SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q


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

                       For the quarter ended June 30, 1999


                        Commission File Number: 333-76057

                         RUSSELL-STANLEY HOLDINGS, INC.
               (Exact name of registrant as specified in charter)


<TABLE>
<CAPTION>
<S>   <C>                                     <C>                              <C>

               Delaware                                 3412                       22-3525626
      (State or other jurisdiction of         (Primary Standard Industrial        (IRS Employer
      incorporation or organization)           Classification Code Number)     Identification Number)

</TABLE>


                 685 Route 202/206 Bridgewater, New Jersey   08807
               (Address of principal executive offices)    (Zip code)


                                 (908) 203-9500
              (Registrant's telephone number, including area code)


Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (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 [ ] No [X]

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock, as of the close of the period covered by this report:

            Common Stock, $.01 par value per share: 2,200,764 shares
                  (See Note 16 to Financial Statements included
                    as part of Form S-4, File No. 333-76057)

<PAGE>

                                TABLE OF CONTENTS

                                                                            Page

PART I:  FINANCIAL INFORMATION


ITEM 1:  CONSOLIDATED FINANCIAL STATEMENTS                                     3


ITEM 2:  MANAGEMENT'S DISCUSSION AND ANALYSIS OF
         FINANCIAL CONDITION AND RESULTS OF OPERATIONS                        19


ITEM 3:  QUANTITATIVE AND QUALITATIVE DISCLOSURE
         ABOUT MARKET RISK                                                    25



PART II: OTHER INFORMATION

ITEM 1:  LEGAL PROCEEDINGS                                                    26

ITEM 2:  CHANGES IN SECURITIES                                                26

ITEM 3:  DEFAULTS UPON SENIOR SECURITIES                                      26

ITEM 4:  SUBMISSION OF MATTERS TO A VOTE
         OF SECURITY HOLDERS                                                  26

ITEM 5:  OTHER INFORMATION                                                    26

ITEM 6:  EXHIBITS AND REPORTS ON FORM 8-K                                     26

SIGNATURES                                                                    29





<PAGE>


PART I.  FINANCIAL INFORMATION

ITEM 1.  CONSOLIDATED FINANCIAL STATEMENTS

                 RUSSELL-STANLEY HOLDINGS, INC. AND SUBSIDIARIES
     CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
                                 (In thousands)

<TABLE>
<CAPTION>
                                   Three Months Ended                 Six Months Ended
                                         June 30,                           June 30
                                 ---------------------------------------------------
                                   1999         1998          1999          1998
                                   ----         ----          ----          ----
                                      (Unaudited)                (Unaudited)

<S>                              <C>          <C>          <C>          <C>

NET SALES ....................   $  73,185    $  70,886    $ 144,123    $ 144,156
COST OF SALES ................      56,037       54,984      108,990      111,626
                                 ---------    ---------    ---------    ---------
  Gross Profit ...............      17,148       15,902       35,133       32,530

OPERATING EXPENSES
  Selling ....................       6,088        4,796       11,835        9,780
  General and administrative .       6,548        5,050       12,493       10,445
  Amortization of intangibles          730          865        1,606        1,666
  Non-recurring charges ......           -        1,817            -        3,467
                                 ---------    ---------    ---------    ---------
  Total expenses .............      13,366       12,528       25,934       25,358

INCOME FROM OPERATIONS .......       3,782        3,374        9,199        7,172

INTEREST EXPENSE .............       5,382        3,806        9,978        7,451

OTHER (INCOME) EXPENSE - Net .          86           91          148           87
                                 ---------    ---------    ---------    ---------

LOSS  BEFORE INCOME TAXES
    AND EXTRAORDINARY ITEM ...      (1,686)        (523)        (927)        (366)

INCOME TAX BENEFIT ...........        (499)        (149)        (110)         (85)
                                 ---------    ---------    ---------    ---------

LOSS BEFORE
    EXTRAORDINARY ITEM .......      (1,187)        (374)        (817)        (281)

EXTRAORDINARY ITEM, net of tax           -            -          763            -
                                 ---------    ---------    ---------    ---------

NET  LOSS ....................      (1,187)        (374)      (1,580)        (281)
OTHER COMPREHENSIVE INCOME
     (LOSS) ..................         382         (410)         709         (530)
                                 ---------    ---------    ---------    ---------

COMPREHENSIVE  LOSS ..........   $    (805)   $    (784)   $    (871)   $    (811)
                                 =========    =========    =========    =========

</TABLE>

                 See notes to consolidated financial statements.


<PAGE>



                 RUSSELL-STANLEY HOLDINGS, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                                 (In thousands)

                                                    June 30,    December 31,
                                                      1999         1998
                                                    --------    -----------
                                                  (Unaudited)

ASSETS

CURRENT ASSETS
     Cash ........................................   $  2,742   $  1,630
     Accounts receivable - net ...................     33,677     29,408
     Inventories .................................     22,250     18,761
     Prepaid taxes and income taxes receivable-net      5,419      3,460
     Prepaid expenses and other current assets ...      2,106      2,132
     Deferred tax benefit-net ....................         95        602
                                                     --------   --------

         Total current assets ....................     66,289     55,993
                                                     --------   --------

PROPERTY, PLANT AND EQUIPMENT - Net ..............     94,804     92,643
                                                     --------   --------

OTHER ASSETS:
     Goodwill and other intangibles - net ........    107,599    108,195
     Deferred financing costs - net ..............      6,787      1,294
     Other noncurrent assets .....................        302        129
                                                     --------   --------

         Total other assets ......................    114,688    109,618
                                                     --------   --------

TOTAL ASSETS .....................................   $275,781   $258,254
                                                     ========   ========


                 See notes to consolidated financial statements.


<PAGE>


                 RUSSELL-STANLEY HOLDINGS, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                                 (In thousands)




                                              June 30,  December 31,
                                               1999        1998
                                            ----------- -----------
                                            (Unaudited)
LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
     Accounts payable and accrued expenses   $ 44,841   $ 43,079
     Current maturities of long-term debt        --           10
                                              -------   --------
         Total current liabilities .......     44,841     43,089

LONG TERM DEBT ...........................    188,562    171,592

DEFERRED TAXES - Net .....................      4,758      4,662

OTHER NON CURRENT LIABILITIES ............      5,082      5,374
                                              -------   --------

         Total liabilities ...............    243,243    224,717
                                              -------   --------

STOCKHOLDERS' EQUITY .....................     32,538     33,537
                                              -------   --------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY   $275,781   $258,254
                                             ========   ========


                 See notes to consolidated financial statements.




<PAGE>






                 RUSSELL-STANLEY HOLDINGS, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (In thousands)

<TABLE>
<CAPTION>

                                                                              Six Months Ended
                                                                                   June 30,
                                                                              -----------------
                                                                               1999        1998
                                                                               ----        ----
                                                                                  (Unaudited)
<S>                                                                           <C>       <C>

CASH FLOWS FROM OPERATING ACTIVITIES:
     Net  loss .........................................................   $ (1,580)   $   (281)
     Adjustments to reconcile net loss to
        net cash  provided by operating activities:
           Depreciation and amortization ...............................     14,794      13,380
           Extraordinary item ..........................................      1,271           -
           Non-recurring charges .......................................          -       3,467
Changes in operating assets and liabilities:
     Decrease (increase) in accounts receivable ........................     (4,269)       (564)
     Decrease (increase) in inventories ................................     (3,489)      1,776
     Decrease (increase) in prepaid taxes and other
           current assets ..............................................     (1,932)        285
     Increase (decrease) in accounts payable and .......................        624      (3,244)
           accrued expenses
     Increase (decrease) in deferred income taxes ......................        603      (1,263)
     Increase (decrease) in other - net ................................       (497)       (679)
                                                                             --------   --------

        Net cash provided by operating activities ......................      5,525      12,877
                                                                             --------   --------

CASH FLOWS FROM  INVESTING ACTIVITIES:
       Capital expenditures ............................................    (14,860)    (11,999)
                                                                             --------   --------

            Net cash used in investing activities ......................    (14,860)    (11,999)
                                                                           --------    --------

CASH FLOWS FROM  FINANCING ACTIVITIES:
      Proceeds (repayments) from long-term borrowings, net .............     44,058        (143)
      Proceeds (repayments) from revolving credit loan, net ............    (27,087)      2,243
      Cash paid for financing costs ....................................     (7,116)          -
      Other ............................................................       (117)       (232)
                                                                            --------   --------
          Net cash provided by financing
              activities ...............................................      9,738       1,868
                                                                            --------   --------
EFFECT OF EXCHANGE RATE CHANGES ON CASH ................................        709         530
                                                                            --------   --------
NET CHANGE IN CASH .....................................................      1,112       3,276

CASH, BEGINNING OF PERIOD ..............................................      1,630       1,051
                                                                           ---------   --------

CASH, END OF PERIOD ....................................................   $  2,742    $  4,327
                                                                           ========    ========
</TABLE>

                 See notes to consolidated financial statements


<PAGE>

                 RUSSELL-STANLEY HOLDINGS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



NOTE 1  - BASIS OF PRESENTATION

         These consolidated financial statements and related notes thereto as of
June 30, 1999 and for each of the three month and six month  periods  ended June
30, 1999 and 1998 are unaudited.

         The information furnished herein reflects all adjustments which are, in
the opinion of management, necessary for a fair presentation of the consolidated
balance  sheets as of June 30, 1999 and  December  31,  1998,  the  consolidated
statements of operations  and  comprehensive  income for the three month and six
month periods ended June 30, 1999 and 1998 and the  statements of cash flows for
the six month periods ended June 30, 1999 and 1998. The preparation of financial
statements in conformity with generally accepted accounting  principles requires
management  to make certain  estimates and  assumptions  that affect the amounts
reported on the financial  statements and accompanying the notes. Actual amounts
could differ from those estimates.  Certain items in 1998 have been reclassified
to conform to the 1999 presentation.

         These  financial  statements  should  be read in  conjunction  with the
financial  statements and notes thereto  included in  Russell-Stanley  Holdings,
Inc.'s (the "Company's") Registration Statement on Form S-4, File No.
333-76057.


NOTE 2  - RECENTLY ISSUED ACCOUNTING STANDARD

         In June 1998,  Statement of  Financial  Accounting  Standards  No. 133,
Accounting for Derivative  Instruments and Hedging  Activities  ("SFAS 133") was
issued.  SFAS 133  establishes  new  disclosure  requirements  which  provide  a
comprehensive  standard for  recognition  and  measurement  of  derivatives  and
hedging  activities.  SFAS 133 will  take  effect in 2001 and will  require  new
disclosures,  all derivatives to be recorded on the balance sheet at fair value,
and establish special accounting for certain types of hedging activities.  Based
on the  Company's  current  derivatives,  an  interest  rate  collar and foreign
currency forward contracts,  management does not believe that SFAS 133 will have
a material effect on the Company's financial condition or results of operations.

NOTE 3  - INVENTORIES

         Inventories consist of the following:

                                                 June 30,           December 31,
                                                   1999                 1998
                                                (Unaudited)
                                                -----------          ---------
                                                          (In thousands)
     Raw material                               $ 13,198             $ 11,380
     Work-in-process                               1,767                1,617
     Finished goods                                7,285                5,764
                                                  -------            --------
                                                $ 22,250             $ 18,761
                                                 =======              =======
<PAGE>


NOTE 4 - LONG-TERM DEBT
         Long-term debt consists of the following:
                                                   June 30,         December 31,
                                                    1999               1998
                                                 (Unaudited)
                                                 -----------        ------------
                                                          (In thousands)
     Senior subordinated notes                   $148,912             $   -
     Revolving credit loan and term loans          39,650               171,591
     Capital lease obligations                        -                      11
                                                 --------             ----------
                                                  188,562               171,602
     Less current maturities                          -                      10
                                                 --------             ----------
     Long-term debt                              $188,562              $171,592
                                                 =========             =========

     On February 10, 1999, the Company  refinanced its revolving credit loan and
term loans by amending its senior credit facility to provide for a $75.0 million
revolving  credit line (including a $15.0 million  Canadian credit line),  which
bears interest,  at the Company's election,  at a combination of domestic source
and Eurodollar borrowing rates which fluctuate based on the Company's EBITDA and
debt  levels,  and  a  $25.0  million  term  loan,  bearing  interest  at  9.48%
(collectively,  the "Senior Credit  Facility").  The revolving  credit  facility
matures in February 2004 and the term loan matures in two equal  installments in
June 2006 and 2007.  In  addition,  the Company  issued $150  million of 10 7/8%
Senior  Subordinated  Notes (the  "Notes")  due  February  15,  2009,  issued at
99.248%,  resulting in an effective  yield of 11.0%.  The Senior Credit Facility
contains certain  covenants and restrictions and is secured by substantially all
assets of the Company. The Notes require semiannual interest payments commencing
August 15,  1999 and mature  February  2009.  The Notes are  subordinate  to all
existing and future senior  indebtedness of the Company and are  unconditionally
guaranteed  by the  domestic  subsidiaries  and  contain a number  of  customary
covenants and restrictions.  Deferred  financing  charges of approximately  $7.1
million were incurred in connection with the refinancing.

     The  Notes,  revolving  credit  loan,  and term  loans  have the  following
provisions (dollars in thousands):

<TABLE>
<CAPTION>

                                                        Interest                        Interest
                                                        Rate at      Balance at          Rate at       Balance at
                  Domestic             Eurodollar       June 30,        June 30,     December 31,    December 31,
                Interest Rate         Interest Rate        1999            1999             1998             1998
                 --------------       -------------     ---------     ---------      -----------     ------------
                                                       (Unaudited)   (Unaudited)
<S>               <C>                 <C>               <C>           <C>            <C>             <C>


Revolving         Prime plus margin   LIBOR plus margin
credit            not less            not less          9.00%       $   5,424        9.00%            $  22,837
loan              than 1.25%          than
                                      2.75%
Revolving         Canadian   prime
credit            plus
loan -            margin not              -             8.00            9,226             -                -
foreign           less
                  than 1.25%

Term Loan A -     Prime plus margin   LIBOR plus margin
Domestic          not less            not less            -             -          9.00                   35,000
                  than                than
                  1.00%               2.50%

Term Loan A -     Prime plus margin   LIBOR plus margin
Foreign           not less            not less            -             -          9.00                   9.182
                  than                than
                  1.00%               2.50%

Term Loan B -     Prime plus margin   LIBOR plus margin
                  not less            not less            -             -           9.50                  79,572
                  than                than
                  1.50%               3.00%

Term Loan C -     Fixed rate          Fixed rate        9.48       25,000           9.48                  25,000

Senior
Subordinated
Notes             Fixed rate                -          10.88      148,912              -                       -
                                                                  -------                                --------
Total                                                            $188,562                               $171,591
                                                                  ========                              =========

</TABLE>

<PAGE>

Maturities of long-term debt
                                                                  (In thousands)
       2004                                                         $  14,650
       2005 and thereafter                                            173,912
                                                                      -------
         Total                                                      $ 188,562
                                                                     =========

NOTE 5 - STOCKHOLDERS' EQUITY

<TABLE>
<CAPTION>

                                                       June 30,          December 31,
                                                         1999                1998
                                                       --------          -----------
                                                     (Unaudited)
                                                                (In thousands)
<S>                                                    <C>                  <C>

Common Stock, $.01 par value,
    At June 30, 1999 and December 31, 1998,
    3,000,000 shares were authorized; 2,201,000
    and 2,205,000 shares were issued and out-
    standing at June 30, 1999 and December 31,
     1998, respectively                                 $     23           $       23
Accumulated paid in capital                               70,179               70,179
Accumulated deficit                                      (30,849)             (29,270)
Accumulated other comprehensive income                    (1,769)              (2,478)
Less:   Notes receivable for shares issued to
  management                                                 (13)                 (64)
     Treasury stock                                       (5,033)              (4,853)
                                                         --------             --------
TOTAL STOCKHOLDERS' EQUITY                             $  32,538            $  33,537
                                                         ========             ========

</TABLE>


NOTE 6 - EXTRAORDINARY ITEM

         The Company used a portion of the proceeds from the debt refinancing to
repay its existing debt. As a result of this early  extinguishment  of debt, the
Company incurred an extraordinary charge in February 1999 totaling approximately
$763,000,  net of tax  benefits,  consisting  of the  write-off  of  unamortized
deferred financing costs.


NOTE 7 - COMPREHENSIVE INCOME (LOSS)

         The Company has adopted  Statement  of Financial  Accounting  Standards
("SFAS") No. 130, "Reporting  Comprehensive  Income." Other comprehensive income
(loss)  consists of foreign  currency  translation  adjustments  for each of the
three month and six month periods ended June 30, 1999 and 1998.

<PAGE>

NOTE 8 - CONTINGENCY

         In January 1999, the U.S.  Environmental  Protection Agency (the "EPA")
confirmed  the  presence of  contaminants,  including  dioxin,  in and along the
Woonasquatucket River in Rhode Island. Prior to 1970, New England Container Co.,
Inc. ("NEC") operated a facility in North  Providence,  Rhode Island,  along the
Woonasquatucket River at a site where contaminants have been found. Recent press
reports   identify  NEC  as  a  business  that  may  have   contributed  to  the
contamination.  On  September  15,  1999,  NEC  received  a letter  from the EPA
asserting that NEC is a potentially responsible party.  Notwithstanding that NEC
no longer  operates the  facility,  and did not operate the facility at the time
the Company  acquired the  outstanding  capital  stock of NEC in July 1998,  NEC
could incur  liability  under federal and state  environmental  laws and/or as a
result of civil litigation. The Company believes that any resulting liability is
subject  to a  contractual  indemnity  from  Vincent  J.  Buonanno,  one  of its
directors and the former owner of NEC.  However,  such indemnity is subject to a
$2.0 million limit.  The Company is currently  unable to estimate the likelihood
or extent of any liability;  however, this matter may result in liability to NEC
that could have a material adverse effect on the Company's  financial  condition
and results of operations.

NOTE 9 - SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

                                                             Six Months Ended
                                                                  June 30,
                                                            --------------------

               Cash paid during the period for:             1999           1998
                                                           -----           ----

                           Interest                        $6,506        $7,465
                                                            =====         =====
                           Income Taxes                    $1,614        $  402
                                                            =====         ======


NOTE 10 - GUARANTOR SUBSIDIARIES

         The  Company's   payment   obligations   under  the  Notes  are  fully,
unconditionally,  jointly  and  severally  guaranteed  by its  current  domestic
subsidiaries,  principally:  Russell-Stanley Corp. ("RSC"), Container Management
Services ("CMS"), and NEC (collectively, the "Guarantor Subsidiaries").  Each of
the Guarantor  Subsidiaries is a direct or indirect  wholly-owned  subsidiary of
the  Company.  The  Company's  payment  obligations  under the Notes will not be
guaranteed by the remaining  subsidiary,  Hunter Drums Limited  ("Hunter")  (the
"Non-Guarantor Subsidiary").  The obligations of each Guarantor Subsidiary under
their guarantee of the Notes are subordinated to each  subsidiary's  obligations
under their guarantee of the Senior Credit Facility.

         Presented below is condensed  combining  financial  information for the
Parent Company, the Guarantor Subsidiaries and the Non-Guarantor  Subsidiary. In
the Company's  opinion,  separate  financial  statements  and other  disclosures
concerning  each of the  Guarantor  Subsidiaries  would not  provide  additional
information that is material to investors. Therefore, the Guarantor Subsidiaries
are combined in the presentation below.

         Investments  in  subsidiaries  are  accounted for by the Company on the
equity method of accounting.  Earnings of subsidiaries are, therefore, reflected
in the Company's  investments in and advances to/from  subsidiaries  account and
earnings   (losses).   The   elimination   entries   eliminate   investments  in
subsidiaries,  related  stockholders' equity and other intercompany balances and
transactions.



                 RUSSELL-STANLEY HOLDINGS, INC. AND SUBSIDIARIES
          SUPPLEMENTAL CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS
                    FOR THE THREE MONTHS ENDED JUNE 30, 1999
                                 (In Thousands)
                                   (Unaudited)
<TABLE>
<CAPTION>

                                       Parent       Guarantor      Non-Guarantor
                                      Company     Subsidiaries       Subsidiary      Eliminations     Consolidated
                                     -----------  --------------  -----------------  --------------  ----------------
<S>                                  <C>               <C>                   <C>         <C>            <C>

NET SALES                            $      -           $63,620             $9,565      $    -           $   73,185

COST OF SALES                               -           49,304               6,733           -               56,037
                                     --------         ---------           --------      --------          ---------

GROSS PROFIT                                -           14,316               2,832           -               17,148

TOTAL EXPENSES                              -           11,657               1,709           -               13,366
                                     --------         ---------           --------      --------          ---------

INCOME FROM OPERATIONS                      -            2,659               1,123           -                3,782

EQUITY  LOSS                             (922)              -                  -            922               -

INTEREST EXPENSE                          544            4,494                 344           -                5,382

OTHER (INCOME) EXPENSE - Net                -              155                 (69)          -                   86
                                     --------         ---------           --------      --------          ---------

INCOME (LOSS) BEFORE
         INCOME TAXES                  (1,466)         (1,990)                848          922              (1,686)

PROVISION (BENEFIT) FOR
         INCOME TAXES                    (279)           (594)                 74           -                 (499)
                                     --------         ---------           --------      --------          ---------

NET INCOME (LOSS)                   $  (1,187)      $  (1,396)           $    474     $    922          $   (1,187)
                                     =========        =========           ========      ========          =========


<PAGE>

</TABLE>

                 RUSSELL-STANLEY HOLDINGS, INC. AND SUBSIDIARIES
          SUPPLEMENTAL CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS
                    FOR THE THREE MONTHS ENDED JUNE 30, 1998
                                 (In Thousands)
                                   (Unaudited)
<TABLE>
<CAPTION>

                                       Parent       Guarantor      Non-Guarantor
                                      Company     Subsidiaries       Subsidiary      Eliminations     Consolidated
                                     -----------  --------------  -----------------  --------------  ---------------
<S>                                  <C>           <C>                <C>             <C>                 <C>


NET SALES                            $    -        $     61,253       $     9,633      $   -            $  70,886

COST OF SALES                             -              48,139             6,845      $   -              54,984
                                     -----------      ------------     -----------      -----------      --------

GROSS PROFIT                              -              13,114             2,788          -              15,902

TOTAL EXPENSES                            -              10,999             1,529          -               12,528
                                     -----------      ------------     -----------      -----------      --------
INCOME FROM OPERATIONS                    -               2,115             1,259          -                3,374

EQUITY LOSS                                (11)             -                  -           11                 -

INTEREST EXPENSE                           537            2,944               325           -               3,806

OTHER (INCOME)
         EXPENSE - Net                       -             (27)               118           -                  91
                                     -----------      ------------     -----------      -----------      --------
INCOME (LOSS) BEFORE
         INCOME TAXES                     (548)           (802)               816          11                (523)

PROVISION (BENEFIT) FOR
         INCOME TAXES                     (174)           (208)               233           -                (149)
                                     -----------      ------------     -----------      -----------      --------
NET INCOME (LOSS)                    $    (374)      $    (594)     $         583     $     11       $       (374)
                                     ===========     =============     ===========      ===========      =========

</TABLE>



<PAGE>
<TABLE>
<CAPTION>


                RUSSELL-STANLEY HOLDINGS, INC. AND SUBSIDIARIES
          SUPPLEMENTAL CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS
                     FOR THE SIX MONTHS ENDED JUNE 30, 1999
                                 (In Thousands)
                                  (Unaudited)

                                       Parent       Guarantor      Non-Guarantor
                                      Company     Subsidiaries       Subsidiary      Eliminations     Consolidated
                                     -----------  --------------  -----------------  --------------  ---------------
<S>                                  <C>               <C>              <C>            <C>                <C>


NET SALES                            $   -             $125,719         $   18,404     $    -              $144,123

COST OF SALES                            -              95,714              13,276          -               108,990
                                     -----------  ---------------  ----------------    ------------  --------------
GROSS PROFIT                             -              30,005               5,128          -                35,133
TOTAL EXPENSES                           -              22,923               3,011          -                25,934
                                     -----------  ---------------  ----------------    ------------  --------------
INCOME FROM OPERATIONS                   -               7,082               2,117          -                 9,199

EQUITY LOSS                            (167)               -                  -             167                 -

INTEREST EXPENSE                      1,034              8,284                 660          -                 9,978

OTHER (INCOME)
         EXPENSE - Net                   -                 260                (112)         -                   148
                                     -----------  ---------------  ----------------    ------------  --------------
INCOME (LOSS) BEFORE
         INCOME TAXES                   (1,201)         (1,462)              1,569          167                (927)

PROVISION (BENEFIT) FOR
         INCOME TAXES                     (384)           (429)                703           -                (110)
                                     -----------  ---------------  ----------------    ------------  --------------
INCOME (LOSS) BEFORE                      (817)         (1,033)                866          167               (817)
         EXTRAORDINARY ITEM

EXTRAORDINARY ITEM,                         763            -                    -            -                 763
   Net of tax                        -----------  ---------------  ----------------    ------------  --------------

NET INCOME (LOSS)                     $ (1,580)       $ (1,033)        $       866     $       167       $  (1,580)
                                     ===========  ==============   ===============    ============ ================

</TABLE>


<PAGE>
<TABLE>
<CAPTION>


                 RUSSELL-STANLEY HOLDINGS, INC. AND SUBSIDIARIES
          SUPPLEMENTAL CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS
                     FOR THE SIX MONTHS ENDED JUNE 30, 1998
                                 (In Thousands)
                                   (Unaudited)

                                       Parent       Guarantor      Non-Guarantor
                                      Company     Subsidiaries       Subsidiary      Eliminations     Consolidated
                                     -----------  --------------  -----------------  --------------  ---------------

<S>                                  <C>            <C>            <C>                <C>                 <C>

NET SALES                            $   -          $   124,961    $     19,195       $   -               $ 144,156

COST OF SALES                            -               97,519          14,107           -                 111,626
                                     -----------  ---------------  ----------------    ------------  --------------
GROSS PROFIT                             -               27,442           5,088           -                  32,530

TOTAL EXPENSES                           -               22,451           2,907           -                  25,358
                                     -----------  ---------------  ----------------    ------------  --------------
INCOME FROM OPERATIONS                   -                4,991           2,181           -                   7,172

EQUITY INCOME                           429                 -               -           (429)                   -

INTEREST EXPENSE                      1,063               5,719             669           -                   7,451

OTHER (INCOME)
         EXPENSE - Net                   -                  (31)            118           -                      87
                                     -----------  ---------------  ----------------    ------------  --------------
INCOME (LOSS) BEFORE
         INCOME TAXES                 (634)                (697)          1,394         (429)                  (366)

PROVISION (BENEFIT) FOR
         INCOME TAXES                 (353)                (247)            515           -                     (85)
                                     -----------  ---------------  ----------------    ------------  --------------

NET INCOME (LOSS)                    $(281)        $       (450)      $     879        $(429)           $      (281)
                                     ===========  ===============  ================    ============  ==============


</TABLE>

<PAGE>
<TABLE>
<CAPTION>

                 RUSSELL-STANLEY HOLDINGS, INC. AND SUBSIDIARIES
               SUPPLEMENTAL CONDENSED CONSOLIDATING BALANCE SHEET
                                  JUNE 30, 1999
                                 (In Thousands)
                                   (Unaudited)

                                       Parent       Guarantor      Non-Guarantor
                                      Company     Subsidiaries       Subsidiary      Eliminations     Consolidated
                                     -----------  --------------  -----------------  --------------  ---------------
                                                                         ASSETS
<S>                                  <C>             <C>                <C>              <C>             <C>

CURRENT ASSETS:
         Cash                        $    -            $ 2,480          $      -         $    262        $    2,742
         Accounts receivable - net        -             29,347               4,330              -            33,677
         Inventories                      -             18,676               3,386            188            22,250
         Prepaid and other current
           assets - net                   -              7,351                 269              -             7,620
                                     ---------      ----------           ---------        --------        ---------
                  Total current assets    -             57,854               7,985            450            66,289
                                     ---------      ----------           ---------        --------        ---------
PROPERTY, PLANT AND
         EQUIPMENT - Net                  -             88,785               6,019             -             94,804
                                     ---------      ----------           ---------        --------        ---------

OTHER ASSETS:
         Goodwill and other
           intangibles - net              -             89,633              17,966            -             107,599
         Deferred financing costs - net   -              6,787                  -             -               6,787
         Other noncurrent assets          -                302                  -             -                 302
         Intercompany advances          20,423          17,641                 412        (38,476)               -
         Investment in subsidiaries     37,629             -                    -         (37,629)               -
                                     ---------      ----------           ---------        --------        ---------
TOTAL ASSETS                         $  58,052       $ 261,002          $   32,382     $  (75,655)         $275,781
                                     =========      ==========           =========       =========       ==========


                      LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
         Accounts payable and
           accrued expenses           $ (2,121)      $  43,251         $     3,805     $      (94)        $  44,841
         Current maturities of
           long-term debt                  -               -                    -               -               -
                                     ---------      ----------           ---------        --------        ---------
         Total current liabilities      (2,121)         43,251               3,805            (94)           44,841
                                     ---------      ----------           ---------        --------        ---------
LONG-TERM DEBT                          19,997         159,339               9,226              -           188,562
DEFERRED TAXES - Net                      (916)          3,342               2,332              -             4,758
OTHER NONCURRENT
         LIABILITIES                       -             3,838               1,244              -             5,082
                                     ---------      ----------           ---------        --------        ---------
         Total liabilities              16,960         209,770              16,607            (94)          243,243
                                     ---------      ----------           ---------        --------        ---------
INTERCOMPANY ADVANCES                      -            30,205               7,173        (37,378)              -
TOTAL STOCKHOLDERS'
         EQUITY                         41,092          21,027               8,602        (38,183)           32,538
                                     ---------      ----------           ---------        --------        ---------
TOTAL LIABILITIES AND
         STOCKHOLDERS' EQUITY          $58,052        $261,002            $ 32,382       $(75,655)         $275,781
                                     =========      ==========           =========        ========        ---------
</TABLE>

<PAGE>

<TABLE>
<CAPTION>




                 RUSSELL-STANLEY HOLDINGS, INC. AND SUBSIDIARIES
               SUPPLEMENTAL CONDENSED CONSOLIDATING BALANCE SHEET
                                DECEMBER 31, 1998
                                 (In Thousands)
                                   (Unaudited)


                                       Parent       Guarantor      Non-Guarantor
                                      Company     Subsidiaries       Subsidiary      Eliminations     Consolidated
                                     -----------  --------------  -----------------  --------------  ---------------
<S>                                  <C>            <C>                  <C>               <C>            <C>
                                                                         ASSETS
CURRENT ASSETS:

         Cash                         $   -         $    1,246           $     384         $    -         $   1,630
         Accounts receivable - net        -             26,263               3,226            (81)           29,408
         Inventories                      -             16,354               2,407              -            18,761
         Prepaid and other current
           assets - net                   -              2,412                 398          3,384             6,194
                                     ---------      ----------           ---------        --------        ---------
            Total current assets          -             46,275               6,415          3,303            55,993
                                     ---------      ----------           ---------        --------        ---------
PROPERTY, PLANT AND
         EQUIPMENT - Net                  -             86,720               5,923             -             92,643
                                     ---------      ----------           ---------        --------        ---------

OTHER ASSETS:
         Goodwill and other
           intangibles - net              -             91,869              17,570         (1,244)          108,195
         Deferred financing costs        1,294             -                    -             -               1,294
            - nets
         Other noncurrent assets          -                129                  -             -                129
         Intercompany advances          21,434          76,033                 390        (97,857)               -
         Investment in subsidiaries     37,788              -                   -         (37,788)               -
                                     ---------      ----------           ---------        --------        ---------
TOTAL ASSETS                         $  60,516       $ 301,026        $     30,298   $   (133,586)        $ 258,254
                                     =========      ==========           =========        ========        =========


                                                          LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
         Accounts payable and
            accrued expenses          $ (2,149)      $ 37,767         $     4,336       $   3,125        $  43,079
         Current maturities of
            long-term debt                -                10                   -             -                 10
                                     ---------      ----------           ---------        --------        ---------
         Total current liabilities      (2,149)        37,777               4,336          3,125            43,089
                                     ---------      ----------           ---------        --------        ---------

LONG-TERM DEBT                          19,997         142,413               9,182            -             171,592
DEFERRED TAXES - Net                      -              2,331               2,331            -               4,662
OTHER NONCURRENT
         LIABILITIES                      -              4,714               1,410          (750)             5,374
                                     ---------      ----------           ---------        --------        ---------
         Total liabilities              17,848         187,235              17,259          2,375           224,717
                                     ---------      ----------           ---------        --------        ---------
INTERCOMPANY ADVANCES                     -             90,252               6,790        (97,042)             -
TOTAL STOCKHOLDERS'
         EQUITY                         42,668          23,539               6,249        (38,919)           33,537
                                     ---------      ----------           ---------        --------        ---------
TOTAL LIABILITIES AND
         STOCKHOLDERS' EQUITY        $  60,516      $  301,026           $  30,298     $ (133,586)        $ 258,254
                                     =========      ==========           =========        ========        ---------

</TABLE>



<PAGE>

<TABLE>
<CAPTION>

                RUSSELL-STANLEY HOLDINGS, INC. AND SUBSIDIARIES
          SUPPLEMENTAL CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
                     FOR THE SIX MONTHS ENDED JUNE 30, 1999
                                 (In Thousands)
                                  (Unaudited)

                                         Parent         Guarantor       Non-Guarantor
                                        Company       Subsidiaries       Subsidiary       Eliminations    Consolidated
                                      -------------  ----------------  ----------------  ---------------  --------------
<S>                                   <C>                <C>               <C>                 <C>           <C>

CASH FLOWS PROVIDED BY
         OPERATING ACTIVITIES:
         Net (loss) income            $    (1,580)      $    (1,033)       $      866          $   167       $  (1,580)
         Adjustments to reconcile
           net (loss) income to
           net cash provided by
           (used in) operating
           activities:
           Equity loss                        167                -                 -              (167)             -

           Depreciation and
             amortization                      23            14,090               681                -          14,794

           Extraordinary item               1,271                -                 -                 -           1,271

           Changes in
             operating assets
             and liabilities                 (892)           (5,819)           (2,249)               -          (8,960)
                                          ---------        ----------         ---------          --------      ---------
           Net cash provided
             by (used in)
             operating activities          (1,011)            7,238              (702)               -           5,525
                                          ---------        ----------         ---------          --------      ---------
CASH FLOWS USED IN
  INVESTING ACTIVITIES                         -            (14,384)             (476)               -         (14,860)
                                          ---------        ----------         ---------          --------      ---------
CASH FLOWS PROVIDED
  BY FINANCING ACTIVITIES                   1,011             8,642                85                -           9,738
                                          ---------        ----------         ---------          --------      ---------
EFFECT OF EXCHANGE RATE
  CHANGES ON CASH                               -                 -               709                -             709
                                          ---------        ----------         ---------          --------      ---------
NET CHANGE IN CASH                              -             1,496              (384)               -           1,112

CASH, BEGINNING OF PERIOD                       -             1,246               384                -           1,630
                                          ---------        ----------         ---------          --------      ---------
CASH, END OF PERIOD                       $     -         $   2,742           $     -           $    -        $  2,742
                                          =========        ==========         =========          ========      =========

</TABLE>


<PAGE>

<TABLE>
<CAPTION>



                 RUSSELL-STANLEY HOLDINGS, INC. AND SUBSIDIARIES
          SUPPLEMENTAL CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
                     FOR THE SIX MONTHS ENDED JUNE 30, 1998
                                 (In Thousands)
                                   (Unaudited)

                                       Parent       Guarantor      Non-Guarantor
                                      Company     Subsidiaries       Subsidiary      Eliminations     Consolidated
                                     -----------  --------------  -----------------  --------------  ---------------
<S>                                <C>          <C>                 <C>                <C>             <C>

CASH FLOWS PROVIDED BY
  OPERATING ACTIVITIES:

  Net (loss) income                $   (281)    $   (450)           $   879            $   (429)       $   (281)

  Adjustments to reconcile
    net (loss) income to
    net cash provided by
    (used in) operating
    activities:
    Equity income                     (429)             -               -                   429              -

    Depreciation and
      amortization                     138        12,503                 739                  -           13,380

    Non-recurring charges                 -        3,467                 -                    -            3,467

    Changes in
      operating assets
      and liabilities                (356)        (1,416)              (1,917)                -           (3,689)
                                  ---------      -----------       -----------         ----------       ---------
    Net cash provided by
    (used in)
    operating activities             (928)        14,104                (299)                 -          12,877
                                  ---------      -----------       -----------         ----------       ---------
CASH FLOWS USED IN
    INVESTING ACTIVITIES               -         (11,552)               (447)                 -         (11,999)
                                  ---------      -----------       -----------         ----------       ---------
CASH FLOWS PROVIDED BY (USED IN)
  FINANCING ACTIVITIES               928             946                  (6)                 -           1,868
                                  ---------      -----------       -----------         ----------       ---------
EFFECT OF EXCHANGE RATE
  CHANGES ON CASH                      -              -                  530                  -             530
                                  ---------      -----------       -----------         ----------       ---------
NET CHANGE IN CASH                     -          3,498                 (222)                 -           3,276

CASH, BEGINNING OF PERIOD              -            829                  222                  -           1,051
                                  ---------      -----------       -----------         ----------       ---------
CASH, END OF PERIOD               $    -        $ 4,327            $      -             $     -        $  4,327
                                  =========      ===========       ===========         ==========       =========
</TABLE>

<PAGE>

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

Three Month Period Ended June 30, 1999 Compared to Three Month Period Ended June
30, 1998

Net Sales

     Net sales  increased  3.2% to $73.2  million in 1999 from $70.9  million in
1998. Our container manufacturing division's net sales declined approximately 8%
to $56.2 million in 1999,  from $60.9 million in 1998,  due primarily to selling
price declines in response to lower raw material  prices and reduced demand from
cyclical export  markets.  Net sales in our services  division  increased 70% to
$17.0  million  in 1999 from  $10.0  million in 1998 due to the net sales of New
England  Container  which was  acquired in July 1998 and growth in  intermediate
bulk  container  ("IBC")  leasing.  Excluding  the  impact  of the  New  England
Container acquisition, our services division's net sales increased approximately
15%, despite lower selling prices in response to competitive pressures.

Gross Profit

     Gross profit  increased  $1.2  million to $17.1  million in 1999 from $15.9
million in 1998, primarily from the benefit of lower raw material prices and the
net sales  increase  in  services.  Gross  profit as a  percentage  of net sales
improved  to 23.4% in 1999 from  22.4% in 1998.  Favorable  raw  material  price
trends,  productivity  improvements in containers,  and the mix shift within our
services  division  more  than  offset  the  effect  of lower  prices  and lower
container sales volume.

Selling, General and Administrative Expenses

     Selling,  general and administrative  expenses as a percentage of net sales
increased to 18.3% in 1999 from 15.1% in 1998  primarily due to  investments  in
our services  infrastructure,  the acquisition of New England Container, and the
recording of a legal settlement provision and associated professional fees.

Non-Recurring Charges

     In conjunction  with the integration of acquired  entities and expansion of
our  operations,  a plan was developed to  rationalize  our operations and sales
force and  consolidate  and  relocate  our  corporate  headquarters  in order to
improve  operating  efficiencies and reduce costs. This plan began in March 1998
and was  substantially  completed  during the first  quarter of 1999. As part of
this  plan  we  recorded  restructuring,   integration,  and  other  charges  of
approximately  $1.8  million for the three  months  ended June 30,  1998.  These
charges   primarily  include  costs  related  to  the  closure  of  a  container
manufacturing  facility,  severance costs and other personnel related costs, the
relocation of corporate headquarters,  and other miscellaneous costs. We did not
record any non-recurring charges for the quarter ended June 30, 1999.

Income from Operations

     Income from  operations  increased  by $0.4 million to $3.8 million in 1999
from $3.4 million in 1998 as a result of the factors described above.


Other (Income) Expense, Net

     Other (income)  expense,  net, which includes  changes in the fair value of
foreign exchange contracts, decreased slightly in 1999 compared to 1998.

Interest Expense

     Interest  expense was $5.4  million in 1999  compared  with $3.8 million in
1998.  The increase in interest  expense is the result of increased  debt levels
associated with the acquisition of New England  Container and the refinancing of
our  revolving  credit  loan and term  loans and the senior  subordinated  notes
offering in February 1999.

Loss Before Income Taxes

     In 1999,  the loss before income taxes was $1.7 million versus $0.5 million
in 1998, as a result of the factors described above.


Income Tax Benefit

     The effective tax rate  (benefit) on income was (29.6)% in 1999 and (28.5)%
in 1998,  both  lower  than the  statutory  federal  income  tax rate due to the
non-deductible  portion of goodwill  associated with our acquisitions and higher
foreign income taxes.

Net Loss

     In 1999,  the net loss was $1.2 million  versus $0.4 million in 1998,  as a
result of the factors described above.

Six Month Period Ended June 30, 1999 compared to Six Month Period Ended June 30,
1998.

Net Sales

     Net sales decreased  slightly to $144.1 million in 1999 from $144.2 million
in 1998. Our container manufacturing division's net sales declined approximately
10% to $112.2  million in 1999,  from $124.5  million in 1998,  due primarily to
selling  price  declines in response to lower raw material  prices  coupled with
competitive  pressures  and unit volume  decreases  due to some share  shifts in
steel  containers  and lack of demand  from  export  segments.  Net sales in our
services  division  increased  approximately  62% to $31.9  million in 1999 from
$19.7 million in 1998 due to the net sales of New England  Container,  which was
acquired in July 1998,  and growth in IBC leasing.  Excluding  the impact of the
New England  Container  acquisition,  services  division's  net sales  increased
approximately  11% despite  lower  selling  prices in  response  to  competitive
pressures.

Gross Profit

     Gross profit  increased  $2.6  million to $35.1  million in 1999 from $32.5
million in 1998,  primarily from the benefit of lower raw material  prices and a
mix shift within our  services  business.  Gross  profit as a percentage  of net
sales improved to 24.4% in 1999 from 22.6% in 1998. Favorable raw material price
trends,  improvements  in  efficiency,  and the mix shift  within  our  services
division more than offset the effect of lower selling prices.

Selling, General and Administrative Expenses

     Selling,  general and administrative  expenses as a percentage of net sales
increased to 18.0% in 1999 from 15.2% in 1998  primarily due to  investments  in
our  services   infrastructure,   the  impact  of  the  New  England   Container
acquisition, and the recording of a legal settlement provision.

Non-Recurring Charges

     In conjunction  with the integration of acquired  entities and expansion of
our  operations,  a plan was developed to  rationalize  our operations and sales
force and  consolidate  and  relocate  our  corporate  headquarters  in order to
improve  operating  efficiencies and reduce costs. This plan began in March 1998
and was  substantially  completed  during the first  quarter of 1999. As part of
this  plan,  we  recorded  restructuring,  integration,  and  other  charges  of
approximately $3.5 million for the six months ended June 30, 1998. These charges
primarily  include  costs  related to the closure of a  container  manufacturing
facility,  severance costs and other personnel  related costs, the relocation of
corporate  headquarters  and other  miscellaneous  costs.  We did not record any
non-recurring charges for the six months ended June 30, 1999.

Income from Operations

     Income from  operations  increased  by $2.0 million to $9.2 million in 1999
from $7.2 million in 1998 as a result of factors described above.

Other (Income) Expense, Net

     Other (income) expense, net increased by $0.1 million in 1999 from 1998 due
to changes in the fair value of foreign exchange contracts.

Interest Expense

     Interest  expense was $10.0  million in 1999  compared with $7.5 million in
1998.  The increase in interest  expense is the result of increased  debt levels
associated with the acquisition of New England  Container and the refinancing of
our  revolving  credit  loan and term  loans and the senior  subordinated  notes
offering in February 1999.

Loss Before Income Taxes and Extraordinary Item

     In 1999,  the loss  before  income  taxes and  extraordinary  item was $0.9
million  versus $0.4  million in 1998,  as the result of the  factors  described
above.

Income Tax Benefit

     The effective tax rate  (benefit) on income was (11.9)% in 1999 and (23.2)%
in 1998,  both  lower  than the  statutory  federal  income  tax rate due to the
non-deductible  portion of goodwill  associated with our acquisitions and higher
foreign income taxes.




<PAGE>



Loss Before Extraordinary Item

     In 1999,  the loss before  extraordinary  item was $0.8 million versus $0.3
million in 1998 due to the factors described above.


Extraordinary Item

     As a result of the February 1999  refinancing of our revolving  credit loan
and term  loans and the senior  subordinated  notes  offering,  we  incurred  an
extraordinary  charge  of $0.8  million,  which is net of tax  benefits  of $0.4
million, relating to the write-off of unamortized deferred financing costs.

Net Loss

     In 1999,  the net loss was $1.6 million  versus $0.3 million in 1998,  as a
result of the factors described above.


Liquidity and Capital Resources

     Our principal uses of cash are for capital expenditures,  interest expense,
working capital,  and  acquisitions.  We utilize funds generated from operations
and  borrowings  to meet these  requirements.  For the six months ended June 30,
1999, cash generated from operations was $5.5 million compared to cash generated
from  operations  of $12.9  million for the six months ended June 30, 1998.  The
decrease was driven  primarily  by  increased  working  capital  investments  in
accounts  receivable and inventory  levels in the first half of 1999 as compared
to the first half of 1998 to support our  services  division's  sales  growth as
well as to purchase raw materials in advance of announced price increases.

     For  the  six  months  ended  June  30,  1999  and  1998  we  made  capital
expenditures of $14.9 million and $12.0 million, respectively. We currently have
no capital  commitments  outside the ordinary course of business.  Our principal
working capital requirements are to finance accounts receivable and inventories.
As of June 30, 1999 we had net working capital of $21.5 million,  including $2.7
million  of cash,  $33.7  million  of  accounts  receivable,  $22.3  million  of
inventories,  $7.6 million of other  current  assets,  and  approximately  $44.8
million of accounts payable and accrued expenses.

     On February 10, 1999,  we  refinanced  our  revolving  credit loan and term
loans by amending  our senior  credit  facility  to provide for a $75.0  million
revolving  credit line (including a $15.0 million  Canadian credit line),  which
bears  interest,  at our  election,  at a  combination  of  domestic  source and
Eurodollar  borrowing rates which fluctuate based on our EBITDA and debt levels,
and a $25.0  million term loan,  bearing  interest at 9.48%  (collectively,  the
"Senior Credit  Facility").  The revolving  credit facility  matures in February
2004 and the term loan matures in two equal  installments in June 2006 and 2007.
In addition,  we issued $150 million of 10 7/8% Senior  Subordinated  Notes (the
"Notes")  due February  15,  2009,  issued at 99.248%  resulting in an effective
yield of 11.0%.  The Senior  Credit  Facility  contains  certain  covenants  and
restrictions and is secured by substantially  all our assets.  The Notes require
semiannual  interest  payments  commencing  August 15, 1999 and mature  February
2009. The Notes are  subordinate to all existing and future senior  indebtedness
and are  unconditionally  guaranteed by the domestic  subsidiaries and contain a
number of customary  covenants and restrictions.  Deferred  financing charges of
approximately $7.1 million were incurred in connection with the refinancing.


<PAGE>



Effect of Inflation

     Inflation generally affects our business by increasing the interest expense
of floating rate indebtedness and by increasing the cost of labor, equipment and
raw materials.  We do not believe that inflation has had any material  effect on
our business during the periods discussed herein.

Recently Issued Accounting Standard

     In June 1998, the Financial Accounting Standards Board issued SFAS No. 133,
"Accounting  for  Derivative  Instruments  and  Hedging  Activities".  SFAS  133
establishes new disclosure  requirements which provide a comprehensive  standard
for recognition and measurement of derivatives and hedging activities. This will
require new disclosures,  all derivatives to be recorded on the balance sheet at
fair value, and special  accounting for particular types of hedges.  SFAS 133 is
currently  scheduled to take effect for us on January 1, 2000, but the Financial
Accounting  Standards  Board  recently  issued an exposure draft of a statement,
which if approved as drafted, would defer the effective date for one year. Based
on our current derivatives, an interest rate collar and foreign currency forward
contracts,  we do not believe  that SFAS 133 will have a material  effect on our
financial condition or results of operations.

Year 2000 Compliance

         General

     As has been widely  reported,  many computer systems process dates based on
two digits for the year of transaction and may be unable to process dates in the
year  2000 and  beyond.  We  believe  that we have  identified  all  significant
internal   systems  and  hardware  with  embedded   applications   that  require
modification  to  ensure  year  2000  compliance.  In  addition,  we  have  sent
questionnaires  to our  critical  vendors in an attempt to confirm that they are
year 2000 compliant. We are conducting our year 2000 compliance efforts with the
assistance of independent consultants.

         Internal Systems

     Our significant  internal systems consist of our accounting systems and our
system that manages the  inventory for our plastic  container  leasing and fleet
management businesses. Two of our four accounting systems have been certified by
the licensor and successfully  tested by us for year 2000 compliance.  We are in
the process of replacing one of the other two  accounting  systems with a system
that is certified by the  licensor as being year 2000  compliant,  and we expect
the replacement and testing to be completed by the end of September 1999. We are
in  the  process  of  updating  the  fourth  accounting  system  for  year  2000
compliance, and we expect the updating and testing to be completed by the end of
September  1999.  We are also in the process of updating our system that manages
the inventory for our plastic container leasing and fleet management  businesses
for year 2000 compliance, and we expect the updating and testing to be completed
by the end of September 1999.

         Hardware

     Our  hardware   with   embedded   applications   principally   consists  of
manufacturing  machinery  for  the  manufacture  of  plastic  and  steel  drums.
Substantially,  all of this machinery has been certified by the manufacturer and
tested by us for year 2000 compliance. Our tests have shown that our hardware is
year 2000 compliant.

         Vendors

     We have sent  questionnaires  to 31 of our  vendors  that we consider to be
critical.  Twenty four vendors have responded,  nineteen by supplying  readiness
disclosures  letters  and  five by  completing  our  questionnaire.  None of the
responding vendors reported any significant year 2000 compliance issues. We have
sent a follow-up  letter to the seven  vendors  that have not  responded  to our
questionnaire.   All  of  the  vendors  which  have  not  responded  are  large,
sophisticated corporations, and we expect that they are aware of their year 2000
compliance issues.

         Year 2000 Risks

     Despite our year 2000 compliance  efforts,  there are many risks associated
with the year 2000 compliance  issue,  including but not limited to the possible
failure of our systems and hardware with embedded  applications.  These failures
could result in:



<PAGE>


 .    our inability to order raw materials,

 .    the malfunctioning of our manufacturing or services processes,

 .    our  inability to properly  bill and collect  payments from our customers
and/or

 .    errors or omissions in accounting  and financial  data,  any of which could
have a material  adverse  effect on our  results  of  operations  and  financial
condition.

In  addition,  there can be no  guarantee  that the systems of other  companies,
including our vendors,  utilities and  customers,  will be converted in a timely
manner, or that a failure to convert by another company, or a conversion that is
incompatible with our systems, would not have a material adverse effect on us.

         Costs

     Through  June  30,  1999  we  have  incurred  and   capitalized   costs  of
approximately  $4.8 million  primarily related to the upgrade and replacement of
our  internal  systems.  We currently  expect that we will incur and  capitalize
future  incremental  costs of approximately  $0.6 million.  We are funding these
costs with a combination of cash from operations and borrowings under our senior
credit  facility.  We have  developed our cost  estimates with the assistance of
independent consultants.

         Contingency Plans

     We have not yet developed any contingency  plans and, based on the state of
our year 2000 readiness,  do not expect that we will have to do so. If, however,
the  testing of our  internal  systems  that we expect to complete by the end of
September 1999 or any further  correspondence with our vendors indicates that it
is necessary,  we will develop  contingency plans to be in place by December 31,
1999.




<PAGE>



                           FORWARD LOOKING STATEMENTS

     This report includes forward-looking  statements. All statements other than
statements  of  historical   facts   included  in  this  report  may  constitute
forward-looking  statements.  We have based these forward-looking  statements on
our current  expectations  and  projections  about  future  events.  Although we
believe  that  our  assumptions  made in  connection  with  the  forward-looking
statements  are  reasonable,  we  cannot  assure  you that our  assumptions  and
expectations  will prove to have been  correct.  We undertake no  obligation  to
publicly update or revise any forward-looking statements, whether as a result of
new information,  future events or otherwise. Important factors that could cause
our actual results to differ from our  expectations  include the following:  our
ability to satisfy our obligations  under our substantial  indebtedness  and the
restrictions  which our  indebtedness  impose on our operations;  our ability to
compete with competitors, including competitors that are larger than us and have
greater  financial  resources than we do; our ability to finance the significant
level of capital expenditures that our operations will require; the availability
of raw materials and our ability to pass along to our customers any increases in
our prices for raw materials;  our ability to identify  suitable  businesses for
acquisition  and our ability to consummate such  acquisitions  and integrate the
operations of such businesses;  unfavorable  shifts in demand from higher margin
products  and services to lower margin  products and  services;  declines in the
level of  economic  activity  in the  industries  served by our  customers;  the
termination of a license under which we obtain important  intellectual property;
adverse  developments  arising out of the ongoing grand jury  investigation into
possible  price-fixing in the plastic drum industry  between 1991 and 1995; loss
of key personnel; employee slowdowns, strikes or similar actions; our compliance
with laws and regulations governing our business,  including federal,  state and
local  environmental,  transportation  and shipping  laws and  regulations;  our
exposure  to  litigation,   including  to  claims  for  product   liability  and
contamination  of the  environment;  and  our  ability  and the  ability  of our
suppliers and customers to achieve year 2000 compliance.


ITEM 3.   QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

Interest Rate Risk and Foreign Currency Exchange Rate Risk

General

     Our results of operations  and financial  condition are affected by changes
in interest rates and foreign  currency  exchange rates as measured  against the
U.S. dollar.  We manage this exposure  through internal  policies and procedures
and the use of derivative financial instruments. In accordance with our internal
policies,  we only use derivative financial  instruments for risk management and
not for speculative or trading purposes.

Interest Rate Risk

     The revolving  indebtedness under our senior credit facility bears interest
at a floating rate. Our primary exposure to interest rate risk is as a result of
changes  in  interest  expense  related to this  indebtedness  due to changes in
market  interest  rates.  We maintain an  interest  rate collar in an  aggregate
notional  principal  amount of $45.0  million to limit our  exposure to interest
rate risk.  Under this collar,  if the actual  Eurodollar  rate at the specified
measurement date is greater than a ceiling rate stated in the collar  agreement,
the other party to the collar pays us the differential  interest expense. If the
actual  Eurodollar rate is lower than the floor stated in the collar  agreement,
we pay the other  party to the collar the  differential  interest  expense.  The
collar terminates on November 30, 2000. A 10% increase in interest rates at June
30,  1999  would  not have had a  material  adverse  affect  on our  results  of
operations, financial condition or cash flows.

Foreign Currency Exchange Rate Risk

     We have operations in Canada and sales denominated in Canadian dollars. Our
primary exposure to foreign  currency  exchange rate risk is a result of changes
in the  exchange  rate  between  the U.S.  dollar and the  Canadian  dollar.  We
currently do not  maintain any  derivative  financial  instruments  to limit our
exposure to this risk. Our Canadian subsidiary,  Hunter Drums Limited, maintains
U.S. dollar denominated  foreign currency exchange contracts which were in place
prior to our  acquisition of Hunter Drums.  At June 30, 1999,  Hunter Drums held
$1.8  million of forward  currency  exchange  contracts  with  settlement  rates
ranging  from $1.38 to $1.41  Canadian  dollars to U.S.  dollars and  settlement
dates through  December  1999.  While these  contracts  increase our exposure to
foreign  currency  exchange  rate risk,  due primarily to the  relatively  short
maturities  of these  contracts,  a 10% change in the exchange  rate on June 30,
1999  between  the U.S.  dollar  and the  Canadian  dollar  would not have had a
material  adverse  affect on our results of operations,  financial  condition or
cash flows.


PART II.     OTHER INFORMATION


ITEM 1.      LEGAL PROCEEDINGS

                  Not Applicable

ITEM 2.     CHANGES IN SECURITIES

                  Not Applicable

ITEM 3.     DEFAULTS UPON SENIOR SECURITIES

                  Not Applicable

ITEM 4.     SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

                  Not Applicable


ITEM 5.     OTHER INFORMATION

                  Not Applicable

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

                  (a)      Exhibits

     *3.1 Certificate of Incorporation of  Russell-Stanley  Holdings,  Inc.

     *3.2 By-Laws of Russell-Stanley Holdings, Inc.

     *4.1 Indenture, dated as of February 10, 1999, by and among Russell-Stanley
Holdings,  Inc., the  guarantors  named therein and The Bank of New York, as the
Trustee

     *4.2 Form of 10 7/8% Senior  Subordinated  Notes due 2009 (included as part
of the Indenture filed as Exhibit 4.1 hereto.)

     *10.1 Fifth Amended and Restated  Revolving  Credit Agreement and Term Loan
Agreement,  dated as of February 10, 1999, among Russell-Stanley  Holdings, Inc.
and its subsidiaries,  as borrowers,  the lenders listed therein and BankBoston,
N.A. as  administrative  agent,  and Goldman  Sachs Credit  Partners,  L.P.,  as
syndication agent.

     *10.2 Stock Purchase  Agreement dated as of July 21, 1998, among Vincent J.
Buonanno, New England Container Co., Inc. and Russell-Stanley Holdings, Inc.

     *10.3  Stock  Purchase  Agreement  dated as of July 1, 1997,  among Mark E.
Daniels,  Robert E. Daniels,  Mark E. Daniels  Irrevocable  Family  Trust,  R.E.
Daniels  Irrevocable  Family  Trust,  Container  Management  Services,  Inc. and
Russell-Stanley Corp.

     *10.4 Share Purchase  Agreement dated as of October 24, 1997, among Michael
W.  Hunter,  John D. Hunter,  Michael W. Hunter  Holdings,  Inc.  John D. Hunter
Holdings,  Inc.,  Hunter  Holdings,  Inc. 373062 Ontario  Limited,  Hunter Drums
Limited, Russell-Stanley Holdings, Inc. and HDL Acquisition, Inc.

     *10.5  Purchase  and Sale  Agreement  dated as of October 23,  1997,  among
Smurfit   Packaging   Corporation,    Russell-Stanley    Holdings,    Inc.   and
Russell-Stanley Corp.

     *10.6  Vestar  Management  Agreement  dated  as of  July  23,  1997,  among
Russell-Stanley  Holdings,  Inc.,  Russell-Stanley  Corp.,  Container Management
Services, Inc. and Vestar Capital Partners.

     *10.7 Know How and Patent Licensing Agreement between Mauser-Werke GmbH and
Russell-Stanley Corp., dated June 26, 1995.

     *10.8 Licensing  Agreement between  Mauser-Werke  GmbH and  Russell-Stanley
Corp., dated June 26, 1995.

     *10.9 Know How and Patent Licensing Agreement between Mauser-Werke GmbH and
Russell-Stanley Corp. dated June 26, 1995.

     *10.10 Know How and Patent Licensing  Agreement  between  Mauser-Werke GmbH
and Hunter Drums Limited, dated July 31, 1996.

     *10.11 Know How and Patent Licensing  Agreement  between  Mauser-Werke GmbH
and Hunter Drums Limited, dated July 31, 1996.

     *10.12 Consent and Agreement  between Hunter Drums Limited and Mauser-Werke
GmbH, dated September 29, 1997.

     *10.13 1998 Stock Option Plan.

     *10.14   Russell-Stanley   Holdings,   Inc.   Management  Annual  Incentive
Compensation Plan 1998.

     *10.15 Employment Agreement,  dated October 30, 1997, among Russell-Stanley
Holdings, Inc., Hunter Drums Limited and Michael W. Hunter.

     *10.16 Stay Pay Agreement,  dated October 30, 1997,  among  Russell-Stanley
Holdings, Inc. and Michael W. Hunter.

     *10.17  Employment   Agreement,   dated  as  of  July  23,  1997,   between
Russell-Stanley Holdings, Inc. and Mark E. Daniels.

     *10.18  Stay  Pay   Agreement,   dated  as  of  July  23,   1997,   between
Russell-Stanley Holdings, Inc. and Mark E. Daniels.

     *10.19  Employment   Agreement,   dated  as  of  July  23,  1998,   between
Russell-Stanley Holdings, Inc. and Gerard C. DiSchino.

     *10.20   Employment   Agreement,   dated   September   20,  1996,   between
Russell-Stanley Corp. and Robert Singleton.

     *  10.21  Services  Agreement,  dated  as of  February  10,  1999,  between
Russell-Stanley Holdings, Inc. and Vincent J. Buonanno.

     *10.22 License Agreement between Gallay SA and Hunter Drums Limited,  dated
February 7, 1997.

     *10.23 License Agreement between Gallay SA and Hunter Drums Limited,  dated
April 16, 1987.

     27 Financial Data Schedule

     * This  Exhibit is  incorporated  by  reference  to the Exhibit of the same
number filed as part of the Company's  Registration  Statement on Form S-4 (File
No. 333-76057).

         (b) Reports on Form 8-K

         None












<PAGE>






                                   SIGNATURES

     Pursuant to the  requirements  of the Securities  Exchange Act of 1934, the
Company  has  duly  caused  this  report  to be  signed  on  its  behalf  by the
undersigned thereto duly authorized.

                                              RUSSELL-STANLEY HOLDINGS, INC.



Date:   September      , 1999             By:___________________________________
                                             Daniel W. Miller,
                                             Executive Vice President
                                             and Chief Financial Officer