<PAGE>

                                    FORM 10-Q


                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549


          (Mark One)

          [ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934
               For the quarterly period ended: September 29, 2001
            ---------------------------------------------------------
                                       OR

          [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934
                  For the transition period from: _______ to

                        Commission file number: 333-37135
                                               ----------


                              Omega Cabinets, Ltd.
             ------------------------------------------------------
             (Exact name of registrant as specified in its charter)

             Delaware                                    42-1423186
        ---------------------                        ---------------------
     (State or other jurisdiction                      (I.R.S. Employer
     incorporation or organization                   Identification Number)


                     1205 Peters Drive, Waterloo, Iowa 50703
     ----------------------------------------------------------------------
                    (Address of principal executive offices)
                                   (Zip Code)

                                 (319) 235-5700
              ----------------------------------------------------
               Registrants telephone number, including area code)


                                 Not Applicable
              ----------------------------------------------------
             (Former name, former address and former fiscal year,
                         if changed since last report)

Indicate by check mark whether 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 [  ]

                APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
                  PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. Yes [ ] No [ ] Not Applicable.

                      APPLICABLE ONLY TO CORPORATE ISSUERS

Indicate the number of shares outstanding of each of the issuer's classes of
common stock as of the latest practicable date. On September 29, 2001, all of
the voting stock of Omega Cabinets Ltd. was held by Omega Holdings, Inc.
("Holdings"), a Delaware corporation. As of September 29, 2001, Omega Cabinets,
Ltd. had 1,000 shares of Common Stock issued and outstanding.
<PAGE>

                         PART I - FINANCIAL INFORMATION


ITEM 1. FINANCIAL STATEMENTS

The following financial statements are presented herein:

   Condensed Consolidated Balance Sheets as of September 29, 2001
      and December 30, 2000

   Condensed Consolidated Statements of Income for the three months and nine
      months ended September 29, 2001 and September 30, 2000

   Condensed Consolidated Statements of Cash Flows for the nine months ended
      September 29, 2001 and September 30, 2000

   Notes to Condensed Consolidated Financial Statements
<PAGE>

                              Omega Cabinets, Ltd.

                      Condensed Consolidated Balance Sheets

<TABLE>
<CAPTION>
                                                                      SEPTEMBER 29        DECEMBER 30
                                                                          2001                2000
                                                                       (UNAUDITED)           (NOTE)
                                                                   ----------------------------------------
<S>                                                                   <C>                <C>
ASSETS
Current assets:
   Cash                                                                 $  4,248,279       $  2,982,601
   Accounts receivable                                                    31,562,766         22,921,739
   Inventories (Note 2)                                                   18,349,350         17,605,364
   Other current assets                                                    4,700,813          4,531,065
                                                                   ----------------------------------------
Total current assets                                                    $ 58,861,208         48,040,769

Property, plant and equipment                                             75,503,130         65,773,454
Less accumulated depreciation                                             18,133,974         14,926,752
                                                                   ----------------------------------------
                                                                          57,369,156         50,846,702

Deferred financing costs, net                                              5,067,512          5,947,957
Goodwill, net                                                             88,643,881         90,415,806
Other assets                                                               1,661,805          1,084,794
                                                                   ----------------------------------------
Total assets                                                            $211,603,562       $196,336,028
                                                                   ========================================

LIABILITIES AND STOCKHOLDER'S EQUITY
Current liabilities:
   Accounts payable and accrued expenses                                $ 34,381,426       $ 21,229,049
   Current portion of long-term debt                                       6,409,654         11,442,812
                                                                   ----------------------------------------
Total current liabilities                                               $ 40,791,080         32,671,861

Deferred income taxes                                                      7,195,509          6,071,206

Long-term debt, less current portion                                     131,020,501        141,104,851

Stockholder's equity:
   Common stock, $.01 par value; 10,000 shares authorized; 1,000
     shares issued and outstanding                                                10                 10
   Additional paid-in capital                                             86,852,686         88,446,216
   Less stock notes receivable                                            (2,591,986)        (2,341,000)
   Predecessor basis adjustment                                          (11,031,662)       (11,031,662)
   Accumulated other comprehensive loss - foreign currency
     translation adjustment                                                 (159,081)          (549,888)
   Retained earnings (deficit)                                           (40,473,495)       (58,035,566)
                                                                   ----------------------------------------
Total stockholder's equity                                                32,596,472         16,488,110
                                                                   ----------------------------------------
Total liabilities and stockholder's equity                              $211,603,562       $196,336,028
                                                                   ========================================
</TABLE>

Note:    The balance sheet at December 30, 2000 has been derived from the
         audited financial statements at that date but does not include all the
         information and footnotes required by generally accepted accounting
         principles for complete financial statements.

See accompanying notes.
<PAGE>

                              Omega Cabinets, Ltd.

             Condensed Consolidated Statements of Income (Unaudited)
<TABLE>
<CAPTION>

                                          THREE MONTHS ENDED                     NINE MONTHS ENDED
                                    SEPTEMBER 29      SEPTEMBER 30         SEPTEMBER 29     SEPTEMBER 30
                                         2001             2000                 2001            2000
                                  ------------------------------------ ------------------------------------
<S>                                   <C>              <C>                 <C>              <C>
Net sales                            $ 85,159,815     $ 79,015,534         $246,027,532     $232,149,338
Cost of goods sold                     60,306,034       55,226,896          174,263,749      167,081,285
                                  ------------------------------------ ------------------------------------
Gross profit                         $ 24,853,781     $ 23,788,638         $ 71,763,783     $ 65,068,053

Selling, general and
   administrative expenses              9,479,131        9,345,813           28,321,705       30,087,146
Amortization of goodwill                  630,825          641,751            1,895,196        1,930,692
                                  ------------------------------------ ------------------------------------
Operating income                       14,743,825       13,801,074           41,546,882       33,050,215

Interest expense                        3,656,419        4,351,046           11,461,288       13,204,121
Foreign currency transaction
   losses                                 580,859          296,852              889,124          810,517
                                  ------------------------------------ ------------------------------------
Income before income taxes             10,506,547        9,153,176           29,196,470       19,035,577

Income tax expense                      4,160,324        3,586,172           11,636,297        7,481,139
                                  ------------------------------------ ------------------------------------
Net income                           $  6,346,223     $  5,567,004         $ 17,560,173     $ 11,554,438
                                  ==================================== ====================================
</TABLE>

See accompanying notes.
<PAGE>

                              Omega Cabinets, Ltd.

           Condensed Consolidated Statements of Cash Flows (Unaudited)

<TABLE>
<CAPTION>
                                                                              NINE MONTHS ENDED
                                                                       SEPTEMBER 29       SEPTEMBER 30
                                                                           2001               2000
                                                                    ---------------------------------------
<S>                                                                      <C>                <C>
OPERATING ACTIVITIES
Net income                                                              $ 17,560,173       $ 11,554,438
Adjustments to reconcile net income to net cash provided by
   operating activities:
     Depreciation and amortization                                         6,383,287          5,924,275
     Loss on disposal of fixed assets (Note 3)                                     -          2,468,546
     Noncash interest income on stock notes receivable                      (103,215)           (85,002)
     Deferred income taxes                                                 1,200,000          1,191,344
     Changes in operating assets and liabilities:
       Accounts receivable                                                (9,163,164)        (9,633,915)
       Inventories                                                        (1,003,879)          (547,515)
       Other assets                                                         (795,131)          (116,019)
       Accounts payable, accrued expenses and other liabilities
                                                                          13,586,560          7,501,556
                                                                    ---------------------------------------
Net cash provided by operating activities                                 27,664,631         18,257,708

INVESTING ACTIVITIES
Purchases of property, plant and equipment                               (11,033,599)        (7,921,528)
                                                                    ---------------------------------------
Net cash used in investing activities                                    (11,033,599)        (7,921,528)

FINANCING ACTIVITIES
Payments of long-term debt                                               (19,074,073)        (9,739,744)
Proceeds from long-term debt                                               5,498,018                  -
Capital contributions by parent                                              126,130            132,805
Payment to parent to redeem common stock and
   options at parent level                                                (1,898,945)           (81,135)
Proceeds from stock notes  receivable                                         31,529                  -
                                                                    ---------------------------------------
Net cash used in financing activities                                    (15,317,341)        (9,688,074)

Effect of foreign exchange rate changes on cash                              (48,013)           (70,833)
                                                                    ---------------------------------------
Net increase in cash                                                       1,265,678            577,273

Cash at beginning of period                                                2,982,601          2,234,669
                                                                    ---------------------------------------
Cash at end of period                                                   $  4,248,279       $  2,811,942
                                                                    =======================================

</TABLE>

See accompanying notes.
<PAGE>

                              Omega Cabinets, Ltd.

                         Notes to Condensed Consolidated
                        Financial Statements (Unaudited)

                               September 29, 2001

1. ACCOUNTING POLICIES

BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Article 10 of Regulation S-X.
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles for complete financial statements.
In the opinion of management, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been included.
Operating results for the three and nine month periods ended September 29, 2001
and September 30, 2000 are not necessarily indicative of the results that may be
expected for the full 2001 fiscal year. For further information, refer to the
Company's consolidated financial statements and footnotes thereto for the year
ended December 30, 2000.

NEW ACCOUNTING STANDARDS

In June 2001, the Financial Accounting Standards Board issued Statements of
Financial Accounting Standards No. 141, Business Combinations, and No. 142,
Goodwill and Other Intangible Assets, effective for fiscal years beginning after
December 15, 2001. Under the new rules, goodwill will no longer be amortized but
will be subject to annual impairment tests in accordance with the Statements.

The Company will apply the new rules beginning in the first quarter of 2002.
Applying the nonamortization provisions of the Statements will result in an
increase in pretax income to the extent of goodwill amortization which is no
longer recorded. The Company's historical amortization expense was approximately
$2.6 million in fiscal year 2000 and $1.9 million in the nine months ended
September 29, 2001. During 2002, the Company will perform the first of the
required impairment tests of goodwill and has not yet determined what the
effect, if any, will be on the earnings or financial position of the Company.
<PAGE>

                              Omega Cabinets, Ltd.

                         Notes to Condensed Consolidated
                        Financial Statements (Unaudited)

                               September 29, 2001



2. INVENTORIES

Inventories consist of the following:

<TABLE>
<CAPTION>
                                                                       SEPTEMBER 29        DECEMBER 30
                                                                           2001               2000
                                                                   ----------------------------------------

<S>                                                                     <C>                 <C>
   Raw materials                                                         $ 7,869,104         $ 7,510,552
   Work-in-process                                                         6,398,835           6,720,423
   Finished goods                                                          4,081,411           3,374,389
                                                                   ----------------------------------------
                                                                         $18,349,350         $17,605,364
                                                                   ========================================
</TABLE>

3. WRITE-OFF OF FIXED ASSETS

In June 2000, the Company terminated implementation of a new enterprise resource
and planning (ERP) system. The Company charged approximately $2.4 million to
selling, general, and administrative expense in the second quarter of fiscal
2000 related to the terminated implementation.

4. COMPREHENSIVE INCOME

Comprehensive income was $6,496,469 and $5,801,237 for the three months ended
September 29, 2001 and September 30, 2000, respectively, and $17,950,980 and
$12,328,770 for the nine months ended September 29, 2001 and September 30, 2000,
respectively.

5. GUARANTOR AND NON-GUARANTOR SUBSIDIARIES

The Company's $100 million senior subordinated notes are fully and
unconditionally guaranteed by Panther Transport, Inc. (Panther), a wholly owned
subsidiary of the Company. Separate financial statements or summarized financial
information for Panther have not been presented since its operations are
inconsequential and its accounts and transactions represent less than 1% of each
of the consolidated total assets, liabilities, equity, net sales, operating
income, and net income of the Company. Management believes that the separate
financial statements and summarized financial information of Panther are not
material to investors.
<PAGE>
                              Omega Cabinets, Ltd.

                         Notes to Condensed Consolidated
                        Financial Statements (Unaudited)

                               September 29, 2001


5. GUARANTOR AND NON-GUARANTOR SUBSIDIARIES (CONTINUED)

The Company also has two wholly owned subsidiaries which do not guarantee the
senior subordinated notes. These non-guarantor subsidiaries generally comprise
the Kitchen Craft of Canada, Ltd. (Kitchen Craft) business. Set forth below are
consolidating condensed financial statements as of September 29, 2001 and for
the three and nine months ended September 29, 2001 and September 30, 2000, which
separately reflect Kitchen Craft (amounts in thousands):

<TABLE>
<CAPTION>
                                                 THE           KITCHEN
                                               COMPANY*         CRAFT       ELIMINATIONS    CONSOLIDATED
                                            ---------------------------------------------------------------

                                        CONDENSED CONSOLIDATING BALANCE SHEET
                                                  SEPTEMBER 29, 2001
<S>                                           <C>              <C>        <C>               <C>
   Current assets:
     Cash                                       $     945     $   3,303      $       -      $    4,248
     Accounts receivable                           20,464        11,099              -          31,563
     Inventories                                   13,044         5,305              -          18,349
     Other                                          3,924           777              -           4,701
                                            ---------------------------------------------------------------
   Total current assets                            38,377        20,484              -          58,861
   Property, plant and equipment, net              38,053        19,316              -          57,369
   Goodwill, net                                   47,999        40,645              -          88,644
   Other noncurrent assets                         41,397           262        (34,930)          6,729
                                            ---------------------------------------------------------------
   Total assets                                 $ 165,826     $  80,707      $ (34,930)     $  211,603
                                            ===============================================================

   Current liabilities:
     Accounts payable and accrued expenses      $  24,939     $  13,673      $  (4,231)     $   34,381
     Current portion of long-term debt              5,169         1,241              -           6,410
                                            ---------------------------------------------------------------
   Total current liabilities                       30,108        14,914         (4,231)         40,791
   Long-term debt, less current portion           125,168        22,980        (17,128)        131,020
   Other noncurrent liabilities                     5,721         1,475              -           7,196
   Total stockholder's equity (deficit)             4,829        41,338        (13,571)         32,596
                                            ---------------------------------------------------------------
   Total liabilities and stockholder's
     equity (deficit)                           $ 165,826     $  80,707      $ (34,930)     $  211,603
                                            ===============================================================
</TABLE>

   *Includes Panther which is inconsequential as described above.
<PAGE>
                              Omega Cabinets, Ltd.

                         Notes to Condensed Consolidated
                        Financial Statements (Unaudited)

                               September 29, 2001


5. GUARANTOR AND NON-GUARANTOR SUBSIDIARIES (CONTINUED)

<TABLE>
<CAPTION>
                                                  THE          KITCHEN
                                                COMPANY         CRAFT       ELIMINATIONS    CONSOLIDATED
                                            ---------------------------------------------------------------

                               CONDENSED CONSOLIDATING STATEMENT OF INCOME
                                  THREE MONTHS ENDED SEPTEMBER 29, 2001
<S>                                              <C>            <C>            <C>              <C>
   Net sales                                     $55,377        $29,783        $  -             $85,160
   Cost of goods sold                             40,148         20,158           -              60,306
                                            ---------------------------------------------------------------
   Gross profit                                   15,229          9,625           -              24,854
   Selling, general and administrative
     expenses                                      6,439          3,671           -              10,110
   Interest expense                                3,259            397           -               3,656
   Foreign currency transaction gains                  -            582           -                 582
                                            ---------------------------------------------------------------
   Income before income taxes                      5,531          4,975           -              10,506
   Income tax expense                              2,178          1,982           -               4,160
                                            ---------------------------------------------------------------
   Net income                                    $ 3,353        $ 2,993        $  -             $ 6,346
                                            ===============================================================
<CAPTION>

                               CONDENSED CONSOLIDATING STATEMENT OF INCOME
                                  THREE MONTHS ENDED SEPTEMBER 30, 2000

<S>                                              <C>            <C>            <C>             <C>
   Net sales                                     $51,378        $27,638        $  -            $79,016
   Cost of goods sold                             37,105         18,122           -             55,227
                                            ---------------------------------------------------------------
   Gross profit                                   14,273          9,516           -             23,789
   Selling, general and administrative
     expenses                                      6,381          3,607           -              9,988
   Interest expense                                3,475            876           -              4,351
   Foreign currency transaction losses                 -            297           -                297
                                            ---------------------------------------------------------------
   Income before income taxes                      4,417          4,736           -              9,153
   Income tax expense                              1,698          1,888           -              3,586
                                            ---------------------------------------------------------------
   Net income                                    $ 2,719        $ 2,848        $  -            $ 5,567
                                            ===============================================================
<CAPTION>

                               CONDENSED CONSOLIDATING STATEMENT OF INCOME
                                  NINE MONTHS ENDED SEPTEMBER 29, 2001

<S>                                             <C>             <C>            <C>             <C>
   Net sales                                    $162,067        $83,961        $  -            $246,028
   Cost of goods sold                            118,003         56,261           -             174,264
                                            ---------------------------------------------------------------
   Gross profit                                   44,064         27,700           -              71,764
   Selling, general and administrative
     expenses                                     19,587         10,630           -              30,217
   Interest expense                                9,865          1,596           -              11,461
   Foreign currency transaction losses                 -            890           -                 890
                                            ---------------------------------------------------------------
   Income before income taxes                     14,612         14,584           -              29,196
   Income tax expense                              5,811          5,825           -              11,636
                                            ---------------------------------------------------------------
   Net income                                   $  8,801        $ 8,759        $  -            $ 17,560
                                            ===============================================================


</TABLE>
<PAGE>
                              Omega Cabinets, Ltd.

                         Notes to Condensed Consolidated
                        Financial Statements (Unaudited)

                               September 29, 2001


5. GUARANTOR AND NON-GUARANTOR SUBSIDIARIES (CONTINUED)

<TABLE>
<CAPTION>

                                                     THE          KITCHEN
                                                   COMPANY         CRAFT      ELIMINATIONS    CONSOLIDATED
                                               --------------------------------------------------------------

                               CONDENSED CONSOLIDATING STATEMENT OF INCOME
                                  NINE MONTHS ENDED SEPTEMBER 30, 2000

<S>                                                <C>             <C>             <C>           <C>
   Net sales                                       $154,258        $77,891         $  -          $232,149
   Cost of goods sold                               115,702         51,379            -           167,081
                                               --------------------------------------------------------------
   Gross profit                                      38,556         26,512            -            65,068
   Selling, general and administrative               21,292         10,726            -            32,018
     expenses
   Interest expense                                  10,708          2,496            -            13,204
   Foreign currency transaction losses                    -            811            -               811
                                               --------------------------------------------------------------
   Income before income taxes                         6,556         12,479            -            19,035
   Income tax expense                                 2,497          4,984            -             7,481
                                               --------------------------------------------------------------
   Net income                                      $  4,059        $ 7,495         $  -          $ 11,554
                                               ==============================================================
<CAPTION>

                               CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
                                    NINE MONTHS ENDED SEPTEMBER 29, 2001

<S>                                                 <C>            <C>             <C>            <C>
   Operating activities - net cash provided
     by operating activities                       $ 17,067        $10,598         $  -          $ 27,665

   Investing activities - purchase of
     property, plant and equipment                   (5,461)        (5,573)           -           (11,034)

   Financing activities:
     Payments of long-term debt                     (17,465)        (1,609)           -           (19,074)
     Proceeds from long-term debt                     5,498              -            -             5,498
     Redemptions of stock, net of capital
       contributions                                 (1,774)             -            -            (1,774)
     Proceeds from stock notes receivable                32              -            -                32
     Intercompany funding                             2,033         (2,033)           -                 -
                                               --------------------------------------------------------------
   Net cash used in financing activities            (11,676)        (3,642)           -           (15,318)
   Effect of foreign exchange                             -            (48)           -               (48)
                                               --------------------------------------------------------------
   Net increase (decrease) in cash                      (70)         1,335            -             1,265

   Cash at beginning of period                        1,015          1,968            -             2,983
                                               --------------------------------------------------------------
   Cash at end of period                           $    945        $ 3,303         $  -          $  4,248
                                               ==============================================================


</TABLE>
<PAGE>
                              Omega Cabinets, Ltd.

                         Notes to Condensed Consolidated
                        Financial Statements (Unaudited)

                               September 29, 2001


5. GUARANTOR AND NON-GUARANTOR SUBSIDIARIES (CONTINUED)

<TABLE>
<CAPTION>

                                                     THE          KITCHEN
                                                   COMPANY         CRAFT      ELIMINATIONS    CONSOLIDATED
                                               --------------------------------------------------------------

                                  CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
                                       NINE MONTHS ENDED SEPTEMBER 30, 2000

<S>                                                 <C>             <C>            <C>            <C>
   Operating activities - net cash provided
     by operating activities                        $11,438        $ 6,820         $  -           $18,258

   Investing activities - purchase of
     property, plant and equipment                   (4,610)        (3,312)           -            (7,922)

   Financing activities:
     Capital contributions, net of redemptions           52              -            -                52
     Intercompany funding                             1,335         (1,335)           -                 -
     Payments of long-term debt                      (9,435)          (305)           -            (9,740)
                                               --------------------------------------------------------------
   Net cash used in financing activities             (8,048         (1,640)           -            (9,688)
   Effect of foreign exchange                             -            (71)           -               (71)
                                               --------------------------------------------------------------
   Net increase (decrease) in cash                   (1,220)         1,797            -               577

   Cash at beginning of period                        1,496            739            -             2,235
                                               --------------------------------------------------------------
   Cash at end of period                            $   276        $ 2,536         $  -           $ 2,812
                                               ==============================================================

</TABLE>

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

GENERAL

The following discussion should be read in conjunction with the accompanying
Condensed Consolidated Financial Statements for the period ended September 29,
2001 and the Company's audited consolidated financial statements and Annual
Report on Form 10-K for the year ending December 30, 2000.

RESULTS OF OPERATIONS

NET SALES for the three months ended September 29, 2001 ("third quarter 2001")
were $85.2 million compared to $79.0 million for the three months ended
September 30, 2000 ("third quarter 2000"), an increase of 7.8%. For the first
nine months of 2001, net sales were $246.0 million compared to $232.1 million
for the first nine months of 2000, an increase of 6.0%. The increase in net
sales in the third quarter and first nine months of 2001 was primarily
attributable to strong new home construction and the impact of new products and
selling locations partly offset by discontinued low-margin product lines and
accounts. Net sales for the Kitchen Craft division were $29.8 million in the
third quarter 2001 compared with $27.6 million for the third quarter 2000, a
7.8% increase. Net sales for the first nine months of 2001 for Kitchen Craft
were $84.0 million, an increase of 7.8% compared with the first nine months of
2000 driven primarily by strong demand in the new home and multi-unit market.
Net sales for the Omega lines (custom and semi-custom cabinetry and bath
vanities) were
<PAGE>

$26.1 million in the third quarter 2001 compared with $25.0 million for third
quarter 2000, a 4.4% increase. Net sales for the first nine months of 2001 for
the Omega lines were $77.9 million, an increase of 5.1% compared with the first
nine months of 2000. Sales for the first nine months of 2001 increased 10% for
Omega's semi-custom products and 6% for Omega's bath line driven by new products
and selling locations. Omega's custom cabinetry sales declined 9% driven by soft
demand in the luxury remodel market. Net sales for HomeCrest's stock product
lines were $29.3 million in the third quarter 2001 compared with $26.4 million
for the third quarter 2000, a 11.0% increase. Net sales for the first nine
months of 2001 for the HomeCrest lines were $84.2 million, an increase of 5.1%
compared with the first nine months of 2000. The increase in HomeCrest sales
growth is primarily due to new products and selling locations as well as
continued strength in the new home construction market.

GROSS PROFIT for third quarter 2001 was $24.9 million compared to $23.8 million
for third quarter 2000, an increase of 4.5%. As a percentage of net sales, gross
profit declined to 29.2% in third quarter 2001 from 30.1% in third quarter 2000.
For the first nine months of 2001, gross profit was $71.8 million compared to
$65.1 million for the first nine months of 2000, an increase of 10.3%. As a
percentage of net sales, gross profit improved to 29.2% for the first nine
months of 2001 from 28.0% for the first nine months of 2000. This improvement
was driven primarily by improved factory execution at every division and the
impact of various capital and Company-wide cost reduction projects.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES for the third quarter 2001 were
$9.5 million compared to $9.3 million for the third quarter 2000, an increase of
1.4%. As a percentage of net sales, selling, general and administrative expenses
were 11.1% for the third quarter 2001 compared to 11.8% for the third quarter
2000. For the first nine months of 2001, expenses were $28.3 million compared to
$30.1 million for the first nine months of 2000, a decrease of 5.9%. The first
nine months of 2000 included a non-recurring charge of $2.4 million related to a
failed software implementation. Excluding this charge, expenses increased 2.3%
compared to the first nine months of 2000 and as a percentage of net sales,
expenses were 11.1% compared to 11.9% for the first nine months of 2000.

INTEREST EXPENSE for third quarter 2001 was $3.7 million compared to $4.4
million for third quarter 2000, a 16.0% decrease driven by lower average
borrowings and interest rates. For the first nine months of 2001, interest
expense was $11.5 million compared to $13.2 million for the first nine months of
2000, a decrease of 13.2%.

INCOME TAXES for third quarter 2001 were $4.2 million, compared to $3.6 million
for third quarter 2000. Third quarter 2001 reflected a normalized tax rate of
39.6% compared to 39.2% in third quarter 2000 resulting from a higher effective
state tax rate for the U.S. divisions. First nine months of 2001 income taxes
were $11.6 million, compared to $7.5 million for the first nine months of 2000.
First nine months of 2001 reflected a normalized tax rate of 39.9%, compared
with 39.3% for the first nine months of 2000.

NET INCOME for third quarter 2001 was $6.3 million compared to $5.6 million for
third quarter 2000, a 14.0% increase related to factors discussed above. For the
first nine months of 2001, net income was $17.6 million, compared to $11.6
million for the first nine months of 2000, a 52.0% increase.

To provide more insight into the underlying performance of the consolidated
group, a summary for third quarter 2001, third quarter 2000, the twelve months
ended September 29, 2001 and the twelve months ended September 30, 2000 are
shown below:
<PAGE>

<TABLE>
<CAPTION>

                                            Third Quarter                                Twelve Months Ended
                                            -------------                                -------------------
                                        2001             2000          Increase        9/29/01         9/30/00
                                        ----             ----          --------        -------         -------
<S>                                    <C>              <C>              <C>            <C>              <C>
($ in millions)
Net Sales:
Omega/HomeCrest                        $55.4            $51.4            7.8%           $208.1           $197.5
Kitchen Craft                           29.8             27.6            7.8%            109.9            101.0
                                       -----           ------                            -----         --------
Consolidated                           $85.2            $79.0            7.8%           $318.1           $298.5

Adjusted EBITDA (1):
Omega/HomeCrest                        $10.1            $ 9.4            6.8%           $ 36.5           $ 29.5
Kitchen Craft                            6.6              6.5            2.3%             25.3             22.9
                                       -----           ------                            -----         --------
Consolidated                           $16.7            $15.9            5.0%           $ 61.8           $ 52.5

Adjusted EBITDA Margin (2):
Omega/HomeCrest                         18.2%            18.3%                            17.6%           14.9%
Kitchen Craft                           22.3%            23.5%                            23.0%           22.7%
Consolidated                            19.6%            20.1%                            19.4%           17.6%

</TABLE>

--------

(1)  Adjusted EBITDA represents EBITDA, as defined below, adjusted for certain
     unusual, one-time or nonrecurring expenses. During third quarter 2001, the
     net adjustment to EBITDA was $25,115. During third quarter 2000, the net
     adjustment to EBITDA was $353,855 related primarily to executive severance
     costs. EBITDA represents income from operations before interest expense
     (including amortization of deferred financing costs), income taxes,
     depreciation, amortization of goodwill, non-cash stock option and warrant
     expense and certain unusual or nonrecurring expenses. EBITDA is presented
     because it is a widely accepted financial indicator of a leveraged
     company's ability to service and/or incur indebtedness and because
     management believes that EBITDA is a relevant measure of the Company's
     ability to generate cash without regard to the Company's capital structure
     or working capital needs. EBITDA as presented may not be comparable to
     similarly titled measures used by other companies, depending upon the
     non-cash charges included. When evaluating EBITDA investors should consider
     that EBITDA (i) should not be considered in isolation but together with
     other factors which may influence operating and investing activities, such
     as changes in operating assets and liabilities and purchase of property and
     equipment, (ii) is not measure of performance calculated in accordance with
     generally accepted accounting principles, (iii) should not be construed as
     an alternative or substitute for income from operations, net income or cash
     flows from operating activities in analyzing the Company's operating
     performance, financial position or cash flows and (iv) should not be used
     as an indicator of the Company's operating performance or as a measure of
     its liquidity.

(2)  Adjusted EBITDA Margin represents Adjusted EBITDA as a percentage of
     net sales.

LIQUIDITY AND CAPITAL RESOURCES

The Company's primary cash needs are working capital, capital expenditures and
debt service. The Company has financed these cash requirements primarily through
internally generated cash flow and funds borrowed under the Company's credit
facilities.

Net cash provided by operating activities for the first nine months of 2001 was
$27.7 million compared to $18.3 million for first nine months of 2000. The
increase of $9.4 million was driven primarily by $6.0 million higher net income
and a $2.6 million decline in operating assets and liabilities compared with a
$2.8 million increase during the first nine months of 2000.

The Company used cash in investing activities of $11.0 million for the first
nine months of 2001 compared to $7.9 million for the first nine months of 2000,
an increase of $3.1 million. Major capital expenditures for the
<PAGE>

first nine months of 2001 included a 200,000 square foot capacity expansion
project at Kitchen Craft's Winnipeg facility and productivity projects at
HomeCrest's Goshen, IN facility.

Cash used in financing activities was $15.3 million for the first nine months of
2001 compared to cash used of $9.7 million for the first nine months of 2000.
This change of $5.6 million was due to $3.8 million for lower borrowings and
$1.8 million for various stockholder equity redemptions.

The Company's ability to make scheduled payments of principal of, or to pay the
interest or premium, if any, on, or to refinance, its indebtedness, or to fund
planned capital expenditures will depend on its future performance, which, to a
certain extent, is subject to general economic, financial, competitive,
legislative, regulatory and other factors that are beyond its control. Based
upon the current level of operations, management believes that cash flow from
operations and available cash, together with available borrowings under its bank
loans, will be adequate to meet the Company's anticipated future requirements
for working capital, budgeted capital expenditures and scheduled payments of
principal and interest on its indebtedness for the next several years. There can
be no assurance that the Company's business will generate sufficient cash flow
from operations or that future borrowing will be available under its bank loans
in an amount sufficient to enable the Company to service its indebtedness or
make anticipated capital expenditures.

At September 29, 2001, the Company's long-term debt consisted of (i) the $100.0
million of senior subordinated notes; (ii) a U.S. senior credit facility,
consisting of a $30.3 million term note facility (the "U.S. Term Facility") and
a $20.0 million revolving facility (the "U.S. Revolving Facility"); and (iii) a
Canadian senior credit facility, consisting of a (Cdn) $11.2 million term
facility (the "Canadian Term Facility") and a (Cdn) $15.0 million revolving
facility (the "Canadian Revolving Facility").

As of September 29, 2001, the Company had no borrowings under the U.S. or
Canadian Revolving Facilities. In addition, the Company had cash of $4.2 million
that was available to further reduce long-term debt. The U.S. Term Facility
requires quarterly principal payments that began in April 1999 at $1.0 million
per quarter and increase at each September anniversary. Subsequent payments will
be approximately $1.2 million and $1.5 million per quarter during the four
quarter periods beginning September 2001 and 2002, respectively, with $1.8
million payments due the last two quarters of 2003. Finally, four equal
quarterly payments of $4.3 million will occur during 2004 with the term loan
fully amortized on December 31, 2004. Additional payments are also due each year
based on 75% of the Company's defined excess cash flow, if any. As a result of
this requirement, a mandatory $4.1 million excess cash flow payment was made
during March 2001 and a voluntary $5.0 million payment was made during September
2001. The Canadian Term Facility requires quarterly payments that began in April
1999 at approximately (Cdn) $0.4 million per quarter and increase at each
anniversary. Subsequent payments will be approximately (Cdn) $0.4 million, (Cdn)
$0.5 million, (Cdn) $0.6 million and (Cdn) $1.6 million per quarter during 2001,
2002, 2003, and 2004. Both the U.S. and Canadian Term Facilities mature on
December 31, 2004. Revolving Facilities mature on December 26, 2003 and have no
scheduled interim amortization.

NEW ACCOUNTING STANDARDS

In June 2001, the Financial Accounting Standards Board issued Statements of
Financial Accounting Standards No. 141, Business Combinations, and No. 142,
Goodwill and Other Intangible Assets, effective for fiscal years beginning after
December 15, 2001. Under the new rules, goodwill will no longer be amortized but
will be subject to annual impairment tests in accordance with the Statements.

The Company will apply the new rules beginning in the first quarter of 2002.
Applying the nonamortization provisions of the Statements will result in an
increase in pretax income to the extent of goodwill amortization which is no
longer recorded. The Company's historical amortization expense was approximately
$2.6 million in fiscal year 2000 and $1.9 million in the nine months ended
September 29, 2001. During 2002, the
<PAGE>

Company will perform the first of the required impairment tests of goodwill and
has not yet determined what the effect, if any, will be on the earnings or
financial position of the Company.

FORWARD LOOKING STATEMENTS

When used in this quarterly report on Form 10-Q, the words "believes,"
"anticipates" and similar expressions are used to identify forward looking
statements. Such statements are subject to risks and uncertainties which could
cause actual results to differ materially from those projected. The Company
wishes to caution readers that the following important factors and others in
some cases have affected and in the future could affect the Company's actual
results and could cause the Company's results for future periods to differ
materially from those expressed in any forward statements made by the Company:
(i) inability to hire and retain adequately trained employees, (ii) economic
conditions in the remodeling and housing markets, (iii) availability of credit,
(iv) increases in interest rates, (v) cost of lumber and other raw materials,
(vi) inability to maintain state-of-the-art manufacturing facilities, (vii)
heightened competition, including intensification of price and service
competition, the entry of new competitors and the introduction of new products
by existing competitors, (viii) inability to capitalize on opportunities
presented by industry consolidation, (ix) loss or retirement of key executives
and (x) inability to grow by acquisition of additional cabinetry manufactures or
to effectively consolidate operations of businesses acquired.


ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

The Company is subject to interest rate market risk in connection with its
long-term debt. These financial instruments are entered into for purposes other
than trading. As of September 29, 2001, the Company's debt instruments consisted
of certain obligations which bear a fixed interest rate and others which bear
interest at variable rates. The following table provides information about the
Company's debt instruments that are sensitive to changes in interest rates, and
presents the principal cash flows and related interest rates by scheduled
maturity dates (in thousands):

                                           Variable Rate (a)      Fixed Rate (b)

     Maturing in:
               2001                              $ 1,496                     --
               2002                                6,715                     --
               2003                                8,146                     --
               2004                               21,073                     --
               Thereafter                             --                100,000
                                                 -------
               Total                             $37,430               $100,000
                                                 =======               ========

     Fair value at September 29, 2001            $37,430               $102,500

(a)      $13.2 million at LIBOR plus 1.25%, $17.1 million at LIBOR plus 1.50%
         and $7.1 million at Canadian BA rate plus 1.50%, (7.01% weighted
         average at September 29, 2001).

(b)      All at 10.5%.

The Company's interest expense is most sensitive to changes in the general level
of U.S. and certain foreign (LIBOR and Canadian BA) interest rates. In this
regard, changes in such interest rates affect the interest paid on certain of
its debt. To manage the impact of fluctuations in interest rates, the Company
continually monitors and may select a variety of rate options on its
variable-rate debt. In addition, the Company has maintained a majority of its
debt borrowings as fixed-rate debt. During December 2000 the Company entered
into a one year interest rate swap agreement at 6.11% LIBOR rate on
approximately $42.0 million for the first three months, $35.0 million for the
second three months, $33.0 million for the third three months, and $30.0 million
for the final three months.

<PAGE>

                            PART II OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS.

         The Company is a party to various legal actions arising in the ordinary
course of its business. The Company believes that the resolution of these legal
actions will not have a material adverse effect on the Company's financial
position or results of operations.

ITEM 2.   CHANGES IN SECURITIES AND USE OF PROCEEDS.

None.

ITEM 3.   DEFAULTS UPON SENIOR SECURITIES.

None.

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

None.

ITEM 5.   OTHER INFORMATION.

None.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K.

None


<PAGE>

         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.


                                      OMEGA CABINETS, LTD.

                                     By: /s/ JOHN HORTON
                                        ------------------------------
                                     Name:  John S. Horton
                                     Title:    Chief Financial Officer
                                                   (Authorized signatory and
                                                   principal financial officer)


Dated:  November 9, 2001