statements                                             |  | 3   
|                                                        |          |    |                                                                                                               |  |     
|                                                        |          |    | Condensed   Consolidated Statements of Operations and Retained Earnings (unaudited)   (Restated, See Note 16) |  | 4   
|                                                        |          |    |                                                                                                               |  |     
|                                                        |          |    | Condensed   Consolidated Balance Sheets (unaudited) (Restated, See Note 16)                                   |  | 5   
|                                                        |          |    |                                                                                                               |  |     
|                                                        |          |    | Condensed   Consolidated Statements of Cash Flows (unaudited) (Restated, See Note 16)                         |  | 6   
|                                                        |          |    |                                                                                                               |  |     
|                                                        |          |    | Notes to   Condensed Consolidated Financial Statements (unaudited)                                            |  | 7   
|                                                        |          |    |                                                                                                               |  |     
|                                                        | Item 2.  |    | Managements   Discussion and Analysis of Results of Operations and Financial Condition                       |  | 21  
|                                                        |          |    |                                                                                                               |  |     
|                                                        | Item 4.  |    | Controls   and Procedures                                                                                     |  | 27  
|                                                        |          |    |                                                                                                               |  |     
|PART II   - OTHER INFORMATION                           |          |   
|                                                        |          |   
|                                                        | Item 1.  |    | Legal   Proceedings                                                                                           |  | 29  
|                                                        |          |    |                                                                                                               |  |     
|                                                        | Item 1a. |    | Risk   Factors                                                                                                |  | 29  
|                                                        |          |    |                                                                                                               |  |     
|                                                        | Item 2c. |    | Unregistered   Sales of Equity Securities and Use of Proceeds                                                 |  | 33  
|                                                        |          |    |                                                                                                               |  |     
|                                                        | Item 4.  |    | Submission of Matters to a Vote of Security Holders                                                           |  | 34  
|                                                        |          |    |                                                                                                               |  |     
|                                                        | Item 6.  |    | Exhibits                                                                                                      |  | 34  
|                                                        |          |    |                                                                                                               |  |     
|SIGNATURES                                              |          | 35
|                                                        |          |   
|CERTIFICATIONS                                          |          |   

2

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PART I  CONDENSED CONSOLIDATED FINANCIAL INFORMATION

Item 1.  Condensed Consolidated Financial Statements

INTRODUCTION TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The unaudited interim condensed consolidated financial statements included herein have been prepared by Calgon Carbon Corporation and subsidiaries (the Company), without audit, pursuant to the rules and regulations of the Securities and Exchange Commission.  Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations.  Management of the Company believes that the disclosures are adequate to make the information presented not misleading when read in conjunction with the Companys audited consolidated financial statements and the notes included therein for the year ended December 31, 2005, as filed with the Securities and Exchange Commission by the Company in Form 10-K.

In managements opinion, the unaudited interim condensed consolidated financial statements reflect all adjustments, which are of a normal and recurring nature, which are necessary for a fair presentation, in all material respects, of financial results for the interim periods presented.  Operating results for the first three months of 2006 are not necessarily indicative of the results that may be expected for the year ending December 31, 2006.

3

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CALGON CARBON CORPORATIONCONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND RETAINED EARNINGS(Dollars in Thousands Except Share and Per Share Data) (Unaudited)

|                                                                                                                         |  | Three   Months Ended   March 31, |           
|------------------------------------------------------------------------------------------------------------------------ |  | -------------------------------- | ----------
|                                                                                                                         |  |                                  |           
|                                                                                                                         |  | 2006                             |           
|                                                                                                                         |  |                                  |           
|                                                                                                                         |  | (As   Restated See Note 16)      |           
|Net sales                                                                                                                |  | $                                | 76,579    
|                                                                                                                         |  |                                  |           
|Cost of products sold   (excluding depreciation)                                                                         |  |                                  | 57,411    
|Depreciation and   amortization                                                                                          |  |                                  | 4,798     
|Selling, general and   administrative expenses                                                                           |  |                                  | 14,372    
|Research and development   expenses                                                                                      |  |                                  | 1,197     
|Gulf Coast Facility   impairment charge (Note 3)                                                                         |  |                                  |          
|Restructuring charge                                                                                                     |  |                                  | 6         
|                                                                                                                         |  |                                  |           
|                                                                                                                         |  |                                  | 77,784    
|                                                                                                                         |  |                                  |           
|Loss from operations                                                                                                     |  |                                  | (1,205    
|Interest income                                                                                                          |  |                                  | 86        
|Interest expense                                                                                                         |  |                                  | (1,574    
|Other expensenet                                                                                                        |  |                                  | (844      
|                                                                                                                         |  |                                  |           
|Loss from continuing   operations before income taxes, equity in income from equity investments, and   minority interest |  |                                  | (3,537    
|Income tax benefit                                                                                                       |  |                                  | (345      
|                                                                                                                         |  |                                  |           
|Loss from continuing   operations before equity in income from equity investments and minority   interest                |  |                                  | (3,192    
|Equity in income from equity   investments                                                                               |  |                                  | 188       
|Minority interest                                                                                                        |  |                                  | 15        
|                                                                                                                         |  |                                  |           
|Loss from continuing   operations                                                                                        |  |                                  | (2,989    
|Income from discontinued   operations  net of tax                                                                       |  |                                  | 1,575     
|                                                                                                                         |  |                                  |           
|Net loss                                                                                                                 |  |                                  | (1,414    
|Common stock dividends                                                                                                   |  |                                  |          
|Retained earnings,   beginning of period                                                                                 |  |                                  | 101,833   
|                                                                                                                         |  |                                  |           
|Retained earnings, end of   period                                                                                       |  | $                                | 100,419   
|                                                                                                                         |  |                                  |           
|Basic and diluted loss from   continuing operations per common share                                                     |  | $                                | (.08      
|Income from discontinued   operations per common share                                                                   |  | $                                | .04       
|                                                                                                                         |  |                                  |           
|Basic and diluted net loss   per common share                                                                            |  | $                                | (.04      
|                                                                                                                         |  |                                  |           
|Weighted average shares outstanding                                                                                      |  |                                  |           
|Basic and diluted                                                                                                        |  |                                  | 39,854,726
|                                                                                                                         |  |                                  |           

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

4

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CALGON CARBON CORPORATIONCONDENSED CONSOLIDATED BALANCE SHEETS(Dollars in Thousands except share data) (Unaudited)

|                                                                                                          |  | March 31,   2006             |         | December   31,   2005 |  
|--------------------------------------------------------------------------------------------------------- |  | ---------------------------- | ------- | --------------------- | -
|                                                                                                          |  |                              |         |                       |  
|                                                                                                          |  | (As   Restated, See Note 16) |         |                       |  
|ASSETS                                                                                                    |  |                              |         |                       |  
|Current assets:                                                                                           |  |                              |         |                       |  
|Cash   and cash equivalents                                                                               |  | $                            | 4,383   |                       | $
|Receivables   (net of allowance of $2,336 and $2,172)                                                     |  |                              | 55,223  |                       |  
|Revenue   recognized in excess of billings on uncompleted contracts                                       |  |                              | 5,515   |                       |  
|Inventories                                                                                               |  |                              | 69,461  |                       |  
|Deferred   income taxes  current                                                                         |  |                              | 10,199  |                       |  
|Other   current assets                                                                                    |  |                              | 5,747   |                       |  
|Assets   held for sale                                                                                    |  |                              | 4,123   |                       |  
|                                                                                                          |  |                              |         |                       |  
|Total   current assets                                                                                    |  |                              | 154,651 |                       |  
|Property,   plant and equipment, net                                                                      |  |                              | 107,964 |                       |  
|Equity   investments                                                                                      |  |                              | 7,507   |                       |  
|Intangibles                                                                                               |  |                              | 9,587   |                       |  
|Goodwill                                                                                                  |  |                              | 33,881  |                       |  
|Deferred   income taxes  long-term                                                                       |  |                              | 15,241  |                       |  
|Other   assets                                                                                            |  |                              | 3,756   |                       |  
|                                                                                                          |  |                              |         |                       |  
|Total   assets                                                                                            |  | $                            | 332,587 |                       | $
|                                                                                                          |  |                              |         |                       |  
|LIABILITIES   AND SHAREHOLDERS EQUITY                                                                    |  |                              |         |                       |  
|Current liabilities:                                                                                      |  |                              |         |                       |  
|Short-term   debt                                                                                         |  | $                            | 68,574  |                       | $
|Accounts   payable and accrued liabilities                                                                |  |                              | 38,093  |                       |  
|Billings   in excess of revenue recognized on uncompleted contracts                                       |  |                              | 3,000   |                       |  
|Payroll   and benefits payable                                                                            |  |                              | 11,153  |                       |  
|Accrued   income taxes                                                                                    |  |                              | 11,508  |                       |  
|Liabilities   held for sale                                                                               |  |                              | 3,101   |                       |  
|                                                                                                          |  |                              |         |                       |  
|Total   current liabilities                                                                               |  |                              | 135,429 |                       |  
|Long-term   debt                                                                                          |  |                              | 2,925   |                       |  
|Deferred   income taxes  long-term                                                                       |  |                              | 1,105   |                       |  
|Accrued   pension and other liabilities                                                                   |  |                              | 43,040  |                       |  
|                                                                                                          |  |                              |         |                       |  
|Total   liabilities                                                                                       |  |                              | 182,499 |                       |  
|                                                                                                          |  |                              |         |                       |  
|Commitments   and contingencies                                                                           |  |                              |         |                       |  
|Shareholders   equity:                                                                                   |  |                              |         |                       |  
|Common   shares, $.01 par value, 100,000,000 shares authorized, 42,499,696 and   42,459,733 shares issued |  |                              | 425     |                       |  
|Additional   paid-in capital                                                                              |  |                              | 70,061  |                       |  
|Retained   earnings                                                                                       |  |                              | 100,419 |                       |  
|Accumulated   other comprehensive income                                                                  |  |                              | 7,300   |                       |  
|Deferred   compensation                                                                                   |  |                              | (757    | )                     |  
|                                                                                                          |  |                              |         |                       |  
|                                                                                                          |  |                              | 177,448 |                       |  
|Treasury   stock, at cost, 2,819,690 and 2,787,258 shares                                                 |  |                              | (27,360 | )                     |  
|                                                                                                          |  |                              |         |                       |  
|Total   shareholders equity                                                                              |  |                              | 150,088 |                       |  
|                                                                                                          |  |                              |         |                       |  
|Total   liabilities and shareholders equity                                                              |  | $                            | 332,587 |                       | $
|                                                                                                          |  |                              |         |                       |  

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

5

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CALGON CARBON CORPORATIONCONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS(Dollars in Thousands) (Unaudited)

|                                                                                                          |  | Three   Months Ended   March 31, |        
|--------------------------------------------------------------------------------------------------------- |  | -------------------------------- | -------
|                                                                                                          |  |                                  |        
|                                                                                                          |  | 2006                             |        
|                                                                                                          |  |                                  |        
|                                                                                                          |  | (As   Restated, See Note 16)     |        
|Cash flows from operating   activities                                                                    |  |                                  |        
|Net loss                                                                                                  |  | $                                | (1,414 
|Adjustments to reconcile   net loss to net cash used in operating activities:                             |  |                                  |        
|Gain   from sale of assets, pre-tax                                                                       |  |                                  | (6,078 
|Depreciation   and amortization                                                                           |  |                                  | 4,800  
|Non-cash   impairment and restructuring charges                                                           |  |                                  |       
|Equity   in income from equity investments                                                                |  |                                  | (188   
|Distributions   received from equity investments                                                          |  |                                  |       
|Employee   benefit plan provisions                                                                        |  |                                  | 1,154  
|Changes   in assets and liabilities - net of effects from purchase of business and   non-cash impairment: |  |                                  |        
|Increase   in receivables                                                                                 |  |                                  | (1,803 
|Increase   in inventories                                                                                 |  |                                  | (2,683 
|Increase   in revenue in excess of billings on uncompleted contracts and other current   assets           |  |                                  | (1,036 
|Decrease   in accounts payable, accrued liabilities, and billings in excess of revenue                    |  |                                  | (503   
|Increase   (decrease) in long-term deferred income taxes                                                  |  |                                  | 1,270  
|Other   items  net                                                                                       |  |                                  | 2,044  
|                                                                                                          |  |                                  |        
|Net   cash used in operating activities                                                                   |  |                                  | (4,437 
|                                                                                                          |  |                                  |        
|Cash flows from investing   activities                                                                    |  |                                  |        
|Purchase of business - net   of cash                                                                      |  |                                  |       
|Proceeds from the sale of   assets                                                                        |  |                                  | 19,120 
|Property, plant and   equipment expenditures                                                              |  |                                  | (3,093 
|Proceeds from disposals of   property, plant and equipment                                                |  |                                  | 52     
|                                                                                                          |  |                                  |        
|Net   cash provided by (used in) investing activities                                                     |  |                                  | 16,079 
|                                                                                                          |  |                                  |        
|Cash flows from financing   activities                                                                    |  |                                  |        
|Proceeds   from borrowings                                                                                |  |                                  | 32,300 
|Repayments   of borrowings                                                                                |  |                                  | (44,726
|Common   stock dividends                                                                                  |  |                                  |       
|Common   stock issued through exercise of stock options                                                   |  |                                  | 335    
|                                                                                                          |  |                                  |        
|Net   cash (used in) provided by financing activities                                                     |  |                                  | (12,091
|                                                                                                          |  |                                  |        
|Effect of exchange rate   changes on cash                                                                 |  |                                  | (614   
|                                                                                                          |  |                                  |        
|Decrease in cash and cash   equivalents                                                                   |  |                                  | (1,063 
|Cash and cash equivalents,   beginning of period                                                          |  |                                  | 5,446  
|                                                                                                          |  |                                  |        
|Cash and cash equivalents,   end of period                                                                |  | $                                | 4,383  
|                                                                                                          |  |                                  |        

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

6

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CALGON CARBON CORPORATIONNOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Dollars in Thousands) (Unaudited)

|1. | Acquisition                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   | In May 2005, the Company   formed a joint venture company with C. Gigantic Carbon to provide carbon   reactivation services to the Thailand market.  The joint venture company was named Calgon Carbon (Thailand)   Ltd. and is 20% owned by the Company after an initial investment of $0.2   million.  It is accounted for in the   Companys financial statements under the equity method.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|2. | Discontinued Operations   and Assets and Liabilities Held for Sale                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   | The Companys financial   statements for all periods presented were significantly impacted by   activities relating to the planned divestiture of two of the Companys   businesses.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   | On February 4, 2005, the   Companys Board of Directors approved a re-engineering plan. In order to   allow the Company to focus on its core activated carbon and service related   businesses, the plan included the divestiture of two non-core   businesses.  In the fourth quarter of   2005, management concluded such divestitures are probable and the Company   reclassified the following businesses from continuing operations to   discontinued operations and assets held for sale for all periods presented:   Charcoal/Liquid in Bodenfelde, Germany and Solvent Recovery in Columbus,   Ohio; Vero Beach, Florida; and Ashton, United Kingdom.  The Charcoal/Liquid and Solvent Recovery   businesses were reported in the Companys Consumer and Equipment segments,   respectively.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   | On February 17, 2006,   Calgon Carbon Corporation, through its wholly owned subsidiary Chemviron   Carbon GmbH, executed an agreement (the Charcoal Sale Agreement) with   proFagus GmbH, proFagus Grundstuecksverwaltungs GmbH and proFagus   Beteiligungen GmbH (as Guarantor) to sell, and sold, substantially all the   assets, real estate, and specified liabilities of the Bodenfelde, Germany   facility (the Charcoal/Liquid business).    The facility includes the production of charcoal for consumer use and   liquids that are recovered during charcoal production.  The products are sold to retail and   industrial markets.  The aggregate sales   price, based on an exchange rate of 1.19 dollars per Euro, consisted of $19.1   million of cash and is subject to a potential working capital   adjustment.  The Company provided   guarantees to the buyer related to pre-divestiture tax liabilities, future   environmental remediation costs related to
pre-divestiture activities and   other contingencies.  Management   believes the ultimate cost of such guarantees is not material.  An additional $5.0 million could be paid   contingent upon the business meeting certain earnings targets over the next   three years.  As of March 31, 2006,   the Company recorded a pre-tax gain of $4.7 million or $1.7 million, net of   tax, on the sale of the Charcoal/Liquid divestiture.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   | On April 24, 2006, the   Company completed the sale of the assets of its Solvent Recovery business to   MEGTEC Systems, Inc., a subsidiary of Sequa Corporation.  The Solvent Recovery unit provides turnkey   on-site regenerable solvent recovery systems, distillation systems, on-site   regenerable volatile organic compound concentrators, vapor-phase biological oxidation   systems, and related services on a worldwide basis.  The purchase price of $1.9 million included cash proceeds of   approximately $0.8 million and $1.1 million of retained assets, primarily   accounts receivable.  The gain on the   sale is not expected to be significant and will be recorded in the second   quarter 2006.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

7

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| | The following table details selected
financial information for the businesses included within the discontinued
operations in the Condensed Consolidated Statements of Operations and Retained
Earnings
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                      |  | Charcoal/Liquid      Quarter Ended March 31 |       | Solvent   Recovery    Quarter Ended March 31 |  
|------------------------------------- |  | ------------------------------------------- | ----- | -------------------------------------------- | -
|                                      |  |                                             |       |                                              |  
|(Dollars in thousands)                |  |                                             | 2006  |                                              |  
|                                      |  |                                             |       |                                              |  
|Net sales                             |  | $                                           | 1,375 |                                              | $
|                                      |  |                                             |       |                                              |  
|Income (loss) from   operations       |  |                                             | (402  | )                                            |  
|Other income-net                      |  |                                             | 4,716 |                                              |  
|                                      |  |                                             |       |                                              |  
|Income before income taxes            |  |                                             | 4,314 |                                              |  
|Income tax  expense                   |  |                                             | 2,752 |                                              |  
|                                      |  |                                             |       |                                              |  
|Income from discontinued   operations |  | $                                           | 1,562 |                                              | $
|                                      |  |                                             |       |                                              |  

The major classes of assets and
liabilities of operations held for sale in the Condensed Consolidated Balance
Sheets are as follows:

|                                           |  | Charcoal/Liquid  |   | Solvent   Recovery  |  
|------------------------------------------ |  | ---------------- | - | ------------------- | -
|                                           |  |                  |   |                     |  
|(Dollars in thousands)                     |  | March 31,   2006 |   | December   31, 2005 |  
|                                           |  |                  |   |                     |  
|Assets:                                    |  |                  |   |                     |  
|Receivables                                |  | $                |  |                     | $
|Inventories                                |  |                  |  |                     |  
|Property,   plant and equipment, net       |  |                  |  |                     |  
|Goodwill                                   |  |                  |  |                     |  
|Other   assets                             |  |                  |  |                     |  
|                                           |  |                  |   |                     |  
|Total assets held for sale                 |  | $                |  |                     | $
|                                           |  |                  |   |                     |  
|Liabilities                                |  |                  |   |                     |  
|Accounts   payable and accrued liabilities |  |                  |  |                     |  
|Other   liabilities                        |  |                  |  |                     |  
|                                           |  |                  |   |                     |  
|Total liabilities held for   sale          |  | $                |  |                     | $
|                                           |  |                  |   |                     |  

|3. | Gulf Coast Facility   Impairment Charge                                                                                                                                                                                                                                                                                                                                                                                                                                              
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | In 2003, the Company   temporarily suspended construction of a new facility in the Gulf Coast region   of the United States as it evaluated strategic alternatives.  On March 22, 2005, the Company concluded,   and the Board of Directors approved, that cancellation of this project was   warranted and that construction of such a facility should be suspended for   the foreseeable future.  Accordingly,   the Company recorded an impairment charge of $2.2 million in 2005.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|4. | Inventories:                                                                                                                                                                                                                                                                                                                                                                                                                                                                         

|               |  | March 31,   2006 |        | December   31, 2005 |  
|-------------- |  | ---------------- | ------ | ------------------- | -
|               |  |                  |        |                     |  
|Raw materials  |  | $                | 18,050 |                     | $
|Finished goods |  |                  | 51,411 |                     |  
|               |  |                  |        |                     |  
|               |  | $                | 69,461 |                     | $
|               |  |                  |        |                     |  

8

---



|5. | Supplemental Cash Flow   Information:
|-- | -------------------------------------

|                                   |  | Three   Months Ended March 31, |       
|---------------------------------- |  | ------------------------------ | ------
|                                   |  |                                |       
|                                   |  | 2006                           |       
|                                   |  |                                |       
|Cash paid during the period   for: |  |                                |       
|Interest                           |  | $                              | (1,574
|                                   |  |                                |       
|Income   taxes paid  net          |  | $                              | (2    
|                                   |  |                                |       

|6. | Dividends:                                                                                                                                                                                                                 
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                            
|   | The Companys Board of   Directors did not declare or pay a dividend for the quarter ended March 31,   2006. Common stock dividends declared and paid during the quarter ended March   31, 2005 were $.03 per common share.
|   |                                                                                                                                                                                                                            
|7. | Comprehensive income   (loss):                                                                                                                                                                                             

|                                                  |  | Three   Months Ended March 31, |       
|------------------------------------------------- |  | ------------------------------ | ------
|                                                  |  |                                |       
|                                                  |  | 2006                           |       
|                                                  |  |                                |       
|Net loss                                          |  | $                              | (1,414
|Other   comprehensive income (loss), net of taxes |  |                                | 858   
|                                                  |  |                                |       
|Comprehensive income (loss)                       |  | $                              | (556  
|                                                  |  |                                |       

|   | The only matter   contributing to the other comprehensive income during the three months ended   March 31, 2006 was the foreign currency translation adjustment of $1.0   million and the change in the fair value of the derivative instruments of   ($0.1) million as described in Note 9.    The only matters contributing to the other comprehensive loss during   the three months ended March 31, 2005 were the foreign currency translation   adjustment of ($2.9) million and the change in the fair value of the   derivative instruments of ($0.1) million.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|8. | Segment Information:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   | The Activated Carbon and   Service segment manufactures granular activated carbon for use in   applications to remove organic compounds from liquids, gases, water, and   air.  This segment also consists of   services related to activated carbon including reactivation of spent carbon   and the leasing, monitoring, and maintenance of carbon fills at customer   sites.  The service portion of this   segment also includes services related to the Companys ion exchange   technologies for treatment of groundwater and process streams.  The Equipment segment provides solutions   to customers air and water process problems through the design, fabrication,   and operation of systems that utilize the Companys enabling   technologies:  carbon adsorption,   ultraviolet light, and advanced ion exchange separation.  The Consumer segment brings the Companys   purification technologies directly to the consumer in the form of products
 and services including carbon cloth and activated carbon for household odors.   The following segment information represents the results of the Companys   continuing operations.

9

---



|                                                                                                                                      |  | Three   Months Ended March 31, |       
|------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------------ | ------
|                                                                                                                                      |  |                                |       
|                                                                                                                                      |  | 2006                           |       
|                                                                                                                                      |  |                                |       
|Net Sales                                                                                                                             |  |                                |       
|Carbon   and Service                                                                                                                  |  | $                              | 65,185
|Equipment                                                                                                                             |  |                                | 8,441 
|Consumer                                                                                                                              |  |                                | 2,953 
|                                                                                                                                      |  |                                |       
|                                                                                                                                      |  | $                              | 76,579
|                                                                                                                                      |  |                                |       
|Income (loss) from   continuing operations before depreciation, amortization, impairment,   restructuring, and income taxes           |  |                                |       
|Carbon   and Service                                                                                                                  |  | $                              | 5,048 
|Equipment                                                                                                                             |  |                                | (1,659
|Consumer                                                                                                                              |  |                                | 210   
|                                                                                                                                      |  |                                |       
|                                                                                                                                      |  |                                | 3,599 
|Depreciation and   amortization                                                                                                       |  |                                |       
|Carbon   and Service                                                                                                                  |  |                                | 4,449 
|Equipment                                                                                                                             |  |                                | 210   
|Consumer                                                                                                                              |  |                                | 139   
|                                                                                                                                      |  |                                |       
|                                                                                                                                      |  |                                | 4,798 
|                                                                                                                                      |  |                                |       
|Loss from continuing operations before
impairment, restructuring, and income taxes                                                    |  | $                              | (1,199
|                                                                                                                                      |  |                                |       
|Reconciling items:                                                                                                                    |  |                                |       
|Gulf   Coast Facility impairment charge                                                                                               |  |                                |      
|Restructuring   charges                                                                                                               |  |                                | (6    
|Interest   income                                                                                                                     |  |                                | 86    
|Interest   expense                                                                                                                    |  |                                | (1,574
|Other   expense  net                                                                                                                 |  |                                | (844  
|                                                                                                                                      |  |                                |       
|Consolidated loss from   continuing operations before income taxes, equity in income from equity   investments, and minority interest |  | $                              | (3,537
|                                                                                                                                      |  |                                |       

|                                          |  | March 31,   2006 |         | December   31, 2005 |  
|----------------------------------------- |  | ---------------- | ------- | ------------------- | -
|                                          |  |                  |         |                     |  
|Total Assets                              |  |                  |         |                     |  
|Carbon   and Service                      |  | $                | 274,397 |                     | $
|Equipment                                 |  |                  | 40,926  |                     |  
|Consumer                                  |  |                  | 13,141  |                     |  
|                                          |  |                  |         |                     |  
|Total assets from   continuing operations |  | $                | 328,464 |                     | $
|Assets held for sale                      |  |                  | 4,123   |                     |  
|                                          |  |                  |         |                     |  
|Consolidated total assets                 |  | $                | 332,587 |                     | $
|                                          |  |                  |         |                     |  

10

---



|9.  | Derivative Instruments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    | The Company accounts for   its foreign exchange derivative instruments under Statement of Financial   Accounting Standards (SFAS) No. 133, Accounting for Derivative Instruments   and Hedging Activities, as amended.    This standard requires recognition of all derivatives as either assets   or liabilities at fair value and may result in additional volatility in both   current period earnings and other comprehensive income as a result of   recording recognized and unrecognized gains and losses from changes in the   fair value of derivative instruments.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    | The Company had sixteen   foreign currency forward exchange contracts outstanding at March 31, 2006 and   none of these contracts qualified for hedge accounting treatment.  The Company held fifty-seven foreign   currency forward exchange contracts at March 31, 2005 of which eighteen   qualified and were treated as foreign exchange cash flow hedges regarding   payment for inventory purchases.  The   change in the fair market value of the effective hedge portion of the foreign   currency forward exchange contracts of ($56) thousand for the period ended   March 31, 2005 was recorded in other comprehensive (income) loss (see Note   7).  It was released into operations   over 12 months based on the timing of the sales of the underlying inventory.  The release to operations was reflected in   cost of products sold.  During the   periods ended March 31, 2006 and 2005, the Company recorded an immaterial   gain in other income for the sixteen and
remaining thirty-nine foreign   currency forward exchange contracts that did not qualify for hedge accounting   treatment.                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    | On April 26, 2004, the   Company entered into a ten-year foreign currency swap agreement to fix the   foreign exchange rate on a $6.5 million intercompany loan between the Company   and its foreign subsidiary, Chemviron Carbon Ltd.  Since its inception, the foreign currency swap has been treated   as a foreign exchange cash flow hedge.    Accordingly, the change in the fair value of the effective hedge   portion of the foreign currency swap of ($0.1) million and ($0.1) million,   respectively, for the periods ended March 31, 2006 and 2005 was recorded in   other comprehensive income (loss).    The balance of the effective hedge portion of the foreign currency   swap recorded in other long-term liabilities was $0.3 million and $0.7   million, respectively, as of March 31, 2006 and 2005.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    | No component of the   derivatives gains or losses has been excluded from the assessment of hedge   effectiveness.  For the periods ended   March 31, 2006 and 2005, the net gain or loss recognized due to the amount of   hedge ineffectiveness was insignificant.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|10. | Contingencies                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    | In August 2005, the   Companys Pearl River plant was impacted by Hurricane Katrina.  The Company has both property and business   interruption insurance coverage for this plant.  Management is in the process of filing claims with its   insurance carrier to recover damages for both property and business   interruption related to this event.    In the first quarter of 2006, the Company had incurred $2.4 million   for damages which the Company deems recoverable from insurance of which $1.1   million was recorded as additions to property, plant and equipment.  The aforementioned amounts result in the   following totals to date; $1.0 million for costs which are not recoverable   from insurance and $9.2 million for damages which the Company believes are   recoverable from insurance of which $4.9 million is recorded as recoverable   for additions to property, plant and equipment.  During the three months ended March 31, 2006, the Company
received an advance of $2.0 million on its claim from its insurance carrier   for property damage.  In April 2006,   the Company received an additional advance of $1.0 million on its claim from   its insurance carrier for property damage bringing the total advances   received to date on the claim to $4.5 million.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    | On December 31, 1996, the   Company purchased the common stock of Advanced Separation Technologies   Incorporated (AST) from Progress Capital Holdings, Inc. and Potomac Capital   Investment Corporation.  On January   12, 1998, the Company filed a claim for unspecified damages in the United   States District Court in the Western District of Pennsylvania alleging among   other things that Progress Capital Holdings and Potomac Capital Investment   Corporation materially breached various AST financial and operational   representations and warranties included in the Stock Purchase Agreement.  Based upon information obtained since the   acquisition and corroborated in the course of pre-trial discovery, the   Company believes that it has a reasonable basis for this claim and intends to   vigorously pursue reimbursement for damages sustained.  Neither the Company nor its counsel can   predict with certainty the amount, if any, of recovery that will be
obtained   from the defendants in this matter.                                                                                                                                                                                                                                                                

11

---



| | The Company is also   currently a party in three cases involving alleged infringement of its U.S.   Patent No. 6,129,893 and U.S. Patent No. 6,565,803 B1 (U.S. Patents) or   Canadian Patent No. 2,331,525 (525 Patent) for the method of preventing   infection from cryptosporidium found in drinking water.  In the first case, Wedeco Ideal Horizons,   Inc. filed suit against the Company seeking a declaratory judgment that it   does not infringe the Companys U.S. Patents and alleging unfair competition   by the Company.  This matter is   currently pending in the United States District Court for the District of New   Jersey.  In the second case, the   Company filed suit against the Town of Ontario, New York, Trojan   Technologies, Inc. (Trojan) and Robert Wykle, et al. in the United States   District Court for the Western District of New York alleging that the   defendant is practicing the method claimed within the
U.S. Patents without a   license.  In the third case, the   Company has filed suit against the City of North Bay, Ontario, Canada (North   Bay) and Trojan in the Federal Court of Canada alleging infringement of the   525 Patent by North Bay and inducement of infringement by Trojan.  The trial for this case was conducted and   completed in April 2006.  A decision   is expected to be rendered sometime within the ensuing two quarters.  Neither the Company nor its counsel can   predict with any certainty the outcome of the three matters.                                                                                                                                                                                                                                                                                                                                  
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | The Company has received a   demand from the Pennsylvania Department of Environmental Protection (PADEP)   that the Company reimburse PADEP for response costs the agency alleges have   been taken at a site owned by a third party and located in Allegheny County,   Pennsylvania (Site).  The letter   also included an unspecified amount for interest and for any future costs   that might be incurred by PADEP at the Site. The Company understands that the   response costs are approximately $1.3 million.  Based on information provided by PADEP, the Site is   approximately 8 acres and was used from the 1950s until the 1960s as a   disposal site for coke or carbon sweepings and other industrial wastes.  The Company has been in discussions with   PADEP regarding the Companys position that it is not the entity that   disposed of materials containing the contaminants identified by PADEP at the   Site and that any materials that may have been
deposited by the Companys   predecessor did not contain actionable levels of hazardous substances   identified by PADEP.  PADEP has   advised the Company that it is prepared to settle the matter for payment of   $475,000.  The Company believes   PADEPs position is not meritorious, and the demand is unwarranted.  The Company intends to continue to   vigorously defend the matter.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | In September 2004, a   customer of one of the Companys distributors demanded payment by the Company   of approximately $340,000 as reimbursement for losses allegedly caused by   activated carbon produced by the Company and sold by the distributor.  The claimant contends that the activated   carbon contained contamination which adversely impacted its production   process.  The Company is in the   process of evaluating the claim, and at this time, cannot predict with any   certainty the outcome of this matter.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | The Company is involved in   various legal proceedings, lawsuits and claims, including employment, product   warranty and environmental matters of a nature considered normal to its   business.  It is the Companys policy   to accrue for amounts related to these legal matters if it is probable that a   liability has been incurred and an amount is reasonably estimable.  Management believes, after consulting with   counsel, that the ultimate liabilities, if any, resulting from such lawsuits   and claims will not materially affect the consolidated results of operations,   cash flows, or financial position of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | In conjunction with the February 2004 purchase of
substantially all of Waterlinks operating assets and the stock of
Waterlinks U.K. subsidiary, several environmental studies were performed
on the Columbus, Ohio property by environmental consulting firms which
identified and characterized areas of contamination.  In addition, these
firms identified alternative methods of remediating the property, identified
feasible alternatives and prepared cost evaluations of the various
alternatives.  The Company concluded from the information in the studies
that a loss at this property is probable and recorded the liability as a
component of noncurrent other liabilities in the Companys consolidated
balance sheet.  At December 31, 2005, the balance recorded was $5.3
million.  Liability estimates are based on an evaluation of, among other
factors, currently available facts, existing technology, presently enacted laws
and regulations, and the remediation experience of other companies.  During
the first four months of 2006, the Company undertook a process of evaluating
contractors and securing bids to perform the remediation work on the Columbus,
Ohio property.  As a result of the evaluation of the additional information
gathered during that process, the Company reduced its estimate of its liability
by $1.3 million to $4.0 million as of March 31, 2006. The reduction of the
liability was recorded as a reduction of selling, general and administrative
expenses on the Companys condensed consolidated statement of operations
and retained earnings for the three months ended March 31, 2006.  The
Company has not incurred any environmental remediation expense for the three
months ended March 31, 2006 and has incurred a total of $0.2 million of
environmental remediation expense to date.

12

---



|    | It is reasonably possible   that a change in the estimate of this obligation will occur as remediation   preparation and remediation activity commences over the upcoming months.  The ultimate remediation costs are   dependent upon among other things, the requirements of any state or federal   environmental agencies, the remediation methods employed, the final scope of   work being determined, and the extent and types of contamination which will   not be fully determined until experience is gained through remediation and   related activities.  The accrued   amounts are expected to be paid out over the course of several years once   work has commenced.  The Company has   yet to make a determination that it will proceed with remediation efforts in   2006.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | The Company owns a 49%   interest in a joint venture, Calgon Mitsubishi Chemical Corporation, which   was formed on October 1, 2002.  At   March 31, 2006, Calgon Mitsubishi Chemical Corporation had $9.1 million in   borrowings from an affiliate of the majority owner of the joint venture.   The Company has agreed with the joint   venture and the lender that, upon request by the lender, the Company will   execute a guarantee for up to 49% of such borrowings.  At March 31, 2006, the lender had not   requested, and the Company has not provided, such guarantee.                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|11. | Goodwill & Intangible   Assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | The Company   accounts for goodwill and intangible assets in accordance with Statement of   Financial Accounting Standard (SFAS) No. 142, Goodwill and Other   Intangible Assets.  This standard   requires that goodwill and intangible assets with indefinite useful lives not   be amortized but should be tested for impairment at least annually.  Management has elected to do the annual   impairment test on December 31 of each year.    As required by SFAS No. 142, management has allocated goodwill to the   Companys reporting units.  No such   impairment existed based on the Companys most recent test at December 31,   2005.                                                                                                                                    

13

---



| | The   following is the categorization of the Companys intangible assets as of   March 31, 2006 and December 31, 2005 respectively:
| | -----------------------------------------------------------------------------------------------------------------------------------

|                             |  |                                          |              |                           | March 31,   2006 |                    | December   31, 2005 |                           
|---------------------------- |  | ---------------------------------------- | ------------ | ------------------------- | ---------------- | ------------------ | ------------------- | --------------------------
|                             |  |                                          |              |                           |                  |                    |                     |                           
|                             |  | Weighted   Average   Amortization Period |              | Gross   Carrying   Amount |                  | Foreign   Exchange |                     | Accumulated   Amortization
|                             |  |                                          |              |                           |                  |                    |                     |                           
|Amortized Intangible Assets: |  |                                          |              |                           |                  |                    |                     |                           
|Patents                      |  |                                          | 15.4   Years |                           | $                | 1,369              |                     | $                         
|Customer   Relationships     |  |                                          | 17.0   Years |                           |                  | 9,323              |                     |                           
|Customer   Contracts         |  |                                          | 2.8   Years  |                           |                  | 664                |                     |                           
|License   Agreement          |  |                                          | 5.0   Years  |                           |                  | 500                |                     |                           
|Other                        |  |                                          | 7.9   Years  |                           |                  | 665                |                     |                           
|Unpatented   Technology      |  |                                          | 20.0   Years |                           |                  | 2,875              |                     |                           
|                             |  |                                          |              |                           |                  |                    |                     |                           
|Total                        |  |                                          | 15.8   Years |                           | $                | 15,396             |                     | $                         
|                             |  |                                          |              |                           |                  |                    |                     |                           

| | For the   three months ended March 31, 2006 and 2005, the Company recognized $0.5   million and $0.5 million, respectively, of amortization expense.  The Company estimates amortization expense   to be recognized during the next five years as follows:
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|For the year ending December 31: |  |   |       | 
|-------------------------------- |  | - | ----- | 
|2006                             |  | $ | 1,763 | 
|2007                             |  | $ | 1,530 | 
|2008                             |  | $ | 1,330 | 
|2009                             |  | $ | 1,057 | 
|2010                             |  | $ | 914   | 

| | The changes   in the carrying amounts of goodwill by segment for the three months ended   March 31, 2006 are as follows:
| | ------------------------------------------------------------------------------------------------------------------------

|                                |  | Carbon   &   Service   Segment |        | Equipment   Segment |   | Consumer   Segment |   | Total |   
|------------------------------- |  | ------------------------------ | ------ | ------------------- | - | ------------------ | - | ----- | --
|                                |  |                                |        |                     |   |                    |   |       |   
|Balance as of January 1,   2006 |  | $                              | 20,534 |                     | $ | 13,280             |   | $     | 60
|Foreign exchange                |  |                                | 39     |                     |   | (32                | ) |       |  
|                                |  |                                |        |                     |   |                    |   |       |   
|Balance as of March 31,   2006  |  | $                              | 20,573 |                     | $ | 13,248             |   | $     | 60
|                                |  |                                |        |                     |   |                    |   |       |   

|12. | Borrowing   Arrangements
|--- | ------------------------

| | On January 30, 2006, the Company amended
and restated its existing $125.0 million unsecured United States revolving
credit facility.  The amended $118.0 million facility consists of a $100.0
million revolving loan and an $18.0 million term loan.  Current commitments
from the lenders under the new agreement total $105.0 million with an additional
$13.0 million available from the existing or new lenders.  The amended and
restated facility is secured by a blanket security interest in favor of the
lenders and a pledge agreement in favor of the lenders with respect to the stock
of certain subsidiaries.  Borrowings under this facility were being charged
a weighted average interest rate of 7.39% at March 31, 2006.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | Included in   the credit facility is a letter of credit sub-facility that cannot exceed   $30.0 million.  The interest rate is   based upon Euro-based (LIBOR) rates with other interest rate options   available. The applicable Euro Dollar margin ranges from 1.25% to 2.50%, and   an unused commitment fee that ranges from 0.25% to 0.50% and is based upon   the Companys ratio of debt to earnings before interest, income tax,   depreciation and amortization (EBITDA).    The credit facilitys covenants impose financial restrictions on the   Company, including maintaining certain ratios of debt to EBITDA, EBITDA to   cash outlays (cash outlays as defined by the agreement include payments for   income tax, interest, debt principal, dividends, and capital expenses) and   operating assets to debt and minimum net worth.  In addition, the facility imposes gross spending restrictions   on capital expenditures, dividends, treasury share repurchases,
acquisitions   and investments in non-controlled subsidiaries.  The facility also contains mandatory prepayment provisions for   the term loan and proceeds in excess of pre-established amounts of certain   events as defined within the loan agreement.

14

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|    | On February   23, 2006, the Company, as required by the amended credit facility, repaid the   $18.0 million term loan with the proceeds from the sale of the Companys   Charcoal/Liquid business.  The   remaining $100.0 million revolving loan has $87.0 million of funding   commitments from the Companys lenders.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | In March   2006, the Company amended its U.S. credit facility to clarify elements of   certain covenants and to finalize an amount used for one of the add-back   provisions of the covenants that were required to be met as of December 31,   2005 as conditions to the closing of the facility.  The Company was in compliance with these covenants as of   December 31, 2005, as amended.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | As of March   31, 2006 the Company was not in compliance with the Fixed Charge covenant   ratio which is based upon the Companys ratio of trailing twelve months   EBITDA to the sum of the Companys trailing twelve months payments for   interest, taxes, dividends, and capital expenditures.  The Company is not immediately seeking a   waiver, but has reached agreement with its lenders to continue utilizing the   facility with the same rights and privileges as it had prior to the violation   while the lenders have reserved their rights to call the debt without further   notice at any time during the period of violation.  Should the lenders elect to exercise their rights and call the   debt, the Company would be unable to satisfy the obligation without securing   an alternative financing arrangement or arrangements.  During the second quarter, the Company   intends to work with its lenders to resolve this violation by trying to   obtain a
waiver and amendment to the facility or seek alternative financing   arrangements should a resolution with the existing lending group prove   unsuccessful.  The Company has   classified all borrowings under this facility as short term as of March 31,   2006.                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|13. | Stock   Compensation Plans                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | The Company   has two stock-based compensation plans which are more fully described in Note   12 of the Companys 2005 Annual Report on Form 10-K.  Prior to January 1, 2006, the Company   accounted for awards granted under those plans following the recognition and   measurement principles of Accounting Principles Board Option No. 25,   Accounting for Stock Issued to Employees, (APB No. 25) and related   interpretations.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | The Company   adopted SFAS No. 123(R), Share-based Payments, on January 1, 2006 using the   modified prospective application method.    Under this transition method, compensation cost recognized in the   quarter ended March 31, 2006 includes the applicable amounts of compensation   cost of all stock-based payments granted prior to, but not yet vested as of   January 1, 2006 (based on the grant-date fair value estimated in accordance   with the original provisions of SFAS No. 123 and previously presented in the   pro forma footnote disclosures).    Compensation cost in the future will also include stock-based payments   granted subsequent to January 1, 2006 (based on the grant-date fair value   estimated in accordance with the new provisions of SFAS No. 123(R)).  Results for prior periods have not been   restated.  Prior to the adoption of   SFAS No. 123(R), no compensation cost was reflected in net income for stock   options as all
options granted had an exercise price equal to the market   value of the underlying common stock on the date of grant.  In accordance with SFAS No. 123(R),   compensation expense for stock options is now recorded over the vesting   period using the fair value on the date of grant, as calculated by the   Company using the Black-Scholes model.    The nonvested restricted stock grant date fair value, which is the market   price of the underlying common stock, is expensed over the vesting period.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | Stock-based   compensation expense                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | The following table   summarizes the total compensation expense recognized for stock-based   compensation awards:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    

|(Dollars in thousands except per share data)       |  | Three   Months Ended March 31   2006 |     
|-------------------------------------------------- |  | ------------------------------------ | ----
|                                                   |  |                                      |     
|Stock-based compensation   expense recognized:     |  |                                      |     
|Selling,   general and administrative expenses     |  | $                                    | 165 
|                                                   |  |                                      |     
|Total                                              |  |                                      | 165 
|                                                   |  |                                      |     
|Tax   effect                                       |  |                                      | 65  
|                                                   |  |                                      |     
|Increase in net loss                               |  | $                                    | 100 
|Decrease in basic and   diluted earnings per share |  | $                                    | 0.00
|                                                   |  |                                      |     

15

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| | Prior period pro forma presentations                                                                                                                                                                                                                                                        
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                             
| | The   following pro forma information is provided for comparative purposes and   illustrates the pro forma effect on net income and earnings per share as if   the fair value recognition provision of SFAS No. 123 had been applied to   stock-based compensation prior to January 1, 2006:

|(Dollars in thousands except per share data)  |  | Three   Months Ended March 31   2005 |           
|--------------------------------------------- |  | ------------------------------------ | ----------
|                                              |  |                                      |           
|Net loss                                      |  |                                      |           
|As   reported                                 |  | $                                    | (3,409    
|Stock-based   compensation, net of tax effect |  |                                      | (127      
|                                              |  |                                      |           
|Pro   forma                                   |  | $                                    | (3,536    
|                                              |  |                                      |           
|Weighted average shares   outstanding         |  |                                      |           
|Basic   and Diluted                           |  |                                      | 39,200,362
|                                              |  |                                      |           
|Net loss per common share                     |  |                                      |           
|Basic   and Diluted                           |  |                                      |           
|As   reported                                 |  | $                                    | (.09      
|Pro   forma                                   |  | $                                    | (.09      
|                                              |  |                                      |           

| | The above   disclosures of the effect of stock-based compensation expense for the three   months ended March 31, 2006 and the pro forma effect as if SFAS No. 123 had   been applied to the three months ended March 31, 2005, are based on the fair   value of stock option awards estimated on the date of grant using the   Black-Scholes option valuation model with the assumptions listed below:
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                                                                              |  | Three   Months Ended March 31 |            
|--------------------------------------------------------------------------------------------- |  | ----------------------------- | -----------
|                                                                                              |  |                               |            
|                                                                                              |  | 2006                          |            
|                                                                                              |  |                               |            
|Average grant date exercise   price per share of unvested awards - options                    |  | $                             | 8.09       
|Average grant date exercise   price per share of unvested awards  nonvested restricted stock |  | $                             | 0.00       
|Dividend yield                                                                                |  |                               | .00-.71%   
|Expected volatility                                                                           |  |                               | 34-44%     
|Risk-free interest rates                                                                      |  |                               | 3.38%-4.79%
|Expected lives of options                                                                     |  |                               | 5 -6 years 
|Average grant date fair   value per share of unvested option awards                           |  | $                             | 3.20       
|Average grant date fair   value per share of nonvested restricted awards                      |  | $                             | 6.54       
|                                                                                              |  |                               |            

| | The Dividend   yield is based on the latest annualized dividend rate and the   current market price of the underlying common stock at the date of grant.              
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                       
| | Expected volatility   is based on the historical volatility of the Companys stock and the implied   volatility calculated from traded options on the Companys stock.
| |                                                                                                                                                                       
| | The Risk-free   interest rates are based on the U.S. Treasury strip rate for the   expected life of the option.                                                       
| |                                                                                                                                                                       
| | The Expected   lives of options are determined from primarily historical stock   option exercise data.                                                                
| |                                                                                                                                                                       
| | Stock option activity                                                                                                                                                 
| |                                                                                                                                                                       
| | The   following tables show a summary of the status and activity of stock options   for the three months ended March 31, 2006:                                        

16

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| | Employee Stock Option Plan:
| | ---------------------------

|                                   |  | Shares |           | Weighted-   Average   Exercise   Price |   | Weighted-   Average   Remaining   Contractual   Term   (in years) |  | Aggregate   Intrinsic   Value   (in thousands) |     
|---------------------------------- |  | ------ | --------- | -------------------------------------- | - | ----------------------------------------------------------------- |  | ---------------------------------------------- | ----
|                                   |  |        |           |                                        |   |                                                                   |  |                                                |     
|Outstanding at beginning of   year |  |        | 2,138,900 |                                        | $ | 6.67                                                              |  |                                                |     
|Granted                            |  |        | 88,700    |                                        |   | 7.96                                                              |  |                                                |     
|Exercised                          |  |        | (5,250    | )                                      |   | 5.07                                                              |  |                                                |     
|Canceled                           |  |        | (166,200  | )                                      |   | 6.81                                                              |  |                                                |     
|                                   |  |        |           |                                        |   |                                                                   |  |                                                |     
|Outstanding at March 31, 2006      |  |        | 2,056,150 |                                        | $ | 6.72                                                              |  |                                                | 6.30
|                                   |  |        |           |                                        |   |                                                                   |  |                                                |     
|Exercisable at March 31,   2006    |  |        | 1,914,150 |                                        | $ | 6.61                                                              |  |                                                | 6.06
|                                   |  |        |           |                                        |   |                                                                   |  |                                                |     

| | The   weighted-average grant-date fair value of stock options granted during the   three months ended March 31, 2006 was $2.64 per share or $0.2 million.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                          
| | Non-Employee Directors Stock Option Plan:                                                                                                               

|                                   |  | Shares |         | Weighted-   Average   Exercise   Price |   | Weighted-   Average   Remaining   Contractual   Term   (in years) |  | Aggregate   Intrinsic   Value   (in thousands) |     
|---------------------------------- |  | ------ | ------- | -------------------------------------- | - | ----------------------------------------------------------------- |  | ---------------------------------------------- | ----
|                                   |  |        |         |                                        |   |                                                                   |  |                                                |     
|Outstanding at beginning of   year |  |        | 450,737 |                                        | $ | 7.14                                                              |  |                                                |     
|Granted                            |  |        |        |                                        |   |                                                                  |  |                                                |     
|Exercised                          |  |        |        |                                        |   |                                                                  |  |                                                |     
|Canceled                           |  |        |        |                                        |   |                                                                  |  |                                                |     
|                                   |  |        |         |                                        |   |                                                                   |  |                                                |     
|Outstanding at March 31,   2006    |  |        | 450,737 |                                        | $ | 7.14                                                              |  |                                                | 6.27
|                                   |  |        |         |                                        |   |                                                                   |  |                                                |     
|Exercisable at March 31,   2006    |  |        | 445,225 |                                        | $ | 7.16                                                              |  |                                                | 6.10

| | During the   three months ended March 31, 2006, the total intrinsic value of stock options   exercised (i.e., the difference between the market price at exercise and the   price paid by the employee to exercise the option) was $11 thousand.  The total amount of cash received from the   exercise of options was $27 thousand, and the related net tax benefit   realized from the exercise of these options was immaterial.  The options exercised were from the   Employee Stock Option Plan.  The total   fair value of options vested during the three months ended March 31, 2006 was   $3.20 per share or $0.8 million.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | Nonvested Restricted stock activity                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | Nonvested   restricted stock granted to employees under the Companys Employee Stock   Option Plan is valued at the grant date fair value, which is the market price   of the underlying common stock, and vest over service periods that range from   one to three years.                                                                                                                                                                                                                                                                                                                                                         
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | The   following table shows a summary of the status and activity of nonvested   restricted stock grants for the three months ended March 31, 2006:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 

|                               |  | Shares |         | Weighted-   Average   Grant-Date   Fair-Value   (per share) |  
|------------------------------ |  | ------ | ------- | ----------------------------------------------------------- | -
|                               |  |        |         |                                                             |  
|Nonvested at January 1,   2006 |  |        | 240,800 |                                                             | $
|Granted                        |  |        | 188,100 |                                                             |  
|Vested                         |  |        | (49,903 | )                                                           |  
|Cancelled                      |  |        | (17,242 | )                                                           |  
|                               |  |        |         |                                                             |  
|Nonvested at March 31, 2006    |  |        | 361,755 |                                                             | $
|                               |  |        |         |                                                             |  

17

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|    | Compensation   expense related to nonvested restricted stock totaled $0.1 million for the   three month period ended March 31, 2006.    The related net tax benefit related to restricted awards was   immaterial for the three month period ended March 31, 2006.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                   
|    | As of March   31, 2006, there was $2.2 million of total future compensation cost related to   nonvested share-based compensation arrangements and the weighted-average   period over which this cost is expected to be recognized is approximately   three years. 
|    |                                                                                                                                                                                                                                                                   
|14. | Pensions                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                   
|    | U.S. Plans:                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                   
|    | For U.S.   plans, the following table provides the components of net periodic pension   costs of the plans for the periods ended March 31, 2006 and 2005:                                                                                                         

|                                     |  | Three   Months Ended March 31 |       
|------------------------------------ |  | ----------------------------- | ------
|                                     |  |                               |       
|Pension Benefits (in thousands)      |  | 2006                          |       
|                                     |  |                               |       
|Service cost                         |  | $                             | 647   
|Interest cost                        |  |                               | 1,252 
|Expected return on plan   assets     |  |                               | (1,063
|Amortization of prior   service cost |  |                               | 81    
|Net amortization                     |  |                               | 253   
|Curtailment                          |  |                               |      
|                                     |  |                               |       
|Net periodic pension cost            |  | $                             | 1,170 
|                                     |  |                               |       

| | The expected   long-term rate of return on plan assets is 8.25% in 2006.                                                                                                                                                                                                                
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                         
| | Employer   Contributions                                                                                                                                                                                                                                                                
| |                                                                                                                                                                                                                                                                                         
| | In its 2005   financial statements, the Company disclosed that it expected to contribute   $4.4 million to its U.S. pension plans in 2006.  As of March 31, 2006, no contributions have been made.  The Company expects to contribute the $4.4   million over the remainder of the year.
| |                                                                                                                                                                                                                                                                                         
| | European   Plans:                                                                                                                                                                                                                                                                       
| |                                                                                                                                                                                                                                                                                         
| | For European   plans, the following table provides the components of net periodic pension   costs of the plans for the periods ended March 31, 2006 and 2005:                                                                                                                           

|                                 |  | Three   Months Ended March 31 |     
|-------------------------------- |  | ----------------------------- | ----
|                                 |  |                               |     
|Pension Benefits (in thousands)  |  | 2006                          |     
|                                 |  |                               |     
|Service cost                     |  | $                             | 253 
|Interest cost                    |  |                               | 422 
|Expected return on plan   assets |  |                               | (272
|Transition amount   amortization |  |                               | 13  
|Net amortization                 |  |                               | 48  
|                                 |  |                               |     
|Net periodic pension cost        |  | $                             | 464 
|                                 |  |                               |     

18

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|    | The expected   long-term rate of return on plan assets ranges from 5.00% to 7.10% in 2006.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    | Employer   Contributions                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    | In its 2005   financial statements, the Company disclosed that it expected to contribute   $2.0 million to its European pension plans in 2006.  As of March 31, 2006, the Company contributed $0.4   million.  The Company expects to   contribute the remaining $1.6 million as well as an additional $0.1 million   over the remainder of the year.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    | Defined   Contribution Plans                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    | The Company   also sponsors a defined contribution pension plan for certain U.S. employees   that permits employee contributions of up to 50% of eligible compensation in   accordance with Internal Revenue Service guidance.  As of January 1, 2006, for all U.S. salaried employees that elected   to freeze their benefits under the Companys defined benefit plans, the   Company makes a fixed contribution of 2% of employee eligible compensation   and matches contributions made by each participant in an amount equal to 100%   of the employee contribution up to a maximum of 2% of employee   compensation.  In addition, each of   these employees is eligible for an additional Company contribution of up to   4% of employee compensation based upon annual Company performance at the   discretion of the Companys Board of Directors.  For all other U.S. salaried employees, the Company makes   matching contributions on behalf of each participant
in an amount equal to 25% of the employee contribution up to a maximum of 4% of
employee eligible compensation.  Employer matching contributions vest
immediately.  Total expenses related to this defined contribution plan were
$0.1 million and $0.1 million, respectively, for the periods ended March 31,
2006 and 2005, respectively.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|15. | New   Accounting Pronouncements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    | In November 2004, the Financial Accounting
Standards Board (FASB) issued SFAS No. 151, Inventory Costs
 an amendment of ARB No. 43, Chapter 4, which requires the
recognition of costs of idle facilities, excessive spoilage, double freight and
re-handling costs as a component of current-period expenses.  The
provisions of SFAS No. 151 are effective for inventory costs incurred during
fiscal years beginning after June 15, 2005.  The Company adopted SFAS No.
151 effective January 1, 2006 as required.  Such adoption had no material
impact on the accompanying financial statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    | In December 2004, the FASB issued SFAS
No. 123R, Share-Based Payment, which establishes the accounting for
transactions in which an entity exchanges its equity instruments or certain
liabilities based upon an entitys equity instruments for goods or
services. SFAS No. 123R generally requires that publicly traded companies
measure the cost of employee services received in exchange for an award of
equity instruments based on the fair value of the award at the grant date. That
cost will be recognized over the period during which an employee is required to
provide service in exchange for the award which is usually the vesting period.
Management adopted SFAS No. 123R beginning January 1, 2006 as required and the
related costs are reflected in the accompanying financial statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    | In May 2005, the FASB   issued SFAS No. 154, Accounting Changes and Error Corrections, which   changes the requirements for the accounting for and reporting of a change in   accounting principle.  SFAS No. 154   applies to all voluntary changes in accounting principle.  It also applies to changes required by an   accounting pronouncement in the unusual instance that the pronouncement does   not include specific transition provisions.    When a pronouncement includes specific transition provisions, those   provisions should be followed.  The   Company adopted SFAS No. 154 effective January 1, 2006 as required.  Such adoption had no material impact on   the accompanying financial statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|16. | Restatement                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    | Subsequent to the issuance   of the Companys Condensed Consolidated Financial Statements for the three   months ended March 31, 2006, the Company identified an error which resulted   in an understatement of the Companys income taxes related to discontinued   operations as well as an overstatement of the Companys income taxes that   related to continuing operations for the three months ended March 31,   2006.  The error was made in the   calculation of the Companys tax provision for the quarter ended March 31,   2006.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    | As a result, the accompanying   Condensed Consolidated Financial Statements for the three month period ended   March 31, 2006 have been restated from the amounts previously reported.  The effect of the restatement for the   three month period ended March 31, 2006 is to increase the benefit for income   taxes and decrease loss from continuing operations by $29 thousand,   respectively; reduce income from discontinued operations  net of tax by $1.4   million, and increase net loss by $1.4 million.  Income from discontinued operations per common share decreased   by $0.04 and basic and diluted net loss per common share decreased by $0.04.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    | A summary of the   significant effects of the restatement is as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

19

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|                                       |  | Three   Months Ended   March 31, 2006           |       
|-------------------------------------- |  | ----------------------------------------------- | ------
|                                       |  |                                                 |       
|                                       |  | As   Previously   Reported                      |       
|                                       |  |                                                 |       
|                                       |  | (Dollars   in Thousands, Except Per Share Data) |       
|                                       |  | (Unaudited)                                     |       
|Statement of Operations:               |  |                                                 |       
|Benefit for income taxes               |  | $                                               | 316   
|Net loss from continuing   operations  |  |                                                 | (3,018
|Income from discontinued   operations  |  |                                                 | 3,016 
|Net loss                               |  |                                                 | (2    
|Net income (loss) per   common share   |  |                                                 |       
|Basic   and Diluted:                   |  |                                                 |       
|Loss   from continuing operations      |  |                                                 | (.08  
|Income   from discontinued operations. |  |                                                 | .08   
|Net   income (loss)                    |  |                                                 | .00   

|                                         |  | As of   March 31, 2006     |        
|---------------------------------------- |  | -------------------------- | -------
|                                         |  |                            |        
|                                         |  | As   Previously   Reported |        
|                                         |  |                            |        
|                                         |  | (Dollars   in Thousands)   |        
|                                         |  | (Unaudited)                |        
|Balance Sheet:                           |  |                            |        
|Deferred income tax asset    current    |  | $                          | 9,877  
|Total current assets                     |  |                            | 154,329
|Deferred income tax asset    long-term  |  |                            | 16,449 
|Total assets                             |  |                            | 333,473
|Accrued income taxes                     |  |                            | 11,165 
|Total current liabilities                |  |                            | 135,086
|Total liabilities                        |  |                            | 182,156
|Retained earnings                        |  |                            | 101,831
|Accumulated other   comprehensive income |  |                            | 7,117  
|Total shareholders equity               |  |                            | 151,317

|                                                                                              |  | As of   March 31, 2006   |                           
|--------------------------------------------------------------------------------------------- |  | ------------------------ | --------------------------
|                                                                                              |  |                          |                           
|                                                                                              |  |                          | As   Previously   Reported
|                                                                                              |  |                          |                           
|                                                                                              |  | (Dollars   in Thousands) |                           
|                                                                                              |  | (Unaudited)              |                           
|Statement of Cash Flows:                                                                      |  |                          |                           
|Net loss                                                                                      |  | $                        | (2                        
|Increase in revenue in   excess of billings on uncompleted Contracts and other current assets |  |                          | (713                      
|Decrease in accounts   payable, accrued liabilities, and billings in excess of revenue        |  |                          | (838                      
|Increase in long-term   deferred income taxes                                                 |  |                          | 1,422                     
|Other items - net                                                                             |  |                          | 492                       

20

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

This discussion should be read in connection with the information contained in the Unaudited Condensed Consolidated Financial Statements and Notes to the Unaudited Condensed Financial Statements and gives effect to the restatement discussed in Note 16 to the Unaudited Condensed Consolidated Financial Statements.

Results of Operations

Continuing Operations:

Consolidated net sales increased by $3.5 million or 4.8% for the quarter ended March 31, 2006 versus the quarter ended March 31, 2005.  Net sales for the quarter ended March 31, 2006 for the Carbon and Service segment increased $5.9 million or 9.9% versus the similar 2005 period.  The increase was primarily due to stronger sales in all geographical regions including increased sales of activated carbon in Japan to the Companys joint venture company, Calgon Mitsubishi Chemical Corporation as well as price increases.  Partially offsetting this increase was the negative impact of foreign currency translation of $1.6 million.  Net sales for the Equipment segment decreased $1.8 million or 17.2% in the first quarter 2006 versus the comparable 2005 period.  The decrease was primarily due to non-repeat sales of equipment for perchlorate removal from ground water and odor removal equipment. The impact of foreign currency translation for the
quarter ended March 31, 2006 was comparable to the similar 2005 period.  Net sales for the quarter ended March 31, 2006 for the Consumer segment decreased by $0.6 million or 16.5% versus the quarter ended March 31, 2005.  The decrease was attributable to lower demand for activated carbon cloth as well as the negative impact of foreign currency translation of $0.1 million.  The total negative impact of foreign currency translation on consolidated net sales for the quarter ended March 31, 2006 was $1.8 million.

Net sales less cost of products sold (excluding depreciation), as a percentage of net sales was 25.0% for the quarter ended March 31, 2006 compared to 27.7% for the similar 2005 period, a 2.7 percentage point decrease.  The decline was primarily due to higher raw material, energy, and transportation costs of $3.1 million or 4.0%.  These costs were partially offset by price increases of carbon products and services.

The depreciation and amortization decrease of $0.7 million during the quarter ended March 31, 2006 versus the quarter ended March 31, 2005 was primarily due to decreased depreciation due to an increase in fully depreciated fixed assets.

Selling, general and administrative expenses for the quarter ended March 31, 2006 decreased versus the comparable 2005 quarter by $1.5 million.  Included in the decrease was a change in the estimate of the Companys environmental liabilities assumed in the Waterlink acquisition of approximately $1.3 million.  Litigation expense increased $0.9 million versus the similar 2005 period.  Offsetting this increase was the non-recurring severance charges of $1.3 million related to the Companys 2005 re-engineering plan that occurred during the quarter ended March 31, 2005.

21

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Research and development expenses for the quarter ended March 31, 2006 were comparable to the similar 2005 period.

The impairment charge of $2.2 million for the quarter ended March 31, 2005 was as a result of the Companys decision on March 22, 2005 to cancel the construction of a reactivation facility on the U.S. Gulf Coast and to suspend the construction of such facility for the foreseeable future.

Restructuring charges for the quarter ended March 31, 2006 decreased $0.2 million versus the comparable 2005 period.  The restructuring charges for the quarter ended March 31, 2005 primarily related to pension curtailment charges as a result of employee separations from the Companys 2005 re-engineering plan.

Other expense for the quarter ended March 31, 2006 increased $0.4 million as compared to March 31, 2005.  The increase is primarily due to the write-off of deferred financing fees associated with the Companys previous credit facility.

Interest expense, net of interest income, for the quarter ended March 31, 2006 increased versus the quarter ended March 31, 2005 by $0.6 million.  The increase is the result of higher interest rates paid on the Companys borrowings both as a result of the increase in LIBOR rates from last years first quarter to this years first quarter and the Company paying higher interest spreads on its borrowings as a result of a lower trailing twelve months EBITDA as of the end of the first quarter 2006 versus the end of the first quarter 2005.

The effective tax rate for the quarter ended March 31, 2006 was 9.8% compared to 21.4% for the quarter ended March 31, 2005.  The quarter ended March 31, 2006 tax rate was lower than the statutory Federal Income Tax Rate due to certain benefits, principally the exclusion provided under United States income tax laws with respect to the Extraterritorial Income Exclusion Benefit and recognition of state income tax benefits.  The quarter ended March 31, 2005 tax rate was lower than the statutory Federal Income Tax Rate due to the Extraterritorial Income Exclusion Benefit, recognition of foreign tax credit benefits, and recognition of state income tax benefits. The primary item that contributed to the change in the effective tax rate between the three month period ended March 31, 2006 and the similar period for 2005 was the reduction in estimate of the Companys full year 2006 pre-tax earnings and its impact on the tax effect of the aforementioned
permanent items.

During the preparation of its effective tax rate, the Company uses an annualized estimate of pre-tax earnings.  Throughout the year this annualized estimate may change based on actual results and annual earnings estimate revisions.  Because the Companys permanent tax benefits are relatively constant, changes in the annualized estimate may have a significant impact on the effective tax rate in future periods.

The Company provides an estimate for income taxes based on an evaluation of the underlying accounts, its tax filing positions and interpretations of existing law.  Changes in estimates are reflected in the year of settlement or expiration of the statute of limitations.  The Company does not believe that resolution of existing unresolved tax matters will have a material impact on the consolidated financial condition of the Company, although a resolution could have a material impact on the Companys consolidated statement of income and comprehensive income for a particular future period and on the Companys effective tax rate.

Equity in income from equity investments for the quarter ended March 31, 2006 was comparable to the similar 2005 period.

Discontinued Operations:

Income from discontinued operations increased $0.6 million for the quarter ended March 31, 2006 versus March 31, 2005 primarily due the $1.7 million, net of tax, gain recognized on the sale of the Companys Charcoal/Liquid business.  Partially offsetting this increase was lower sales and profitability of the solvent recovery business in 2006 as a result of the completion of a significant project during 2005.

22

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Financial Condition

Working Capital and Liquidity

The cash flows discussed for the quarter ended March 31, 2006 and 2005 include discontinued operations.  Cash flows used in operating activities were $4.6 million for the period ended March 31, 2006 compared to cash flows used in operating activities of $2.4 million for the comparable 2005 period.  The $2.2 million increase in cash used represents an increase in operating working capital (exclusive of debt) in 2006 versus the comparable 2005 period.  The divestitures are expected to decrease earnings before income tax, depreciation and amortization (EBITDA) by approximately $3.0 million on an annual, on-going basis.

Common stock dividends were not paid during the quarter ended March 31, 2006 as compared to dividends that were paid during the quarter ended March 31, 2005 which represented $.03 per common share.

Total debt at March 31, 2006 was $71.5 million, a decrease of $12.4 million from December 31, 2005.  The decrease was as a result of the repayment of the Companys $18.0 million term loan and the additional borrowings of $5.6 million were used in financing normal working capital and capital expenditure activities.

On January 30, 2006, the Company amended and restated its existing $125.0 million unsecured United States revolving credit facility.  The amended $118.0 million facility consists of a $100.0 million revolving loan and an $18.0 million term loan.  Current commitments from the lenders under the new agreement total $105.0 million with an additional $13.0 million available to the existing or new lenders.  The amended and restated facility is secured by a blanket security interest in favor of the lenders and a pledge agreement in favor of the lenders with respect to the stock of certain subsidiaries.  Borrowings under this facility were being charged a weighted average interest rate of 7.39% at March 31, 2006.

Included in the credit facility is a letter of credit sub-facility that cannot exceed $30.0 million.  The interest rate is based upon Euro based (LIBOR) rates with other interest rate options available. The applicable Euro Dollar margin ranges from 1.25% to 2.50%, and an unused commitment fee that ranges from 0.25% to 0.50% and is based upon the Companys ratio of debt to earnings before interest, income tax, depreciation and amortization (EBITDA).  The credit facilitys covenants impose financial restrictions on the Company, including maintaining certain ratios of debt to EBITDA, EBITDA to cash outlays and operating assets to debt and minimum net worth.  In addition, the facility imposes gross spending restrictions on capital expenditures, dividends, treasury share repurchases, acquisitions and investments in non-controlled subsidiaries.  The facility also contains mandatory prepayment provisions for the term loan and proceeds in
excess of pre-established amounts of certain events as defined within the loan agreement.

On February 23, 2006, the Company, as required by the amended credit facility, repaid the $18.0 million term loan with the proceeds from the sale of the Companys Charcoal/Liquid business.  The remaining $100.0 million revolving loan has $87.0 million of funding commitments from the Companys lenders.

In March 2006, the Company amended its U.S. credit facility to clarify elements of certain covenants and to finalize an amount used for one of the add-back provisions of the covenants that were required to be met as of December 31, 2005 as conditions to the closing of the facility.  The Company was in compliance with these covenants as of December 31, 2005, as amended.

As of March 31, 2006 the Company was not in compliance with the Fixed Charge covenant ratio which is based upon the Companys ratio of trailing twelve months EBITDA to the sum of the Companys trailing twelve months payments for interest, taxes, dividends, and capital expenditures.  The Company is not immediately seeking a waiver, but has reached agreement with its lenders to continue utilizing the facility with the same rights and privileges as it had prior to the violation while the lenders have reserved their rights to call the debt without further notice at any time during the period of violation.  Should the lenders elect to exercise their rights and call the debt, the Company would be unable to satisfy the obligation without securing an alternative financing arrangement or arrangements.  During the second quarter, the Company intends to work with its lenders to resolve this violation by trying to obtain a waiver and amendment to the
facility or seek alternative financing arrangements should a resolution with the existing lending group prove unsuccessful.  The Company has classified all borrowings under this facility as short term as of March 31, 2006.

23

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The Company expects that current cash from operating activities plus cash balances and current access to available external financing (see conditions to access discussed above) will be sufficient to meet its operating requirements for the next twelve months and the foreseeable future.

The Company is obligated to make future payments under various contracts such as debt agreements, lease agreements, and unconditional purchase obligations.  As of March 31, 2006, with the exception of the debt covenant violation noted above, there have been no changes in the payment terms of long-term debt, lease agreements, and unconditional purchase obligations since December 31, 2005.  The following table represents the significant cash contractual obligations and other commercial commitments.

|                                      |  | Due in |         |      |   |       
|------------------------------------- |  | ------ | ------- | ---- | - | ------
|                                      |  |        |         |      |   |       
|(Thousands)                           |  | 2006   |         | 2007 |   | 2008  
|                                      |  |        |         |      |   |       
|Short-term debt                       |  | $      | 68,574  |      | $ |      
|Operating leases                      |  |        | 5,019   |      |   | 3,781 
|Unconditional purchase   obligations* |  |        | 26,755  |      |   | 21,626
|                                      |  |        |         |      |   |       
|Total contractual cash   Obligations  |  | $      | 100,348 |      | $ | 25,407
|                                      |  |        |         |      |   |       

|                                                                                                   
|---------------------------------------------------------------------------------------------------
|*Primarily   for the purchase of raw materials, transportation, and information systems   services.

Capital Expenditures and Investments

Capital expenditures for property, plant and equipment totaled $3.1 million for the three months ended March 31, 2006 compared to expenditures of $1.7 million for the same period in 2005.  The expenditures for the period ended March 31, 2006 consisted primarily of improvements to the Companys manufacturing facilities of $1.8 million, $1.1 million related to the repair of the Companys Pearl River plant as a result of Hurricane Katrina, and customer capital of $0.3 million.  The comparable 2005 expenditures consisted primarily of $1.4 million for improvements to manufacturing facilities and $0.1 million for customer capital.  Capital expenditures for 2006 are projected to be approximately $16.0 million.

The March 31, 2005 purchase of business cash out flow of $0.5 million, as shown on the statement of cash flows, represents the Companys increased equity ownership in Datong Carbon Corporation from 80% to 100% for a purchase price of $0.7 million.

In 2003, the Company temporarily suspended construction of a new facility in the Gulf Coast region of the United States as it evaluated strategic alternatives.  On March 22, 2005, the Company concluded, and the Board of Directors approved, that cancellation of this project was warranted and that construction of such a facility should be suspended for the foreseeable future.  Accordingly, the Company recorded an impairment charge of $2.2 million for the period ended March 31, 2005.

In January 2006, the Company announced the temporary idling of its reactivation facility in Blue Lake, California in an effort to reduce operating costs and to more efficiently utilize the capacity at its other existing locations.  The Company conducted an impairment review of the plants assets having a net book value of $1.7 million in connection with the temporary idling of the facility and concluded that the assets were not impaired.  It is managements intention to resume operation of the plant in 2007.  If management should conclude that the idling of the plant beyond 2007 is warranted, operating results may be adversely affected by impairment charges.

Regulatory Matters

Each of the Companys domestic production facilities has permits and licenses regulating air emissions and water discharges.  All of the Companys domestic production facilities are controlled under permits issued by local, state and federal air pollution control entities.  The Company is presently in compliance with these permits. Continued compliance will require administrative control and will be subject to any new or additional standards.  In May 2003, the Company partially discontinued operation of one of its three activated carbon lines at its Catlettsburg, Kentucky facility.  The Company will need to install pollution abatement equipment estimated at approximately $7.0 million in order to remain in compliance with state requirements regulating air emissions before resuming full operation of this line.  Management has not determined its plan of action for compliance related to this activated carbon line; however, if it is
determined that a shutdown of the full operation of the activated carbon line is warranted, the impact to current operating results would be insignificant.

24

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New Accounting Pronouncements

In November 2004, the FASB issued SFAS No. 151, Inventory Costs  an amendment of ARB No. 43, Chapter 4, which requires the recognition of costs of idle facilities, excessive spoilage, double freight and re-handling costs as a component of current-period expenses.  The provisions of SFAS No. 151 are effective for inventory costs incurred during fiscal years beginning after June 15, 2005.  The Company adopted SFAS No. 151 effective January 1, 2006 as required.  Such adoption had no material impact on the accompanying financial statements.

In December 2004, the FASB issued SFAS No. 123R, Share-Based Payment, which establishes the accounting for transactions in which an entity exchanges its equity instruments or certain liabilities based upon an entitys equity instruments for goods or services.  SFAS No. 123R generally requires that publicly traded companies measure the cost of employee services received in exchange for an award of equity instruments based on the fair value of the award at the grant date.  That cost will be recognized over the period during which an employee is required to provide service in exchange for the award which is usually the vesting period.  Management adopted SFAS No. 123R beginning January 1, 2006 as required and the related costs are reflected in the accompanying financial statements as discussed in Note 13.

In May 2005, the FASB issued SFAS No. 154, Accounting Changes and Error Corrections, which changes the requirements for the accounting for and reporting of a change in accounting principle.  SFAS No. 154 applies to all voluntary changes in accounting principle.  It also applies to changes required by an accounting pronouncement in the unusual instance that the pronouncement does not include specific transition provisions.  When a pronouncement includes specific transition provisions, those provisions should be followed.  The Company adopted SFAS No. 154 effective January 1, 2006 as required.  Such adoption had no material impact on the accompanying financial statements.

Critical Accounting Policies

Management of the Company has evaluated the accounting policies used in the preparation of the financial statements and related footnotes and believes the policies to be reasonable and appropriate.  The preparation of the financial statements in accordance with accounting principles generally accepted in the United States requires management to make judgments, estimates, and assumptions regarding uncertainties that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and the reported amounts of revenues and expenses.  Management uses historical experience and all available information to make these judgments and estimates, and actual results will inevitably differ from those estimates and assumptions that are used to prepare the Companys financial statements at any given time.  Despite these inherent limitations, management believes that Managements Discussion and Analysis (MD&A) and



the financial statements and related footnotes provide a meaningful and fair perspective of the Companys financial condition and results of operations.

The following are the critical accounting policies impacted by managements judgments, assumptions, and estimates. Management believes that the application of these policies on a consistent basis enables the Company to provide the users of the financial statements with useful and reliable information about the Companys operating results and financial condition.

Revenue Recognition

The Company recognizes revenue and related costs when goods are shipped or services are rendered to customers provided that ownership and risk of loss have passed to the customer. Revenue for major equipment projects is recognized under the percentage of completion method by comparing actual costs incurred to total estimated costs to complete the respective projects.

25

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Allowance for Doubtful Accounts

The Company maintains allowances for doubtful accounts for estimated losses resulting from the inability of its customers to make required payments.  The amount of allowance recorded is based upon a quarterly review of specific customer transactions that remain outstanding at least three months beyond their respective due dates.  If the financial condition of the Companys customers were to deteriorate resulting in an impairment of their ability to make payments, additional allowances may be required.

Inventories

The Companys inventories are carried at the lower of cost or market and adjusted to net realizable value by recording a reserve for inventory obsolescence.  The inventory obsolescence reserve is adjusted quarterly based upon a review of specific products that have remained unsold for a prescribed period of time.  If the market demand for various products softens, an additional reserve may be required.

Goodwill and Other Intangible Assets

The Company tests goodwill for impairment at least annually by initially comparing the fair value of the Companys reporting units to their related carrying values.  If the fair value of a reporting unit were less than its carrying value, additional steps would be necessary to determine the amount, if any, of goodwill impairment.  Fair values are estimated using discounted cash flow and other valuation methodologies that are based on projections of the amounts and timing of future revenues and cash flows.

Environmental Costs

Liabilities for environmental costs are recorded when it is probable that obligations have been incurred and the amounts can be reasonably estimated.  These liabilities are not reduced by possible recoveries from third parties, and projected cash expenditures are not discounted.

Pensions

Accounting for pensions involves estimating the cost of benefits to be provided well into the future and attributing that cost over the time period each employee works.  To accomplish this, extensive use is made of assumptions about inflation, investment returns, mortality, turnover and discount rates.  These assumptions are reviewed annually.  In determining the expected return on plan asset assumption, the Company evaluates long-term actual return information, the mix of investments that comprise plan assets and future estimates of long-term investment returns.

Income Taxes

During the ordinary course of business, there are many transactions and calculations for which the ultimate tax determination is uncertain.  Significant judgment is required in determining the Companys annual tax rate and in evaluating tax positions.  The Company establishes reserves when, despite managements belief that the Companys tax return positions are fully supportable, it believes that certain positions are probable to be challenged upon review by tax authorities.  Changes in estimates are reflected in the year of settlement or expiration of the statute of limitations.  While it is often difficult to predict the final outcome or the timing of resolution of any particular tax matter, the Company believes that its reserves reflect the probable outcome of known tax contingencies.  The resolution of tax matters will not have a material impact on the consolidated financial condition of the Company, although a
resolution could have a material impact on the Companys consolidated statements of operations and comprehensive income for a particular future period and on the Companys effective tax rate.

The Company is subject to varying statutory tax rates in the countries where it conducts business.  Fluctuations in the mix of the Companys income between countries result in changes to the Companys overall effective tax rate.

Litigation

The Company is involved in various asserted and unasserted legal claims.  An estimate is made to accrue for a loss contingency relating to any of these legal claims if it is probable that a liability was incurred at the date of the financial statements and the amount of loss can be reasonably estimated.  Because of the subjective nature inherent in assessing the outcome of legal claims and because the potential that an adverse outcome in a legal claim could have material impact on the Companys legal position or results of operations, such estimates are considered to be critical accounting estimates.  After review, it was determined at March 31, 2006, that for each of the various unresolved legal claims in which the Company is involved, the conditions mentioned above were not met.  As such, no accrual was recorded.  The Company will continue to evaluate all legal matters as additional information becomes available.

26

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Long-Lived Assets

The Company evaluates long-lived assets under the provisions of Statement of
Financial Accounting Standards (SFAS) No. 144, Accounting for the
Impairment or Disposal of Long-Lived Assets, which addresses financial
accounting and reporting for the impairment of long-lived assets, and for
long-lived assets to be disposed of.  For assets to be held and used, the
Company groups a long-lived asset or assets with other assets and liabilities at
the lowest level for which identifiable cash flows are largely independent of
the cash flows of other assets and liabilities.  An impairment loss for an
asset group reduces only the carrying amounts of a long-lived asset or assets of
the group being evaluated.  The loss is allocated to the long-lived assets
of the group on a pro-rata basis using the relative carrying amounts of those
assets, except that the loss allocated to an individual long-lived asset of the
group does not reduce the carrying amount of that asset below its fair value whenever that fair value is determinable without undue cost and effort.  Estimates of future cash flows used to test the recoverability of a long-lived asset group include only the future cash flows that are associated with and that are expected to arise as a direct result of the use and eventual disposition of the asset group.  The future cash flow estimates used by the Company exclude interest charges.

Item 4.  Controls and Procedures

Disclosure Controls and Procedures:

The Companys principal executive officer and principal financial officer have evaluated the effectiveness of the Companys disclosure controls and procedures, as such term is defined in Rule 13a-15(e) of the Securities Exchange Act of 1934, as amended (the Exchange Act), at the end of the period covered by its originally filed Quarterly Report on Form 10-Q (the Evaluation Date). Based upon that evaluation, the principal executive officer and principal financial officer previously concluded, as of the Evaluation Date, that the Companys disclosure controls and procedures were effective to ensure that information required to be disclosed by the Company in the reports filed or submitted by it under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SECs rules and forms, and that information required to be disclosed by the Company in such reports is
accumulated and communicated to the Companys management, including its principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

Material Weakness Identified:

On October 30, 2006, management and the Audit Committee of the Company determined that the Unaudited Condensed Consolidated Financial Statements for the fiscal quarter ended March 31,2006 contained errors and should no longer be relied upon.  The errors were as a result of an error made in the calculation of the Companys interim tax provision for the quarter ended March 31, 2006.  Our interim preparation and review controls surrounding income taxation failed to fully consider the impact of the disposition that occurred in the period.

27

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In connection with this restatement, management re-evaluated the effectiveness of our disclosure controls and procedures.  Solely as a result of this material weakness, our principal executive officer and principal financial officer have concluded that our disclosure controls and procedures were not effective as of the end of the fiscal quarter ended March 31, 2006.

Material Weakness Previously Identified:

As previously reported in our annual report on Form 10-K for the year ended December 31, 2005, on March 21, 2006, management and the Audit Committee of the Company determined that as of December 31, 2005, a material weakness existed in internal control over financial reporting related to the failure to record invoices for professional services in a timely manner.  This determination resulted from errors identified during the Companys audit for the year ended December 31, 2005.

Management evaluated the cause of these errors and determined that the controls over the collection and recording of invoices for professional services did not operate effectively.  As a result of the actual misstatement that occurred and the lack of other mitigating controls, management determined that this deficiency constituted a material weakness in internal control over financial reporting.  The material weakness resulted in a restatement of the Companys Unaudited Condensed Consolidated Financial Statements for the quarters ended March 31, June 30, and September 30, 2005.

Remediation Activities related to the previously identified material weakness:

The Companys management and Audit Committee have dedicated resources to assessing the underlying issues giving rise to the aforementioned accounting errors relating to the recording of invoices for professional services and to ensure that proper steps have been and are being taken to improve our internal controls.  We have re-evaluated the internal controls relative to this area and have implemented additional internal controls so that, as of March 31, 2006, we believe that we have remediated this material weakness. The Companys remediation plan, which included the implementation of additional controls to ensure proper recording of invoices for professional services in a timely manner, is as follows:

| | Centralized the collection   and recordkeeping of invoices for professional services.       
|- | --------------------------------------------------------------------------------------------
|  |                                                                                             
| | Established balance sheet   reconciliation review meetings with the business process owners.

In addition, the Company will continue to monitor the effectiveness of these remedial actions and make any further changes as management determines to be appropriate.

Changes in Internal Control:

The remediation of the material
weakness described above that occurred and the material weakness related to the
tax calculation that arose during the period ended March 31, 2006, had a
material effect on the Companys internal controls over financial
reporting.

28

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PART II  OTHER INFORMATION

|Item 1.  | Legal   Proceedings                                                                                  
|-------- | -----------------------------------------------------------------------------------------------------
|         |                                                                                                      
|         | See Note 9   to the unaudited interim Condensed Consolidated Financial Statements   contained herein.
|         |                                                                                                      
|Item 1a. | Risk Factors                                                                                         

| | Calgon Carbon could be subject to   significant increases in pension contributions to its defined benefit pension   plans thereby restricting cash flow.  The Company has made commitments to pay   certain retirement benefits to its current and former employees under its   defined benefit pension plans.  The   funded status is determined using many assumptions such as inflation,   investment rates, mortality, turnover, and discount rates which could turn   out to be different than projected.    Currently those plans in the aggregate are significantly under funded,   and require a certain level of mandatory contributions as prescribed by   law.  Significant increases in the   Companys pension liabilities or decreases in pension assets as a result of   actual experience being materially different than the projected assumptions   would result in higher levels of mandatory contributions.  In addition, changes in pension
legislation could also increase funding requirements which would have an   adverse effect on the Companys cash flow and could restrict strategic   investments.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | Calgon Carbons financial results could be   adversely affected by shortages in natural gas supply or increases in natural   gas prices.    Calgon Carbon utilizes natural gas as a key component in its activated   carbon manufacturing process, and has long term contracts for the supply of   natural gas at each of its major facilities.    If shortages of or restrictions on the delivery of natural gas occurs,   production at the Companys activated carbon facilities would be reduced   which could result in missed deliveries or lost sales.  Additionally, the Company hedges its   future supply of natural gas by purchasing forward contracts for up to two   years in duration in order to limit prices fluctuations in the near term and   smooth out the cost volatility. These purchases however do not protect the   Company from longer term trends of rising natural gas prices which could   result in significant production cost
increases.                                                                                                                                                       

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| | Delays in enactment of new state or federal   regulations could restrict Calgon Carbons ability to reach its strategic   growth targets.    The Companys strategic growth initiatives are reliant upon more   restrictive environmental regulations being enacted for the purpose of making   water and air cleaner and safer.  If   stricter regulations are delayed or are not enacted, then the Companys sales   growth targets could be adversely affected.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | Increases in United States and European   imports of Chinese manufactured activated carbon could have an adverse effect   on Calgon Carbons financial results. Calgon Carbon faces competition in its U.S.   and European markets from brokers of low cost imported activated carbon   products, primarily from China.  While   the Company believes it has a technically superior product, if imports increase   and Chinese products are accepted in more applications, the Company could see   declines in sales and profitability as it tries to remain competitive.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | Calgon Carbon uses bituminous coal as the   main raw material in its granular activated carbon production process.  An interruption of supply or an increase   in coal prices could have an adverse effect on Calgon Carbons financial   results.  The   Company has various long term contracts in place for the supply of coal that   expire at various intervals.    Interruptions in coal supply caused by mine accidents, labor disputes,   transportation delays, or other events for other than a temporary period   could have an adverse effect on the Company being able to meet its customer   demand, in addition to increasing production costs.                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | Most of Calgon Carbons hourly workforce is   covered under union contracts; the Companys inability to successfully   negotiate contracts upon expiration could have an adverse affect on financial   results.  The   Company has collective bargaining agreements in place at four of the Companys   productions facilities covering approximately 309 employees that expire from   2007 to 2009.  Any work stoppages as a   result of disagreements with any of the labor unions or the failure to   renegotiate any of the contracts as they expire could disrupt production and   significantly increase product costs as a result of less efficient operations   brought on by temporary labor.                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | Calgon Carbon has locations operating in   multiple foreign countries and as a result is subject to foreign exchange   translation risk which could have an adverse effect on the Companys   financial results.    Calgon Carbon conducts business in the local currencies of each of its   foreign subsidiaries or affiliates.    Those results are then converted to U.S. dollars at prevailing exchange   rates and consolidated into the Companys financial statements.  Changes in exchange rates, particularly   the strengthening of the U.S. dollar, could significantly reduce the   Companys sales and profitability from foreign subsidiaries or affiliates   from one period to the next as local currency amounts are translated into   less U.S. dollars.  The Company does   not hedge foreign translation risk.                                                                                                                                                                                                                                                                                                       
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | Calgon Carbons European and Japanese   activated carbon businesses are sourced from both the United States and China   which subjects the Company to foreign exchange translation risk.Calgon Carbons   only source of production for virgin granular activated carbon is in the   United States and China.  Those   facilities are used to supply all of the Companys global demand of such   product.  The Companys foreign   operations all purchase from the U.S. operations in U.S. dollars, yet sell in   local currency, resulting in foreign exchange translation risk.  The Company attempts to mitigate that risk   in the short term by executing foreign currency derivative contracts of not   more than one year in duration to cover its known or projected foreign   currency exposure.  However, those   contracts do not protect the Company from longer term trends of a   strengthening U.S. dollar, which could significantly
increase the Companys   cost of activated carbon delivered to its European and Japanese markets and   for which the Company may not be able to offset by increases in its prices.

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| | Calgon Carbon has significant domestic and   foreign net operating tax loss (NOL) carryforwards which, if they are not   utilized, would have an adverse effect on the Companys financial results.  The Company has significant deferred tax   assets associated with net operating loss carryforwards that were generated   from both the Companys domestic and foreign operations.  The Company has reduced that value of   these assets by an appropriate valuation allowance for the amounts that are   deemed not likely to be realized.    However if the Company does not meet its projections of profitability   in the future, some or all of those NOLs could expire, which would result in   a reduction of the Companys deferred tax asset and an increase in tax   expense, and which would reduce the Companys profitability.                                           
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | Calgon Carbons business includes capital   equipment sales which could have extreme fluctuations due to the cyclical   nature of that type of business.  Calgon Carbons Equipment segment   approximated 13% of the Companys overall revenues in 2005.  This business generally has a long project   life cycle from bid solicitation to project completion and often requires   customers to make large capital commitments well in advance of project   execution.  In addition, this business   is usually affected by the general health of the overall economy.  As a result, sales and earnings from the   Equipment segment could be volatile.                                                                                                                                                                                                                                   
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | Calgon Carbon could find it difficult to   fund the capital needed to complete its growth strategy due to borrowing   restrictions under its U.S. credit facility.  Calgon Carbon is extended credit under its   U.S. credit facility subject to compliance with certain financial   covenants.  The Company has had to   amend its credit facility several times within the past year in order to cure   violations or remain compliant as financial results have declined.  If the Companys liquidity remains   constrained for more than a temporary period the Company may need to either   delay certain strategic growth projects or access higher cost capital markets   in order to fund the projects.                                                                                                                                                                            
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | Encroachment into Calgon Carbons markets   by competitive technologies could adversely affect financial results.  Activated carbon is utilized in various   applications as a cost effective solution for solving customer problems.  If other competitive technologies are   advanced to the stage in which technologies could effectively compete with   activated carbon costs and technologies, the Company could experience a   decline in sales and profitability.                                                                                                                                                                                                                                                                                                                                                                                                                  
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | Failure to innovate new products or   applications could adversely affect the Companys ability to meet its   strategic growth targets.  One of the ways that Calgon Carbon differentiates itself from   its competition is through its technological superiority in helping customers   to find solutions to their problems through the application of the Companys   products or services.  Part of Calgon   Carbons strategic growth and profitability plans involve the development of   new products or new applications for its current products in order to replace   more mature products or markets that have seen increased competition.  If the Company is unable to develop new   products or applications then the Companys financial results could be   adversely affected.                                                                                               
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | An unplanned shutdown at one of the   Companys production facilities could have an adverse effect on financial   results.  The   Company operates multiple facilities and sources product from strategic   partners that operate facilities that are close to water or in areas   susceptible to earthquakes.  An   unplanned shutdown at any of the Companys or its strategic partners   facilities for more than a temporary period as a result of a labor dispute,   hurricane, typhoon, earthquake or other natural disaster could significantly   affect the Companys ability to meet its demand requirements, thereby   resulting in lost sales and profitability in the short term or eventual loss   of customers in the long term.                                                                                                                                            
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | Calgon Carbon holds a variety of patents   that give the Company a competitive advantage in certain markets.  An inability to defend those patents from   competitive attack could have an adverse effect on both current results as   well as future growth projections.From   time to time in the course of its business the Company has to address   competitive challenges to its patented technology.  Calgon Carbon is currently in litigation to defend its process   patent for the use of ultraviolet light in the prevention of cryptosporidium   infection in drinking water.  While   the Company believes it will prevail in this action, an unfavorable outcome   of that patent defense would impair the Companys ability to capitalize on   substantial future revenues from the licensing of that technology.                                                            
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | Environmental compliance and remediation   could result in substantially increased capital requirements and operating   costs.  The   Companys production facilities are subject to a variety of environmental   laws and regulations in the jurisdictions in which they operate or maintain   properties.  Costs may be incurred in   complying with such laws and regulations if environmental remediation   measures are required.  Each of the   Companys domestic production facilities has permits and licenses regulating   air emissions and water discharges.    All of the Companys domestic production facilities are controlled   under permits issued by local, state, and federal air pollution control   entities.  International environmental   requirements vary and could have substantially lesser requirements that may   give competitors a competitive advantage.

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| | Provisions of Delaware Law and our rights   plan may make a takeover of the Company more difficult.  Certain provisions of Delaware law, our   certificate of incorporation and by-laws and our rights plan could make more   difficult or delay our acquisition by means of a tender offer, a proxy   contest or otherwise and the removal of incumbent directors.  These provisions are intended to   discourage certain types of coercive takeover practices even though such a   transaction may offer our stockholders the opportunity to sell their stock at   a price above the prevailing market price.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | Calgon Carbons international operations   expose it to uncertainties and risks from abroad, which could negatively   affect its results of operations.The   Company has locations in Europe, China, Japan, and the United Kingdom which   are subject to economic conditions and political factors within the   respective countries, which if changed could negatively affect the Companys   results of operations and cash flow.    Political factors include, but are not limited to, taxation,   nationalization, inflation, currency fluctuations, increased regulation and   quotas, tariffs and other protectionist measures.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | We face risks in connection with the   material weaknesses described in our Sarbanes-Oxley Section 404 Management   Report and any other related remedial measures that we may undertake.In connection   with the preparation of our Annual Report on Form 10-K for the fiscal year   ended December 31, 2005, we concluded that our internal controls were   ineffective as of December 31, 2005 as a result of the failure to record   invoices for professional services in a timely manner.  We remediated the identified material   weakness by centralizing the collection and record keeping of invoices for   professional services and establishing balance sheet reconciliation review   meetings with the business process owners.    We also have identified a significant deficiency related to a lack of   segregation of duties with respect to our information systems and are in the   process of implementing changes to remediate this significant   deficiency. 
Subsequent to our Annual   Report, we concluded that our internal controls were ineffective as a result   of an error made in the calculation of the Companys interim tax provision   for the quarters ended March 31 and June 30, 2006, respectively.  We continue to evaluate the effectiveness   of our disclosure controls and procedures and internal control over financial   reporting on an ongoing basis, taking additional remedial action as appropriate.
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | If we are   unable to effectively remediate this material weakness and any other material   weaknesses or significant deficiencies in internal control over financial   reporting that are identified in the future and to assert that disclosure   controls and procedures including internal control over financial reporting   are effective in any future period, we could lose investor confidence in the   accuracy and completeness of our financial reports, which could have an   adverse effect on our stock price and potentially subject us to litigation.  In addition, we may be required to incur   additional costs including but not limited to the potential for hiring   additional personnel to improve our existing internal control system.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         

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|Item 2c. | Unregistered   Sales of Equity Securities and Use of Proceeds
|-------- | -------------------------------------------------------------

|Period                                   |  | Total   Number   of Shares   Purchased (a) |        | Average   Price Paid   Per Share (b) |   | Total   Number of   Shares Purchased   as Part of Publicly   Announced   Repurchase Plans   or Programs (c) |  | Maximum   Number   (or Approximate   Dollar Value)   of Shares that May   Yet be Purchased   Under the Plans or   Programs (d) |  
|---------------------------------------- |  | ------------------------------------------ | ------ | ------------------------------------ | - | ----------------------------------------------------------------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------ | -
|                                         |  |                                            |        |                                      |   |                                                                                                             |  |                                                                                                                                |  
|January 1  January 31,   2006           |  |                                            |       |                                      |   |                                                                                                            |  |                                                                                                                                | 
|February 1  February 28,   2006         |  |                                            | 32,432 |                                      | $ | 7.12                                                                                                        |  |                                                                                                                                | 
|                                         |  |                                            |        |                                      |   |                                                                                                             |  |                                                                                                                                |  
|March 1  March 31, 2006                 |  |                                            |       |                                      |   |                                                                                                            |  |                                                                                                                                | 
|Total for Quarter Ended March   31, 2006 |  |                                            | 32,432 |                                      | $ | 7.12                                                                                                        |  |                                                                                                                                | 
|                                         |  |                                            |        |                                      |   |                                                                                                             |  |                                                                                                                                |  

|                                                                                                                                                                                                                                                                                                            
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) This   column includes purchases under Calgon Carbons Stock Option Plan which represented   withholding taxes due from employees relating to the restricted share awards   issued on February 9, 2006.  Future   purchases under this plan will be dependent upon employee elections and   forfeitures.

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|Item 4. | Submission   of Matters to a Vote of Security Holders                                                                                                                                                                                                                                                     
|------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|        |                                                                                                                                                                                                                                                                                                           
|        | The annual   meeting of stockholders was held April 19, 2006.  In connection with the meeting, proxies were solicited pursuant   to the Securities Exchange Act.  The   following are the voting results on the proposals considered and voted upon   at the meeting and described in the proxy statement.
|        |                                                                                                                                                                                                                                                                                                           
|        | Election of   directors:                                                                                                                                                                                                                                                                                  

|                                                                                                     |  |  | Votes For  |  |  | Votes   Withheld | 
|---------------------------------------------------------------------------------------------------- |  |  | ---------- |  |  | ---------------- | 
|                                                                                                     |  |  |            |  |  |                  | 
|Class   of 2009                                                                                      |  |  |            |  |  |                  | 
|William R. Newlin                                                                                    |  |  | 33,965,090 |  |  | 1,205,137        | 
|John S. Stanik                                                                                       |  |  | 33,903,268 |  |  | 1,266,959        | 
|Robert L. Yohe                                                                                       |  |  | 33,077,430 |  |  | 2,092,796        | 
|Class   of 2008                                                                                      |  |  |            |  |  |                  | 
|Timothy G. Rupert                                                                                    |  |  | 33,709,229 |  |  | 1,460,787        | 
|                                                                                                     |  |  |            |  |  |                  | 
|Ratification   of Deloitte & Touche LLP as Independent Registered Public Accounting Firm   for 2006:

|Votes For  |  | Votes   Against |  | Votes   Withheld
|---------- |  | --------------- |  | ----------------
|           |  |                 |  |                 
|34,917,407 |  | 102,843         |  | 149,977         

|Item 6. | Exhibits                                                                                                                                
|------- | ----------------------------------------------------------------------------------------------------------------------------------------
|        |                                                                                                                                         
|        | Exhibit 31.1   Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to   Section 302 of the Sarbanes-Oxley Act of 2002.
|        |                                                                                                                                         
|        | Exhibit 31.2   Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to   Section 302 of the Sarbanes-Oxley Act of 2002.
|        |                                                                                                                                         
|        | Exhibit 32.1   Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to   Section 906 of the Sarbanes-Oxley Act of 2002.
|        |                                                                                                                                         
|        | Exhibit 32.2   Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to   Section 906 of the Sarbanes-Oxley Act of 2002.

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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.

|                         | CALGON   CARBON CORPORATION
|------------------------ | ---------------------------
|                         |                            
|                         | (REGISTRANT)               
|                         |                            
|                         |                            
|Date:  November 28, 2006 | /s/Leroy M.   Ball         
|                         |                            
|                         | Leroy M.   Ball            
|                         | Senior Vice   President,   
|                         | Chief   Financial Officer  

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EXHIBIT INDEX

|Exhibit No |  | Description                                                                                                            |  | Method of Filing
|---------- |  | ---------------------------------------------------------------------------------------------------------------------- |  | ----------------
|           |  |                                                                                                                        |  |                 
|31.1       |  | Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section
302 of the Sarbanes-Oxley Act of 2002 |  | Filed   herewith
|31.2       |  | Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section
302 of the Sarbanes-Oxley Act of 2002 |  | Filed   herewith
|32.1       |  | Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section
906 of the Sarbanes-Oxley Act of 2002 |  | Filed   herewith
|32.2       |  | Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section
906 of the Sarbanes-Oxley Act of 2002 |  | Filed   herewith

36

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