SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549



FORM 10-Q

(Mark One)

[X]   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 29, 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 333-62227



AMERICAN COMMERCIAL LINES LLC
(Exact Name of Registrant as Specified in Its Charter)



Delaware
(State or Other Jurisdiction of
Incorporation or Organization)

52-210660
(IRS Employer Identification No.)

1701 East Market Street
Jeffersonville, Indiana  47130
(Address of Principal Executive Offices)(Zip Code)

(812) 288-0100
(Registrants Telephone Number, Including Area Code)

Not Applicable
(Former Name, Former Address and Former Fiscal Year,
if Changed Since Last Report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ]



As of June 29, 2001, the registrant had 100 membership interests outstanding.

INDEX

|                                                                    | Page Number
|------------------------------------------------------------------- | -----------
|                                                                    |            
|PART I. FINANCIAL INFORMATION                                       |            
|                                                                    |            
|Item 1. Financial Statements (unaudited)                            |            
|                                                                    |            
|1. Condensed Consolidated Statement of Earnings for the             |            
|Quarters Ended June 29, 2001 and June 30, 2000                      |            
|                                                                    |            
|2. Condensed Consolidated Statement of Cash Flows for the           |            
|Quarters Ended June 29, 2001 and June 30, 2000                      |            
|                                                                    |            
|3. Condensed Consolidated Statement of Financial Position           |            
|At June 29, 2001 and December 29, 2000                              |            
|                                                                    |            
|4. Condensed Consolidated Statement of Members Deficit             |            
|At June 29, 2001, December 29, 2000 and December 31, 1999           |            
|                                                                    |            
|Notes to Condensed Consolidated Financial Statements                |            
|                                                                    |            
|Item 2. Managements Discussion and Analysis of Financial Condition |            
|and Results of Operations                                           |            
|                                                                    |            
|Item 3. Quantitative and Qualitative Disclosures About Market Risk  |            
|                                                                    |            
|PART II. OTHER INFORMATION                                          |            
|                                                                    |            
|Item 6. Exhibits and Reports on Form 8-K                            |            
|                                                                    |            
|Signature                                                           |            
|                                                                    |            

PART 1

# FINANCIAL INFORMATION

# Item 1. Financial Statements

# AMERICAN COMMERCIAL LINES LLC
              CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
                          (Dollars in Thousands)

|                                  | Quarter Ended | Six Months Ended
|--------------------------------- | ------------- | ----------------
|
|
|OPERATING REVENUE                 |               | $ 192,884       
|OPERATING EXPENSE                 |              
|Materials, Supplies and Other     |               | 86,382          
|Rent                              |               | 14,258          
|Labor and Fringe Benefits         |               | 41,138          
|Fuel                              |               | 23,930          
|Depreciation and Amortization     |               | 14,176          
|Gain on Property Dispositions     |               | (11,033         
|Taxes, Other Than Income Taxes    |               | 6,839           
|                                  |               |                 
|                                  |               | 175,690         
|                                  |               |                 
|OPERATING INCOME                  |               | 17,194          
|OTHER EXPENSE (INCOME)            |              
|Interest Expense                  |               | 18,529          
|Other, Net                        |               | (1,636          
|                                  |               |                 
|                                  |               | 16,893          
|                                  |               |                 
|EARNINGS (LOSS) BEFORE INCOME     |              
|TAXES, EXTRAORDINARY ITEMS        |              
|AND CUMULATIVE EFFECT OF          |              
|ACCOUNTING CHANGE                 |               | 301             
|INCOME TAXES                      |               | 159             
|                                  |               |                 
|EARNINGS (LOSS) BEFORE            |              
|EXTRAORDINARY ITEMS AND           |              
|CUMULATIVE EFFECT OF              |              
|ACCOUNTING CHANGE                 |               | 142             
|EXTRAORDINARY ITEMS - GAIN/(LOSS) |              
|ON EARLY EXTINGUISHMENT           |              
|OF DEBT                           |               | 1,885           
|CUMULATIVE EFFECT OF              |              
|ACCOUNTING CHANGE                 |               | --              
|                                  |               |                 
|NET EARNINGS (LOSS)               |               | $     2,027     
|                                  |               |                 

See accompanying Notes to Condensed Consolidated Financial Statements.

# AMERICAN COMMERCIAL LINES LLC
              CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
                          (Dollars in Thousands)

|                                                    | Six Months Ended
|--------------------------------------------------- | ----------------
|
|
|OPERATING ACTIVITIES                                |                 
|Net Loss                                            |                 
|Adjustments to Reconcile Net Loss to Net Cash       |                 
|Provided by (Used in) Operating Activities:         |                 
|Depreciation and Amortization                       |                 
|Gain on Property Dispositions                       |                 
|Other Operating Activities                          |                 
|Changes in Operating Assets and Liabilities:        |                 
|Accounts Receivable                                 |                 
|Materials and Supplies                              |                 
|Accrued Interest                                    |                 
|Other Current Assets                                |                 
|Other Current Liabilities                           |                 
|                                                    |                 
|Net Cash (Used in) Provided by Operating Activities |                 
|                                                    |                 
|INVESTING ACTIVITIES                                |                 
|Property Additions                                  |                 
|Purchase of Barging Assets                          |                 
|Proceeds from Property Dispositions                 |                 
|Proceeds from Sale of Terminals                     |                 
|Proceeds from Sale of Restricted Investment         |                 
|Other Investing Activities                          |                 
|                                                    |                 
|Net Cash Provided by (Used in) Investing Activities |                 
|                                                    |                 
|FINANCING ACTIVITIES                                |                 
|Short-Term Borrowings                               |                 
|Long Term Debt Repaid                               |                 
|Outstanding Checks Net of Deposits                  |                 
|Debt Costs                                          |                 
|Other Financing                                     |                 
|                                                    |                 
|Net Cash Used in Financing Activities               |                 
|                                                    |                 
|Net Decrease in Cash and Cash Equivalents           |                 
|Cash and Cash Equivalents at Beginning of Period    |                 
|                                                    |                 
|Cash and Cash Equivalents at End of Period          |                 
|                                                    |                 

See accompanying Notes to Condensed Consolidated Financial Statements.

# AMERICAN COMMERCIAL LINES LLC
                   CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
                           (Dollars in Thousands)

|                                       | June 29,2001 | December 29,2000
|-------------------------------------- | ------------ | ----------------
|
|ASSETS                                 |              |                 
|CURRENT ASSETS                         |             
|Cash and Cash Equivalents              |              | $   30,590      
|Accounts Receivable, Net               |              | 48,081          
|Materials and Supplies                 |              | 33,104          
|Other Current Assets                   |              | 29,500          
|                                       |              |                 
|Total Current Assets                   |              | 141,275         
|                                       |              |                 
|PROPERTIES-Net                         |              | 476,410         
|NET PENSION ASSET                      |              | 25,294          
|OTHER ASSETS                           |              | 104,676         
|                                       |              |                 
|Total Assets                           |              | $ 747,655       
|                                       |              |                 
|                                       |              |                 
|LIABILITIES                            |             
|CURRENT LIABILITIES                    |             
|Accounts Payable                       |              | $   49,518      
|Accrued Payroll and Fringe Benefits    |              | 13,077          
|Deferred Revenue                       |              | 16,526          
|Accrued Claims and Insurance Premiums  |              | 24,297          
|Accrued Interest                       |              | 18,630          
|Short-Term Debt                        |              | 75,000          
|Current Portion of Long-Term Debt      |              | 14,120          
|Other Current Liabilities              |              | 47,449          
|                                       |              |                 
|Total Current Liabilities              |              | 258,617         
|                                       |              |                 
|LONG-TERM DEBT                         |              | 608,329         
|PENSION LIABILITY                      |              | 19,895          
|OTHER LONG-TERM LIABILITIES            |              | 30,691          
|                                       |              |                 
|Total Liabilities                      |              | 917,532         
|                                       |              |                 
|                                       |              |                 
|MEMBERS DEFICIT                       |             
|Members Interest                      |              | 220,074         
|Other Capital                          |              | 162,167         
|Retained Deficit                       |              | (552,118        
|                                       |              |                 
|Total Members Deficit                 |              | (169,877        
|                                       |              |                 
|Total Liabilities and Members Deficit |              | $ 747,655       
|                                       |              |                 

See accompanying Notes to Condensed Consolidated Financial Statements.

# AMERICAN COMMERCIAL LINES LLC
                   CONDENSED CONSOLIDATED STATEMENT OF MEMBERS DEFICIT
                           (Dollars in Thousands)

|                                            | MembersInterest | OtherCapital | Earnings(Deficit) | Total    
|------------------------------------------- | ---------------- | ------------ | ----------------- | ---------
|                                            |                  |              |                   |          
|Balance at December 25, 1998                |                  | $ 220,047    |                   | $ 161,051
|                                            |                  |              |                   |          
|Comprehensive Income:                       |                 
|Net earnings                                |                  | --           |                   | --       
|Foreign currency translation                |                  | --           |                   | (337     
|                                            |                  |              |                   |          
|Total Comprehensive Income                  |                  | --           |                   | (337     
|Contribution of capital by CSX              |                  | --           |                   | 1,054    
|Other                                       |                  | --           |                   | --       
|Issuance of membership interests            |                  | 27           |                   | --       
|Cash distribution to partners               |                  | --           |                   | --       
|                                            |                  |              |                   |          
|Balance at December 31, 1999                |                  | 220,074      |                   | 161,768  
|                                            |                  |              |                   |          
|Comprehensive Loss:                         |                 
|Net loss                                    |                  | --           |                   | --       
|Foreign currency translation                |                  | --           |                   | (147     
|                                            |                  |              |                   |          
|Total Comprehensive Loss                    |                  | --           |                   | (147     
|Contribution of capital by CSX              |                  | --           |                   | 1,694    
|                                            |                  |              |                   |          
|Balance at December 29, 2000                |                  | 220,074      |                   | 163,315  
|                                            |                  |              |                   |          
|Cumulative Effect of Accounting Change      |                 
|as of December 30, 2000 (Unaudited)         |                  | --           |                   | (300     
|                                            |                  |              |                   |          
|Comprehensive Loss (Unaudited):             |                 
|Net loss                                    |                  | --           |                   | --       
|Net loss on fuel hedges designated and      |                 
|qualifying as cash flow hedging instruments
|instruments                                 |                  | --           |                   | (691     
|Net loss on interest rate swaps designated  |                 
|and qualifying as cash flow hedging         |                 
|instruments                                 |                  | --           |                   | (317     
|Foreign currency translation                |                  | --           |                   | (152     
|                                            |                  |              |                   |          
|Total Comprehensive Loss                    |                  | --           |                   | (1,160   
|Contribution of capital by CSX              |                  | --           |                   | 312      
|Consolidation of ACL Funding Corp.          |                  | --           |                   | --       
|                                            |                  |              |                   |          
|                                            |                  |              |                   |          
|Balance at June 29, 2001                    |                  | $ 220,074    |                   | $ 162,167
|                                            |                  |              |                   |          

See accompanying Notes to Condensed Consolidated Financial Statements.

# AMERICAN COMMERCIAL LINES LLC
                   NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
                           (Dollars in Thousands)

# NOTE 1. BASIS OF PRESENTATION

In the opinion of management, the accompanying condensed consolidated financial statements contain all adjustments necessary to
present fairly the companys financial position at June 29, 2001 and December 29, 2000, the results of its operations and its cash
flows for the quarters and six months ended June 29, 2001 and June 30, 2000, such adjustments being of a normal recurring nature.  Operating results
for the quarters and six months ending ended June 29, 2001 are not necessarily indicative of the results that may be expected for the fiscal year ended
December 28, 2001.

While management believes that the disclosures presented are adequate to make the information not misleading, it is suggested that
these condensed consolidated financial statements be read in conjunction with the 2000 audited consolidated financial statements and
the notes related thereto included in American Commercial Lines LLCs (ACLs) Form 10-K.

ACLs fiscal year ends on the last Friday in December.  The condensed consolidated financial statements presented are for the 13 and
26 weeks ended June 29, 2001 and June 30, 2000, and the fiscal year (52 weeks) ended December 29, 2000.

As disclosed in the 2000 consolidated financial statements and related notes, certain second quarter 2000 amounts as reported in the second quarter 2000 10-Q were restated as follows:

|                               | Quarter Ended | Six Months Ended
|------------------------------ | ------------- | ----------------
|
|Operating Revenue              |               | $ 193,865       
|Operating Income               |               | 16,529          
|Loss Before Extraordinary Item |               | (1,709          
|Net Loss                       |               | (2,443          

Certain prior period amounts have been reclassified to conform
to the current year presentation.

# NOTE 2. SIGNIFICANT TRANSACTIONS

During the second quarter 2001, ACL sold four towboats, a tank barge
cleaning facility in Baton Rouge, Louisiana and other assets.  This resulted in a gain of $11.0 million that is recported as gain on
property dispositions in the condensed consolidated statement of operations.  ACL also purchased $5.0 million par value of ACL
Senior Notes at a discount in the second quarter.  This resulted in a gain on the early estinguishment of debt of $1.9 million
which is reported as an extraordinary item in the condensed consolidated statement of operations.

At June 29, 2001 and December 29, 2000, ACL had $54.0 million and $56.0
million, respectively, outstanding under the agreement and had $10.5 million and $15.3 million, respectively, of net residual interest in the securitized receivables which is included in Accounts
Receivable, Net in ACLs consolidated financial statements.  The fair value of the net residual interest is measured at the time of the sale and is
based on the sale of similar assets.  In the first six months of 2001, ACL received gross proceeds of $10.8 million from the sale of receivables
and made gross payments of $12.8 million under this Agreement.

# AMERICAN COMMERCIAL LINES LLC
                           NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
                                                (Dollars in Thousands)

# NOTE 3. MATERIAL AND SUPPLIES

Materials and Supplies are carried at the lower of cost
(average) or market and consist of the following:

|                   | June 29,2001 | December 29,2000
|------------------ | ------------ | ----------------
|Raw Materials      |              | $  3,711        
|Work in Process    |              | 13,565          
|Parts and Supplies |              | 15,828          
|                   |              |                 
|                   |              | $33,104         
|                   |              |                 

# NOTE 4.  FINANCIAL INSTRUMENTS AND RISK MANAGEMENT, Continued

Fuel Price Risk Management

ACL uses forward fuel purchases to provide short-term protection
against a sharp increase in diesel fuel prices. These instruments generally
cover a portion of the companys forecasted diesel fuel needs for tow boat
operations over the next one to twelve months.

ACL accounts for the forward fuel purchases as cash flow hedges.
In accordance with SFAS 133, such financial instruments are marked-to-market
with the offset to other comprehensive income and then subsequently recognized
as a component of fuel expense when the underlying fuel being hedged is used.
The ineffective portion of these future agreements is determined based on the
correlation between Gulf Coast Spot No. 2 Pipeline Fuel prices and ACLs
diesel fuel purchase prices, which was not material for the quarter ended June
29, 2001.

At June 29, 2001, ACL had forward fuel purchase contracts
outstanding with an aggregate notional amount of approximately $18.5 million and
a fair value of approximately $0.7 million (loss), which has been recorded in
other current liabilities with the offset to other comprehensive income. The
loss will be recognized in earnings within the next six months.

Interest Rate Risk Management

ACL entered into an interest rate cap agreement in the third
quarter of 2000 to reduce the impact of potential rate increases on floating
rate debt. The interest rate cap has a notional amount of $202 million as of
June 29, 2001 and is effective through August 11, 2003. The Company accounts for
the interest rate cap as a cash flow hedge whereby the fair value of the
interest rate cap is reflected as an asset or liability in the accompanying condensed
consolidated statement of financial position. The cap rate (hedging instrument)
is the same interest rate index as the base interest rate for the floating rate
debt (hedged item). When the interest rate index exceeds the interest rate cap,
a portion of the change in fair value of the instrument represents a change in
intrinsic value which is an effective hedge. This portion of the change in value
is recorded as other comprehensive income. The remaining change in fair
value is recorded as other expense
(income) on the condensed consolidated statement of operations.

For the quarter and six months ended June 29, 2001 the entire
change in fair value resulted in a (gain) loss of ($11) and
$95, respectively, are recorded in other expense (income).

ACL also records changes to other assets on the accompanying condensed consolidated
statement of financial position, with the offset recorded as comprehensive
income (loss), for changes in the fair value of interest rate swap agreements
entered into by Global Material Services LLC (GMS), an entity in
which ACL has a 50% ownership interest accounted for by the equity method. ACL
recognized a comprehensive loss of $317 for its share of these swaps in the six months
ended June 29, 2001.

# AMERICAN COMMERCIAL LINES LLC
                   NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
                           (Dollars in Thousands)

# NOTE 5. BUSINESS SEGMENTS

|                                  | Reportable Segments |          |  |        
|--------------------------------- | ------------------- | -------- |  | -------
|
|Quarter ended June 29, 2001       |                     |          |  |        
|Revenues  from external customers |                     | $164,271 |  | $25,515
|Intersegment revenues             |                     | --       |  | 401    
|Segment operating income          |                     | 13,933   |  | 2,619  
|                                  |                     |          |  |        
|Quarter ended June 30, 2000       |                    
|Revenues  from external customers |                     | $151,287 |  | $36,788
|Intersegment revenues             |                     | --       |  | 388    
|Segment operating income          |                     | 11,590   |  | 3,079  
|                                  |                     |          |  |        
|Six Months ended June 29, 2001    |                    
|Revenues  from external customers |                     | $310,552 |  | $48,886
|Intersegment revenues             |                     | --       |  | 1,056  
|Segment operating income          |                     | 2,276    |  | 3,480  
|                                  |                     |          |  |        
|Six Months ended June 30, 2000    |                    
|Revenues  from external customers |                     | $286,489 |  | $63,565
|Intersegment revenues             |                     | --       |  | 1,982  
|Segment operating income          |                     | 14,934   |  | 6,044  

(1) Financial data for segments below the reporting thresholds are attributable to two operating segments - a segment
operating
      terminals along the U.S. inland waterways and a segment providing voice and data communications to marine companies
      operating on the U.S. inland waterways.  The segment providing voice and data communications was sold in 2000.

The following is a reconciliation of ACLs revenues from
external customers and segment earnings to ACLs consolidated totals.

|                                                   | Quarters Ended | Six Months Ended
|-------------------------------------------------- | -------------- | ----------------
|
|Revenues                                           |                |                 
|Revenues from external customers                   |                | $ 192,884       
|Intersegment revenues                              |                | 405             
|Elimination of intersegment revenues               |                | (405            
|                                                   |                |                 
|Operating revenue                                  |                | $ 192,884       
|                                                   |                |                 
|Earnings                                           |               
|Total segment operating income                     |                | $   17,194      
|Unallocated amounts:                               |               
|Interest expense                                   |                | (18,529         
|Other, net                                         |                | 1,636           
|                                                   |                |                 
|Earnings (loss) before income taxes, extraordinary |               
|items and cumulative effect of accounting change   |                | $        301    
|                                                   |                |                 

# AMERICAN COMMERCIAL LINES LLC
                   NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
                           (Dollars in Thousands)

# NOTE 6. RELATED PARTIES

ACL and Vectura Group LLC
have invested in a new company named Vessel Leasing LLC (Vessel
Leasing). ACL has recorded its $2,707 investment in Vessel Leasing in
Other Assets at June 29, 2001. ACL also recorded sales of barges to Vessel
Leasing in the first quarter and second quarter of 2001 for $15.2 and $7.0
million, respectively. ACL currently leases vessels from Vessel Leasing LLC.

# NOTE 7.  CONTINGENCIES

A number of legal actions
are pending against ACL in which claims are made in substantial amounts. While
the ultimate results of pending litigation cannot be predicted with certainty,
management does not currently expect that resolution of these matters will have
a material adverse effect on the consolidated results of operations, financial
position and cash flows.

# NOTE 8.  CHANGES IN ACCOUNTING STANDARDS

In June 1998, the Financial
Accounting Standards Board (FASB) issued Statement No. 133,
Accounting for Derivative Instruments and Hedging Activities. This
Statement establishes accounting and reporting standards for derivative
instruments, including certain derivative instruments embedded in other
contracts, and for hedging activities. It requires that an entity recognize all
derivatives as either assets or liabilities in the statement of financial
position and measure those instruments at fair value.

If certain conditions are
met, a derivative may be specifically designated as (a) a hedge of the exposure
to changes in the fair value of a recognized asset or liability or an
unrecognized firm commitment, (b) a hedge of the exposure to variable cash flows
of a forecasted transaction, or (c) a hedge of the foreign currency exposure of
a net investment in a foreign operation, an unrecognized firm commitment, an
available-for-sale security, or a foreign-currency-dominated forecasted
transaction. The accounting for changes in the fair value of a derivative (that
is, gains and losses) depends on the intended use of the derivative and the
resulting designation. ACL adopted Statement No. 133 at the beginning of the
first quarter of 2001 with a $29 non-cash gain to comprehensive income due to
purchases of fuel contract futures, a $329 non-cash charge to comprehensive loss
to recognize ACLs share of Global Material Services comprehensive
loss on interest rate swaps and a $490 non-cash charge to cumulative effect of accounting change for an interest rate cap.

In September 2000, the FASB issued Statement of Financial Accounting Standards No. 140, "Accounting for Transfers and
Servicing of Financial Assets and Extinguishment of Liabilities" ("SFAS No. 140").  The Statement is effective for transfers
and servicing of financial assets and extinguishments of liabilities occurring after March 31, 2001.  ACL adopted SFAS No.
140 on April 1, 2001.  The adoption required the consolidation of ACL Funding Corp., a wholly-owned subsidiary, that was
previously treated as a non-consolidated Qualified Special Purpose Entity.  The consolidation resulted in a charge to
Retained Earnings of $989 in the second quarter 2001.

# AMERICAN COMMERCIAL LINES LLC
                   NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
                           (Dollars in Thousands)

# NOTE 8.  CHANGES IN ACCOUNTING STANDARDS, Continued

In July 2001, the FASB
issued Statement of Financial Accounting Standards No. 141 (FAS 141),
Business Combinations, which provides that all business combinations
should be accounted for using the purchase method of accounting and establishes
criteria for the initial recognition and measurement of goodwill and other
intangible assets recorded in connection with a business combination. The
provisions of FAS 141 apply to all business combinations initiated after June
30, 2001.  ACL will apply the provisions of FAS 141 to any future
business combinations.

In addition, the FASB issued Statements of Financial
Accounting Standards No. 142 (FAS 142), Goodwill and Other Intangible
Assets, which establishes the accounting for goodwill and other intangible
assets following their recognition. FAS 142 applies to all goodwill and other
intangible assets whether acquired singly, as part of a group, or in a business
combination. FAS 142 provides
that goodwill should not be amortized but should be tested for impairment
annually using a fair-value based approach. In addition, FAS 142
provides that other intangible assets other than goodwill should be amortized
over their useful lives and reviewed for impairment in accordance with Statement
of Financial Accounting Standards No. 121, Accounting for the Impairment
of Long-Lived Assets to be Disposed Of. FAS 142 is effective beginning on
January 1, 2002. Upon adoption, ACL will be required to perform a transitional
impairment test under FAS 142 for all goodwill recorded as of January 1, 2002.
Any impairment loss recorded as a result of completing the transitional
impairment test will be treated as a change in accounting principle. The impact
of the adoption of FAS 142 on ACLs results of operations for all periods
beginning on or after January 1, 2002 will be to eliminate amortization of
goodwill. Management of ACL has not performed a transitional impairment test
under FAS 142 and accordingly cannot estimate the impact of the adoption FAS 142
as of January 1, 2002.

# NOTE 9. GUARANTOR FINANCIAL STATEMENTS

The $735 million of debt
issued by ACL and a revolving credit facility, which provides for revolving
loans and the issuance of letters of credit in an aggregate amount up to $100
million, are guaranteed by ACLs wholly-owned domestic subsidiaries, other
than ACL Capital Corp. (which was formed in connection with the transaction),
any Accounts Receivable Subsidiary (as defined in the Indentures with respect to
such debt) and certain subsidiaries of ACL without substantial assets or
operations (collectively the Guarantor Subsidiaries). Such
guarantees are full, unconditional and joint and several. Separate financial
statements of the Guarantor Subsidiaries are not presented because management
has determined that they would not be material to investors. The following
supplemental financial information sets forth on a combined basis, combining
statements of financial position, statements of operations and statements of cash
flows for the Guarantor Subsidiaries, non-guarantor subsidiaries and for ACL as
of June 29, 2001 and December 29, 2000 and for the quarters and six months ended June 29, 2001 and June 30, 2000.

# AMERICAN COMMERCIAL LINES LLC
           NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
  (Unaudited)
     Condensed Combining Statement of Operations for the Quarter Ended June 29, 2001
    (Dollars in Thousands)

|                                     | GuarantorSubsidiaries | OtherSubsidiaries | Eliminations | CombinedTotals
|------------------------------------ | --------------------- | ----------------- | ------------ | --------------
|OPERATING REVENUE                    |                       | $ 184,011         |              | $ 8,873       
|                                     |                       |                   |              |               
|OPERATING EXPENSE                    |                      
|Materials, Supplies and Other        |                       | 81,407            |              | 4,975         
|Rent                                 |                       | 13,827            |              | 431           
|Labor and Fringe Benefits            |                       | 40,132            |              | 1,006         
|Fuel                                 |                       | 23,794            |              | 136           
|Depreciation and Amortization        |                       | 12,875            |              | 1,301         
|Gain on Property Dispositions        |                       | (11,033           | )            | -             
|Taxes, Other Than Income Taxes       |                       | 6,836             |              | 3             
|                                     |                       |                   |              |               
|                                     |                       | 167,838           |              | 7,852         
|                                     |                       |                   |              |               
|                                     |                       |                   |              |               
|OPERATING INCOME                     |                       | 16,173            |              | 1,021         
|                                     |                       |                   |              |               
|OTHER EXPENSE (INCOME)               |                      
|Interest Expense                     |                       | 18,529            |              | --            
|Interest Expense, Affiliate - Net    |                       | --                |              | 1,611         
|Other, Net                           |                       | (2,366            | )            | (881          
|                                     |                       |                   |              |               
|                                     |                       | 16,163            |              | 730           
|                                     |                       |                   |              |               
|                                     |                       |                   |              |               
|EARNINGS BEFORE INCOME TAXES AND     |                      
|EXTRAORDINARY ITEM                   |                       | 10                |              | 291           
|                                     |                       |                   |              |               
|INCOME TAXES (BENEFIT)               |                       | 185               |              | (26           
|                                     |                       |                   |              |               
|                                     |                       |                   |              |               
|(LOSS) EARNINGS BEFORE EXTRAORDINARY
|ITEM                                 |                       | (175              | )            | 317           
|                                     |                       |                   |              |               
|EXTRAORDINARY ITEM - GAIN ON EARLY   |                      
|EXTINGUISHMENT OF DEBT               |                       | 1,885             |              | --            
|                                     |                       |                   |              |               
|                                     |                       |                   |              |               
|NET EARNINGS                         |                       | $     1,710       |              | $    317      
|                                     |                       |                   |              |               

# AMERICAN COMMERCIAL LINES LLC
             NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
  (Unaudited) (As Restated)
        Condensed Combining Statement of Operations for the Quarter Ended June 30, 2000
    (Dollars in Thousands)

|                                    | GuarantorSubsidiaries | OtherSubsidiaries | Eliminations | CombinedTotals
|----------------------------------- | --------------------- | ----------------- | ------------ | --------------
|OPERATING REVENUE                   |                       | $ 181,419         |              | $ 12,039      
|                                    |                       |                   |              |               
|OPERATING EXPENSE                   |                      
|Materials, Supplies and Other       |                       | 79,929            |              | 4,803         
|Rent                                |                       | 11,314            |              | 389           
|Labor and Fringe Benefits           |                       | 38,287            |              | 2,286         
|Fuel                                |                       | 21,007            |              | 1,004         
|Depreciation and Amortization       |                       | 11,807            |              | 1,833         
|Gain on Property Dispositions       |                       | (1,939            | )            | -             
|Taxes, Other Than Income Taxes      |                       | 6,436             |              | 180           
|                                    |                       |                   |              |               
|                                    |                       | 166,841           |              | 10,495        
|                                    |                       |                   |              |               
|                                    |                       |                   |              |               
|OPERATING INCOME                    |                       | 14,578            |              | 1,544         
|                                    |                       |                   |              |               
|OTHER EXPENSE (INCOME)              |                      
|Interest Expense                    |                       | 17,681            |              | --            
|Interest Expense, Affiliate - Net   |                       | --                |              | 1,515         
|Other, Net                          |                       | (1,556            | )            | (63           
|                                    |                       |                   |              |               
|                                    |                       | 16,125            |              | 1,452         
|                                    |                       |                   |              |               
|                                    |                       |                   |              |               
|(LOSS) EARNINGS BEFORE INCOME TAXES |                      
|AND EXTRAORDINARY ITEM              |                       | (1,547            | )            | 92            
|INCOME TAXES                        |                       | 21                |              | 640           
|                                    |                       |                   |              |               
|LOSS BEFORE EXTRAORDINARY ITEM      |                       | (1,568            | )            | (548          
|                                    |                       |                   |              |               
|EXTRAORDINARY ITEM - LOSS ON        |                      
|EARLY EXTINGUISHMENT OF DEBT        |                       | (734              | )            | --            
|                                    |                       |                   |              |               
|                                    |                       |                   |              |               
|NET LOSS                            |                       | $  (2,302         | )            | $    (548     
|                                    |                       |                   |              |               

# AMERICAN COMMERCIAL LINES LLC
            NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
  (Unaudited)
    Condensed Combining Statement of Operations for the Six Months Ended June 29, 2001
    (Dollars in Thousands)

|                                   | GuarantorSubsidiaries | OtherSubsidiaries | Eliminations | CombinedTotals
|---------------------------------- | --------------------- | ----------------- | ------------ | --------------
|OPERATING REVENUE                  |                       | $ 351,137         |              | $ 14,845      
|                                   |                       |                   |              |               
|OPERATING EXPENSE                  |                      
|Materials, Supplies and Other      |                       | 161,278           |              | 9,727         
|Rent                               |                       | 27,724            |              | 792           
|Labor and Fringe Benefits          |                       | 79,491            |              | 1,832         
|Fuel                               |                       | 47,627            |              | 64            
|Depreciation and Amortization      |                       | 25,794            |              | 2,572         
|Gain on Property Dispositions      |                       | (11,074           | )            | -             
|Taxes, Other Than Income Taxes     |                       | 13,389            |              | 6             
|                                   |                       |                   |              |               
|                                   |                       | 344,229           |              | 14,993        
|                                   |                       |                   |              |               
|                                   |                       |                   |              |               
|OPERATING INCOME (LOSS)            |                       | 6,908             |              | (148          
|                                   |                       |                   |              |               
|OTHER EXPENSE (INCOME)             |                      
|Interest Expense                   |                       | 38,080            |              | --            
|Interest Expense, Affiliate - Net  |                       | --                |              | 3,165         
|Other, Net                         |                       | (3,730            | )            | (1,541        
|                                   |                       |                   |              |               
|                                   |                       | 34,350            |              | 1,624         
|                                   |                       |                   |              |               
|                                   |                       |                   |              |               
|LOSS BEFORE INCOME TAXES,          |                      
|EXTRAORDINARY ITEM AND             |                      
|CUMULATIVE EFFECT OF               |                      
|ACCOUNTING CHANGE                  |                       | (27,442           | )            | (1,772        
|INCOME TAXES                       |                       | 211               |              | 51            
|                                   |                       |                   |              |               
|                                   |                       |                   |              |               
|LOSS BEFORE EXTRAORDINARY ITEM AND |                      
|CUMULATIVE EFFECT OF ACCOUNTING    |                      
|CHANGE                             |                       | (27,653           | )            | (1,823        
|                                   |                       |                   |              |               
|EXTRAORDINARY ITEM - GAIN ON EARLY |                      
|EXTINGUISHMENT OF DEBT             |                       | 1,885             |              | --            
|                                   |                       |                   |              |               
|CUMULATIVE EFFECT OF ACCOUNTING    |                      
|CHANGE                             |                       | (490              | )            | --            
|                                   |                       |                   |              |               
|                                   |                       |                   |              |               
|NET LOSS                           |                       | $(26,258          | )            | $(1,823       
|                                   |                       |                   |              |               

# AMERICAN COMMERCIAL LINES LLC
             NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
  (Unaudited) (As Restated)
       Condensed Combining Statement of Operations for the Six Months Ended June 30, 2000
    (Dollars in Thousands)

|                                   | GuarantorSubsidiaries | OtherSubsidiaries | Eliminations | CombinedTotals
|---------------------------------- | --------------------- | ----------------- | ------------ | --------------
|OPERATING REVENUE                  |                       | $ 345,968         |              | $ 14,967      
|                                   |                       |                   |              |               
|OPERATING EXPENSE                  |                      
|Materials, Supplies and Other      |                       | 146,141           |              | 8,787         
|Rent                               |                       | 20,755            |              | 786           
|Labor and Fringe Benefits          |                       | 77,911            |              | 3,899         
|Fuel                               |                       | 39,150            |              | 1,471         
|Depreciation and Amortization      |                       | 23,147            |              | 3,656         
|Gain on Property Dispositions      |                       | (1,780            | )            | -             
|Taxes, Other Than Income Taxes     |                       | 12,575            |              | 344           
|                                   |                       |                   |              |               
|                                   |                       | 317,899           |              | 18,943        
|                                   |                       |                   |              |               
|                                   |                       |                   |              |               
|OPERATING INCOME (LOSS)            |                       | 28,069            |              | (3,976        
|                                   |                       |                   |              |               
|OTHER EXPENSE (INCOME)             |                      
|Interest Expense                   |                       | 34,977            |              | --            
|Interest Expense, Affiliate - Net  |                       | --                |              | 3,031         
|Other, Net                         |                       | (3,136            | )            | (1,356        
|                                   |                       |                   |              |               
|                                   |                       | 31,841            |              | 1,675         
|                                   |                       |                   |              |               
|                                   |                       |                   |              |               
|LOSS BEFORE INCOME TAXES AND       |                      
|EXTRAORDINARY ITEM                 |                       | (3,772            | )            | (5,651        
|                                   |                       |                   |              |               
|INCOME TAXES                       |                       | 40                |              | 750           
|                                   |                       |                   |              |               
|                                   |                       |                   |              |               
|LOSS BEFORE EXTRAORDINARY ITEM     |                       | (3,812            | )            | (6,401        
|                                   |                       |                   |              |               
|EXTRAORDINARY ITEM - LOSS ON EARLY |                      
|EXTINGUISHMENT OF DEBT             |                       | (734              | )            | --            
|                                   |                       |                   |              |               
|                                   |                       |                   |              |               
|NET LOSS                           |                       | $  (4,546         | )            | $(6,401       
|                                   |                       |                   |              |               

# AMERICAN COMMERCIAL LINES LLC
                 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
       (Unaudited)
   Condensed Combining Statement of Cash Flows for the Six Months Ended June 29, 2001
 (Dollars in Thousands)

|                                                 | GuarantorSubsidiaries | OtherSubsidiaries | Eliminations | CombinedTotals
|------------------------------------------------ | --------------------- | ----------------- | ------------ | --------------
|OPERATING ACTIVITIES                             |                       |                   |              |               
|Net Loss                                         |                       | $(25,267          | )            | $(2,814       
|Adjustments to Reconcile Net Loss to Net Cash    |                      
|Provided by (Used in) Operating Activities:      |                      
|Depreciation and Amortization                    |                       | 27,783            |              | 2,572         
|Gain on Disposition of Property                  |                       | (11,074           | )            | --            
|Other Operating Activities                       |                       | (2,734            | )            | (1,683        
|Changes in Operating Assets and Liabilities:     |                      
|Accounts Receivable                              |                       | 555               |              | (12,936       
|Materials and Supplies                           |                       | (1,968            | )            | (426          
|Accrued Interest                                 |                       | 385               |              | --            
|Other Current Assets                             |                       | (9,342            | )            | 3,765         
|Other Current Liabilities                        |                       | 22,010            |              | 6,012         
|                                                 |                       |                   |              |               
|Net Cash Used in Operating Activities            |                       | 348               |              | (5,510        
|                                                 |                       |                   |              |               
|INVESTING ACTIVITIES                             |                      
|Property Additions                               |                       | (7,279            | )            | (1,729        
|Proceeds from Property Dispositions              |                       | 16,683            |              | --            
|Proceeds from Sale of Terminals                  |                       | 8,241             |              | --            
|Other Investing Activities                       |                       | (7,062            | )            | 7,056         
|                                                 |                       |                   |              |               
|Net Cash Provided by Investing                   |                      
|Activities                                       |                       | 10,583            |              | 5,327         
|                                                 |                       |                   |              |               
|FINANCING ACTIVITIES                             |                      
|Short-Term Borrowings                            |                       | 8,250             |              | --            
|Long-Term Debt Repaid                            |                       | (34,007           | )            | --            
|Cash Dividends Paid                              |                       | --                |              | (1,000        
|Outstanding Checks Net of Deposits               |                       | (9,656            | )            | --            
|Debt Costs                                       |                       | (3,462            | )            | --            
|Other Financing Activities                       |                       | 103               |              | 46            
|                                                 |                       |                   |              |               
|Net Cash Used in Financing Activities            |                       | (38,772           | )            | (954          
|                                                 |                       |                   |              |               
|Net Decrease in Cash and Cash Equivalents        |                       | (27,841           | )            | (1,137        
|Cash and Cash Equivalents at Beginning of Period |                       | 57,289            |              | 2,279         
|                                                 |                       |                   |              |               
|Cash and Cash Equivalents at End of Period       |                       | $ 29,448          |              | $   1,142     
|                                                 |                       |                   |              |               

# AMERICAN COMMERCIAL LINES LLC
                NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
       (Unaudited) (As Restated)
   Condensed Combining Statement of Cash Flows for the Six Months Ended June 30, 2000
 (Dollars in Thousands)

|                                                 | GuarantorSubsidiaries | OtherSubsidiaries | Eliminations | CombinedTotals
|------------------------------------------------ | --------------------- | ----------------- | ------------ | --------------
|OPERATING ACTIVITIES                             |                       |                   |              |               
|Net Loss                                         |                       | $(4,546           | )            | $(6,401       
|Adjustments to Reconcile Net Loss to Net Cash    |                      
|(Used in) Provided by Operating Activities:      |                      
|Depreciation and Amortization                    |                       | 24,587            |              | 3,656         
|Gain on Property Dispositions                    |                       | (1,780            | )            | --            
|Other Operating Activities                       |                       | (4,361            | )            | (1,892        
|Changes in Operating Assets and Liabilities:     |                      
|Accounts Receivable                              |                       | (5,040            | )            | 2,979         
|Materials and Supplies                           |                       | 8,614             |              | 40            
|Accrued Interest                                 |                       | (3,079            | )            | --            
|Other Current Assets                             |                       | (2,494            | )            | 3,944         
|Other Current Liabilities                        |                       | 4,863             |              | 2,081         
|                                                 |                       |                   |              |               
|Net Cash Provided by Operating Activities        |                       | 16,764            |              | 4,407         
|                                                 |                       |                   |              |               
|INVESTING ACTIVITIES                             |                      
|Property Additions                               |                       | (11,823           | )            | (739          
|Purchase of Barging Assets                       |                       | (31,500           | )            | --            
|Proceeds from Property Dispositions              |                       | 3,385             |              | --            
|Proceeds from Sale of Restricted Investment      |                       | 25,288            |              | --            
|Other Investing Activities                       |                       | (2,165            | )            | 462           
|                                                 |                       |                   |              |               
|Net Cash Used in Investing Activities            |                       | (16,815           | )            | (277          
|                                                 |                       |                   |              |               
|FINANCING ACTIVITIES                             |                      
|Short-Term Borrowing                             |                       | 11,000            |              | --            
|Long-Term Debt Repaid                            |                       | (35,318           | )            | (155          
|Outstanding Checks Net of Deposits               |                       | (1,410            | )            | --            
|Other Financing Activities                       |                       | --                |              | (47           
|                                                 |                       |                   |              |               
|Net Cash Used in Financing Activities            |                       | (25,728           | )            | (202          
|                                                 |                       |                   |              |               
|Net (Decrease) Increase in Cash and Cash         |                      
|Equivalents                                      |                       | (25,779           | )            | 3,928         
|Cash and Cash Equivalents at Beginning of Period |                       | 29,238            |              | 1,603         
|                                                 |                       |                   |              |               
|Cash and Cash Equivalents at End of Period       |                       | $   3,459         |              | $ 5,531       
|                                                 |                       |                   |              |               

# AMERICAN COMMERCIAL LINES LLC
                 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
  (Unaudited)
         Condensed Combining Statement of Financial Position at June 29, 2001
   (Dollars in Thousands)

|                                       | GuarantorSubsidiaries | OtherSubsidiaries | Eliminations | CombinedTotals
|-------------------------------------- | --------------------- | ----------------- | ------------ | --------------
|ASSETS                                 |                       |                   |              |               
|CURRENT ASSETS                         |                      
|Cash and Cash Equivalents              |                       | $   29,448        |              | $     1,142   
|Accounts Receivable - Net              |                       | 24,331            |              | 23,750        
|Materials and Supplies                 |                       | 31,788            |              | 1,316         
|Other Current Assets                   |                       | 34,428            |              | (4,928        
|                                       |                       |                   |              |               
|Total Current Assets                   |                       | 119,995           |              | 21,280        
|                                       |                       |                   |              |               
|PROPERTIES - NET                       |                       | 437,480           |              | 38,930        
|NET PENSION ASSET                      |                       | 25,294            |              | --            
|OTHER ASSETS                           |                       | 151,582           |              | 51,329        
|                                       |                       |                   |              |               
|Total Assets                           |                       | $ 734,351         |              | $ 111,539     
|                                       |                       |                   |              |               
|                                       |                       |                   |              |               
|LIABILITIES                            |                      
|CURRENT LIABILITIES                    |                      
|Accounts Payable                       |                       | $   49,083        |              | $        435  
|Accrued Payroll and Fringe Benefits    |                       | 13,077            |              | --            
|Deferred Revenue                       |                       | 16,526            |              | --            
|Accrued Claims and Insurance Premiums  |                       | 24,297            |              | --            
|Accrued Interest                       |                       | 18,630            |              | --            
|Short-Term Debt                        |                       | 75,000            |              | --            
|Current Portion of Long-Term Debt      |                       | 14,120            |              | --            
|Other Current Liabilities              |                       | 35,164            |              | 12,285        
|                                       |                       |                   |              |               
|Total Current Liabilities              |                       | 245,897           |              | 12,720        
|                                       |                       |                   |              |               
|LONG-TERM NOTE PAYABLE TO AFFILIATE    |                       | --                |              | 87,267        
|LONG-TERM DEBT                         |                       | 608,329           |              | --            
|PENSION LIABILITY                      |                       | 19,895            |              | --            
|OTHER LONG-TERM LIABILITIES            |                       | 30,107            |              | 584           
|                                       |                       |                   |              |               
|Total Liabilities                      |                       | 904,228           |              | 100,571       
|                                       |                       |                   |              |               
|                                       |                       |                   |              |               
|MEMBERS DEFICIT                       |                      
|Members Interest                      |                       | 220,074           |              | --            
|Other Capital                          |                       | 162,167           |              | 53,183        
|Retained Deficit                       |                       | (552,118          | )            | (42,215       
|                                       |                       |                   |              |               
|Total Members Deficit                 |                       | (169,877          | )            | 10,968        
|                                       |                       |                   |              |               
|Total Liabilities and Members Deficit |                       | $ 734,351         |              | $ 111,539     
|                                       |                       |                   |              |               

# AMERICAN COMMERCIAL LINES LLC
                 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
       Condensed Combining Statement of Financial Position at December 29, 2000
   (Dollars in Thousands)

|                                       | GuarantorSubsidiaries | OtherSubsidiaries | Eliminations | CombinedTotals
|-------------------------------------- | --------------------- | ----------------- | ------------ | --------------
|ASSETS                                 |                       |                   |              |               
|CURRENT ASSETS                         |                      
|Cash and Cash Equivalents              |                       | $   57,288        |              | $     2,280   
|Accounts Receivable - Net              |                       | 32,608            |              | 10,220        
|Materials and Supplies                 |                       | 28,883            |              | 890           
|Other Current Assets                   |                       | 24,823            |              | (1,163        
|                                       |                       |                   |              |               
|Total Current Assets                   |                       | 143,602           |              | 12,227        
|                                       |                       |                   |              |               
|PROPERTIES - NET                       |                       | 469,714           |              | 39,729        
|NET PENSION ASSET                      |                       | 24,512            |              | --            
|OTHER ASSETS                           |                       | 141,534           |              | 51,128        
|                                       |                       |                   |              |               
|Total Assets                           |                       | $ 779,362         |              | $ 103,084     
|                                       |                       |                   |              |               
|                                       |                       |                   |              |               
|LIABILITIES                            |                      
|CURRENT LIABILITIES                    |                      
|Accounts Payable                       |                       | $   28,536        |              | $     1,194   
|Accrued Payroll and Fringe Benefits    |                       | 14,003            |              | --            
|Deferred Revenue                       |                       | 12,011            |              | --            
|Accrued Claims and Insurance Premiums  |                       | 21,047            |              | --            
|Accrued Interest                       |                       | 18,246            |              | --            
|Short-Term Debt                        |                       | 66,750            |              | --            
|Current Portion of Long-Term Debt      |                       | 44,579            |              | --            
|Other Current Liabilities              |                       | 50,918            |              | 5,899         
|                                       |                       |                   |              |               
|Total Current Liabilities              |                       | 256,090           |              | 7,093         
|                                       |                       |                   |              |               
|LONG-TERM NOTE PAYABLE TO AFFILIATE    |                       | --                |              | 86,700        
|LONG-TERM DEBT                         |                       | 613,476           |              | --            
|PENSION LIABILITY                      |                       | 21,389            |              | --            
|OTHER LONG-TERM LIABILITIES            |                       | 28,066            |              | 1,083         
|                                       |                       |                   |              |               
|Total Liabilities                      |                       | $ 919,021         |              | $   94,876    
|                                       |                       |                   |              |               
|                                       |                       |                   |              |               
|MEMBERS DEFICIT                       |                      
|Members Interest                      |                       | 220,074           |              | --            
|Other Capital                          |                       | 163,315           |              | 46,820        
|Retained Deficit                       |                       | (523,048          | )            | (38,612       
|                                       |                       |                   |              |               
|Total Members Deficit                 |                       | (139,659          | )            | 8,208         
|                                       |                       |                   |              |               
|Total Liabilities and Members Deficit |                       | $ 779,362         |              | $ 103,084     
|                                       |                       |                   |              |               

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

## OVERVIEW

American Commercial Lines
LLC (ACL) is an integrated marine transportation and service
company, providing barge transportation on the inland waterways of North and
South America. ACL supports its barging operations by providing towboat and
barge construction, terminal and vessel repair services to American Commercial
Barge Line LLC (ACBL) and third parties. ACBL is the leading
provider of river barge transportation throughout the Inland Waterways.

On May 25, 2001 ACL entered
into an agreement to sell substantially all of the terminals of its wholly-owned subsidiary, American Commercial Terminals LLC (ACT), other than
its coal transfer facility at St. Louis, Missouri and its tank storage facility
at Memphis, Tennessee to Global Material Services LLC (GMS), a joint
venture between ACT and Mid-South Terminal Company, L.P., an unaffiliated third
party. The sale of seven terminals was completed on May 25, 2001. An additional
terminal site in Omaha, Nebraska was sold on June 29, 2001.

On October 24, 2000 ACL
entered into an agreement with Ultrapetrol Bahamas Limited
(Ultrapetrol) to combine the inland river barge transportation
divisions of the two companies operating on the Parana/Paraguay River system in
South America. ACLs 80% majority owned subsidiary, ACBL Hidrovias Limited,
has a 50% ownership interest in the newly formed, joint venture company, UABL
Limited (UABL). UABL operates 20 towboats and a combined fleet of
332 dry cargo and tank barges. UABL serves commodity shippers in Argentina,
Bolivia, Brazil, Paraguay and Uruguay.

On September 6, 2000 ACL
sold its 100% membership interest in Waterway Communications System LLC
(Watercom) to Mobex Network Services Company (Mobex).
The sale of Watercom will not significantly affect ACLs expected future
operating income or cash flow from operating activities.

On May 26, 2000 ACL entered
into an agreement to purchase or lease substantially all of the long-term assets
of Peavey Barge Line and other inland marine transport divisions of Conagra,
Inc. (Peavey). This added more than 900 covered hopper barges to
ACLs existing fleet of inland marine barges.

## RESULTS OF
OPERATIONS

## Quarter Ended
June 29, 2001 Compared with Quarter Ended June 30, 2000

Operating Revenue. Operating
revenue for the quarter ended June 29, 2001 decreased 0.3% to $192.9 million
from $193.5 million for the quarter ended June 30, 2000. The revenue decrease
was primarily due to lower revenue at ACLs marine construction subsidiary,
Jeffboat LLC (Jeffboat), reduced domestic barge freight revenue due
to flooding, reduced demand for liquid freight, the contribution of the barging
operation in Argentina to UABL and the sale of the terminals and communications
operating divisions. The decrease in revenue from these items was partially
offset by increased freight volume from the addition of the Peavey barges,
improved barging freight rates for liquid, bulk and grain commodities and
favorable fuel price adjustments on certain long term, domestic barging
contracts.

Domestic barging revenue
increased $16.2 million to $155.4 million due to the addition of revenue from
the Peavey barges, improved market rates for liquid, bulk and grain commodities
and increased freight rates from contract fuel adjustments. The increased
domestic barging revenue was partially offset by reduced loads per barge due to
flooding that closed the upper Mississippi River from the last week in April,
2001 until the beginning of June, 2001. Liquid barging revenue was also
negatively impacted by reduced demand for caustic soda and styrene freight,
although liquid rates before fuel adjustments remain above second quarter 2000
levels due to term contract renewals.

International revenue
decreased $3.2 million to $8.9 million due to ACLs share of the net earnings from
UABL being reported, net of expenses, as an other income item in 2001 as opposed
to the consolidating of revenue from the Argentine operation in the previous
year second quarter. This was partially offset by charter revenue from UABL in
the second quarter of 2001 and increased revenue in Venezuela due to the
initiation of a terminal operation in the fourth quarter of 2000. Revenue at
Jeffboat decreased $11.3 million to $25.5 million due to no towboat construction
revenue being recognized in the current period as compared to revenue from the
construction of one towboat recognized in the second quarter of 2000 and lower
volume of hopper barge construction, partially offset by an increase in large
tanker barge construction.

Operating Expense.
Operating expense for the quarter ended June 29, 2001 decreased 0.9% to $175.7
million from $177.3 million in the second quarter of 2000. Domestic barging
expense increased $13.7 million to $142.9 million due to increased operating,
barge charter (rent) and depreciation expense from the addition of the Peavey barges
and fuel related increases in towing cost. Domestic barging cost increases were
partially offset by gains on the sales of 4 towboats and a gain on the sale of a
tank barge cleaning facility at Baton Rouge, Louisiana. Fuel price before the
effect of user tax and hedging was 84 cents per gallon in the second quarter of
2001 on a volume of 27.8 million gallons compared to 79 cents per gallon in the
second quarter of 2000. ACL hedges fuel to be consumed for barge freight
commitments that are pre-priced and not protected by contract rate adjustments.
Contract adjustments along with the hedging program protect roughly 80% of
ACLs fuel consumption. International barging expenses decreased $3.1
million to $7.4 million primarily due to expenses associated with ACLs
share of UABLs earnings in the second quarter of 2001 being reported on a
net basis in other income compared to consolidating expense from the Argentine
operation in the second quarter of 2000. The international expense reduction was
partially offset by increased cost in Venezuela from the terminal operation.
Jeffboats expenses decreased $10.8 million to $22.9 million due to no cost
of sales from towboat construction being recognized in the second quarter of
2001 as compared the cost of sales from 1 towboat recognized in the second
quarter of 2000 and due to the lower volume of hopper barges, partially offset by
increased construction of large tank barges.

Operating Income.
Operating income for the quarter ended June 29, 2001 increased $1.1 million to
$17.2 million compared to $16.1 million for the second quarter 2000, due to the
reasons discussed above.

Interest Expense.
Interest expense for the second quarter of 2001 increased to $18.5 million from
$17.7 million for the same period in 2000. The increase is due to a higher
outstanding debt balance on the revolving credit facility, partially offset by a
reduced balance on the term loans and slightly lower interest rates on the
senior credit facility.

Income (Loss) Before
Income Taxes, Extraordinary Item and Cumulative Effect of Accounting Change.
The income before income taxes, extraordinary item and cumulative effect of
accounting change was $0.3 million for the second quarter 2001 compared to loss
of $1.5 million for the same period in 2000 due to the reasons discussed above.

Income Taxes. Income
taxes for the quarter were $0.1 million compared to $0.7 million in the second
quarter of last year. The higher taxes in 2000 were due to accrued foreign taxes
for the international subsidiaries. ACL passes its U.S. federal and state
taxable income to its Parent, whose equity holders are responsible for those
income taxes.

Income (Loss) Before
Extraordinary Item and Cumulative Effect of Accounting Change.The income
before extraordinary item and cumulative effect of accounting change was $0.1
million for the second quarter of 2001 compared to loss of $2.1 million for the
same period in 2000 due to the reasons discussed above.

Extraordinary Item
 Gain (Loss) on Early Extinguishment of Debt.The gain on early
extinguishment of debt was $1.9 million for the second quarter of 2001 compared
to a loss of $0.7 million for the second quarter of 2000. The gain for the second
quarter of 2001 is a result of ACLs purchase in the open market of $5.0
million par value of the ACL Senior Notes for a discount. The loss for the
second quarter 2000 is due to the early redemption premium on certain terminal
revenue refunding bonds (the Terminal Revenue Refunding Bonds).

Net Income (Loss).Net income for the quarterwas $2.0 million compared to loss of $2.9
million in the same period last year due to the reasons discussed above.

## Six Months Ended June 29, 2001 Compared with Six Months Ended June 30, 2000

Operating Revenue.
Operating revenue for the six months ended June 29, 2001 increased 1.4% to
$366.0 million from $360.9 million for the six months ended June 30, 2000. The
revenue increase was primarily due to the addition of the Peavey barges,
improved barging freight rates and favorable fuel price adjustments on certain
long term, domestic barging contracts, partially offset by reduced loads per
barge due to ice and flood delays, lower volume at Jeffboat and reduced demand
for liquid freight.

Domestic barging revenue
increased $24.2 million to $295.7 million due to the addition of revenue from
the Peavey barges, improved barging freight rates for liquid, bulk and grain
commodities and increased freight rates from contract fuel adjustments. The
increased domestic revenue was partially offset by reduced loads per barge due
to severe ice conditions on the Mississippi and Illinois Rivers in the first
quarter of 2001 and the closure of the upper Mississippi River due to flooding
during the second quarter of 2001. Increases in domestic barging revenue were
also partially offset by reduced demand for liquid freight and a reduction in
the contract rate for one of ACLs electric utility customers. Despite
lower demand for liquid freight, liquid freight rates before fuel adjustments
are above the first six months of 2000 levels due to term contract renewals.

International revenues
decreased $0.1 million to $14.8 million due to ACLs share of the net
earnings from UABL being reported, net of expenses, as an other income item in
the first six months of 2001 compared to the consolidating of revenue from the
Argentine operation during the first six months of 2000, partially offset by
charter revenue from UABL in Argentina, payments for minimum contracted tonnage
in Venezuela and the continuance of a new terminal operation in Venezuela, that
began in the fourth quarter of 2000. Revenue at Jeffboat decreased $14.7 million
to $48.9 million primarily due to no towboat construction revenue being
recognized in the first six months of 2001 as compared to revenue from the
construction of one towboat recognized in the first six months of 2000, lower
volume of hopper barge sales and an increase in the number of hoppers completed
for ACLs leasing program on which the profit portion of revenue is
deferred. Tanker barge construction volume at Jeffboat remained steady for the
first six months of 2001 as compared to the first six months of 2000, with increases in large tanker sales mostly offset by a reduction in the sales of smaller tankers.

Operating Expense.
Operating expense for the six months ended June 29, 2001 increased 6.7% to
$359.2 million from $336.8 million in the first six months of 2000. Domestic
barging expense increased $40.9 million to $293.6 million due to increased
operating, barge charter and depreciation expense from the addition of the
Peavey barges, increased fuel price and fuel related increases in towing expense
and increased operating cost associated with flooding on the Mississippi River
and heavy ice on the Mississippi and Illinois Rivers. Fuel price before the
effect of user tax and hedging was 86 cents per gallon in the first six months
of 2001 on a volume of 53.4 million gallons, compared to 77 cents per gallon in
the first six months of 2000. International barging expenses decreased $4.2
million to $14.7 million primarily due to expenses associated with ACLs
share of UABLs earnings in the first six months of 2001 being reported on
a net basis in other income as compared to consolidating expense from the
Argentine operation in the first six months of 2000. The international expense
reduction was partially offset by increased cost in Venezuela from the terminal
operation. Jeffboats expenses decreased $12.1 million to $45.4 million due
to no cost of sales from towboat construction being recognized in the first six
months of 2001 as compared to the cost of sales from one towboat recognized in the
first six months of 2000 and to reduced expenses as a result of the lower volume
of hopper barges.

Operating Income.
Operating income for the six months ended June 29, 2001 decreased $17.3 million
to $6.8 million compared to $24.1 million for the first six months 2000, due to
the reasons discussed above.

Interest Expense.
Interest expense for the first six months of 2001 increased to $38.1 million
from $35.0 million for the same period in 2000. The increase is due to a higher
outstanding debt balance on the revolving credit facility and higher interest
rates during the first quarter of 2001 on the senior credit facility, partially
offset by a reduced balance on the term loans.

Income (Loss) Before
Income Taxes, Extraordinary Item and Cumulative Effect of Accounting Change.
The loss before income taxes, extraordinary item and cumulative effect of
accounting change was $29.2 million for the first six months of 2001 compared to
loss of $9.4 million for the same period in 2000 due to the reasons discussed
above.

Income Taxes. Income
taxes for the six months were $0.3 million compared to $0.8 million in the first
six months of last year. The higher taxes in 2000 were due to accrued foreign
taxes for the international subsidiaries. ACL passes its U.S. federal and state
taxable income to its Parent, whose equity holders are responsible for those
income taxes.

Income (Loss) Before
Extraordinary Item and Cumulative Effect of Accounting Change.The loss
before extraordinary item and cumulative effect of accounting change was $29.5
million for the first six months of 2001 compared to loss of $10.2 million for
the same period in 2000 due to the reasons discussed above.

Extraordinary Item
 Gain (Loss) on Early Extinguishment of Debt.The gain on early
extinguishment of debt was $1.9 million for the first six months of 2001
compared to loss of $0.7 million for the same period in 2000. The gain for the
first six months of 2001 is a result of ACLs purchase in the open market
of $5.0 million par value of the ACL Senior Notes for a discount. The loss for
the first six months of 2000 is due to the early redemption premium on certain
terminal revenue refunding bonds (the Terminal Revenue Refunding
Bonds).

Cumulative Effect of
Accounting Change.The cumulative effect of accounting change was a loss of
$0.5 million for the first six months of 2001 due to recognition of a loss on the fair value
of an interest rate cap as a result of ACLs adoption of FASB Statement No.
133 as of December 30, 2000.

Net Income (Loss).Net loss for the first six months of 2001was $28.1 million compared
to loss of $10.9 million for the same period last year, due to the reasons
discussed above.

## Outlook

ACLs domestic barging
revenue should continue to be ahead of the previous year due to the addition of
the Peavey barges, improved market rates for grain, bulk and liquid commodities
and higher contract rates from fuel price adjustments. The U.S. Department of
Agriculture currently forecast U.S. corn exports of 1.975 billion bushels for
the crop year beginning September 1, 2001, an 8 % increase over the estimate for
the current crop year.

The average price of fuel
consumed by ACBL vessels is expected to remain consistent with current market
prices resulting in a price per gallon in the third quarter of 2001
approximately equal to the price in the third quarter of 2000. With the addition
of boats required to move the Peavey barges, ACBL vessels will consume
approximately 120 million gallons annually and generally ratably throughout the
year. ACBL has barge freight contract price adjustment clauses and a fuel
hedging program which provide protection for approximately 80% of gallons
consumed. Contract adjustments are deferred one quarter.

## Liquidity and
Capital Resources

As of June 29, 2001, ACL
had outstanding indebtedness of $697.4 million, including $326.9 million drawn
under the Term Loans, $75.0 million drawn under the revolving credit facility,
$295.0 million aggregate principal amount of Senior Notes and other notes
outstanding of $0.5 million. In addition, ACL had $2.3 million in outstanding
capital lease obligations and had securitized $54.0 million of the trade
receivables of two subsidiaries as of the end of the quarter.

The Senior Credit
Facilities and the Indenture contain a number of covenants with specified
financial ratios and tests including, with respect to the Senior Credit
Facilities, maximum leverage ratios, rent adjusted maximum leverage ratios and
interest coverage ratios which could lead to an event of default, which could
result in acceleration of the debt, higher interest rates or other adverse
consequences. The Indenture also contains certain cross default provisions.
Compliance with financial ratios is measured at the end of each quarter.
ACLs ability to meet the financial ratios is affected by adverse weather
conditions, seasonality and other risk factors inherent in its business. ACL is
considering refinancing alternatives to the Senior Credit Facilities.

ACLs cash balance was
$30.6 million as of June 29, 2001. Cash used in operating activities totaled
$5.2 million for the first six months of 2001 compared to cash provided by
operating activities of $21.2 million for the first six months of 2000. The
increase in cash used was primarily due to lower operating earnings, partially
offset by a difference in the timing of cash disbursements related to trade
payables.

Capital expenditures are
expected to be $22 million for 2001, with most expenditures being for marine
equipment maintenance. As of June 29, 2001, a total of $9.0 million had been
spent, including $1.5 million for the start of a six barge operation in the
Dominican Republic. ACL will continue to lease new construction equipment from
third parties.

Proceeds of $26.4 million from asset sales, the sale of substantially all of the terminals and the sale of certain minority interests, were used to reduce the outstanding balance under the Term
Loans during the second quarter of 2001.

Management believes that
cash generated from operations is sufficient to fund its cash requirements,
including capital expenditures for fleet maintenance, working capital, interest
payments and scheduled principal payments. ACL may from time to time, borrow
under the Revolving Credit Facility.

## Changes in
Accounting Standards

In June 1998, the Financial
Accounting Standards Board (FASB) issued Statement No. 133,
Accounting for Derivative Instruments and Hedging Activities
(SFAS No. 133). This Statement establishes accounting and reporting
standards for derivative instruments, including certain derivative instruments
embedded in other contracts, and for hedging activities. It requires that an
entity recognizes all derivatives as either assets or liabilities in the
statement of financial position and measure those instruments at fair value. If
certain conditions are met, a derivative may be specifically designated as (a) a
hedge of the exposure to changes in the fair value of a recognized asset or
liability or an unrecognized firm commitment, (b) a hedge of the exposure to
variable cash flows of a forecasted transaction, or (c) a hedge of the foreign
currency exposure of a net investment in a foreign operation, an unrecognized
firm commitment, an available-for-sale security, or a
foreign-currency-denominated forecasted transaction. The accounting for changes
in the fair value of a derivative (that is, gains and losses) depends on the
intended use of the derivative and resulting designation. ACL adopted SFAS No.
133 at the beginning of the first quarter of 2001 with a $0.03 million non-cash
gain to comprehensive income due to purchases of fuel contract futures, a $0.3
million non-cash charge to comprehensive loss to recognize ACLs share of
Global Material Services comprehensive loss on interest rate swaps and a
$0.5 million non-cash charge to Cumulative Effect of Accounting Change for an
interest rate cap.

In September 2000, the FASB
issued Statement of Financial Accounting Standards No. 140, Accounting for
Transfers and Servicing of Financial Assets and Extinguishment of
Liabilities (SFAS No. 140). The Statement is effective for
transfers and servicing of financial assets and extinguishments of liabilities
occurring after March 31, 2001. SFAS No. 140 also includes provisions that
require additional disclosures in the financial statements for fiscal years
ending after December 15, 2000. ACL adopted SFAS No. 140 on April 1, 2001. The
adoption required the consolidation of ACL Funding Corp., a wholly-owned
subsidiary, that was previously treated as a non-consolidated Qualified Special
Purpose Entity. The consolidation resulted in a charge to Retained Earnings of
$989 in the second quarter 2001.

In July 2001, the FASB
issued Statements of Financial Accounting Standards No. 141 Business
Combinations (SFAS No. 141), which provides that all business
combinations should be accounted for using the purchase method of accounting and
establishes criteria for the initial recognition and measurement of goodwill and
other intangible assets recorded in connection with a business combination. The
provisions of SFAS No. 141 apply to all business combinations initiated after
June 30, 2001 and to all business combinations accounted for by the purchase
method that are completed after June 30, 2001. ACL will apply the
provisions of SFAS No. 141 to any future business combinations.

In addition, the FASB
issued Statement of Financial Accounting Standards No. 142 Goodwill and
Other Intangible Assets (SFAS No. 142) which establishes the
accounting for goodwill and other intangible assets following their recognition.
SFAS No. 142 applies to all goodwill and other intangible assets whether
acquired singly, as part of a group, or in a business combination. SFAS No. 142 provides that
goodwill should not be amortized but should be tested for impairment annually
using a fair-value based approach. In addition, SFAS No. 142 provides that
intangible assets other than goodwill should be amortized over their useful
lives and reviewed for impairment in accordance with Statement of Financial
Accounting Standards No. 121, Accounting for the Impairment of Long-Lived
Assets and for Long-Lived Assets to Be Disposed Of. SFAS No. 142 is
effective beginning on January 1, 2002. Upon adoption, ACL will be required to
perform a transitional impairment test under SFAS No. 142 for all goodwill
recorded as of January 1, 2002. Any impairment loss recorded as a result of
completing the transitional impairment test will be treated as a change in
accounting principle. The impact of the adoption of SFAS No. 142 on ACLs
results of operations for all periods beginning on or after January 1, 2002 will
be to eliminate amortization of goodwill. Management of ACL has not performed a
transitional impairment test under SFAS No. 142 and accordingly cannot estimate
the impact of the adoption of SFAS No. 142 as of January 1, 2002.

## Forward
Looking Statements

This Quarterly Report
contains certain forward-looking statements about ACLs financial position
and results of operations. These statements include words such as
believe, expect, anticipate,
intend, estimate or other similar words. Any statements
that express or involve discussions as to expectations, beliefs or plans are not
historical facts and involve known and unknown risks, uncertainties and other
factors that may cause the actual results to materially differ from those
considered by the forward-looking statements. Such factors include:

o        substantial leverage and ability to service debt;

o        changing market, labor, legal and regulatory conditions and trends in the barge and inland shipping industries;

o        general economic and
business conditions, including a prolonged or substantial recession in the
United States or certain international commodity markets such as the market for
grain exports;

o        annual worldwide weather conditions, particularly those affecting North and South America.

As a result of these and
other factors discussed in and incorporated by reference from Risk
Factors, Exhibit 99.1 to ACLs 2000 Annual Report on Form 10-K for
the year ended December 29, 2000, no assurances can be given as to future
results, levels of activity and achievements. Any forward-looking statements
speak only as of the date the statement was made. ACL undertakes no obligation
to update or revise any forward-looking statements.

# ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

There have been no material
changes to ACLs exposure to market risks discussed in Item 7A of
ACLs 2000 Annual report on Form 10-K for the year ended December 29, 2000.

# PART II

# OTHER
INFORMATION

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

Exhibits

There are no exhibits filed with this report.

Reports on Form 8-K

There were no reports on Form 8-K filed in the second quarter of 2001.

# SIGNATURE

Pursuant to the
requirements of the Securities Exchange Act of 1934, American Commercial Lines
LLC has duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.

Date:  August 6, 2001

AMERICAN COMMERCIAL LINES LLC
(Registrant)

By:         /s/ James J. WolffName:         James J. Wolff
Title:            Senior Vice President and
                Chief Financial Officer
                (Principal Accounting Officer)