---

---

SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

---

FORM 10-Q

(Mark One)

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

For the Quarterly Period Ended September 30, 2001

or

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

For the transition period from  to

Commission file number 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)


212-757-3333Registrant'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 November 2, 2001
|---------------------------- |  | -------------------------------
|Common Stock, $.10 Par Value |  | 13,905,076                     

---

---

---



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)

|                                                                                                                                                                          |                                                                                                                                                                        | September 30,
2001         |                                            | December 31,
2000 |          
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------- | ------------------------------------------ | ----------------- | ---------
|
|ASSETS                                                                                                                                                                    |                                                                                                                                                                        |                            |                                            |                   |          
|Current assets:                                                                                                                                                           |                                                                                                                                                                        |                            |                                            |                   |          
|                                                                                                                                                                          | Cash and cash equivalents                                                                                                                                              |                            | $                                          | 23,169            |          
|                                                                                                                                                                          | Restricted cash                                                                                                                                                        |                            |                                            |                  |          
|                                                                                                                                                                          | Accounts receivable (less allowance for doubtful accounts of $5,579 and $4,998 at September 30, 2001 and December 31, 2000, respectively)                              |                            |                                            | 243,071           |          
|                                                                                                                                                                          | Inventories                                                                                                                                                            |                            |                                            | 270,627           |          
|                                                                                                                                                                          | Other current assets                                                                                                                                                   |                            |                                            | 48,110            |          
|                                                                                                                                                                          |                                                                                                                                                                        |                            |                                            |                   |          
|                                                                                                                                                                          |                                                                                                                                                                        | Total current assets       |                                            |                   | 584,977  
|Property, plant and equipment, net                                                                                                                                        |                                                                                                                                                                        |                            | 520,547                                    |                   |          
|Long-term investments and other assets                                                                                                                                    |                                                                                                                                                                        |                            | 148,909                                    |                   |          
|Goodwill (less accumulated amortization of $65,258 and $49,462 at September 30, 2001 and December 31, 2000, respectively)                                                 |                                                                                                                                                                        |                            | 759,075                                    |                   |          
|                                                                                                                                                                          |                                                                                                                                                                        |                            |                                            |                   |          
|                                                                                                                                                                          |                                                                                                                                                                        | Total assets               |                                            | $                 | 2,013,508
|                                                                                                                                                                          |                                                                                                                                                                        |                            |                                            |                   |          
|LIABILITIES AND STOCKHOLDERS' EQUITY                                                                                                                                      |                                                                                                                                                                        |                            |                                            |                   |          
|Current liabilities:                                                                                                                                                      |                                                                                                                                                                        |                            |                                            |                   |          
|                                                                                                                                                                          | Short-term borrowings                                                                                                                                                  |                            | $                                          | 144,149           |          
|                                                                                                                                                                          | Current portion of long-term debt                                                                                                                                      |                            |                                            | 301,398           |          
|                                                                                                                                                                          | Accounts payable                                                                                                                                                       |                            |                                            | 135,013           |          
|                                                                                                                                                                          | Accrued expenses                                                                                                                                                       |                            |                                            | 88,337            |          
|                                                                                                                                                                          |                                                                                                                                                                        |                            |                                            |                   |          
|                                                                                                                                                                          |                                                                                                                                                                        | Total current liabilities  |                                            |                   | 668,897  
|Long-term debt, less current portion                                                                                                                                      |                                                                                                                                                                        |                            | 971,313                                    |                   |          
|Minority interest in subsidiaries                                                                                                                                         |                                                                                                                                                                        |                            | 55,694                                     |                   |          
|Other long-term liabilities                                                                                                                                               |                                                                                                                                                                        |                            | 134,526                                    |                   |          
|                                                                                                                                                                          |                                                                                                                                                                        |                            |                                            |                   |          
|                                                                                                                                                                          |                                                                                                                                                                        | Total liabilities          |                                            |                   | 1,830,430
|                                                                                                                                                                          |                                                                                                                                                                        |                            |                                            |                   |          
|Subsidiary-obligated Mandatorily Redeemable Trust Convertible Preferred Securities of Superior Trust I holding solely convertible debentures of Superior, net of discount |                                                                                                                                                                        |                            | 135,753                                    |                   |          
|Commitments and contingencies                                                                                                                                             |                                                                                                                                                                        |                            |                                            |                   |          
|Stockholders' equity:                                                                                                                                                     |                                                                                                                                                                        |                            |                                            |                   |          
|                                                                                                                                                                          | 9% cumulative convertible preferred stock at liquidation value                                                                                                         |                            |                                            | 427               |          
|                                                                                                                                                                          | Common stock, $.10 par value; 25,000,000 shares authorized; (21,887,685 shares and 21,763,055 shares issued at September 30, 2001 and December 31, 2000, respectively) |                            |                                            | 2,189             |          
|                                                                                                                                                                          | Capital in excess of par value                                                                                                                                         |                            |                                            | 162,208           |          
|                                                                                                                                                                          | Accumulated other comprehensive deficit                                                                                                                                |                            |                                            | (24,384           | )        
|                                                                                                                                                                          | Retained earnings                                                                                                                                                      |                            |                                            | 3,385             |          
|                                                                                                                                                                          |                                                                                                                                                                        |                            |                                            |                   |          
|                                                                                                                                                                          |                                                                                                                                                                        |                            | 143,825                                    |                   |          
|                                                                                                                                                                          | Treasury stock, at cost (8,018,495 shares and 8,050,646 shares at September 30, 2001 and December 31, 2000, respectively)                                              |                            |                                            | (95,592           | )        
|                                                                                                                                                                          | Receivable from stockholders                                                                                                                                           |                            |                                            | (908              | )        
|                                                                                                                                                                          |                                                                                                                                                                        |                            |                                            |                   |          
|                                                                                                                                                                          |                                                                                                                                                                        | Total stockholders' equity |                                            |                   | 47,325   
|                                                                                                                                                                          |                                                                                                                                                                        |                            |                                            |                   |          
|                                                                                                                                                                          |                                                                                                                                                                        |                            | 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
September 30, |        
|--------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------ | -------------------------------- | -------
|
|Net sales                                                 |                                                                                                                                            | $                                | 420,306
|Cost of goods sold                                        |                                                                                                                                            |                                  | 350,129
|                                                          |                                                                                                                                            |                                  |        
|                                                          | Gross profit                                                                                                                               |                                  |        
|Selling, general and administrative expenses              |                                                                                                                                            |                                  | 36,757 
|Amortization of goodwill                                  |                                                                                                                                            |                                  | 5,290  
|Infrequent and unusual charges                            |                                                                                                                                            |                                  |       
|                                                          |                                                                                                                                            |                                  |        
|                                                          | Operating income                                                                                                                           |                                  |        
|Interest expense                                          |                                                                                                                                            |                                  | (28,874
|Loss on sale of securities                                |                                                                                                                                            |                                  | (1,897 
|Other income (expense), net                               |                                                                                                                                            |                                  | (496   
|                                                          |                                                                                                                                            |                                  |        
|                                                          | Loss before income taxes, distributions on preferred securities of subsidiary trust, minority interest and equity in earnings of affiliate |                                  |        
|Benefit for income taxes                                  |                                                                                                                                            |                                  | 365    
|                                                          |                                                                                                                                            |                                  |        
|                                                          | Loss before distributions on preferred securities of subsidiary trust, minority interest and equity in earnings of affiliate               |                                  |        
|Distributions on preferred securities of subsidiary trust |                                                                                                                                            |                                  | (3,819 
|                                                          |                                                                                                                                            |                                  |        
|                                                          | Loss before minority interest and equity in earnings of affiliate                                                                          |                                  |        
|Minority interest in losses of subsidiaries               |                                                                                                                                            |                                  | 2,269  
|Equity in earnings of affiliate                           |                                                                                                                                            |                                  | 1,869  
|                                                          |                                                                                                                                            |                                  |        
|                                                          | Net loss                                                                                                                                   |                                  |        
|Preferred stock dividends                                 |                                                                                                                                            |                                  | (9     
|                                                          |                                                                                                                                            |                                  |        
|                                                          | Net loss applicable to common stock                                                                                                        |                                  | $      
|                                                          |                                                                                                                                            |                                  |        
|Net 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)

|                                                          |                                                                                                                                                     | Nine Months Ended
September 30, |          
|--------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------- | ---------
|
|Net sales                                                 |                                                                                                                                                     | $                               | 1,385,469
|Cost of goods sold                                        |                                                                                                                                                     |                                 | 1,159,245
|                                                          |                                                                                                                                                     |                                 |          
|                                                          | Gross profit                                                                                                                                        |                                 |          
|Selling, general and administrative expenses              |                                                                                                                                                     |                                 | 117,677  
|Amortization of goodwill                                  |                                                                                                                                                     |                                 | 15,873   
|Infrequent and unusual charges                            |                                                                                                                                                     |                                 | 6,416    
|                                                          |                                                                                                                                                     |                                 |          
|                                                          | Operating income                                                                                                                                    |                                 |          
|Interest expense                                          |                                                                                                                                                     |                                 | (94,453  
|Loss on sale of securities                                |                                                                                                                                                     |                                 | (5,239   
|Other income, net                                         |                                                                                                                                                     |                                 | 3,171    
|                                                          |                                                                                                                                                     |                                 |          
|                                                          | 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                      |                                                                                                                                                     |                                 | 1,501    
|                                                          |                                                                                                                                                     |                                 |          
|                                                          | 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 |                                                                                                                                                     |                                 | (11,434  
|                                                          |                                                                                                                                                     |                                 |          
|                                                          | Loss before minority interest and equity in earnings of affiliate                                                                                   |                                 |          
|Minority interest in losses of subsidiaries               |                                                                                                                                                     |                                 | 6,014    
|Equity in earnings of affiliate                           |                                                                                                                                                     |                                 | 2,155    
|                                                          |                                                                                                                                                     |                                 |          
|                                                          | Net loss                                                                                                                                            |                                 |          
|Preferred stock dividends                                 |                                                                                                                                                     |                                 | (28      
|                                                          |                                                                                                                                                     |                                 |          
|                                                          | Net loss applicable to common stock                                                                                                                 |                                 | $        
|                                                          |                                                                                                                                                     |                                 |          
|Net 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)

|                                           |                                                       | Nine Months Ended
September 30, 2001 |           
|------------------------------------------ | ----------------------------------------------------- | ------------------------------------ | ----------
|
|9% cumulative convertible preferred stock: |                                                       |                                      |           
|                                           | Balance at beginning of period                        |                                      | 427       
|                                           |                                                       |                                      |           
|                                           |                                                       | Balance at end of period             |           
|                                           |                                                       |                                      |           
|Common stock:                              |                                                       |                                      |           
|                                           | Balance at beginning of period                        |                                      | 21,763,055
|                                           | Employee stock purchase plan                          |                                      | 118,271   
|                                           | Stock grants                                          |                                      | 6,359     
|                                           |                                                       |                                      |           
|                                           |                                                       | 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               |                                      |           
|                                           | Change in 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                            |                                      | (87,650   
|                                           | 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)

|                                      |                                                      | Nine Months Ended
September 30,                                                 |                                                                            
|------------------------------------- | ---------------------------------------------------- | ------------------------------------------------------------------------------- | ---------------------------------------------------------------------------
|
|Cash flows from operating activities: |                                                      |                                                                                 |                                                                            
|                                      | Net loss                                             |                                                                                 | $                                                                          
|                                      |                                                      | Adjustments to reconcile net 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                   
|                                      |                                                      |                                                                                 | Loss on sale of securities                                                 
|                                      |                                                      |                                                                                 | Provision (benefit) for deferred income taxes                              
|                                      |                                                      |                                                                                 | Minority interest in losses of subsidiary                                  
|                                      |                                                      |                                                                                 | Equity in earnings of affiliates                                           
|                                      |                                                      |                                                                                 | Change in assets and liabilities:                                          
|                                      |                                                      |                                                                                 |                                                                            
|                                      |                                                      |                                                                                 |                                                                            
|                                      |                                                      |                                                                                 |                                                                            
|                                      |                                                      |                                                                                 |                                                                            
|                                      |                                                      |                                                                                 |                                                                            
|                                      |                                                      |                                                                                 |                                                                            
|                                      | Cash flows provided by operating activities          |                                                                                 |                                                                            
|                                      |                                                      |                                                                                 |                                                                            
|                                      | 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             |                                                                                 |                                                                            
|                                      |                                                      |                                                                                 |                                                                            
|                                      | Cash flows from financing activities:                |                                                                                 |                                                                            
|                                      |                                                      | Borrowings under revolving credit facilities, net                               |                                                                            
|                                      |                                                      | Short-term borrowings (repayments), net                                         |                                                                            
|                                      |                                                      | Repayments of long-term borrowings                                              |                                                                            
|                                      |                                                      | Long-term borrowings                                                            |                                                                            
|                                      |                                                      | Purchase of treasury shares                                                     |                                                                            
|                                      |                                                      | Other                                                                           |                                                                            
|                                      |                                                      |                                                                                 |                                                                            
|                                      | Cash flows used for financing activities             |                                                                                 |                                                                            
|                                      |                                                      |                                                                                 |                                                                            
|                                      | Net increase (decrease) in cash and cash equivalents |                                                                                 |                                                                            
|                                      | Cash and cash equivalents at beginning of period     |                                                                                 |                                                                            
|                                      |                                                      |                                                                                 |                                                                            
|                                      | Cash and cash equivalents at end of period           |                                                                                 |                                                                            
|                                      |                                                      |                                                                                 |                                                                            
|                                      | 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

SEPTEMBER 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 50.5% owned subsidiary,
which manufactures wire and cable products for the communications, original equipment manufacturer ("OEM") and electrical markets.

As
of September 30, 2001, Alpine also holds a 48% common equity interest and $19.8 million of convertible preferred stock in PolyVision Corporation ("PolyVision"), a
global manufacturer of visual communications and related products. Alpine currently accounts for its investment in PolyVision under the equity method of accounting. As described in Note 9,
Alpine's common and preferred equity interests were acquired by Steelcase Inc. pursuant to a merger of PolyVision and a wholly-owned subsidiary of Steelcase Inc., completed on
November 14, 2001.

In
July 2001, the Financial Accounting Standards Board ("FASB") 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 intangibles 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; however, goodwill will be subject to impairment reviews beginning in the first quarter of 2002, which may result in future periodic write-downs. Management is in the process of evaluating
what impact the initial impairment assessments may have on the Company's financial statements.

In
July 2001, the FASB also issued SFAS No. 143, "Accounting for Asset Retirement Obligations". SFAS No. 143 requires entities to record the fair value of a
liability for an asset retirement obligation in the period in which it is incurred. When the liability is initially recorded, the entity capitalizes the cost by increasing the carrying amount of the
related long-lived asset. Over time, the liability is accreted to its present value each period and the capitalized cost is depreciated over the useful life of the related
asset. Upon settlement of the liability, the entity either settles the obligation for the amount recorded or incurs a gain or loss. SFAS No. 143 is effective for fiscal years beginning after
June 15, 2002. Management is evaluating the effect of this statement on the Company's results of operations and financial position.

In
August 2001, the FASB issued Statement No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets". SFAS No. 144 supersedes FASB
Statement No. 121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of" and the accounting and reporting provisions of APB
Opinion No. 30, "Reporting the Results of OperationsReporting the Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual and Infrequently Occurring Events and
Transactions" for the disposal of a segment of a business (as previously defined in APB Opinion 30). The FASB issued SFAS No. 144 to establish a single accounting model, based on the

8

---

framework established in SFAS No. 121 for long-lived assets to be disposed of by sale. SFAS No. 144 broadens the presentation of discontinued operations in the income
statement to include a component of an entity (rather than a segment of a business). A component of an entity comprises operations and cash flows that can be clearly distinguished, operationally and
for financial reporting purposes, from the rest of the entity. SFAS No. 144 also requires that discontinued operations be measured at the lower of the carrying amount or fair market value less
cost to sell. SFAS No. 144 is effective for fiscal years beginning after December 15, 2001 and should be applied prospectively. Management is evaluating the effect of this statement on
the Company's results of operations and financial position.



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.

During
the nine months ended September 30, 2001, the Company entered into certain forward sale derivative transactions related to 10.5 million ordinary shares of
Cookson. 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 September 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.

Superior
has entered into certain commodity contracts to hedge future sale commitments and excess inventory layers that are anticipated to be liquidated before year end which are
designated as fair value LIFO 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. 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.

9

---

On July 1, 2001, Superior removed the hedge designation for certain LIFO inventory hedge contracts and settled such contracts in September. As a result, Superior recorded a
$0.5 million gain related to changes in the fair market value of these contracts subsequent to July 1, 2001. The net impact of hedge ineffectiveness for the three and nine months ended
September 30, 2001 was immaterial.

Superior
uses foreign currency forward contracts to hedge receivables and payables on Superior's balance sheet that are denominated in foreign currencies other than the functional
currency. These derivatives are considered non-designated derivatives.

2.  Inventories

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

September 30,
2001

December 31,
2000(in thousands)Raw materials

$
30,309

$
45,793Work in process


38,344


42,006Finished goods


198,544


190,782267,197


278,581LIFO reserve


3,430


(16,722
)$
270,627

$
261,859


Inventories
valued using the LIFO method amounted to $145.0 million and $133.6 million at September 30, 2001 and December 31, 2000, respectively.

3.  Comprehensive loss

The components of comprehensive loss for the three and nine months ended September 30, 2001 and 2000 were as follows:

Three Months Ended
September 30,

Nine Months Ended
September 30,2001

2000

2001

2000(in thousands)Net loss

$
(2,453
)
$
(3,031
)
$
(12,027
)
$
(347
)Foreign currency translation adjustment


(955
)

(1,335
)

(1,088
)

(1,762
)Change in unrealized gains on derivatives, net of tax


7,666





9,069


Realized losses on securities, net of tax


1,054


963


3,143


963Change in unrealized losses on securities, net of tax


(9,385
)

(8,615
)

(16,598
)

(22,078
)Comprehensive loss

$
(4,073
)
$
(12,018
)
$
(17,501
)
$
(23,224
)


10

---

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 September 30, 2001,
$17.7 million, $11.6 million, $3.0 million and $2.7 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 September 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 nine months ended September 30, 2001, Superior Israel recorded a $1.0 million restructuring charge for additional 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 the Superior's
$1.15 billion Amended and Restated Credit Agreement (the "Credit Agreement") and a $200 million senior subordinated credit agreement (the "Sub Notes"). 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 included, among other things,
revised financial covenant requirements through June 2002. The Amended Credit Agreement required Superior to make, in addition to scheduled term loan repayments, a $175 million term loan
prepayment by July 1, 2002 from proceeds of a major asset
divestiture or other equity transaction ("Deleveraging Proceeds Transaction"). The Amended Credit Agreement further required Superior by January 31, 2002 to either (i) have executed a
definitive agreement related to a Deleveraging Proceeds Transaction, or (ii) meet substantially more stringent

11

---

financial covenant requirements which would likely result in Superior being in default at such time, requiring Superior to seek a waiver or other modification. However, there can be no assurance that
Superior would be able to obtain any such waiver or modification. If certain other interim deleveraging milestones were not met (which included obtaining a letter of intent by November 15, 2001
for a Deleveraging Proceeds Transaction), the Amended Credit Agreement required the suspension of cash interest payments on the Sub Notes on November 30, 2001 (which would necessitate obtaining
consent from the Sub Notes holders).

Upon
entering into the Amended Credit Agreement, Superior initiated a process involving a Deleveraging Proceeds Transaction which was anticipated to generate proceeds significantly
greater than required under the Amended Credit Agreement. While such process is currently proceeding, the events of September 11th and the adverse impact on financial markets and
valuation levels has caused Superior to consider delaying a Deleveraging Proceeds Transaction until business and financial conditions improve.

Accordingly,
Superior has commenced discussions with its principal lenders seeking to further amend the Amended Credit Agreement to provide for, among other things, (i) an
extension of certain milestone dates related to the Deleveraging Proceeds Transaction until the latter stages of 2002 or early 2003, including the required date for the $175 million term loan
prepayment and the required date for executing a definitive agreement for a Deleveraging Proceeds Transaction, (ii) modified financial covenant performance requirements through the year ended
2002 and (iii) provisions regarding payment of interest on the Sub Notes. While no assurance can be given, Superior believes it will be successful in obtaining such amendments to the Amended
Credit Agreement in the near future.

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.

Alpine
has a corporate credit facility with an outstanding balance of $13.8 million at September 30, 2001 and which matures on November 15, 2001. The Company
expects to liquidate such debt from proceeds of the sale of its equity holdings in PolyVision (see Note 9).

12

---

6.  Earnings per share

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

|                                                                            |  | Three Months Ended September 30, |       
|--------------------------------------------------------------------------- |  | -------------------------------- | ------
|
|
|
|Net loss                                                                    |  | $                                | (2,453
|Less: preferred stock dividends                                             |  |                                  | (9    
|                                                                            |  |                                  |       
|Basic loss per common share                                                 |  |                                  | (2,462
|                                                                            |  |                                  |       
|Dilution in subsidiary and affiliate earnings from common stock equivalents |  |                                  | (40   
|                                                                            |  |                                  |       
|Diluted loss per common share                                               |  | $                                | (2,502
|                                                                            |  |                                  |       

|                                                                            |  | Nine Months Ended September 30, |        
|--------------------------------------------------------------------------- |  | ------------------------------- | -------
|
|
|
|Net loss                                                                    |  | $                               | (12,027
|Less: preferred stock dividends                                             |  |                                 | (28    
|                                                                            |  |                                 |        
|Basic loss per common share                                                 |  |                                 | (12,055
|                                                                            |  |                                 |        
|Dilution in subsidiary and affiliate earnings from common stock equivalents |  |                                 | (97    
|                                                                            |  |                                 |        
|Diluted loss per common share                                               |  | $                               | (12,152
|                                                                            |  |                                 |        

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 $6.4 million during the nine months ended September 30, 2001. Superior incurred infrequent
and unusual charges of $1.0 million during the nine months ended September 30, 2001, related to restructuring activities at Superior Israel. Alpine incurred infrequent and unusual
charges of $5.4 million during the nine months ended September 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 nine months ended September 30, 2000, Superior incurred infrequent and unusual charges of $3.9 million and $12.7 million,
respectively, primarily associated with the rationalization of certain Essex manufacturing

13

---

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 and (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. 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.

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
September 30,

Nine Months Ended
September 30,2001

2000

2001

2000(in thousands)Net sales:Communications

$
172,051

$
215,794

$
594,027

$
641,849OEM


129,009


151,445


419,393


472,300Electrical


119,246


139,984


372,049


441,056$
420,306

$
507,223

$
1,385,469

$
1,555,205Operating income (loss):Communications

$
25,718

$
29,158

$
91,419

$
95,128OEM


12,656


16,899


41,459


59,137Electrical


979


(326
)

(4,917
)

7,816Corporate and other


(5,933
)

(6,339
)

(19,414
)

(20,111
)Amortization of goodwill


(5,290
)

(5,293
)

(15,873
)

(15,774
)Infrequent and unusual charges





(3,915
)

(6,416
)

(12,727
)$
28,130

$
30,184

$
86,258

$
113,469


14

---

September 30,
2001

December 31,
2000Total assets:Communications

$
523,384

$
544,561OEM


304,752


302,690Electrical


272,463


271,831Corporate and other (including goodwill)


912,909


974,664$
2,013,508

$
2,093,746


9.  Subsequent event

On November 13, 2001, PolyVision shareholders approved the merger of PolyVision and a wholly-owned subsidiary of Steelcase Inc. Pursuant to the
merger, on November 14, 2001, Steelcase acquired for cash all of PolyVision's outstanding common stock, including Alpine's 48% ownership position in PolyVision common stock as well as
PolyVision's Series B and Series C convertible preferred stock which is 100%
owned by Alpine. Alpine received approximately $42 million in cash for its holdings in PolyVision and will recognize a pre-tax gain of approximately $6 to $8 million in the
quarter ending December 31, 2001.

15

---



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 50.5% 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

As of September 30, 2001, 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 statement of operations. As described in Note 9, all of Alpine's common and preferred equity interest in PolyVision were acquired by
Steelcase Inc. pursuant to a merger of PolyVision and a wholly-owned subsidiary of Steelcase completed on November 14, 2001.

Cookson Group plc

Alpine also holds an ordinary share investment in Cookson Group plc ("Cookson") of less than 2%, 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.

16

---

Results of OperationsThree and Nine Month Periods Ended September 30, 2001 as Compared to the Three and Nine Month Periods Ended September 30, 2000

Consolidated
sales for the quarter ended September 30, 2001 were $420.3 million, a decrease of 17% as compared to sales of $507.2 million for the quarter ended
September 30, 2000. Adjusted for a constant cost of copper, the sales decline in the September 2001 quarter as compared to the September 2000 quarter was approximately 12%.

Superior's
Communications Group sales for the September 30, 2001 quarter were $172.1 million, a decrease of 19% on a copper-adjusted basis from the September 30,
2000 quarter. The sales decline in the current quarter as compared to the prior year period was due primarily to a 14% 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 significantly reduced spending levels by major telephone company
customers following recently imposed budgetary constraints for the balance of 2001. Also contributing to the comparative sales decline were lower sales of fiber optic cable in the September 30,
2001 quarter which decreased 55% over the prior year period.

Superior's
OEM Group sales were $129.0 million for the quarter ended September 30, 2001, reflecting a copper-adjusted decline of 11% as compared to the
September 30, 2000 quarter. The current quarter comparative sales decline reflected continued soft demand for magnet wire from Superior's major OEM customers due principally to general
industrial sector weakness (particularly in the automotive, power distribution and generation, and industrial equipment sectors) which has existed since the third quarter of 2000 and which was further
impacted by the events of September 11th.

Superior's
Electrical Group sales were $119.2 million for the September 30, 2001 quarter representing a decline of 2% on a copper-adjusted basis as compared to the
quarter ended September 30, 2000. The comparative sales decline was due principally to weaker industry-wide demand levels as a result of overall economic conditions.

Consolidated
sales for the nine month period ended September 30, 2001 were $1.385 billion, a copper-adjusted decrease of 9% as compared to the nine month period ended
September 30, 2000. The comparative reduction in sales for the 2001 nine month period was due primarily to comparative declines of 11% and 10% in Superior's Electrical Group and OEM Group
sales, respectively and was attributable to previously mentioned general economic conditions.

Gross
profit for the September 30, 2001 quarter was $70.2 million, a decline of $10.1 million as compared to gross profit of $80.3 million for the quarter
ended September 30, 2000. The gross profit margin in the September 2001 quarter was 16.7%, a decline on a copper-adjusted basis of 20 basis points, as compared to the prior year
September quarter. The comparative decline in gross profit and gross profit margin was principally attributable to Superior's OEM Group where gross profit margins have been negatively impacted during
2001 by moderate price pressure due to overall lower demand levels. Partially offsetting the gross profit margin decline in Superior's OEM Group was improved comparative gross profit margins during
the three month period ended September 30, 2001 in Superior's Electrical Group and Communications Group, due principally to productivity gains.

For
the nine month period ended September 30, 2001, gross profit was $226.2 million, a decline of 15% as compared to the prior year nine 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 OEM Group associated with industry pricing conditions and the
impact of the weak industrial sector economic conditions.

Selling,
general and administrative expense ("SG&A expense") for the three and nine month periods ended September 30, 2001 was $36.8 million and $117.7 million,
respectively, as compared to

17

---

SG&A expense of $40.9 million and $122.7 million, respectively, for the three and nine months ended September 30, 2000. Superior's operations reflected a comparative decrease in
SG&A expense of $2.3 million for the three months ended September 30, 2001 and a comparative increase in SG&A expense of $0.9 million for the nine months ended
September 30, 2001, with such increase reflecting higher selling and marketing expenses to support the product development and sales growth of Superior's Communications Group fiber optic cable
product line. Alpine's operations reflected a $1.9 million and $5.9 million reduction in corporate administrative expenses for the three and nine month periods ended September 30,
2001, respectively, resulting from recent administrative reorganization and cost reduction initiatives.

The
Company incurred infrequent and unusual charges of $6.4 million for the nine month period ended September 30, 2001. Superior incurred infrequent and unusual charges
of $1.0 million for the nine month period ended September 30, 2001 related to restructuring activities in Superior Israel's operations. Alpine incurred infrequent and unusual charges of
$5.4 million during the nine months ended September 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 nine month periods ended September 30, 2000, Superior incurred infrequent and unusual
charges of $3.9 million and $12.7 million, respectively, which were primarily associated with the rationalization of certain Essex manufacturing facilities.

Operating
income for the September 30, 2001 quarter was $28.1 million. Before infrequent and unusual charges and goodwill amortization, operating income was
$33.4 million, a decline of $6.0 million as compared to the September 30, 2000 quarter. For the nine month period ended September 30, 2001, operating income before
infrequent and unusual charges and goodwill amortization was $108.5 million, a decline of $33.4 million as compared to the nine month period ended September 30, 2000. The
comparative decline in operating income for the current year three month period was principally attributable to lower sales in Superior's Communications Group in the September 2001 quarter and
lower sales and gross margins in Superior's OEM Group. Partially offsetting the comparative decline in operating income in Superior's Communications and OEM Groups for the September 2001
quarter was a comparative improvement in operating income in Superior's Electrical Group which was attributable to productivity gains and was achieved despite lower volume and lower pricing levels as
compared to the prior year comparative three month period.

Interest
expense for the three and nine month periods ended September 30, 2001 was $28.9 million and $94.5 million, respectively, representing a decrease of
$5.7 million and $8.2 million, respectively, over the prior year three and nine month periods. The decrease in interest expense reflects lower short-term (LIBOR) interest
rates as a result of recent Federal Reserve interest rate cuts as well as lower Alpine corporate debt levels.

For
the three month period ended September 30, 2001, other expense was $0.5 million which primarily included currency translation losses partially offset by
$0.9 million in dividend income from the Company's common equity investment in Cookson. Other income amounted to $2.3 million for the three month period ended September 30, 2000,
with such income being primarily due to currency translation gains at Superior Israel on certain debt linked to non-functional currencies (principally Euro-linked) as well as
gains on sale of certain fixed assets and investments. For the nine month periods ended September 30, 2001 and 2000, other income was $3.2 million and $5.5 million, respectively,
including among other items, investment income earned on certain managed fund accounts and dividend income from the Company's common equity investment in Cookson.

For
the three and nine month periods ended September 30, 2001, the Company recorded minority interest in net losses of subsidiary of $2.3 million and
$6.0 million, respectively, reflecting the minority common equity interest in the losses incurred by Superior and its 50% owned subsidiary, Superior Israel. For the three and nine month periods
ended September 30, 2000, the Company recorded

18

---

minority interest in losses of subsidiary of $2.0 million and $0.5 million, respectively, reflecting the minority common equity interest in the losses of Superior Israel for the three
and nine month periods net of the minority common equity interest in the earnings of Superior 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 $1.9 million and
$2.2 million, respectively, for the three and nine month periods ended September 30, 2001.

Income
before infrequent and unusual charges and goodwill amortization for the quarter ended September 30, 2001 was $1.7 million or $0.11 per diluted share as compared
to $1.8 million or $0.13 per diluted share for the quarter ended September 30, 2000. For the nine month period ended September 30, 2001, income before infrequent and unusual
charges and goodwill amortization was $4.1 million or $0.27 per diluted share as compared to $13.2 million or $0.87 per diluted share for the September 30, 2000 nine month period.
The reduction in pro forma earnings in the current period was principally due to lower operating income partially offset by lower interest rates.

Liquidity and Capital Resources

General

For the nine months ended September 30, 2001, the Company generated $33.3 million in cash flows from operating activities. Cash flows provided by
operating activities consisted of $33.0 million provided by operating cash flow (net loss plus non-cash items) and $0.3 million in cash flow provided by net working capital
changes. Cash used for investing activities amounted to $13.8 million and consisted principally of $22.4 million of capital expenditures at Superior partly offset by $10.0 million
in cash proceeds from the sale of a portion of Alpine's Cookson ordinary shares and a $7.7 million reduction in restricted cash. Cash used for financing activities which principally related to
net reductions in debt, amounted to $18.8 million.

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 a majority of 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 Superior's credit facilities, Superior has financing availability under a receivable securitization program providing for up to
$160.0 million (based on the level of accounts receivables) in short-term financing through the issuance of commercial paper. At September 30, 2001, $144.1 million was
outstanding under this program which, based on the current level of accounts receivable, was fully drawn. This program, which is periodically renewable, expires on June 30, 2002, at which time
Superior anticipates it will obtain an applicable renewal.

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 included, among other things, revised financial covenant requirements through June 2002. The Amended Credit Agreement required Superior to make, in addition to scheduled term loan
repayments, a $175 million

19

---

term loan prepayment by July 1, 2002 from proceeds of a major asset divestiture or other equity transaction ("Deleveraging Proceeds Transaction"). The Amended Credit Agreement further required
Superior by January 31, 2002 to either (i) have executed a definitive agreement related to a Deleveraging
Proceeds Transaction, or (ii) meet substantially more stringent financial covenant requirements which would likely result in Superior being in default at such time, requiring Superior to seek a
waiver or other modification. However, there can be no assurance that Superior would be able to obtain any such waiver or modification. If certain other interim deleveraging milestones were not met,
the Amended Credit Agreement also required the suspension of cash interest payments on the Sub Notes on November 30, 2001 (which suspension would necessitate obtaining consent from the Sub
Notes holders).

Upon
entering into the Amended Credit Agreement, Superior initiated a process involving a Deleveraging Proceeds Transaction which was anticipated to generate proceeds significantly
greater than required under the Amended Credit Agreement. While such process is currently proceeding, the events of September 11th and the adverse impact on financial markets and
valuation levels has caused Superior to consider delaying a Deleveraging Proceeds Transaction until business and financial conditions improve.

Accordingly,
Superior has commenced discussions with its lenders seeking to further amend the Amended Credit Agreement to provide for, among other things, (i) an extension of
certain milestone dates related to completion of a Deleveraging Proceeds Transaction until the latter stages of 2002 or early 2003, including the required date for the $175 million term loan
prepayment and the required date for executing a definitive agreement for a Deleveraging Proceeds Transaction, (ii) modified financial covenant performance requirements through the year ended
2002 and (iii) provision regarding payment of interest on the Sub Notes. While no assurance can be given, Superior believes it will be successful in obtaining such amendments to the Credit
Agreement in the near future and that Superior will be able to successfully complete a Deleveraging Proceeds Transaction within the revised time frame.

At
September 30, 2001 Superior had unused and excess borrowing availability under the Amended Credit Agreement of $88 million and cash on hand of $14 million
resulting in total operating funds availability of $102 million which, along with its operating cash flow, is used to service Superior's normal operating commitments.

Over
the next twelve month period Superior (excluding its Superior Israel operations) anticipates a substantial 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 nine months. Cash interest expense, based on current
market interest rates, is expected to approximate $80-$85 million over the next twelve months, a reduction of $35-$40 million from cash interest costs incurred in
2000. Capital expenditures are expected to approximate $20-$25 million over the next twelve month period, a reduction of $38-$43 million from capital expenditures
in 2000. Further, Superior will be deferring 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 $90 million from 2000
levels. Superior further believes its cash and credit availability ($102 million at September 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. Additionally, there could be adverse consequences if Superior is not successful in obtaining the aforementioned amendment to

20

---

its Amended Credit Agreement, which could result in Superior not being in compliance with certain financial covenants as of December 31, 2001 or meeting certain milestone dates for a
Deleveraging Proceeds Transaction, the earliest of which is January 31, 2002. Such outcome, which is not currently anticipated, could result in restricted access to otherwise available
borrowings and an acceleration of debt under the Amended 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 September 30, 2001, Superior Israel had $10.4 million in excess availability under its revolving
credit facility.

Alpine Corporate

As of September 30, 2001, Alpine had corporate cash, cash equivalents and marketable securities (excluding its investments in Superior, PolyVision and
Cookson) of approximately $10 million. As discussed in Note 9 to the accompanying financial statements, on November 14, 2001 Steelcase Inc. acquired all of Alpine's equity
interests in PolyVision resulting in cash proceeds to Alpine of approximately $42 million.

Alpine
also owns approximately 10.5 million common shares (representing 50.5% common share ownership) of Superior (NYSE:SUT) with a market value on November 9, 2001 of
approximately $9.4 million.

As
of September 30, 2001, the Company owned 14.3 million ordinary shares of Cookson (FTSE: CKSN.L) common stock. During the nine months ended September 30, 2001,
the Company entered into certain forward sale derivative transactions related to 10.5 million ordinary shares of Cookson. 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 September 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 September 30, 2001, the Company held 3.8 million Cookson shares not subject to the above "collar" arrangements with a fair market value as of November 9, 2001 of
$4.8 million.

At
September 30, 2001, Alpine had $13.8 million outstanding under a corporate revolving credit facility which matures on November 15, 2001. Alpine intends to pay
off all its outstanding borrowings under this facility through application of cash proceeds from the sale of its investment in PolyVision.

Upon
completion of the sale of PolyVision (including the receipt of $42 million in cash) and the payoff of the aforementioned corporate revolving credit facility, Alpine will
have cash and cash equivalents of more than $35 million.

Alpine
has no other major commitments over the next twelve months other than periodic interest cost on Alpine's senior subordinated notes ($1.4 million annually); Alpine
corporate overhead expense, which has been substantially reduced over the past six month period; and payments to certain former employees of contractual retirement and deferred compensation
arrangements. For the next twelve month period, Alpine expects to fund these aforementioned commitments from available cash reserves.

Impact of Recent Technical Pronouncements

In July 2001, the Financial Accounting Standards Board ("FASB") 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

21

---

No. 142, which is effective for the Company beginning January 1, 2002, requires that goodwill and certain other intangibles 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; however, goodwill will be subject to impairment reviews beginning in the first quarter of 2002, which may result in future
periodic write-downs. Management is in the process of evaluating what impact the initial impairment assessments may have on the Company's financial statements.

In
July 2001, the FASB also issued SFAS No. 143, "Accounting for Asset Retirement Obligations". SFAS No. 143 requires entities to record the fair value of a
liability for an asset retirement obligation in the period in which it is incurred. When the liability is initially recorded, the entity capitalizes the cost by increasing the carrying amount of the
related long-lived asset. Over time, the liability is accreted to its present value each period and the capitalized cost is depreciated over the useful life of the related asset. Upon
settlement of the liability, the entity either settles the obligation for the amount recorded
or incurs a gain or loss. SFAS No. 143 is effective for fiscal years beginning after June 15, 2002. Management is evaluating the effect of this statement on the Company's results of
operations and financial position.

In
August 2001, the FASB issued Statement No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets". SFAS No. 144 supersedes FASB
Statement No. 121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of" and the accounting and reporting provisions of APB
Opinion No. 30, "Reporting the Results of OperationsReporting the Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual and Infrequently Occurring Events and
Transactions" for the disposal of a segment of a business (as previously defined in APB Opinion 30). The FASB issued SFAS No. 144 to establish a single accounting model, based on the framework
established in SFAS No. 121 for long-lived assets to be disposed of by sale. SFAS No. 144 broadens the presentation of discontinued operations in the income statement to
include a component of an entity (rather than a segment of a business). A component of an entity comprises operations and cash flows that can be clearly distinguished, operationally and for financial
reporting purposes, from the rest of the entity. SFAS No. 144 also requires that discontinued operations be measured at the lower of the carrying amount or fair market value less cost to sell.
SFAS No. 144 is effective for fiscal years beginning after December 15, 2001 and should be applied prospectively. Management is evaluating the effect of this statement on the Company's
results of operations and financial position.

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.

22

---



PART II. OTHER INFORMATION

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

None.

None.

23

---



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: November 14, 2001 |  | By:                   
|                        |  |                       

24

---

QuickLinks