<PAGE>
 
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-Q

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

FOR THE PERIOD ENDED JUNE 27, 1997

                                       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 1-11907

                          COINMACH LAUNDRY CORPORATION
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

             DELAWARE                                         11-3258015
     (STATE OR OTHER JURISDICTION OF                       (I.R.S. EMPLOYER
     INCORPORATION OR ORGANIZATION)                        IDENTIFICATION NO.)

     55 LUMBER ROAD, ROSLYN, NEW YORK                           11576
     (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)                 (ZIP CODE)

REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE:   (516) 484-2300


INDICATE BY CHECK MARK WHETHER THE REGISTRANT (1) HAS FILED ALL REPORTS REQUIRED
TO BE FILED BY SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT OF 1934
DURING THE PRECEDING 12 MONTHS (OR FOR SUCH SHORTER PERIOD THAT THE REGISTRANT
WAS REQUIRED TO FILE SUCH REPORTS), AND (2) HAS BEEN SUBJECT TO SUCH FILING
REQUIREMENTS FOR THE PAST 90 DAYS.

YES  X  NO   .
    ---   ---

AS OF THE CLOSE OF BUSINESS ON AUGUST 6, 1997, COINMACH LAUNDRY CORPORATION HAD
OUTSTANDING 10,004,278 SHARES OF CLASS A COMMON STOCK, PAR VALUE $.01 PER SHARE
(THE "COMMON STOCK"), AND 480,648 SHARES OF NON-VOTING CLASS B COMMON STOCK, PAR
VALUE $.01 PER SHARE (THE "NON-VOTING COMMON STOCK").
<PAGE>
 
                 COINMACH LAUNDRY CORPORATION AND SUBSIDIARIES
                 ---------------------------------------------

                                     INDEX
                                     -----

PART I.

Financial Information                                                Page No.
---------------------                                                --------

Item 1. Financial Statements
 
        Condensed Consolidated Balance Sheets-                      
        June 27, 1997 (Unaudited) and March 28, 1997                       3
                                                                    
        Condensed Consolidated Statements of Operations (Unaudited) -
        Three Months Ended June 27, 1997 and June 28, 1996                 4
                                                                    
        Condensed Consolidated Statements of Cash Flows (Unaudited) -
        Three Months Ended June 27, 1997 and June 28, 1996                 5
                                                                    
        Notes to Condensed Consolidated Financial Statements            6-10
 
Item 2. Management's Discussion and Analysis of Financial Condition
        and Results of Operations                                      11-15
 
PART II.
 
Other Information                                                         16
-----------------

Item 1. Legal Proceedings

Item 2. Changes in Securities

Item 3. Defaults Upon Senior Securities

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

Item 5. Other Information

Item 6. Exhibits and Reports on Form 8-K

Signature Page                                                            17
--------------                                                       

                                      -2-
<PAGE>
 
                 COINMACH LAUNDRY CORPORATION AND SUBSIDIARIES
                 ---------------------------------------------


PART I. FINANCIAL INFORMATION
        ---------------------

        ITEM 1.  FINANCIAL STATEMENTS
        -------  --------------------



                     CONDENSED CONSOLIDATED BALANCE SHEETS
                     -------------------------------------
                           (In thousands of dollars)
<TABLE>
<CAPTION>
                                                                              June 27, 1997   March 28, 1997/1/
                                                                              --------------  ------------------
                                                                               (Unaudited)
ASSETS:
<S>                                                                           <C>             <C>
Cash and cash equivalents                                                          $ 19,401            $ 14,729
Receivables, net                                                                      6,467               6,894
Inventories                                                                          10,304               7,959
Prepaid expenses                                                                      3,993               3,170
Advance rental payments                                                              43,975              38,472
Property and equipment, less accumulated
  depreciation of $48,077 and $42,017                                               126,855             112,116
Contract rights, less accumulated amortization of
  $24,252 and $19,815                                                               208,367             180,557
Goodwill, less accumulated amortization of $7,204
  and $5,574                                                                        104,246              95,771

Other assets                                                                         12,710              13,253
                                                                                   --------            --------
Total assets                                                                       $536,318            $472,921
                                                                                   ========            ========
 
LIABILITIES AND STOCKHOLDERS' EQUITY:
 
Accounts payable                                                                   $ 10,746            $  8,941
Accrued commissions                                                                  13,090              10,573
Accrued interest                                                                      4,261               9,712
Other accrued expenses                                                               10,339               8,996
Deferred income taxes                                                                74,570              65,650
11-3/4% Senior Notes                                                                196,655             196,655
Credit facility                                                                     188,000             130,000
9-7/8% promissory note                                                               15,000              15,000
Other Long-term debt                                                                  3,463               3,831
 
Stockholders' equity:
  Common stock and capital in excess of par value                                    53,409              53,265
  Notes receivable from management                                                     (439)               (439)
  Accumulated deficit                                                               (32,776)            (29,263)
                                                                                   --------            --------
Total stockholders' equity                                                           20,194              23,563
                                                                                   --------            --------
Total liabilities and stockholders' equity                                         $536,318            $472,921
                                                                                   ========            ========
</TABLE> 
The accompanying notes are an integral part of these financial statements.


______

1.  The March 28, 1997 Balance Sheet has been derived from the audited financial
statements as of that date.

                                      -3-
<PAGE>
 
                 COINMACH LAUNDRY CORPORATION AND SUBSIDIARIES
                 --------------------------------------------- 


                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                -----------------------------------------------
                                  (UNAUDITED)
                                  -----------
                (In thousands of dollars, except per share data)
<TABLE>
<CAPTION>
 
 
                                                Three Months Ended
                                           ----------------------------
 
                                            June 27,          June 28,
                                              1997              1996
                                           ----------------------------
 
<S>                                        <C>            <C>
REVENUES                                        $72,095        $47,940

COSTS AND EXPENSES

    Laundry operating expenses                   48,236         32,580
    General and administrative expenses           1,489          1,016
    Depreciation and amortization                16,475          9,810
    Stock-based compensation charge                 145              -
                                                -------        -------
                                                 66,345         43,431
                                                -------        -------
OPERATING INCOME                                  5,750          4,509


INTEREST EXPENSE, NET                            10,063          6,141
                                                -------        -------
LOSS BEFORE INCOME TAXES                         (4,313)        (1,632)
                                                -------        -------
PROVISION (BENEFIT) FOR INCOME TAXES:
    Currently payable                                50             50
    Deferred                                       (850)          (450)
                                                -------        -------
                                                   (800)          (400)
                                                -------        -------
NET LOSS                                        $(3,513)       $(1,232)
                                                =======        =======
NET LOSS PER SHARE                                $(.34)
                                                =======
PRO FORMA NET LOSS PER SHARE                                     $(.16)
                                                               =======
 
</TABLE>
The accompanying notes are an integral part of these financial statements.

                                      -4-
<PAGE>
 
                 COINMACH LAUNDRY CORPORATION AND SUBSIDIARIES
                 --------------------------------------------- 

                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                -----------------------------------------------
                                  (UNAUDITED)
                                  -----------
                           (In thousands of dollars)
<TABLE>
<CAPTION>
 
                                                                      Three Months Ended
                                                                     --------------------
                                                                     June 27,   June 28,
                                                                       1997       1996
                                                                     ---------  ---------
<S>                                                                  <C>        <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
    Net loss                                                         $ (3,513)  $ (1,232)
    Adjustments to reconcile net loss to net cash
     provided by operating activities:
      Depreciation and amortization                                    16,475      9,810
      Deferred income taxes                                              (850)      (450)
      Stock-based compensation charge                                     145         --
      Amortization of debt discount and debt issuance costs               161        130
      Increase or decrease in operating assets and liabilities,
        net of business acquired:
        Decrease (increase) in other assets                               870       (821)
        Decrease in receivables, net                                      896      1,109
        Increase in inventories and prepaid expenses                   (1,810)    (1,409)
        Decrease in accounts payable                                     (162)      (205)
        Decrease in accrued interest                                   (5,451)    (4,610)
        Increase in accrued expenses, net                               1,912      1,494
                                                                     --------   --------
      Net cash provided by operating activities                         8,673      3,816
                                                                     --------   --------
CASH FLOWS FROM INVESTING ACTIVITIES:
    Additions to property and equipment                                (9,429)    (5,942)
    Advance rental payments to location owners                         (3,639)    (2,628)
    Additions to net assets related to acquisitions of businesses     (47,548)   (16,722)
                                                                     --------   --------
        Net cash used for investing activities                        (60,616)   (25,292)
                                                                     --------   --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Debt transactions:
    Net repayments of bank and other borrowings                          (225)     4,887
    Deferred debt issuance costs                                         (900)        79
    Proceeds from issuance of term loans from credit facility          58,000         --
    Principal payments on capitalized lease obligations                  (260)      (108)
                                                                     --------   --------
        Net cash provided by financing activities                      56,615      4,858
                                                                     --------   --------
        Net increase (decrease) in cash and cash equivalents            4,672    (16,618)

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD                         14,729     19,858
                                                                     --------   --------
CASH AND CASH EQUIVALENTS, END OF PERIOD                             $ 19,401   $  3,240
                                                                     ========   ========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
 INFORMATION:
    Interest paid                                                    $ 15,428   $ 10,714
                                                                     ========   ========
</TABLE>
The accompanying notes are an integral part of these financial statements.

                                      -5-
<PAGE>
 
                 COINMACH LAUNDRY CORPORATION AND SUBSIDIARIES
                 --------------------------------------------- 

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1.  DESCRIPTION OF BUSINESS

Coinmach Laundry Corporation ("Coinmach Laundry"), a Delaware corporation,
through its wholly-owned subsidiaries (collectively, the "Company"), is
primarily engaged in providing coin-operated laundry equipment services to 
multi-family housing properties throughout much of the United States. After
giving effect to the National Coin Acquisition (as hereinafter defined), the
Company owns and operates approximately 414,000 coin-operated washers and dryers
in over 40,000 locations on routes in 31 states, the District of Columbia and
Mexico and in 151 retail laundromats located throughout Texas. The Company,
through its wholly-owned subsidiary, Super Laundry Equipment Corp., a New York
corporation ("Super Laundry"), also is a construction and laundromat equipment
distribution company. On July 17, 1997, the Company completed the acquisition of
the route businesses of National Coin Laundry, Inc. and Whitmer Vend-O-Mat
Laundry Services, Inc. and the distribution business of National Laundry
Equipment Company for an aggregate cash purchase price of approximately $19.0
million, excluding transaction costs (the "National Coin Acquisition"). See Note
7, "Subsequent Events." The results of operations for the three month period
ended June 27, 1997 do not take into account the National Coin Acquisition.

2.  BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements of the
Company have been prepared in conformity with generally accepted accounting
principles ("GAAP") for interim financial reporting and pursuant to the rules
and regulations of the Securities and Exchange Commission.  Accordingly, such
financial statements do not include all of the information and footnotes
required by GAAP for complete financial statements.  GAAP requires the Company's
management to make estimates and assumptions that affect the amounts reported
therein.  Actual results could vary from such estimates.  The interim results
presented herein are not necessarily indicative of the results to be expected
for the entire year.

In the opinion of management of the Company, these unaudited condensed
consolidated financial statements contain all adjustments of a normal recurring
nature necessary for a fair presentation of the financial statements for the
interim periods presented.

These unaudited condensed consolidated financial statements should be read in
conjunction with the audited consolidated financial statements included in
Coinmach Laundry's Annual Report on Form 10-K for the year ended March 28, 1997.


3.  LOSS PER SHARE

Loss per share for the three months ended June 27, 1997 was calculated based
upon the weighted average number of common shares outstanding of 10,484,926.
Pro forma loss per share for the three months ended June 28, 1996 was calculated
based upon the weighted average number of common shares of 7,774,017, which
amount gives effect to the transactions discussed in Note 5.

                                      -6-
<PAGE>
 
                 COINMACH LAUNDRY CORPORATION AND SUBSIDIARIES
                 --------------------------------------------- 

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(continued)

3.  LOSS PER SHARE (continued)

The Company's historical capitalization differs significantly from its
capitalization effective with its July 23, 1996 initial public offering 
(see Note 5).  Accordingly, historical net loss per common share for the three
months ended June 28, 1996 is not considered by management to be meaningful and
has not been presented. A pro forma net loss per share, on the other hand, is
presented for this period in the accompanying statement of operations. The
calculation of the number of shares used in computing pro forma net loss per
share includes the effect of shares of stock issued and options granted
discussed further in Note 5, as well as the redemption of preferred stock, as
more fully described in Note 5. Pursuant to Securities and Exchange Commission
Staff Accounting Bulletin No. 83, shares of common stock sold or issued at
prices below the initial public offering price per share in the twelve months
preceding the initial public offering have been included in the calculation as
if outstanding for the three months ended June 28, 1996.

In February 1997, the FASB issued SFAS No. 128, "Earnings Per Share." This
standard changes the method of calculating earnings per share and will be
effective for periods ending after December 15, 1997.  Earlier application is
not permitted; however, when adopted, all prior period earnings per share data
presented will be required to be restated to conform with the new standard.  The
Company has determined that the impact of SFAS No. 128 will not have a material
effect on the calculations of earnings per share.


4.  LONG-TERM DEBT

At June 27, 1997, Coinmach Corporation ("Coinmach"), a wholly-owned subsidiary
of Coinmach Laundry, had outstanding long-term debt consisting of (a)
approximately $196.7 million of 11 3/4% Senior Notes due 2005 (the "Senior
Notes"), (b) $188 million of term loans, and (c) a $15.0 million 9 7/8%
promissory note due 2004. The outstanding term loans were made pursuant to a
senior financing arrangement obtained by the Company in January, 1997 consisting
of a $190 million term loan facility and a $70 million revolving credit facility
(the "New Credit Facility"). Indebtedness under the New Credit Facility is
secured by all of the Company's real and personal property. Coinmach Laundry has
guaranteed the indebtedness under the New Credit Facility and pledged to Bankers
Trust Company, as Collateral Agent, its interests in all of the issued and
outstanding shares of capital stock of Coinmach. In addition to certain terms
and provisions, events of default, and customary restrictive covenants and
agreements, the New Credit Facility contains certain covenants including, but
not limited to, a maximum leverage ratio, a minimum consolidated interest
coverage ratio, and limitations on indebtedness, capital expenditures, advances,
investments and loans, mergers and acquisitions, dividends, stock issuances and
transactions with affiliates. Also, the Senior Notes and the New Credit Facility
limit Coinmach's ability to pay dividends. At June 27, 1997, there were no
amounts outstanding under Coinmach's revolving credit facility.

                                      -7-
<PAGE>
 
                 COINMACH LAUNDRY CORPORATION AND SUBSIDIARIES
                 --------------------------------------------- 

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(continued)


5.  STOCKHOLDERS' EQUITY

    A.  INITIAL PUBLIC OFFERING

On July 23, 1996, Coinmach Laundry completed its initial public offering (the
"Offering") of 4,120,000 shares of its Common Stock at a price of $14.00 per
share. Coinmach Laundry's Registration Statement for 4,000,000 shares of Common
Stock was filed with the Securities and Exchange Commission on May 13, 1996 and
subsequently declared effective on July 17, 1996. On July 18, 1996, Coinmach
Laundry filed an additional registration statement on Form S-1 with respect to
the registration of an additional 120,000 shares of Common Stock, which
registration statement was effective upon filing.

In connection with the Offering, the underwriters were granted a 30-day option
to purchase up to an aggregate of 618,000 additional shares of Common Stock to
cover over-allotments (the "Over-Allotment Option"), which Over-Allotment Option
was exercised on August 16, 1996 with respect to the purchase of an additional
63,642 shares of Common Stock.

Proceeds from the Offering were approximately $54.5 million (after giving effect
to the exercise of the Over-Allotment Option), after underwriting discounts and
commissions and before expenses.  After giving effect to the redemption of the
Preferred Stock (as described below), proceeds from the Offering were
approximately $35.3 million, before expenses.

Prior to the Offering, Coinmach Laundry issued, in privately negotiated
transactions, 79,029 shares of its Class B common stock to certain members of
management.  Coinmach Laundry recorded a stock based compensation charge in an
amount of approximately $887,000, attributable to the issuance of such stock in
July 1996.  In addition, approximately $103,000 of outstanding receivables
relating to loans to management in connection with prior purchases of Coinmach
Laundry's common stock were forgiven and was accounted for as a stock-based
compensation charge in July 1996.

    B.  RECLASSIFICATION AND STOCK SPLIT

In connection with the Offering, Coinmach Laundry approved a reclassification
(the "Reclassification") of all of its capital stock pursuant to which all seven
classes of the previously issued and outstanding capital stock of Coinmach
Laundry prior to the Offering were converted into a class of preferred stock, a
class of voting common stock and a class of non-voting common stock.  As part of
the Reclassification, holders of Coinmach Laundry's Class A common stock, Class
E common stock and Class F common stock immediately prior to the Offering
(collectively, the "Preference Shares") also received a distribution consisting
of shares of Common Stock and shares of Series A preferred stock, par value $.01
per share (the "Preferred Stock") representing an amount equal to the sum of:
(a) preferred dividends on such Preference Shares in an amount equal to the
accrued yield (at a rate of 8% per annum, compounded quarterly) on the original
investment in such Preference Shares through July 23, 1996; and (b) an amount
equal to the original investment in such Preference Shares.  Holders of
Preference Shares who were members of the Company's management received an
aggregate of 28,425 shares of Common Stock, and holders of the Preference Shares
who were not

                                      -8-
<PAGE>
 
                 COINMACH LAUNDRY CORPORATION AND SUBSIDIARIES
                 --------------------------------------------- 

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(continued)

5.  STOCKHOLDERS' EQUITY (continued)

members of the Company's management received an aggregate of 1,000 shares of
Preferred Stock.  In connection with the Reclassification, Coinmach Laundry also
approved an approximate 23-to-1 stock split (the "Stock Split") payable to
shareholders of record of Coinmach Laundry on July 12, 1996.

    C.  REDEMPTION OF PREFERRED STOCK

Immediately following the Offering, approximately $19.2 million of the proceeds
of the Offering were used by the Company to retire all of the issued and
outstanding shares of Preferred Stock.

    D.  STOCK OPTION PLAN

Prior to the Offering, the Company adopted the 1996 Employee Stock Option Plan
(as amended and restated, the "Stock Option Plan") which provides that the
Company may grant options for the purchase of up to 1,109,147 shares of Common
Stock to key employees of the Company over a period not to exceed ten years.
The Company may grant incentive stock options or options which do not qualify as
incentive stock options at an exercise price per share not less than 100% of the
fair market value of the Common Stock at the date of grant.  All options granted
under the Stock Option Plan vest over four years in five equal installments (20%
vest immediately on the date of grant and the remainder over a four year period)
and expire ten years from the date of grant.

The Company has granted 181,250 options to various employees of the Company
pursuant to the Stock Option Plan, through June 27, 1997.

On July 23, 1996, in connection with the Offering, Coinmach Laundry granted
certain non-qualified options (the "Options") to certain members of management
(collectively, the "Option Holders") to purchase up to 735,618 shares of Common
Stock at 85% of the initial offering price of the Common Stock.  On September
17, 1996, for the purpose of preserving the Option Holders' percentage interest
of Common Stock represented by the Options (which percentage interest was
decreased as a result of the exercise of the Over-Allotment Option), Coinmach
Laundry granted to the Option Holders additional non-qualified stock options to
purchase up to 3,819 shares of Common Stock (the "Additional Options").  The
Options and Additional Options vest in equal annual installments (20% vest
immediately on the date of grant and the remainder over a four year period)
commencing on July 23, 1996, the effective date of the Offering.  With respect
to Options and Additional Options granted to employees of the Company, the
Company will record the difference between the exercise price and the initial
offering price of Common Stock as a stock-based compensation charge over the
applicable four year vesting period.

On September 17, 1996, Coinmach Laundry granted to certain directors, each of
whom was appointed by the Board of Directors of Coinmach Laundry on such date to
serve as independent directors, options entitling each such director to purchase
up to 60,000 shares of Common Stock (the "Independent Director Options").  The
Independent Director Options vest in equal annual installments

                                      -9-
<PAGE>
 
                 COINMACH LAUNDRY CORPORATION AND SUBSIDIARIES
                 --------------------------------------------- 

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(continued)

5.  STOCKHOLDERS' EQUITY (continued)

(25% vest immediately on the date of grant and the remainder over a three year
period), commencing on September 17, 1996, and entitle each such director to
purchase shares of Common Stock at the initial public offering price of the
Common Stock.  The Company will record the difference between the exercise price
of the Independent Director Options and the fair market value of the Common
Stock on September 17, 1996 as a stock-based compensation charge over the
applicable three year vesting period.

For the three months ended June 27, 1997, the Company has recorded a stock-based
compensation charge of approximately $145,000 relating to the Options, the
Additional Options and the Independent Director Options.


6.  ACQUISITION

On April 23, 1997, pursuant to the terms and conditions of a Merger Agreement
dated as of March 20, 1997, Coinmach completed the acquisition and merger of
Reliable Holding Corp. ("Reliable") and its subsidiaries Reliable Laundry
Service Inc., Girard-Hopkins Acquisition Corp., Maquilados Automaticas S.A. de
C.V., and Automatica S.A. de C.V. (collectively, the "Reliable Entities") with
and into Coinmach, for $44 million in cash (excluding transaction expenses). The
Reliable Entities provide coin-operated laundry equipment services to multi-
family dwellings in California and Mexico.

7.  SUBSEQUENT EVENT

On July 17, 1997, the Company consummated the National Coin Acquisition,
pursuant to which Coinmach acquired 100% of the outstanding voting securities
of National Coin Laundry Holding, Inc., an Ohio Corporation ("NCLH") and
National Laundry Equipment Company, an Ohio corporation ("NLEC").  NCLH is the
parent of National Coin Laundry, Inc., an Ohio corporation ("NCL").  In a
related transaction, the Company acquired substantially all of the assets of
Whitmer Vend-O-Mat Laundry Services, Inc., an Indiana corporation ("Whitmer")
that is an affiliate of NCLH, NLEC and NCL. Coinmach acquired NCLH, NLEC, NCL
and Whitmer (collectively, the "NCL Entities") for an aggregate purchase price
of approximately $19.0 million in cash. The NCL Entities provide coin-operated
laundry equipment services to multi-family dwellings in the states of Ohio,
Indiana, Kentucky, Michigan, West Virginia, Pennsylvania, Georgia, Tennessee,
Illinois and Florida, as well as distributing exclusive lines of commercial coin
and non-coin laundry machines and parts, and selling service contracts.
Subsequent to the acquisition of Whitmer and of the other NCL Entities, such
other entities were merged with and into Coinmach.

                                      -10-
<PAGE>
 
                 COINMACH LAUNDRY CORPORATION AND SUBSIDIARIES
                 --------------------------------------------- 

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

Except for the historical information contained herein, certain matters
discussed in this document are forward-looking statements that involve certain
risks and uncertainties, including the risks and uncertainties discussed below,
as well as other risks set forth in the Company's Annual Report on Form 10-K for
the year ended March 28, 1997. The results of operations for the three month 
period ended June 27, 1997 do not take into account the National Coin 
Acquisition.

GENERAL
-------

The Company, through its operating subsidiaries, is principally engaged in
supplying coin-operated laundry equipment services to multi-family housing
properties located in 31 states, the District of Columbia and Mexico operating
in 151 retail laundromats located throughout Texas. The most significant revenue
source is derived from its routes, which, giving effect to the National Coin
Acquisition, are currently comprised of approximately 40,000 locations
containing over 414,000 coin-operated washing machines and dryers. The Company
provides coin-operated laundry equipment services to locations by leasing
designated laundry rooms in buildings on a long-term basis.

The Company, through its operating subsidiary, also owns and operates Super
Laundry.  Super Laundry's business consists of constructing complete turnkey
laundromat retail stores, retrofitting existing laundromat retail stores,
distributing exclusive and non-exclusive lines of commercial coin and non-coin
laundry machines and parts, and selling service contracts.

RESULTS OF OPERATIONS
---------------------

The following discussion should be read in conjunction with the attached
unaudited condensed consolidated financial statements and notes thereto and with
the Company's audited consolidated financial statements and notes thereto
included in the Company's Annual Report on Form 10-K as of and for the year
ended March 28, 1997.


COMPARISON OF THE THREE MONTH PERIOD ENDED JUNE 27, 1997 AND JUNE 28, 1996

Revenues increased by approximately 50% for the three month period ended June
27, 1997, as compared to the prior year's corresponding period.  The improvement
in revenues for the three month period consisted primarily of increased route
revenues resulting from internal expansion, the acquisition of the route and
laundromat business of Kwik Wash Laundries L.P. in January 1997 (the "Kwik Wash
Acquisition"), and the acquisition of the route business of Reliable Holding
Corp. in April 1997 (the "Reliable Acquisition").  During the three month period
ended June 27, 1997, the Company's installed base increased by approximately
5,500 machines from internal growth (excluding the machines added from the
Reliable Acquisition) as compared to an increase of approximately 2,200 machines
during the prior year period.

Laundry operating expenses increased by approximately 48%, for the three month
period ended June 27, 1997, as compared to the prior year's corresponding
period.  The increase was due primarily to an increase in laundry operating
expenses related to the Kwik Wash Acquisition and the Reliable Acquisition.
Such increase in laundry operating expenses was offset partially by the
implementation

                                      -11-
<PAGE>
 
                 COINMACH LAUNDRY CORPORATION AND SUBSIDIARIES
                 --------------------------------------------- 

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

RESULTS OF OPERATIONS (continued)
---------------------

of cost savings programs in the Company's field operations and the consolidation
of certain operating regions relating to certain acquisitions during the prior
year period.

General and administrative expenses increased by approximately $0.4 million, for
the three month period ended June 27, 1997, as compared to the prior year's
corresponding period.  The increase for the period was due to various expenses
associated with (i) the implementation of the Company's acquisition strategy,
(ii) the development and implementation of procedures for the management of
investor relations, and (iii) systems development, refinement and integration,
in each case, resulting from the Company's recent acqusitions.

Depreciation and amortization expenses increased by approximately 68% for the
three month period ended June 27, 1997, as compared to the prior year's
corresponding period, due primarily to the contract rights and goodwill
associated with the Kwik Wash Acquisition and the Reliable Acquisition as well
as an increase in capital expenditures for the installed base of machines. As a
result of the Company's acquisition activity since early 1995, the Company
incurred approximately $8.7 million in non-cash purchase accounting related
depreciation and amortization charges for the current year period as compared to
$5.8 million for the prior year's corresponding period.

The Company granted Options to certain members of management to purchase shares
of Common Stock at a 15% discount to the initial offering price of the Common
Stock.  With respect to such options granted to its employees, the Company will
record such discount as a stock-based compensation charge over the applicable
four year vesting period.  The Company also granted to two of its disinterested
directors Independent Director Options to purchase up to a total of 120,000
shares of Common Stock.  The Company will record the difference between the
exercise price of such options and the fair market value of the Common Stock on
the date of grant as a stock-based compensation charge over the applicable three
year vesting period.  During the three months ended June 27, 1997, the Company
recorded a stock-based compensation charge of approximately $145,000 relating to
the such Options.

As a result of the above, operating income margins were approximately 8% for the
three month period ended June 27, 1997, as compared to approximately 9%, for the
three month period ended June 28, 1996.

Interest expense, net increased by approximately 64% for the three month period
ended June 27, 1997, as compared to the prior year's corresponding period, due
primarily to interest on indebtedness under the New Credit Facility. Partially
offsetting this increase in interest expense was interest income earned on
excess cash balances generated from the net proceeds from the Offering.

EBITDA (earnings before deductions for interest, income taxes, depreciation and
amortization) was approximately $22.4 million (before deduction for the stock-
based compensation charges) for the three months ended June 27, 1997, as
compared to approximately $14.3 million for the corresponding

                                      -12-
<PAGE>
 
                 COINMACH LAUNDRY CORPORATION AND SUBSIDIARIES
                 --------------------------------------------- 

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

RESULTS OF OPERATIONS (continued)
---------------------

period in 1996, representing an improvement of approximately 56%. EBITDA margins
improved to approximately 31% for the three months ended June 27, 1997, compared
to approximately 30% for the prior year's corresponding period. EBITDA is used
by certain investors as an indicator of a company's historical ability to
service debt. Management believes that an increase in EBITDA is an indication of
the Company's improved ability to service existing debt, to sustain potential
future increases in debt and to satisfy capital requirements. However, EBITDA is
not intended to represent cash flows for the period, nor has it been presented
as an alternative to either (a) operating income (as determined by GAAP) as an
indicator of operating performance or (b) cash flows from operating, investing
and financing activities (as determined by GAAP) as a measure of liquidity.
Given that EBITDA is not a measurement determined in accordance with GAAP and is
thus susceptible to varying calculations, EBITDA as presented may not be
comparable to other similarly titled measures of other companies.

The Company's effective income tax rate differs from the amount computed by
applying the U.S. federal statutory rate to loss before income taxes as a result
of state taxes and permanent book/tax differences (largely attributable to
goodwill and contract rights amortization).

LIQUIDITY AND CAPITAL RESOURCES
-------------------------------

The Company continues to have substantial indebtedness and debt service
requirements.  At June 27, 1997, the Company had outstanding long-term debt of
approximately $403.1 million and stockholders' equity of approximately $20.2
million.

The Company's level of indebtedness will have several important effects on its
future operations, including, but not limited to, the following: (a) a
significant portion of the Company's cash flow from operations will be required
to pay interest on its indebtedness and will not be available for other
purposes; (b) the financial covenants contained in certain of the agreements
governing the Company's indebtedness will require the Company to meet certain
financial tests and will limit its ability to borrow additional funds or to
dispose of assets; (c) the Company's ability to obtain additional financing in
the future for working capital, capital expenditures, acquisitions or general
corporate purposes may be impaired; and (d) the Company's ability to adapt to
changes in the coin-operated laundry equipment services industry and to economic
conditions in general will be limited.  At June 27, 1997, there was no amount
outstanding under the Company's revolving credit facility.

The Company anticipates that it will continue to utilize cash flows from
operations to finance its capital expenditures and working capital needs,
including interest payments on its outstanding indebtedness.  Capital
expenditures for the three months ended June 27, 1997 were approximately $60.6
million.  Of such amount, the Company spent approximately $47.6 million in
acquisition and related transaction costs, including the Reliable Acquisition,
and approximately $3.9 million related to the net increase in the installed base
of machines.  The balance was used to maintain the existing machine base and for
general corporate purposes.  The full impact on revenues and EBITDA generated
from capital expended on acquisitions and the net increase in the installed base
of machines

                                      -13-
<PAGE>
 
                 COINMACH LAUNDRY CORPORATION AND SUBSIDIARIES
                 --------------------------------------------- 

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

LIQUIDITY AND CAPITAL RESOURCES (continued)
-------------------------------

are not expected to be reflected in the Company's financial results until
subsequent reporting periods, depending on certain factors including the timing
of the capital expended.

The Company's working capital requirements are, and are expected to continue to
be, minimal since a significant portion of the Company's operating expenses are
not paid until after cash is collected from the installed machines.  In
connection with certain of the financing agreements governing the Company's
indebtedness, Coinmach is required to make monthly cash interest payments under
the New Credit Facility and semi-annual cash interest payments on the Senior
Notes.

Effective June 2, 1997, Coinmach entered into an amendment to the New Credit
Facility with Bankers Trust Company, First Union National Bank of North
Carolina, Lehman Commercial Paper, Inc. and certain other lending institutions
named therein, to increase the principal amount of the Tranche B term loan by
$60 million. The New Credit Facility, as amended and prior to giving effect to
payment of principal installments, consists of a $70 million revolving credit
facility and a $190 million term loan facility, which is comprised of a Tranche
A term loan in the amount of $30 million and Tranche B term loan in the amount
of $160 million. The New Credit Facility also provides for up to $10 million of
letter of credit financing and short term borrowings under a swing line facility
of up to $5 million.

In connection with Coinmach's January 1997 acquisition of KWL, Inc. ("KWL") and
Kwik-Wash Laundries, Inc. ("Kwik Wash"), the sole partners of Kwik Wash
Laundries, L.P., Coinmach Laundry issued a $15 million promissory note (the
"Kwik Wash Note") in partial payment of the purchase price for the outstanding
voting securities of KWL and Kwik Wash.

Management believes that the Company's future operating activities will generate
sufficient cash flow to repay borrowings under the Senior Notes, the New Credit
Facility and the Kwik Wash Note or to permit any necessary refinancings thereof.
An inability of the Company, however, to comply with covenants or other
conditions contained in the indenture governing the Senior Notes or in the New
Credit Facility could result in an acceleration of all amounts due under the
Indenture and the New Credit Agreement. If the Company is unable to meet its
debt service obligations, it could be required to take certain actions such as
reducing or delaying capital expenditures, selling assets, refinancing or
restructuring its indebtedness, selling additional equity capital or other
actions. There is no assurance that any of such actions could be effected on
commercially reasonable terms, if at all, or on terms permitted under the New
Credit Facility or the indenture governing the Senior Notes.

The Company's depreciation and amortization expenses (aggregating approximately
$16.5 million for the three months ended June 27, 1997) have the effect of
reducing net income but not operating cash flow.  In accordance with GAAP, a
significant amount of the purchase price of businesses acquired by the Company
is allocated to "contract rights", which costs are amortized over periods of up
to 15 years.  Although such accounting treatment can have a favorable effect on
operating cash flow by reducing taxes, such treatment also reduces net income.

                                      -14-
<PAGE>
 
                 COINMACH LAUNDRY CORPORATION AND SUBSIDIARIES
                 --------------------------------------------- 

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

LIQUIDITY AND CAPITAL RESOURCES (continued)
-------------------------------

On July 17, 1997, Coinmach consummated the National Coin Acquisition, pursuant
to which it acquired 100% of the outstanding voting securities of NCLH and NLEC.
NCLH is the parent of NCL. In a related transaction, the Company acquired
substantially all of the assets of Whitmer, an affiliate of NCLH, NLEC and NCL.
Coinmach acquired the NCL Entities for an aggregate purchase price of
approximately $19.0 million in cash. The NCL Entities provide coin-operated
laundry equipment services to multi-family dwellings in the states of Ohio,
Indiana, Kentucky, Michigan, West Virginia, Pennsylvania, Georgia, Tennessee,
Illinois and Florida, as well as distributing exclusive lines of commercial coin
and non-coin laundry machines and parts, and selling service contracts.
Subsequent to the acquisition of Whitmer and of the other NCL Entities, such
other entities were merged with and into Coinmach. The New Credit Facility was
used to fund the National Coin Acquisition.

As part of its business strategy, the Company will continue to evaluate
opportunities to acquire local, regional and multi-regional route businesses.
There can be no assurance that the Company will find attractive acquisition
candidates or effectively manage the integration of acquired businesses into its
existing business.


INFLATION AND SEASONALITY
-------------------------

In general, the Company's laundry operating expenses and general and
administrative expenses are affected by inflation, and the effects of inflation
may be experienced by the Company in future periods.  Management believes that
such effects have not been nor will be material to the Company.  The Company's
business generally is not seasonal.

                                      -15-
<PAGE>
 
                 COINMACH LAUNDRY CORPORATION AND SUBSIDIARIES
                 --------------------------------------------- 

PART II.  OTHER INFORMATION
          -----------------

ITEM 1.   LEGAL PROCEEDINGS

     From time to time, the Company has been, and expects to continue to be,
subject to legal proceedings and claims in the ordinary course of its business.
Although the amount of any liability that could arise with respect to these
actions can not be accurately predicted, management believes that any such
liability, individually or in the aggregate, will not have a material adverse
effect on the financial condition and results of operations of the Company.

ITEM 2.   CHANGES IN SECURITIES

          None

ITEM 3.   DEFAULTS UPON SENIOR SECURITIES

          Not applicable

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

          None

ITEM 5.   OTHER INFORMATION

          None

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

          (a)  Exhibits
               --------

               10.73  Amendment Number One and Waiver, dated as of June 2, 1997,
                      to the Credit Agreement, dated as of January 8, 1997,
                      among Coinmach, Coinmach Laundry, the Lending Institutions
                      named therein, Bankers Trust Company, First Union National
                      Bank of North Carolina and Lehman Commercial Paper, Inc.

               27.1   Financial Data Schedule

          (b)  Reports on Form 8-K
               -------------------

               None

                                      -16-
<PAGE>
 
                 COINMACH LAUNDRY CORPORATION AND SUBSIDIARIES
                 --------------------------------------------- 

                                  SIGNATURES

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


                             COINMACH LAUNDRY CORPORATION
                           
Date: August 11, 1997        /s/  ROBERT M. DOYLE
                                 -------------------------------
                             Robert M. Doyle
                             Senior Vice President and Chief Financial Officer
                             (On behalf of registrant and as Principal Financial
                              Officer)

                                      -17-