<PAGE>
 
===============================================================================
                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549

                                ______________

                                    FORM 10-Q

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, 1999
                                    ----------------------------

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

      For the transition period from _________________ to _________________

                        Commission file number  0-14991
                                              ---------

                            LIFE TECHNOLOGIES, INC.
            (Exact name of registrant as specified in its charter)


          DELAWARE                                 34-0431300
  (State or other jurisdiction                  (I.R.S. Employer
  of incorporation or organization)            Identification No.)

  9800 MEDICAL CENTER DRIVE, ROCKVILLE, MD             20850
  (Address of principal executive offices)          (Zip Code)
                            ______________________


      Registrant's telephone number, including area code: (301) 610-8000


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.  Yes  x   No_____
                                       -----        

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 11, 1999
                -----                         ---------------------------
    Common Stock, par value $.01 per share        24,946,667 shares

===============================================================================
<PAGE>
 
                                    PART I
                                    ------
                             FINANCIAL INFORMATION
                             ---------------------

Item 1.   Financial Statements
          --------------------

                            LIFE TECHNOLOGIES, INC.
                       CONSOLIDATED STATEMENT OF INCOME
                 (amounts in thousands, except per share data)

<TABLE>
<CAPTION>
                                             Three months ended
                                                 March 31,
                                            --------------------
                                             1999         1998
---------------------------------------------------------------- 
<S>                                         <C>          <C>
Revenues:
  Net sales                                 $99,537      $88,355
  Net royalties                                 447          437
                                            -------      -------
                                             99,984       88,792
Operating expenses:                                   
  Cost of sales                              44,283       40,878
  Marketing and administrative               32,574       29,035
  Research and development                    5,837        5,192
                                            -------      -------
     Total operating expenses                82,694       75,105
                                            -------      -------
Operating income                             17,290       13,687
                                                      
Other expenses, net                             693           62
                                            -------      -------
Income before income taxes                   16,597       13,625
Income taxes                                  5,808        4,769
                                            -------      -------
Income before minority interests             10,789        8,856
Minority interests                             (297)        (231)
                                            -------      -------
Net income                                  $10,492      $ 8,625
                                            =======      =======
                                                      
Earnings per share:                                   
  Basic                                     $  0.42      $  0.37
  Diluted                                   $  0.42      $  0.36
                                                         
Average shares outstanding:                              
  Basic                                      24,944       23,447
  Diluted                                    25,014       24,029
                                                          
Dividends declared per share                $  0.05      $  0.05
                                                         
Amounts are unaudited.                                   
</TABLE> 
                                                         
The accompanying notes are an integral part of these condensed consolidated
financial statements.                                    

                                       2
<PAGE>
 
Part I - Financial Statements (continued)

                            LIFE TECHNOLOGIES, INC.
                          CONSOLIDATED BALANCE SHEET
                 (amounts in thousands, except per share data)

<TABLE>
<CAPTION>
                                                   March 31,   December 31,
                                                      1999         1998
----------------------------------------------------------------------------
<S>                                                <C>         <C>
ASSETS
Current assets:
  Cash and cash equivalents                         $ 49,290       $ 56,047
  Trade accounts receivable, net                      73,678         67,797
  Inventories:
   Materials and supplies                             12,055         12,946
   In process and finished                            65,355         62,793
   LIFO reserve                                       (1,143)        (1,420)
                                                    --------       --------
     Total inventory                                  76,267         74,319
 
  Prepaid and other current assets                    17,346         16,121
  Current deferred tax assets                          5,893          5,871
                                                    --------       --------
     Total current assets                            222,474        220,155
 
Property, plant and equipment                        169,103        159,540
   Less accumulated depreciation                     (54,127)       (52,166)
                                                    --------       --------
     Total property, plant and equipment             114,976        107,374
 
Investments and other assets                          15,095         15,392
Excess of cost over net assets of
  businesses acquired, net                            10,071         10,666
                                                    --------       --------
     Total assets                                   $362,616       $353,587
                                                    ========       ========
 
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
  Short-term debt                                   $    254       $  2,210
  Accounts payable                                    26,181         23,916
  Accrued and deferred income taxes                    7,142          2,755
  Accrued liabilities and expenses                    26,934         30,871
                                                    --------       --------
     Total current liabilities                        60,511         59,752
 
Pension liabilities                                    9,899          9,103
Deferred income taxes                                  5,173          5,173
Minority interests                                     3,654          3,451
 
Stockholders' equity:
  Common stock                                           249            249
  Additional paid-in capital                          94,192         94,067
  Retained earnings                                  197,447        188,202
  Accumulated other comprehensive income (loss)       (8,509)        (6,410)
                                                    --------       --------
     Total stockholders' equity                      283,379        276,108
                                                    --------       --------
     Total liabilities and stockholders' equity     $362,616       $353,587
                                                    ========       ========
</TABLE>

Amounts as of March 31, 1999 are unaudited.
The accompanying notes are an integral part of these condensed consolidated
financial statements.

                                       3
<PAGE>
Part I - Financial Statements (continued)

                            LIFE TECHNOLOGIES, INC.
                CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
                            (amounts in thousands)
<TABLE>
<CAPTION>
                                                          Three months ended 
                                                               March  31,    
                                                          -------------------
                                                            1999       1998
-----------------------------------------------------------------------------
<S>                                                       <C>        <C>     
CASH INFLOWS (OUTFLOWS)                                                      
Operations:                                                                  
 Net income                                               $ 10,492   $  8,625
 Non-cash items:                                                             
  Depreciation and amortization                              3,931      3,465
  Other                                                        355       (192)
 Changes in assets and liabilities                          (8,742)    (2,347)
                                                          --------   --------
                                                             6,036      9,551
Investments:                                                                 
 Capital expenditures                                      (10,504)   (10,114)
 Acquisitions                                               (1,122)    (1,047)
                                                          --------   --------
                                                           (11,626)   (11,161)
Financing:                                                                   
 Dividends paid                                             (1,245)    (1,168)
 Proceeds from exercise of stock options                     1,593      2,775
 Short-term borrowings (net)                                (1,892)    (1,136)
 Long-term loan repayments                                       -        (23)
                                                          --------   --------
                                                            (1,544)       448
                                                                             
Effect of exchange rate changes on cash                        377        423
                                                          --------   --------
Decrease in cash and cash equivalents                       (6,757)      (739)
Cash and cash equivalents at beginning of period            56,047     19,076
                                                          --------   --------
Cash and cash equivalents at end of period                $ 49,290   $ 18,337
                                                          ========   ======== 
</TABLE>

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

                            LIFE TECHNOLOGIES, INC.
                       STATEMENT OF COMPREHENSIVE INCOME
                            (amounts in thousands)

<TABLE>
<CAPTION>
                                                     Three months ended  
                                                          March 31,      
                                                     --------------------
                                                     1999           1998 
-------------------------------------------------------------------------
<S>                                                  <C>           <C>   
  Net income                                         $10,492       $8,625
  Other comprehensive income                                             
     Currency translation effects                     (2,099)         498
                                                     -------       ------
  Comprehensive income                               $ 8,393       $9,123
                                                     =======       ====== 
</TABLE>
Amounts are unaudited.

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

                                       4
<PAGE>
 
Notes To Financial Statements:
----------------------------- 

BASIS OF PRESENTATION

In the opinion of the Company's management, the unaudited financial statements
reflect all adjustments (which consist of normal recurring adjustments)
necessary to present a fair statement of the results for the interim periods.
The results for the three-month period ended March 31, 1999 are not necessarily
indicative of the results for the year ending December 31, 1999.

EARNINGS PER SHARE

Basic earnings per common share have been computed by dividing net income by the
weighted-average number of common shares outstanding during the period.  Diluted
earnings per common share have been computed by dividing net income by the
weighted-average number of common shares outstanding plus an assumed increase in
common shares outstanding for dilutive securities.

The following table reconciles the weighted average number of common shares
outstanding during each period for basic earnings per share with the comparable
amount for diluted earnings per share.

<TABLE>
<CAPTION>
                                                         Three months ended
                                                                  March 31,
---------------------------------------------------------------------------
(amounts in thousands)                                     1999      1998
--------------------------------------------------------------------------- 
<S>                                                       <C>     <C>
Weighted average shares outstanding-basic                 24,944     23,447
Stock options                                                 70        582
---------------------------------------------------------------------------
Weighted average shares outstanding-diluted               25,014     24,029
---------------------------------------------------------------------------
</TABLE>

COMPREHENSIVE INCOME

The following are included as components of Accumulated Other Comprehensive
Income.

<TABLE> 
<CAPTION> 
(amounts in thousands)                          Foreign currency translation
----------------------------------------------------------------------------
<S>                                                                <C> 
Beginning balance (January 1, 1999)                                $(6,410)
Current period change                                               (2,099)
----------------------------------------------------------------------------
Ending balance (March 31, 1999)                                    $(8,509)
----------------------------------------------------------------------------
</TABLE> 

U.S. and international withholding taxes have not been provided on undistributed
earnings of foreign subsidiaries.  The Company remits only those earnings which
are considered to be in excess of the reasonably anticipated working capital
needs of the foreign subsidiaries, with the balance considered to be permanently
reinvested in the operations of such subsidiaries.  It is impractical to
estimate the total tax liability, if any, until such a distribution is made.

                                       5
<PAGE>
 
Part I - (continued)


SEGMENT REPORTING AND RELATED INFORMATION

The Company has four operating segments.  The Americas Research segment serves
universities, medical research centers, government institutions and other
related "not-for-profit" research institutions in the United States as well as
all customers in Canada, Mexico, Latin and South America.  The U.S.
Bioindustrial segment delivers products and services to biotechnology,
pharmaceutical, chemical and related "for-profit" companies in the United
States.  The European segment serves customers in Europe, Africa and the Middle
East.  The Asia Pacific segment serves customers in Asia, including Japan,
Australasia, China and India.  All four of the operating segments offer
essentially the same products and services.

Intercompany transactions between geographic areas are eliminated prior to
reporting operating segment financial information to the chief operating
decision maker.  All profit related to intercompany transactions between
geographic areas is reported in the operating segment in which the sale to the
Company's trade customer occurs.  Expenses related to developing and managing
the Company's product and service offerings, as well as some expenses managed
globally or not related to operating segments, are not included in operating
segment results.

Operating segment revenues for the quarters ending March 31, 1999 and 1998 were
as follows:

<TABLE>
<CAPTION>
---------------------------------------------------------------------------
(amounts in thousands)                                      1999     1998
---------------------------------------------------------------------------
<S>                                                       <C>      <C>      
Americas Research                                         $33,645  $31,434
U.S. Bioindustrial                                         19,973   16,894
Europe                                                     32,485   28,704
Asia Pacific                                               13,434   11,316
Other                                                         447      444
--------------------------------------------------------------------------- 
Total Revenue                                             $99,984  $88,792
========================================================================== 
</TABLE>

Operating segment profit and a reconciliation to reported operating income for
the quarter ending March 31, 1999 and 1998 were as follows:

<TABLE>
<CAPTION>
--------------------------------------------------------------------------- 
(amounts in thousands)                                    1999      1998
--------------------------------------------------------------------------- 
<S>                                                     <C>        <C>        
Americas Research                                       $ 12,539   $11,063    
U.S. Bioindustrial                                         7,456     6,232    
Europe                                                     9,942     7,091    
Asia Pacific                                               4,052     3,161    
Research and development                                  (5,837)   (5,192)   
Other non-segment expenses                               (10,862)   (8,668)   
--------------------------------------------------------------------------- 
Operating income                                        $ 17,290   $13,687 
===========================================================================
</TABLE>

                                       6
<PAGE>
 
CONTINGENCIES

The Company is subject to potential liability under government regulations,
contractual and other matters and legal actions which are pending or may be
asserted.  These maters have arisen in the ordinary course and conduct of the
Company's business and some are expected to be covered, at least partly, by
insurance.  Estimated amounts for claims that are probable and can be reasonably
estimated are reflected as liabilities of the Company.  The ultimate resolution
of these matters is subject to many uncertainties.  It is reasonably possible
that some of the matters which are pending or may be asserted could be decided
unfavorably to the Company.  These matters, if resolved in a manner unfavorable
to the Company, could have a material adverse effect on the Company's
consolidated financial position, operating results or cash flows when resolved
in a future reporting period.

AUDITORS' REPORT

The financial data included herein have been reviewed by the Company's
independent public accountants, PricewaterhouseCoopers LLP, and their report is
attached.  With respect to the financial data, Pricewaterhouse Coopers LLP
reported that they have applied limited procedures in accordance with
professional standards for a review of such information.  However, their
separate report dated April 12, 1999 appearing herein, states that they did not
audit and they do not express an opinion on that unaudited consolidated
financial information.  Accordingly, the degree of reliance on their report on
such information should be restricted in light of the limited nature of the
review procedures applied.  PricewaterhouseCoopers LLP is not subject to the
liability provisions of Section 11 of the Securities Act of 1933 for their
report on the unaudited consolidated financial information because that report
is not a "report" or a "part" of the registration statement prepared or
certified by PricewaterhouseCoopers LLP within the meaning of Sections 7 and 11
of the Act.

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

Any statements in this quarterly report concerning the Company's business
outlook or future economic performance; anticipated profitability, revenues,
expenses or other financial items; together with other statements that are not
historical facts, are "forward-looking statements" as that term is defined under
the Federal Securities Laws.  Forward-looking statements are subject to risks,
uncertainties and other factors which could cause actual results to differ
materially from those stated in such statements.  Such risks, uncertainties and
factors include, but are not limited to, changes in government funding for life
sciences research, changes in pricing or availability of fetal bovine serum,
changes in currency exchange rates, changes and delays in new product
introduction, customer acceptance of new products, changes in government
regulations, changes in pricing or other actions by competitors and general
economic conditions, as well as other risks detailed in the Company's filings
with the Securities and Exchange Commission.

                                       7
<PAGE>
 
Part I - (continued)


RESULTS OF OPERATIONS

FIRST QUARTER RESULTS

Revenues were $100.0 million in the first quarter of 1999, an increase of 13%
compared with revenues of $88.8 million in the first quarter of 1998.  Net
income of $10.5 million in the first quarter of 1999 represented a 22% increase
over net income of $8.6 million reported in the comparable period of 1998.

In the first quarter of 1999 sales of products other than fetal bovine serum
(FBS) increased by $10.3 million, or 13%, when compared with the first quarter
of 1998 and excluding the effect of changes due to different currency exchange
rates.  FBS net sales declined $0.1 million on a currency comparable basis when
comparing the first quarter of 1999 with the first quarter of 1998 as unit sales
increases of approximately 7% were offset by unit selling price decreases.  FBS
sales represented 10% of net sales in the first quarter of 1999 compared with
11% of net sales in the comparable period of 1998.  Net sales in the first
quarter of 1999 were $1.0 million, or 1%, higher than they would have been at
the exchange rates in effect in the first quarter of 1998.

Gross margins were 55.5% of net sales in the first quarter of 1999 compared with
53.7% of net sales in the first quarter of 1998.  Gross margins improved in the
1999 period due to lower unit costs, favorable currency comparisons and a
favorable change in product mix.  FBS gross margins improved in the first
quarter of 1999 compared with the first quarter of 1998 as unit costs decreased
at a greater rate than unit selling prices.

Marketing and administrative expenses were 32.7% of net sales in the first
quarter of 1999 and 32.9% of net sales in the comparable period of 1998.
Research and development expenses were $5.8 million in the first quarter of
1999, representing a 12% increase over the comparable period in 1998.  Other
expenses, net were $0.7 million in the first quarter of 1999 compared with $0.1
million in the first quarter of 1998.  The increase in other expenses, net was
principally due to higher currency exchange losses somewhat offset by higher
investment income in the 1999 period.  Diluted earnings per share of $0.42 in
the first quarter of 1999 were 17% greater than diluted earnings per share of
$0.36 in the first quarter of 1998.

IMPACT OF THE YEAR 2000

The Company is in the process of replacing its core financial, order
entry/distribution, and manufacturing systems at its major locations worldwide.
The vendor of the software upon which this system is based is continuing to test
the release/version of the software being implemented by the Company and is
making revisions available to the Company as necessary. With these revisions,
the vendor maintains that the software is generally year 2000 compliant. The
Company began the installation of this software in the first quarter of 1998 in
the United States, and currently expects U.S.

                                       8
<PAGE>
 
Part I - continued

installation to be complete in the third quarter of 1999. The Company plans to
complete testing and validation of Year 2000 compliance with respect to this
system during the third quarter of 1999. The Company also currently expects to
have these new systems installed in Europe and Japan region by the end of the
second quarter 1999, and to test and validate these systems by the end of the
century. The Company plans to certify software currently in use at other sites
and not replaced by the new systems for Year 2000 compliance by the third
quarter of 1999. As previously reported, although the Company decided to replace
these core systems several years ago for reasons unrelated to Year 2000
concerns, a portion of the overall project relates to an unanticipated software
upgrade implemented specifically to address Year 2000 issues. Due to the
significant amount of time and effort expended for overall systems replacement
activities, it is difficult to calculate the actual costs specifically
attributable to the Year 2000 software upgrade portion of the project. However,
the Company estimates that the cost of this upgrade (which represents external
costs incurred to date directly related to Year 2000 remediation efforts)
approximates $0.1 million.

The Company is also implementing a comprehensive project plan to identify other
internal and external information technology and non-information technology
systems which may require modification or upgrade to be made Year 2000
compliant.  An inventory and assessment of these systems was substantially
complete by the end of 1998.  Remediation and testing of non-Year 2000 compliant
systems is expected to be completed by the end of the third quarter of 1999.  As
part of this project, the Company expects to develop and test contingency plans
by the third quarter of 1999 which identify workarounds in the event of a
malfunction of a system designated as a priority system at the inventory stage.
In addition, the Company is in the process of identifying suppliers of key goods
and services to all business areas, requesting information about their Year 2000
readiness, and auditing certain key suppliers for Year 2000 readiness.  The
Company plans to evaluate the information received from suppliers on a
continuing basis into Year 2000, and to develop contingency plans where the
information provided raises significant concerns about a vendor's ability to
supply the Company on an uninterrupted basis during the Year 2000 transition.
As of March 31, 1999, external costs incurred related to this part of the
project were not material.  The Company believes that the cost of modifications
necessary to become Year 2000 compliant will be approximately $2.0 million
(principally for capital expenditures), of which approximately $0.2 million has
been spent thus far. There can be no assurance, however, that the Company will
be able to identify all aspects of its business that are subject to Year 2000
problems, or identify Year 2000 problems of customers or suppliers that affect
the Company's business.  There also can be no assurance that the Company's
software vendors are correct in their assertions that the software is Year 2000
compliant or that the Company's estimate of the costs of systems preparation for
Year 2000 compliance will prove ultimately to be accurate.

                                       9
<PAGE>
 
Part I - (continued)


LIQUIDITY AND CAPITAL RESOURCES

Operating activities provided $6.0 million in cash during the first three months
of 1999.  Net income after adjustments for depreciation and amortization was the
principal source of cash from operations in 1999.  Working capital increases
were the principal use of cash from operations.

The Company paid $10.5 million for capital expenditures in the first three
months of 1999.  The Company also paid $1.1 million in deferred purchase
payments related to the 1996 acquisition of Custom Primers Inc.

Financing activities used $1.5 million in cash during the first three months of
1999.  The Company used $1.2 million for its quarterly cash dividend payment and
$1.9 million to reduce outstanding loans.  The Company received $1.6 million
from the exercise of stock options.

Capital expenditures in 1999 are expected to range from $30-35 million of which
$15-20 million is for facility upgrades and expansions with the balance of
expected 1999 capital expenditures for new and replacement machinery, equipment
and management information systems.  The Company expects to pay approximately
$12 million in cash in the second quarter of 1999 to acquire a process
chromotography and research products business.

The Company is actively evaluating licensing possibilities, as well as
acquisition candidates which complement the Company's core cell and molecular
biology and cell culture product lines.  The Company believes it will be able to
generate sufficient cash from its operations and its existing credit facility to
meet all its anticipated cash requirements in 1999 apart from any significant
business acquisition which may occur and which may be financed using cash from
operations, debt, equity, or other sources.

NEW ACCOUNTING PRONOUNCEMENT

The Financial Accounting Standards Board has issued, SFAS No. 133, Accounting
for Derivative Instruments and Hedging Activities, which becomes effective for
years beginning after June 15, 1999.  SFAS No. 133, Accounting for Derivative
Instruments and Hedging Activities, requires that every derivative instrument be
recorded in the balance sheet as either an asset or liability measured at its
fair value.  The statement requires that changes in the derivative's fair value
be recognized in earnings unless specific hedge accounting criteria are met.
The Company believes that the effect of adoption of SFAS No. 133 will not be
material.

Item 3.  Quantitative and Qualitative Disclosures About Market Risks
         -----------------------------------------------------------

Life Technologies is exposed to market risk related to changes in foreign
currency exchange rates, commodity prices, and interest rates, and selectively
uses financial instruments to manage these risks.  The Company does not enter
into financial instruments for speculation or trading purposes.

                                       10
<PAGE>
 
                          PART II - OTHER INFORMATION
                          -------   -----------------


Item 1.   Legal Proceedings - Not applicable.
          -----------------                  

Item 2.   Changes in Securities and Use of Proceeds - Not applicable.
          -----------------------------------------                  

Item 3.   Defaults Upon Senior Securities - Not applicable.
          -------------------------------                  

Item 4.   Submission of Matters to a Vote of Security Holders - Not applicable.
          ---------------------------------------------------                  

Item 5.   Other Information - None.
          -----------------        

Item 6.   Exhibits and Reports on Form 8-K
          --------------------------------

    (a)   Exhibits:
          15.   Letter re unaudited interim financial statements.
          27.   Financial data schedule

    (b)   Reports on Form 8-K.

          The Company filed a Current Report on Form 8-K dated January 25, 1999
          reporting that effective with the close of business on February 1,
          1999, the Company's Common Stock would be delisted from the Nasdaq
          Stock Market, but would be available for immediate quotation on the
          OTC Bulletin Board effective with the start of trading on February 2,
          1999.

                                       11
<PAGE>
 
                                  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.



                                        LIFE TECHNOLOGIES, INC.



Date:  May 13, 1999                     By: /s/ C. Eric Winzer
                                        -----------------------------------
                                        C. Eric Winzer             
                                        Vice President and         
                                        Chief Financial Officer    
                                        (Principal Financial Officer
                                        and Authorized Signatory)   

                                       12
<PAGE>
 
                       REPORT OF INDEPENDENT ACCOUNTANTS


To the Stockholders and Board of Directors
Life Technologies, Inc.


We have reviewed the accompanying consolidated balance sheet of Life
Technologies, Inc. and its subsidiaries as of March 31, 1999, and the related
consolidated statements of income and comprehensive income for the three-month
periods ended March 31, 1999 and 1998, and the related condensed consolidated
statement of cash flows for the three-month periods then ended.  These financial
statements are the responsibility of the Company's management.

We conducted our reviews in accordance with standards established by the
American Institute of Certified Public Accountants.  A review of interim
financial information consists principally of applying analytical procedures to
financial data and making inquiries of persons responsible for financial and
accounting matters.  It is substantially less in scope than an audit conducted
in accordance with generally accepted auditing standards, the objective of which
is the expression of an opinion regarding the financial statements taken as a
whole. Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material modifications that should
be made to the accompanying consolidated financial statements referred to above
for them to be in conformity with generally accepted accounting principles.

We have previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheet as of December 31, 1998, and the
related consolidated statements of income, comprehensive income, stockholders'
equity and cash flows for the year then ended (not presented herein), and in our
report, dated January 22, 1999, we expressed an unqualified opinion on those
consolidated financial statements.



                                    /s/ PricewaterhouseCoopers LLP
                                    PRICEWATERHOUSECOOPERS LLP



McLean, Virginia
April 12, 1999

                                       13
<PAGE>
 
                                 EXHIBIT INDEX
                                 -------------

<TABLE> 
<CAPTION> 
                                                                   Page
                                                                   ----
<S>                                                                <C>   
Exhibit 15    Letter re unaudited interim financial information     15

Exhibit 27    Financial data schedule                               16
</TABLE> 

                                       14