<PAGE>
===============================================================================


                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                    FORM 10-Q

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

                      For the quarter ended March 31, 2002

                                       OR

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

                          Commission File No. 333-81139

                      American Plumbing & Mechanical, Inc.
             (Exact name of Registrant as Specified in Its Charter)

<TABLE>
<S>                                                                 <C>
                DELAWARE                                                 76-0577626
     (State or Other Jurisdiction                                      (IRS Employer
   of Incorporation or Organization)                                Identification No.)

         1950 LOUIS HENNA BLVD.                                             78664
           ROUND ROCK, TEXAS                                              (ZIP Code)
(Address of Principal Executive Offices)
</TABLE>

                                 (512) 246-5260
              (Registrant's telephone number, including area code)


         Indicate by check mark whether the registrant: (1) has filed all
reports required to be filed by Section 13 of 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 [ ]

          As of May 12, 2002, there were outstanding 13,211,383 shares of common
stock and 331,116 shares of Class B common stock of the Registrant.


================================================================================
<PAGE>
              AMERICAN PLUMBING & MECHANICAL, INC. AND SUBSIDIARIES

                 FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2002

                                TABLE OF CONTENTS



<TABLE>
<S>                                                                                                      <C>
Part I - Financial Information........................................................................     2
   ITEM 1.  Financial Statements......................................................................     2
   ITEM 2.  Management's Discussion and Analysis of Financial Condition and Results of Operations.....    10
   ITEM 3.  Quantitative and Qualitative Disclosures About Market Risks...............................    13


Part II - Other Information...........................................................................    14
   ITEM 1. - Legal Proceedings........................................................................    14
   ITEM 2. - Changes in Securities and Use of Proceeds................................................    14
   ITEM 3. - Defaults Upon Senior Securities..........................................................    14
   ITEM 4. - Submission of Matters to a Vote of Security Holders......................................    14
   ITEM 5. - Other Information........................................................................    14
   ITEM 6. - Exhibits and Reports on Form 8-K.........................................................    14


SIGNATURES............................................................................................    16
</TABLE>


                                       1
<PAGE>
                         PART I - FINANCIAL INFORMATION
ITEM 1.  Financial Statements

              AMERICAN PLUMBING & MECHANICAL, INC. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS

                        (In Thousands, Except Share Data)

<TABLE>
<CAPTION>
                                                                                       December 31,     March 31,
                                                                                           2001            2002
                                                                                         ---------      ---------
                                       ASSETS                                                          (Unaudited)
<S>                                                                                    <C>              <C>
CURRENT ASSETS:
   Cash and cash equivalents                                                             $   1,666      $   2,372
   Accounts receivable, net                                                                 96,412        100,716
   Inventories                                                                              12,460         11,358
   Costs and estimated earnings in excess of billings on uncompleted contracts              26,523         27,906
   Prepaid expenses and other current assets                                                 5,358          4,692
                                                                                         ---------      ---------

         Total current assets                                                              142,419        147,044
PROPERTY AND EQUIPMENT, net                                                                 21,702         21,257
GOODWILL, net                                                                              154,739        119,983
OTHER NONCURRENT ASSETS                                                                      4,039          4,074
                                                                                         ---------      ---------

         Total assets                                                                    $ 322,899      $ 292,358
                                                                                         =========      =========

                        LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
   Accounts payable and accrued expenses                                                 $  69,465      $  61,460
   Billings in excess of costs and estimated earnings on uncompleted contracts              14,718         17,301
   Current maturities of capital lease obligations                                             167            125
                                                                                         ---------      ---------

         Total current liabilities                                                          84,350         78,886
LONG-TERM LIABILITIES:
   Long-term debt                                                                          154,568        164,096
   Deferred income taxes                                                                     1,172            913
                                                                                         ---------      ---------

         Total liabilities                                                                 240,090        243,895

COMMITMENTS AND CONTINGENCIES (Note 4)
SERIES A REDEEMABLE PREFERRED STOCK, $.01 par value, $13.00 liquidation value,
   10,000,000 shares authorized, 1,048,820 shares issued and outstanding                    13,635         13,635
STOCKHOLDERS' EQUITY:
   Common stock, $.01 par value, 100,000,000 shares authorized, 13,211,383 shares
     issued and outstanding                                                                    132            132
   Class B common stock, $.01 par value, 5,000,000 shares authorized, 331,116 shares
     issued and outstanding                                                                      3              3
   Additional paid-in capital                                                               41,805         41,503
   Retained earnings/(deficit)                                                              27,426         (6,700)
   Accumulated other comprehensive loss                                                       (192)          (110)
                                                                                         ---------      ---------

         Total stockholders' equity                                                         69,174         34,828
                                                                                         ---------      ---------

         Total liabilities and stockholders' equity                                      $ 322,899      $ 292,358
                                                                                         =========      =========
</TABLE>


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


                                       2
<PAGE>
              AMERICAN PLUMBING & MECHANICAL, INC. AND SUBSIDIARIES

                       CONSOLIDATED STATEMENTS OF INCOME

                                 (In Thousands)
                                  (Unaudited)

<TABLE>
<CAPTION>
                                                              Three Months Ended
                                                                   March 31,
                                                            ------------------------
                                                              2001           2002
                                                            ---------      ---------

<S>                                                         <C>            <C>
REVENUES                                                    $ 143,394      $ 141,754

COST OF REVENUES (including depreciation)                     120,872        120,746
                                                            ---------      ---------

         Gross profit                                          22,522         21,008

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES                   14,264         16,082
GOODWILL AMORTIZATION                                           1,411             --
                                                            ---------      ---------

         Income from operations                                 6,847          4,926

OTHER INCOME (EXPENSE):
   Interest expense                                            (4,726)        (4,124)
   Interest income                                                 36             48
   Other                                                          135            102
                                                            ---------      ---------

         Other expense, net                                    (4,555)        (3,974)
                                                            ---------      ---------

INCOME BEFORE PROVISION FOR INCOME TAXES                        2,292            952

PROVISION FOR INCOME TAXES                                      1,490            451
                                                            ---------      ---------

INCOME BEFORE CUMULATIVE EFFECT OF AN ACCOUNTING CHANGE           802            501

CUMULATIVE EFFECT OF AN ACCOUNTING CHANGE, net of tax              --        (34,627)
                                                            ---------      ---------

NET INCOME /(LOSS)                                                802        (34,126)

PREFERRED DIVIDENDS                                               341            341
                                                            ---------      ---------

NET INCOME/(LOSS) AVAILABLE TO COMMON STOCKHOLDERS          $     461      $ (34,467)
                                                            =========      =========
</TABLE>


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


                                       3
<PAGE>
              AMERICAN PLUMBING & MECHANICAL, INC. AND SUBSIDIARIES


                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                                 (In Thousands)
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                           Three Months Ended
                                                                                                March 31,
                                                                                         ----------------------
                                                                                           2001          2002
                                                                                         --------      --------
<S>                                                                                      <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
   Net income/(loss)                                                                     $    802      $(34,126)
   Adjustments to reconcile net income to net cash provided by operating activities-
       Cumulative effect of an accounting change                                               --        34,751
       Depreciation and amortization                                                        2,800         1,394
       Amortization of deferred compensation expense                                           64            39
       Gain on disposal of property and equipment                                             (73)          (23)
       Deferred income taxes                                                                 (640)          (43)
       Increase (decrease) in cash flows from:
         Accounts receivable, net                                                            (952)       (4,304)
         Inventories                                                                         (930)        1,102
         Costs and estimated earnings in excess of billings on uncompleted contracts       (3,166)       (1,383)
         Prepaid expenses and other current assets                                           (372)          417
         Accounts payable and accrued expenses                                              2,596        (7,923)
         Billings in excess of costs and estimated earnings on uncompleted contracts        1,888         2,583
         Other                                                                                 (2)           54
                                                                                         --------      --------

   Net cash provided by/(used in) operating activities                                      2,015        (7,462)
                                                                                         --------      --------

CASH FLOWS FROM INVESTING ACTIVITIES:
   Additions of property and equipment                                                     (2,470)       (1,017)
   Proceeds from sale of property and equipment                                               139            96
   Earnout payments to founding company stockholders                                       (1,082)           --
                                                                                         --------      --------

   Net cash used in investing activities                                                   (3,413)         (921)
                                                                                         --------      --------

CASH FLOWS FROM FINANCING ACTIVITIES:
   Net borrowings on bank credit facility                                                   3,500         9,500
   Payments of capital lease obligations                                                      (79)          (70)
   Payments of preferred dividends                                                             --          (341)
   Distributions to stockholders                                                             (878)           --
                                                                                         --------      --------

   Net cash provided by financing activities                                                2,543         9,089
                                                                                         --------      --------

NET INCREASE IN CASH AND CASH EQUIVALENTS                                                   1,145           706

CASH AND CASH EQUIVALENTS, beginning of period                                                 87         1,666
                                                                                         --------      --------

CASH AND CASH EQUIVALENTS, end of period                                                 $  1,232      $  2,372
                                                                                         ========      ========

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
   Cash paid for-
     Interest                                                                            $  1,755      $    920
     Income taxes                                                                             118         3,359
</TABLE>


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


                                       4
<PAGE>
              AMERICAN PLUMBING & MECHANICAL, INC. AND SUBSIDIARIES


             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)


1.       ORGANIZATION AND BASIS OF PRESENTATION

         American Plumbing & Mechanical, Inc. and subsidiaries ("AMPAM" or the
"Company"), is the largest company in the United States focused primarily on the
plumbing contracting services industry. The Company also provides heating,
ventilation and air conditioning ("HVAC") and mechanical contracting services.
AMPAM provides plumbing, mechanical and HVAC installation services to single
family residential, multifamily residential and commercial construction
customers.

         These unaudited interim statements should be read in conjunction with
the Company's historical consolidated financial statements and related notes
included in the Annual Report on Form 10-K as filed with the Securities and
Exchange Commission for the year ended December 31, 2001.

         These unaudited interim financial statements have been prepared in
accordance with accounting principles generally accepted in the United States of
America and the rules and regulations of the Securities and Exchange Commission
for reporting interim financial information. Accordingly, they do not include
all of the information and footnotes required by accounting principles generally
accepted in the United States of America for complete financial statements.
Management believes all adjustments necessary for a fair presentation of these
interim statements have been included and are of a normal and recurring nature.
The results of operations for interim periods are not necessarily indicative of
the results for the fiscal year.

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         USE OF ESTIMATES

         The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires the use
of estimates and assumptions by management in determining the reported amounts
of assets and liabilities, disclosures of contingent liabilities at the date of
the financial statements, and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.

         REVENUE RECOGNITION

         The Company recognizes revenue from construction contracts on the
percentage-of-completion method measured by the percentage of cost incurred to
total estimated costs for each contract. Contract costs include all direct
material and labor costs. Provisions for the total estimated losses on
uncompleted contracts are made in the period in which such losses are
determined. Changes in job performance, job conditions, estimated profitability,
and final contract settlements may result in revisions to costs and income, the
effects of which are recognized in the period the revisions are determined.
Revenues from services are recognized when services are performed.

         The current asset, "Costs and estimated earnings in excess of billings
on uncompleted contracts," represents revenues recognized in excess of amounts
billed. The current liability, "Billings in excess of costs and estimated
earnings on uncompleted contracts," represents billings in excess of revenues
recognized.


                                       5
<PAGE>
3.       LONG TERM DEBT

Long-term debt consists of the following (in thousands):

<TABLE>
<CAPTION>
                                                             December 31,    March 31,
                                                                2001           2002
                                                             ------------    ---------
<S>                                                          <C>             <C>
Senior Subordinated Notes                                     $  93,586      $  93,639
Bank Credit Facility                                             60,000         69,500
Capital lease obligations and other long-term obligations         1,149          1,082
                                                              ---------      ---------
                                                                154,735        164,221
Less - Current maturities                                          (167)          (125)
                                                              ---------      ---------
                                                              $ 154,568      $ 164,096
                                                              =========      =========
</TABLE>

         The Credit Facility requires the Company to maintain compliance with
certain specified financial covenants including maximum ratios of funded debt to
EBITDA, a minimum fixed charge coverage ratio, a minimum net worth, a capital
expenditure covenant and other restrictive covenants. Additionally, the terms of
the Credit Facility limit the ability of the Company to incur additional
indebtedness, dispose of assets, make acquisitions or other investments, and to
make various other payments. The Company is in compliance with the covenants of
the Credit Facility. As of March 31, 2002, the Company had borrowings of $69.5
million, leaving $25.5 million in availability under the Credit Facility.

4.       COMMITMENTS AND CONTINGENCIES

LEGAL PROCEEDINGS

         In October 2001, AMPAM and its operating subsidiary AMPAM Christianson,
L.P. filed suit against two former stockholders of Christianson Enterprises who
were holders of Series A Redeemable Preferred Stock ("preferred stock")
alleging, among other things, breaches of certain provisions of the underlying
acquisition agreement pursuant to which AMPAM purchased Christianson Enterprises
n/k/a AMPAM Christianson. In February 2002, the defendants filed a counterclaim
alleging, among other things, anticipatory breach of the acquisition agreement.
On April 1, 2002, the parties finalized a settlement agreement and general
release pursuant to which the defendants and related parties tendered all of
their preferred stock and AMPAM paid the defendants and related parties $3.1
million. As of March 31, 2002, the defendants and their related parties held
524,410 shares of preferred stock with a liquidation value of $6,817,330 and
were due approximately $500,000 for outstanding but undeclared dividends, all of
which were included in the settlement. The parties have no further duties,
obligations, or liabilities to each other related to the acquisition agreement
or preferred stock and have released any and all claims against each other.

         The Company is also involved in disputes or legal actions arising in
the ordinary course of business. Management does not believe the outcome of such
legal actions will have a material adverse effect on the Company's financial
position or results of operations.


                                       6
<PAGE>
INSURANCE

         AMPAM is self insured for health care, workers' compensation, and
general, property and auto liability up to predetermined amounts above which
third party insurance applies. All other types of exposures, including an
umbrella policy, are insured through third party insurance. Management believes
an adequate provision for claims or losses incurred by the Company has been
reflected in the consolidated balance sheets.

INTEREST RATE SWAP

         In order to mitigate the interest rate risk associated with our
variable rate debt, AMPAM entered into an interest rate swap with a notional
amount of $30 million that will expire September 28, 2002. The Company's risk
management policy related to this swap agreement is to hedge the exposure to
interest rate movements on a portion of its long-term debt. Payments are made
based on a fixed rate of 3.51% and received on a LIBOR based variable rate
(2.05% at March 31, 2002), reducing the fixed rate associated with this
transaction to 6.51%. The swap is settled on a quarterly basis with the interest
rate differential received or paid by AMPAM recognized as an adjustment to
interest expense. Any change in value of this contract, real or hypothetical,
would be significantly offset by an inverse change in the value of the variable
rate (LIBOR) on the Credit Facility.

         On March 31, 2002, the Company had a derivative liability of $181,000
included in the accounts payable and accrued liabilities section of the balance
sheet. A corresponding amount, net of income tax benefit of $71,000, was
recorded as a component of stockholders' equity as accumulated other
comprehensive loss.

5.       GOODWILL

         In June 2001, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 142, "Goodwill and Other Intangible
Assets" ("SFAS 142"). SFAS 142 addresses the accounting and reporting for
acquired goodwill and other intangible assets, and provides that goodwill should
not be amortized. Rather, it must be tested for impairment annually or more
frequently if circumstances indicate potential impairment. SFAS 142 was
effective January 1, 2002. SFAS 142 also required the Company to complete a
transitional goodwill impairment test within six months from the date of
adoption. The adoption of SFAS 142 on January 1, 2002, resulted in a write-down
of goodwill of approximately $34.7 million. This charge, which comes from the
Company's commercial operations, is non-cash in nature and does not adversely
affect the Company's financial covenant compliance with its lenders. The
write-down of goodwill was recorded, net of tax benefit of $0.1 million, as a
cumulative effect of a change in an accounting principle.

         Prospectively, the Company will annually evaluate the carrying amount
of goodwill associated with its operating segments using a discounted cash flow
methodology to identify any potential impairment of goodwill.

6.       SERIES A REDEEMABLE PREFERRED STOCK

         As of April 1, 2002, the remaining three holders of the preferred stock
exercised their right to redeem the preferred stock. Due to the restrictions
within the terms of the Company's Credit Facility which restrict the Company's
ability to redeem the preferred stock, the Company is currently negotiating with
the holders of the preferred stock to satisfy its obligations.

         If the Company does not redeem the preferred stock, the Company shall
be prohibited from the following activities without the affirmative vote of not
less than a majority of the holders of the preferred stock, voting together as a
single class:



                                       7
<PAGE>

(i)               incur any additional indebtedness for borrowed money other
                  than borrowings under any credit facility to which the Company
                  is a party at such time and as in effect when any redemption
                  payment becomes due and is unpaid or at the time any dividend
                  payment becomes due and is unpaid;

(ii)              effect (or make any agreement or become obligated to effect)
                  any (a) sale, lease, assignment, transfer or other conveyance
                  of the assets of the Company or its subsidiaries which
                  individually or in the aggregate would constitute a
                  significant subsidiary, (b) consolidation or merger involving
                  the Company or any of its subsidiaries, or (c) dissolution,
                  liquidation or winding-up of the Company or any of its
                  subsidiaries; provided however that in no event shall the
                  Company effect any sale, lease, assignment, transfer or other
                  conveyance of the assets of the Company or its subsidiaries to
                  affiliates of the Company;

(iii)             make (or permit any subsidiary to make) any loan or advance
                  to, or own any stock or other securities of, any subsidiary or
                  other corporation, partnership, or other entity unless it is
                  wholly owned by the Company and except for any such loans and
                  advances which do not in the aggregate exceed $250,000;

(iv)              make any loan or advance to any person, including, without
                  limitation, any employee or director of the Company or any
                  subsidiary, except advances and similar expenditures in the
                  ordinary course of business; or

(v)               acquire, by purchase, exchange, merger or otherwise, all or
                  substantially all of the properties or assets of any other
                  corporation or entity.

7.       OPERATING SEGMENTS

         The Company modified its internal organizational structure during the
fourth quarter of 2001 and divided its business into three reporting segments:
single family residential, multifamily residential and commercial. These
operating segments offer similar products and services with differing
complexities to distinct customer groups. They are managed separately because
each business requires different operating and marketing strategies. All three
reporting segments operate domestically, with no intersegment or foreign sales.
These segments share similar growth strategies and provide plumbing and HVAC
services; however, the different segments provide services to different
customers, and have different competitors.

         AMPAM provides plumbing, HVAC and maintenance and repair services to
single family and multifamily residential customers. The single family
residential market includes housing projects, small condominium projects, and
town house development. The multifamily residential market includes large
condominiums and apartment projects. The Company also provides plumbing, HVAC,
maintenance and repair, and mechanical contracting services to commercial
customers. The commercial market includes retail establishments, office
buildings, hotels, assisted-living centers, waste water and water purification
plants, manufacturing plants and other industrial complexes and public and
private institutional buildings including schools, hospitals, dormitories,
military and other governmental facilities, stadiums, arenas, convention
centers, airports and prisons.


                                       8
<PAGE>
            The financial information presented for each segment does not
allocate corporate overhead costs. Corporate expenses in the periods presented
included costs related to operational, sales and marketing, accounting and
administrative support. Corporate assets primarily include cash, deferred tax
assets, debt issuance costs, goodwill and other intangible assets, fixed assets
related to the Company's corporate office and non-trade accounts receivable. Net
intersegment receivables and payables are reflected in total assets in the
following table.

         Segment information for the quarters ended March 31, 2001 and 2002 is
as follows (in thousands):

<TABLE>
<CAPTION>
2002
                                          Single
                                          Family        Multifamily         Commercial       Corporate        Total
                                         ---------      ------------        ----------       ---------     ---------
<S>                                      <C>            <C>                 <C>              <C>           <C>
Revenues                                 $  72,288         $  38,874         $  30,587        $     5      $ 141,754
Gross profit                                12,180             6,463             2,570          (205)         21,008
Income from operations                       4,231             2,767               361        (2,433)          4,926

Total assets                                58,468            54,284            13,025        166,581        292,358
Capital spending                               366               372               187             92          1,017
Depreciation expense                           671               252               435             31          1,389
</TABLE>


<TABLE>
<CAPTION>
2001
                                          Single
                                          Family        Multifamily         Commercial       Corporate        Total
                                         ---------      ------------        ----------       ---------     ---------
<S>                                      <C>            <C>                 <C>              <C>           <C>
Revenues                                 $  74,170         $  43,409         $  25,815        $     -      $ 143,394
Gross profit                                12,750             8,199             1,681          (108)         22,522
Income from operations                       5,964             5,048                45        (4,210)          6,847

Total assets                                65,132            51,688            22,175        185,894        324,889
Capital spending                             1,738               295               416             21          2,470
Depreciation expense                           702               261               408             18          1,389
</TABLE>


8.       COMPREHENSIVE INCOME/LOSS

         Total Comprehensive Income and Loss for the three months ended March
31, 2001 and 2002 was $0.6 million and $(34.0) million, respectively.


                                       9
<PAGE>
ITEM 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations

         THE FOLLOWING DISCUSSION SHOULD BE READ IN CONJUNCTION WITH OUR
UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS AND RELATED NOTES INCLUDED ELSEWHERE
IN THIS QUARTERLY REPORT ON FORM 10-Q AND THE CONSOLIDATED FINANCIAL STATEMENTS
AND RELATED NOTES AND OTHER DETAILED INFORMATION REGARDING AMPAM INCLUDED IN OUR
ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED DECEMBER 31, 2001 AND OTHER
REPORTS FILED BY US WITH THE SECURITIES AND EXCHANGE COMMISSION.

         This report contains "forward-looking statements" within the meaning of
Section 27A of the Securities Act of 1933, as amended ("Securities Act") and
Section 21E of the Exchange Act to be covered by safe harbors created thereby.
Such forward-looking statements are made only as of the date of this report and
involve known and unknown risks, uncertainties and other important factors that
could cause the actual results, performance or achievements of the Company, or
industry results, to differ materially from any future results, performance or
achievements expressed or implied by such forward-looking statements. Readers
are cautioned that such information involves risks and uncertainties, including
those created by general market conditions, competition and the possibility that
events may occur which limit the ability of American Plumbing & Mechanical, Inc.
and subsidiaries ("AMPAM", the "Company", "we" or "us") to maintain or improve
its operating results. Such risks, uncertainties and other important factors
include, among others, retention of key management, a national economic downturn
or one or more regional downturns in construction, shortages of labor and
specialty building materials, difficulty in obtaining or increased costs
associated with debt financing, seasonal fluctuations in the demand for plumbing
and HVAC systems, and the use of incorrect project cost estimates which are used
to determine our percentage of completion and revenue on uncompleted jobs. All
statements, other than statements of historical facts, included or incorporated
by reference in this report that address activities, events or developments that
we expect or anticipates will or may occur in the future, including such things
as future capital expenditures (including the amount and nature thereof),
business strategy and measures to implement such strategy, competitive
strengths, goals, expansion and growth of our business and operations, plans,
references to future success, as well as other statements which include words
such as "anticipate," "believe," "plan," "estimate," "expect," and "intend" and
other similar expressions, constitute forward-looking statements. Although we
believe that the assumptions underlying the forward-looking statements contained
herein are reasonable, any of the assumptions could be inaccurate, and the
inclusion of such information should not be regarded as a representation that it
will occur.


GENERAL

         American Plumbing and Mechanical, Inc. and subsidiaries ("AMPAM", the
"Company", "we" or "us") is the largest company in the United States focused
primarily on the plumbing contracting services industry. The Company also
provides heating, ventilation and air conditioning ("HVAC") and mechanical
contracting services. We provide plumbing, mechanical and HVAC installation
services to single family residential, multifamily residential and commercial
construction customers.


                                       10
<PAGE>
RESULTS OF OPERATIONS

         The following unaudited consolidated financial information represents
our operations for each of the three month periods presented below.


<TABLE>
<CAPTION>
                                                                    Three months ended March 31,
                                                           ------------------------------------------------
                                                                    2001                        2002
                                                           ---------------------        -------------------
                                                                             (Unaudited)
                                                                       (Dollars in thousands)
<S>                                                        <C>            <C>           <C>          <C>
Revenues                                                   $  143,394        100%       $  141,754      100%
Cost of revenues                                              120,872         84           120,746       85
                                                           ----------     ------        ----------   ------
   Gross profit                                                22,522         16            21,008       15
Selling, general and administrative expenses                   14,264         10            16,082       11
Goodwill amortization                                           1,411          1                --       --
                                                           ----------     ------        ----------   ------
   Income from operations                                       6,847          5             4,926        4
Interest expense                                               (4,726)        (3)           (4,124)      (3)
Other, net                                                        171         --               150       --
                                                           ----------     -------       ----------   -------
   Income before taxes                                          2,292          2               952        1
Provision for income taxes                                      1,490          1               451       --
                                                           ----------     ------        ----------   ------
   Income before cumulative effect of an accounting
     change                                                       802          1               501        1
Cumulative effect of an accounting change                          --         --           (34,627)     (24)
                                                           ----------     ------        ----------   ------
   Net income/(loss)                                              802          1           (34,126)     (24)
Preferred dividends                                               341         --               341       --
                                                           ----------     ------        ----------   ------
   Net income/(loss) available to common shareholders      $      461         --%       $  (34,467)      (24)%
                                                           ==========     =======       ==========   =======
</TABLE>


Three months ended March 31, 2001 compared to three months ended March 31, 2002

         Revenues decreased $1.6 million, from $143.4 million for the three
months ended March 31, 2001 to $141.8 million for the three months ended March
31, 2002. Revenues generated by existing locations declined by $18.0 million,
offset by increases in start-up revenues of $16.4 million. The overall decrease
in revenue was primarily attributable to a decrease in our multifamily
residential segment, offset by an increase in our commercial segment as a result
of our commercial start-up in Northern California. Multifamily residential
operations decreased due to lower activity in Florida and Southern California.

         Gross profit decreased $1.5 million, from $22.5 million for the three
months ended March 31, 2001, to $21.0 million for the three months ended March
31, 2002. Gross profit generated by existing locations declined by $2.9 million,
offset by increases in start-up gross profit of $1.4 million. The decrease in
gross profit was attributable to lower volume in our multifamily residential
segment, offset by increased volume in our commercial segment. Gross margin
decreased from 15.7% for the three months ended March 31, 2001 to 14.8% for the
three months ended March 31, 2002. The decrease in our gross margin is primarily
attributable to a larger portion of our volume being generated from startups.
Excluding startups, gross margins were 15.8% in both periods.

         Selling, general and administrative expenses increased $1.8 million,
from $14.3 million for the three months ended March 31, 2001, to $16.1 million
for the three months ended March 31, 2002. The increase in selling, general and
administrative expenses was primarily due to increased insurance and


                                       11
<PAGE>
personnel costs associated with our single family residential segment and
increased costs of approximately $1.0 million to support the increased volume of
our start-ups.

         The goodwill amortization for the three months ended March 31, 2001 was
$1.4 million. As a result of our adoption of SFAS 142, we no longer amortize
goodwill. See note 5 to the consolidated financial statements for further
discussion of this item.

         Interest expense decreased $0.6 million, from $4.7 million for the
three months ended March 31, 2001 to $4.1 million for the three months ended
March 31, 2002. The decrease in interest expense is attributable to lower levels
of debt and lower interest rates.

         The decrease in the provision for income taxes of $1.0 million results
from lower earnings.

         The cumulative effect of an accounting change represents the charge we
recorded to reflect the transitional impairment adjustment required by SFAS 142.
The goodwill write-down of $34.6 million (net of tax benefit) was generated by
our commercial segment.

         Net income (loss) decreased $34.9 million, from net income of $0.8
million for the three months ended March 31, 2001, to net loss of ($34.1)
million for the three months ended March 31, 2002 The net loss was due to the
write-down of goodwill associated with the commercial segment.

LIQUIDITY AND CAPITAL RESOURCES

         As of March 31, 2002 the Company had $68.2 million in working capital
and $164.0 million of outstanding long-term indebtedness, including capital
lease obligations totaling $1.0 million.

         For the three months ended March 31, 2002, net cash used in operating
activities was $7.5 million. This use of cash was primarily attributable to an
increase in working capital. Cash used in investing activities was $0.9 million
which primarily relates to the capital expenditures of $1.0 million. Cash
provided by financing activities for the three months ended March 31, 2002, was
$9.1 million and was primarily obtained from net borrowings on our Credit
Facility.

         For the three months ended March 31, 2001, net cash provided by
operating activities was $2.0 million resulting primarily from operations,
offset by increases in working capital of $0.9 million. Cash used in investing
activities was $3.4 million which primarily relates to the capital expenditures
of $2.5 million and earnout payments of $1.1 million. Cash provided by financing
activities for the three months ended March 31, 2001, was $2.5 million and was
primarily obtained from net borrowings on our Credit Facility.

         On April 1, 1999, we entered into the Credit Facility with a total
commitment of $95.0 million. The Credit Facility was subsequently amended and
extended to mature on March 31, 2004. The Credit Facility bears interest, at our
option, at the base rate of the arranging bank plus an applicable margin, or at
LIBOR plus an applicable margin. As of March 31, 2002, we had borrowings of
$69.5 million, leaving $25.5 million available under the Credit Facility. During
the first quarter, we further amended the Credit Facility to allow for, among
other things, the settlement of the lawsuit described in note 4 to the
consolidated financial statements. We are in compliance with all covenants of
the Credit Facility. The goodwill impairment resulting from the adoption of SFAS
142 during the first quarter did not adversely affect the Company's financial
covenant compliance with its lenders.

         As of April 1, 2002, the remaining holders of the preferred stock
exercised their right to redeem the preferred stock. Due to the restrictions
within the terms of our Credit Facility which restrict our ability to redeem the
preferred stock, we are currently negotiating with the holders of the preferred
stock to satisfy our obligations. See note 6 to the consolidated financial
statements for further discussion of this item.



                                       12
<PAGE>

         We anticipate that our cash flow from operations and borrowings under
the Credit Facility will provide sufficient cash to enable us to meet our
working capital needs, debt service requirements, and planned capital
expenditures for property and equipment through the foreseeable future.


SEASONALITY

         The plumbing and mechanical contracting services industry is influenced
by seasonal factors, which generally result in lower activity during winter
months than in other periods. As a result, we expect that our revenues and
profits will generally be lower in the first and fourth quarters of each fiscal
year, and higher in the second and third quarters.



ITEM 3.  Quantitative and Qualitative Disclosures About Market Risks

         We are exposed to various market risks primarily related to potential
adverse changes in interest rates. In the normal course of business, we employ
established policies and procedures to manage this risk. Our exposure to changes
in interest rates primarily results from our short-term and long-term debt with
both fixed and floating interest rates. AMPAM's debt with fixed interest rates
consists of Senior Subordinated Notes and capital leases. Our debt with variable
interest rates consists primarily of the Credit Facility.

         In order to mitigate the interest rate risk associated with our
variable rate debt, we entered into an interest rate swap with a notional amount
of $30 million that will expire September 28, 2002. Our risk management policy
related to this swap agreement is to hedge the exposure to interest rate
movements on a portion of our long-term debt. Under the extension, payments are
made based on a fixed rate of 3.51% and received on a LIBOR based variable rate
(2.05% at March 31, 2002), reducing the fixed rate associated with this
transaction to 6.51%. The swap is settled on a quarterly basis with the interest
rate differential received or paid by AMPAM recognized as an adjustment to
interest expense. Any change in value of this contract, real or hypothetical,
would be significantly offset by an inverse change in the value of the variable
rate (LIBOR) on the Credit Facility. A one percent increase in the interest rate
on the variable rate debt would result in an annual increase of $0.7 million in
interest expense.

         On March 31, 2002, we had a derivative liability of $181,000 included
in the accounts payable and accrued liabilities section of the balance sheet. A
corresponding amount, net of income tax benefit of $71,000, was recorded as a
component of stockholders' equity as accumulated other comprehensive loss.

         Other than the items mentioned above, there were no other material
quantitative or qualitative changes during the first three months of fiscal 2002
in the Company's market risk sensitive instruments.


                                       13
<PAGE>
                          PART II - OTHER INFORMATION

ITEM 1. - Legal Proceedings

         In October 2001, AMPAM and its operating subsidiary AMPAM Christianson,
L.P. filed suit against two former stockholders of Christianson Enterprises who
are current holders of Series A Redeemable Preferred Stock ("preferred stock")
alleging, among other things, breaches of certain provisions of the underlying
acquisition agreement pursuant to which AMPAM purchased Christianson Enterprises
n/k/a AMPAM Christianson. In February 2002, the defendants filed a counterclaim
alleging, among other things, anticipatory breach of the acquisition agreement.
On April 1, 2002, the parties finalized a settlement agreement and general
release pursuant to which the defendants and related parties tendered all of
their preferred stock to us and we paid the defendants and related parties $3.1
million. As of March 31, 2002, the defendants and their related parties held
524,410 shares of preferred stock with a liquidation value of $6,817,330 and
were due approximately $500,000 for outstanding but undeclared dividends, all of
which were included in the settlement. The parties have no further duties,
obligations, or liabilities to each other related to the acquisition agreement
or preferred stock and have released any and all claims against each other.

        From time to time we are involved in litigation relating to claims
arising out of operations in the normal course of business. AMPAM maintains
insurance coverage against potential claims in an amount which management
believes to be adequate. Currently, we are not aware of any legal proceedings or
pending claims that we believe will have a material adverse effect on our
consolidated financial position or consolidated results of operations.

ITEM 2. - Changes in Securities and Use of Proceeds

        None.

ITEM 3. - Defaults Upon Senior Securities

         None

ITEM 4. - Submission of Matters to a Vote of Security Holders

         None

ITEM 5. - Other Information

         None

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

(a)      The exhibits to this report are listed below

<TABLE>
<S>               <C>
         *3.1     Amended and Restated Certificate of Incorporation (American Plumbing& Mechanical, Inc. Registration Statement on
                  Form S-4 (File No. 333-81139), Exhibit 3.1).

         *3.2     Amended and Restated Bylaws (American Plumbing & Mechanical, Inc. Registration Statement on Form S-4 (File No.
                  333-81139), Exhibit 3.2).
</TABLE>


                                       14
<PAGE>
<TABLE>
<S>               <C>
         *3.3     Certificate of Designations of 10% Cumulative Redeemable Convertible Preferred Stock, Series A (American
                  Plumbing & Mechanical, Inc. Registration Statement on Form S-4 (File No. 333-81139), Exhibit 3.3).

         *4.1     Indenture, dated May 19, 1999, by and among American Plumbing & Mechanical, Inc., State Street Bank and Trust
                  Company and the other parties named therein with respect to $125,000,000 11 5/8% Senior Subordinated Notes due
                  2008 (American Plumbing & Mechanical, Inc. Registration Statement on Form S-4 (File No. 333-81139), Exhibit
                  4.1).
</TABLE>

*    Incorporated by reference

         The registrant filed no reports on Form 8-K during the period covered
by this quarterly report.


                                       15
<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.

                                 AMERICAN PLUMBING AND MECHANICAL, INC.

Date:  May 15, 2002                     By:  /s/ David C. Baggett
                                             --------------------

                                        David C. Baggett
                                        President
                                        and Chief Financial Officer


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