<PAGE>   1

================================================================================
                                  UNITED STATES
                       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 QUARTER ENDED
                               SEPTEMBER 30, 1998


                                       OR


           [ X ] 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: 0-20278


                             ENCORE WIRE CORPORATION
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)



                DELAWARE                               75-2274963
        (State of incorporation)         (I.R.S. employer identification number)


           1410 MILLWOOD ROAD
             MCKINNEY, TEXAS                             75069
(Address of principal executive offices)              (Zip code)



       REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (972) 562-9473



Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.  Yes [ X ]  No [   ]


 Number of shares of Common Stock outstanding as of November 2, 1998: 16,304,148






================================================================================



<PAGE>   2


                                                                       FORM 10-Q




                             ENCORE WIRE CORPORATION

                                    FORM 10-Q

                    FOR THE QUARTER ENDED SEPTEMBER 30, 1998

<TABLE>
<CAPTION>

                                                                                                           Page No.
                                                                                                           --------
<S>      <C>      <C>                                                                                      <C>

PART I.           FINANCIAL INFORMATION

         ITEM 1.           Consolidated Financial Statements

                  Consolidated Balance Sheets.....................................................................3
                    September 30, 1998 (Unaudited) and December 31, 1997

                  Consolidated Statements of Income (Unaudited)...................................................5
                    Quarters and nine months ended September 30, 1998 and September
                    30, 1997

                  Consolidated Statements of Cash Flows (Unaudited)...............................................6
                    Nine months ended September 30, 1998 and September 30, 1997

                  Notes to Consolidated Financial Statements......................................................7

         ITEM 2.           Management's Discussion and Analysis of Financial
                           Condition and Results of Operations...................................................10

PART II.          OTHER INFORMATION

         ITEM 1.           Legal Proceedings.....................................................................17

         ITEM 6.           Exhibits and Reports on Form 8-K......................................................18


Signatures.......................................................................................................19
</TABLE>

                                                                               2



<PAGE>   3


                                                                       FORM 10-Q





                          PART I. FINANCIAL INFORMATION


ITEM 1.  CONSOLIDATED FINANCIAL STATEMENTS


                             ENCORE WIRE CORPORATION

                           CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>

                                                              September 30,  December 31,
                                                                  1998          1997
In Thousands of Dollars                                        (Unaudited)   (See Note 1)
                                                               -----------   -----------
<S>                                                            <C>           <C>        
                                  ASSETS

Current assets:
         Cash ..............................................   $     1,098   $     1,165
         Accounts receivable (net of allowance of
             $637 and $675) ................................        60,740        44,302
         Inventories (Note 2) ..............................        31,925        30,597
         Prepaid expenses and other assets .................           375           159
         Deferred income taxes .............................           793           793
                                                               -----------   -----------
             Total current assets ..........................        94,931        77,016


Property, plant and equipment-on the basis of cost:
         Land ..............................................         3,568         1,747
         Buildings and improvements ........................        22,991        19,258
         Construction in Progress ..........................        12,492         8,793
         Machinery and equipment ...........................        52,071        35,498
         Furniture and fixtures ............................         1,142           829
                                                               -----------   -----------

             Total property, plant, and equipment ..........        92,264        66,125

             Accumulated depreciation and
                 amortization ..............................        18,891        14,797
                                                               -----------   -----------

                                                                    73,373        51,328

Other assets ...............................................           185           411
                                                               -----------   -----------

Total assets ...............................................   $   168,489   $   128,755
                                                               ===========   ===========

</TABLE>

                          See accompanying notes


                                                                               3

<PAGE>   4


                                                                       FORM 10-Q



                             ENCORE WIRE CORPORATION


                     CONSOLIDATED BALANCE SHEETS (continued)




<TABLE>
<CAPTION>


                                                                     September      December
                                                                     30, 1998        31,1997
In Thousands of Dollars, Except Share Data                          (Unaudited)    (See Note 1)
                                                                    -----------    -----------
<S>                                                                 <C>            <C>        
LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
         Trade accounts payable .................................   $    15,085    $    23,380
         Accrued liabilities ....................................         7,312          8,248
         Current income taxes payable ...........................         4,382          1,677
                                                                    -----------    -----------

         Total current liabilities ..............................        26,779         33,305

Non-current deferred income taxes ...............................         3,240          3,240
Long term notes payable .........................................        54,000         22,200

Stockholders' equity:
Common stock, $.01 par value:
         Authorized shares - 20,000,000
         Issued and outstanding shares - (16,304,148
                at September 30, 1998 and 16,197,577 at
                December 31, 1997) ..............................           163            162
Additional paid-in capital ......................................        30,369         29,956
Treasury stock - 502,575 at September 30, 1998 and 300,375 at
         December 31, 1997 ......................................        (4,467)        (1,608)
Retained earnings ...............................................        58,405         41,500
                                                                    -----------    -----------

         Total stockholders' equity .............................        84,470         70,010
                                                                    -----------    -----------

Total liabilities and stockholders' equity ......................   $   168,489    $   128,755
                                                                    ===========    ===========
</TABLE>


Note:    The consolidated balance sheet at December 31, 1997, as presented, is
         derived from the audited consolidated financial statements at that
         date.


                             See accompanying notes


                                                                               4

<PAGE>   5


                                                                       FORM 10-Q



                             ENCORE WIRE CORPORATION


                        CONSOLIDATED STATEMENTS OF INCOME
                                   (Unaudited)


<TABLE>
<CAPTION>

                                                           Quarter Ended          Nine Months Ended
                                                           September 30,            September 30,
                                                      ----------------------   -----------------------
In Thousands of Dollars, Except Per Share Data          1998         1997         1998         1997
                                                     ----------   ----------   ----------   ----------
<S>                                                  <C>          <C>          <C>          <C>       

   Net sales .....................................   $   69,557   $   70,728   $  196,390   $  192,747
   Cost of goods sold ............................       54,220       55,381      153,144      153,660
                                                     ----------   ----------   ----------   ----------

   Gross profit ..................................       15,337       15,347       43,246       39,087

   Selling, general, and administrative expense ..        4,992        4,487       14,062       12,178
                                                     ----------   ----------   ----------   ----------

   Operating income ..............................       10,345       10,860       29,184       26,909

   Interest expense (net) ........................          589          254        1,109        1,062
                                                     ----------   ----------   ----------   ----------

   Income before income taxes ....................        9,756       10,606       28,075       25,847

   Provision for income taxes ....................        3,854        4,285       11,170       10,210
                                                     ----------   ----------   ----------   ----------

   Net income ....................................   $    5,902   $    6,321   $   16,905   $   15,637
                                                     ==========   ==========   ==========   ==========

   Weighted average common and common
      equivalent shares - basic ..................       15,913       15,840       15,921       15,773
                                                     ==========   ==========   ==========   ==========

   Net income per common and common
      equivalent share - basic ...................   $      .37   $      .40   $     1.06   $      .99
                                                     ==========   ==========   ==========   ==========

   Weighted average common and common
      equivalent shares - diluted ................       16,336       16,615       16,499       16,541
                                                     ==========   ==========   ==========   ==========

   Net income per common and common
      equivalent share - diluted .................   $      .36   $      .38   $     1.02   $      .95
                                                     ==========   ==========   ==========   ==========

   Cash dividends declared per share .............   $       --   $       --   $       --   $       --
                                                     ==========   ==========   ==========   ==========
</TABLE>


                             See accompanying notes


                                                                               5

<PAGE>   6


                                                                       FORM 10-Q



                             ENCORE WIRE CORPORATION


                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)


<TABLE>
<CAPTION>

                                                                                 Nine Months Ended
                                                                                   September 30,

In Thousands of Dollars                                                          1998          1997
                                                                              ----------    ----------
<S>                                                                           <C>           <C>       
OPERATING ACTIVITIES
    Net income ............................................................   $   16,905    $   15,637
    Adjustments to reconcile net income to cash provided by
        (used in) operating activities:
            Depreciation and amortization .................................        4,137         2,955
            Provision for bad debts .......................................          500           341
            Loss on disposal of assets ....................................          (15)           --
            Changes in operating assets and liabilities:
                Accounts receivable .......................................      (16,938)      (20,396)
                Inventory .................................................       (1,328)        2,505
                Accounts payable and accrued liabilities ..................       (9,231)        6,492
                Other assets and liabilities ..............................         (216)          (51)
                Current income taxes payable ..............................        2,705           642
                                                                              ----------    ----------

                   NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES ....       (3,481)        8,125
                                                                              ----------    ----------

INVESTING ACTIVITIES
    Purchases of property, plant and equipment ............................      (26,179)      (15,141)
    Increase in Long Term Investments .....................................          226           (80)
    Proceeds from Sale of Equipment .......................................           12            16
                                                                              ----------    ----------

        NET CASH US VESTING ACTIVITIES ....................................      (25,941)      (15,205)
                                                                              ----------    ----------

FINANCING ACTIVITIES
    Borrowings (repayments) under notes payable ...........................       31,800         6,400
    Purchases of Treasury Stock ...........................................       (2,859)          (99)
    Proceeds from issuance of common stock ................................          414           652
                                                                              ----------    ----------

        NET CASH PROVIDED BY FINANCING ACTIVITIES .........................       29,355         6,953
                                                                              ----------    ----------

Net decrease in cash ......................................................          (67)         (127)
Cash at beginning of period ...............................................        1,165         1,261
                                                                              ----------    ----------
Cash at end of period .....................................................   $    1,098    $    1,134
                                                                              ==========    ==========
</TABLE>

                             See accompanying notes



                                                                               6

<PAGE>   7


                                                                       FORM 10-Q



                             ENCORE WIRE CORPORATION


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)


NOTE 1 - BASIS OF PRESENTATION

         The unaudited consolidated financial statements of Encore Wire
Corporation have been prepared in accordance with generally accepted accounting
principles for interim financial information and the instructions to Form 10-Q
and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting principles
for complete financial statements. In the opinion of management, all
adjustments, consisting only of normal recurring adjustments, considered
necessary for a fair presentation have been included. Results of operations for
the periods presented are not necessarily indicative of the results that may be
expected for the year ending December 31, 1998. These financial statements
should be read in conjunction with the audited financial statements and notes
thereto included in the Company's Annual Report on Form 10-K for the year ended
December 31, 1997.


NOTE 2 - INVENTORIES

         Inventories are stated at the lower of cost or market. Cost is
determined by the last-in, first-out (LIFO) method.

         Inventories (in thousands) consisted of the following:

<TABLE>
<CAPTION>

                                           September 30,    December 31,  
                                              1998             1997       
                                           ----------       ----------    
                                                                          
<S>                                        <C>              <C>           
Raw materials ..........................   $    6,638       $    2,299    
Work-in-process ........................        2,992            6,128    
Finished goods .........................       18,784           20,818    
                                           ----------       ----------    
                                                                          
                                               28,414           29,245    
                                                                          
Increase to LIFO cost ..................        5,674            2,629    
                                                                          
Lower of Cost or Market Adjustment .....       (2,163)          (1,277)   
                                           ----------       ----------    
                                                                          
                                           $   31,925       $   30,597    
                                           ==========       ==========    
</TABLE>


         An actual valuation of inventory under the LIFO method can be made only
at the end of each year based on the inventory levels and costs at that time.
Accordingly, interim LIFO calculations must necessarily be based on management's
estimates of expected year-end inventory levels and costs. Because these are
subject to many forces beyond management's control, interim results are subject
to the final year-end LIFO inventory valuation.


                                                                               7

<PAGE>   8


                                                                       FORM 10-Q



NOTE 3 - INCOME (LOSS) PER SHARE

         Income per common and common equivalent share is computed using the
weighted average number of shares of common stock and common stock equivalents
outstanding during each period. If dilutive, the effect of stock options,
treated as common stock equivalents, is calculated using the treasury stock
method.


The following table sets forth the computation of basic and diluted earnings per
share:

<TABLE>
<CAPTION>

                                                                  Quarter Ended       Quarter Ended
                                                               September 30, 1998   September 30, 1997
                                                               ------------------   ------------------
<S>                                                            <C>                  <C>               
Numerator:
         Net Income                                            $        5,902,000   $        6,321,000
                                                               ==================   ==================
Denominator:
         Denominator for basic earnings per share -
         weighted average shares                                       15,912,527           15,839,893
Effect of dilutive securities:
         Employee stock options                                           423,780              774,713
                                                               ------------------   ------------------
Denominator for diluted earnings per share -
         weighted average shares                                       16,336,307           16,614,606
                                                               ==================   ==================
</TABLE>


The following table sets forth the computation of basic and diluted earnings per
share:

<TABLE>
<CAPTION>

                                                               Nine Months Ended    Nine Months Ended
                                                               September 30, 1998   September 30, 1997
                                                               ------------------   ------------------
<S>                                                            <C>                  <C>               
Numerator:
         Net Income                                            $       16,905,000   $       15,637,000
                                                               ==================   ==================
Denominator:
         Denominator for basic earnings per share -
         weighted average shares                                       15,920,751           15,773,196
Effect of dilutive securities:
         Employee stock options                                           577,820              768,189
                                                               ------------------   ------------------
Denominator for diluted earnings per share -
         weighted average shares                                       16,498,571           16,541,385
                                                               ==================   ==================
</TABLE>




                                                                               8

<PAGE>   9


                                                                       FORM 10-Q



NOTE 4 - LONG TERM NOTE PAYABLE

         Effective June 9, 1997, the Company completed an unsecured loan
facility with a group of banks (the "Financing Agreement"). This Financing
Agreement has been amended four times since June 9, 1997 to change, among other
items, the maximum borrowing amount, the term of the loan covenants and the
allowable purchases of the Company's common stock. The Financing Agreement
provides for maximum borrowings of the lesser of $65.0 million or the amount of
eligible accounts receivable plus the amount of eligible finished goods and raw
materials, less any available reserves established by the banks. The calculated
maximum borrowing amount available at September 30, 1998, as computed under the
Financing Agreement, was $65.0 million. The Financing Agreement is unsecured and
contains customary covenants and events of default. The Company was in
compliance with these covenants, as amended, as of September 30, 1998. Pursuant
to the Financing Agreement, the Company is prohibited from declaring, paying or
issuing cash dividends. At September 30, 1998, the balance outstanding under the
Financing Agreement was $54.0 million. Amounts outstanding under the Financing
Agreement are payable on May 31, 2001 with interest due quarterly based on the
bank's prime rate or LIBOR Rate options, at the Company's election.

NOTE 5 - STOCK REPURCHASE AUTHORIZATION

         In March 1995, the Board of Directors authorized the Company to
purchase up to 900,000 shares, or approximately 5.6%, of its outstanding common
stock dependent upon market conditions. Purchases made pursuant to this
authorization are made in the open market or through privately negotiated
transactions. As of September 30, 1998, the Company had repurchased an aggregate
of 502,575 shares of its common stock in the open market at a weighted average
price of $8.89 per share. The Financing Agreement, as amended, discussed in note
4 allows the Company to purchase up to 900,000 shares with an aggregate price of
these shares not to exceed $11,300,000. The Company purchased 202,200 shares
under this authorization during the third quarter of 1998.

NOTE 6 - STOCK DIVIDENDS

         On July 22, 1997 the Board of Directors of the Company declared a
3-for-2 stock split to be paid as a 50% stock dividend on its common stock. The
stock dividend was payable August 18, 1997 to stockholders of record at the
close of business on August 11, 1997.

         On May 5, 1998 the Board of Directors of the Company declared a 3-for-2
stock split to be paid as a 50% stock dividend on its common stock. The stock
dividend was payable June 15, 1998 to stockholders of record at the close of
business on June 8, 1998.

The per share amounts disclosed in this filing have been restated to reflect
each of the foregoing stock dividends.



                                                                              9

<PAGE>   10


                                                                       FORM 10-Q



                     MANAGEMENTS DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS


GENERAL

         The Company is a low-cost manufacturer of copper electrical building
wire and cable. The Company is a significant supplier of residential wire for
interior wiring in homes, apartments and manufactured housing and commercial
wire for commercial and industrial buildings.

         Price competition for electrical wire and cable is intense, and the
Company sells its products in accordance with prevailing market prices. Copper
is the principal raw material used by the Company in manufacturing its products.
Copper accounted for approximately 73.8%, 77.4%, 76.8%, 67.9% and 70.0% of the
Company's cost of goods sold during fiscal 1997, 1996, 1995, 1994 and 1993,
respectively. The price of copper fluctuates, depending on general economic
conditions and in relation to supply and demand and other factors, and has
caused monthly variations in the cost of copper purchased by the Company. The
Company cannot predict copper prices in the future or the effect of fluctuations
in the cost of copper on the Company's future operating results.

         The following discussion and analysis relates to factors that have
affected the operating results of the Company for the three month and nine month
periods ended September 30, 1998 and 1997. Reference should also be made to the
audited financial statements and notes thereto included in the Company's Annual
Report on Form 10-K for the year ended December 31, 1997.

RESULTS OF OPERATIONS

Quarter Ended September 30, 1998 Compared to Quarter Ended September 30, 1997

         Net sales for the third quarter of 1998 amounted to $69.6 million
compared with net sales of $70.7 million for the third quarter of 1997. This
decrease was due to a decrease in the average sales price per copper pound of
the Company's products, offset in part by an increase of 20% in the pounds of
copper shipped during the period. The decrease in the average sales price per
copper pound of the Company's products was due to a decrease of 28% in the
average cost of copper from the third quarter of 1997 to the same period in
1998, as well as competitive pricing pressures for the Company's products. Sales
volume increased due to several factors, including increases in customer
acceptance and product availability. Sales volume, as measured in copper pounds,
of both the residential and commercial products increased during the third
quarter of 1998 compared to the third quarter of 1997. The average sales price
per copper pound of product sold was $1.58 in the third quarter of 1998,
compared to $1.93 in the third quarter of 1997. Fluctuations in sales prices are
primarily a result of price competition and changing copper raw material prices.

         Cost of goods sold was $54.2 million in the third quarter of 1998,
compared to $55.4 million in the third quarter of 1997. Copper costs decreased
to $35.7 million in the third quarter of 1998 from $44.0 million in the third
quarter of 1997. The average cost per copper pound purchased decreased to $.79
in the third quarter of 1998 from $1.09 in the third quarter of 1997. Copper
costs as a percentage of net sales decreased to 51.4% in the third quarter of
1998 from 62.3% in the third quarter of 1997. This decrease as a percentage of
net sales in the third quarter of 1998 from the comparable quarter in 1997 was
due primarily to lower copper cost per pound of product sold, partially offset
by a decreased

                                                                              10

<PAGE>   11


                                                                       FORM 10-Q



differential between what the Company pays per pound of copper purchased and the
Company's net sales price per copper pound. This differential decreased in the
third quarter of 1998 due to a lesser decrease in the average cost per copper
pound purchased than in the sales price per copper pound. The decreased
differential was a result of competitive pricing conditions. Other raw material
costs as a percentage of net sales increased to 13.0% in the third quarter of
1998, compared with 11.2% in the third quarter of 1997. This increase is due to
raw materials per pound of copper sold remaining relatively constant while the
sales price per copper pound of product sold decreased as discussed above.
Depreciation, labor and overhead costs as a percentage of net sales increased to
13.7% in the third quarter of 1998 from 9.0% in the third quarter of 1997. This
increase is due to an increase in depreciation, labor and overhead per pound of
copper sold relating to the Company's expansion projects as well as a lower
sales price per copper pound of product sold as discussed above.

         Inventories are stated at the lower of cost, determined by the last in,
first out (LIFO) method or market. As permitted by generally accepted accounting
principles, the Company maintains its inventory costs and cost of goods sold on
a first in, first out (FIFO) basis and makes a quarterly LIFO adjustment to
adjust total inventory and cost of goods sold to LIFO. The price of copper
decreased during the third quarter of 1998, necessitating a decrease in the LIFO
reserve of $995,000 that resulted in an increase to the inventory value and a
decrease in cost of goods sold. In the third quarter of 1997, the price of
copper decreased from the previous quarter, necessitating a decrease in the LIFO
reserve that resulted in an increase to the inventory value and a decrease to
the cost of goods sold by $2,956,000. At September 30, 1998, LIFO value exceeded
the market value of the inventory by $2,163,000. And an addition to the lower of
cost or market reserve in the amount of $886,000 was required. This adjustment
decreased the amount of the inventory and increased cost of goods sold. At
September 30, 1997, LIFO cost did not exceed the market value of the inventory
and no adjustment to lower the cost of inventory to market was necessary. Future
reductions in the price of copper could require the Company to record additional
lower of cost or market adjustments against the related inventory balance which
would result in a negative impact on net income. In addition, if the quantity of
inventory is reduced in any period, copper that is carried in inventory at a
cost different from the cost of copper in the period in which the reduction
occurs will be included in cost of goods sold at the different price.

         Gross profit remained relatively constant at $15.3 million, or 22.0% of
net sales, in the third quarter of 1998 compared to $15.3 million, or 21.7% of
net sales, for the third quarter of 1997.

         General and administrative expenses were $1.1 million, or 1.6% of net
sales, in the third quarter of 1998 compared to $887,000, or 1.3% of net sales,
in the third quarter of 1997. This increase in general and administrative
expenses was due to increased expenses related to the Company's increased sales
volume. As a percentage of sales, this increase was caused by the increase in
general and administrative costs as well as a decrease in the sales price per
copper pound sold. The provision for bad debts in the third quarter of 1998
remained relatively unchanged from $125,000 compared to $127,000 in the third
quarter of 1997. Selling expenses for the third quarter of 1998 were $3.7
million, or 5.4% of net sales, compared to $3.5 million, or 4.9% of net sales,
in the third quarter of 1997. Freight charges per copper pound of product
shipped decreased due to the a greater percentage of the Company's sales being
shipped to geographic locations closer to the Company's plant in the third
quarter of 1998 compared to the same quarter of 1997. This decrease was
partially offset by the decrease in the sales price per copper pound sold.

         Net interest expense was $589,000 in the third quarter of 1998 compared
to $254,000 in the third quarter of 1997. This increase in interest expense was
attributable to larger debt balances during the third

                                                                              11

<PAGE>   12


                                                                       FORM 10-Q


quarter of 1998 compared to the same period of 1997. The larger balances were
due to capital expenditures and increased working capital. Additionally, some of
the interest attributable to construction of the Company's expansion projects
was capitalized during the third quarter of 1997 and expensed in the third
quarter of 1998 due to the completion of the projects. The amount of interest
relating to the construction of these projects in the third quarter of 1997 was
$273,000.

         The Company's effective tax rate decreased to 39.5% in the third
quarter of 1998. This decrease from 40.4% in the third quarter of 1997 was due
to the Company's higher taxable income being taxed at higher marginal rates in
the third quarter of 1997. The Company expects its current tax rate to remain
relatively constant at 39.5%.

         As a result of the foregoing factors, the Company's net income was $5.9
million in the third quarter of 1998 compared to net income of $6.3 million in
the third quarter of 1997.


Nine Months Ended September 30, 1998 Compared to Nine Months Ended 
September 30, 1997

         Net sales for the first nine months of 1998 amounted to $196.4 million
compared with net sales of $192.7 million for the first nine months of 1997.
This increase was primarily due to an increase in sales volume of 23% offset, in
part, by a decrease in the average sales price per copper pound of the Company's
products. The decrease in the average sales price per copper pound of the
Company's products was due to a decrease of 28% in the average cost of copper
from the first nine months of 1997 to the same period in 1998, as well as
competitive pricing pressure for the Company's products in the second and third
quarters of 1998. Sales volume increased due to several factors, including
increases in customer acceptance and product availability. Sales volume of both
the residential and commercial products increased during the first nine months
of 1998 compared to the first nine months of 1997. The average sales price per
copper pound of product sold was $1.63 in the first nine months of 1998,
compared to $1.97 in the first nine months of 1997. Fluctuations in sales prices
are primarily a result of price competition and changing copper raw material
prices.

         Cost of goods sold was $153.1 million in the first nine months of 1998,
compared to $153.7 million in the first nine months of 1997. Copper costs
decreased to $102.9 million in the first nine months of 1998 from $113.8 million
in the first nine months of 1997. The average cost per copper pound purchased
decreased to $.83 in the first nine months of 1998 from $1.15 in the first nine
months of 1997. Copper costs as a percentage of net sales decreased to 52.4% in
the first nine months of 1998 from 59.1% in the first nine months of 1997. This
decrease as a percentage of net sales in the first nine months of 1998 from the
comparable period in 1997 was due primarily to lower copper costs per pound of
product sold partially offset by a slightly decreased differential between what
the Company pays per pound of copper purchased and the Company's net sales price
per copper pound. This differential decreased in the first nine months of 1998
due to a lesser decrease in the average cost per copper pound purchased than in
the sales price per copper pound. The decreased differential was a result of
competitive pricing conditions in the second and third quarters of 1998. Other
raw material costs as a percentage of net sales increased to 14.4% in the first
nine months of 1998, compared with 12.2% in the first nine months of 1997. This
increase is due to a decrease in the sales price per copper pound sold, as
discussed above, which more than offset the slight decrease in raw materials per
pound of copper sold. Depreciation, labor and overhead costs as a percentage of
net sales increased to 12.2% in the first nine months of 1998 compared to 8.5%
in the first nine months of 1997. This increase is due to an increase

                                                                              12

<PAGE>   13


                                                                       FORM 10-Q



in depreciation, labor and overhead per pound of copper sold relating to the
Company's expansion projects as well as a lower sales price per copper pound of
product sold as discussed above.

         Inventories are stated at the lower of cost, determined by the last in,
first out (LIFO) method, or market. As permitted by generally accepted
accounting principles, the Company maintains its inventory costs and cost of
goods sold on a first in, first out (FIFO) basis and makes a quarterly LIFO
adjustment to adjust total inventory and cost of goods sold to LIFO. The price
of copper decreased during the first nine months of 1998, necessitating a
decrease in the LIFO reserve of $3.0 million that resulted in an increase to the
inventory value and a decrease in cost of goods sold. In the first nine months
of 1997, the price of copper decreased slightly, necessitating a decrease in the
LIFO reserve of $122,000 that resulted in an increase to the inventory value and
a decrease in cost of goods sold. At September 30, 1998, LIFO value exceeded the
market value of the inventory by $2,163,000 and an addition to the lower of cost
or market reserve in the amount of $886,000 was required. This adjustment
decreased the amount of the inventory and increased cost of goods sold. At
September 30, 1997, LIFO cost did not exceed the market value of the inventory
and no adjustment to lower the cost of inventory to market was necessary. Future
reductions in the price of copper could require the Company to record additional
lower of cost or market adjustments against the related inventory balance which
would result in a negative impact on net income. In addition, if the quantity of
inventory is reduced in any period, copper that is carried in inventory at a
cost different from the cost of copper in the period in which the reduction
occurs will be included in cost of goods sold at the different price.

         Gross profit increased to $43.2 million, or 22.0% of net sales, for the
first nine months of 1998 from $39.0 million, or 20.3% of net sales, for the
first nine months of 1997. The increase in gross profit as a percentage of net
sales was due primarily to larger unit volume in the first nine months of 1998
compared to the first nine months of 1997 which was partially offset by
competitive pricing for the Company's products in the second and third quarter
of 1998 as discussed above.

         General and administrative expenses increased to $3.2 million, or 1.6%
of net sales, in the first nine months of 1998 compared to $2.5 million, or 1.3%
of net sales, in the first nine months of 1997. This increase in general and
administrative expenses was due to increased expenses related to the Company's
increased sales volume. As a percentage of sales, this increase was caused by
the increase in general and administrative costs as well as a decrease in the
sales price per copper pound sold. The provision for bad debts in the first nine
months of 1998 increased to $500,000 compared to $341,000 in the first nine
months of 1997. This increase was due to a larger accounts receivable balance at
September 30, 1998 than September 30, 1997. Selling expenses for the first nine
months of 1998 were $10.4 million, or 5.3% of net sales, compared to $9.3
million, or 4.8% of net sales, in the first nine months of 1997. Freight charges
per copper pound of product shipped decreased due to the a greater percentage of
the Company's sales being shipped to geographic locations closer to the
Company's plant in the first nine months of 1998 compared to the same period of
1997. This decrease was offset by the decrease in the sales price per copper
pound sold.

         Net interest expense remained relatively constant at $1.1 million in
the first nine months of 1998 compared to the first nine months of 1997. Despite
interest expense remaining relatively constant, the Company had a higher average
debt balance outstanding during the first nine months of 1998 than the
comparable period in 1997. However, the amount of interest relating to the
construction of the Company's expansion products in 1998 exceeded the amount
capitalized in 1997. The increase in average debt outstanding was the result of
capital expenditures and additional working capital. The decreased cost of
copper in the first nine months of 1998 compared to the same period in 1997
decreased the amount

                                                                              13

<PAGE>   14


                                                                       FORM 10-Q



of working capital necessary for inventory, but this was partially offset by
increased quantities of inventory and an increased accounts receivable balance
in 1998.

         The Company's effective tax rate increased to 39.8% in the first nine
months of 1998 compared to 39.5% in the first nine months of 1997. This increase
was due to the accrual for a non deductible penalty in the first nine months of
1998 (See Part II - Item 1. Legal Proceedings). Without the accrual of this
amount, the Company's effective tax rate would have been 39.5%.

         As a result of the foregoing factors, the Company's net income
increased to $16.9 million in the first nine months of 1998 from $15.6 million
in the first nine months of 1997.

LIQUIDITY AND CAPITAL RESOURCES

         The Company maintains a substantial inventory of finished products to
satisfy customers' prompt delivery requirements. As is customary in the
industry, the Company provides most of its customers payment terms that exceed
terms that it receives from its suppliers. Therefore, the Company's liquidity
needs have generally consisted of operating capital necessary to finance these
receivables and inventory. Capital expenditures have historically been necessary
to expand the production capacity of the Company's manufacturing operations. The
Company has satisfied its liquidity and capital expenditure needs with cash
generated from operations, borrowings under its revolving credit facilities and
sales of its common stock.

         Effective June 9, 1997, the Company completed an unsecured loan
facility with a group of banks (the "Financing Agreement"). This Financing
Agreement has been amended four times since June 9, 1997 to change, among other
items, the maximum borrowing amount, the term of the loan covenants and the
allowable purchases of the Company's common stock. The Financing Agreement
provides for maximum borrowings of the lesser of $65.0 million or the amount of
eligible accounts receivable plus the amount of eligible finished goods and raw
materials, less any available reserves established by the banks. The calculated
maximum borrowing amount available at September 30, 1998, as computed under the
Financing Agreement, was $65.0 million. The Financing Agreement is unsecured and
contains customary covenants and events of default. The Company was in
compliance with these covenants, as amended, as of September 30, 1998. Pursuant
to the Financing Agreement, the Company is prohibited from declaring, paying or
issuing cash dividends. At September 30, 1998, the balance outstanding under the
Financing Agreement was $54.0 million. Amounts outstanding under the Financing
Agreement are payable on May 31, 2001 with interest due quarterly based on the
bank's prime rate or LIBOR Rate options, at the Company's election.

         In March 1995, the Board of Directors authorized the Company to
purchase up to 900,000 shares, or approximately 5.6%, of its outstanding common
stock dependent upon market conditions. Purchases made pursuant to this common
stock authorization are made in the open market or through privately negotiated
transactions. As of September 30, 1998, the Company had repurchased an aggregate
of 502,575 shares of its common stock in the open market at a weighted average
price of $8.89 per share. The Financing Agreement, as amended, discussed above
allows the Company to purchase up to 900,000 shares with an aggregate price of
these shares not to exceed $11,300,000. The Company purchased 202,200 shares
under this authorization during the third quarter of 1998.



                                                                              14

<PAGE>   15


                                                                       FORM 10-Q



         Cash used by operations was $3.5 million in the first nine months of
1998 compared to cash provided by operations of $8.1 million in the first nine
months of 1997. This decrease in cash provided by operations is primarily the
result of an increase in inventories during the first nine months of 1998
compared to a decrease in inventories during the same period of 1997.
Additionally, accounts payable and accrued liabilities decreased during the
first nine months of 1998 compared to an increase in the first nine months of
1997. Cash used in investing activities increased from $15.2 million in the
first nine months of 1997 to $25.9 million in the first nine months of 1998.
These funds were used primarily to increase the Company's production capacity,
purchase land adjacent to its production facility and construct the Company's
copper rod fabrication facility and finished goods distribution facility. The
cash provided by financing activities in the first nine months of 1997 and 1998
was due primarily to borrowings, offset by $2.9 million used to purchase common
stock as discussed above.

         During the remainder of 1998, the Company expects its capital
expenditures will consist of additional manufacturing equipment for its
residential and commercial wire operations. In addition, the Company is in the
process of constructing and equipping a facility to manufacture polyvinyl
chloride ("PVC"). The Company currently purchases PVC for insulating its wire
products. The total capital expenditures associated with the completion of this
facility and the additional manufacturing equipment are estimated to be
approximately $8.0 million. The Company anticipates its working capital
requirements will continue to increase during 1998 as a result of expected
continued increases in sales. The Company believes that the cash flow from
operations and cash available pursuant to the Financing Agreement will satisfy
working capital needs and capital expenditure requirements for the next twelve
months.

IMPACT OF YEAR 2000

         The year 2000 issue is the result of computer programs being written
using two digits rather than four to define the applicable year. Any computer
program that has date sensitive software may recognize a date using "00" as the
year 1900 rather than the year 2000. This could result in a temporary inability
to process transactions or engage in normal manufacturing or other business
activities.

         The Company has completed its initial review of the impact of the year
2000 issue on the Company's information systems and support systems, including
hardware and software used in the manufacture and distribution of its products.
Based on the Company's initial inventory and assessment of its systems, the
Company does not believe that any modifications to or replacement of its
information technology or other systems are necessary as a result of the year
2000 problem.

         The Company has not initiated formal communications with its
significant third party suppliers and customers to determine the extent to which
the Company may be vulnerable to their failure to correct their own year 2000
issues. The Company intends to initiate such communications in the fourth
quarter of 1998 and to complete the process in the Spring of 1999. The Company
believes its significant trading partners have addressed year 2000 issues, but
their failure to do so could have a material adverse effect on the Company's
operations.

         A contingency plan has not been developed for dealing with the most
reasonably likely year 2000 worst case scenario, and such scenario has not been
clearly identified. The Company intends to review in the Spring of 1999 the
extent to which contingency plans may be required for any third parties who fail
to achieve year 2000 compliance. The Company currently plans to complete such
analysis and any necessary contingency planning by December 31, 1999.

                                                                              15

<PAGE>   16


                                                                       FORM 10-Q



         The Company believes that the cost of its year 2000 identification,
assessment, remediation and testing efforts, will not exceed $100,000, and to
date the Company has incurred costs significantly less than that amount in
connection with such efforts. The costs and timing of such efforts by the
Company are based on management's current evaluation using available
information. Factors that might cause material changes include, but are not
limited to availability of key year 2000 personnel, the readiness of third
parties and the Company's ability to respond to unforeseen year 2000
complications.

         While the Company believes its efforts to address the year 2000 issue
will be successful in avoiding any material adverse effect on the Company's
operations or financial condition, it recognizes that failure by the Company,
its customers or vendors to resolve adequately the year 2000 problem on a timely
basis could, in a most reasonably likely worst case scenario, limit its ability
to manufacture and distribute its products and process its daily business
transactions for a period of time, especially if such failure is coupled with
infrastructure failures.

INFORMATION REGARDING FORWARD LOOKING STATEMENTS

         This report contains various forward-looking statements and information
that are based on management's belief as well as assumptions made by and
information currently available to management. Although the Company believes
that the expectations reflected in such forward-looking statements are
reasonable, it can give no assurance that such expectations will prove to have
been correct. Such statements are subject to certain risks, uncertainties and
assumptions. Should one or more of these risks or uncertainties materialize, or
should underlying assumptions prove incorrect, actual results may vary
materially from those expected. Among the key factors that may have a direct
bearing on the Company's operating results are fluctuations in the economy and
in the level of activity in the building and construction industry, demand for
the Company's products, the impact of price competition and fluctuations in the
price of copper.

                                                                              16

<PAGE>   17


                                                                       FORM 10-Q





                           PART II. OTHER INFORMATION

ITEM 1.  LEGAL MATTERS

         On August 20, 1997, the Company was inspected by the U.S. Environmental
Protection Agency (the "EPA") to determine the Company's compliance with the
requirements of the Emergency Planning and Community Right-to-Know Act
provisions ("EPCRA") of the Comprehensive Environmental Response, Compensation
and Liability Act, as amended. In general, EPCRA requires private businesses to
maintain and file with the government specified documents concerning the on-site
recycling and off-site management of a defined group of chemicals, including
metal compounds. The Company was required to provide the EPA by September 12,
1997 with information concerning its processing of copper, lead compounds,
antimony compounds and methyl ethyl ketone for calendar years 1994 and 1995.
This information was researched by the Company and the required documents were
timely filed with the EPA.

         In a separate matter, by letter dated February 17, 1998, the Company
was issued "Findings of Violation and Order for Compliance" by the EPA. In this
document, the EPA alleged that the Company had failed to obtain a federal storm
water discharge permit pursuant to the Clean Water Act ("CA") for its past and
current operations in McKinney, Texas and to otherwise meet the terms of this
permitting program. The Company was ordered timely to (1) apply for a federal
storm water discharge permit, (2) prepare and submit a Storm Water Pollution
Prevention Plan and (3) prepare and file a report with the EPA describing
actions the Company has taken or would take to correct alleged violations. On
March 6, 1998, the Company applied for a federal storm water discharge permit
and on March 23, 1998, the Company filed the Storm Water Pollution Prevention
Plan and the written report required by the "Findings of Violation and Order for
Compliance" with the EPA.

         In addition, the "Findings of Violation and Order for Compliance"
offered the Company the opportunity to contact the EPA to schedule a show cause
hearing to demonstrate to the EPA why it should not take further enforcement
action against the Company relating to the matters stated in this document. The
Company requested a show cause hearing, and it was held on April 13, 1998.

         On April 17, 1998, the Company was issued a consolidated "Complaint and
Notice of Opportunity for Hearing" by the EPA (the "1998 Complaint"). In the
1998 Complaint, the EPA proposed a civil penalty of $151,000 for seven alleged
violations of EPCRA's reporting requirements and a civil penalty of $27,500 for
the alleged failure to have a federal storm water discharge permit. In
accordance with the EPA's Rule of Practice, the Company filed an Answer to the
Complaint and requested an informal settlement conference and a hearing on all
matters alleged by the EPA. The Company is vigorously defending itself in this
matter.







                                                                              17

<PAGE>   18


                                                                       FORM 10-Q




                           PART II. OTHER INFORMATION

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

         (a)      Exhibits

                  10.1     Third Amendment to Second Amended and Restated
                           Financing Agreement dated as of August 28, 1998 by
                           and among Encore Wire Corporation, NationsBank of
                           Texas, N.A. and Comerica Bank - Texas.

                  10.2     Fourth Amendment to Second Amended and Restated
                           Financing Agreement dated as of October 28, 1998 by
                           and among Encore Wire Corporation, NationsBank of
                           Texas, N.A. and Comerica Bank - Texas.

                  27       Financial Data Schedule

         (b)      No reports on form 8-K were filed by the Company during the
                  three months ended September 30, 1998.


                                                                             18

<PAGE>   19


                                                                       FORM 10-Q



                                   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.


                                           ENCORE WIRE CORPORATION
                              -------------------------------------------------
                                                (Registrant)


Date: November 12, 1998                      /s/ VINCENT A. REGO
                              -------------------------------------------------
                                       Vincent A. Rego, President and
                                           Chief Executive Officer


Date: November 12, 1998                      /s/ DANIEL L. JONES
                              -------------------------------------------------
                                         Daniel L. Jones, President


Date: November 12, 1998                      /s/ SCOTT D. WEAVER
                              -------------------------------------------------
                                 Scott D. Weaver, Vice President - Finance,
                                           Treasurer and Secretary
                                        (Principal Financial Officer)

                                                                              19

<PAGE>   20


                                                                       FORM 10-Q



                                INDEX TO EXHIBITS


<TABLE>
<CAPTION>

                                                                                         Sequentially
Exhibit                                                                                    Numbered
Number                               Exhibit                                                 Page
------                               -------                                                 ----
<S>      <C>                                                                             <C>

10.1     Third Amendment to Second Amended and Restated Financing Agreement
         dated as of August 28, 1998 by and among Encore Wire Corporation,
         NationsBank of Texas, N.A. and Comerica Bank - Texas............................      21

10.2     Fourth Amendment to Second Amended and Restated Financing Agreement
         dated as of October 28, 1998 by and among Encore Wire Corporation,
         NationsBank of Texas, N.A. and Comerica Bank - Texas............................      22

10.3     $50,000,0.0 Revolving Note to NationsBank of Texas, N.A. .......................      23

10.4     $15,000,0.0 Revolving Note to Comerica Bank - Texas.............................      24

27       Financial Data Schedule
</TABLE>







                                                                              20