---

---

SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

---

FORM 10-Q

|/x/ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|--- | ---------------------------------------------------------------------------------------

For the Quarterly Period Ended June 30, 2001

|/ / | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|--- | ----------------------------------------------------------------------------------------

For the transition period from  to

Commission file number 1-9078

---

THE ALPINE GROUP, INC.(Exact name of registrant as specified in its charter)

Delaware(State or other jurisdiction of
incorporation or organization)

22-1620387(I.R.S. Employer
Identification No.)1790 Broadway
New York, New York(Address of principal executive offices)

10019-1412(Zip Code)


212-757-3333(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 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months 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 August 3, 2001Common Stock, $.10 Par Value

13,877,383


---

---

---



PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the requirements of Form 10-Q
and, therefore, do not include all information and footnotes required by generally accepted accounting principles. However, in the opinion of management, all adjustments (which, except as disclosed
elsewhere herein, consist only of normal recurring accruals) necessary for a fair presentation of the results of operations for the relevant periods have been made. Results for the interim periods are
not necessarily indicative of the results to be expected for the year. These financial statements should be read in conjunction with the summary of significant accounting policies and the notes to the
consolidated financial statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2000.

2

---



THE ALPINE GROUP, INC. AND SUBSIDIARIES    CONDENSED CONSOLIDATED BALANCE SHEETS  (in thousands, except share data)

|                                                                                                                                                                          |                                                                                                                                                                   | June 30,
2001              |                                            | December 31,
2000 |          
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------- | ------------------------------------------ | ----------------- | ---------
|
|ASSETS                                                                                                                                                                    |                                                                                                                                                                   |                            |                                            |                  
|Current assets:                                                                                                                                                           |                                                                                                                                                                   |                            |                                            |                   |          
|                                                                                                                                                                          | Cash and cash equivalents                                                                                                                                         |                            | $                                          | 35,594            |          
|                                                                                                                                                                          | Restricted cash                                                                                                                                                   |                            |                                            |                  |          
|                                                                                                                                                                          | Accounts receivable (less allowance for doubtful accounts of $5,754 and $4,998 at June 30, 2001 and December 31, 2000, respectively)                              |                            |                                            | 270,831           |          
|                                                                                                                                                                          | Inventories                                                                                                                                                       |                            |                                            | 275,285           |          
|                                                                                                                                                                          | Other current assets                                                                                                                                              |                            |                                            | 42,138            |          
|                                                                                                                                                                          |                                                                                                                                                                   |                            |                                            |                   |          
|                                                                                                                                                                          |                                                                                                                                                                   | Total current assets       |                                            |                   | 623,848  
|Property, plant and equipment, net                                                                                                                                        |                                                                                                                                                                   |                            | 528,714                                    |                   |          
|Long-term investments and other assets                                                                                                                                    |                                                                                                                                                                   |                            | 144,287                                    |                   |          
|Goodwill (less accumulated amortization of $60,040 and $49,462 at June 30, 2001 and December 31, 2000, respectively)                                                      |                                                                                                                                                                   |                            | 764,666                                    |                   |          
|                                                                                                                                                                          |                                                                                                                                                                   |                            |                                            |                   |          
|                                                                                                                                                                          |                                                                                                                                                                   | Total assets               |                                            | $                 | 2,061,515
|                                                                                                                                                                          |                                                                                                                                                                   |                            |                                            |                   |          
|LIABILITIES AND STOCKHOLDERS' EQUITY                                                                                                                                      |                                                                                                                                                                   |                            |                                            |                  
|Current liabilities:                                                                                                                                                      |                                                                                                                                                                   |                            |                                            |                   |          
|                                                                                                                                                                          | Short-term borrowings                                                                                                                                             |                            | $                                          | 160,000           |          
|                                                                                                                                                                          | Current portion of long-term debt                                                                                                                                 |                            |                                            | 137,705           |          
|                                                                                                                                                                          | Accounts payable                                                                                                                                                  |                            |                                            | 149,209           |          
|                                                                                                                                                                          | Accrued expenses                                                                                                                                                  |                            |                                            | 89,373            |          
|                                                                                                                                                                          |                                                                                                                                                                   |                            |                                            |                   |          
|                                                                                                                                                                          |                                                                                                                                                                   | Total current liabilities  |                                            |                   | 536,287  
|Long-term debt, less current portion                                                                                                                                      |                                                                                                                                                                   |                            | 1,144,175                                  |                   |          
|Minority interest in subsidiaries                                                                                                                                         |                                                                                                                                                                   |                            | 58,310                                     |                   |          
|Other long-term liabilities                                                                                                                                               |                                                                                                                                                                   |                            | 136,264                                    |                   |          
|                                                                                                                                                                          |                                                                                                                                                                   |                            |                                            |                   |          
|                                                                                                                                                                          |                                                                                                                                                                   | Total liabilities          |                                            |                   | 1,875,036
|                                                                                                                                                                          |                                                                                                                                                                   |                            |                                            |                   |          
|Subsidiary-obligated Mandatorily Redeemable Trust Convertible Preferred Securities of Superior Trust I holding solely convertible debentures of Superior, net of discount |                                                                                                                                                                   |                            | 135,475                                    |                   |          
|Commitments and contingencies                                                                                                                                             |                                                                                                                                                                   |                            |                                            |                   |          
|Stockholders' equity:                                                                                                                                                     |                                                                                                                                                                   |                            |                                            |                   |          
|                                                                                                                                                                          | 9% cumulative convertible preferred stock at liquidation value                                                                                                    |                            |                                            | 427               |          
|                                                                                                                                                                          | Common stock, $.10 par value; 25,000,000 shares authorized; (21,846,726 shares and 21,763,055 shares issued at June 30, 2001 and December 31, 2000, respectively) |                            |                                            | 2,185             |          
|                                                                                                                                                                          | Capital in excess of par value                                                                                                                                    |                            |                                            | 161,817           |          
|                                                                                                                                                                          | Accumulated other comprehensive deficit                                                                                                                           |                            |                                            | (22,764           | )        
|                                                                                                                                                                          | Retained earnings                                                                                                                                                 |                            |                                            | 5,847             |          
|                                                                                                                                                                          |                                                                                                                                                                   |                            |                                            |                   |          
|                                                                                                                                                                          |                                                                                                                                                                   |                            | 147,512                                    |                   |          
|                                                                                                                                                                          | Treasury stock, at cost (8,004,302 shares and 8,050,646 shares at June 30, 2001 and December 31, 2000, respectively)                                              |                            |                                            | (95,564           | )        
|                                                                                                                                                                          | Receivable from stockholders                                                                                                                                      |                            |                                            | (944              | )        
|                                                                                                                                                                          |                                                                                                                                                                   |                            |                                            |                   |          
|                                                                                                                                                                          |                                                                                                                                                                   | Total stockholders' equity |                                            |                   | 51,004   
|                                                                                                                                                                          |                                                                                                                                                                   |                            |                                            |                   |          
|                                                                                                                                                                          |                                                                                                                                                                   |                            | Total liabilities and stockholders' equity |                   | $        
|                                                                                                                                                                          |                                                                                                                                                                   |                            |                                            |                   |          

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

3

---

THE ALPINE GROUP, INC. AND SUBSIDIARIES    CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS  (in thousands, except per share data)  (unaudited)

|                                                          |                                                                                                                                                     | Three Months Ended
June 30, |        
|--------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------- | -------
|
|Net sales                                                 |                                                                                                                                                     | $                           | 486,847
|Cost of goods sold                                        |                                                                                                                                                     |                             | 408,379
|                                                          |                                                                                                                                                     |                             |        
|                                                          | Gross profit                                                                                                                                        |                             |        
|Selling, general and administrative expenses              |                                                                                                                                                     |                             | 41,250 
|Amortization of goodwill                                  |                                                                                                                                                     |                             | 5,292  
|Infrequent and unusual charges                            |                                                                                                                                                     |                             | 5,593  
|                                                          |                                                                                                                                                     |                             |        
|                                                          | Operating income                                                                                                                                    |                             |        
|Interest expense                                          |                                                                                                                                                     |                             | (31,814
|Other income (expense), net                               |                                                                                                                                                     |                             | 2,764  
|                                                          |                                                                                                                                                     |                             |        
|                                                          | Income (loss) before income taxes, distributions on preferred securities of subsidiary trust, minority interest and equity in earnings of affiliate |                             |        
|Benefit (provision) for income taxes                      |                                                                                                                                                     |                             | 254    
|                                                          |                                                                                                                                                     |                             |        
|                                                          | Income (loss) before distributions on preferred securities of subsidiary trust, minority interest and equity in earnings of affiliate               |                             |        
|Distributions on preferred securities of subsidiary trust |                                                                                                                                                     |                             | (3,811 
|                                                          |                                                                                                                                                     |                             |        
|                                                          | Income (loss) before minority interest and equity in earnings of affiliate                                                                          |                             |        
|Minority interest in (earnings) losses of subsidiaries    |                                                                                                                                                     |                             | 1,424  
|Equity in earnings of affiliate                           |                                                                                                                                                     |                             | 1,133  
|                                                          |                                                                                                                                                     |                             |        
|                                                          | Net income (loss)                                                                                                                                   |                             |        
|Preferred stock dividends                                 |                                                                                                                                                     |                             | (10    
|                                                          |                                                                                                                                                     |                             |        
|                                                          | Net income (loss) applicable to common stock                                                                                                        |                             | $      
|                                                          |                                                                                                                                                     |                             |        
|Net income (loss) per share of common stock:              |                                                                                                                                                     |                             |        
|                                                          | Basic                                                                                                                                               |                             | $      
|                                                          |                                                                                                                                                     |                             |        
|                                                          | Diluted                                                                                                                                             |                             | $      
|                                                          |                                                                                                                                                     |                             |        
|Weighted average shares outstanding:                      |                                                                                                                                                     |                             |        
|                                                          | Basic                                                                                                                                               |                             |        
|                                                          |                                                                                                                                                     |                             |        
|                                                          | Diluted                                                                                                                                             |                             |        
|                                                          |                                                                                                                                                     |                             |        

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

4

---



THE ALPINE GROUP, INC. AND SUBSIDIARIES    CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS  (in thousands, except per share data)  (unaudited)

|                                                          |                                                                                                                                                     | Six Months Ended
June 30, |        
|--------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------- | -------
|
|Net sales                                                 |                                                                                                                                                     | $                         | 965,163
|Cost of goods sold                                        |                                                                                                                                                     |                           | 809,116
|                                                          |                                                                                                                                                     |                           |        
|                                                          | Gross profit                                                                                                                                        |                           |        
|Selling, general and administrative expenses              |                                                                                                                                                     |                           | 80,920 
|Amortization of goodwill                                  |                                                                                                                                                     |                           | 10,583 
|Infrequent and unusual charges                            |                                                                                                                                                     |                           | 6,416  
|                                                          |                                                                                                                                                     |                           |        
|                                                          | Operating income                                                                                                                                    |                           |        
|Interest expense                                          |                                                                                                                                                     |                           | (65,579
|Loss on sale of securities                                |                                                                                                                                                     |                           | (3,342 
|Other income, net                                         |                                                                                                                                                     |                           | 3,667  
|                                                          |                                                                                                                                                     |                           |        
|                                                          | Income (loss) before income taxes, distributions on preferred securities of subsidiary trust, minority interest and equity in earnings of affiliate |                           |        
|Benefit (provision) for income taxes                      |                                                                                                                                                     |                           | 1,136  
|                                                          |                                                                                                                                                     |                           |        
|                                                          | Income (loss) before distributions on preferred securities of subsidiary trust, minority interest and equity in earnings of affiliate               |                           |        
|Distributions on preferred securities of subsidiary trust |                                                                                                                                                     |                           | (7,615 
|                                                          |                                                                                                                                                     |                           |        
|                                                          | Income (loss) before minority interest and equity in earnings of affiliate                                                                          |                           |        
|Minority interest in (earnings) losses of subsidiaries    |                                                                                                                                                     |                           | 3,745  
|Equity in earnings of affiliate                           |                                                                                                                                                     |                           | 286    
|                                                          |                                                                                                                                                     |                           |        
|                                                          | Net income (loss)                                                                                                                                   |                           |        
|Preferred stock dividends                                 |                                                                                                                                                     |                           | (19    
|                                                          |                                                                                                                                                     |                           |        
|                                                          | Net income (loss) applicable to common stock                                                                                                        |                           | $      
|                                                          |                                                                                                                                                     |                           |        
|Net income (loss) per share of common stock:              |                                                                                                                                                     |                           |        
|                                                          | Basic                                                                                                                                               |                           | $      
|                                                          |                                                                                                                                                     |                           |        
|                                                          | Diluted                                                                                                                                             |                           | $      
|                                                          |                                                                                                                                                     |                           |        
|Weighted average shares outstanding:                      |                                                                                                                                                     |                           |        
|                                                          | Basic                                                                                                                                               |                           |        
|                                                          |                                                                                                                                                     |                           |        
|                                                          | Diluted                                                                                                                                             |                           |        
|                                                          |                                                                                                                                                     |                           |        

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

5

---

THE ALPINE GROUP, INC. AND SUBSIDIARIES    CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY  (in thousands, except share data)  (unaudited)

|                                           |                                                       | Six Months Ended
June 30, 2001 |           
|------------------------------------------ | ----------------------------------------------------- | ------------------------------ | ----------
|
|9% cumulative convertible preferred stock: |                                                       |                                |           
|                                           | Balance at beginning of period                        |                                | 427       
|                                           |                                                       |                                |           
|                                           | Balance at end of period                              |                                | 427       
|                                           |                                                       |                                |           
|Common stock:                              |                                                       |                                |           
|                                           | Balance at beginning of period                        |                                | 21,763,055
|                                           | Employee stock purchase plan                          |                                | 77,679    
|                                           | Stock grants                                          |                                | 5,992     
|                                           |                                                       |                                |           
|                                           |                                                       | Balance at end of period       |           
|                                           |                                                       |                                |           
|Capital in excess of par value:            |                                                       |                                |           
|                                           | Balance at beginning of period                        |                                |           
|                                           | Effect of subsidiaries' equity transactions           |                                |           
|                                           | Employee stock purchase plan                          |                                |           
|                                           | Stock grants                                          |                                |           
|                                           |                                                       |                                |           
|                                           |                                                       | Balance at end of period       |           
|                                           |                                                       |                                |           
|Accumulated other comprehensive deficit:   |                                                       |                                |           
|                                           | Balance at beginning of period                        |                                |           
|                                           | Foreign currency translation adjustment               |                                |           
|                                           | Unrealized gains on derivatives, net of tax           |                                |           
|                                           | Realized losses on securities, net of tax             |                                |           
|                                           | Change in unrealized losses on securities, net of tax |                                |           
|                                           |                                                       |                                |           
|                                           |                                                       | Balance at end of period       |           
|                                           |                                                       |                                |           
|Retained earnings:                         |                                                       |                                |           
|                                           | Balance at beginning of period                        |                                |           
|                                           | Net loss                                              |                                |           
|                                           | Stock grants from treasury stock                      |                                |           
|                                           | Dividends on preferred stock                          |                                |           
|                                           |                                                       |                                |           
|                                           |                                                       | Balance at end of period       |           
|                                           |                                                       |                                |           
|Treasury stock:                            |                                                       |                                |           
|                                           | Balance at beginning of period                        |                                | (8,050,646
|                                           | Purchase of treasury stock                            |                                | (73,457   
|                                           | Stock grants                                          |                                | 119,801   
|                                           |                                                       |                                |           
|                                           |                                                       | Balance at end of period       |           
|                                           |                                                       |                                |           
|Receivable from stockholders:              |                                                       |                                |           
|                                           | Balance at beginning of period                        |                                |           
|                                           | Loans to stockholders                                 |                                |           
|                                           | Loan forgiveness                                      |                                |           
|                                           |                                                       |                                |           
|                                           |                                                       | Balance at end of period       |           
|                                           |                                                       |                                |           
|Total stockholders' equity                 |                                                       |                                |           
|                                           |                                                       |                                |           
|Comprehensive loss                         |                                                       |                                |           
|                                           |                                                       |                                |           

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

6

---



THE ALPINE GROUP, INC. AND SUBSIDIARIES    CONSOLIDATED STATEMENTS OF CASH FLOWS  (in thousands)  (unaudited)

|                                                     |                                                   | Six Months Ended
June 30,                                                                |                                                                            
|---------------------------------------------------- | ------------------------------------------------- | ---------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------
|
|Cash flows from operating activities:                |                                                   |                                                                                          |                                                                            
|                                                     | Net income (loss)                                 |                                                                                          | $                                                                          
|                                                     |                                                   | Adjustments to reconcile net income (loss) to net cash provided by operating activities: |                                                                            
|                                                     |                                                   |                                                                                          | Depreciation and amortization                                              
|                                                     |                                                   |                                                                                          | Amortization of deferred debt issuance costs and accretion of debt discount
|                                                     |                                                   |                                                                                          | Compensation expense related to stock options and grants                   
|                                                     |                                                   |                                                                                          | Provision (benefit) for deferred income taxes                              
|                                                     |                                                   |                                                                                          | Minority interest in earnings (losses) of subsidiary                       
|                                                     |                                                   |                                                                                          | Equity in earnings of affiliates                                           
|                                                     |                                                   |                                                                                          | Change in assets and liabilities:                                          
|                                                     |                                                   |                                                                                          |                                                                            
|                                                     |                                                   |                                                                                          |                                                                            
|                                                     |                                                   |                                                                                          |                                                                            
|                                                     |                                                   |                                                                                          |                                                                            
|                                                     |                                                   |                                                                                          |                                                                            
|                                                     |                                                   |                                                                                          |                                                                            
|Cash flows provided by operating activities          |                                                   |                                                                                          | 9,887                                                                      
|                                                     |                                                   |                                                                                          |                                                                            
|Cash flows from investing activities:                |                                                   |                                                                                          |                                                                            
|                                                     | Capital expenditures                              |                                                                                          |                                                                            
|                                                     | Proceeds from sale of investment                  |                                                                                          |                                                                            
|                                                     | Proceeds from sale of assets                      |                                                                                          |                                                                            
|                                                     | Purchase of investments in derivatives            |                                                                                          |                                                                            
|                                                     | Superior Israel customer loans                    |                                                                                          |                                                                            
|                                                     | Restricted cash                                   |                                                                                          |                                                                            
|                                                     | Other                                             |                                                                                          |                                                                            
|                                                     |                                                   |                                                                                          |                                                                            
|Cash flows used for investing activities             |                                                   |                                                                                          | (2,772                                                                     
|                                                     |                                                   |                                                                                          |                                                                            
|Cash flows from financing activities:                |                                                   |                                                                                          |                                                                            
|                                                     | Borrowings under revolving credit facilities, net |                                                                                          |                                                                            
|                                                     | Short-term borrowings, net                        |                                                                                          |                                                                            
|                                                     | Repayments of long-term borrowings                |                                                                                          |                                                                            
|                                                     | Long-term borrowings                              |                                                                                          |                                                                            
|                                                     | Purchase of treasury shares                       |                                                                                          |                                                                            
|                                                     | Other                                             |                                                                                          |                                                                            
|                                                     |                                                   |                                                                                          |                                                                            
|Cash flows provided by financing activities          |                                                   |                                                                                          | 5,926                                                                      
|                                                     |                                                   |                                                                                          |                                                                            
|Net increase (decrease) in cash and cash equivalents |                                                   |                                                                                          | 13,041                                                                     
|Cash and cash equivalents at beginning of period     |                                                   |                                                                                          | 22,553                                                                     
|                                                     |                                                   |                                                                                          |                                                                            
|Cash and cash equivalents at end of period           |                                                   | $                                                                                        | 35,594                                                                     
|                                                     |                                                   |                                                                                          |                                                                            
|Supplemental disclosures:                            |                                                   |                                                                                          |                                                                            
|                                                     | Cash paid for interest                            |                                                                                          | $                                                                          
|                                                     |                                                   |                                                                                          |                                                                            
|                                                     | Cash paid for income taxes, net of refunds        |                                                                                          | $                                                                          
|                                                     |                                                   |                                                                                          |                                                                            

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

7

---



THE ALPINE GROUP, INC. AND SUBSIDIARIES        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS        JUNE 30, 2001        (unaudited)

1. Basis of presentation

The accompanying unaudited condensed consolidated financial statements include the accounts of The Alpine Group, Inc. and its majority-owned subsidiary
(collectively, unless the context otherwise requires, "Alpine" or the "Company"). Certain reclassifications have been made to the prior period presentation to conform to the current period
presentation.

Alpine's
operations are carried out through Superior TeleCom Inc. (together with its subsidiaries, unless the context otherwise requires, "Superior"), a 50.8% owned subsidiary,
which manufactures wire and cable products for the communications, original equipment manufacturer ("OEM") and electrical markets.

Alpine
also holds a 48% common equity interest and $19.8 million of convertible preferred stock in PolyVision Corporation, a global manufacturer of visual communications and
related products. Alpine currently accounts for its investment in PolyVision under the equity method of accounting.

In
July 2001, the Financial Accounting Standards Board issued SFAS No. 141 "Business Combinations" and SFAS No. 142 "Goodwill and Other Intangible Assets." SFAS
No. 141 requires use of the purchase method in accounting for business combinations initiated after June 30, 2001. SFAS No. 142, which is effective for the Company beginning
January 1, 2002, requires that goodwill and certain other intangible assets be reviewed annually for impairment. SFAS No. 142 also requires companies to cease amortization of existing
goodwill and certain intangible assets upon adoption of this statement. Beginning January 1, 2002, the Company will discontinue recognition of expense charges for amortization of goodwill.
Goodwill will be subject to impairment reviews beginning in the first quarter of 2002 and may result in future write-downs. Management is in the process of evaluating what impact the initial
impairment assessments may have on the Company's financial statements.



Superior, to a limited extent, uses derivative financial instruments to manage foreign currency exchange and commodity price risks. Alpine, to a limited
extent, uses derivative financial instruments to manage market price risk related to investments. The Company does not hold or issue derivative financial instruments for trading purposes.

Effective
January 1, 2001, the Company adopted SFAS No. 133 "Accounting for Derivative Instruments and Hedging Activities" as amended by SFAS No. 137 and SFAS
No. 138. These statements establish accounting and reporting standards for derivative instruments and require recognition of all derivatives as either assets or liabilities in the statements of
financial position and measurement of those instruments at fair value. The cumulative effect of the change in accounting upon adoption of SFAS No. 133 was not material.

Superior
has entered into certain commodity contracts to hedge future sale commitments and LIFO inventory layers that are anticipated to be liquidated before year end which are
designated as fair value hedges. Changes in the fair value of these contracts are recorded in the Condensed Consolidated Statement of Operations in the same line item as the underlying exposure being
hedged with any ineffective portion of a financial instrument hedge immediately recognized in earnings.

The
Company has also entered into certain covered options to hedge forecasted sales of investments which are designated as cash flow hedges. The Company has executed "collar"
agreements

8

---

related to 10.5 million shares of Cookson Group plc ("Cookson") common stock, protecting the Company against future declines in Cookson share price while limiting the Company's participation in
Cookson share value appreciation beyond certain threshold levels. Changes in the fair value of these contracts are recorded in Accumulated Other Comprehensive Deficit with any ineffective portion of
the hedge immediately recognized in earnings. These arrangements allow borrowings by the Company against minimum threshold share value levels. Proceeds from such borrowings amounted to approximately
$20.7 million at June 30, 2001 and are expected to be self-liquidating from sale proceeds of the underlying Cookson shares (and proceeds from the derivative instrument, to the extent Cookson
share price has declined below threshold levels) upon expiration of the "collar" agreements in 2003.

The
net impact of hedge ineffectiveness for the three and six months ended June 30, 2001 was immaterial.

2. Inventories

At June 30, 2001 and December 31, 2000, the components of inventories were as follows:

June 30,
2001

December 31,
2000(in thousands)Raw materials

$
37,131

$
45,793Work in process


45,941


42,006Finished goods


195,779


190,782278,851


278,581LIFO reserve


(3,566
)

(16,722
)$
275,285

$
261,859


Inventories
valued using the LIFO method amounted to $148.5 million and $133.6 million at June 30, 2001 and December 31, 2000, respectively.

9

---

3. Comprehensive income

The components of comprehensive income (loss) for the three and six months ended June 30, 2001 and 2000 were as follows:

Three Months Ended
June 30,

Six Months Ended
June 30,2001

2000

2001

2000(in thousands)Net income (loss)

$
(3,717
)
$
2,814

$
(9,574
)
$
2,684Foreign currency translation adjustment


1,454


(1,045
)

(133
)

(427
)Unrealized gains on derivatives, net of tax


1,403





1,403


Realized losses on securities, net of tax








2,089


Change in unrealized losses on securities, net of tax


(2,476
)

8,254


(7,213
)

(13,463
)Comprehensive income (loss)

$
(3,336
)
$
10,023

$
(13,428
)
$
(11,206
)


4. Restructuring accrual



Since the acquisition of Essex International Inc. ("Essex") in November 1998, Superior has been involved in the consolidation and integration of
manufacturing, corporate and distribution functions of Essex into Superior. As a result, Superior initially accrued as part of the Essex acquisition purchase price a $29.7 million provision,
which included $11.8 million of employee termination and relocation costs, $11.9 million of facility consolidation costs, $4.4 million of management information system project
termination costs, and $1.6 million of other exit costs. During 1999, Superior revised its estimate and, as a result, increased the provision for employee termination and relocation costs,
facility consolidation costs, and other exit costs by $6.1 million, $0.2 million and $1.3 million, respectively, and decreased the provision for management information system
project termination costs by $1.4 million. The net increase to the accrual of $6.2 million was reflected as an increase in goodwill. As of June 30, 2001, $17.7 million,
$11.5 million, $3.0 million and $2.6 million have been incurred and paid related to employee termination and relocation costs, facility consolidation costs, management information
system project termination costs and other exit costs, respectively. The provision for employee termination and relocation costs was primarily associated with selling, general and administrative
functions within Essex. The provision for facility consolidation costs included both manufacturing and distribution facility rationalization and the related costs associated with employee severance.
The restructuring resulted in the severance of approximately 1,100 employees. All significant aspects of the plan are complete.



During 2000, Superior's 50.2% owned Israeli subsidiary, Superior Cables Limited ("Superior Israel"), recorded a $3.8 million restructuring charge for
the consolidation of manufacturing facilities. As of June 30, 2001, $3.7 million has been incurred and paid. The restructuring actions eliminated approximately 123 positions, most of
which were manufacturing related employees. During the six months ended June 30, 2001, Superior Israel recorded a $1.0 million restructuring charge for additional

10

---

exit costs associated with the restructuring. All significant aspects of the restructuring plan are complete.

5. Debt

Superior's operating activities are financed principally by a revolving credit facility which, along with Term Loan A and Term Loan B, comprise Superior's
$1.15 billion Amended and Restated Credit Agreement (the "Credit Agreement"). On July 5, 2001, Superior and its principal lenders executed an amendment to the Credit Agreement (the
"Amended Credit Agreement") effective June 30, 2001. The
Amended Credit Agreement provides for, among other things, less stringent financial covenant requirements through June 2002, consistent with management's current forecast of operating results
for such period. Also, pursuant to the Amended Credit Agreement, Superior is obligated to make, in addition to scheduled term loan repayments, a $175 million term loan prepayment by
July 1, 2002. It is contemplated that funds for such pre-payment would be generated from proceeds of a major asset divestiture or other equity transaction ("Deleveraging Proceeds
Transaction") to be completed prior to such date. The Amended Credit Agreement also requires Superior to execute a definitive agreement related to a Deleveraging Proceeds Transaction by
January 31, 2002 or Superior will be required to meet substantially more stringent financial covenant requirements. If Superior is not able to enter into any such definitive agreement or
complete a Deleveraging Proceeds Transaction, it would likely not be able to meet the more stringent financial covenants or make the mandatory prepayment required under the Amended Credit Agreement.
Either of these events would cause Superior to be in default under the Credit Agreement and would require Superior to seek a waiver under or other modification of the Credit Agreement. However, there
can be no assurance that Superior would be able to obtain any such waiver or modification. Furthermore, if certain other interim deleveraging milestones are not met, the Amended Credit Agreement
requires the suspension of cash interest payments on Superior's $200 million subordinated notes on November 30, 2001 (which would require Superior to obtain the consent of the
subordinated note holders, the failure of which to obtain would result in an event of default under the subordinated notes) and the suspension of dividend payments on the outstanding Trust Convertible
Preferred Securities. Superior intends to proceed expeditiously in completing a Deleveraging Proceeds Transaction. Although there can be no certainty, Superior anticipates that such transaction can be
completed within the time frame and in an aggregate dollar amount sufficient to comply with all Amended Credit Agreement covenant requirements.

Pursuant
to the Amended Credit Agreement, the interest rate on the revolving credit facility has been increased to LIBOR plus 3.75% or the base rate (prime) plus 2.75%; and the
interest rate on term loans A and B has been adjusted to LIBOR plus 3.75% or the base rate (prime) plus 2.75% and LIBOR plus 4.25% or the base rate (prime) plus 3.25%, respectively. Superior paid a
fee of $2.3 million to its lenders to secure these modifications.

11

---

6. Earnings per share

The computation of basic and diluted earnings per share for the three and six months ended June 30, 2001 and 2000 is as follows:

|                                                                            |  | Three Months Ended June 30,
|--------------------------------------------------------------------------- |  | ---------------------------
|
|
|
|Net income (loss)                                                           |  | $                          
|Less: preferred stock dividends                                             |  |                            
|                                                                            |  |                            
|Basic earnings (loss) per common share                                      |  |                            
|                                                                            |  |                            
|Dilutive impact of stock options, warrants and grants                       |  |                            
|Dilution in subsidiary and affiliate earnings from common stock equivalents |  |                            
|                                                                            |  |                            
|Diluted income (loss) per common share                                      |  | $                          
|                                                                            |  |                            

|                                                                            |  | Six Months Ended June 30,
|--------------------------------------------------------------------------- |  | -------------------------
|
|
|
|Net income (loss)                                                           |  | $                        
|Less: preferred stock dividends                                             |  |                          
|                                                                            |  |                          
|Basic earnings (loss) per common share                                      |  |                          
|                                                                            |  |                          
|Dilutive impact of stock options, warrants and grants                       |  |                          
|Dilution in subsidiary and affiliate earnings from common stock equivalents |  |                          
|                                                                            |  |                          
|Diluted earnings (loss) per common share                                    |  | $                        
|                                                                            |  |                          

The
Company has excluded the assumed conversion of Superior's Trust Convertible Preferred Securities from the diluted earnings per share calculation as the impact would be
anti-dilutive.

7. Infrequent and unusual charges

The Company incurred infrequent and unusual charges of $5.6 million and $6.4 million during the three and six months ended June 30, 2001,
respectively. Superior incurred infrequent and unusual charges of
$0.2 million and $1.0 million during the three and six months ended June 30, 2001, respectively, related to restructuring activities at Superior Israel. Alpine incurred infrequent
and

12

---

unusual charges of $5.4 million during the three months ended June 30, 2001 related principally to the recognition of certain unfunded prior year retirement plan obligations upon
termination of benefits for certain employees. During the three and six months ended June 30, 2000, Superior incurred infrequent and unusual charges of $3.0 million and
$8.8 million, respectively, primarily associated with the rationalization of certain Essex manufacturing facilities. Such costs included relocation of equipment, training of new employees and
production inefficiencies associated with the rationalization.

8. Business segments

The Company's reportable segments are strategic businesses that offer different products and services to different customers. These include Superior's
communications, OEM and electrical segments. The communications segment includes (i) copper and fiber optic outside plant wire and cable for voice and data transmission in telecommunications
networks, (ii) copper and fiber optic datacom or premise wire and cable for use within homes and offices for local area networks, Internet connectivity and other applications and
(iii) Superior's 50.2% owned Israeli subsidiary Superior Cables Limited. The OEM segment includes magnet wire and related products. The electrical segment includes building and industrial wire
and cable.

The
Company evaluates segment performance based on a number of factors, with operating income being the most critical. Intersegment sales are generally recorded at cost, are not
significant and, therefore, have been eliminated below.

13

---

Operating results for each of the Company's three reportable segments are presented below. Corporate and other items shown below are provided to reconcile to the Company's condensed
consolidated statements of operations and balance sheets.

Three Months Ended
June 30,

Six Months Ended
June 30,2001

2000

2001

2000(in thousands)Net sales:Communications

$
216,345

$
226,681

$
421,976

$
426,055OEM


139,793


158,476


290,384


320,855Electrical


130,709


164,929


252,803


301,072$
486,847

$
550,086

$
965,163

$
1,047,982


Three Months Ended
June 30,

Six Months Ended
June 30,2001

2000

2001

2000(in thousands)Operating income (loss):Communications

$
35,781

$
37,553

$
65,701

$
65,970OEM


12,863


20,401


28,803


42,238Electrical


(3,883
)

6,161


(5,896
)

8,142Corporate and other


(7,543
)

(6,833
)

(13,481
)

(13,772
)Amortization of goodwill


(5,292
)

(5,249
)

(10,583
)

(10,481
)Infrequent and unusual charges


(5,593
)

(2,956
)

(6,416
)

(8,812
)$
26,333

$
49,077

$
58,128

$
83,285


June 30,
2001

December 31,
2000Total assets:Communications

$
530,485

$
544,561OEM


313,096


302,690Electrical


279,203


271,831Corporate and other (including goodwill)


938,731


974,664$
2,061,515

$
2,093,746


14

---

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

General

The Alpine Group, Inc. (together with its subsidiaries, unless the context otherwise requires, "Alpine" or the "Company") is an industrial holding
company with investments in two manufacturing companies.

Superior TeleCom Inc.

Alpine holds a 50.8% common equity interest in its consolidated subsidiary, Superior TeleCom Inc. (together with its subsidiaries, unless the context
otherwise requires, "Superior"), whose balance sheet accounts and results of operations are consolidated in the financial statements of Alpine.

Superior
manufactures a broad portfolio of wire and cable products grouped into the following primary industry segments: (i) communications, (ii) original equipment
manufacturer ("OEM") and (iii) electrical. The Communications Group includes communications wire and cable products sold to telephone companies, other local exchange and interexchange carriers,
distributors and systems integrators, principally in North America. In addition, included within the Communications Group is Superior's 50.2% owned Israeli subsidiary, Superior Cables Limited
("Superior Israel"), which manufactures a range of wire and cable products in Israel, including communications cable, power cable and other industrial and electronic wire and cable products. The OEM
Group includes magnet wire and accessory products for motors, transformers and electrical controls sold primarily to OEMs. The Electrical Group includes building and industrial wire for
applications in commercial and residential construction and industrial facilities. Industry segment financial data for Superior's principal industry segments is included in Note 8 to the
accompanying condensed consolidated financial statements.

Copper
is one of the principal raw materials used in Superior's wire and cable product manufacturing. Fluctuations in the price of copper do affect per unit product pricing and
related revenues. However, the cost of copper has not had a material impact on profitability as Superior, in most cases, has the ability to adjust prices billed for its products to properly match the
copper cost component of its inventory shipped.

PolyVision Corporation

Alpine holds a 48% common equity interest and $19.8 million of convertible preferred stock in its unconsolidated affiliate, PolyVision Corporation
("PolyVision"), a global manufacturer of visual communications and related products for the education/office markets, menus and merchandising boards for food service and banking institutions, and high
performance wall systems used in the education, transportation and select architectural markets.

Alpine
currently accounts for its investment in PolyVision under the equity method of accounting resulting in recognition of Alpine's proportionate share of PolyVision's earnings or
losses as a one-line item within the statements of operations.

Cookson Group plc

Alpine also holds a 2% interest in Cookson ordinary shares with such investment accounted for as an available for sale investment with unrealized holding gains
and losses reflected as a component of other comprehensive income. Dividends paid on the Cookson ordinary shares are recognized as other income in the statement of operations.

15

---

Results of OperationsThree Month Period Ended June 30, 2001 as Compared to the Three Month Period Ended June 30, 2000

Consolidated sales for the quarter ended June 30, 2001 were $486.8 million, a decrease of 11.5% as compared to sales of $550.1 million for
the quarter ended June 30, 2000. Adjusted for a constant cost of copper, the sales decline in the June 2001 quarter as compared to the June 2000 quarter was approximately 10.5%.

Superior's
Communications Group sales for the June 30, 2001 quarter were $216.3 million, a decrease of 5% on a copper-adjusted basis over the June 30, 2000
quarter. The sales decline in the current quarter as compared to the prior year period was due primarily to a 7% reduction in comparative sales of copper outside plant ("OSP") cables, which are used
principally by telephone companies in the local loop segment of the telephony network. OSP cables sales were lower due to the impact of the loss of a major customer contract that occurred in the third
quarter of 2000, which was partially offset by strengthening domestic and international demand for copper OSP cables during the June 30, 2001 quarter. Sales of fiber optic cable continued to
expand on a comparative basis in the June 30, 2001 quarter, increasing 86% over the comparative prior year period.

Superior's
OEM Group sales were $139.8 million for the quarter ended June 30, 2001, reflecting a copper-adjusted decline of 11% as compared to the June 30, 2001
quarter. The current quarter comparative sales decline reflected softening demand for magnet wire from Superior's major OEM customers due principally to general industrial sector weakness which has
existed since the third quarter of 2000, and has impacted end customer demand, particularly in the automotive and power distribution and generation sectors.

Superior's
Electrical Group sales were $130.7 million for the June 30, 2001 quarter representing a decline of 18% on a copper-adjusted basis as compared to the quarter
ended June 30, 2000. The comparative sales decline was due to severe price competition caused by current industry overcapacity coupled with weaker industry-wide demand levels as a
result of overall economic conditions. The impact
of lower prices, on a copper-adjusted basis, for the June 2001 quarter amounted to approximately $6 million as compared to the June 2000 quarter.

Consolidated
sales for the six month period ended June 30, 2001 were $965.2 million, a decrease of 8% as compared to sales of $1.048 billion for the six month
period ended June 30, 2000. The comparative reduction in sales for the 2001 six month period was due primarily to comparative declines of 14% and 10% in Superior's Electrical Group and OEM
Group sales, respectively.

Gross
profit for the June 30, 2001 quarter was $78.5 million, a decline of $20.2 million as compared to gross profit of $98.7 million for the quarter ended
June 30, 2000. The gross profit margin in the June 2001 quarter was 16.1%, a decline on a copper-adjusted basis of 200 basis points, as compared to the prior year June quarter. The
comparative decline in gross profit and gross profit margin was principally attributable to Superior's Electrical and OEM Groups. Superior's OEM Group gross profit margins were negatively impacted in
the June 2001 quarter by moderate price pressure due to overall lower demand levels while Superior's Electrical Group gross profit margin was comparatively lower due to depressed industry
pricing levels, which, as indicated above, impacted sales and gross profit by approximately $6 million in the June 2001 quarter. Partially offsetting the gross profit margin declines in
Superior's Electrical and OEM Groups was a gross profit margin expansion in Superior's Communications Group in the June 2001 quarter reflecting improving margins for fiber optic cable as well
as the benefit of product mix and other cost reductions.

For
the six month period ended June 30, 2001, gross profit was $156.0 million, a decline of 15% as compared to the prior year six month period. The comparative reduction
in gross profit was principally the result of lower sales and lower gross profit margins in Superior's Electrical Group and Superior's

16

---

OEM Group associated with the aforementioned pricing pressures and the impact of the weak industrial sector economic conditions.

Selling,
general and administrative expense ("SG&A expense") for the three and six month periods ended June 30, 2001 was $41.3 million and $80.9 million,
respectively, as compared to SG&A expense of $41.4 million and $81.7 million, respectively, for the three and six months ended June 30, 2000. Superior's operations reflected a
comparative increase in SG&A expense of $1.4 million and $3.2 million for the three and six months ended June 30, 2001, respectively, with such increases reflecting higher selling
and marketing expenses to support the product development and sales growth of Superior's Communications Group fiber optic cable product line. Superior's increased SG&A expense was offset by a
$1.5 million and $4.0 million reduction in Alpine corporate administrative expenses for the three and six month periods ended June 30, 2001, respectively, resulting from a recent
administrative reorganization and cost reduction initiative.

The
Company incurred infrequent and unusual charges of $5.6 million and $6.4 million for the three and six month periods ended June 30, 2001, respectively.
Superior incurred infrequent and unusual charges of $0.2 million and $1.0 million for the three and six month periods ended June 30, 2001, respectively, related to restructuring
activities in Superior Israel's operations. Alpine incurred infrequent and unusual charges of $5.4 million during the three months ended June 30, 2001 related principally to the
recognition of certain unfunded prior year retirement plan obligations upon termination of benefits for certain employees involved in the recent administrative reorganization. For the three and six
month periods ended June 30, 2000, Superior incurred infrequent and unusual charges of $3.0 million and $8.8 million, respectively, which were primarily associated with the
rationalization of certain Essex manufacturing facilities.

Operating
income for the June 30, 2001 quarter was $26.3 million. Before infrequent and unusual charges and goodwill amortization, operating income was
$37.2 million, a decline of $20.1 million as compared to the June 30, 2000 quarter. For the six month period ended June 30, 2001, operating income before infrequent and
unusual charges and goodwill amortization was $75.1 million, a decline of $27.5 million as compared to the six month period ended June 30, 2000. The comparative decline in
operating income for the current year three and six month periods was principally attributable to lower sales, gross margins, and operating income in Superior's Electrical and OEM Groups.

Interest
expense for the three and six month periods ended June 30, 2001 was $31.8 million and $65.6 million, respectively, representing a decrease of
$3.0 million and $2.5 million, respectively, over the prior year three and six month periods. The decrease in interest expense reflects lower short-term (LIBOR) interest
rates as a result of recent Federal Reserve interest rate cuts. Based on current short-term interest rates, the Company anticipates additional interest expense reductions on a sequential
period and year-over-year basis in the third quarter of 2001.

For
the three and six month periods ended June 30, 2001, other income was $2.8 million and $3.7 million, respectively, including $1.2 million in dividend
income from the Company's common equity investment in Cookson. Other expense amounted to $1.1 million for the three month period ended June 30, 2000, with such expense being primarily
due to currency translation losses at Superior Israel on certain debt linked to non-functional currencies (principally Euro-linked). For the six month period ended
June 30, 2000, other income was $3.1 million including $2.7 million in dividend income from the Company's common equity investment in Cookson.

For
the three and six month periods ended June 30, 2001, the Company recorded minority interest in net losses of subsidiary of $1.4 million and $3.7 million,
respectively, reflecting the minority common equity interest in the losses incurred by Superior and Superior Israel. For the three and six month periods ended June 30, 2000, the Company
recorded minority interest in earnings of subsidiary of $2.1 million and $1.5 million, respectively, reflecting the minority common equity interest in the

17

---

earnings of Superior net of the minority common equity interest in the losses incurred by Superior Israel for such periods.

Equity
in earnings of affiliate represents accrued dividend income earned on Alpine's investment in PolyVision preferred stock and Alpine's proportionate common equity interest in the
net earnings (losses) of PolyVision for the applicable reporting periods. Total equity in earnings recorded from the Company's investment in PolyVision amounted to $1.1 million and
$0.3 million, respectively, for the three and six month periods ended June 30, 2001.

Income
before infrequent and unusual charges and goodwill amortization for the quarter ended June 30, 2001 was $2.7 million or $0.18 per diluted share as compared to
$6.6 million or $0.44 per diluted share for the quarter ended June 30, 2001. For the six month period ended June 30, 2001, income before infrequent and unusual charges and
goodwill amortization was $2.4 million or $0.16 per diluted share as compared to $11.4 million or $0.74 per diluted share for the June 30, 2000 six month period. The reduction in
pro forma earnings in the current period was principally due to lower operating income in Superior's Electrical and OEM Groups, and the impact of the loss on sale of securities in the March 31,
2001 quarter, partially offset by lower interest rates.

Liquidity and Capital Resources

General

For the six months ended June 30, 2001, the Company generated $9.9 million in cash flows from operating activities. Cash flows provided by
operating activities consisted of $24.6 million provided by operating cash flow (net loss plus non-cash charges) reduced by $14.7 million in cash flow used for net working
capital changes, including a seasonal inventory increase of $14.6 million. Superior anticipates that inventory levels will be seasonally lower by the end of 2001. Cash used for investing
activities amounted to $2.8 million and consisted principally of $14.3 million of capital expenditures partly offset by $8.1 million in cash proceeds from the sale of
3.0 million Cookson ordinary shares and a $7.7 million reduction in restricted cash. Cash provided by financing activities amounted to $5.9 million which was associated
principally with a $13.0 million increase in cash and cash equivalents.

Superior TeleCom

Superior finances its operating activities (exclusive of operating activities of Superior Israel which are financed under separate, non recourse, financing
arrangements) and other capital requirements from operating cash flow and funding availability under its $1.15 billion amended and restated credit
agreement (the "Credit Agreement") and a $200 million senior subordinated credit agreement (the "Sub Notes"). Obligations under the Credit Agreement are secured by substantially all of the
assets of Superior and its domestic subsidiaries, and by the common stock of its principal foreign subsidiaries. The Credit Agreement contains certain restrictive covenants, including, among other
things, requirements to maintain certain financial ratios (which are discussed more fully below), limitations on the amount of dividends and restrictions on additional indebtedness.

In
addition to financing provided by the credit facilities, Superior has financing availability under a receivable securitization program providing for up to $160.0 million in
short-term financing through the issuance of commercial paper. At June 30, 2001, $160.0 million was outstanding under this program.

On
July 5, 2001, Superior and its lenders executed an amendment to the Credit Agreement (the "Amended Credit Agreement") effective June 30, 2001. The Amended Credit
Agreement provides for, among other things, less stringent financial covenant requirements through June 2002, consistent with management's current forecast of operating results for such period.
Also, pursuant to the Amended Credit Agreement Superior is obligated to make, in addition to scheduled term loan repayments, a $175 million term loan prepayment by July 1, 2002. It is
contemplated that funds for such pre-payment

18

---

would be generated from proceeds of a major asset divestiture or other equity transaction ("Deleveraging Proceeds Transaction") to be completed prior to such date. The Amended Credit Agreement also
requires Superior to execute a definitive agreement related to a Deleveraging Proceeds Transaction by January 31, 2002 or Superior will be required to meet substantially more stringent
financial covenant requirements. If Superior is not able to enter into any such definitive agreement or complete a Deleveraging Proceeds Transaction, it would likely not be able to meet the more
stringent financial covenants or make the mandatory prepayment required under the Amended Credit Agreement. Either of these events would cause Superior to be in default under the Credit Agreement and
would require Superior to seek a waiver under or other modification of the Credit Agreement. However, there can be no assurance that Superior would be able to obtain any such waiver or modification.
Furthermore, if certain other interim deleveraging milestones are not met, the Amended Credit Agreement requires the suspension of cash interest payments on Superior's Sub Notes on November 30,
2001 (which would require Superior to obtain the consent of the Sub Note holders, the failure of which to obtain would result in an event of default under the Sub Notes) and the suspension of dividend
payments on the outstanding Trust Convertible Preferred Securities.

Superior
intends to proceed expeditiously in completing a Deleveraging Proceeds Transaction in order to substantially deleverage its balance sheet, improve its capital structure and
provide the appropriate capital base for the growth of its operations. Superior is currently evaluating its businesses and product lines with respect to such transaction. Although there can be no
certainty, Superior anticipates that such transaction can be completed within the time frame and in an aggregate dollar amount sufficient to comply with all Amended Credit Agreement covenant
requirements. Superior intends to appoint a major global investment banking firm in the near future to assist with this process. In connection with a Deleveraging Proceeds Transaction, any asset that
is determined to be held for sale will be evaluated for impairment in accordance with SFAS No. 121 "Accounting for the Impairment of Long-Lived Assets
and for Long-Lived Assets to Be Disposed Of" with an impairment charge (if any) recorded at such time. At the present time, all of the Company's assets are held for use and no impairment exists.

At
June 30, 2001, Superior had unused and excess borrowing availability under its Credit Agreement of $95 million and cash on hand of $25 million resulting in
total operating funds availability of $120 million which, along with its operating cash flow, is used to service Superior normal operating commitments.

Over
the next twelve month period Superior (excluding its Superior Israel operations) anticipates a reduction in cash flow required to service interest costs and capital expenditure
obligations. Superior is currently benefiting from the substantial reduction in market interest rates that have occurred over the past six months. Cash interest expense, based on current market
interest rates, is expected to approximate $100-$105 million over the next twelve months, a reduction of $15-$20 million from cash interest costs incurred in
2000. Capital expenditures are expected to approximate $25-$30 million over the next twelve month period, a reduction of $33-$38 million from capital expenditures
in 2000. Further, Superior recently announced an indefinite suspension and deferral of dividend payments on the outstanding Trust Convertible Preferred Securities resulting in annualized cash flow
savings of $14 million. Unpaid dividends are cumulative and accrue interest at a rate of 8.50% per annum.

In
the aggregate, Superior believes that it has reduced its annual cash outflow requirement for interest, dividends and capital expenditures by more than $60 million from 2000
levels. Superior further believes its cash and credit availability ($120 million at June 30, 2001), together with internal operating cash flow will be sufficient to service the
anticipated reduced level of commitments as well as meet all ordinary term loan amortization requirements over the next twelve month period. However, a material adverse change in working capital
requirements or a meaningful reduction in anticipated operating results could have adverse consequences with respect to cash flow or with respect to compliance by

19

---

Superior with its financial covenant and other requirements pursuant to the Amended Credit Agreement, which could restrict access to available funds under the Credit Agreement.

Superior
Israel's operations are funded and financed separately, on a non-recourse basis to Superior, and include a $93.0 million credit facility consisting of a $63.0 million
term loan and a $30.0 million revolving credit facility. At June 30, 2001, Superior Israel had $14.6 million in excess availability under its revolving credit facility.

Alpine Corporate

As of June 30, 2001, Alpine had corporate cash, cash equivalents and marketable securities (excluding its investments in Superior, PolyVision and
Cookson) of approximately $10.3 million. Alpine also owns approximately 10.5 million common shares (representing 50.8% common share ownership) of Superior (NYSE:SUT) with a market value
on August 10, 2001 of approximately $      million. Additionally, the estimated fair market value on August 10, 2001 of Alpine's investment in PolyVision common stock (AMEX:
PLI) and preferred stock (including accrued dividends) amounted to approximately $      million.

As
of June 30, 2001, the Company owned 15.3 million shares of Cookson (FTSE: CKSN.L) common stock. During the quarter ended June 30, 2001, the Company entered
into certain forward sale derivative transactions related to 10.5 million shares of Cookson common stock. Under these arrangements, the Company has executed "collar" agreements, protecting the
Company against future declines in Cookson share price while limiting the Company's participation in Cookson share value appreciation beyond certain threshold levels. These arrangements allow
borrowings by the Company against minimum threshold share value levels. Proceeds from such borrowings amounted to approximately $20.7 million at June 30, 2001 and are expected to be
self-liquidating from sale proceeds of the underlying Cookson shares (and proceeds from the derivative instrument, to the extent Cookson share price has declined below threshold levels)
upon expiration of the "collar" agreements in 2003. At June 30, 2001, the Company held 4.9 million Cookson shares not subject to the above "collar" arrangements with a fair market value
as of August 10, 2001 of $      million.

At
June 30, 2001, Alpine had $15.7 million outstanding under a corporate revolving credit facility which matures in October 2001. Alpine intends to reduce its
outstanding borrowings under this facility through application of cash proceeds from a continued liquidation of its remaining Cookson common stock position, with any remaining balance being refinanced
or liquidated through other means.

Alpine
has no other major commitments over the next twelve months other than the aforementioned principal debt service requirements, periodic interest cost and Alpine corporate
overhead expense, which have been substantially reduced over the past six month period. For the next twelve month period, Alpine expects to fund its aforementioned annual commitments from management
fees paid by Superior, cash proceeds from its Cookson investment, interest and dividend income earned and from available cash reserves.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company's exposure to market risk primarily relates to interest rates on long-term debt. There have been no material changes in market risk
since December 31, 2000.

---

Except for the historical information herein, the matters discussed in this Form 10-Q include forward-looking statements that may involve a
number of risks and uncertainties. Actual results may vary significantly based on a number of factors, including, but not limited to, risks in product and technology development, market acceptance of
new products and continuing product demand, prediction and timing of customer orders, the impact of competitive products and pricing, changing economic conditions, including changes in
short-term interest rates and foreign exchange rates, and other risk factors detailed in the Company's most recent filings with the Securities and Exchange
Commission.

20

---



PART II. OTHER INFORMATION

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

10.1*

Amendment dated as of January 1, 2001, to the Services Agreement between The Alpine Group, Inc. and Superior TeleCom Inc.10.2*

Amendment No. 5, dated as of June 30, 2001 to the Amended and Restated Credit Agreement dated as of November 27, 1998, among Superior Telecommunications Inc., Essex Group Inc., the guarantors named therein,
various lenders, Bankers Trust Company, as administrative agent and Fleet National Bank, as syndication agent.




---

21

---



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.

|                      |  | THE ALPINE GROUP, INC.
|--------------------- |  | ----------------------
|Date: August 14, 2001 |  | By:                   

22

---

QuickLinks