<PAGE>   1
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                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                    FORM 10-Q

[X]      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
         SECURITIES EXCHANGE ACT OF 1934
         FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2000


[ ]      TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
         SECURITIES EXCHANGE ACT OF 1934
         FOR THE TRANSITION PERIOD FROM __________ TO __________

                          Commission File No. 000-29226


                       VALLEY NATIONAL GASES INCORPORATED
             (Exact name of registrant as specified in its charter)

         PENNSYLVANIA                                    23-2888240
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
incorporation or organization)

                                 67 43RD STREET
                          WHEELING, WEST VIRGINIA 26003
                    (Address of principal executive offices)

                                 (304) 232-1541
              (Registrant's telephone number, including area code)

Indicate by checkmark  whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.


                                Yes   X       No
                                    -----        -----

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


          Class                                      Outstanding at May 12, 2000
          -----                                      ---------------------------
Common stock, $0.001 par value                                 9,347,584

================================================================================
<PAGE>   2
                       Valley National Gases Incorporated

                                TABLE OF CONTENTS

                                                                            Page

PART I   FINANCIAL INFORMATION

     Item 1   Condensed Consolidated Balance Sheets as of June 30, 1999
              and March 31, 2000                                               3

              Condensed Consolidated Statements of Operations for the
              Three Months Ended March 31, 1999 and 2000                       5
              Condensed Consolidated Statements of Operations for the
              Nine Months Ended March 31, 1999 and 2000                        6
              Condensed Consolidated Statements of Cash Flows for the
              Nine Months Ended March 31, 1999 and 2000                        7
              Notes to Condensed Consolidated Financial Statements             8

     Item 2   Management's Discussion and Analysis of Financial
              Condition and Results of Operations                             11

     Item 3   Quantitative and Qualitative Disclosures About Market Risk      16

PART II  OTHER INFORMATION

     Item 6   Exhibits and Reports on Form 8-K                                16

     Signatures                                                               17

     Exhibit Index                                                            18


                                     - 2 -
<PAGE>   3
                          PART I. FINANCIAL INFORMATION

ITEM I.  FINANCIAL STATEMENTS

                       VALLEY NATIONAL GASES INCORPORATED

                      CONDENSED CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                     A S S E T S
                     -----------
                                                                               June 30,                March 31,
                                                                                 1999                    2000
                                                                             ------------            ------------
                                                                                                      (Unaudited)
<S>                                                                          <C>                     <C>
CURRENT ASSETS:
    Cash and cash equivalents                                                $    224,708            $  1,510,659
    Accounts receivable, net of allowance for
       doubtful accounts of $454,981 and
       $589,423, respectively                                                  11,960,059              16,658,645
    Inventory                                                                  11,173,995              13,234,819
    Prepaids and other                                                          1,965,966                 845,579
                                                                             ------------            ------------

                  Total current assets                                         25,324,728              32,249,702
                                                                             ------------            ------------

PROPERTY, PLANT AND EQUIPMENT:
    Land                                                                           49,786                  33,000
    Buildings and improvements                                                  4,413,900               4,662,356
    Equipment                                                                  56,906,554              65,783,124
    Transportation equipment                                                   10,172,945              11,647,442
    Furniture and fixtures                                                      4,102,422               4,510,071
                                                                             ------------            ------------

                  Total property, plant and equipment                          75,645,607              86,635,993

    Accumulated depreciation                                                  (29,857,130)            (33,288,273)
                                                                             ------------            ------------

                  Net property, plant and equipment                            45,788,477              53,347,720
                                                                             ------------            ------------

OTHER ASSETS:
    Intangibles, net of amortization of $10,268,270
       and $13,566,909, respectively                                           35,773,717              44,741,976
    Deposits and other assets                                                   1,638,801               1,545,052
                                                                             ------------            ------------

                  Total other assets                                           37,412,518              46,287,028
                                                                             ------------            ------------

TOTAL ASSETS                                                                 $108,525,723            $131,884,450
                                                                             ============            ============
</TABLE>

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


                                     - 3 -
<PAGE>   4
                       VALLEY NATIONAL GASES INCORPORATED

                      CONDENSED CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
     LIABILITIES AND STOCKHOLDERS' EQUITY                                            June 30,                March 31,
     ------------------------------------                                              1999                    2000
                                                                                   ------------            ------------
                                                                                                            (Unaudited)
<S>                                                                                <C>                     <C>
CURRENT LIABILITIES:
    Current maturities of long-term debt                                           $  6,294,130            $  7,265,111
    Bank overdraft                                                                           --               1,114,624
    Accounts payable, trade                                                           4,418,974               3,688,786
    Accrued compensation and employee benefits                                        3,198,918               3,190,653
    Other current liabilities                                                         1,799,297               3,304,389
                                                                                   ------------            ------------

                  Total current liabilities                                          15,711,319              18,563,563

LONG-TERM DEBT, less current maturities                                              56,242,003              72,297,347
DEFERRED TAX LIABILITY                                                                7,864,661               9,240,899
OTHER LONG-TERM LIABILITIES                                                           1,663,096               1,876,933
                                                                                   ------------            ------------

                  Total liabilities                                                  81,481,079             101,978,742
                                                                                   ------------            ------------

STOCKHOLDERS' EQUITY:
    Common stock, par value, $.001 per share-
    Authorized, 30,000,000 shares
    Issued, 9,620,084 shares                                                              9,620                   9,620
    Paid-in-capital                                                                  19,269,338              19,269,338
    Retained earnings                                                                10,029,114              12,890,178
    Treasury stock at cost, 272,500 shares                                           (2,263,428)             (2,263,428)
                                                                                   ------------            ------------

                  Total stockholders' equity                                         27,044,644              29,905,708
                                                                                   ------------            ------------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                         $108,525,723            $131,884,450
                                                                                   ============            ============
</TABLE>

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


                                     - 4 -
<PAGE>   5
                       VALLEY NATIONAL GASES INCORPORATED

                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                          Three Months Ended
                                                                                               March 31,
                                                                                   ----------------------------------
                                                                                      1999                   2000
                                                                                   -----------           ------------
<S>                                                                                <C>                    <C>
NET SALES                                                                          $28,027,430            $36,822,963
COST OF PRODUCTS SOLD, excluding depreciation
    and amortization                                                                12,711,518             18,654,262
                                                                                   -----------            -----------
                  Gross profit                                                      15,315,912             18,168,701
                                                                                   -----------            -----------

EXPENSES:

    Operating and administrative                                                    10,247,292             11,959,542
    Depreciation and amortization                                                    2,102,076              2,542,403
                                                                                   -----------            -----------
                  Total expenses                                                    12,349,368             14,501,945
                                                                                   -----------            -----------
                  Income from operations                                             2,966,544              3,666,756

INTEREST EXPENSE                                                                     1,002,027              1,476,451
OTHER INCOME (EXPENSE) NET                                                              62,958                 80,032
                                                                                   -----------            -----------
EARNINGS BEFORE INCOME TAXES                                                         2,027,475              2,270,337

PROVISION FOR INCOME TAXES                                                             831,264                998,948
                                                                                   -----------            -----------
NET EARNINGS                                                                         1,196,211              1,271,389
                                                                                   ===========            ===========

ACCRETION OF REDEEMABLE COMMON STOCK                                                   131,353                     --
                                                                                   -----------            -----------
NET EARNINGS AVAILABLE FOR COMMON STOCK                                            $ 1,064,858            $ 1,271,389
                                                                                   ===========            ===========

BASIC EARNINGS PER SHARE                                                           $      0.11            $      0.14
DILUTED EARNINGS PER SHARE                                                                0.11                   0.14
WEIGHTED AVERAGE SHARES:
   Basic                                                                             9,535,278              9,347,584
   Diluted                                                                           9,535,278              9,354,439
</TABLE>

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


                                     - 5 -
<PAGE>   6
                       VALLEY NATIONAL GASES INCORPORATED

                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                            Nine Months Ended
                                                                                                 March 31,
                                                                                   -----------------------------------
                                                                                       1999                   2000
                                                                                   ------------            -----------
<S>                                                                                 <C>                    <C>
NET SALES                                                                           $75,853,143            $93,651,031
COST OF PRODUCTS SOLD, excluding depreciation
    and amortization                                                                 34,185,287             46,150,301
                                                                                   ------------            -----------
                  Gross profit                                                       41,667,856             47,500,730
                                                                                   ------------            -----------

EXPENSES:

    Operating and administrative                                                     27,985,380             31,924,054
    Depreciation and amortization                                                     6,079,907              6,955,264
                                                                                   ------------            -----------
                  Total expenses                                                     34,065,287             38,879,318
                                                                                   ------------            -----------
                  Income from operations                                              7,602,569              8,621,412

INTEREST EXPENSE                                                                      2,940,057              3,772,360
OTHER INCOME (EXPENSE) NET                                                              193,974                259,990
                                                                                   ------------            -----------
EARNINGS BEFORE INCOME TAXES                                                          4,856,486              5,109,042

PROVISION FOR INCOME TAXES                                                            1,991,159              2,247,978
                                                                                   ------------            -----------

NET EARNINGS                                                                          2,865,327              2,861,064
                                                                                   ============            ===========

ACCRETION OF REDEEMABLE COMMON STOCK                                                    227,178                     --
                                                                                   ------------            -----------
NET EARNINGS AVAILABLE FOR COMMON STOCK                                            $  2,638,149            $ 2,861,064
                                                                                   ============            ===========

BASIC EARNINGS PER SHARE                                                           $       0.28            $      0.31
DILUTED EARNINGS PER SHARE                                                                 0.27                   0.31
WEIGHTED AVERAGE SHARES                                                               9,591,646              9,347,584
DILUTED AVERAGE SHARES                                                                9,603,731              9,350,348
</TABLE>

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


                                     - 6 -
<PAGE>   7
                       VALLEY NATIONAL GASES INCORPORATED

                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                          Nine Months Ended
                                                                                               March 31,
                                                                                 ------------------------------------
                                                                                     1999                    2000
                                                                                 ------------            ------------
<S>                                                                              <C>                     <C>
NET CASH PROVIDED BY OPERATING ACTIVITIES                                        $  6,591,520            $  5,889,437
                                                                                 ------------            ------------

CASH FLOWS FROM INVESTING ACTIVITIES:
    Proceeds from disposal of assets                                                    8,922                 231,545
    Purchases of property and equipment                                            (5,261,115)             (4,619,393)
    Business acquisitions, net of cash acquired                                    (7,496,390)             (9,752,174)
                                                                                 ------------            ------------

                  Net cash used by investing activities                           (12,748,583)            (14,140,022)

CASH FLOWS FROM FINANCING ACTIVITIES:
    Proceeds from borrowings                                                       17,824,049              21,453,074
    Principal payments on loans                                                    (9,500,939)            (11,916,538)
    Purchase of treasury shares                                                    (2,263,428)                     --
                                                                                 ------------            ------------

                         Net cash provided by
                             financing activities                                   6,059,682               9,536,536
                                                                                 ------------            ------------

NET CHANGE IN CASH AND CASH EQUIVALENTS                                               (97,381)              1,285,951

CASH AND CASH EQUIVALENTS, beginning of period                                        589,170                 224,708
                                                                                 ------------            ------------

CASH AND CASH EQUIVALENTS, end of period                                         $    491,789            $  1,510,659
                                                                                 ============            ============

SUPPLEMENTAL CASH FLOW INFORMATION:

    Cash payments for interest                                                   $  2,944,963            $  3,327,904
                                                                                 ============            ============
    Cash payments for income taxes                                               $  1,316,284            $    901,280
                                                                                 ============            ============
</TABLE>

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


                                     - 7 -
<PAGE>   8
                       VALLEY NATIONAL GASES INCORPORATED

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1.   BASIS OF PRESENTATION:

     The financial statements of Valley National Gases Incorporated (the
Company) presented herein are unaudited. Certain information and footnote
disclosures normally prepared in accordance with generally accepted accounting
principles have been either condensed or omitted pursuant to the rules and
regulations of the Securities and Exchange Commission. Although the Company
believes that all adjustments, consisting of only normal recurring adjustments,
necessary for a fair presentation have been made, interim periods are not
necessarily indicative of the financial results of operations for a full year.
As such, these financial statements should be read in conjunction with the
financial statements and notes thereto included or incorporated by reference in
the Company's audited financial statements for the period ending June 30, 1999.

2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

INVENTORY

     Inventory is carried at the lower of cost or market using the first-in,
first-out (FIFO) method.

     The components of inventory are as follows:

<TABLE>
<CAPTION>
                                      June 30,              March 31,
                                        1999                  2000
                                     -----------           -----------
                                                           (Unaudited)
<S>                                  <C>                   <C>
        Hardgoods                    $ 9,753,794           $12,237,335
        Gases                          1,420,201               997,484
                                     -----------           -----------

                                     $11,173,995           $13,234,819
                                     ===========           ===========
</TABLE>

PLANT AND EQUIPMENT

     Plant and equipment are stated at cost. Depreciation is provided on the
straight-line basis over the estimated useful lives of the related assets.

     Effective July 1, 1998, the Company changed its estimate of the useful
lives of its cylinders and tanks from 12 to 30 years. This change was made to
better reflect the estimated periods during which these assets will remain in
service.

     The Company changed the estimated useful life of cylinders as a result of
thorough studies and analyses. The studies considered technological advances in
cylinders, empirical data obtained from cylinder manufacturers and other
industry experts and experience gained from the Company's maintenance of a
cylinder population of approximately 400,000 cylinders.

3.   ACQUISITIONS:

     The Company acquires businesses engaged in the distribution of industrial,
medical and specialty gases and related welding supplies and accessories.
Acquisitions have been recorded using the purchase method of accounting and,
accordingly, results of their operations have been included in the Company's
financial statements since the effective dates of the respective acquisitions.


                                     - 8 -
<PAGE>   9
     During the nine months ended March 31, 2000, the Company purchased five
businesses. The largest of these acquisitions and the effective date was Lee's
Gas Supply, Inc. (December 1999).

     In connection with these acquisitions, the total purchase price, fair value
of assets acquired, cash paid and liabilities assumed were as follows:

<TABLE>
<CAPTION>
                                                                     Nine Months
                                                                       Ended
                                                                      March 31,
                                                                        2000
                                                                     -----------
                                                                     (Unaudited)
<S>                                                                  <C>
        Cash paid                                                    $ 9,856,996
        Notes issued to sellers                                        2,000,000
        Notes payable and capital leases assumed
                                                                       2,239,789

        Other liabilities assumed and acquisition costs                3,150,000
                                                                     -----------
        Total purchase price allocated to assets acquired            $17,246,785
                                                                     ===========
</TABLE>


4.   LONG-TERM DEBT:

     Long-term debt consists of the following:

<TABLE>
<CAPTION>
                                                                                       June 30,                March 31,
                                                                                         1999                    2000
                                                                                      -----------             -----------
                                                                                                              (Unaudited)
<S>                                                                                   <C>                     <C>
Revolving note, interest at LIBOR plus 1.875%
     payable monthly through January 2001. Secured
     by the assets of the Company.                                                    $36,756,726             $53,881,202

Term note, interest at LIBOR plus 1.875% payable
     monthly through October 2003. Secured by the
     assets of the Company.                                                            10,872,905               8,954,150

Note payable, interest at 6.6% payable annually
     through October 2003. Secured by certain
     assets of the Company.                                                             3,415,372               2,732,298

Individuals and corporations, mortgages and
     notes, interest at 3.7% to 10.00%, payable at
     various dates through 2010.                                                       11,648,116              14,134,917
                                                                                      -----------             -----------

                                                                                       62,693,119              79,702,567
                  Original issue discount                                                (156,986)               (140,109)
                  Current maturities                                                   (6,294,130)             (7,265,111)
                                                                                      -----------             -----------

Total long-term debt                                                                  $56,242,003             $72,297,347
                                                                                      ===========             ===========
</TABLE>


Prime rate was 9.0% and LIBOR was 6.0% at March 31, 2000.

     On February 5, 1998 the Company entered into an amended and restated credit
facility with Bank One, as agent. The new credit facility increased the maximum
revolving note borrowings to $75.3 million, including a letter of credit
sublimit of $25.0 million, and refinanced the term note at the existing balance
of $14.7 million. The new scheduled maturity date of the term note is October 4,
2003. The new scheduled maturity date of the revolving note is January 16, 2001.
The Company pays a fee for the unused portion of the revolving loan. The
revolving loan is used primarily to fund acquisitions. The Company is not
required to make principal


                                     - 9 -
<PAGE>   10

payments on outstanding balances of the revolving loan as long as certain
covenants are satisfied. Interest is charged on both the term loan and the
revolving loan at either the lender's prime rate or various LIBOR rates, at the
Company's discretion, plus an applicable spread. The weighted average interest
rate for substantially all of the borrowings under the credit facility was 8.1%
as of March 31, 2000. As of March 31, 2000, availability under the revolving
loan was approximately $13.6 million, with outstanding borrowings of
approximately $53.9 million and outstanding letters of credit of approximately
$7.8 million. The credit facility is secured by all of the Company's assets.

     The loan agreement for the credit facility contains various financial
covenants applicable to the Company, including covenants requiring minimum fixed
charge coverage, maximum funded debt to EBITDA, and minimum net worth. The
Company is in compliance with these covenants and believes that it will continue
to be in compliance through at least the next twelve months.

     On May 1, 2000, the Company amended its credit facility with its banks. See
Note 6 for further discussion.

5.   EARNINGS PER SHARE

     Basic earnings per share were computed based on the weighted average number
of common shares issued and outstanding during the relevant periods. Diluted
earnings per common share were computed based on the weighted average number of
common shares issued and outstanding plus additional shares assumed to be
outstanding to reflect the dilutive effect of common stock equivalents using the
treasury stock method.

     Options to purchase 232,400 shares of common stock were outstanding during
the nine months and quarter ended March 31, 2000, but were not included in the
computation of diluted earnings per common share as the options' exercise price
was greater than the average market price of the common stock for the period.

<TABLE>
<CAPTION>
                                                            Three Months Ended                           Nine Months Ended
                                                                  March 31,                                   March 31,
                                                      -------------------------------             --------------------------------
                                                         1999                 2000                   1999                  2000
                                                      ----------           ----------             ----------           -----------
<S>                                                   <C>                  <C>                    <C>                  <C>
Net earnings available for common
stock                                                 $1,064,858           $1,271,389             $2,638,149           $ 2,861,064
                                                      ==========           ==========             ==========           ===========

Basic earnings per common share:

Weighted average common shares                         9,535,278            9,347,584              9,591,656             9,347,584
                                                      ==========           ==========             ==========           ===========

Basic earnings per common share                       $     0.11           $     0.14             $     0.28           $      0.31
                                                      ==========           ==========             ==========           ===========

Diluted earnings per common share:

Weighted average common shares                         9,535,278            9,347,584              9,591,656             9,347,584

Shares issuable from assumed
conversion of common stock
equivalents                                                   --                6,855                 12,075                 2,764
                                                      ----------           ----------             ----------           -----------

Weighted average common and common
equivalent shares                                      9,535,278            9,354,439              9,603,731             9,350,348
                                                      ==========           ==========             ==========           ===========
Diluted earnings per common share                     $     0.11           $     0.14             $     0.27           $      0.31
                                                      ==========           ==========             ==========           ===========
</TABLE>


                                     - 10 -
<PAGE>   11

6.   SUBSEQUENT EVENTS

     On May 1, 2000, the Company entered into a second amended and restated
credit agreement with Bank One, as agent. This agreement increased the maximum
revolving note borrowings to $100 million, from the previous maximum borrowings
level of $75.3 million, and extended the maturity of the revolving note to May
1, 2003. The agreement permits the Company, on an annual basis, to request that
the maturity be extended one year. No significant changes were made to pricing
and the covenant requirements when compared to the original agreement.

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

     The following discussion should be read in conjunction with, and is
qualified in its entirety by, the Financial Statements and the Notes thereto.

OVERVIEW

     The Company is a leading packager and distributor of industrial, medical
and specialty gases, welding equipment and supplies, and propane in eleven
states in the mid-Atlantic and midwestern regions of the United States. The
Company's net sales have grown, primarily as a result of acquisitions, at a
compound annual rate of approximately 17% per year since the Company started
business in 1958, increasing from $190,000 in that year to $120.1 million for
the last twelve months. In fiscal 1999, gases accounted for approximately 40% of
net sales, welding equipment and supplies accounted for approximately 45% of net
sales, and cylinder and tank rental accounted for approximately 15% of net
sales.

     The Company believes it has been successful in executing its strategy of
growth through acquisitions, having completed 46 acquisitions since 1990. Some
acquisitions have had, and the Company expects some future acquisitions may
have, a dilutive effect upon the Company's income from operations and net income
before tax for a short period following consummation. This temporary dilution
occurs because some of the benefits of acquisitions, such as leveraging of
operating and administrative expenses, improved product gross margins and real
sales growth, occur over a period ranging from two to eight quarters, depending
upon the complexity of integrating each acquisition into the Company's existing
operations. The consideration for most acquisitions includes a combination of a
cash payment at closing, seller financing and payments under covenants not to
compete and consulting agreements. In most cases, operating cash flow of an
acquired business is positive in a relatively short period of time. For many
acquisitions, the Company believes that projections of future cash flows justify
payment of amounts in excess of the book or market value of the assets acquired,
resulting in goodwill being recorded.

     The Company's results are subject to moderate seasonality, primarily due to
fluctuations in the demand for propane, which is highest during winter months
falling in the Company's second and third fiscal quarters. Seasonality of total
sales has increased as propane sales as a percentage of total sales have
increased.

     Operating and administrative expenses are comprised primarily of salaries,
benefits, transportation equipment operating costs, facility lease expenses and
general office expenses. These expenses are generally fixed on a quarter-
to-quarter basis. The Company believes that changes in these expenses as a
percentage of sales should be evaluated over the long term rather than on a
quarter-to-quarter basis due to the seasonality of sales mentioned above and the
generally fixed nature of these expenses.


                                     - 11 -
<PAGE>   12

     Historically, the Company's gross profit margins as a percentage of sales
have been higher on the sale of gases than on the sale of welding equipment and
supplies ("hard goods"). As a result of recent acquisitions of some distributors
with a higher proportion of hard goods to gas sales, the Company's average gross
profit as a percentage of sales, in some cases, has decreased in comparison to
prior years. Future acquisitions may affect this pattern depending upon the
product mix of the acquired businesses.

RESULTS OF OPERATIONS

Comparison of Three Months Ended March 31, 2000 and 1999

     Net sales increased 31.4%, or $8.8 million, to $36.8 million from $28.0
million for the three months ended March 31, 2000 and 1999, respectively.
Acquisitions made during the preceeding twelve months contributed $4.4 million
of the increase in net sales, while same store sales increased $4.4 million.
Same store sales increased 15.6% versus the same quarter last year. Gases and
cylinder revenue represented 57.5% of net sales for the three months ended March
31, 2000, with hard goods representing 42.5%. In comparison, net sales for the
three months ended March 31, 1999 reflected gases and cylinder revenue as 57.4%
and hard goods as 42.6%.

     Gross profit, which excludes depreciation and amortization, increased
18.6%, or $2.9 million, to $18.2 million from $15.3 million for the three months
ended March 31, 2000 and 1999, respectively. Of this increase, $2.2 million was
attributable to acquisitions made during the last twelve months. Same stores
contributed an increase of $0.7 million versus the same quarter last year. Gross
profit as a percentage of net sales was 49.3% for the three months ended March
31, 2000, compared to 54.6% for the three months ended March 31, 1999. Reduced
gross profit as a percentage of sales for propane products reduced the total
company average 4.4%. The balance of the change was primarily the result of
changes in the mix of products sold. Propane costs averaged 100% higher for the
quarter compared to the same quarter last year as sales per gallon increased
37%. The increase in propane cost for the quarter was consistent with industry
changes in heating fuel costs. Gross profit as a percentage of sales, for
propane products decreased 19% compared to the prior year quarter with gross
profit decreasing $.04 per gallon.

     Operating and administrative expenses increased 16.7%, or $1.7 million, to
$12.0 million from $10.3 million for the three months ended March 31, 2000 and
1999, respectively. Of this increase, $1.5 million was related to acquired
businesses while base business increased $0.2 million. Operating and
administrative expenses as a percentage of sales was 32.5% for the three months
ended March 31, 2000, as compared to 36.6% for the same quarter in 1999. This
reflects the effect of leveraging acquisitions made during the last twelve
months, the before mentioned increase in same store sales and the Company's cost
containment efforts.

     Depreciation and amortization expense increased $0.4 million for the three
months ended March 31, 2000 compared to the same period in 1999, reflecting the
increase from acquisitions made during the last twelve months.

     Interest expense increased $0.5 million for the quarter, reflecting the
financing of acquisitions made during the last twelve months and increases in
bank interest rates.

     Net earnings increased 19.4% to $1.3 million for the three months ended
March 31, 2000 compared to $1.1 million after accretion of redeemable common
stock for the prior year quarter.

Comparison of Nine Months Ended March 31, 2000 and 1999

     Net sales increased 23.5%, or $17.8 million, to $93.7 million from $75.9
million for the nine months ended March 31, 2000 and 1999, respectively.
Acquisitions made


                                     - 12 -
<PAGE>   13

during the preceding twelve months contributed $9.7 million of the increase in
net sales, while same store sales increased $8.1 million. Same store sales
increased 10.7% versus the same period last year reflecting increased propane
sales, a partial recovery in steel related markets and the Company's efforts to
improve service to its customers. Gases and cylinder revenue represented 55.8%
of net sales for the nine months ended March 31, 2000, with hard goods
representing 44.2%. In comparison, net sales for the nine months ended March 31,
1999 reflected gases and cylinder revenue as 56.3% and hard goods as 43.7%. This
change in sales mix reflects the effect of acquisitions made during the
preceding twelve months and the before mentioned factors that affected same
store sales.

     Gross profit, which excludes depreciation and amortization, increased
14.0%, or $5.8 million, to $47.5 million from $41.7 million for the nine months
ended March 31, 2000 and 1999, respectively. Acquisitions made during the
preceeding twelve months contributed $4.9 million of the increase in gross
profit, while the gross profit in the base business increased $0.9 million.
Gross profit as a percentage of net sales was 50.7% for the nine months ended
March 31, 2000, compared to 54.9% for the nine months ended March 31, 1999. This
change reflects, primarily, the effect of decreased gross profit, as a
percentage of sales, for propane products.

     Operating and administrative expenses increased 14.1%, or $3.9 million, to
$31.9 million from $28.0 million for the nine months ended March 31, 2000 and
1999, respectively. Of this increase, $3.3 million was related to acquired
businesses and the remaining $0.6 million reflected increases on a same store
basis. Operating and administrative expenses as a percentage of sales was 34.1%
for the nine months ended March 31, 2000, as compared to 36.9% for the same
period in 1999, reflecting the addition of operating expenses related to
acquired businesses as a percentage of sales and the effect of the increase in
same store sales.

     Depreciation and amortization expense increased $0.9 million for the nine
months ended March 31, 2000 compared to the same period in 1999, reflecting the
increase from acquisitions made during the last twelve months.

     Interest expense increased $0.8 million for the nine months, reflecting the
financing of acquisitions made during the last twelve months along with the
increase in bank interest rates.

     Net earnings increased to $2.9 million for the nine months ended March 31,
2000 compared to $2.6 million, after accretion of redeemable common stock, for
the same period last year.

YEAR 2000 COMPLIANCE

     Our Year 2000 compliance efforts were completed and we have experienced no
problems to date with our internal automated systems as a result of Year 2000.
In or before 1999, many of our critical suppliers and vendors indicated that
they were, or would be, Year 2000 compliant during 1999. We have not
experienced, and are not aware of, any Year 2000 problems affecting our critical
suppliers and vendors. We cannot guarantee that our efforts will prevent a
material adverse impact on our results of operations, financial condition or
cash flow that might result from the failure of any key third party systems to
accommodate the Year 2000 problem. We believe our efforts to address the Year
2000 issue will minimize possible negative consequences to Valley National
Gases, Inc.

LIQUIDITY AND CAPITAL RESOURCES

     Historically, the Company has financed its operations, capital expenditures
and debt service with funds provided from operating activities. Acquisitions
have been financed by a combination of seller financing, bank borrowings and
funds generated from operations.


                                     - 13 -
<PAGE>   14

     At March 31, 2000, the Company had working capital of approximately $13.7
million. Funds provided by operations for the nine months ended March 31, 2000
were approximately $5.9 million. Funds used for investing activities were
approximately $14.1 million for the nine months ended March 31, 2000, consisting
primarily of capital spending and financing for acquisitions. Sources of funds
from financing activities for the nine months ended March 31, 2000 were
approximately $9.5 million from net borrowings. The Company's cash balance
increased $1.3 million during the nine months to $1.5 million.

     On February 5, 1998 the Company entered into an amended and restated credit
facility with Bank One, as agent. The new credit facility increased the maximum
revolving note borrowings to $75.3 million, including a letter of credit
sublimit of $25.0 million, and refinanced the term note at the existing balance
of $14.7 million. The new scheduled maturity date of the term note is October 4,
2003. The new scheduled maturity date of the revolving note is January 16, 2001.
The Company pays a fee for the unused portion of the revolving loan. The
revolving loan is used primarily to fund acquisitions. The Company is not
required to make principal payments on outstanding balances of the revolving
loan as long as certain covenants are satisfied. Interest is charged on both the
term loan and the revolving loan at either the lender's prime rate or various
LIBOR rates, at the Company's discretion, plus an applicable spread. The
weighted average interest rate for substantially all of the borrowings under the
credit facility was 8.1% as of March 31, 2000. As of March 31, 2000,
availability under the revolving loan was approximately $13.6 million, with
outstanding borrowings of approximately $53.9 million and outstanding letters of
credit of approximately $7.8 million. The credit facility is secured by all of
the Company's assets.

     The loan agreement for the credit facility contains various financial
covenants applicable to the Company, including covenants requiring minimum fixed
charge coverage, maximum funded debt to EBITDA, and minimum net worth. The
Company is in compliance with these covenants and believes that it will continue
to be in compliance through at least the next twelve months.

     On May 1, 2000, the Company entered into a second amended and restated
credit agreement with Bank One, as agent. This agreement increased the maximum
revolving note borrowings to $100 million, from the previous maximum borrowings
level of $75.3 million, and extended the maturity of the revolving note to May
1, 2003. The agreement permits the Company, on an annual basis, to request that
the maturity be extended one year. No significant changes were made to pricing
and the covenant requirements when compared to the original agreement.

     The Company is obligated under various promissory notes related to the
financing of acquisitions that have various rates of interest, ranging from 3.7%
to 10.0% per annum, and maturities through 2010. The outstanding balance of
these notes as of March 31, 2000 was $16.9 million. Some of these notes are
secured by assets related to the applicable acquisition, some are unsecured, and
some are backed by bank letters of credit issued under the Company's credit
facility.

     On December 23, 1997, the Company entered into two interest rate swap
agreements with Bank One to reduce the impact of changes in interest rates. The
first agreement was for a period of seven years, cancelable by the bank at the
end of five years, whereby the Company agreed to pay the bank a fixed rate of
5.90% per annum on the notional principal amount of $5.0 million and the bank
agreed to pay the Company the one month LIBOR rate on the same notional amount.
The second agreement was for a period of five years, cancelable by the bank at
the end of three years, whereby the Company agreed to pay the bank a fixed rate
of 5.80% per annum on the notional principal amount of $5.0 million and the bank
agreed to pay the Company the one month LIBOR rate on the same notional amount.
On January 15, 1998, the Company entered into two interest rate swap agreements
with Bank One to reduce the impact of changes in interest rates. The first
agreement was for a period of seven years, cancelable by the bank at the end of
five years, whereby, the Company agreed to pay the bank a


                                     - 14 -
<PAGE>   15


fixed rate of 5.43% per annum on the notional principal amount of $10.0 million
and the bank agreed to pay the Company the one month LIBOR rate on the same
notional amount. The second agreement was for a period of five years, cancelable
by the bank at the end of three years, whereby, the Company agreed to pay the
bank a fixed rate of 5.29% per annum on the notional principal amount of $10.0
million and the bank agreed to pay the Company the one month LIBOR rate on the
same notional amount. On August 28, 1998, the Company entered into an interest
rate swap agreement with Bank One to reduce the impact of changes in interest
rates. This agreement was for a period of five years, cancelable by the bank at
the end of three years, whereby, the Company agreed to pay the bank a fixed rate
of 5.40% per annum on the notional principal amount of $5.0 million and the bank
agreed to pay the Company the one month LIBOR rate on the same notional amount.
The Company is exposed to credit loss in the event of nonperformance by the
bank. However, the Company does not anticipate nonperformance by the bank.

    The Company has entered into a put/call option agreement with an independent
distributor for the purchase of its business. This option becomes exercisable
beginning in the year 2002 and ending in the year 2008. The Company believes
that it will have adequate capital resources available to fund this acquisition
at such time that the option is exercised.

FLUCTUATIONS IN QUARTERLY RESULTS

    The Company generally has experienced higher sales activity during its
second and third quarters as a result of seasonal sales of propane, with
corresponding lower sales for the first and fourth quarters. As a result, income
from operations and net income typically are higher for the second and third
quarters than for the first and fourth quarters of the fiscal year.

INFLATION

    The impact of inflation on the Company's operating results has been moderate
in recent years, reflecting generally low rates of inflation in the economy and
the Company's historical ability to pass purchase price increases to its
customers in the form of sales price increases. While inflation has not had, and
the Company does not expect that it will have, a material impact upon operating
results, there is no assurance that the Company's business will not be affected
by inflation in the future.

SUBSEQUENT EVENTS

    On May 1, 2000, the Company entered into a second amended and restated
credit agreement with Bank One, as agent. This agreement increased the maximum
revolving note borrowings to $100 million, from the previous maximum borrowings
level of $75.3 million, and extended the maturity of the revolving note to May
1, 2003. The agreement permits the Company, on an annual basis, to request that
the maturity be extended one year. No significant changes were made to pricing
and the covenant requirements when compared to the original agreement.

RECENT ACCOUNTING PRONOUNCEMENTS

    On June 15, 1998, the Financial Accounting Standards Board ("FASB") issued
Financial Accounting Standards No. 133, "Accounting for Derivative Instruments
and Hedging Activities". The Statement establishes accounting and reporting
standards requiring that every derivative  instrument  (including certain
derivative instruments embedded in other contracts) be recorded in the balance
sheet as either an asset or liability measured at its fair value. The Statement
requires that changes in the derivative's fair value be recognized currently in
earnings unless specific hedge accounting criteria are met.

    In June 1999, the FASB issued Financial Accounting Standards No. 137,
Accounting


                                     - 15 -
<PAGE>   16

for Derivative Instruments and Hedging Activities - Deferral of the effective
date of SFAS No 133." Both statements are effective for years beginning after
June 15, 2000.

     The Company has not yet quantified the impact of adopting Statement 133 on
our financial statements. However, the Statement could increase volatility in
earnings.

ITEM 3.       QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     No change has occurred since the filing by the Registrant on Form 10-K for
the year ended June 30, 1999. Reference is made to Part II, Item 7A,
Quantitative and Qualitative Disclosures About Market Risk, in the Registrant's
Annual Report on Form 10-K for the year ended June 30, 1999.

     There was no change to the composition of the Company's fixed and variable
rate long term debt or interest rate swaps during the nine months ended March
31, 2000. As of March 31, 2000 the Company's average pay rate for these swaps
was 5.51% compared to its average receive rate of 6.01%.


                           PART II. OTHER INFORMATION

ITEM 6.       EXHIBITS AND REPORTS ON FORM 8-K

     (a)  Exhibits:

          See the Exhibit Index on page 18.

     (b)  Reports on Form 8-K:

          No reports on Form 8-K were made during the quarter.


                                     - 16 -
<PAGE>   17
                                   SIGNATURES

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

                                       VALLEY NATIONAL GASES INCORPORATED



May 15, 2000                           /s/ Robert D. Scherich
                                       -----------------------------------------
                                       Robert D. Scherich
                                       Chief Financial Officer


                                     - 17 -
<PAGE>   18
                                  EXHIBIT INDEX

Exhibit Number   Description
--------------   -------------------------------------------------------------

3.1              Articles of Amendment of the Company, incorporated by reference
                 to Exhibit 3.1 to the Company's Registration Statement on Form
                 S-1 under the Securities Act of 1933, as amended, (File No.
                 333-19973)

3.2              Bylaws of the Company, incorporated by reference to Exhibit 3.2
                 to the Company's Registration Statement on Form S-1 under the
                 Securities Act of 1933, as amended, (File No. 333-19973)

10.18            Second Amended and Restated Credit Agreement dated May 1, 2000,
                 between the Company and Bank One, Indiana NA, as agent

27.1             Financial Data Schedule (provided for the information of the
                 U.S. Securities and Exchange Commission only)


                                     - 18 -