SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                           --------------------------

                                    FORM 10-Q

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

      For the quarterly period ended March 31, 2001

                                            or

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

      For the transition period from ________ to _________

                         Commission File Number 1-13612

                              CONGOLEUM CORPORATION
             (Exact name of Registrant as specified in Its Charter)

DELAWARE                                                              02-0398678
(State or other jurisdiction of                (IRS Employer Identification No.)
incorporation or organization)

                             3500 Quakerbridge Road
                                  P.O. Box 3127
                           Mercerville, NJ 08619-0127
          (Address of Principal Executive Offices, including Zip Code)
                        Telephone number: (609) 584-3000
              (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 |X| NO |_|

      Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.

              Class                            Outstanding at April 30, 2001
   ---------------------------              -----------------------------------

       Class A Common Stock                              3,651,190
       Class B Common Stock                              4,608,945


                                  Page 1 of 16
<PAGE>

                              CONGOLEUM CORPORATION

                                      Index

                                                                            Page
PART I.     FINANCIAL INFORMATION

Item 1.     Financial Statements:

            Balance Sheets as of March 31, 2001
            (unaudited) and December 31, 2000..................................3

            Statements of Operations for the three months
            ended March 31, 2001 and 2000 (unaudited)..........................4

            Statements of Changes in Stockholders' Equity for the year ended
            December 31, 2000 and the three months ended March 31,
            2001 (unaudited)...................................................5

            Statements of Cash Flows for the three months
            ended March 31, 2001 and 2000 (unaudited)..........................6

            Notes to Unaudited Condensed Financial Statements .................7

Item 2.     Management's Discussion and Analysis of Financial Condition
            and Results of Operations.........................................12

Item 3.     Quantitative and Qualitative Disclosures About Market Risk........14

PART II.    OTHER INFORMATION

Item 1.     Legal Proceedings.................................................15

Item 2.     Changes in Securities.............................................15

Item 3.     Defaults Upon Senior Securities...................................15

Item 4.     Submission of Matters to a Vote of Security Holders...............15

Item 5.     Other Information.................................................15

Item 6.     Reports on Form 8-K...............................................15

Signatures ...................................................................16


                                       2
<PAGE>

PART I. FINANCIAL INFORMATION
Item 1. Financial Statements

<TABLE>
<CAPTION>
                                  CONGOLEUM CORPORATION
                                      BALANCE SHEETS
                                                             March 31,    December 31,
                                                                 2001         2000
                                                                 ----         ----
                                                             (Unaudited)
                                                               (Dollars in thousands)
<S>                                                            <C>          <C>
ASSETS
Current assets:
   Cash and cash equivalents..........................           $3,683      $12,637
   Short-term investments.............................            4,195       12,097
   Accounts and notes receivable, net.................           33,645       25,527
   Inventories........................................           54,316       53,296
   Prepaid expenses and other current assets..........            2,277        3,966
   Deferred income taxes..............................            5,724        3,637
                                                              ---------    ---------
      Total current assets............................          103,840      111,160
Property, plant and equipment, net....................           98,913       99,410
Goodwill, net.........................................           10,847       10,955
Deferred income taxes.................................            1,480        1,530
Other noncurrent assets...............................           15,790       15,996
                                                              ---------    ---------
      Total assets....................................         $230,870     $239,051
                                                              =========    =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
   Accounts payable...................................          $15,840      $19,617
   Accrued expenses...................................           38,608       38,844
   Accrued taxes......................................              352          440
      Deferred income taxes...........................            3,306        3,211
                                                              ---------    ---------
      Total current liabilities.......................           58,106       62,112
Long-term debt........................................           99,637       99,625
Other liabilities.....................................           26,388       26,817
Noncurrent pension liability..........................           11,898       11,858
Accrued postretirement benefit obligation.............            9,208        9,329
                                                              ---------    ---------
      Total liabilities...............................          205,237      209,741

STOCKHOLDERS' EQUITY
Class A common stock, par value $0.01 per share;
   20,000,000 shares authorized; 4,736,950 shares
   issued as of March 31, 2001 and December 31, 2000..               47           47
Class B common stock, par value $0.01 per share;
   4,608,945 shares authorized, issued and
   outstanding  as of March  31, 2001 and
   December 31, 2000..................................               46           46
Additional paid-in capital............................           49,105       49,105
Retained deficit......................................          (12,258)      (8,581)
Minimum pension liability adjustment..................           (3,494)      (3,494)
                                                              ----------   ----------
                                                                 33,446       37,123
Less common stock held in Treasury, at cost; 1,085,760
   shares at March 31, 2001 and December 31, 2000.....            7,813        7,813
                                                              ---------    ---------
      Total stockholders' equity......................           25,633       29,310
                                                              ---------    ---------
      Total liabilities and stockholders' equity......         $230,870     $239,051
                                                              =========    =========
</TABLE>

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


                                       3
<PAGE>

                              CONGOLEUM CORPORATION

                            STATEMENTS OF OPERATIONS

                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                Three Months Ended
                                                                     March 31,
                                                             ------------------------
                                                                2001           2000
                                                              (In thousands, except
                                                                per share amounts)

<S>                                                            <C>            <C>
Net sales................................................      $53,183        $56,868
Cost of sales............................................       42,610         44,205
Selling, general and administrative expenses.............       14,779         14,625
                                                             ---------      ---------
      Loss from operations...............................       (4,206)        (1,962)
Other income (expense):
   Interest income.......................................          276            365
   Interest expense......................................       (2,097)        (1,812)
   Other income..........................................          370            339
   Other expense.........................................           --             --
                                                             ---------      ---------
      Loss before income taxes...........................       (5,657)        (3,070)
   Credit for income taxes...............................       (1,980)        (1,136)
                                                             ---------      ---------
      Net loss...........................................      $(3,677)       $(1,934)
                                                             =========      =========

      Net loss per common share, basic and diluted.......      $  (.45)       $  (.23)
                                                             =========      =========

      Weighted average number of common and
         equivalent shares outstanding...................        8,260          8,286
                                                             =========      =========
</TABLE>

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


                                       4
<PAGE>

                              CONGOLEUM CORPORATION
                  STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
                             (Dollars in thousands)
                                   (Unaudited)

<TABLE>
<CAPTION>
                                  Common Stock                               Accumulated Other
                                 par value $0.01    Additional                 Comprehensive
                                 ---------------     Paid-in     Retained          Loss          Treasury              Comprehensive
                                Class A   Class B    Capital      Deficit       Adjustment*       Stock      Total         Loss
                                -------   -------    -------      -------       -----------       -----      -----         ----
<S>                               <C>       <C>      <C>         <C>             <C>             <C>        <C>          <C>
Balance, December 31, 1999...     $47       $46      $49,105        $(452)       $(1,000)        $(7,616)   $40,130
Purchase of treasury stock...                                                                       (197)      (197)

Minimum pension liability
   adjustment, net of tax
   benefit of $1,434.........                                                     (2,494)                    (2,494)     $ (2,494)
Net loss.....................                                      (8,129)                                   (8,129)       (8,129)
                                                                                                                         ---------
Net comprehensive loss.......                                                                                            $(10,623)
                                -----     -----      -------     ---------       --------        --------   -------      =========
Balance, December 31, 2000...      47        46       49,105       (8,581)        (3,494)         (7,813)    29,310
Net loss.....................                                      (3,677)                                   (3,677)     $ (3,677)
                                                                                                                         ---------
Net comprehensive loss.......                                                                                            $ (3,677)
                                -----     -----      -------     ---------       --------        --------   -------      =========
Balance, March 31, 2001......     $47       $46      $49,105     $(12,258)       $(3,494)        $(7,813)   $25,633
                                =====     =====      =======     =========       ========        ========   =======
</TABLE>

*Entire amount relates to minimum pension liability adjustment.

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


                                       5
<PAGE>

                              CONGOLEUM CORPORATION

                            STATEMENTS OF CASH FLOWS

                                   (Unaudited)
<TABLE>
<CAPTION>
                                                               Three Months Ended
                                                                    March31,
                                                               ------------------
                                                                2001        2000
                                                                 (In thousands)

<S>                                                            <C>        <C>
Cash flows from operating activities:
   Net loss...............................................     $(3,677)   $(1,934)
   Adjustments to reconcile net loss to net cash used
     by operating activities:
      Depreciation.......................................        2,937      2,606
      Amortization.......................................          204        204
      Deferred income taxes...............................      (1,942)       223
      Changes in certain assets and liabilities:
          Accounts and notes receivable...................      (8,118)    (8,850)
          Inventories....................................       (1,020)       139
          Prepaid expenses and other current assets.......       1,811        124
          Accounts payable................................      (3,777)      (637)
          Accrued expenses................................        (324)       (31)
          Other liabilities...............................        (510)      (278)
                                                               -------    -------
             Net cash used by operating activities........     (14,416)    (8,434)
                                                               -------    -------
   Cash flows from investing activities:
      Capital expenditures................................      (2,440)    (5,035)
      Purchase of short-term investments..................      (1,471)        --
      Maturities of short-term investments................       9,373     14,754
                                                               -------    -------
             Net cash provided by investing activities....       5,462      9,719
                                                               -------    -------
   Cash flows from financing activities:
      Purchase of treasury stock..........................          --       (197)
                                                               -------    -------
             Net cash used by financing activities........          --       (197)
                                                               -------    -------
Net (decrease) increase in cash and cash equivalents......      (8,954)     1,088
Cash and cash equivalents:
   Beginning of period....................................      12,637     18,768
                                                               -------    -------
   End of period..........................................      $3,683    $19,856
                                                               =======    =======
</TABLE>

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


                                       6
<PAGE>

                              CONGOLEUM CORPORATION
                NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
                (Dollars in thousands, except per share amounts)

1.    Basis of Presentation

      The condensed financial statements have been prepared in accordance with
accounting principles generally accepted in the United States for interim
financial information and with Rule 10-01 of Regulation S-X and have not been
audited by the Company's independent accountants. Certain information and note
disclosures normally included in annual financial statements prepared in
accordance with accounting principles generally accepted in the United States
required for complete financial statements have been condensed or omitted in
accordance with the rules and regulations of the Securities and Exchange
Commission. The preparation of condensed financial statements requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities and
the reported amounts of revenues and expenses during the reporting period. In
the opinion of management, all adjustments (consisting of normal and recurring
adjustments) considered necessary for a fair presentation of the Company's
financial position have been included. The results of operations for the three
months ended March 31, 2001 are not necessarily indicative of the results to be
expected for a full year. These condensed financial statements should be read in
conjunction with the Company's audited financial statements which appear in the
Company's Annual Report to Stockholders for the period ended December 31, 2000.

2.    Changes in Accounting Principles

      In June 1998, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standard No. 133, "Accounting for Derivative
Instruments and Hedging Activities" (SFAS 133, as amended by SFAS 138), which
requires that an entity recognize all derivatives as either assets or
liabilities in the balance sheet and measure those instruments at fair value.
The Company adopted SFAS 133 in the first quarter of fiscal 2001. Adoption of
this pronouncement did not have a significant effect on the Company's
consolidated financial position or results of operations.

3.    Inventories

      A summary of the major classifications of inventories stated at the lower
of LIFO cost or market is as follows:

                                                    March 31,      December 31,
                                                      2001             2000
                                                    ---------       -----------

           Finished goods.....................       $42,758         $42,268
           Work-in-process....................         4,386           3,600
           Raw materials and supplies.........         7,172           7,428
                                                     -------         -------
                                                     $54,316         $53,296
                                                     =======         =======


                                       7
<PAGE>

4.    Distributor Transition Costs

      During the third quarter of 2000, the Company announced the appointment of
Mohawk Industries, Inc. as a national distributor. At the same time, the Company
announced it was terminating its distribution arrangements with LDBrinkman &
Co., who had been its exclusive distributor in much of the southwestern United
States, accounting for 21% of the Company's sales in 1999. LDBrinkman & Co.
contested the Company's right to terminate its distributor agreement and the
matter went to arbitration in the fourth quarter of 2000. The parties signed a
final settlement agreement in February 2001.

      The Company recorded a charge of $7,717 in the fourth quarter of 2000 to
provide for the nonrecurring costs associated with the transition. Included in
this charge were certain costs incurred by the Company for establishing Mohawk
as a distributor. The Company also agreed to subsidize a portion of the costs of
merchandising materials for Mohawk such as samples and displays. Also included
in the charge are certain termination payments to be made to LDBrinkman pursuant
to the terms of the settlement agreement.

      The Company has provided right-of-return provisions to LDBrinkman in the
termination agreement whereby LDBrinkman may return certain unsold inventory
purchased from the Company that meets minimum size and quality requirements.
Therefore, the Company has deferred the recognition of revenue for its estimate
of returns of inventory under this right-of-return agreement.

      Of the $7,717 in costs incurred during 2000, $3,517 remains unpaid as of
March 31, 2001. These amounts are anticipated to be paid by July 31, 2001.

5.    Loss Per Share

      Loss per share is calculated by dividing net loss by the weighted average
number of shares of common stock outstanding. The effect of potentially diluted
securities (such as stock options) was not considered in any period presented,
as their inclusion would have been anti-dilutive.

6.    Commitments and Contingencies

      The Company is subject to federal, state and local environmental laws and
regulations and certain legal and administrative claims are pending or have been
asserted against the Company. Among these claims, the Company is a named party
in several actions associated with waste disposal sites, asbestos-related claims
and general liability claims. These actions include possible obligations to
remove or mitigate the effects on the environment of wastes deposited at various
sites, including Superfund sites and certain of the Company's owned and
previously owned facilities. The contingencies also include claims for personal
injury and/or property damage. The exact amount of such future costs and timing
of payments are indeterminable due to such unknown factors as the magnitude of
clean-up costs, the timing and extent of the remedial actions that may be
required, the determination of the Company's liability in proportion to other
potentially responsible parties and the extent to which costs may be recoverable
from insurance.


                                       8
<PAGE>

      The Company records a liability for environmental remediation,
asbestos-related claim costs and general liability claims when a clean-up
program or claim payment becomes probable and the costs can be reasonably
estimated. As assessments and clean-ups progress, these liabilities are adjusted
based upon progress in determining the timing and extent of remedial actions and
the related costs and damages. The extent and amounts of the liabilities can
change substantially due to factors such as the nature or extent of
contamination, changes in remedial requirements and technological improvements.
The recorded liabilities are not discounted for delays in future payments and
are not reduced by the amount of estimated insurance recoveries. Such estimated
insurance recoveries are considered probable of recovery.

      Although the outcome of these matters could result in significant expenses
or judgments, management does not believe based on present facts and
circumstances that their disposition will have a material adverse effect on the
financial position of the Company.

      The Company is one of many defendants in approximately 2,098 pending
claims (including workers' compensation cases) involving approximately 14,072
individuals as of March 31, 2001, alleging personal injury from exposure to
asbestos or asbestos-containing products. There were 1,754 claims at December
31, 2000 that involved approximately 12,079 individuals. Activity related to
asbestos claims was as follows:


                                                  Quarter ended    Year ended
                                                    March 31,     December 31,
                                                      2001            2000
           ---------------------------------------------------------------------

           Beginning claims...................        1,754            670
           New claims.........................          371          1,302
           Settlements........................          (10)           (76)
           Dismissals.........................          (17)          (142)
           ---------------------------------------------------------------------

           Ending claims......................        2,098          1,754
                                                      =====          =====

      Nearly all claims allege that various diseases were caused by exposure to
asbestos-containing products, including sheet vinyl and resilient tile
manufactured by the Company (or, in the workers' compensation cases, exposure to
asbestos in the course of employment with the Company). The Company discontinued
the manufacture of asbestos-containing sheet vinyl products in 1983 and
asbestos-containing tile products in 1974. In general, governmental authorities
have determined that asbestos-containing sheet and tile products are nonfriable
(i.e., cannot be crumbled by hand pressure) because the asbestos was
encapsulated in the products during the manufacturing process. Thus,
governmental authorities have concluded that these products do not pose a health
risk when they are properly maintained in place or properly removed so that they
remain nonfriable. The Company has issued warnings not to remove
asbestos-containing flooring by sanding or other methods that may cause the
product to become friable.


                                       9
<PAGE>

      The Company regularly evaluates its estimated liability to defend and
resolve current and reasonably anticipated future asbestos-related claims. It
reviews, among other things, recent and historical settlement and trial results,
the incidence of past and recent claims, the number of cases pending against it,
and asbestos litigation developments that may impact the exposure of the
Company. One such development, the declarations of bankruptcy by several
companies that are typically lead defendants in asbestos-related cases, may have
negatively impacted the Company's claim experience. The estimates developed are
highly uncertain due to the limitations of the available data and the difficulty
of forecasting the numerous variables that can affect the range of the
liability.

      During the fourth quarter of fiscal 2000, the Company updated its
evaluation of the range of potential defense and indemnity costs for
asbestos-related liabilities and the insurance coverage in place to cover these
costs. As a result of the Company's analysis, the Company has determined that
its range of probable and estimable losses for asbestos-related claims through
the year 2049 is $35.1 million to $161.3 million before considering the effects
of insurance recoveries and before discounting to present value. As discussed
previously, it is very difficult to forecast a liability for the Company's
ultimate exposure for asbestos-related claims as there are multiple variables
that can affect the timing, severity, and quantity of claims. Therefore, the
Company has concluded that no amount within that range is more likely than any
other, and therefore has determined that the amount of the gross liability it
should record for asbestos-related claims is equal to $35.1 million in
accordance with accounting principles generally accepted in the United States.

      For a majority of the period that Congoleum produced asbestos-containing
products, the Company purchased primary and excess insurance policies that cover
bodily injury asbestos claims. The Company believes that it has in excess of $1
billion primary and excess insurance coverage available as of December 31, 2000
to cover asbestos-related claims. To date, all claims and defense costs have
been paid through primary insurance coverage, and the Company anticipates that
primary insurance coverage will continue to cover these costs in the near
future.

      The same factors that affect developing forecasts of potential defense and
indemnity costs for asbestos-related liabilities also affect estimates of the
total amount of insurance that is probable of recovery, as do a number of
additional factors. These additional factors include the financial viability of
some of the insurance companies, the method in which losses will be allocated to
the various insurance policies and the years covered by those policies, and how
legal and other loss handling costs will be covered by the insurance policies.

      The Company has determined, based on its review of its insurance policies
and the advice of legal counsel, that approximately $20 million of the estimated
$35 million gross liability is highly probable of recovery. This determination
was made after considering the terms of the available insurance coverage and the
financial viability of the insurance companies. The Company believes that the
criteria to offset the estimated gross liability with this probable insurance
recovery, as defined by accounting principles generally accepted in the United
States, have been met. The balance of the estimated gross liability of $15
million has been reflected in the balance sheet as a long-term liability as of
December 31, 2000 and March 31, 2001. The Company has also recorded in the
balance sheet an insurance receivable of $7 million that represents an estimate
of probable insurance recoveries that do not qualify for offsetting against the
gross liability. This insurance receivable has been recorded in other long-term
assets as of December 31, 2000 and March 31, 2001.


                                       10
<PAGE>

      Since many uncertainties exist surrounding asbestos litigation, the
Company will continue to evaluate its asbestos-related estimated liability and
corresponding estimated insurance assets as well as the underlying assumptions
used to derive these amounts. It is reasonably possible that the Company's total
exposure to asbestos-related claims may be greater than the recorded liability
and that insurance recoveries may be less than the recorded asset. These
uncertainties may result in the Company incurring future charges to income to
adjust the carrying value of recorded liabilities and assets. Congoleum does not
believe, however, that asbestos-related claims will have a material adverse
effect on its financial position or liquidity.


                                       11
<PAGE>

Item  2.    Management's Discussion and Analysis of Financial Condition and
            Results of Operations


Results of Operations

Three months ended March 31, 2001 as compared to three months ended March 31,
2000.

      Net sales for the first quarter of 2001 were $53.2 million compared to
$56.9 million for the first quarter of 2000, a decrease of $3.7 million or 6.5%.
The decrease in sales was due to significant weakness in the manufactured
housing segment partially offset by improved residential sales.

      Gross profit for the first quarter of 2001 was $10.6 million compared to
$12.7 million for the first quarter of 2000, a decrease of $2.1 million. As a
percentage of sales, gross profit was 19.9% in the first quarter of 2001, as
compared to 22.3% in the first quarter of 2000. The decrease in gross profit and
gross profit margins was due to lower sales and production volumes, combined
with higher raw material costs.

      Selling, general and administrative expenses were $14.8 million in the
first quarter of 2001 compared to $14.6 million in the first quarter of 2000, an
increase of $0.2 million or 1.0%. As a percentage of sales, selling, general and
administrative expenses were 27.8% for the first quarter of 2001, up from 25.7%
for the first quarter of 2000. The increase in selling, general and
administrative expenses was due to a $0.7 million charge for severance related
to a workforce reduction in March 2001.

      The loss from operations for the first quarter of 2001 was $4.2 million
(7.9% of net sales), compared to a loss of $2.0 million (3.5% of net sales) for
the first quarter of 2000, an increase of $2.2 million. The increase in
operating loss was due to lower sales and production volume.

      The net loss for the first quarter of 2001 was $3.7 million, compared to a
loss of $1.9 million for the first quarter of 2000, an increase of $1.7 million.
The effective tax rate for the first quarter of 2001 was 35.0%, compared with
37.0% for the first quarter of 2000. The decrease in the effective tax rate for
2001 is primarily due to not recognizing state tax benefits.


                                       12
<PAGE>

Liquidity and Capital Resources

      Cash, cash equivalents and short-term investments declined $16.9 million
for the three months ended March 31, 2001, to $7.9 million. Working capital at
March 31, 2001 was $45.7 million, down slightly from $49.0 million at December
31, 2000. The ratio of current assets to current liabilities at March 31, 2001
and December 31, 2000 was 1.8. The ratio of debt to total capital at March 31,
2001 was .43 compared to .42 at December 31, 2000. Cash used by operations was
$14.4 million for the first quarter of 2001, $6.0 million greater than the first
quarter of 2000. This increase in utilization was primarily due to lower income
of cash and a reduction of payables.

      Capital expenditures were $2.4 million for the first quarter of 2001.
Total 2001 capital spending is projected to be approximately $8.0 million.

      The Company has recorded provisions which it believes are adequate for
environmental remediation and product-related liabilities, including provisions
for testing for potential remediation of conditions at its own facilities. While
the Company believes its estimate of the future amount of these liabilities is
reasonable, that such amounts will not have a material adverse effect on the
financial position of the Company and that they will be paid over a period of
five to ten years, the actual timing and amount of such payments may differ
significantly from the Company's assumptions. Although the effect of future
government regulation could have a significant effect on the Company's costs,
the Company is not aware of any pending legislation which could have a material
adverse effect on its results of operations or financial position. There can be
no assurances that such costs could be passed along to its customers.

      In 1998, the Company's Board of Directors approved a new plan to
repurchase up to $5 million of the Company's Common Stock. As of March 31, 2001,
the Company had repurchased 777,665 shares of its Common Stock for an aggregate
cost of $4.3 million pursuant to this plan.

      The Company's principal sources of liquidity are net cash provided by
operating activities and borrowings under its Amended and Restated Financing
Agreement. The Company believes that these sources will be adequate to fund
working capital requirements, debt service payments, stock and note repurchases
and planned capital expenditures through the foreseeable future.

      Some of the information presented in or incorporated by reference in this
report constitutes "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. Although the Company believes
that its expectations are based on reasonable assumptions, within the bounds of
its knowledge of its business and operations, there can be no assurance that
actual results will not differ materially from its expectations. Factors that
could cause actual results to differ from expectations include: (i) increases in
raw material prices, (ii) increased competitive activity from companies in the
flooring industry, some of which have greater resources and broader distribution
channels than the Company, (iii) unfavorable developments in the national
economy or in the housing industry in general, (iv) shipment delays, depletion
of inventory and increased production costs resulting from unforeseen
disruptions of operations at any of the Company's facilities or distributors and
(v) the future cost and timing of payments associated with environmental,
product and general liability claims.


                                       13
<PAGE>

Item 3:     Quantitative and Qualitative Disclosure About Market Risk

      The Company is exposed to changes in prevailing market interest rates
affecting the return on its investments but does not consider this interest rate
market risk exposure to be material to its financial condition or results of
operations. The Company invests primarily in highly liquid debt instruments with
strong credit ratings and short-term (less than one year) maturities. The
carrying amount of these investments approximates fair value due to the
short-term maturities. Substantially all of the Company's outstanding long-term
debt as of March 31, 2001 consisted of indebtedness with a fixed rate of
interest which is not subject to change based upon changes in prevailing market
interest rates. Under its current policies, the Company does not use derivative
financial instruments, derivative commodity instruments or other financial
instruments to manage its exposure to changes in interest rates, foreign
currency exchange rates, commodity prices or equity prices.


                                       14
<PAGE>

PART II.    OTHER INFORMATION

            Item 1. Legal Proceedings:  None

            Item 2. Changes in Securities and Use of Proceeds:  None

            Item 3. Defaults Upon Senior Securities:  None

            Item 4. Submission of Matters to a Vote of Security Holders:  None

            Item 5. Other Information:  None

            Item 6. Reports on Form 8-K:  None


                                       15
<PAGE>

                              CONGOLEUM CORPORATION

                                    SIGNATURE

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

                                      CONGOLEUM CORPORATION
                                          (Registrant)


Date: May 11, 2001                    By: /s/ H. N. Feist III
                                          --------------------------------------
                                              (signature)

                                      Howard N. Feist III
                                      Chief Financial Officer
                                      (Principal Financial & Accounting Officer)


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