COINMACH LAUNDRY CORPORATION AND SUBSIDIARIES



                       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 September 30, 1999

                                       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 November 12, 1999,  Coinmach Laundry  Corporation
had outstanding  12,931,869  shares of Class A common stock,  par value $.01 per
share (the "Common  Stock"),  and 240,324  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-
         September 30, 1999 (Unaudited) and March 31, 1999                    3

         Condensed Consolidated Statements of Operations (Unaudited) -
         Three and Six Months Ended September 30, 1999 and 1998               4

         Condensed Consolidated Statements of Cash Flows (Unaudited) -
         Six Months Ended September 30, 1999 and 1998                         5

         Notes to Condensed Consolidated Financial Statements (Unaudited)   6-7

Item 2. Management's Discussion and Analysis of Financial Condition
         and Results of Operations                                         8-13


PART II.

Other Information

Item 1. Legal Proceedings                                                    14

Item 2. Changes in Securities                                                14

Item 3. Defaults Upon Senior Securities                                      14

Item 4. Submission of Matters to a Vote of Security Holders                  14

Item 5. Other Information                                                    14

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

Signature Page                                                               16


                                       -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>

                                                           September 30, 1999             March 31, 19991
                                                           ------------------             --------------
                                                              (Unaudited)
<S>                                                                <C>                          <C>
ASSETS:
Cash and cash equivalents                                      $  25,893                    $  26,515
Receivables, net                                                   9,231                        8,107
Inventories                                                       18,375                       16,328
Prepaid expenses                                                   6,853                        6,552
Advance location payments                                         79,423                       79,705
Land, property and equipment, net of accumulated
  depreciation of $150,956 and $123,337                          230,341                      223,610
Contract rights, net of accumulated amortization of
  $86,536 and $70,602                                            399,275                      413,014
Goodwill, net of accumulated amortization of $24,285
  and $20,318                                                    105,192                      109,025
Other assets                                                      17,225                       18,440
                                                                --------                   ---------
Total assets                                                    $891,808                     $901,296
                                                                ========                     ========

LIABILITIES AND STOCKHOLDERS' EQUITY:

Accounts payable                                                $ 22,703                     $ 20,478
Accrued rental payments                                           28,624                       26,888
Accrued interest                                                  16,424                       15,516
Other accrued expenses                                            13,519                       13,366
Deferred income taxes                                             78,248                       81,494
11 3/4% Senior Notes                                             296,655                      296,655
Premium on 11 3/4% Senior Notes, net                               7,406                        8,023
Credit facility indebtedness                                     380,564                      384,003
Other long-term debt                                               6,508                        6,833

Stockholders' equity:
  Common stock and capital in excess of par value                104,718                      104,363
  Receivables from management                                       (190)                        (219)
  Accumulated deficit                                            (63,371)                     (56,104)
                                                                 --------                     -------
Total stockholders' equity                                        41,157                       48,040
                                                                  ------                      -------
Total liabilities and stockholders' equity                      $891,808                     $901,296
                                                                ========                     ========

</TABLE>

See accompanying notes.

------
1. The  March  31,  1999  balance  sheet  has  been  derived  from  the  audited
consolidated 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                             Six Months Ended
                                                         ------------------                             ----------------
                                               September 30,           September 30,           September 30,         September 30,
                                                    1999                    1998                   1999                   1998
                                             ------------------     --------------------     -----------------     ---------------
<S>                                                   <C>                    <C>                    <C>                    <C>

REVENUES                                            $130,060                 $124,975              $263,598               $242,909
COSTS AND EXPENSES:

         Laundry operating expenses                   86,282                   82,155               173,493                159,723
         General and administrative
           expenses                                    2,067                    1,984                 4,146                  3,981
         Depreciation and amortization                30,630                   28,250                60,566                 55,093
         Stock-based compensation
           charge                                        187                      397                   346                    618
                                                     -------                 --------              --------               --------
                                                     119,166                  112,786               238,551                219,415
                                                     -------                 --------              --------               --------

OPERATING INCOME                                      10,894                   12,189                25,047                 23,494

INTEREST EXPENSE, NET                                 16,849                   16,867                33,589                 32,434
                                                     -------                  -------                ------                -------
LOSS BEFORE INCOME TAXES                              (5,955)                  (4,678)               (8,542)                (8,940)
                                                     -------                  -------                -------               -------
PROVISION (BENEFIT) FOR
INCOME TAXES:

         Currently payable                               872                      139                 2,011                    246
         Deferred                                     (1,994)                  (1,222)               (3,286)                (2,477)
                                                      -------                 -------                -------               -------
                                                      (1,122)                  (1,083)               (1,275)                (2,231)
                                                      -------                --------                -------               -------

NET LOSS                                             $(4,833)                $ (3,595)              $(7,267)              $ (6,709)
                                                      -------                 -------               -------               --------
BASIC AND DILUTED LOSS                               $  (.37)                $   (.27)              $  (.55)              $   (.51)
                                                     =======                 ========               =======               ========
PER SHARE
WEIGHTED AVERAGE SHARES
OUTSTANDING:
         Common Shares                            13,167,831               13,167,783            13,167,807             13,167,783

See accompanying notes.
</TABLE>


                                       -4-

<PAGE>


                  COINMACH LAUNDRY CORPORATION AND SUBSIDIARIES

                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)
                            (In thousands of dollars)
<TABLE>
<CAPTION>

                                                                                              Six Months Ended
                                                                                    ----------------------------------
                                                                                    September 30,        September 30,
                                                                                         1999                 1998
                                                                                    -------------         ------------
<S>                                                                                       <C>                  <C>
OPERATING ACTIVITIES:
         Net loss                                                                     $   (7,267)           $   (6,709)
         Adjustments to reconcile net loss to net cash
               provided by operating activities:
             Depreciation                                                                 27,629                25,210
             Amortization of advance location payments                                    12,166                 9,919
             Amortization of intangibles                                                  20,771                19,964
             Deferred income taxes                                                        (3,286)               (2,477)
             Amortization of premium on 11 3/4% Senior Notes                                (617)                 (617)
             Amortization of debt discount and deferred issue costs                          916                   808
             Stock-based compensation                                                        346                   618

         Change in operating assets and liabilities, net of businesses acquired:
             Other assets                                                                   (353)                 (664)
             Receivables, net                                                             (1,124)                   90
             Inventories and prepaid expenses                                             (2,348)                 (920)
             Accounts payable                                                              2,226                   365
             Accrued interest, net                                                           908                   310
             Other accrued expenses, net                                                    (696)                2,478
                                                                                       ---------             ---------
         Net cash provided by operating activities                                        49,271                48,375
                                                                                       ---------             ---------

INVESTING ACTIVITIES:
         Additions to property and equipment                                             (34,402)              (32,842)
         Advance location payments to location owners                                    (10,421)              (10,229)
         Additions to net assets related to acquisitions of businesses                    -                    (86,123)
                                                                                       ---------             ----------
         Net cash used in investing activities                                           (44,823)             (129,194)
                                                                                       ---------             ---------

FINANCING ACTIVITIES:
         Net (repayments) proceeds of credit facility borrowings                          (3,439)               85,594
         Net repayments of bank and other borrowings                                        (196)                 (967)
         Principal payments on capitalized lease obligations                              (1,472)               (1,227)
         Deferred debt issue costs                                                            -                   (227)
         Proceeds from issuance of stock for employee stock option
           plan                                                                               37                    -
                                                                                       ---------               --------
             Net cash (used in) provided by financing activities                          (5,070)               83,173
                                                                                       ---------              --------
             Net (decrease) increase in cash and cash equivalents                           (622)                2,354

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD                                            26,515                22,456
                                                                                       ---------              --------

CASH AND CASH EQUIVALENTS, END OF PERIOD                                                 $25,893               $24,810
                                                                                         =======               =======

SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION:
         Interest paid                                                                  $ 32,472             $  32,682
                                                                                         =======              ========
         Income taxes paid                                                              $  1,947             $    259
                                                                                        ========             =========

NON-CASH FINANCING ACTIVITIES:
         Acquisition of fixed assets through capital leases                             $  1,593             $     915
                                                                                        ========             =========
</TABLE>

                                      -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"), including Coinmach Corporation ("Coinmach"), is the leading supplier
of outsourced laundry services for multi-family housing properties in the United
States. The Company's core business involves leasing laundry rooms from building
owners and property  management  companies,  installing  and  servicing  laundry
equipment and collecting  revenues generated from laundry machines.  The Company
owns and operates approximately 781,000 washers and dryers (hereinafter referred
to as "laundry  machines" or "machines") in  approximately  75,000  locations on
routes  located  throughout  the United  States  and in 172  retail  laundromats
located  throughout Texas and Arizona.  The Company also leases laundry machines
and other  household  appliances  to  corporate  relocation  entities,  property
owners,  managers of  multi-family  housing  properties and  individuals.  Super
Laundry  Equipment  Corp.  ("Super  Laundry"),  a  wholly-owned   subsidiary  of
Coinmach, is a laundromat equipment distribution company.


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 in the  financial  statements.  Actual  results  could differ 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 its fiscal year ended March
31, 1999.


3.  Loss per Share

         Basic  and  diluted  loss per share for each of the three and six month
periods ended September 30, 1999 were calculated based upon the weighted average
number of common shares outstanding of 13,167,831 and 13,167,807,  respectively.
Basic and  diluted  loss per  share for each of the three and six month  periods
ended September 30, 1998 were calculated  based upon the weighted average number
of common shares  outstanding  of  13,167,783.  Conversion of common  equivalent
shares  (stock  options)  was not  assumed  since the  results  would  have been
antidilutive.

                                       -6-

<PAGE>


                  COINMACH LAUNDRY CORPORATION AND SUBSIDIARIES

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


4.  Debt

         At September 30, 1999, the Company had  outstanding  debt consisting of
(a)  approximately  $296.7  million of  Coinmach's 11 3/4% Senior Notes due 2005
(the "Senior Notes"),  (b)  approximately  $270.3 million of term loans, and (c)
approximately  $110.3  million  under a  revolving  line of  credit.  The  above
mentioned  term  loans  and  revolving  line of  credit  represent  indebtedness
pursuant to the Company's existing credit facility (as amended and restated, the
"Amended  and  Restated  Credit  Facility"),  which  is  secured  by  all of the
Company's  real and personal  property.  Under the Amended and  Restated  Credit
Facility, the Company has 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  representations,  warranties and agreements, the Amended and Restated
Credit  Facility  contains  certain  restrictive  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,
transactions with affiliates and the Company's  ability to pay dividends.  Also,
the indenture  governing the Senior Notes  contains  restrictive  covenants that
similarly  limit  Coinmach's  ability to, among other  things,  incur debt,  pay
dividends or make other  distributions,  make investments,  create liens,  enter
into transactions with affiliates, and sell assets.


5.  Employee Stock Purchase Plan

         On August 2, 1999,  the Company  commenced  the first  offering  period
under its Employee  Stock  Purchase Plan (the "Plan").  Subject to the terms and
conditions of the Plan,  all eligible  employees who elect to participate in the
Plan are entitled to purchase shares of Common Stock. Each share of Common Stock
purchased by eligible  employees  under the Plan shall be purchased at a fifteen
percent (15%)  discount to the fair market value of one share of Common Stock as
determined pursuant to the Plan through  consecutive  offering periods until May
3, 2008 or such earlier date that the Plan is terminated. A maximum of 1,000,000
shares of Common  Stock shall be  available  for  purchase  under the Plan.  The
shares of Common Stock sold to participants under the Plan may be authorized and
unissued  Common Stock or previously  issued shares  acquired by the Company and
held in its treasury.  Proceeds are withheld from employees'  payroll deductions
and shares are sold on the last day of each  quarter.  The Plan is  intended  to
qualify as an "employee  stock  purchase plan" under Section 423 of the Internal
Revenue Code.

                                       -7-

<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 based on the beliefs
of the  Company's  management  as of the date of this  report and are subject to
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 31,  1999.  Should  these  risks or  uncertainties
materialize,  or should underlying  assumptions  prove incorrect,  the Company's
future  performance and actual results of operations may differ  materially from
those expected or intended.

General
-------

         The  Company  is  principally  engaged  in the  business  of  supplying
outsourced laundry services for multi-family  housing  properties.  At September
30, 1999,  the Company  owned and  operated  approximately  781,000  washers and
dryers in approximately  75,000 locations on routes throughout the United States
and in 172 retail laundromats located throughout Texas and Arizona. The Company,
through  Super  Laundry,  its  wholly-owned  subsidiary,  is  also a  laundromat
equipment  distribution  company.   Additionally,  the  Company  leases  laundry
machines  and other  household  appliances  to  corporate  relocation  entities,
property owners, managers of multi-family housing properties and individuals.

         The Company's primary financial  objective is to increase its cash flow
from  operations.  Cash  flow  from  operations  represents  a  source  of funds
available to service indebtedness and for investment in both internal growth and
growth through  acquisitions.  The Company has experienced net losses during the
past three fiscal years. Such net losses are attributable in part to significant
non-cash   charges   associated   with   the   Company's    execution   of   its
acquisition-related  growth  strategy,  namely,  high levels of  amortization of
contract  rights  and  goodwill  related to the  addition  of new  machines  and
customers  through  acquisitions  accounted  for  under the  purchase  method of
accounting.

         The Company's most  significant  revenue source is its route  business,
accounting  for more than 85% of its revenue.  The Company  provides  outsourced
laundry  services to locations by leasing laundry rooms from building owners and
property  management  companies,  typically on a long-term,  renewable basis. In
return for the exclusive right to provide these services,  most of the Company's
contracts  provide for commission  payments to the location  owners.  Commission
expense (also referred to as rent expense), the Company's single largest expense
item,  is included in laundry  operating  expenses  and  represents  payments to
location owners. Commissions may be fixed amounts or percentages of revenues and
are generally paid monthly.  Also included in laundry operating expenses are the
costs of machine  maintenance  and  revenue  collection  in the route  business,
including  payroll,  parts,  insurance and other related  expenses,  the cost of
sales associated with the equipment  distribution  business and certain expenses
related to the  operation  of retail  laundromats.  In  addition  to  commission
payments,  many of the  Company's  leases  require the  Company to make  advance
location payments to the location owners. These advance payments are capitalized
and amortized over the life of the applicable lease.

                                       -8-

<PAGE>


                  COINMACH LAUNDRY CORPORATION AND SUBSIDIARIES


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


General (continued)
-------

         Other  revenue  sources  for  the  Company  include:  (i)  constructing
complete   turnkey  retail   laundromats,   retrofitting   retail   laundromats,
distributing  exclusive lines of commercial coin and non- coin operated machines
and parts, and selling service  contracts  (approximately  $19.6 million for the
six months ended  September  30, 1999 and $14.5 million for the six months ended
September  30,  1998);   (ii)  operating,   maintaining  and  servicing   retail
laundromats  (approximately $10.2 million for the six months ended September 30,
1999 and $9.4 million for the six months ended  September 30,  1998);  and (iii)
leasing laundry equipment and other household appliances and electronic items to
corporate relocation entities, property owners, managers of multi-family housing
properties and individuals  (approximately $6.7 million for the six months ended
September  30, 1999 and $5.2  million  for the six months  ended  September  30,
1998).

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 for its fiscal year
ended March 31, 1999.

Comparison of the three and six month periods ended September 30, 1999 and
September 30, 1998
---------------------------------------------------------------------------

         Revenues  increased by  approximately  $5.1 million or 4% for the three
month  period  ended  September  30,  1999,  as  compared  to the  prior  year's
corresponding  period.  Revenues increased by approximately  $20.7 million or 9%
for the six month period  ended  September  30,  1999,  as compared to the prior
year's  corresponding  period. These improvements in revenues resulted primarily
from the Company's  execution of its  acquisition  strategy and increased  route
revenues resulting from internal expansion.  Based on the historical revenues of
acquired  businesses,  the Company estimates that  approximately $8.7 million of
its revenue  increase for the current  six-month  period is primarily due to the
acquisition  of Cleanco,  Inc. and certain of its affiliates in May 1998 and the
acquisition of Gordon & Thomas Companies, Inc. in June 1998. In addition, during
the current six-month period, the Company's installed machine based increased by
approximately 16,000 machines from internal growth as compared to an increase of
approximately  15,600  machines  during the prior year's  corresponding  period.
Included in internal growth are acquisitions of small, local route operators and
new customers secured by the Company's sales force.

         Laundry operating expenses increased by approximately 5% and 9% for the
three and six month  periods  ended  September 30, 1999 as compared to the prior
year's corresponding  periods. This increase was due primarily to an increase in
commission  expense related to the improvements in revenues.  As a percentage of
revenues,  laundry  operating  expenses have remained  relatively  consistent at
approximately  66% for each of the three and six month periods  ended  September
30, 1999 and September 30, 1998.


                                       -9-

<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)
--------------------

         General and  administrative  expenses  increased slightly for the three
and six month periods ended  September 30, 1999, as compared to the prior year's
corresponding  periods.  However,  as a  percentage  of  revenues,  general  and
administrative  expenses remained constant at approximately 1.6% for each of the
three and six month periods ended September 30, 1999 and September 30, 1998.

         Depreciation and amortization increased by approximately 8% and 10% for
the three and six month  periods  ended  September  30, 1999, as compared to the
prior  year's  corresponding  periods,  due  primarily  to  contract  rights and
goodwill associated with the above-mentioned  acquisitions, as well as a related
increase in capital expenditures with respect to the Company's installed base of
machines.

         Operating income margins were approximately 8.4% and 9.5% for the three
and six month  periods ended  September  30, 1999, as compared to  approximately
9.8% and 9.7% for the three and six month periods ended September 30, 1998. This
change was primarily due to increases in depreciation  expense noted above.

         Interest  expense,  net, for the three month period ended September 30,
1999, remained relatively consistent with the prior year's corresponding period.
Interest  expense,  net,  increased by approximately 4% for the six month period
ended September 30, 1999, as compared to the prior year's corresponding  period,
due  primarily  to  increased  borrowing  levels  under the Amended and Restated
Credit Facility in connection with certain acquisitions mentioned above.

         The effective tax benefit rate decreased to  approximately  15% for the
six month period ended September 30, 1999 from  approximately  25% for the prior
year's corresponding  period. The lower effective tax benefit rate is the result
of the  greater  impact that  non-deductible  amortization,  which has  remained
constant,  has when added back to losses before  income  taxes,  which are lower
than in  corresponding  periods.

         EBITDA  (earnings  before   deductions  for  interest,   income  taxes,
depreciation and  amortization)  before  deduction for stock-based  compensation
charges was  approximately  $86.0 million for the six months ended September 30,
1999, as compared to approximately $79.2 million for the corresponding period in
1998,  representing  an  improvement  of  approximately  9%. This  increase  was
primarily the result of increased  revenues,  as discussed above. EBITDA margins
remained  consistent  at  approximately  32.6%  for  both the six  months  ended
September 30, 1999 and September 30, 1998.  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 expenditure 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.



                                       -10-

<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
-------------------------------

         The Company continues to have substantial indebtedness and debt service
requirements.  At September 30, 1999, the Company had outstanding long-term debt
(excluding  the  unamortized  premium  on  the  Senior  Notes  in an  amount  of
approximately  $7.4 million) of approximately  $683.7 million and  stockholders'
equity of approximately $41.2 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;  (b) the restrictive covenants contained in
certain of the agreements governing the Company's  indebtedness will require the
Company  to meet  certain  financial  tests and may 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  outsourced  laundry  services
industry and to economic conditions in general will be limited.

         As the Company has focused on increasing  its cash flow from  operating
activities, it has made significant capital investments, primarily consisting of
capital  expenditures  related to acquisitions,  renewal and growth. 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 six
months  ended  September  30, 1999 were  approximately  $44.8  million.  Of such
amount,  the  Company  spent  approximately  $13.9  million  related  to the net
increase in the installed base of machines of approximately 16,000 machines. The
balance of approximately $30.9 million (which consists of machine  expenditures,
advance location  payments and laundry room  improvements)  was used to maintain
the  existing  machine  base  in  current  locations,  to  replace  discontinued
locations and for general  corporate  purposes.  The full impact on revenues and
cash flow generated from capital  expended on acquisitions  and the net increase
in the  installed  base  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.  While  the  Company
estimates that it will generate sufficient cash flows from operations to finance
anticipated  capital  expenditures,  there can be no assurances  that it will be
able to do so.

         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 as
required  by the Amended and  Restated  Credit  Facility  and  semi-annual  cash
interest payments on the Senior Notes.



                                      -11-

<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)
-------------------------------

         Management believes that the Company's future operating activities will
generate sufficient cash flow to repay indebtedness outstanding under the Senior
Notes and borrowings under the Amended and Restated Credit Facility or to permit
any necessary  refinancings  thereof.  An inability of the Company,  however, to
comply with covenants or other  conditions under the Amended and Restated Credit
Facility or under the indenture governing the Senior Notes, in either case could
result in an  acceleration  of all  amounts  due  thereunder.  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 or on terms  permitted under the
Amended and  Restated  Credit  Facility or the  indenture  governing  the Senior
Notes.

         The  Company's  depreciation  and  amortization  expenses  (aggregating
approximately  $60.6  million for the six months ended  September 30, 1999) 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 a
period of 15 years.

         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. Additionally, the Company expects to utilize excess cash flow
from operations primarily to reduce debt.



                                      -12-

<PAGE>


                  COINMACH LAUNDRY CORPORATION AND SUBSIDIARIES


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


Year 2000 Compliance
--------------------

         The "year  2000" or "Y2K"  problem is the result of  computer  programs
being written using two digits rather than four to define the  applicable  year.
As a  consequence,  computer  programs  that have  time-sensitive  software  may
recognize  a date using  "00" as the year 1900  rather  than the year 2000.  The
Company's  comprehensive  year 2000  initiative  is being  managed  by a team of
internal staff and outside  consultants.  The team's  activities are designed to
ensure that there is no adverse effect on the Company's core business operations
and that transactions with customers,  suppliers and financial  institutions are
fully supported.

         During  the 1999  Fiscal  Year,  the  Company  assessed  the year  2000
readiness of its information  technology ("IT") and non-IT systems.  The Company
determined  that it needed to modify  significant  portions of its IT systems so
that such systems would function properly with respect to dates in the year 2000
and   beyond.   The  Company  has   substantially   completed   its  IT  systems
transformation  and is currently  verifying  the year 2000  compliance  of these
systems.

         In  addition,  as part of its year 2000  initiative,  the  Company  has
contacted its  significant  suppliers,  customers and financial  institutions to
ensure that those parties have  appropriate  plans to remediate year 2000 issues
where their systems interface with the Company's systems or otherwise impact its
operations.  The  Company  is  continuing  to  assess  the  extent  to which its
operations are vulnerable  should those  organizations  fail to properly address
their year 2000 readiness. Based on this review, the Company does not expect the
computer  systems of those  operations to have a material  adverse effect on the
Company's operations.

         While the Company believes its planning efforts are adequate to address
the year 2000 issue,  there can be no guarantee that its computer systems or the
computer  systems  of  other  companies  on  which  the  Company's  systems  and
operations rely will be converted on a timely basis and will not have a material
adverse  effect  on the  operations  of the  Company.  The cost of the year 2000
initiative  has not  been  material  to the  Company's  results  of  operations,
financial  condition  or cash flows and is not  expected  to be  material in the
foreseeable future.

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  will not be  material  to the  Company.  The  Company's  business
generally is not seasonal.



                                      -13-

<PAGE>


                  COINMACH LAUNDRY CORPORATION AND SUBSIDIARIES


PART II.   OTHER INFORMATION

ITEM 1.  Legal Proceedings

         On April 8,  1999,  Sand v.  Coinmach  Laundry  Corporation,  et. al, a
purported  class  action  securities  fraud  lawsuit,  was filed in the  Federal
District  Court for the Eastern  District of New York (the  "Federal  Securities
Action") naming the Company and certain of its executive officers as defendants.
The  Federal  Securities  Action  was  purportedly  brought  on  behalf  of  all
shareholders  of the Company who  purchased or otherwise  acquired the Company's
Common  Stock  during the  period  August 6, 1997 to  September  29,  1998.  The
complaint in the Federal Securities Action alleges violations of various federal
securities laws, including  misrepresentations  of certain information about the
Company.  The  complaint  in the  Federal  Securities  Action  seeks  damages in
unspecified  amounts.   Although  the  outcome  of  this  proceeding  cannot  be
predicted,  based on the  allegations  contained  in the  complaint,  management
believes  that the Federal  Securities  Action will not have a material  adverse
effect on the  financial  condition,  results of operations or cash flows of the
Company.

         The Company is also party to various legal  proceedings  arising in the
ordinary  course  of  business.   Although  the  ultimate  disposition  of  such
proceedings  is not  presently  determinable,  management  does not believe that
adverse  determinations  in any or all such  proceedings  would  have a material
adverse effect upon the financial condition, results of operations or cash flows
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


                                      -14-

<PAGE>


                  COINMACH LAUNDRY CORPORATION AND SUBSIDIARIES


ITEM 6.  Exhibits and Reports on Form 8-K

         (a)      Exhibits

                  3.1      Fourth  Amended and Restated  Certificate of
                           Incorporation     of    Coinmach     Laundry
                           (incorporated  by reference from Exhibit 3.5
                           to  Coinmach  Laundry's  Form  10-Q  for the
                           quarterly  period ended  September 30, 1998,
                           file number 1-11907)


                  3.2      Third   Amended  and   Restated   Bylaws  of
                           Coinmach Laundry  (incorporated by reference
                           from Exhibit 3.1 to Coinmach  Laundry's Form
                           10-Q   for  the   quarterly   period   ended
                           September 27, 1996, file number 1-11907)

                  3.3      Certificate    of   Powers,    Designations,
                           Preferences   and  Relative   Participating,
                           Optional and other Special  Rights of Series
                           A   Preferred   Stock  and   Qualifications,
                           Limitations   and    Restrictions    thereof
                           (incorporated  by reference from exhibit 3.2
                           to  Coinmach  Laundry's  Form  10-Q  for the
                           quarterly  period ended June 28, 1996,  file
                           number
                           1-11907)

                  27.1     Financial Data Schedule

         (b)      Reports on Form 8-K

                  None



                                      -15-

<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: November 12, 1999        /s/    ROBERT M. DOYLE
                               -------------------------------
                               Robert M. Doyle
                               Senior Vice President and Chief Financial Officer
                               (On behalf of registrant and as Principal
                               Financial Officer)




                                      -16-
<PAGE>