<PAGE>   1
==============================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                             ---------------------

                                   FORM 10-K
                             ---------------------
                ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                      THE SECURITIES EXCHANGE ACT OF 1934

FOR FISCAL YEAR ENDED JUNE 30, 1999                COMMISSION FILE NUMBER 1-5341

                               ELCOR CORPORATION
             (Exact name of Registrant as specified in its charter)

<TABLE>
<S>                                                    <C>
                      DELAWARE                                              75-1217920
           (State or other jurisdiction of                               (I.R.S. Employer
           incorporation or organization)                               Identification No.)
                14643 DALLAS PARKWAY
            WELLINGTON CENTRE, SUITE 1000
                    DALLAS, TEXAS                                           75240-8871
      (Address of principal executive offices)                              (Zip Code)
</TABLE>

       Registrant's telephone number, including area code: (972) 851-0500

          Securities registered pursuant to Section 12(b) of the Act:

<TABLE>
<CAPTION>
                                                                     NAME OF EACH EXCHANGE ON
                 TITLE OF EACH CLASS                                     WHICH REGISTERED
                 -------------------                                 ------------------------
<S>                                                    <C>
         Common Stock Par Value $1 Per Share                        The New York Stock Exchange
     Rights to Purchase Series A Preferred Stock                    The New York Stock Exchange
</TABLE>

          Securities registered pursuant to Section 12(g) of the Act:



                                      NONE
                                ----------------
                                (Title of Class)

     Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of the Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K.  [ ]

     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 aggregate market value of common stock held by nonaffiliates as of
September 7, 1999, was $419,266,486. This amount is based on the closing price
of the Registrant's Common Stock on the New York Stock Exchange on September 7,
1999. Shares of stock held by directors and officers of the Registrant as well
as shares allocated to such persons under the Employee Stock Ownership Plan of
the Registrant were not included in the above computation; however, the
Registrant has made no determination that such entities are "Affiliates" within
the meaning of Rule 405 under the Securities Act of 1993, as amended.

     As of the close of business on September 7, 1999, the Registrant had
19,988,074 shares of Common Stock outstanding.

     Documents incorporated by reference. Listed below are the documents, any
portion of which are incorporated by reference and the parts of this report into
which such portions are incorporated:

                    PROXY STATEMENT DATED SEPTEMBER 17, 1999
                             PART III OF FORM 10-K
==============================================================================
<PAGE>   2



                                     PART I

Item 1.  Business

         Elcor Corporation (Registrant), incorporated in 1965 as a Delaware
corporation, is a publicly held corporation headquartered in Dallas, Texas.
Shares of the Registrant's common stock are traded on the New York Stock
Exchange with the ticker symbol - ELK.

Lines of Business

         Roofing Products

         The Registrant, through Elk Corporation of Dallas and its subsidiaries
(Elk), is engaged in the manufacture and sale of premium laminated fiberglass
asphalt shingles and accessory roofing products. Elk also manufactures and sells
nonwoven fiberglass roofing mats for use in manufacturing asphalt roofing
products, and nonwoven mats for use in other industrial applications. Elk's
premium laminated fiberglass asphalt shingle manufacturing plants are located in
Tuscaloosa, Alabama, Ennis, Texas, and Shafter, California. In August 1999, Elk
announced plans to build a fourth major laminated shingle plant in Myerstown,
Pennsylvania. Commencement of operations for this new plant is scheduled for the
December quarter of calendar year 2000. The Myerstown, Pennsylvania plant is
expected to increase Elk's total laminated shingle capacity by approximately
38%.

         The major products manufactured at Elk's roofing plants are premium
laminated fiberglass asphalt shingles sold under its brand names: Prestique(R)
Plus, Prestique I, Prestique II and Capstone(R). In fiscal 1995, Elk introduced
Prestique premium laminated fiberglass asphalt shingle product lines with the
patented Enhanced High Definition(R) and Raised Profile(TM) look. In addition,
Elk also manufactures premium fiberglass asphalt hip and ridge products:
Seal-a-Ridge(R) and Z(R) ridge brands. Several other premium asphalt roofing and
accessory products are currently under development. Overall, asphalt shingles
account for about 90% of the nation's sloped roof market. Premium laminated
asphalt shingles account for approximately 37% of the residential sloped asphalt
shingle roofing market. About 83% of all asphalt shingles are used in reroofing
and remodeling and 17% are used in new construction.

         Elk's roofing products are sold by employee sales personnel primarily
to roofing wholesale distributors, delivery being made by contract carrier or by
customer vehicles from the manufacturing plants or warehouses. Elk's products
are distributed nationwide with Texas, California and Florida representing the
largest market areas. The Roofing Products segment accounted for approximately
88% of consolidated sales of the Registrant in fiscal 1999. For the past several
years, the building materials distribution industry has consolidated at a rapid
pace with many smaller independent distributors being acquired by emerging
larger national building products distributors. One customer, ABC Supply Co.
Inc., the largest roofing wholesale distributor in the United States, accounted
for 18% of consolidated sales in fiscal 1999, 16% of consolidated sales in
fiscal 1998, and 14% of consolidated sales in fiscal 1997.




                                       1
<PAGE>   3

         Elk operates two nonwoven fiberglass mat lines that run in parallel at
its Ennis, Texas facility. Elk's nonwoven fiberglass roofing mat facilities
supply all of its internal fiberglass roofing mat needs. In addition, roofing
mats are sold by employee sales personnel to other asphalt roofing products
manufacturers. Nonwoven mats are also sold to manufacturers of construction and
industrial products who use such mats in their products, and to distributors of
industrial filtration products. Elk's nonwoven mats are shipped by contract
carrier to its other roofing plants and to its customers' locations.

         On September 15, 1998, Elk experienced an explosion at its fiberglass
roofing mat plant in Ennis, Texas. The explosion significantly damaged a drying
oven and caused less extensive damage to the remainder of one mat manufacturing
line. There was no damage to the separate mat line that runs in parallel to the
damaged line, nor was there any damage to Elk's Ennis, Texas shingle
manufacturing plant. There were no injuries from the explosion. The damaged line
was restored to partial operation in December 1998. By March 1999, the damaged
section had been replaced. In June 1999, the line was operating at line speeds
equivalent to line speeds at the time of the explosion. Refer to the
"Involuntary Conversion" footnote on page 36 of this Form 10-K for a more
detailed discussion of this matter.

         During fiscal 1999, Elk made significant progress in developing a
family of proprietary Versashield(TM) nonwoven coated products for use in a
variety of industrial and consumer applications. A semi-commercial pilot
manufacturing line was installed at the Ennis, Texas facility to further
development of these products and to initiate market development sales.

         Industrial Products

         The Registrant, through Chromium Corporation (Chromium), historically
has conducted its operations through two business divisions and so operated
throughout fiscal 1999. Effective July 1, 1999, Chromium's business divisions
were segregated into separate companies. The former Reciprocating Engine
Components Division will continue to do business as Chromium Corporation and the
former Conductive Coatings Division will be operated as subsidiaries of
Cybershield, Inc. (Cybershield).

         Cybershield is engaged in electroless shielding of plastic enclosures
for digital wireless cellular phones, telecommunications and other electronic
equipment. Electroless shielding is designed to control the level of
electromagnetic and radio frequency interference (EMI/RFI) emissions generated
by microchips and electronic components. Cybershield's product offerings also
include dispense conductive gaskets which are formed in place, proprietary
plating of die-cast magnesium components, decorative finishes, conductive spray
paints and vacuum metalization of plastic components. Sales are generated by
employee sales personnel, with delivery made primarily by contract carrier. To
keep pace with rapidly growing demand, Cybershield completed a third expansion
of its Lufkin, Texas facility during fiscal 1999.

         In January 1999, Cybershield acquired YDK America, Inc., located in
Canton, Georgia, a leading supplier to the computer industry of electronic
plastic enclosures and components having electroless conductive coatings. This
acquisition doubled Cybershield's electroless coating capacity and
geographically reduced the source concentration risk for its customers. In June
1999, YDK America, Inc. was renamed Cybershield of Georgia, Inc.


                                       2
<PAGE>   4


         Chromium is engaged in the remanufacture of diesel engine cylinder
liners, including hard chrome plating of cylinder bores and tin plating of
pistons, primarily for the railroad and marine industries; and hard chrome
plating of original equipment cylinder liners and tin plating of pistons for
major domestic locomotive manufacturers. In the fourth quarter of fiscal 1999,
Registrant's management approved a consolidation plan for Chromium's
reciprocating engine components business. All operations for this business
activity at Lufkin, Texas will be transferred to Chromium's Cleveland, Ohio
plant. Relocation and other consolidation items are expected to be completed in
the first half of fiscal 2000. Subsequent to the completion of this business
consolidation, the Lufkin, Texas facility will be used exclusively for
conductive coatings operations.

         Another unit of the Registrant, OEL, Ltd., d/b/a Ortloff Engineers,
Ltd. (Ortloff) is engaged in providing technology licensing and engineering
support services and in providing engineering consulting services to the oil and
gas production, gas processing and sulfur recovery industries. Ortloff licenses
technology covered by and related to twelve patents owned by the Registrant for
use in new or redesigned natural gas and refinery gas processing facilities, and
utilizes technology licensed from others and its own expertise in the
performance of consulting and engineering assignments. Although one important
patent expired in fiscal 1999, Ortloff was awarded three new patents and
continues to develop and patent improved processes for natural gas processing.
Moreover, Ortloff offers significant expertise and other nonpatented technology
associated with its processes that is difficult for customers to obtain on a
cost effective basis from others. Ortloff has also been successful in expanding
its markets into several parts of Latin America.

         Patent license fees are calculated by standard formulas that take into
account both specific project criteria and market conditions, adjusted for
special conditions that exist in a project. Engineering consulting assignments
are performed under consulting services agreements at negotiated rates.

Information as to Industry Segments

         For Financial Information by Company Segments, see the table on page 40
of this Annual Report on Form 10-K.

Accounting Change

         In fiscal 1999, the Registrant adopted Statement of Position 98-5,
"Reporting on the Costs of Start-Up Activities," issued by the Accounting
Standards Executive Committee of the America Institute of Certified Public
Accountants. The cumulative effect of this change in accounting principle is
reported on the Consolidated Statement of Operations.

Competitive Conditions

         Roofing Products

         Even though the asphalt roofing products manufacturing business is
highly competitive, the Registrant believes that Elk is a leading manufacturer
of premium laminated fiberglass asphalt shingles. Elk has been able to compete
successfully with its competitors, some of which are larger in size and have
greater financial resources.




                                       3
<PAGE>   5

         There are a number of major national and regional manufacturers
marketing their products in a portion or all of the market areas served by the
Registrant's plants. The Registrant competes primarily on the basis of product
quality, design and service. Typically, the Registrant is able to sell its
roofing products at higher prices than its competitors receive for similar type
products.

         Industrial Products

         The Registrant believes the success of Cybershield in becoming a
qualified supplier for and obtaining significant orders from major digital
cellular phone manufacturers, together with telecommunications and other
electronic equipment manufacturers, has enabled it to become a market leader.
The Registrant competes primarily on the basis of product quality, design and
service.

         The Registrant believes that Chromium is the leading remanufacturer of
diesel engine cylinder liners and pistons for the railroad and marine
transportation industries and is the primary supplier of hard chrome plated
finishes for original equipment diesel engine cylinder liners to all of the
major domestic locomotive manufacturers. The Registrant believes it has smaller
competitors in the locomotive diesel engine cylinder liner remanufacturing
market. Chromium has achieved a leading position in these markets through
competition on the basis of product performance, quality, service and price. In
addition, technical innovations that enhance quality and performance are also
increasing the value-added content per unit produced. However, consolidation in
the railroad industry and environmental regulations have fostered a competitive
market with more economies of scale and scope. Accordingly, it may be desirable
for Chromium to form strategic alliances with customers or others in the supply
chain.

         The Registrant believes that it holds significant state-of-the-art
patents covering some of the most competitive processes for the cryogenic
processing of refinery and natural gas streams to remove the higher value
components, such as ethane and propane, which are primarily used as
petrochemical feedstocks. The Registrant believes that Ortloff has widely
recognized expertise in the design and operation of facilities for natural gas
and refinery gas processing and sulfur recovery.

Backlog

         Backlog was not significant, nor is it material, in the Registrant's
operations.

Raw Materials

         Roofing Products

         In the asphalt roofing products manufacturing business, the significant
raw materials are ceramic coated granules, asphalt, glass fibers, resins and
mineral filler. All of these materials are presently available from several
sources and are in adequate supply. Historically, the Registrant has been able
to pass some of the higher raw material and transportation costs through to the
customer.



                                       4
<PAGE>   6


         Industrial Products

         In the electroless shielding business, copper and nickel are the
significant raw materials. These materials are presently available and are in
adequate supply. In the Registrant's business of hard chrome plating and
remanufacturing diesel engine cylinder liners, chromic acid is a significant raw
material which is presently available from a number of domestic suppliers. The
Registrant believes these domestic suppliers obtain the ore for manufacturing
chromic acid principally from sources outside the United States, some of which
may be subject to political uncertainty. The Registrant has been advised by its
suppliers that they maintain substantial inventories of chromic acid in order to
minimize the potential effects of foreign interruption in ore supply.

         No raw materials are utilized in the Registrant's engineering
consulting and technology licensing business.

Patents, Licenses, Franchises and Concessions

         The Registrant holds certain patents, particularly in its engineering
consulting and licensing business, which are significant to its operations.
However, the Registrant does not believe that the loss of any one of these
patents or of any license, franchise or concession would have a material adverse
effect on the Registrant's overall business operations. The Registrant, through
its subsidiary, Elk Corporation of Dallas, is involved in patent litigation
against GAF Building Materials Corporation and related GAF entities concerning
design and utility patents covering certain aspects of Elk's High Definition
shingles. Refer to Item 3 "Legal Proceedings" for a more detailed discussion of
this matter.

Environmental Matters

         The Registrant and its subsidiaries are subject to federal, state and
local requirements regulating the discharge of materials into the environment,
the handling and disposal of solid and hazardous wastes, and protection of the
public health and the environment generally (collectively, Environmental Laws).
Certain facilities of the Registrant's subsidiaries ship waste products to
various waste management facilities for treatment or disposal. Governmental
authorities have the power to require compliance with these Environmental Laws,
and violators may be subject to civil or criminal penalties, injunctions or
both. Third parties may also have the right to sue for damages and/or to enforce
compliance and to require remediation of contamination.

         The Registrant and its subsidiaries are also subject to Environmental
Laws that impose liability for the costs of cleaning up contamination resulting
from past spills, disposal, and other releases of hazardous substances. In
particular, an entity may be subject to liability under the Federal
Comprehensive Environmental Response, Compensation and Liability Act (CERCLA or
Superfund) and similar state laws that impose liability -- without a showing of
fault, negligence, or regulatory violations -- for the generation,
transportation or disposal of hazardous substances that have caused or may
cause, environmental contamination. In addition, an entity could be liable for
cleanup of property it owns or operates even if it did not contribute to the
contamination of such property. From time to time, the Registrant or its
subsidiaries may incur such remediation and related costs at the company owned
plants and certain offsite locations.




                                       5
<PAGE>   7

         The Registrant anticipates that its subsidiaries will incur costs to
comply with Environmental Laws, including remediating any existing
non-compliance with such laws and achieving compliance with anticipated future
standards for air emissions and reduction of waste streams. Such subsidiaries
expend funds to minimize the discharge of materials into the environment and to
comply with governmental regulations relating to the protection of the
environment. Neither these expenditures nor other activities initiated to comply
with Environmental Laws is expected to have a material impact on the
consolidated financial position, net earnings or liquidity of the Registrant.

Persons Employed

         At June 30, 1999, the Registrant and its subsidiaries had 1,145
employees. Of this total, 597 were employed in the Roofing Products business
segment, 512 were employed in the Industrial Products business segment, and 36
were employed at the corporate office. The Registrant believes that it has good
relations with its employees. In the fourth quarter of fiscal 1999, the
Registrant's management approved a consolidation plan for Chromium's
reciprocating engine components business that will result in the elimination of
64 positions in the first half of fiscal 2000.

Extended Payment Terms

         In some years, the Registrant's roofing products business provides
extended payment terms to certain customers for some product shipments during
the winter and early spring months, with payment generally due during the summer
months. As of June 30, 1999, $3,468,000 in receivables relating to such
shipments were outstanding, the majority of which are due in the first four
months of fiscal 2000. As of August 31, 1999, $1,909,000 of these receivables
had been collected.

Seasonal Business

         The Registrant's industrial products businesses are substantially
nonseasonal. The Registrant's roofing products manufacturing business is
seasonal to the extent that cold, wet or icy weather conditions during the late
fall and winter months in its marketing areas typically limit the installation
of residential roofing products which causes sales to be slower during such
periods. Damage to roofs from extreme weather such as severe wind, hurricanes
and hail storms can result in higher demand for periods up to eighteen to
twenty-four months depending upon the extent of roof damage. Working capital
requirements and related borrowings fluctuate during the year because of
seasonality. Generally, working capital requirements and borrowings are higher
in the spring and summer months, and lower in the fall and winter months.




                                       6
<PAGE>   8


Item 2.  Properties

         All significant facilities are owned and unencumbered by liens in favor
of nonaffiliates except as discussed herein.

         Roofing Products

         Asphalt roofing products are manufactured at plants located in
Tuscaloosa, Alabama, Ennis, Texas and Shafter, California. A fourth major
laminated shingle plant in Myerstown, Pennsylvania is under construction and is
scheduled to commence operations in the December quarter of calendar year 2000.
Fiberglass roofing mat, nonwoven industrial, reinforcement and filtration
products are manufactured on two parallel production lines located in Ennis,
Texas.

         Corporate headquarters and administrative offices for the asphalt
roofing products operations are located in the same leased facility as the
Registrant's corporate offices in Dallas, Texas.

         Industrial Products

         Conductive coatings operating facilities are located in Lufkin, Texas
and Canton, Georgia. Plants for the reciprocating engines components business,
which primarily are involved in the hard chrome plating of original equipment
and remanufactured diesel engine cylinder liners and related equipment, are
located in Cleveland, Ohio and Lufkin, Texas. In the first half of fiscal 2000,
operations for the reciprocating engine components business will be consolidated
and all operations for this business activity will be transferred to Cleveland,
Ohio. Subsequent to the completion of this business consolidation, the Lufkin,
Texas facility will be used exclusively for Cybershield's conductive coatings
operations.

         Corporate headquarters and administrative offices for the conductive
coatings and reciprocating engines components businesses are located in the same
leased facility as the Registrant's corporate offices in Dallas, Texas.

         The Ortloff engineering and process licensing group is located in
leased offices in Midland, Texas.

         Corporate Offices

         The Registrant's corporate headquarters is located in leased offices in
Dallas, Texas.

         In addition, one of the Registrant's subsidiaries owns land and
buildings in Waco, Texas, formerly used in the discontinued solid waste handling
equipment manufacturing business. This facility is expected to be sold in fiscal
2000.



                                       7
<PAGE>   9


Item 3.  Legal Proceedings

         GAF Patent Litigation

         On February 8, 1994, a wholly owned subsidiary, Elk Corporation of
Dallas (Elk) was granted a design patent covering the ornamental aspects of
certain Elk shingles. On December 6, 1994, Elk was granted a utility patent on
the functional aspects of certain Elk shingles. Elk has sued GAF Building
Materials Corporation and related GAF entities (collectively, GAF) in federal
court for infringement of these patents and trade dress. In the design patent
case, Elk seeks to recover as damages the total profit that GAF has made from
the infringing shingles. In the utility patent case, Elk seeks to recover as
damages a reasonable royalty on GAF's sales of infringing shingles and certain
lost profits.

         GAF seeks a declaratory judgment that the Elk patents are not infringed
and are either invalid or unenforceable. GAF has also asserted claims for unfair
competition, Lanham Act violations based on alleged false advertising, and
common law fraud, generally praying for damages of not less than $25 million
including actual and punitive damages, plus interest, costs, and reasonable
attorney fees. Elk disputes GAF's claims, and management intends vigorously to
defend them and to enforce its intellectual property rights. In April 1998, the
District Court for the Northern District of Texas entered a partial final
judgment in the design patent case based on an inequitable conduct ruling and
certified the case for appeal. On February 11, 1999, the United States Court of
Appeals for the Federal Circuit (Court of Appeals) issued a decision upholding
the district court's partial final judgment against Elk in its design patent
case. The decision held that the district court committed no reversible error in
finding Elk's design patent unenforceable. On April 16, 1999, the Court of
Appeals denied Elk's petition for a rehearing of the case.

         On July 15, 1999, Elk appealed by a petition for certiorari with the
United States Supreme Court. GAF filed its opposition in August 1999. Elk
expects a Supreme Court decision whether to hear its appeal before the end of
fiscal 2000.

         While management can give no assurances regarding the ultimate outcome
of the litigation, even if the outcome were to be adverse to Elk, it is not
expected to have a material effect on the Registrant's consolidated results of
operations, financial position or liquidity.

         Gibraltar Tort Litigation

         In December 1995 through August 1996, Chromium Corporation was sued in
four separate tort lawsuits brought by the same attorneys on behalf of numerous
plaintiffs who allege unspecified personal injuries and property damages
associated with the former operation of a licensed hazardous waste treatment,
storage and disposal facility in Smith County, Texas known as the Gibraltar
facility. The four suits were brought against or expanded to include the current
and former owners and operators of the facility, and more than fifty other
defendants, including Chromium and several Fortune 500 companies, as generators
of waste sent to the facility (as named in a particular lawsuit, "Generator
Defendants").


                                       8
<PAGE>   10
         The plaintiffs non-suited or dismissed the Generator Defendants from
two of the cases. In another case, Williams, et al. v. Akzo Nobel Chemicals,
Inc., et al., the Smith County (Texas) District Court dismissed Chromium and
certain other Generator Defendants, but the ruling dismissing these Generator
Defendants was reversed on appeal.

         In June 1999, Chromium entered into a settlement agreement involving
plaintiffs from the Williams case and Adams v. American Ecology Environmental
Services Corporation, a related case pending in the Tarrant County (Texas)
District Court since August 1996. Consummation of the settlement is pending. The
settlement, which Chromium accrued in the fourth quarter of fiscal 1999, did not
have a material adverse effect on the Registrant's consolidated results of
operations, financial position, or liquidity. The facility owners and Chromium's
insurers have declined or failed to accept Chromium's claims relating to defense
and indemnity from the Gibraltar suits, and collection of these claims remains
uncertain.

         Frontier Chemical Site

         In 1993, Chromium entered into an Administrative Order on Consent with
the United States Environmental Protection Agency (USEPA) under which Chromium
and other Potentially Responsible Parties (PRPs) agreed to perform Phase I
response activities at the Frontier Chemical Royal Avenue Site (Site), a former
state-permitted waste processing and management facility in New York and to
reimburse USEPA for response costs incurred by USEPA at the Site. All of the
Phase I work was concluded in 1994. Chromium was assessed a total of $109,250 of
the $4 million cost estimate assessed to all Phase I PRPs. Chromium has not been
and does not expect to be named as a PRP in any subsequent phases of cleanup.

         Chromium's final assessment in this matter net of all recoveries cannot
be calculated until its PRP group determines which assessments are
uncollectible, and certain proceedings to share in proceeds of a closure bond or
to challenge USEPA cost reimbursement calculations are finally resolved.
Management of the Registrant believes that future offsets or other adjustments
to the original assessment will be relatively nominal, and that the final
disposition of this matter will not have a material adverse effect on the
Registrant's consolidated results of operations, financial position, or
liquidity.

         Other

         There are various other lawsuits and claims pending against the
Registrant and its subsidiaries arising in the ordinary course of their
businesses. In the opinion of the Registrant's management based in part on
advice of counsel, none of these actions should have a material adverse effect
on the Registrant's consolidated results of operations, financial position, or
liquidity.

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

         Inapplicable.



                                       9
<PAGE>   11



Executive Officers of the Registrant

         Certain information concerning the Registrant's executive officers is
set forth below:

<TABLE>
<CAPTION>

                                                                               Period             Age as of
                                                                               Served              Sept. 1,
          Name                          Title                                As Officer              1999
------------------------     --------------------------                      ----------        ---------------

<S>                          <C>                                             <C>               <C>
Harold K. Work               Chairman of the Board,                          17 years                 66
                             Chief Executive Officer and
                             President of Elcor Corporation;
                             Chairman and Director of Elk
                             Corporation of Dallas, a subsidiary,
                             and Chairman and Director of its
                             subsidiaries

Richard J. Rosebery          Vice Chairman,                                  24 years                 64
                             Chief Financial and
                             Administrative Officer, and
                             Treasurer of Elcor Corporation;
                             Officer and Director of all subsidiaries
                             and Chairman and/or President of
                             certain subsidiaries

Leonard R. Harral            Vice President and Chief                         6 years                 47
                             Accounting Officer of
                             Elcor Corporation; Director of
                             one subsidiary

Raul G. Holguin              Vice President Information Systems               2 years                 42
                             of Elcor Corporation; President of
                             Cybershield, Inc., a subsidiary, and
                             its subsidiaries

David G. Sisler              Vice President, General Counsel and              4 years                 41
                             Secretary of Elcor Corporation; Officer
                             of all subsidiaries; Director of
                             one subsidiary

James J. Waibel              Vice President Administration                    6 years                 55
                             of Elcor Corporation
</TABLE>



                                       10
<PAGE>   12



         All of the executive officers except Mr. Sisler have been employed by
the Registrant or its subsidiaries in responsible management positions for more
than the past five years. In July 1996, Mr. Rosebery and Mr. Work were appointed
as Directors of the Registrant. On August 18, 1997, Mr. Work and Mr. Rosebery
were each elected as Vice Chairmen. On August 26, 1997, Mr. Work was elected as
Chairman of the Board, President and Chief Executive Officer of the Registrant
following the death on August 22, 1997 of Mr. Roy E. Campbell, who previously
held those positions. In June 1997, Mr. Holguin was elected as Vice President,
Information Systems. Previously Mr. Holguin was Assistant Vice President,
Information Systems.

         On August 14, 1995, Mr. Sisler was appointed by the Board of Directors
as Vice President, General Counsel and Secretary of the Registrant. Mr. Sisler
was employed by Central and South West Corporation from 1991 to 1995, most
recently as a Senior Attorney. Mr. Sisler has practiced law for more than
fifteen years and his responsibilities have included corporate, securities and
other business legal matters in several industries.

         Officers are elected annually by the Board of Directors.


                                       11
<PAGE>   13


                                     PART II

Item 5. Market for the Registrant's Common Stock and Related Stockholder Matters

         The principal market on which the Registrant's common stock is traded
is the New York Stock Exchange. Registrant's common stock is also traded on the
Boston, Midwest and Philadelphia Stock Exchanges. There were 964 holders of
record and approximately 3,438 beneficial shareholders of the Registrant's
common stock at September 7, 1999.

         The quarterly dividend declared per share and the high and low prices
in dollars per share on Registrant's common stock for each quarter during fiscal
year 1999 and fiscal year 1998, adjusted for a three-for-two stock split
declared in June 1999, are set forth in the following tables:

<TABLE>
<CAPTION>

Period                    Dividend   High     Low
------                    --------   ----     ---

<S>                         <C>     <C>      <C>
Fiscal 1999

    First Quarter           $.047   $17.00   $12.88
    Second Quarter          $.047    21.92    13.13
    Third Quarter           $.047    25.50    19.92
    Fourth Quarter          $ .05    29.33    21.38

Fiscal 1998

    First Quarter           $ .04   $14.46   $12.33
    Second Quarter          $ .04    16.33    14.42
    Third Quarter           $ .04    18.29    13.67
    Fourth Quarter          $ .04    18.83    16.50
</TABLE>

         After the completion of a previous stock repurchase program authorized
in 1994, in September 1998, the Registrant's Board of Directors authorized the
purchase of up to $10,000,000 of additional common shares from time to time on
the open market to be used for general corporate purposes. As of June 30, 1999,
129,992 shares with cumulative cost of $1,771,000 had been repurchased under the
new repurchase program. In June 1999, the regular quarterly cash dividend was
increased to $.05 per common share (after giving effect to a stock split) and a
three-for-two stock split payable in the form of a stock dividend was declared,
to be distributed on August 11, 1999 to shareholders of record on July 15, 1999.

         The limitations affecting the future payment of dividends by Registrant
imposed as a part of the Registrant's revolving credit agreement are discussed
under the caption "Notes to Consolidated Financial Statements" under the heading
"Long-Term Debt" on page 32 of this Annual Report on Form 10-K.


                                       12
<PAGE>   14


Item 6.  Selected Financial Data

        The following selected consolidated financial data for each of the five
years in the period ended June 30, 1999 have been derived from the audited
consolidated financial statements of the Registrant included herein. The
selected consolidated financial data set forth below should be read in
conjunction with "Management's Discussion and Analysis of Financial Condition
and Results of Operations" and the consolidated financial statements and notes
thereto included elsewhere in this report.


FIVE-YEAR SUMMARY OF SELECTED FINANCIAL DATA

<TABLE>
<CAPTION>

($ In thousands, except per share data)                          Year Ended June 30,
                                           --------------------------------------------------------------
                                              1999         1998          1997       1996(2)       1995
                                           ----------   ----------   ----------   ----------   ----------

<S>                                        <C>          <C>          <C>          <C>          <C>
SALES                                      $  317,874   $  268,178   $  230,756   $  196,462   $  159,061
                                           ==========   ==========   ==========   ==========   ==========

INCOME:
  Before cumulative effect of
  accounting change                        $   25,283   $   18,324   $   12,276   $   10,676   $   10,076
  Cumulative effect of accounting
  change                                       (4,340)          --           --           --           --
                                           ----------   ----------   ----------   ----------   ----------

NET INCOME                                 $   20,943   $   18,324   $   12,276   $   10,676   $   10,076
                                           ==========   ==========   ==========   ==========   ==========

INCOME PER SHARE BEFORE CUMULATIVE
EFFECT OF ACCOUNTING CHANGE -
BASIC(1)                                   $     1.29   $      .92   $      .62   $      .54   $      .51
                                           ==========   ==========   ==========   ==========   ==========

INCOME PER SHARE BEFORE CUMULATIVE
EFFECT OF ACCOUNTING CHANGE -
DILUTED(1)                                 $     1.27   $      .90   $      .62   $      .53   $      .51
                                           ==========   ==========   ==========   ==========   ==========

NET INCOME PER SHARE - BASIC(1)            $     1.07   $      .92   $      .62   $      .54   $      .51
                                           ==========   ==========   ==========   ==========   ==========

NET INCOME PER SHARE - DILUTED(1)          $     1.05   $      .90   $      .62   $      .53   $      .51
                                           ==========   ==========   ==========   ==========   ==========

TOTAL ASSETS                               $  252,182   $  217,044   $  206,449   $  192,060   $  136,673
                                           ==========   ==========   ==========   ==========   ==========

LONG-TERM DEBT                             $   63,000   $   48,000   $   52,600   $   53,000   $   18,400
                                           ==========   ==========   ==========   ==========   ==========

SHAREHOLDERS' EQUITY                       $  137,251   $  125,956   $  111,986   $  102,130   $   93,156
                                           ==========   ==========   ==========   ==========   ==========

CASH DIVIDENDS PER SHARE(1)                $      .19   $      .16   $      .13   $      .11           --
                                           ==========   ==========   ==========   ==========   ==========
</TABLE>



(1)      Adjusted for a three-for-two stock split declared in June 1999.

(2)      1996 results include $1,595 in pretax charges in connection with a
         provision for the adoption of SFAS No. 121 and a previous reduction in
         value of certain other assets.


                                       13
<PAGE>   15






Item 7. Management's Discussion and Analysis of Financial Condition and Results
of Operations

RESULTS OF OPERATIONS

OPERATING SEGMENTS

         In accordance with the requirements of FASB SFAS No. 131, the company
is segregated into two segments: Roofing Products and Industrial Products. The
Roofing Products Group consists of the various operating subsidiaries of Elk
Corporation of Dallas (collectively Elk). These companies manufacture and sell
premium laminated fiberglass asphalt residential and accessory roofing products,
together with nonwoven mats used in manufacturing asphalt roofing products and
various industrial applications. Elk accounted for 88% of consolidated sales in
fiscal 1999.

         The Industrial Products Group is comprised of three diverse businesses:
(1) conductive coatings used in digital wireless cellular phones and in other
electronic equipment; (2) remanufactured reciprocating engine components used in
the railroad and marine transportation industries; and (3) technology licensing
and consulting services for the natural gas processing industry. None of the
three Industrial Products businesses individually accounted for 10% of
consolidated sales, operating income or assets in fiscal 1999.

         Historically, the first two businesses in the Industrial Products Group
were operated as separate divisions of Chromium Corporation. Effective July 1,
1999, Chromium's operations were segregated into separate companies.
Reciprocating engine components will continue to do business as Chromium
Corporation and conductive coatings will be operated as subsidiaries of
Cybershield, Inc. The technology licensing and consulting services business
will continue to be conducted as Ortloff Engineers, Ltd.

FISCAL 1999 COMPARED TO FISCAL 1998

         During the fiscal year ended June 30, 1999, income before the
cumulative effect of a change in accounting principle increased 38% to
$25,283,000 from $18,324,000 in fiscal 1998. Sales increased 19% compared to the
prior fiscal year. The increases in sales and income before the accounting
change were primarily the result of increased production, a record level of
shipments of premium laminated fiberglass asphalt shingles, and accelerating
demand for the company's Compushield(R) products used in digital wireless
cellular phones. In the first quarter of fiscal 1999, the company adopted
Statement of Position 98-5, "Reporting on the Costs of Start-Up Activities,"
issued by the Accounting Standards Executive Committee of the American Institute
of Certified Public Accountants, which resulted in a $4,340,000 charge, net of
tax, for the cumulative effect of this accounting change. This one-time
cumulative charge reduced net income for fiscal 1999 to $20,943,000 compared to
$18,324,000 in the prior fiscal year.

         Sales for the Roofing Products Group increased 22% in fiscal 1999 to
$278,918,000 from $229,475,000 in fiscal 1998. Each of the company's three
roofing plants recorded increased sales as a result of strong demand in most
regions of the United States. Elk's shipments were aided by relatively mild
weather during the winter months (which permitted increased roofing activity in
Elk's seasonally slower period) together with sharply higher demand throughout
the






                                       14
<PAGE>   16


fiscal year in the residential roofing replacement market. Average selling
prices were slightly higher in fiscal 1999 compared to fiscal 1998 and customer
discounts were lower.

         Operating income for the Roofing Products Group increased 81% in fiscal
1999 to $45,061,000 from $24,885,000 in fiscal 1998. Each of the three roofing
plants achieved significantly higher operating income in fiscal 1999 as compared
to fiscal 1998 as a result of increased manufacturing output and a record level
of shipments of premium laminated fiberglass asphalt shingles. Elk's nonwoven
fiberglass roofing mat plant also contributed to improved results for the
Roofing Products Group. However, a dryer on one production line was damaged by
an explosion on September 15, 1998 and the damaged line was shut down or ran at
curtailed line speeds for much of fiscal 1999. Due to the company's property
damage and business interruption insurance policies, this explosion did not have
a material effect on the company's results of operations, financial position or
liquidity. As of June 1999, the plant was again running at line speeds
equivalent to line speeds at the time of the explosion.

         The company currently anticipates continued strong demand for its
premium laminated asphalt shingles and mat products in fiscal 2000. The company
expects certain raw material costs, particularly asphalt and fiberglass, and
shipping and warehousing costs to increase in fiscal year 2000. However, the
company believes that anticipated increases in these costs can be offset by
price increases on its products, improved manufacturing efficiencies, better raw
material usage, and freight and warehousing strategies to maximize shipments.

         Sales for the Industrial Products Group increased 1% in fiscal 1999 to
$38,816,000 from $38,586,000 in fiscal 1998. Operating income for this Group
decreased to $3,566,000 in fiscal 1999 from $10,780,000 in fiscal 1998. During
fiscal 1999, the company continued to benefit from strong demand for
Compushield(R) conductive coatings and formed-in-place dispense gaskets used in
digital wireless cellular phones and other electronic products. Improved sales
and operating results for conductive coatings, however, were offset by lower
sales and reduced income at Chromium's Reciprocating Engine Components Division
and at Ortloff Engineers. The Reciprocating Engine Components Division
experienced lower demand for remanufactured large diesel engine components used
in the railroad and marine transportation industries, due primarily to further
consolidation of the railroad industry and a reduction in maintenance
requirements by some of its customers. Chromium is consolidating its operations
to its Cleveland, Ohio facility. Estimated costs to relocate equipment and other
consolidation items of $1,145,000 are expected to be incurred and expensed in
the first half of fiscal 2000. Severance costs of $375,000 relating to
terminating employees at its Lufkin, Texas facility were recorded in fiscal
1999. In the fourth quarter of fiscal 1999, Chromium also recorded a $250,000
pretax charge to settle some long-standing third party tort litigation.

         Ortloff's patent licensing and engineering consulting services to the
petroleum industry were significantly lower in fiscal 1999 as a result of
depressed oil prices during much of the fiscal year, causing many of its
customers to temporarily reduce capital spending plans. Prospects for fiscal
2000 are improved due to a recovery of oil prices in the latter half of fiscal
1999.

         On January 11, 1999, a subsidiary of the company acquired YDK America,
Inc. (renamed Cybershield of Georgia, Inc. in June 1999). Operations of this
acquired company were included in fiscal 1999 operations subsequent to its
acquisition, but were not material.




                                       15
<PAGE>   17

         Overall selling, general and administrative (SG&A) costs in fiscal 1999
increased 13.5% from fiscal 1998, primarily as a result of increased business
activity. As a percentage of sales, SG&A costs in fiscal 1999 declined to 12.5%
of sales from 13.0% in fiscal 1998.

         Interest expense in fiscal 1999 was $2,059,000 compared to $2,577,000
in fiscal 1998. In fiscal 1999, the company capitalized $595,000 in interest
costs in connection with the construction of major projects, compared to
$160,000 capitalized in fiscal 1998.

FISCAL 1998 COMPARED TO FISCAL 1997

         During the fiscal year ended June 30, 1998, sales increased 16% to
$268,178,000 from the $230,756,000 reported in fiscal 1997. Net income in fiscal
1998 increased 49% to $18,324,000 from $12,276,000 in the prior fiscal year.
Both the Roofing Products and Industrial Products Groups generated significant
increases in sales. The Roofing Products Group reported better operating results
in fiscal 1998 as compared to the prior fiscal year. However, the substantial
increase in net income was primarily attributable to increased demand and
dramatically improved operating results in each of the Industrial Products
Group's principal operations.

         Sales for the Roofing Products Group increased 11% in fiscal 1998 to
$229,475,000 from $207,017,000 in fiscal 1997. The Western United States
produced very strong demand for Elk Prestique premium laminated shingles.
However, shipments on the West Coast were limited during much of the second half
of fiscal 1998 by El Nino's impact, as many roofing contractors could not
replace leaking roofs during extended periods of heavy rainfall. Demand was also
higher in the Southeast, Midwest and North regions. Only in the Southwestern
region was demand lower than in the previous fiscal year. Average selling prices
were about the same in fiscal 1998 compared to fiscal 1997.

         Elk's roofing mat operations achieved significantly higher sales and
operating profit, primarily as a result of growing demand for its high quality
roofing mats and specialty industrial products.

         Operating income for the Roofing Products Group increased 18% in fiscal
1998 to $24,885,000 from $21,052,000 in fiscal 1997. Each of Elk's three roofing
plants and its roofing mat operation were very profitable in fiscal 1998,
although the Ennis, Texas roofing plant's operating results were lower in fiscal
1998 as a result of lower demand in the Southwestern region. The impact of high
winds and heavy rainfall in much of the nation during the winter months
increased the level of demand during the latter months of fiscal 1998.

         Sales for the Industrial Products Group increased 64% in fiscal 1998 to
$38,586,000 from $23,542,000 in fiscal 1997. Operating income for this Group
increased to $10,780,000 in fiscal 1998 from $3,498,000 in fiscal 1997. Each of
the three principal operations in this business segment reported significantly
higher sales and operating income in fiscal 1998. Cybershield continued to
benefit from strong demand for its Compushield conductive coatings and dispense
conductive gasketing used in digital wireless cellular phones and in other
electronic equipment. Chromium also experienced higher sales and significantly
improved margins in plating certain proprietary finishes for large diesel engine
components during fiscal 1998. Further, Ortloff Engineers' revenues from its
technology licensing and consulting services for the natural gas


                                       16
<PAGE>   18


processing industry about doubled in fiscal 1998 as compared to fiscal 1997.
This resulted in a tripling of operating income for this business activity in
fiscal 1998.

         SG&A costs in fiscal 1998 increased 12.9% from fiscal 1997 primarily as
a result of increased business activity. As a percentage of sales, SG&A costs
declined to 13.0% of sales in fiscal 1998 from 13.4% of sales in fiscal 1997.

         Interest expense in fiscal 1998 was $2,577,000 compared to $1,136,000
in fiscal 1997. In fiscal 1997, $1,784,000 of interest was capitalized in
connection with the company's major facilities expansion program. In fiscal
1998, the company capitalized $160,000 in interest costs in connection with its
existing plant expansion program.

LIQUIDITY AND CAPITAL RESOURCES

         The company generated cash flows from operating activities of
$23,391,000 in fiscal 1999, despite a $12,079,000 increase in working capital.
The increase in working capital was primarily the result of higher trade
receivables and a receivable from an insurance company relating to an explosion
at the company's nonwoven fiberglass roofing mat plant. Trade receivables
increased primarily as a result of higher sales activities, especially during
the last two months of fiscal 1999 (the period to which most outstanding trade
receivables apply), when the company achieved a 28% year to year increase. At
June 30, 1999, deferred payment term receivables from promotional programs to
certain customers were $3,468,000 compared to $6,299,000 at June 30, 1998.
Deferred receivables outstanding at June 30, 1999, are primarily due during the
first four months of fiscal 2000. The increase in receivables was partially
offset by lower inventories and higher current liabilities. The current ratio
was 3.3 to 1 at June 30, 1999 and 3.5 to 1 at June 30, 1998. Historically,
working capital requirements and associated borrowings fluctuate during the year
because of seasonality in some market areas. Generally, working capital
requirements and borrowings are higher in the spring and summer, and lower in
the fall and winter.

         The company used $29,797,000 for net investing activities in fiscal
1999. The majority of investing expenditures were for additions to property,
plant and equipment. Capital expenditures totaling approximately $5,500,000 in
fiscal 1999 relate to replacement of equipment at the Ennis, Texas mat plant
damaged by an explosion. Most of the expenditures incurred to replace damaged
equipment are expected to be covered by the company's property damage insurance
policy. The majority of other fiscal 1999 capital expenditures are a
continuation of productivity, capacity and cost improvement projects at its
existing roofing and conductive coatings facilities, capital costs associated
with developing new computer systems and expenditures relating to a fourth major
laminated shingle plant. In January 1999 a subsidiary of the company acquired
YDK America, Inc. for approximately $5,588,000 to expand capacity for its
conductive coatings business. The company expects to invest about $137,000,000
over a three-year period beginning in fiscal 2000 to expand capacity and improve
productivity at existing plants, to install production facilities for new
products, to build a new roofing plant, and to increase capacity for
Cybershield's conductive coatings business.

         Cash flows provided by financing activities were $5,352,000 during
fiscal 1999, primarily resulting from a $15,000,000 increase in long-term debt,
offset by dividend payments and purchases of treasury shares. Long-term debt
represented 31% of the $200,251,000 of invested capital (long-term debt plus
shareholders' equity) at June 30, 1999. At June 30, 1999,


                                       17
<PAGE>   19


$34,860,000 was available under the company's $100,000,000 unsecured revolving
line of credit. During fiscal 1999, the company purchased 429,900 shares of its
common shares on the open market under SEC Rule 10b-18 at a total cost of
$6,305,000 and completed the $10,000,000 stock repurchase program authorized by
the Board of Directors in September 1994. On September 28, 1998, the Board of
Directors authorized an additional $10,000,000 stock repurchase program.

         In June 1999, the Board of Directors increased the regular quarterly
cash dividend to five cents per common share (after giving effect to a stock
split) and declared a three-for-two stock split payable in the form of a stock
dividend distributed on August 11, 1999 to shareholders of record on July 15,
1999.

         The company is planning to increase its unsecured revolving credit
facility from $100,000,000 to $125,000,000 in fiscal 2000 to support its capital
expansion program. Management believes that current cash and cash equivalents,
cash flows from operations and its unsecured revolving credit facility should be
sufficient during fiscal 2000 and beyond to fund its planned capital
expenditures, working capital needs, dividends, stock repurchases and other cash
requirements.

NEW ACCOUNTING STANDARDS

         In June 1997, FASB issued SFAS No. 130, "Reporting Comprehensive
Income," which establishes standards of reporting of comprehensive income and
its components in the consolidated financial statements. The company adopted
SFAS No. 130 in fiscal 1999. The adoption of SFAS No. 130 had no effect on the
consolidated financial statements as the company has no items that are required
to be included as components of comprehensive income.

         Also in June 1997, the FASB issued SFAS No. 131, "Disclosures about
Segments of an Enterprise and Related Information." SFAS No. 131 requires public
companies to disclose, among other things, certain interim and annual financial
information about the enterprise using a new management approach. The management
approach requires segment information to be reported based on how management
evaluates the operating performance of its business units or segments. The
company adopted SFAS No. 131 in fiscal 1999, but this adoption did not change
the company's reportable segments.

         In February 1998, the FASB issued SFAS No. 132, "Employers' Disclosures
about Pensions and Other Post Retirement Benefits." The company has no
significant pension or post retirement benefit plans affected by this statement.

         In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities." At June 30, 1999, the company has entered
into no significant derivative instruments or hedging activities, although the
company regularly reviews the potential benefits of interest rate swap
arrangements and may enter into derivative instruments from time to time in the
future.



                                       18
<PAGE>   20


YEAR 2000 ISSUE

         The company is currently developing a new information system for most
of its critical financial, distribution and manufacturing applications. The
system is scheduled for completion and implementation before December 31, 1999
at an estimated total cost of about $11,000,000. While the primary purpose of
this new information system is to modernize and improve the company's
operations, it is also expected to resolve the Year 2000 issues in these
critical computer systems. Costs to develop this new information system are
being capitalized. Other costs relating to Year 2000 readiness are being
expensed as incurred. As of June 30, 1999, the company's expenditures for its
new information system have been $9,032,000, and its expenditures for its Year
2000 readiness projects have been less than $300,000. At this time, other than
the cost of developing and implementing its new information system, the company
does not believe that the costs of addressing the Year 2000 issue will be
material. The company does not believe that other critical information systems
work has been deferred due to its Year 2000 efforts.

         Using teams of employees and consultants, the company has completed its
review and testing of other computer applications and systems not included in
the scope of the new information system, including embedded technology, for Year
2000 readiness. The company expects to have completed any required remediation
before January 1, 2000. The company has developed contingency plans for its
critical information system which primarily consist of making its existing
information system Year 2000 compliant in the event the new system is not
completed by its scheduled date. The company has completed and tested its
remedial programming for its existing computer system and believes this system
to be Year 2000 compliant.

         The company has made inquiries of key suppliers and other third parties
with whom it has significant business relationships to assess their state of
readiness in addressing Year 2000 issues that could adversely impact the
company. The company has requested a written response from those third parties
that they will be Year 2000 compliant by the end of calendar 1999. The company
has no means of ensuring that its business partners will be fully Year 2000
compliant. Contingency plans for what the company determines to be the most
reasonably and likely worst case scenario are being developed. Disruptions of
financial markets or computer system failure at government agencies, financial
institutions, utilities and others on which the company is dependent could
adversely affect the company. The effects of a potential disruption at these
entities cannot be determined at this time.

         The company believes the Year 2000 readiness project is on schedule for
timely completion. Based on a current assessment of risks relating to its Year
2000 readiness, the company does not believe that this issue will result in
uncertainty that is reasonably likely to materially affect future financial
results or operating performance.



                                       19
<PAGE>   21


FORWARD-LOOKING STATEMENTS

         In an effort to give investors a well-rounded view of the company's
current condition and future opportunities, management's discussion and analysis
of the results of operations and financial condition and other sections of this
Form 10-K contain "forward-looking statements" about its prospects for the
future. Such statements are subject to certain risks and uncertainties which
could cause actual results to differ materially from those projected. Such risks
and uncertainties include, but are not limited to the following:

         1.       The company's roofing products business is substantially
                  non-cyclical, but can be affected by weather and the
                  availability of financing and general economic conditions. In
                  addition, the asphalt roofing products manufacturing business
                  is highly competitive. Actions of competitors, including
                  changes in pricing, or slowing demand for asphalt roofing
                  products due to general or industry economic conditions or the
                  amount of inclement weather could result in decreased demand
                  for the company's products, lower prices received or reduced
                  utilization of plant facilities. Further, changes in building
                  codes and other standards from time to time can cause changes
                  in demand, or increases in costs that may not be passed
                  through to customers.

         2.       In the asphalt roofing products business, the significant raw
                  materials are ceramic coated granules, asphalt, glass fibers,
                  resins and mineral filler. Increased costs of raw materials
                  can result in reduced margins, as can higher trucking and rail
                  costs. Historically, the company has been able to pass some of
                  the higher raw material and transportation costs through to
                  the customer. Should the company be unable to recover higher
                  raw material and/or transportation costs from price increases
                  of its products, operating results could be lower than
                  projected.

         3.       During fiscal 1997, the company completed the construction of
                  a plant at the company's Ennis, Texas facility to manufacture
                  nonwoven fiberglass roofing mats and other mats for a variety
                  of industrial uses. The company also expects to make about
                  $137 million in new investments to expand capacity and improve
                  productivity at existing plants and to build new plants over a
                  three year period beginning in fiscal 2000. Progress in
                  achieving anticipated operating efficiencies and financial
                  results is difficult to predict for new plant facilities. If
                  such progress is slower than anticipated, if substantial cost
                  overruns occur in building new plants, or if demand for
                  products produced at new plants does not meet current
                  expectations, operating results could be adversely affected.

         4.       Certain facilities of the company's industrial products
                  subsidiaries must utilize hazardous materials in their
                  production process. As a result, the company could incur costs
                  for remediation activities at its facilities or off-site, and
                  other related exposures from time to time in excess of
                  established reserves for such activities.

         5.       The company's litigation, including its patent infringement
                  suits against GAF Building Materials Corporation and certain
                  affiliates, is subject to inherent and case-specific
                  uncertainty. The outcome of such litigation depends on
                  numerous interrelated factors, many of which cannot be
                  predicted.





                                       20
<PAGE>   22


         6.       Even with fully developed action and contingency plans for
                  Year 2000 readiness, it is possible that the company will not
                  achieve full internal readiness. Further, the company's
                  business may be adversely affected by external Year 2000
                  disruption that the company is not in position to control,
                  including but not limited to potential disruptions in power
                  and other energy supplies, telecommunications or other
                  infrastructure, potential disruptions in transportation and
                  the supply of raw materials, and potential disruptions in
                  financial and banking systems. Year 2000 problems therefore
                  could result in unanticipated expenses or liabilities,
                  production or disruption delays or other adverse effects on
                  the company.

         7.       Although the company currently anticipates that most of its
                  needs for new capital in the near future will be met with
                  internally generated funds and borrowings under its unsecured
                  revolving credit facilities, significant increases in interest
                  rates could substantially affect its borrowing costs under its
                  existing loan facility, or its cost of alternative sources of
                  capital.

         8.       Each of the company's businesses, especially Cybershield's
                  conductive coatings business, is subject to the risks of
                  technological changes that could affect the demand for or the
                  relative cost of the company's products and services, or the
                  method and profitability of the method of distribution or
                  delivery of such products and services. In addition, the
                  company's businesses each could suffer significant setbacks in
                  revenues and operating income if it lost one or more of its
                  largest customers.

         9.       Although the company insures itself against physical loss to
                  its manufacturing facilities, including business interruption
                  losses, natural or other disasters and accidents, including
                  but not limited to fire, earthquake, damaging winds and
                  explosions, operating results could be adversely affected if
                  any of its manufacturing facilities became inoperable for an
                  extended period of time due to such events.

         10.      Each of the company's businesses is actively involved in the
                  development of new products, processes and services which are
                  expected to contribute to the company's long-term growth and
                  earnings. If such development activities are not successful,
                  or the company cannot provide the requisite financial and
                  other resources to successfully commercialize such
                  developments, the growth of future sales and earnings may be
                  adversely affected.

Parties are cautioned not to rely on any such forward-looking beliefs or
judgments in making investment decisions.

Item 7A. Quantitative and Qualitative Disclosures about Market Risk

         The Registrant's exposure to market risk from changes in foreign
currency risk is not material. The Registrant's outstanding debt has a variable
interest rate. Changes in market rates effect interest paid by the Registrant.
The Registrant has not entered into any significant derivative instruments or
hedging activities, although the Registrant regularly reviews the potential
benefits of interest rate swap arrangements and may enter into derivative
instruments from time to time in the future.


                                       21
<PAGE>   23


Item 8. Financial Statements and Supplemental Data

         Index to Financial Statements and Financial Statement Schedule


<TABLE>
<CAPTION>
Financial Statements:                                                             Page

<S>                                                                              <C>
Independent Auditors' Report                                                       23
Consolidated Balance Sheet at June 30, 1999 and 1998                               24
Consolidated Statement of Operations for the years ended
  June 30, 1999, 1998, and 1997                                                    25
Consolidated Statement of Cash Flows for the years ended
  June 30, 1999, 1998, and 1997                                                    26
Consolidated Statement of Shareholders' Equity for the years
  ended June 30, 1999, 1998, and 1997                                              27
Notes to Consolidated Financial Statements                                         31

Financial Statement Schedule:

Independent Auditors' Report                                                       41
Schedule II - Consolidated Valuation and Qualifying Accounts and Reserves          42
</TABLE>

All other schedules are omitted because they are not required, are not
applicable, or the information is included in the financial statements or notes
thereto.



                                       22
<PAGE>   24


INDEPENDENT AUDITORS' REPORT

To the Shareholders and Board of Directors,
Elcor Corporation

         We have audited the accompanying consolidated balance sheets of Elcor
Corporation (a Delaware corporation) and subsidiaries as of June 30, 1999 and
1998, and the related consolidated statements of operations, shareholders'
equity and cash flows for each of the three years then ended June 30, 1999.
These financial statements are the responsibility of the company's management.
Our responsibility is to express an opinion on these financial statements based
on our audits.

         We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

         In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of Elcor
Corporation and subsidiaries as of June 30, 1999 and 1998, and the results of
their operations and their cash flows for each of the three years then ended
June 30, 1999, in conformity with generally accepted accounting principles.



                                                   /s/ Arthur Andersen LLP
                                                   -----------------------------
                                                       Arthur Andersen LLP




Dallas, Texas
   August 16, 1999




                                       23
<PAGE>   25


CONSOLIDATED BALANCE SHEET

<TABLE>
<CAPTION>
($ In thousands)                                                           June 30,
                                                                 ----------------------------
ASSETS                                                               1999            1998
                                                                 ------------    ------------
<S>                                                              <C>             <C>
CURRENT ASSETS
    Cash and cash equivalents                                    $      4,186    $      5,240
    Trade receivables, less allowance of $967 and $580                 72,866          56,450
    Inventories                                                        25,770          28,822
    Prepaid expenses, insurance receivable and other                    8,352           1,789
    Deferred income taxes                                               2,111           2,228
                                                                 ------------    ------------
    Total current assets                                              113,285          94,529
                                                                 ------------    ------------

PROPERTY, PLANT AND EQUIPMENT, AT COST
    Land                                                                2,789           2,194
    Buildings                                                          42,775          35,835
    Machinery and equipment                                           147,923         149,369
    Construction in progress                                           19,217           6,735
                                                                 ------------    ------------
                                                                      212,704         194,133
    Less - Accumulated depreciation                                   (76,984)        (73,401)
                                                                 ------------    ------------
    Property, plant and equipment, net                                135,720         120,732
                                                                 ------------    ------------

OTHER ASSETS                                                            3,177           1,783
                                                                 ------------    ------------
                                                                 $    252,182    $    217,044
                                                                 ============    ============


LIABILITIES AND SHAREHOLDERS' EQUITY


CURRENT LIABILITIES
    Accounts payable                                             $     18,067    $     14,579
    Accrued liabilities                                                15,817          12,628
                                                                 ------------    ------------
    Total current liabilities                                          33,884          27,207
                                                                 ------------    ------------

LONG-TERM DEBT                                                         63,000          48,000
                                                                 ------------    ------------

DEFERRED INCOME TAXES                                                  18,047          15,881
                                                                 ------------    ------------

COMMITMENTS AND CONTINGENCIES  (See Note)

SHAREHOLDERS' EQUITY
    Common stock ($1 par, 19,988,354 shares issued)                    19,988          19,988
    Paid-in capital                                                    59,586          61,200
    Retained earnings                                                  64,632          47,394
                                                                 ------------    ------------
                                                                      144,206         128,582
    Less - Treasury stock (465,149 and 150,635 shares at cost)         (6,955)         (2,626)
                                                                 ------------    ------------
    Total shareholders' equity                                        137,251         125,956
                                                                 ------------    ------------
                                                                 $    252,182    $    217,044
                                                                 ============    ============
</TABLE>


================================================================================
The Summary of Significant Accounting Policies and Notes to Consolidated
Financial Statements are an integral part of this statement.


                                       24
<PAGE>   26


CONSOLIDATED STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
($ In thousands, except per share data)                                Year Ended June 30,
                                                                -----------------------------------
                                                                   1999         1998         1997
                                                                ---------    ---------    ---------

<S>                                                             <C>          <C>          <C>
SALES                                                           $ 317,874    $ 268,178    $ 230,756
                                                                ---------    ---------    ---------

COSTS AND EXPENSES

    Cost of goods sold                                            236,670      202,627      179,381
    Selling, general and administrative                            39,699       34,962       30,969
                                                                ---------    ---------    ---------
INCOME FROM OPERATIONS                                             41,505       30,589       20,406
                                                                ---------    ---------    ---------

OTHER INCOME (EXPENSE)

    Interest expense                                               (2,059)      (2,577)      (1,136)
    Other income                                                       84          446          215
                                                                ---------    ---------    ---------

INCOME BEFORE INCOME TAXES                                         39,530       28,458       19,485

    Provision for income taxes                                     14,247       10,134        7,209
                                                                ---------    ---------    ---------

INCOME BEFORE CUMULATIVE EFFECT OF CHANGE IN
ACCOUNTING PRINCIPLE                                               25,283       18,324       12,276

CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE                (4,340)          --           --
                                                                ---------    ---------    ---------

NET INCOME                                                      $  20,943    $  18,324    $  12,276
                                                                =========    =========    =========

INCOME PER COMMON SHARE-BASIC:
   Before cumulative effect of change in accounting principle   $    1.29    $     .92    $     .62
   Cumulative effect of change in accounting principle               (.22)          --           --
                                                                ---------    ---------    ---------
   Net income per share                                         $    1.07    $     .92    $     .62
                                                                =========    =========    =========

INCOME PER COMMON SHARE-DILUTED:
   Before cumulative effect of change in accounting principle   $    1.27    $     .90    $     .62
   Cumulative effect of change in accounting principle               (.22)          --           --
                                                                ---------    ---------    ---------
   Net income per share                                         $    1.05    $     .90    $     .62
                                                                =========    =========    =========
</TABLE>


================================================================================
The Summary of Significant Accounting Policies and Notes to Consolidated
Financial Statements are an integral part of this statement.



                                       25
<PAGE>   27



CONSOLIDATED STATEMENT OF CASH FLOWS

<TABLE>
<CAPTION>
($ In thousands)                                                          Year Ended June 30,
                                                                 --------------------------------------
                                                                    1999          1998          1997
                                                                 ----------    ----------    ----------

<S>                                                              <C>           <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES

Net income                                                       $   20,943    $   18,324    $   12,276
Adjustments to reconcile net income to net cash from
operating activities:
    Depreciation and amortization                                     9,285        11,056         8,664
    Cumulative effect of accounting change                            4,340            --            --
    Deferred income taxes                                             2,283         3,010         5,042
    Changes in assets and liabilities:
        Trade receivables                                           (15,420)      (13,272)         (696)
        Inventories                                                   3,375         3,384        (5,527)
        Prepaid expenses, insurance receivable and other             (6,552)        1,783        (1,616)
        Accounts payable                                              2,421        (1,320)          396
        Accrued liabilities                                           2,716           242          (705)
                                                                 ----------    ----------    ----------
    Net cash provided by operating activities                        23,391        23,207        17,834
                                                                 ----------    ----------    ----------

CASH FLOWS FROM INVESTING ACTIVITIES

Additions to property, plant and equipment                          (30,048)      (14,288)      (15,896)
Insurance proceeds from involuntary conversion                        5,687            --            --
Acquisition of business, net of cash                                 (5,588)           --            --
Other, net                                                              152         1,674           739
                                                                 ----------    ----------    ----------
    Net cash used for investing activities                          (29,797)      (12,614)      (15,157)
                                                                 ----------    ----------    ----------

CASH FLOWS FROM FINANCING ACTIVITIES

Long-term debt borrowings (repayments)                               15,000        (4,600)         (400)
Dividends paid on common stock                                       (3,705)       (3,175)       (2,462)
Treasury stock transactions and exercises of stock options,
net                                                                  (5,943)       (1,179)           42
                                                                 ----------    ----------    ----------
    Net cash provided by (used for) financing activities              5,352        (8,954)       (2,820)
                                                                 ----------    ----------    ----------

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                 (1,054)        1,639          (143)
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR                        5,240         3,601         3,744
                                                                 ----------    ----------    ----------
CASH AND CASH EQUIVALENTS AT END OF YEAR                         $    4,186    $    5,240    $    3,601
                                                                 ==========    ==========    ==========
</TABLE>



================================================================================
The Summary of Significant Accounting Policies and Notes to Consolidated
Financial Statements are an integral part of this statement.


                                       26
<PAGE>   28


CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY

<TABLE>
<CAPTION>
($ In thousands, except per share data)
                                                                                           Total
                                        Common     Paid-in      Retained     Treasury   Shareholders'
                                        Stock      Capital      Earnings       Stock       Equity
                                      ----------  ----------   ----------   ----------   ----------

<S>                                   <C>         <C>          <C>          <C>          <C>
BALANCE, June 30, 1996                $   19,805  $   60,552   $   22,431   $     (658)  $  102,130

Net income                                    --          --       12,276           --       12,276
Treasury stock purchases                      --          --           --         (831)        (831)
Exercises of stock options, net               27        (220)          --        1,066          873
Dividends, $.13 per share                     --          --       (2,462)          --       (2,462)
                                      ----------  ----------   ----------   ----------   ----------

BALANCE, June 30, 1997                    19,832      60,332       32,245         (423)     111,986

Net income                                    --          --       18,324           --       18,324
Treasury stock purchases                      --          --           --       (3,195)      (3,195)
Exercises of stock options, net              156         868           --          992        2,016
Dividends, $.16 per share                     --          --       (3,175)          --       (3,175)
                                      ----------  ----------   ----------   ----------   ----------

BALANCE, June 30, 1998                    19,988      61,200       47,394       (2,626)     125,956

Net income                                    --          --       20,943           --       20,943
Treasury stock purchases                      --          --           --       (6,305)      (6,305)
Exercises of stock options, net               --      (1,614)          --        1,976          362
Dividends, $.19 per share                     --          --       (3,705)          --       (3,705)
                                      ----------  ----------   ----------   ----------   ----------

BALANCE, June 30, 1999                $   19,988  $   59,586   $   64,632   $   (6,955)  $  137,251
                                      ==========  ==========   ==========   ==========   ==========
</TABLE>


================================================================================
The Summary of Significant Accounting Policies and Notes to Consolidated
Financial Statements are an integral part of this statement.


                                       27
<PAGE>   29



SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

DESCRIPTION OF BUSINESS

         Elcor Corporation (the company), through subsidiaries, is engaged in
two lines of business: Roofing Products and Industrial Products. The Roofing
Products segment, which accounts for 88% of consolidated sales, manufactures and
sells premium laminated fiberglass asphalt residential shingles and accessory
roofing products, together with nonwoven mats used in manufacturing asphalt
roofing products and various industrial applications. The Industrial Products
group of companies, none of which individually accounted for 10% of consolidated
sales, operating income or assets in fiscal 1999, is engaged in the shielding of
plastic enclosures used in digital wireless cellular phones and other electronic
products from electromagnetic and radio frequency interference, the plating of
proprietary finishes for large diesel engine cylinder liners and pistons, and
engineering consulting services and licensing of patented technologies for the
cryogenic processing of natural gas and refinery gas and sulfur recovery
processes for the petroleum industry.


PRINCIPLES OF CONSOLIDATION

         The consolidated financial statements include the accounts of the
company and all subsidiaries after elimination of significant intercompany
balances and transactions. Service revenues and related expenses are not
disaggregated in the Consolidated Statement of Operations due to immateriality.
Appropriate references to number of shares and earnings per share information
has been adjusted as a result of a three-for-two stock split declared in June
1999.


USE OF ESTIMATES

         The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.


CONCENTRATION OF CREDIT RISK

         The majority of the company's sales are in the Roofing Products segment
and its primary customers are building materials distributors. For the past
several years, the building materials distribution industry has consolidated at
a rapid pace with many smaller independent distributors being acquired by
emerging larger national building products distributors. The company performs
ongoing credit evaluations and maintains reserves for potential credit losses.
One customer accounted for 18%, 16% and 14% of consolidated sales in fiscal
years 1999, 1998 and 1997, respectively.




                                       28
<PAGE>   30


REVENUE RECOGNITION

         Revenue is recognized at the time products are shipped to the customer
or at the time services are rendered.

INVENTORIES

         Inventories are stated at the lower of cost (including direct
materials, labor, and applicable overhead) or market, using the first-in,
first-out (FIFO) method. Inventories were comprised of:

<TABLE>
<CAPTION>

                                                 (In thousands)
                                                    June 30,
                                           ---------------------------
                                               1999           1998
                                           ------------   ------------
<S>                                        <C>            <C>
Raw materials                              $     10,213   $      7,827
Work-in-process                                     180            446
Finished goods                                   15,377         20,549
                                           ------------   ------------
                                           $     25,770   $     28,822
                                           ============   ============
</TABLE>

PROPERTY, PLANT AND EQUIPMENT

         Property, plant and equipment are stated at cost. Major renewals and
improvements are capitalized, while maintenance and repairs are expensed when
incurred. Depreciation is computed over the estimated useful lives of
depreciable assets using the straight-line method. Useful lives for property and
equipment are as follows:

         Buildings and improvements         10 - 40 years
         Machinery and equipment             5 - 20 years
         Computer equipment                  3 -  6 years
         Office furniture and equipment      5 - 12 years

         The cost and accumulated depreciation for property, plant and equipment
sold, retired, or otherwise disposed of are relieved from the accounts, and
resulting gains or losses are reflected in income. Interest is capitalized in
connection with the construction of major projects. The capitalized interest is
recorded as part of the asset to which it relates and is amortized over the
asset's estimated useful life. In 1999, 1998 and 1997, $595,000, $160,000 and
$1,784,000 of interest cost was capitalized, respectively.

OTHER ASSETS

         Included in other assets in the Consolidated Balance Sheet is the
excess of cost over the fair value of net assets (or goodwill) of an acquired
company. Goodwill totaling $892,000 is amortized on a straight-line basis over
20 years.



                                       29
<PAGE>   31



LONG-LIVED ASSETS

         The company assesses long-lived assets for impairment under Financial
Accounting Standards Board (FASB) Statement of Financial Accounting Standards
(SFAS) No. 121, "Accounting for the Impairment of Long-Lived Assets and for
Long-Lived Assets to Be Disposed Of." The carrying amount of long-lived assets,
including goodwill, is reviewed if facts and circumstances suggest that it may
be impaired. If this review indicates that long-lived assets will not be
recoverable, as determined based on the estimated undiscounted cash flows of the
long-lived assets over the remaining amortization period, the carrying amount of
the long-lived assets is reduced by the estimated shortfall of cash flows.


INCOME TAXES

         Deferred income taxes are provided to reflect temporary differences
between the financial reporting basis and the tax basis of the company's assets
and liabilities using presently enacted tax rates.

SUPPLEMENTAL CASH FLOWS

         The company considers all highly liquid investments with an original
maturity of three months or less to be cash equivalents. Supplemental cash flow
amounts were as follows:

<TABLE>
<CAPTION>

                                                     (In thousands)
                                                        June 30,
                                           ------------------------------------
                                              1999         1998         1997
                                           ----------   ----------   ----------
<S>                                        <C>          <C>          <C>
Interest paid                              $    2,270   $    2,803   $    2,951
Income taxes paid                          $    9,344   $    4,780   $    3,115
</TABLE>

ACCOUNTING CHANGE

         In April 1998, the Accounting Standards Executive Committee (AcSec) of
the American Institute of Certified Public Accountants issued Statement of
Position 98-5, "Reporting on the Costs of Start-Up Activities," requiring, among
other things, companies to expense on a current basis previously capitalized
start-up costs. The company adopted this Statement of Position in fiscal 1999,
which resulted in a $4,340,000 charge, net of tax, and is reported as a
cumulative effect of change in accounting principle on the Consolidated
Statement of Operations.

NEW ACCOUNTING STANDARDS

         In June 1997, the FASB issued SFAS No. 130, "Reporting Comprehensive
Income," which establishes standards of reporting of comprehensive income and
its components in the consolidated financial statements. The company adopted
SFAS No. 130 in fiscal 1999. The adoption of SFAS No. 130 had no effect on the
consolidated financial statements as the company has no items that are required
to be reported as components of comprehensive income.



                                       30
<PAGE>   32


         Also in June 1997, the FASB issued SFAS No. 131, "Disclosures about
Segments of an Enterprise and Related Information." SFAS No. 131 requires public
companies to disclose, among other things, certain interim and annual financial
information about the enterprise using a new management approach. The management
approach requires segment information to be reported based on how management
evaluates the operating performance of its business units or segments. The
company adopted SFAS No. 131 in fiscal 1999, but this adoption did not change
the company's reportable segments.

         In February 1998, the FASB issued SFAS No. 132, "Employers' Disclosures
about Pensions and Other Post Retirement Benefits." The company has no
significant pension or post retirement benefit plans affected by this statement.

         In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities." At June 30, 1999, the company had entered
into no significant derivative instruments or hedging activities, although the
company regularly reviews the potential benefits of interest rate swap
arrangements and may enter into derivative instruments from time to time in the
future.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

EARNINGS PER SHARE

         Basic earnings per share were computed by dividing net income by the
weighted average number of shares of common stock outstanding during the year,
adjusted for a three-for-two stock split declared in June 1999. The
reconciliation of basic earnings per share to diluted earnings per share is
shown in the following table:


<TABLE>
<CAPTION>
                                                                            (In thousands, except per share data)
                                                                             1999           1998           1997
                                                                         ------------   ------------   ------------

<S>                                                                      <C>            <C>            <C>
Net income                                                               $     20,943   $     18,324   $     12,276
                                                                         ============   ============   ============

Denominator for basic earnings per share-weighted average
shares outstanding                                                             19,546         19,867         19,762

Effect of dilutive securities:
  Employee stock options                                                          418            402            197
                                                                         ------------   ------------   ------------

Denominator for dilutive earnings per share - adjusted weighted
average shares and assumed issuance of shares purchased under
the incentive stock option plan using the treasury stock method                19,964         20,269         19,959
                                                                         ============   ============   ============

Basic earnings per share                                                 $       1.07   $        .92   $        .62
                                                                         ============   ============   ============

Diluted earnings per share                                               $       1.05   $        .90   $        .62
                                                                         ============   ============   ============
</TABLE>



                                       31
<PAGE>   33


LONG-TERM DEBT

         The company maintains an unsecured revolving credit facility (Facility)
of $100,000,000 of primary credit, including up to a maximum of $5,000,000 in
letters of credit, through December 15, 2002. At June 30, 1999, letters of
credit totaling $2,140,000 were outstanding.

         Borrowings under the Facility bear interest at (1) the higher of the
federal funds rate plus .5% or the lender's prime rate, or (2) at the company's
option, LIBOR, in each case plus specified basis points based on the ratio of
the company's total indebtedness to total capital. The Facility also provides
for a commitment fee on the average unused portion of the line and is also based
on the ratio of the company's total indebtedness to total capital. Based on
financial ratios at June 30, 1999, the LIBOR borrowing rate was LIBOR plus .5%
and the commitment fee was .175% of the average unused portion of the line. The
average interest rate paid on indebtedness in fiscal 1999 was 6.1%.

         The loan agreement, among other things, limits the sale or pledging of
assets of subsidiaries involved in manufacturing asphalt roofing products, and
requires maintenance of specified current ratios, capitalization ratios and cash
flow levels. Dividend payments and stock repurchases are limited to certain
specified levels. At June 30, 1999, total cumulative dividend payments and stock
repurchased since July 1, 1993 were subject to a $40,095,000 limitation. Actual
expenditures for these items as of June 30, 1999 have been $23,214,000.

SHAREHOLDERS' EQUITY

         Authorized common stock, par value $1.00, is 100,000,000 shares, of
which 19,988,354 shares were issued at June 30, 1999. The Board of Directors is
authorized to issue up to 1,000,000 shares of preferred stock, without par
value, in one or more series and to determine the rights, preferences, and
restrictions applicable to each series. No preferred stock has been issued.

         In June 1999, the Board of Directors declared a three-for-two stock
split payable in the form of a stock dividend which was distributed on August
11, 1999 to shareholders of record on July 15, 1999. An amount equal to the par
value of the common shares issued in connection with the split was transferred
from paid-in capital to the common stock account. Appropriate references to
number of shares and to per share information in the Consolidated Financial
Statements have been adjusted to reflect the stock split on a retroactive basis.

SHAREHOLDER RIGHTS PLAN

         On May 26, 1998, the company's Board of Directors adopted a new
Shareholder Rights Plan which took effect when the existing rights plan expired
on July 8, 1998. Under the new plan, rights were constructively distributed as a
dividend at the rate of one right for each share of common stock of the company
held by the shareholders of record as of the close of business on July 8, 1998.
Until the occurrence of certain events, the rights are represented by and traded
in tandem with common stock. Each right will separate and entitle shareholders
to buy stock upon an occurrence of certain takeover or stock accumulation
events. Should any person or group (Related Person) acquire beneficial ownership
of 15% or more of the company's common stock other than certain bona fide
institutional investors to whom a 20% threshold applies, all rights not held by
the Related Person become rights to purchase one one-hundredth of a share of
preferred stock for $110 or $110 of Elcor common stock at a 50% discount. If
after such an





                                       32
<PAGE>   34


event the company merges, consolidates or engages in a similar transaction in
which it does not survive, each holder has a "flip over" right to buy discounted
stock in a surviving entity.

         Under certain circumstances, the rights are redeemable at a price of
$0.01 per right. Further, upon defined stock accumulation events, the Board of
Directors has the option to exchange one share of common stock per right. The
rights will expire by their terms on July 8, 2008.

EMPLOYEE BENEFIT PLANS

         The company's Incentive Stock Option Plan provides for the granting of
incentive and non-qualified stock options to directors, officers and key
employees of the company for purchase of the company's common stock.

Information relating to options is as follows:

<TABLE>
<CAPTION>

                                                                                                                     Weighted
                                                              Number                Option Price                  Average Option
                                                             of Shares             Range per Share                Price per Share
                                                           -------------        --------------------             -----------------

<S>                                                        <C>                 <C>                           <C>
Outstanding at June 30, 1996                                     766,755        $ 3.11   -    $10.73                  $ 6.93
  Granted                                                        228,938        $ 7.55   -    $ 8.45                  $ 8.30
  Cancelled                                                       (5,967)       $ 3.89   -    $10.73                  $ 8.24
  Exercised                                                     (110,460)       $ 3.11   -    $ 8.83                  $ 3.81
                                                           -------------
Outstanding at June 30, 1997                                     879,266        $ 3.11   -    $10.73                  $ 7.67
  Granted                                                        224,767        $13.33   -    $18.42                  $14.91
  Cancelled                                                       (3,957)       $ 5.39   -    $10.73                  $ 6.51
  Exercised                                                     (224,784)       $ 3.11   -    $13.33                  $ 6.92
                                                           -------------
Outstanding at June 30, 1998                                     875,292        $ 3.11   -    $18.42                  $ 9.72
  Granted                                                        194,295        $14.67   -    $23.17                  $17.52
  Cancelled                                                      (11,910)       $ 3.11   -    $18.42                  $12.07
  Exercised                                                     (125,602)       $ 3.11   -    $14.67                  $ 5.74
                                                           -------------
Outstanding at June 30, 1999                                     932,075        $ 3.89   -    $23.17                  $11.85
                                                           =============
</TABLE>


The following table summarizes information about options outstanding at June 30,
1999:


<TABLE>
<CAPTION>

                                                Options Outstanding                               Options Exercisable
                             ----------------------------------------------------------     ----------------------------------
                                                             Weighted-Average
                                  Number         --------------------------------------        Number            Weighted
Range of Exercise             Outstanding at         Remaining               Exercise       Exercisable at        Average
    Prices                       6/30/99         Contractual Life             Price             6/30/99        Exercise Price
-----------------            ---------------     ------------------       -------------     ---------------    ---------------



<S>                          <C>                 <C>                      <C>                <C>                <C>
$ 3.89 - $ 9.99                 453,334              5.09 yrs.               $ 8.14               244,937           $ 7.48
$10.00 - $14.99                 252,856              7.44 yrs.               $13.06                55,633           $10.72
$15.00 - $23.17                 225,885              8.84 yrs.               $17.95                54,000           $17.81
</TABLE>



                                       33
<PAGE>   35

         At June 30, 1999, 1998 and 1997, 354,570, 314,720 and 327,347 shares
were exercisable, respectively. A total of 1,907,003, 375,096 and 595,907 shares
were reserved for future grants at June 30, 1999, 1998 and 1997, respectively.

         Beginning in fiscal 1997, the company adopted the disclosure-only
provisions of SFAS No. 123, "Accounting for Stock-Based Compensation."
Accordingly, no compensation cost has been recognized with respect to the
company's stock option plan. Pro forma information regarding net income and
income per share set forth below has been determined as if the company had
accounted for its stock options under the fair value methodology prescribed by
SFAS No. 123. The fair value of each option grant is estimated on the date of
grant using the Black-Scholes option-pricing model with the following
weighted-average assumptions for fiscal 1999, 1998 and 1997; dividend yields of
1.1%, 1.1% and 1.5%; risk-free interest rates of 4.6%, 6.2% and 6.5%; expected
market price volatility of .416, .413 and .429; and expected lives of options of
8.9, 8.5 and 6.9 years. Based on this model, the weighted average fair value of
stock options granted in fiscal 1999, 1998 and 1997 was $8.72, $7.75 and $3.85,
respectively.

<TABLE>
<CAPTION>
                                                          (In thousands,
                                                       except per share data)
                                             ------------------------------------------
                                                 1999           1998            1997
                                             ------------   ------------   ------------

<S>                                          <C>            <C>            <C>
Net income, as reported                      $     20,943   $     18,324   $     12,276
Net income, pro forma                        $     20,292   $     17,651   $     11,945
Income per share - basic, as reported        $       1.07   $        .92   $        .62
Income per share - basic, pro forma          $       1.04   $        .89   $        .61
Income per share - diluted, as reported      $       1.05   $        .90   $        .62
Income per share - diluted, pro forma        $       1.02   $        .87   $        .60
</TABLE>

         The pro forma amounts presented above may not be representative of the
effects on reported net income for future years.

         The company's Employee Stock Ownership Plan (ESOP) became effective
January 1, 1981. Under the plan, the company contributes a percentage of each
participant's annual compensation into a trust, either as treasury stock
contributions or cash, which is then used to purchase Elcor common stock.
Employees vest 20% after three years of employment and 20% per year thereafter,
with the stock distributed at retirement, death, disability, or as authorized by
the Plan Administrative Committee. Effective January 1, 1990, the company
established an Employee Savings Plan under Internal Revenue Code section 401(k).
Under the 401(k) Plan, the company contributes a percentage of each
participant's annual compensation into a Plan to be invested among various
defined alternatives at the participants' direction. Vesting of company
contributions is in accordance with the same schedule as that of the ESOP. All
full-time employees, except those covered by plans established through
collective bargaining, are eligible for participation in the above plans after
meeting minimum service requirements.

         The Board of Directors authorized total contributions of 5.0% including
forfeitures in fiscal 1999, 5.0% in fiscal 1998 and 4.6% in fiscal 1997, of each
participant's annual compensation, as defined, split equally between the ESOP
and 401(k) Plans. In addition, on January 1, 1998, the company began
contributing an additional $.50 for every $1.00 of employee contributions into
the 401(k) Plan limited to a maximum matching of 2% of an employee's
compensation. Total contributions charged to expense for these plans were
$2,123,000, $1,722,000 and $1,245,000, in 1999, 1998 and 1997, respectively.


                                       34
<PAGE>   36
         The company has a Stock/Loan Plan which allows certain key employees to
borrow an amount, based on a percentage of their salaries and the performance of
their operating units, for the purpose of purchasing the company's common stock.
Under the Stock/Loan Plan, the loans, which are unsecured, and any accrued
interest are forgiven and amortized as compensation over five years of
continuing service with the company. If employment is terminated for any reason
except death, disability or retirement, the balance of the loan becomes due and
payable. Loans outstanding at June 30, 1999 and 1998 totaling $1,436,700 and
$1,074,000, respectively, are included in other assets.

COMMITMENTS AND CONTINGENCIES

         The company and its subsidiaries lease certain office space,
facilities, and equipment under operating leases, expiring on various dates
through 2004. Total rental expense was $1,618,000 in 1999, $1,505,000 in 1998
and $1,295,000 in 1997. At June 30, 1999, future minimum rental commitments
under noncancellable operating leases, payable over the remaining lives of the
leases, are:

<TABLE>
<CAPTION>

                                          (In thousands)
                                          Minimum Rental
            Fiscal Year                    Commitments
            -----------                   --------------

<S>                                       <C>
                2000                        $   1,489
                2001                            1,148
                2002                              948
                2003                              907
                2004                              645
             Thereafter                            --
                                            ---------
               Total                        $   5,137
                                            =========
</TABLE>

         The company's subsidiaries provide certain warranties for their
products which are generally limited to being free from defect in materials or
workmanship affecting performance or meeting specified manufacturing and
material specifications. During 1999, 1998 and 1997, the company recorded to
expense $2,334,000, $1,681,000 and $1,566,000, respectively, in warranty claim
settlements and reserves.

         On February 8, 1994, a wholly owned subsidiary, Elk Corporation of
Dallas (Elk) was granted a design patent covering the ornamental aspects of its
High Definition(R) and Raised Profile(TM) shingles. On December 6, 1994, Elk was
granted a utility patent on the functional aspects of the High Definition(R) and
Raised Profile(TM) shingles. Elk has sued GAF Building Materials Corporation and
related GAF entities (collectively GAF) in federal court for infringement of
these patents and trade dress. In the design patent case, Elk seeks to recover
as damages the total profit that GAF has made from the infringing shingles. In
the utility patent case, Elk seeks to recover as damages a reasonable royalty on
GAF's sales of infringing shingles and certain lost profits.



                                       35
<PAGE>   37

         GAF seeks a declaratory judgment that the Elk patents are not infringed
and are either invalid or unenforceable. GAF has also asserted claims for unfair
competition, Lanham Act violations based on alleged false advertising, and
common law fraud, generally praying for damages of not less than $25 million
including actual and punitive damages, plus interest, costs, and reasonable
attorney fees. Elk disputes GAF's claims, and management intends vigorously to
defend them and to enforce its intellectual property rights. In April 1998, the
District Court for the Northern District of Texas entered a partial final
judgment in the design patent case based on an inequitable conduct ruling and
certified the case for appeal. On February 11, 1999, the United States Court of
Appeals for the Federal Circuit (Court of Appeals) issued a decision upholding
the district court's partial final judgment against Elk in its design patent
case. The decision held that the district court committed no reversible error in
finding Elk's design patent unenforceable. On April 16, 1999, the Court of
Appeals denied Elk's petition for a rehearing of the case.

         On July 15, 1999, Elk appealed by a petition for certiorari with the
United States Supreme Court. GAF filed its opposition in August 1999. Elk
expects a Supreme Court decision whether to hear its appeal before the end of
fiscal 2000.

         While management can give no assurances regarding the ultimate outcome
of the litigation, even if the outcome were to be adverse to Elk, it is not
expected to have a material effect on the Registrant's financial position or
liquidity.

         The company and its subsidiaries are involved in other legal actions
and claims, including claims arising in the ordinary course of business. Based
on advice from legal counsel, management believes such litigation and claims
will be resolved without material adverse effect on the consolidated financial
statements.

         The company is self-insured for its products and completed operations
liability exposure because the cost of insurance for such risks is believed to
be excessive for the coverage to be provided. Reserves for estimated potential
losses of this type have been established.

         The company's operations are subject to extensive federal, state and
local laws and regulations relating to environmental matters. Although the
company does not believe it will be required to expend amounts which will have a
material adverse effect on the company's consolidated financial position or
results of operations by reason of environmental laws and regulations, such laws
and regulations are frequently changed and could result in significantly
increased cost of compliance. Further, certain of the company's industrial
products operations utilize hazardous materials in their production processes.
As a result, the company incurs costs for remediation activities at its
facilities and off-site from time to time. The company establishes and maintains
reserves for such remediation activities.

INVOLUNTARY CONVERSION

         On September 15, 1998, the company experienced an explosion at its
fiberglass roofing mat plant in Ennis, Texas. The explosion significantly
damaged a drying oven and caused less extensive damage to the remainder of the
mat manufacturing line. At the time of the explosion, the damaged mat line
supplied all of the company's internal fiberglass roofing mat needs. In
addition, roofing mat from the damaged line was being sold to other asphalt
roofing products manufacturers. There was no damage to a separate mat line that
runs in parallel to the damaged line, nor was there any damage to the company's
Ennis, Texas shingle manufacturing plant.





                                       36
<PAGE>   38


There were no injuries from the explosion. The damaged line was restored to
partial operation in December 1998. By March 1999, the damaged section had been
replaced. In June 1999, the line was operating at line speeds equivalent to line
speeds at the time of the explosion.

         The company carries both property damage and business interruption
insurance. The $100,000 deductible portion of the loss was recorded during the
quarter ended September 30, 1998. The company has submitted claims totaling
$17,492,000. As of June 30, 1999, the company had received insurance advances of
$9,687,000. Claimed but unpaid amounts are under review by the insurance
company. Operating income from the lost sales portion of the business
interruption claim have been accounted for as a contingent receivable, and
accordingly have not been recorded to income as of June 30, 1999, pending
settlement with the insurance company. Assets with net book value of $3,990,000
were destroyed in the explosion and were insured for replacement value. When the
insurance claim is settled, any difference between insurance proceeds received
and net book value of destroyed assets, if any, will be recorded as a
nonrecurring gain.

ACQUISITION AND CONSOLIDATION

         On January 11, 1999, a newly formed wholly owned subsidiary of the
company purchased all of the outstanding shares of YDK America, Inc., a leading
supplier to the computer industry of electronic plastic enclosures and
components having electroless conductive coatings. The total purchase price was
$5,588,000, net of cash acquired, which was financed through borrowings under
Elcor's revolving credit agreement. The purchase price exceeded the fair value
of net tangible assets acquired by $892,000, which was recorded as goodwill. The
acquisition was accounted for using the purchase method of accounting, and the
operating results have been included in the company's consolidated financial
statements since the date of acquisition. The acquisition did not have a
material impact on operating results in fiscal 1999.

         In the fourth quarter of fiscal 1999, management approved a
consolidation plan for Chromium Corporation's reciprocating engine components
business. All operations for this business activity at Chromium's Lufkin, Texas
facility will be transferred to its Cleveland, Ohio plant. Costs to relocate
equipment and other consolidation items with an estimated cost of $1,145,000 are
expected to be incurred and recorded to expense in the first half of fiscal
2000. In the fourth quarter of fiscal 1999 the company recorded a pretax charge
of $375,000 in severance benefits for 64 employees who will not be transferred.

         Subsequent to the completion of this business consolidation, the
Lufkin, Texas facility will be used exclusively for conductive coatings
operations.


                                       37
<PAGE>   39


ACCRUED LIABILITIES

Accrued liabilities consist of the following:

<TABLE>
<CAPTION>

                                                  (In thousands)
                                                     June 30,
                                           ---------------------------
                                               1999           1998
                                           ------------   ------------

<S>                                        <C>            <C>
Product warranty reserves                  $      1,976   $      1,699
Self-insurance reserves                           1,208            919
Compensation and employee benefits                4,666          4,303
All other                                         7,967          5,707
                                           ------------   ------------
                                           $     15,817   $     12,628
                                           ============   ============
</TABLE>

INCOME TAXES

         The company's effective tax rate was 36.0% in 1999, 35.6% in 1998 and
37.0% in 1997. The difference between the federal statutory tax rate and the
effective tax rate is reconciled as follows:

<TABLE>
<CAPTION>

                                                          1999         1998          1997
                                                       ---------    ---------     ---------

<S>                                                    <C>          <C>           <C>
Federal statutory tax rate                                  35.0%        35.0%         35.0%
Change in tax rate resulting from:
  State income taxes, net of federal tax effect               .7%          .9%          1.6%
  Miscellaneous items                                         .3%         (.3%)          .4%
                                                       ---------    ---------     ---------
                                                            36.0%        35.6%         37.0%
                                                       =========    =========     =========
</TABLE>


Components of the income tax provisions consist of the following:

<TABLE>
<CAPTION>

                                                                  (In thousands)
                                                            1999         1998          1997
                                                       ---------    ---------     ---------

<S>                                                    <C>          <C>           <C>
Federal:
  Current                                              $   9,169    $   6,722     $   1,709
  Deferred, net                                            4,625        3,010         5,001
State                                                        453          402           499
                                                       ---------    ---------     ---------
                                                       $  14,247    $  10,134     $   7,209
                                                       =========    =========     =========
</TABLE>



                                       38
<PAGE>   40



The significant components of the company's deferred tax assets and liabilities
are summarized below:

<TABLE>
<CAPTION>


                                                                      (In thousands)
                                                            1999            1998            1997
                                                       ------------    ------------    ------------
<S>                                                    <C>             <C>             <C>
Deferred tax assets:
    Accrued liabilities, difference in
      expense recognition                              $      2,304    $      1,786    $      2,269
    Receivables, bad debt reserve                               338             203             191
    Inventories, difference in capitalization                    44             239             475
                                                       ------------    ------------    ------------
                                                              2,686           2,228           2,935
                                                       ------------    ------------    ------------

Deferred tax liabilities:
    Fixed assets, primarily depreciation method
      differences and deferred preoperating costs           (18,047)        (15,881)        (13,578)
      Other current assets, insurance claim                    (575)             --              --
                                                       ------------    ------------    ------------
                                                            (18,622)        (15,881)        (13,578)
                                                       ------------    ------------    ------------

Net deferred tax liability                             $    (15,936)   $    (13,653)   $    (10,643)
                                                       ============    ============    ============
</TABLE>



                                       39
<PAGE>   41


FINANCIAL  INFORMATION BY COMPANY SEGMENTS

<TABLE>
<CAPTION>

                                                                       (In thousands)
                                                            1999            1998            1997
                                                       ------------    ------------    ------------

<S>                                                    <C>             <C>             <C>
SALES
Roofing products                                       $    278,918    $    229,475    $    207,017
Industrial products                                          38,816          38,586          23,542
Corporate and eliminations                                      140             117             197
                                                       ------------    ------------    ------------
                                                       $    317,874    $    268,178    $    230,756
                                                       ============    ============    ============

OPERATING PROFIT
Roofing products                                       $     45,061    $     24,885    $     21,052
Industrial products(1)                                        3,566          10,780           3,498
Corporate and other                                          (7,122)         (5,076)         (4,144)
                                                       ------------    ------------    ------------
                                                             41,505          30,589          20,406

Interest expense, net                                        (1,975)         (2,131)           (921)
                                                       ------------    ------------    ------------
Income before income taxes                             $     39,530    $     28,458    $     19,485
                                                       ============    ============    ============

IDENTIFIABLE ASSETS
Roofing products                                       $    209,742    $    187,770    $    184,138
Industrial products                                          28,349          14,931           9,248
Corporate                                                    14,091          14,343          13,063
                                                       ------------    ------------    ------------
                                                       $    252,182    $    217,044    $    206,449
                                                       ============    ============    ============

DEPRECIATION AND AMORTIZATION
Roofing products                                       $      7,899    $     10,025    $      7,704
Industrial products                                           1,209             833             727
Corporate                                                       177             198             233
                                                       ------------    ------------    ------------
                                                       $      9,285    $     11,056    $      8,664
                                                       ============    ============    ============

CAPITAL EXPENDITURES
Roofing products                                       $     19,229    $      6,745    $     14,222
Industrial products                                           5,300           4,245           1,400
Corporate                                                     5,519           3,298             274
                                                       ------------    ------------    ------------
                                                       $     30,048    $     14,288    $     15,896
                                                       ============    ============    ============
</TABLE>

(1)      In fiscal 1998, operating profit from the company's technology
         licensing and consulting services business exceeded 10% of consolidated
         operating profit. This business has not historically met the 10%
         reporting test nor is it typically expected to in the future. No
         separate segment is reflected in fiscal 1998 for this business unit.


                                       40
<PAGE>   42

                          INDEPENDENT AUDITORS' REPORT
                            ON SUPPLEMENTAL SCHEDULE



To the Shareholders and Board of Directors of Elcor Corporation:


         We have audited in accordance with generally accepted auditing
standards, the accompanying consolidated financial statements of Elcor
Corporation and have issued our report thereon dated August 16, 1999. Our audit
was made for the purpose of forming an opinion on those statements taken as a
whole. The Supplemental Schedule II is the responsibility of the Company's
management and is presented for purposes of complying with the Securities and
Exchange Commission's rules and is not part of the basic financial statements.
This schedule has been subjected to the auditing procedures applied in the audit
of the basic financial statements and, in our opinion, fairly states in all
material respects the financial data required to be set forth herein in relation
to the basic financial statements taken as a whole.





                                                  /s/ Arthur Andersen LLP
                                                  -----------------------------
                                                      Arthur Andersen LLP



Dallas, Texas
   August 16, 1999





                                       41
<PAGE>   43

                                                                     SCHEDULE II
                                                                  (In thousands)

                       ELCOR CORPORATION AND SUBSIDIARIES
          SCHEDULE II - CONSOLIDATED VALUATION AND QUALIFYING ACCOUNTS
                FOR THE YEARS ENDED JUNE 30, 1999, 1998, AND 1997


<TABLE>
<CAPTION>

               Column A                       Column B                 Column C                     Column D         Column E
               --------                       --------       ---------------------------------  ----------------    -----------

                                                                         Additions                 Deductions
                                                             ---------------------------------  ----------------
                                             Balance at        Charged to                       For Purposes For      Balance at
                                             Beginning         Costs and                         Which Reserves          End
             Description                     of Period          Expenses           Other          Were Created        of Period
             -----------                   ---------------   ---------------   ---------------  ----------------    ---------------

YEAR ENDED JUNE 30, 1999

CONSOLIDATED:

<S>                                        <C>               <C>               <C>               <C>                <C>
Allowance for doubtful accounts            $           580   $           525   $            14   $          (152)   $           967
                                           ===============   ===============   ===============   ===============    ===============
Allowance for inventory obsolescence       $           125   $           262   $            --   $           (90)   $           297
                                           ===============   ===============   ===============   ===============    ===============

YEAR ENDED JUNE 30, 1998

CONSOLIDATED:

Allowance for doubtful accounts            $           545   $           210   $            --   $          (175)   $           580
                                           ===============   ===============   ===============   ===============    ===============
Allowance for inventory obsolescence       $           201   $            25   $            --   $          (101)   $           125
                                           ===============   ===============   ===============   ===============    ===============
YEAR ENDED JUNE 30, 1997

CONSOLIDATED:

Allowance for doubtful accounts            $           477   $            78   $            --   $           (10)   $           545
                                           ===============   ===============   ===============   ===============    ===============
Allowance for inventory obsolescence       $           673   $            47   $            --   $          (519)   $           201
                                           ===============   ===============   ===============   ===============    ===============
</TABLE>


                                       42
<PAGE>   44


Item 9. Disagreements on Accounting and Financial Disclosure

         The Registrant has retained its independent public accountants for over
30 years. There have been no disagreements with the independent public
accountants on accounting or financial disclosure matters.


                                    PART III

Item 10. Directors and Executive Officers of the Registrant

         Information concerning the Directors of the Registrant required by this
item is incorporated herein by reference to the material under the caption
"Election of Directors" on pages 4, 5 and 6 of the Registrant's Proxy Statement
dated September 17, 1999. Information concerning the Executive Officers of the
Registrant is contained in Item 1 of this report under the caption "Executive
Officers of the Registrant" on pages 10 and 11 of this Annual Report on Form
10-K.

Item 11.  Executive Compensation

         The information required by this item is incorporated herein by
reference to the information under the caption "Executive Compensation" on pages
7 through 10 of the Registrant's Proxy Statement dated September 17, 1999.

Item 12.  Security Ownership of Certain Beneficial Owners and Management

         The information required by this item is incorporated herein by
reference to the information under the caption "Stock Ownership" on pages 2 and
3 of the Registrant's Proxy Statement dated September 17, 1999. The referenced
information was provided as of September 7, 1999. Registrant is aware of no
material change since such date in the beneficial ownership of any officer,
director or beneficial owner of five percent of any class of its voting stock.

Item 13.  Certain Relationships and Related Transactions

         There are no reportable transactions, business relationships or
indebtedness between the Registrant and any covered party.


                                       43
<PAGE>   45


                                     PART IV

Item 14.  Exhibits, Financial Statement Schedules and Reports of Form 8-K

(a)    Financial Statements

         The following financial statements of Elcor Corporation are set forth
in Item 8 of this Annual Report on Form 10-K:


Financial Statements:

Independent Auditors' Report
Consolidated Balance Sheet at June 30, 1999, and 1998
Consolidated Statement of Operations for the years ended
 June 30, 1999, 1998 and 1997
Consolidated Statement of Cash Flows for the years ended
 June 30, 1999, 1998, and 1997
Consolidated Statement of Shareholders' Equity for the years
 ended June 30, 1999, 1998, and 1997
Notes to Consolidated Financial Statements


Financial Statement Schedule:

Independent Auditors' Report
Schedule II - Consolidated Valuation and Qualifying Accounts and Reserves

All other schedules are omitted because they are not required, are not
applicable, or the information is included in the financial statements or
notes thereto.

(b)    Reports on Form 8-K

       The Registrant filed Forms 8-K on April 16, 1999 and June 28, 1999
relating to press releases containing "forward-looking statements" about its
prospects for the future.

(c)    Exhibits

            **3.1    The Restated Certificate of Incorporation of the
                     Registrant, filed as Exhibit 3.1 to the Registrant's Annual
                     Report on Form 10-K for the year ended June 30, 1994 (File
                     No. 1-5341).

            *3.11    Certificate of Amendment to Certificate of Incorporation
                     dated December 2, 1998.



                                       44
<PAGE>   46


            **3.2    Amended and Restated Bylaws of the Registrant, filed as
                     Exhibit 3 to the Registrant's Annual Report on Form 10-K
                     for the year ended June 30, 1981 and as Exhibit 3.2 to the
                     Registrant's Quarterly Report on Form 10-Q for the quarter
                     ended December 31, 1988 originally filed with the
                     Securities and Exchange Commission on February 11, 1989
                     (File No. 1-5341).

            **4.1    Form of Rights Agreement dated as of July 7, 1998, between
                     the company and ChaseMellon Shareholder Services, L.L.C.,
                     as Rights Agent, which includes as Exhibits A and B thereto
                     the Forms of Certificate of Designation, Preferences and
                     Rights of Series A Participating Preferred Stock, Rights
                     Certificate, filed as Exhibit 4.1 to the company's current
                     Report on Form 8-K dated May 26, 1998 (File No. 1-5341).

            **4.6    Loan Agreement dated September 19, 1993 among Elcor
                     Corporation, Certain Lenders, NationsBank of Texas, N.A.,
                     as Issuer, and NationsBank of Texas, N.A., as
                     Administrative Lender, filed as Exhibit 4.6 in the
                     Registrant's Quarterly Report on Form 10-Q for the quarter
                     ended September 30, 1993 (File No. 1-5341).

            **4.7    First Amendment dated October 31, 1994 to Loan Agreement
                     dated September 29, 1993 among Elcor Corporation,
                     NationsBank of Texas, N.A., as Issuer, and NationsBank of
                     Texas, N.A. as Administrative Lender, filed as Exhibit 4.7
                     in the Registrant's Quarterly Report on Form 10-Q for the
                     quarter ended September 30, 1994 (File No. 1-5341).

            **4.8    Second Amendment dated December 15, 1995 to Loan Agreement
                     dated September 29, 1993 among Elcor Corporation,
                     NationsBank of Texas, N.A., As Issuer, Administrative
                     Lender, and Lender; and Bank of America - Texas, N.A. and
                     Comerica Bank - Texas as Lenders, filed as Exhibit 4.8 in
                     the Registrant's Quarterly Report on Form 10-Q for the
                     quarter ended December 31, 1995 (File No. 1-5341).

            **4.9    Third Amendment dated October 31, 1996 to Loan Agreement
                     dated September 29, 1993 among Elcor Corporation,
                     NationsBank of Texas, N.A., As Issuer, Administrative
                     Lender, and Lender; and Bank of America - Texas, N.A. and
                     Comerica Bank - Texas as Lenders, filed as Exhibit 4.9 in
                     the Registrant's Quarterly Report on Form 10-Q for the
                     quarter ended September 30, 1996 (File No. 1-5341).

            **4.10   Fourth Amendment dated December 15, 1997 to Loan Agreement
                     dated September 29, 1993 among Elcor Corporation,
                     NationsBank of Texas, N.A., as Issuer, Administrative
                     Lender, and Lender; and Bank of America - Texas, N.A.,
                     Comerica Bank - Texas, and the Bank of Tokyo - Mitsubishi,
                     Ltd. as Lenders, filed as Exhibit 4.10 in the Registrant's
                     Quarterly Report on Form 10-Q for the quarter ended
                     December 31, 1997 (File No. 1-5341).



                                       45
<PAGE>   47

            **10.1   Form of Executive Agreement filed as Exhibit 10.1 in the
                     Registrant's Annual Report on Form 10-K for the year ended
                     June 30, 1998 (File No. 1-5341).

            **10.2   Amended and Restated Elcor Corporation Employee Stock/Loan
                     Plan filed as Exhibit 10.2 in the Registrant's Annual
                     Report on Form 10-K for the year ended June 30, 1998 (File
                     No. 1-5341).

            **10.3   1998 Amended and Restated Elcor Corporation Incentive Stock
                     Option Plan filed as Appendix B in the Registrant's Proxy
                     Statement dated September 18, 1998 (File No. 1-5341).

            *21      Subsidiaries of the Registrant.

            *23      Consent of Independent Public Accountants.

            *27      Financial Data Schedule (EDGAR submission only).

              *      Filed herewith.

             **      Incorporated by reference.


                                       46
<PAGE>   48


                                   SIGNATURES



         Pursuant to the requirements of Section 13 or 15 (d) 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.







                                     ELCOR CORPORATION


Date: September 27, 1999             By /s/ Richard J. Rosebery
                                        ---------------------------------------
                                            Richard J. Rosebery
                                            Vice Chairman,
                                            Chief Financial and Administrative
                                            Officer, and Treasurer


                                     By /s/ Leonard R. Harral
                                        ---------------------------------------
                                            Leonard R. Harral
                                            Vice President and Chief
                                            Accounting Officer



                                       47
<PAGE>   49


                                   SIGNATURES



     Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below in multiple counterparts by the following persons
on behalf of the Registrant and in the capacities and on the date indicated.



<TABLE>
<CAPTION>
        Signature                              Title                         Date
        ---------                              -----                         ----

<S>                                    <C>                             <C>
/s/ Harold K. Work                     Chairman of the Board,          September 27, 1999
--------------------------             President, Chief
    Harold K. Work                     Executive Officer

/s/ Richard J. Rosebery                Vice Chairman, Chief            September 27, 1999
--------------------------             Financial and Administrative
    Richard J. Rosebery                Officer, and Treasurer

/s/ Leonard R. Harral                  Vice President and              September 27, 1999
--------------------------             Chief Accounting
    Leonard R. Harral                  Officer

/s/ James E. Hall                      Director                        September 27, 1999
--------------------------
    James E. Hall

/s/ Thomas D. Karol                    Director                        September 27, 1999
--------------------------
    Thomas D. Karol

/s/ Dale V. Kesler                     Director                        September 27, 1999
--------------------------
    Dale V. Kesler

/s/ W.F. Ortloff                       Director                        September 27, 1999
--------------------------
    W.F. Ortloff

/s/ David W. Quinn                     Director                        September 27, 1999
--------------------------
    David W. Quinn
</TABLE>



<PAGE>   50

                               INDEX TO EXHIBITS

<TABLE>
<CAPTION>
            Exhibit
            Number                Description
            ------                -----------

<S>                  <C>
            **3.1    The Restated Certificate of Incorporation of the
                     Registrant, filed as Exhibit 3.1 to the Registrant's Annual
                     Report on Form 10-K for the year ended June 30, 1994 (File
                     No. 1-5341).

            *3.11    Certificate of Amendment to Certificate of Incorporation
                     dated December 2, 1998.

            **3.2    Amended and Restated Bylaws of the Registrant, filed as
                     Exhibit 3 to the Registrant's Annual Report on Form 10-K
                     for the year ended June 30, 1981 and as Exhibit 3.2 to the
                     Registrant's Quarterly Report on Form 10-Q for the quarter
                     ended December 31, 1988 originally filed with the
                     Securities and Exchange Commission on February 11, 1989
                     (File No. 1-5341).

            **4.1    Form of Rights Agreement dated as of July 7, 1998, between
                     the company and ChaseMellon Shareholder Services, L.L.C.,
                     as Rights Agent, which includes as Exhibits A and B thereto
                     the Forms of Certificate of Designation, Preferences and
                     Rights of Series A Participating Preferred Stock, Rights
                     Certificate, filed as Exhibit 4.1 to the company's current
                     Report on Form 8-K dated May 26, 1998 (File No. 1-5341).

            **4.6    Loan Agreement dated September 19, 1993 among Elcor
                     Corporation, Certain Lenders, NationsBank of Texas, N.A.,
                     as Issuer, and NationsBank of Texas, N.A., as
                     Administrative Lender, filed as Exhibit 4.6 in the
                     Registrant's Quarterly Report on Form 10-Q for the quarter
                     ended September 30, 1993 (File No. 1-5341).

            **4.7    First Amendment dated October 31, 1994 to Loan Agreement
                     dated September 29, 1993 among Elcor Corporation,
                     NationsBank of Texas, N.A., as Issuer, and NationsBank of
                     Texas, N.A. as Administrative Lender, filed as Exhibit 4.7
                     in the Registrant's Quarterly Report on Form 10-Q for the
                     quarter ended September 30, 1994 (File No. 1-5341).

            **4.8    Second Amendment dated December 15, 1995 to Loan Agreement
                     dated September 29, 1993 among Elcor Corporation,
                     NationsBank of Texas, N.A., As Issuer, Administrative
                     Lender, and Lender; and Bank of America - Texas, N.A. and
                     Comerica Bank - Texas as Lenders, filed as Exhibit 4.8 in
                     the Registrant's Quarterly Report on Form 10-Q for the
                     quarter ended December 31, 1995 (File No. 1-5341).

            **4.9    Third Amendment dated October 31, 1996 to Loan Agreement
                     dated September 29, 1993 among Elcor Corporation,
                     NationsBank of Texas, N.A., As Issuer, Administrative
                     Lender, and Lender; and Bank of America - Texas, N.A. and
                     Comerica Bank - Texas as Lenders, filed as Exhibit 4.9 in
                     the Registrant's Quarterly Report on Form 10-Q for the
                     quarter ended September 30, 1996 (File No. 1-5341).

            **4.10   Fourth Amendment dated December 15, 1997 to Loan Agreement
                     dated September 29, 1993 among Elcor Corporation,
                     NationsBank of Texas, N.A., as Issuer, Administrative
                     Lender, and Lender; and Bank of America - Texas, N.A.,
                     Comerica Bank - Texas, and the Bank of Tokyo - Mitsubishi,
                     Ltd. as Lenders, filed as Exhibit 4.10 in the Registrant's
                     Quarterly Report on Form 10-Q for the quarter ended
                     December 31, 1997 (File No. 1-5341).

            **10.1   Form of Executive Agreement filed as Exhibit 10.1 in the
                     Registrant's Annual Report on Form 10-K for the year ended
                     June 30, 1998 (File No. 1-5341).

            **10.2   Amended and Restated Elcor Corporation Employee Stock/Loan
                     Plan filed as Exhibit 10.2 in the Registrant's Annual
                     Report on Form 10-K for the year ended June 30, 1998 (File
                     No. 1-5341).

            **10.3   1998 Amended and Restated Elcor Corporation Incentive Stock
                     Option Plan filed as Appendix B in the Registrant's Proxy
                     Statement dated September 18, 1998 (File No. 1-5341).

            *21      Subsidiaries of the Registrant.

            *23      Consent of Independent Public Accountants.

            *27      Financial Data Schedule (EDGAR submission only).

              *      Filed herewith.

             **      Incorporated by reference.
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