<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 EXCHANGE ACT OF 1934

                 For the quarterly period ended March 31, 2000

                                      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 No.  0-27424
                                              -------



                            WILMAR INDUSTRIES, INC.
                            -----------------------
            (Exact name of registrant as specified in its charter)


                    New Jersey                          22-2232386
          --------------------------------          -----------------
          (State of incorporation or                (I.R.S. Employer
          organization)                              Identification No.)


          303 Harper Drive
          Moorestown, New Jersey                          08057
          ----------------------                        ----------
          (Address of principal executive offices)      (Zip Code)


          Registrant's telephone number, including area code: (856) 439-1222

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


     The number of shares of the registrant's common stock, no par value,
outstanding as of April 30, 2000
was 12,408,226.
<PAGE>
ITEM 1 - FINANCIAL STATEMENTS
WILMAR INDUSTRIES, INC.
CONSOLIDATED BALANCE SHEETS - Unaudited
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>

                                                                                March 31,         December 31,
                                                                                  2000               1999
                                                                            ----------------    ---------------
<S>                                                                         <C>                 <C>
ASSETS

CURRENT ASSETS
  Cash and cash equivalents                                                 $     6,193,800     $    5,445,468
  Cash - restricted                                                                 314,119            309,054
  Accounts Receivable - trade, net of allowance for doubtful accounts
   of $2,192,250 in 2000 and $2,130,807 in 1999.                                 40,906,860         39,442,711
  Inventory                                                                      40,716,999         40,911,232
  Prepaid expenses and other current assets                                       2,940,748          3,432,122
  Deferred income taxes                                                           2,678,693          2,188,206
                                                                            ----------------    ---------------
          Total current assets                                                   93,751,219         91,728,793

PROPERTY AND EQUIPMENT, net of accumulated depreciation
  of $10,678,942 in 2000 and $10,128,061 in 1999.                                10,007,567          8,972,008

GOODWILL, net of accumulated amortization of $2,279,166 in 2000
  and $1,746,467 in 1999                                                         84,424,448         84,779,524

INTANGIBLE ASSETS AND OTHER, Net                                                 16,166,173         16,487,886
                                                                            ----------------    ---------------
TOTAL ASSETS                                                                $   204,349,407     $  201,968,211
                                                                            ================    ===============


LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES


  Notes payable                                                             $           -       $          -
  Current portion of long-term debt                                               6,187,500          4,125,000
  Accounts payable                                                               22,041,392         21,884,606
  Accrued expenses and other current liabilities                                 13,654,568         13,898,073
  Accrued interest                                                                  255,001            315,100
  Income taxes payable                                                            3,309,193            860,113
                                                                            ----------------    ---------------
            Total current liabilities                                            45,447,654         41,082,892

LONG-TERM LIABILITIES
  Deferred Compensation                                                             451,068            437,676
  Long-term debt  - net of current portion                                       50,437,500         55,875,000
                                                                            ----------------    ---------------

            Total liabilities                                                    96,336,222         97,395,568


COMMITMENTS AND CONTINGENT LIABILITIES


STOCKHOLDERS' EQUITY
Preferred stock, $.01 par value, 5,000,000 shares authorized; none issued
Common stock, no par value - 50,000,000 shares authorized;
  12,407,826 shares issued and outstanding in 1999
  12,408,226 shares issued and outstanding in 2000                              103,729,854        103,725,914
Accumulated other comprehensive income                                               20,465             56,383
Retained earnings                                                                17,066,429         13,593,909
                                                                            ----------------    ---------------
                                                                                120,816,748        117,376,206
Less: Treasury stock, at cost (1,000,000 shares in 2000 and 1999)               (12,803,563)       (12,803,563)
                                                                            ----------------    ---------------

      Total stockholders' equity                                                108,013,185        104,572,643
                                                                            ----------------    ---------------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                  $   204,349,407     $  201,968,211
                                                                            ================    ===============
</TABLE>

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


<PAGE>
WILMAR INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF INCOME - Unaudited
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>


                                                   For the Three           For the Three
                                                   Months Ended            Months Ended
                                                     March 31,               March 26,
                                                       2000                    1999
                                                 ----------------        ----------------
<S>                                              <C>                     <C>
NET SALES                                        $    75,723,635         $    48,747,114

COST OF SALES                                         49,021,997              34,051,856
                                                 ----------------        ----------------
             Gross profit                             26,701,638              14,695,258

OPERATING EXPENSES:
   Operating and selling expenses                     13,537,046               7,173,587
   Corporate general and administrative expenses       6,132,141               2,911,218
                                                 ----------------        ----------------

   Total operating expenses                           19,669,187              10,084,805
                                                 ----------------        ----------------

             Operating income                          7,032,451               4,610,453

INTEREST (EXPENSE) / INCOME, NET                      (1,112,588)                352,653
                                                 ----------------        ----------------

              Income before income taxes               5,919,863               4,963,106

PROVISION FOR INCOME TAXES                             2,447,343               1,910,800
                                                 ----------------        ----------------

              Net income                         $     3,472,520         $     3,052,306
                                                 ================        ================

   Net income per share - Basic                  $          0.28         $          0.23
                                                 ================        ================

   Net income per share - Diluted                $          0.28         $          0.23
                                                 ================        ================
</TABLE>

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

<PAGE>
WILMAR INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - Unaudited
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>

                                                                                Accumulated
                                                                                   Other                            Total
                                    Common         Stock          Retained     Comprehensive      Treasury       Stockholders'
                                    Shares         Amount         Earnings        Income           Stock       (Deficit) Equity
                                -------------  --------------  -------------  ---------------  -------------  ------------------
<S>                             <C>            <C>             <C>            <C>              <C>            <C>
BALANCE, DECEMBER 25, 1998        13,389,827   $ 103,568,743   $    220,284   $            -   $          -   $     103,789,027

 Exercised Stock Options              17,999          93,041                                                             93,041

 Tax Benefit from Exercised
  Stock Options                                       64,130                                                             64,130

 Repurchase of Common Stock       (1,000,000)                                                   (12,803,563)        (12,803,563)

 Comprehensive income
      Net income                                                 13,373,625

      Foreign currency
       translation                                                                    56,383

   Total comprehensive income                                                                                        13,430,008
                                -------------  --------------  -------------  ---------------  -------------  ------------------

BALANCE, DECEMBER 31, 1999        12,407,826   $ 103,725,914   $ 13,593,909   $       56,383   $(12,803,563)  $     104,572,643
                                =============  ==============  =============  ===============  =============  ==================

 Exercised Stock Options                 400           1,692                                                              1,692

 Tax Benefit from Exercised
  Stock Options                                        2,248                                                              2,248

 Comprehensive income
      Net income                                                  3,472,520

      Foreign currency
       translation                                                                   (35,918)

   Total comprehensive income                                                                                         3,436,602
                                -------------  --------------  -------------  ---------------  -------------  ------------------

BALANCE, MARCH 31, 2000           12,408,226   $ 103,729,854   $ 17,066,429  $        20,465   $(12,803,563)  $     108,013,185
                                =============  ==============  =============  ===============  =============  ==================
</TABLE>


<PAGE>
WILMAR INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS - Unaudited
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>

                                                                  For the three      For the three
                                                                  Months Ending      Months Ending
                                                                  March 31, 2000     March 26, 1999
                                                                  ---------------    ---------------
<S>                                                               <C>                <C>
OPERATING ACTIVITIES :
 Net Income                                                       $    3,472,520     $    3,052,306
 Adjustments to reconcile net income to net cash
  provided by operating activities:
  Depreciation and amortization                                        1,190,499            548,234
  Deferred income taxes                                                 (490,487)            39,000
  Loss (gain) on disposition of property and equipment                    (1,250)
  Changes in assets and liabilities, net of effects
   of acquisition:
   Accounts receivable                                                (1,464,149)           853,240
   Inventory                                                             194,233            618,804
   Prepaid expenses and other current assets                             486,309            (16,614)
   Other                                                                  96,261            (75,989)
   Accounts payable                                                      156,786          2,393,436
   Accrued expenses and other current liabilities                       (706,598)         1,532,948
   Accrued interest                                                      (60,099)
   Deferred Compensation                                                  13,392
   Income taxes payable                                                2,451,328          1,709,790
                                                                  ---------------    ---------------
        Net cash provided by operating activities                      5,338,745         10,655,155
                                                                  ---------------    ---------------
INVESTING ACTIVITIES :
 Purchase of property and equipment, net                              (1,004,814)          (635,576)
 Proceeds from sale of property and equipment                              1,250
 Proceeds from sale of short-term investments                                -
 Acquisition of businesses, including escrow                            (177,623)
 Procceds from escrow settlement                                             -
                                                                  ---------------    ---------------
       Net cash used in investing activities                          (1,181,187)          (635,576)
                                                                  ---------------    ---------------
FINANCING ACTIVITIES :
 (Repayment of) proceeds from notes payable                           (3,375,000)          (708,518)
 Purchases of stock for treasury                                             -           (1,493,750)
 Net proceeds from exercise of stock options                               1,692             37,772
                                                                  ---------------    ---------------
        Net cash provided by financing activities                     (3,373,308)        (2,164,496)
                                                                  ---------------    ---------------
Effect of exchange rate changes on cash                                  (35,918)
                                                                  ---------------    ---------------
NET DECREASE IN CASH                                                     748,332          7,855,083

CASH, BEGINNING OF PERIOD                                              5,445,468         30,611,955
                                                                  ---------------    ---------------
CASH, END OF PERIOD                                               $    6,193,800     $   38,467,038
                                                                  ===============    ===============
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

 Cash paid during the period for :
  Interest                                                        $    1,242,120     $       13,340
                                                                  ===============    ===============
  Income taxes                                                    $      130,291     $      193,250
                                                                  ===============    ===============
</TABLE>

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

<PAGE>

                            WILMAR INDUSTRIES, INC.

           NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - BASIS OF PRESENTATION
------------------------------

The condensed consolidated financial statements include the accounts of Wilmar
Industries, Inc. ("Wilmar" or the "Company") and its subsidiaries.  Inter-
company balances and transactions have been eliminated.

These financial statements have been prepared in accordance with generally
accepted accounting principles for interim financial information and with the
instructions to Form 10-Q and Article 10-01 of Regulation S-X.  Accordingly,
they do not include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements.  In the
opinion of management, such interim statements reflect all adjustments
(consisting of normal recurring adjustments) necessary to present fairly the
financial position and the results of operations and cash flows for the interim
periods presented.  The results of operations for these interim periods are not
necessarily indicative of the results to be expected for the full year ending
December 29, 2000.  These financial statements should be read in conjunction
with the audited consolidated financial statements and footnotes included in the
Company's Form 10-K for the year ended December 31, 1999.

NOTE 2 - ACCOUNTING POLICIES
----------------------------

In June 1998, the Financial Accounting Standards Board ("FASB") issued Statement
of Financial Accounting Standards ("SFAS") No. 133, "Accounting for Derivative
Instruments and Hedging Activities", which establishes accounting and reporting
standards for derivative instruments, including certain derivative instruments
embedded in other contracts, (collectively referred to as "derivatives") and for
hedging activities. It requires that an entity recognize all derivatives as
either assets or liabilities in the statement of financial position and measure
those instruments at fair value.  The effective date for this statement
(originally for all fiscal quarters of fiscal years beginning after June 15,
1999) has been delayed until July 1, 2000.  Management has not yet determined
what effect, if any, this statement will have on the Company.

NOTE 3 - INCOME TAXES
---------------------

The Company provides for income taxes based upon SFAS No. 109, "Accounting for
Income Taxes", which requires an asset and liability approach to financial
accounting and reporting for income taxes.

NOTE 4 - COMPUTATION OF BASIC AND DILUTED NET INCOME PER SHARE
--------------------------------------------------------------

Net income per share presented for all periods have been computed in accordance
with SFAS No. 128, "Earnings per Share." Basic net income per share is computed
by dividing net income by the weighted-average number of shares outstanding
during the period. Diluted net income per share is computed by dividing net
income by the weighted-average number of shares outstanding during the period,
assuming dilution.

   The amounts used in calculating net income per share data are as follows:

<TABLE>
<CAPTION>
                                                          For the Three                    For the Three
                                                          Months Ended                     Months Ended
                                                            March 31,                        March 26,
                                                              2000                             1999
                                                    -------------------------        -------------------------
<S>                                                   <C>                              <C>
Net Income                                                        $ 3,472,520                      $ 3,052,306
                                                                  ===========                      ===========

Weighted Average Shares Outstanding - Basic                        12,407,953                       13,384,915
Effect of Dilutive Stock Options                                      199,292                          118,581
                                                                  -----------                      -----------

Weighted Average Shares Outstanding - Diluted                      12,607,245                       13,503,496
                                                                  ===========                      ===========

</TABLE>

The following options to purchase common stock, although outstanding, were not
included in the computation of weighted average shares outstanding - Diluted
because the options' exercise price was greater than the average market price of
common shares during the period.  For the three months ended March 31, 2000 and
March 26, 1999, 306,374 and 211,600, respectively, were not included.
<PAGE>

                            WILMAR INDUSTRIES, INC.

           NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


NOTE 5 - CONTINGENCIES
----------------------

The Company is involved in various legal proceedings in the ordinary course of
its business, which are not anticipated to have a material adverse effect on the
Company's results of operations or financial position.

NOTE 6 - SUBSEQUENT EVENTS
--------------------------

 SHAREHOLDER LAWSUIT CHALLENGING THE MERGER AND RECAPITALIZATION

Following the public announcement of the merger and recapitalization, a
purported shareholders class action complaint was filed by Phronesis Partners,
L.P. on December 27, 1999 against Wilmar, Wilmar's directors and Parthenon
Capital, Inc. in the Superior Court of New Jersey, Chancery Division, Burlington
County (Docket No. BUR-C-171-99). The complaint alleged, among other things,
that Wilmar's directors had breached their fiduciary duties and that Parthenon
capital has aided and abetted those breaches. The complaint also alleged, among
other things, that the proposed consideration for the merger and
recapitalization and also sought damages.

The parties to the lawsuit reached an agreement in principle to settle the
matter on April 17, 2000. In connection with the settlement:

     .  The special committee has agreed to request William Blair to deliver a
        letter to the special committee, in a form satisfactory to William Blair
        and the special committee, bringing down its fairness opinion through
        April 14, 2000 and wilmar has agreed to publicly disclose such letter by
        filing it with the Securities and Exchange Commission;

     .  the voting and exchange agreement has been amended to require William
        Green and certain trusts established by him to vote their shares of
        Wilmar common stock at the special meeting in favor of and against the
        merger proposal in the same proportions as the votes cast by all other
        wilmar shareholders in the aggregate at the special meeting;

     .  Wilmar has made certain disclosures in its proxy statement;

     .  a stipulation of settlement will be agreed upon which will expressly
        provide that the defendants denied and continue to deny that they
        committed any violations of law, and that the defendants settled the
        matter to eliminate the burden, risk and expense of further litigation,
        and will acknowledge that the plaintiffs' lawsuit in part caused
        additional disclosures to be included in the final proxy settlement
        mailed to Wilmar shareholders; and

     .  the plaintiff's counsel will apply to the applicable New Jersey state
        court for an award of attorneys' fees and disbursements in an aggregate
        amount not to exceed $400,000, and Wilmar and the other defendants will
        not object to this application.

While the parties' agreement in principle is binding, the terms of the
settlement are nevertheless subject to court approval, approval of the plaintiff
class, execution of a final stipulation of settlement, dismissal of the
plaintiff's action, and the closing of the merger contemplated by the merger
agreement.
<PAGE>

                            WILMAR INDUSTRIES, INC.

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

This document contains certain forward-looking statements that are subject to
risks and uncertainties.  Forward-looking statements include certain information
relating to future growth plans, the anticipated costs associated with those
plans, the Company's liability and capital resources, as well as information
contained elsewhere in this report where statements are preceded by, followed by
or include the words "believes," "expects," "anticipates" or similar
expressions.  For such statements the Company claims the protection of the safe
harbor for forward-looking statements contained in the Private Securities
Litigation Reform Act of 1995.  Actual events or results may differ materially
from those discussed in forward-looking statements as a result of various
factors, including without limitation, general market conditions, increased
competition, failure to locate and acquire acquisition candidates, and factors
discussed elsewhere in this report and in the documents incorporated herein by
reference.  The following discussion should be read in conjunction with the
interim financial statements and the notes thereto contained elsewhere in this
report on Form 10-Q.

RESULTS OF OPERATIONS

THREE MONTHS ENDED MARCH 31, 2000 COMPARED TO THREE MONTHS ENDED MARCH 26, 1999

Net Sales.  Net sales increased by  $27 million, or 55.3%, to $75.7 million for
the three months ended March 31, 2000 from $48.7 million for the corresponding
period in 1999. The increase was primarily attributable to the acquisition of
J.A. Sexauer, Inc. ("Sexauer"), Sexauer Ltd. ("Sexauer Ltd.") and Trayco of
S.C., Inc. ("Trayco"), referred to hereafter as  "Sexauer Group", that occurred
in December 1999. Price increases during both periods were modest and made only
on selected items.

Gross Profit.  Cost of sales includes merchandise, freight, distribution center
occupancy expenses and certain delivery costs.  As a percentage of net sales,
gross profit was 35.3% for the three months ended March 31, 2000 compared to
30.1% for the corresponding period in 1999.  The increase in gross profit margin
percentage is attributable to the Sexauer Group historically higher gross profit
margins.

Operating and Selling Expenses.  Operating and selling expenses consist of labor
and other costs associated with operating a distribution center as well as
selling expenses and commissions.  Operating and selling expenses increased by
$6.4 million, or 88.7%, to $13.5 million for the three months ended March 31,
2000, from $7.2 million for the corresponding period in 1999.  As a percentage
of net sales, these expenses represented 17.9% for the three months ended March
31, 2000 compared to 14.7% for the corresponding period in 1999, primarily due
to higher sales commissions at Sexauer Group.

Corporate General and Administrative Expenses.  Corporate general and
administrative expenses increased by $3.1 million, or 105.2%, to $6.1 million
for the three months ended March 31, 2000 from $2.9 million for the
corresponding period in 1999. This increase was the result of the Sexauer Group
acquisition, as well as the additional staffing required to manage a larger
volume of business. As a percentage of net sales, corporate general and
administrative expenses represented 8.1% for the three months ended March 31,
2000 compared to 6.0% for the corresponding period in 1999.

Operating Income.  Operating income increased by $2.4 million or 52.5%, to $7.0
million for the three months ended March 31, 2000 from $4.6 million for the
corresponding period in 1999.  As a percentage of net sales, operating income
was 9.3% for the three months ended March 31, 2000 and 9.5% for the
corresponding period in 1999.

Interest (Expense) Income, Net.  Net interest expense for the three months ended
March 31, 2000 increased by $1.5 million to $1.1 million of net interest expense
from $353,000 of net interest income for the corresponding period in 1999. The
interest expense occurred as a result of the additional debt incurred by the
company related to the Sexauer Group acquisition.
<PAGE>

                            WILMAR INDUSTRIES, INC.


ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS, CONTINUED

RESULTS OF OPERATIONS

THREE MONTHS ENDED MARCH 31, 2000 COMPARED TO THREE MONTHS ENDED MARCH 26, 1999

LIQUIDITY AND CAPITAL RESOURCES

Historically, Wilmar's primary source of liquidity has been cash flow from
operations, supplemented by borrowings under its bank line of credit to support
increases in accounts receivable and inventory, net of accounts payable, and the
public sale of its securities.

Cash provided by operating activities was $5.3 million during the three months
ended March 31, 2000 compared to $10.7 million of cash provided by operating
activities during the corresponding period in 1999.  Cash provided by operating
activities during the three months ended March 31, 2000 consisted of  $3.5
million of net income before adding back depreciation and amortization and other
non-cash charges, decreased  $1.2 million by changes in operating assets and
liabilities. This primarily resulted from a $767,000 decrease in accrued
expenses and accrued interest as well as a $778,000 decrease in inventory,
prepaid expense and other assets offset by an increase in accounts receivable of
$1.5 million and an increase in accounts payable and deferred compensation of
$170,000.

Cash used in investing activities during the three months ended March 31, 2000
was $1.2 million, which consisted of approximately $1.0 million for the purchase
of property and equipment and $178,000 relating to the acquisition of  Sexauer
Group.

Cash used in financing activities during the first three months of 2000 was
approximately $3.4 million for the repayment of notes payable.

Capital expenditures were $1.0 million for the three months ended March 31, 2000
compared to $636,000 for the corresponding period in 1999. Capital expenditures
for the first three months of 2000 were primarily for the opening of our new
distribution centers in Los Angeles and Chicago, as well as improvement and
updating of other distribution centers. In addition, the Company purchased a
digital catalog management software package in order to convert its merchandise
catalogs to an internet format. In addition, The Company purchased state-of -
the-art inventory and replenishment planning software in order to optimize
inventory investments. The Company intends to finance its future capital
expenditures with cash flow from operations and possibly with term debt or
capital leases.

In December 1999, in connection with the Sexauer Group acquisition , the Company
entered into a new credit agreement with a syndicate of banks. The credit
agreement provides for a five year secured revolving credit facility of $30
million of borrowings ($5 million outstanding and $25 million available at March
31, 2000) and a five year term loan of $55 million ($51.6 million outstanding as
of March 31, 2000), the proceeds of which were used to purchase Sexauer Group.
Borrowings under the revolving credit facility and the term loan facility bear
interest at a rate based on certain financial measures. The Company is also
required to pay a commitment fee of 0.375% per annum on the unused commitment.
Interest on outstanding balances under these credit facilities is due and
payable quarterly.  Additionally the Company has an unsecured letter of credit
facility of $5 million with one of the banks in the syndicate.

The credit agreement contains customary affirmative and negative covenants,
including certain covenants requiring the Company to maintain it's debt to cash
flow ratio, fixed charge ratio in addition to meeting a minimum net worth test.
The Company was in compliance with all covenants at March 31, 2000.

Generally, cash flow from operations has been sufficient to fund the Company's
growth. The Company believes that funds generated from operations, together with
funds available under the credit facility discussed above, will be sufficient to
fund the Company's current and foreseeable operational needs and growth
strategy. The Company believes that its existing cash balances, supplemented by
borrowings under existing credit facilities, are adequate to meet planned
operating and capital expenditure needs at least through 2000.  However, if the
Company were to make any significant acquisitions for cash, it may be necessary
for the Company to obtain additional debt or equity financing.
<PAGE>

                            WILMAR INDUSTRIES, INC.

PART II -- OTHER INFORMATION

ITEM 1.   LEGAL PROCEEDINGS

 SHAREHOLDER LAWSUIT CHALLENGING THE MERGER AND RECAPITALIZATION

Following the public announcement of the merger and recapitalization, a
purported shareholders class action complaint was filed by Phronesis Partners,
L.P. on December 27, 1999 against Wilmar, Wilmar's directors and Parthenon
Capital, Inc. in the Superior Court of New Jersey, Chancery Division, Burlington
County (Docket No. BUR-C-171-99). The complaint alleged, among other things,
that Wilmar's directors had breached their fiduciary duties and that Parthenon
capital has aided and abetted those breaches. The complaint also alleged, among
other things, that the proposed consideration for the merger and
recapitalization and also sought damages.

The parties to the lawsuit reached an agreement in principle to settle the
matter on April 17, 2000. In connection with the settlement:

     .  The special committee has agreed to request William Blair to deliver a
        letter to the special committee, in a form satisfactory to William Blair
        and the special committee, bringing down its fairness opinion through
        April 14, 2000 and wilmar has agreed to publicly disclose such letter by
        filing it with the Securities and Exchange Commission;

     .  the voting and exchange agreement has been amended to require William
        Green and certain trusts established by him to vote their shares of
        Wilmar common stock at the special meeting in favor of and against the
        merger proposal in the same proportions as the votes cast by all other
        wilmar shareholders in the aggregate at the special meeting;

     .  Wilmar has made certain disclosures in its proxy statement;

     .  a stipulation of settlement will be agreed upon which will expressly
        provide that the defendants denied and continue to deny that they
        committed any violations of law, and that the defendants settled the
        matter to eliminate the burden, risk and expense of further litigation,
        and will acknowledge that the plaintiffs' lawsuit in part caused
        additional disclosures to be included in the final proxy settlement
        mailed to Wilmar shareholders; and

     .  the plaintiff's counsel will apply to the applicable New Jersey state
        court for an award of attorneys' fees and disbursements in an aggregate
        amount not to exceed $400,000, and Wilmar and the other defendants will
        not object to this application.

While the parties' agreement in principle is binding, the terms of the
settlement are nevertheless subject to court approval, approval of the plaintiff
class, execution of a final stipulation of settlement, dismissal of the
plaintiff's action, and the closing of the merger contemplated by the merger
agreement.


ITEM 2.   CHANGES IN SECURITIES

 Not applicable.

ITEM 3.   DEFAULTS UPON SENIOR SECURITIES

 Not applicable.

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

 Not applicable.

ITEM 5.   OTHER INFORMATION

 Not applicable.

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

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

 27*     Financial Data Schedule

___________________
*  Filed herewith


 (b)  REPORTS ON FORM 8-K
      -------------------

 The Company did not file a Form 8-K during the quarter ended March 31, 2000.
<PAGE>

                                   SIGNATURE



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


                            WILMAR INDUSTRIES, INC.


                           By:  /s/ William Sanford
                              -----------------------
                              William Sanford
                              Senior Vice President and Chief Financial Officer
                           (Duly authorized and Principal financial officer)



Date:   May 15,2000