<PAGE>   1

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

                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 10-Q
                                 ---------------

(Mark One)
[X]   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934

      For the quarterly period ended July 1, 2000

                                       OR

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

      For the transition period from _________________ to ______________________

                         Commission File Number 33-67854
                                                --------

                              CMI INDUSTRIES, INC.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified, on its charter)

            Delaware                                                57-0836097
--------------------------------------------------------------------------------
(State or other jurisdiction of incorporation                 (I.R.S. Employer
or organization)                                             Identification No.)

1301 Gervais Street, Suite 700, Columbia, South Carolina                 29201
--------------------------------------------------------------------------------
(Address of principal executive office)                              (Zip Code)

Registrant's telephone number including area code:                (803) 771-4434


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 [ ]

As of July 1, 2000, there were 595,031 shares of $1 Par Value Common Stock
outstanding.

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


<PAGE>   2

PART I FINANCIAL INFORMATION

Item 1. Consolidated Financial Statements

                              CMI INDUSTRIES, INC.
                                AND SUBSIDIARIES

                      Consolidated Statements of Operations
                      (000's Omitted Except Per Share Data)
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                          THREE MONTHS ENDED               SIX MONTHS ENDED
                                                                      --------------------------      --------------------------
                                                                       JULY 3,         JULY 1,          JULY 3,        JULY 1,
                                                                         1999            2000            1999            2000
                                                                      ----------      ----------      ----------      ----------

<S>                                                                   <C>             <C>             <C>             <C>
Net sales                                                             $   91,339      $   75,863      $  184,460      $  168,235
Cost of sales                                                             84,073          71,680         168,287         157,137
                                                                      ----------      ----------      ----------      ----------
         Gross profit                                                      7,266           4,183          16,173          11,098
Selling, general and administrative expenses                               8,017           6,460          16,213          14,629
Loss on sale of furniture fabric assets (note 8)                              --          19,602              --          19,602
Provision for restructuring and other
     nonrecurring asset write-offs (note 6)                                7,000              --           7,000              --
                                                                      ----------      ----------      ----------      ----------
Operating loss                                                            (7,751)        (21,879)         (7,040)        (23,133)

Other income (expenses):
     Interest expense                                                     (3,232)         (2,975)         (6,445)         (6,257)
     Other, net                                                              290             155             623             360
                                                                      ----------      ----------      ----------      ----------
                                                                          (2,942)         (2,820)         (5,822)         (5,897)

         Loss before income taxes and
             extraordinary item                                          (10,693)        (24,699)        (12,862)        (29,030)
Income tax provision                                                      (4,258)         (9,331)         (5,108)        (11,018)
                                                                      ----------      ----------      ----------      ----------
         Loss before extraordinary item                                   (6,435)        (15,368)         (7,754)        (18,012)
Extraordinary gain on repurchase of debt, net of taxes                        --           2,089              --           7,790
                                                                      ----------      ----------      ----------      ----------

         Net loss                                                     $   (6,435)     $  (13,279)     $   (7,754)     $  (10,222)
                                                                      ==========      ==========      ==========      ==========

Average shares outstanding during period                                   1,695             595           1,674             993

Net loss per share                                                    $    (3.90)     $   (22.32)     $    (4.63)     $   (10.29)

Depreciation and amortization included in
  the above costs and expenses                                        $    4,431      $    3,324      $    8,781      $    7,332
</TABLE>

                             See Accompanying Notes.

                                       2
<PAGE>   3

                              CMI INDUSTRIES, INC.
                                AND SUBSIDIARIES

                           Consolidated Balance Sheets
                        January 1, 2000 and July 1, 2000
                                 (000's Omitted)
<TABLE>
<CAPTION>

                                                                           JANUARY 1,             JULY 1,
                                                                              2000                 2000
                                                                           ----------           -----------
                                                                                                (UNAUDITED)

<S>                                                                        <C>                  <C>
ASSETS

      Current assets:
          Cash and cash equivalents                                        $    2,263           $    1,488

          Receivables, less allowance for doubtful
              accounts of $1,200 and $1,000, respectively                      48,017               43,158

          Inventories: (note 3)
              Raw materials                                                     8,956                5,635
              Work-in-process                                                  18,077               12,124
              Finished goods                                                   21,203               19,450
              Supplies                                                          2,950                2,408
                                                                           ----------           ----------
                                                                               51,186               39,617

          Deferred income taxes                                                 3,342                9,600
          Other current assets                                                  1,750                2,579
                                                                           ----------           ----------

              Total current assets                                            106,558               96,442

      Property, plant and equipment: (note 4)
          Land and land improvements                                            3,317                2,318
          Buildings and leasehold improvements                                 42,590               35,295
          Machinery and equipment                                             214,718              170,565
          Construction in progress                                              1,115                1,500
                                                                           ----------           ----------
                                                                              261,740              209,678
          Less accumulated depreciation and amortization                     (176,466)            (152,850)
                                                                           ----------           ----------
                                                                               85,274               56,828

      Other assets:
          Cash value of life insurance, intangibles,
              deferred charges, and other assets                               10,407               10,048
                                                                           ----------           ----------

                                                                           $  202,239           $  163,318
                                                                           ==========           ==========
</TABLE>

                             See Accompanying Notes.


                                       3
<PAGE>   4

                              CMI INDUSTRIES, INC.
                                AND SUBSIDIARIES

                           Consolidated Balance Sheets
                        January 1, 2000 and July 1, 2000
                                 (000's Omitted)

<TABLE>
<CAPTION>
                                                                           JANUARY 1,             JULY 1,
                                                                              2000                 2000
                                                                           ----------           -----------
                                                                                                (unaudited)
<S>                                                                        <C>                  <C>
LIABILITIES AND STOCKHOLDERS' EQUITY
         Current liabilities:
             Payable - book overdraft                                      $    8,200           $    6,795
             Accounts payable                                                  14,302               13,963
             Accrued expenses, including restructuring charges                 13,305               12,649
                                                                           ----------           ----------
                Total current liabilities                                      35,807               33,407

         Long-term debt (note 2)                                              128,814              114,436
         Other liabilities                                                     12,143                9,168

         Stockholders' equity:
             Common stock of $1 par value per share; 2,100,000 shares
                authorized, 1,589,318 shares issued and outstanding at
                January 1, 2000; and 820,000 authorized, 595,031 shares
                issued and outstanding at July 1, 2000                          1,589                  595
             Paid-in capital                                                    8,814                  862
             Retained earnings (note 2)                                        15,072                4,850
                                                                           ----------           ----------

                Total stockholders' equity                                     25,475                6,307
                                                                           ----------           ----------

                                                                           $  202,239           $  163,318
                                                                           ==========           ==========
</TABLE>

                             See Accompanying Notes.


                                       4
<PAGE>   5

                              CMI INDUSTRIES, INC.
                                AND SUBSIDIARIES

                      Consolidated Statements of Cash Flows
             For the Six Months Ended July 3, 1999 and July 1, 2000
                                 (000's Omitted)

<TABLE>
<CAPTION>
                                                                             JULY 3,               JULY 1,
                                                                              1999                  2000
                                                                           -----------           -----------
                                                                           (unaudited)           (unaudited)
<S>                                                                        <C>                   <C>
Cash flows from operating activities:
    Net loss                                                               $   (7,754)          $  (10,222)
    Adjustments to reconcile net loss to net cash
        provided by (used in) operating activities:
         Depreciation and amortization                                          8,781                7,332
         Gain on purchase of senior subordinated notes                             --              (12,554)
         Loss on sale of furniture fabric assets                                   --               19,602
         Nonrecurring asset write-offs                                          6,000                   --
         Changes in assets and liabilities
             Receivables                                                        2,286               (5,244)
             Inventories                                                       (2,821)              (6,983)
             Other current assets                                               5,864               (2,320)
             Other assets                                                        (615)                (155)
             Accounts payable                                                   1,901                3,920
             Accrued expenses                                                    (554)                 756
             Deferred income taxes                                             (5,197)              (6,258)
             Other liabilities                                                    (49)                (975)
                                                                           ----------           ----------
             Net cash provided by (used in) operating activities                7,842              (13,101)
                                                                           ----------           ----------

Cash flows from investing activities:
    Capital expenditures, net                                                  (5,548)              (1,392)
    Proceeds from sale of furniture fabric assets                                  --               25,630
                                                                           ----------           ----------
             Net cash provided by (used in) investing activities               (5,548)              24,238
                                                                           ----------           ----------

Cash flows from financing activities:
    Net borrowings on revolving credit facilities                               3,795               11,601
    Purchase of Senior Subordinated Notes                                          --              (13,162)
    Purchase of common stock, net                                              (2,650)              (8,946)
    Net change in payable-book overdraft                                       (5,963)              (1,405)
                                                                           ----------           ----------
             Net cash used in financing activities                             (4,818)             (11,912)
                                                                           ----------           ----------

             Net decrease in cash                                              (2,524)                (775)

Cash and cash equivalents at beginning of year                                  3,911                2,263
                                                                           ----------           ----------
Cash and cash equivalents at end of period                                 $    1,387           $    1,488
                                                                           ==========           ==========

Supplemental disclosures of cash flow information:
     Cash paid during the period for:
     Interest                                                              $    6,254           $    6,549
                                                                           ==========           ==========
</TABLE>

                             See Accompanying Notes.


                                       5
<PAGE>   6

Notes to Consolidated Financial Statements

Note 1:

Basis of Presentation:

         The consolidated financial statements include the accounts of the
Company and its wholly owned subsidiaries. All significant intercompany balances
and transactions have been eliminated. In the opinion of management, the
accompanying unaudited consolidated financial statements include all adjustments
necessary to present fairly the Consolidated Balance Sheet as of July 1, 2000,
the Consolidated Statements of Cash Flows for the six months ended July 3, 1999
and July 1, 2000, and the Consolidated Statements of Operations for the three
months and six months then ended. All dollar amounts contained in the financial
statements and accompanying notes are rounded to thousands unless otherwise
indicated. The Consolidated Balance Sheet as of January 1, 2000 has been
audited, but the auditors' report is not included herein. The disclosures
accompanying these interim financial statements are condensed and should be read
in conjunction with the disclosures in the annual financial statements.

Note 2:

Long-Term Debt:

         In October 1993, the Company completed a public offering ("the
Offering") of $125,000 in aggregate principal amount of 9 1/2% Senior
Subordinated Notes ("Notes") due October 1, 2003. The Notes are general
unsecured obligations of the Company. Interest on the Notes is payable
semiannually. The Notes are redeemable at the option of the Company at the
following redemption prices (expressed as a percentage of the principal amount),
plus accrued interest, if redeemed during the 12-month period beginning on
October 1 of the years indicated:

<TABLE>
<CAPTION>
                      Year                      Redemption Price
                      ----                      ----------------
                      <S>                       <C>
                      1999                           102.375%
                      2000 and thereafter            100.000%
</TABLE>

         During the six months ended July 1, 2000, the Company has purchased
$26,095 (face value) of these notes in the open market at prices lower than face
value. After a reduction of $379 for the write-off of the related unamortized
bond issue discount and debt issue costs, these purchases have resulted in an
extraordinary gain of $7,790, net of income taxes. The recorded balance of
$98,653 at July 1, 2000, is presented net of $252 of unamortized bond issue
discount that is being amortized over the period to maturity. The latest
information available indicates the fair value of the remaining outstanding
Notes was approximately $49,453 at July 1, 2000. The fair value presented herein
is not necessarily indicative of the amounts that the Company would realize in a
current market exchange.

         In March 1996, the Company replaced a $92 million unsecured revolving
credit facility with a new credit agreement and renewed a Wachovia Bank of South
Carolina facility at $4 million. The Company and its lenders amended the new
credit agreement in February 1997 to reduce the borrowing limit to $65 million,
to contemplate the realignment of the Company's assets into separate operating
entities, which was completed during 1997, and to extend the maturity of the
secured revolving credit facility by two years to January 2000. The Company and
its lenders amended the secured revolving credit facility again in June 1999 to
reduce the borrowing limit to $45 million and to extend the maturity of the
secured revolving credit facility by another two years to March 2002. Following
the sale of the furniture fabric assets on May 1, 2000, the Company and its
lenders amended the facility again to reduce the borrowing limit to $40 million.
The borrowings under the amended credit agreement are secured by all
receivables, certain inventories and certain intangibles.


                                       6
<PAGE>   7

Long-term debt as of January 1, 2000 and July 1, 2000 consisted of:

<TABLE>
<CAPTION>
                                                          January 1, 2000       July 1, 2000
                                                          ---------------       ------------
         <S>                                              <C>                   <C>
         Borrowings under credit agreements:
                  Secured revolving credit facility          $    4,182          $   15,783
                  Senior subordinated notes, net                124,632              98,653
                                                             ----------          ----------
                                                                128,814             114,436
         Less current portion                                        --                  --
                                                             ----------          ----------
         Long-term debt                                      $  128,814          $  114,436
                                                             ==========          ==========
</TABLE>

         The amended secured revolving credit facility requires a commitment fee
of 1/4 of 1% per annum on all unused amounts and as of July 1, 2000, the Company
could have borrowed an additional $20 million under the amended secured
revolving credit facility. Interest on the secured revolving credit facility is
based on a floating prime rate or a eurodollar rate plus 1 1/4%. At July 1,
2000, the prime borrowing interest rate on the revolving credit facility was
9.5% and the eurodollar borrowing rate was 7.76%.

         The credit agreements and indenture contain various restrictive
covenants and conditions requiring, among other things, minimum levels of net
worth, certain interest coverage ratios, prohibitions against certain borrowings
and advances, and a negative covenant limiting the Company's right to grant
security interests or other liens on its assets. In addition, the credit
agreement and the indenture pursuant to which the Notes were issued contain
restrictions on the Company's ability to pay cash dividends or purchase its
capital stock. Under the most restrictive covenant, as of July 1, 2000, the
Company was not authorized to pay any dividends or make any capital stock
purchases. At July 1, 2000, the Company was in compliance with, or had received
waivers for, all covenants under all credit agreements.

         As part of the Company's workers' compensation insurance agreements in
South Carolina, Alabama, Georgia and Virginia, the Company has obtained letters
of credit for $900, $200, $250 and $75, respectively. The letters of credit
expire on January 11, 2001, June 30, 2001, January 11, 2001 and April 10, 2001,
respectively. At July 1, 2000, the Company owed no amount under these letters of
credit.

Note 3:

Inventories:

         Inventories at January 1, 2000 and July 1, 2000 are stated at the lower
of cost (first-in, first-out) or market, and include the costs of raw materials,
direct labor, and manufacturing overhead.

Note 4:

Property, Plant and Equipment:

         All additions to property, plant and equipment are stated at cost.
Depreciation is calculated for financial reporting purposes by the straight-line
method over the estimated useful lives of the respective assets.

Note 5:

Segment Information

         The Company manages its businesses through three operating divisions:
the Greige Fabrics Division, the Elastic Fabrics Division, and the Chatham
Division. The Greige Fabrics Division produces greige woven fabrics, such as
printcloths, broadcloths, twills and other fabrics used in home furnishings,
apparel and industrial applications. The Elastic Fabrics division produces woven
and knitted elasticized fabrics used in the manufacturing of intimate apparel,
activewear and swimwear. The Chatham Division produces upholstery fabrics used
in the automotive industry and consumer products used in the home textile
industry. Prior to May 1, 2000 and the sale of Chatham's furniture fabric
assets, the Chatham Division also produced upholstery for the furniture
industry.


                                       7
<PAGE>   8

Information about the Company's three segments and the items necessary to
reconcile this information to the Company's consolidated results are as follows:

<TABLE>
<CAPTION>
                                                                    Six Months Ended
                                                           -----------------------------------
                                                           July 3, 1999          July 1, 2000
                                                           ------------          ------------
<S>                                                        <C>                   <C>
        Net sales
        Greige                                              $   55,400            $   55,292
        Chatham                                                 78,681                67,721
        Elastics                                                50,379                45,222
                                                            ----------            ----------
        Total                                               $  184,460            $  168,235
                                                            ==========            ==========

Operating loss before nonrecurring items
        Greige                                              $   (4,402)           $   (5,638)
        Chatham                                                    353                   305
        Elastics                                                 6,356                 3,610
        Corporate                                               (2,347)               (1,808)
                                                            ----------            ----------
        Total                                                      (40)               (3,531)

Nonrecurring items                                               7,000                19,602
Interest expense                                                 6,445                 6,257
Other (income), net                                               (623)                 (360)
                                                            ----------            ----------

Loss before income taxes and extraordinary item             $  (12,862)           $  (29,030)
                                                            ==========            ==========

Operating margin
        Greige                                                    (7.9)                (11.1)
        Chatham                                                    0.4                   0.5
        Elastics                                                  12.6                   8.0
                                                            ----------            ----------
        Total                                                     (0.0)%                (2.4)%
                                                            ==========            ==========

Identifiable assets
        Greige                                              $   74,765            $   67,596
        Chatham                                                 76,812                25,810
        Elastics                                                44,363                43,425
        Corporate                                               11,494                26,487
                                                            ----------            ----------
        Total                                               $  207,434            $  163,318
                                                            ==========            ==========

Depreciation and amortization
        Greige                                              $    4,520            $    4,175
        Chatham                                                  2,541                 1,603
        Elastics                                                 1,261                 1,109
        Corporate                                                  459                   445
                                                            ----------            ----------
        Total                                               $    8,781            $    7,332
                                                            ==========            ==========

Capital expenditures
        Greige                                              $      871            $      247
        Chatham                                                  3,027                   706
        Elastics                                                   992                   312
        Corporate                                                  658                   127
                                                            ----------            ----------
        Total                                               $    5,548            $    1,392
                                                            ==========            ==========
</TABLE>


                                       8
<PAGE>   9

Note 6:

Restructuring Charges

Second Quarter 1999 Restructuring Charges

         In the second quarter of 1999, the Company approved a plan to pursue
restructuring initiatives in all divisions. These initiatives were focused on
discontinuing certain weaving and yarn manufacturing operations which, when
coupled with certain yarn outsourcing strategies, reduced the Company's
operating costs, downsized its fabric formation capacity to levels more in line
with market demand, and conserved capital for other equipment modernization
projects. In conjunction with these efforts, the Company consolidated certain
manufacturing capacity, realigned certain management responsibilities and
disposed of idle equipment and related inventories. Except for completing
certain asset dispositions, these initiatives have been substantially completed.
The restructuring initiatives included the termination and retirement of
approximately 170 associates, including the associated severance costs relating
to insurance, vacation and other benefits. The Company originally reported a
$7,000 charge to earnings in connection with the restructuring initiatives and
continues to reserve for the following items in the accompanying balance sheet
as of July 1, 2000:

<TABLE>
<CAPTION>
                                                                 January 1, 2000      July 1, 2000
                                                                 ---------------      ------------
         <S>                                                     <C>                  <C>
         Restructuring items:
                  Severance and related benefit costs                $    446          $    160

         Other nonrecurring asset write-offs:
                  Inventory write-offs                                    973               273
                  Property, plant & equipment write-offs                2,684               963
                  Other asset write-offs                                  389               256
                                                                     --------          --------
                                                                     $  4,492          $  1,652
                                                                     ========          ========
</TABLE>

         Included in the $7,000 charge were approximately $1,000 of incremental
cash expenditures. During the six months ended July 1, 2000, the Company funded
$286 of cash related restructuring items and had net asset disposals of $2,554
related to the restructuring.

Note 7:

Purchase of Common Stock from Merrill Lynch Capital Partners, Inc.

         On March 14, 2000, the Company completed the purchase of 994,387 shares
of the Company's Common Stock held by Merrill Lynch Capital Partners, Inc. and
its affiliates for a purchase price of $9.00 per share or an aggregate amount of
$8,949,483. As a result of this transaction, the stockholder affiliates of
Merrill Lynch Capital Partners, Inc. which previously owned more than 62% of the
outstanding Common Stock of the Company no longer own any Common Stock. Instead,
members of management and other stockholders with historical ties to the Company
own all of the outstanding shares of Common Stock. The consideration paid to the
stockholder affiliates of Merrill Lynch Capital Partners, Inc. was funded
through the Company's secured revolving credit facility.

Note 8:

Sale of Furniture Fabric Assets of Chatham Division

         On May 1, 2000, the Company completed the sale of the furniture fabric
assets of its Chatham Division to Interface, Inc. for a purchase price of $25.6
million in cash. Sales associated with the furniture fabric assets for the four
months ended May 1, 2000 amounted to approximately $25.0 million. The sale
resulted in a pretax loss of approximately $19.6 million which was reflected as
a charge to operations during the second quarter of 2000. The Company used the
proceeds from the sale to pay down the outstanding indebtedness under its
secured revolving credit facility. In conjunction with completing the sale of
its furniture fabric assets, the Company and its lenders also amended the
secured revolving credit facility to allow for the disposition of the furniture
fabric assets. The amendment also reduced the borrowing limit under the facility
to $40 million and revised certain financial covenants.


                                       9
<PAGE>   10

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

         This report contains statements which to the extent that they are not
recitations of historical fact, may constitute "forward looking statements"
within the meaning of applicable federal securities laws. All forward looking
statements contained in this report are intended to be subject to the safe
harbor protection provided by the Private Securities Litigation Reform Act of
1995 and Section 21E of the Securities Exchange Act of 1934, as amended. For a
discussion identifying some important factors that could cause actual results to
vary materially from those anticipated in the forward looking statements made by
the Company, see the Company's Annual Report on Form 10-K for the year ended
January 1, 2000, including, but not limited to, the "Overview" discussion and
the "Results of Operations" discussion to Management's Discussion and Analysis
of Financial Condition of the Annual Report.

Results of Operations

Three Months Ended July 1, 2000
Compared with Three Months Ended July 3, 1999

Sales

         Sales for the three months ended July 1, 2000, decreased $15.4 million,
or 16.9%, from $91.3 million to $75.9 million as compared to the corresponding
period of 1999. Sales of the Greige Fabrics Division increased $0.4 million, or
1.6%, while sales for the Elastic Fabrics Division decreased $3.0 million or
12.0%, and sales of the Chatham Division decreased $12.9 million or 32.4% from
the prior year. The increase in sales for the Greige Fabrics Division consisted
of (1) a $0.6 increase in sales of 100% filament fabrics produced at the
Company's Clarkesville, Georgia facility and (2) a $0.2 million decrease in
sales of blended or 100% cotton fabrics, resulting from a 3.3% decrease in
average selling prices and a 2.4% increase in volume. Market demand for the
Company's commodity oriented greige fabrics continues to be very weak, and the
growing availability of lower priced Asian fabrics continues to suppress market
selling prices. The decrease in sales in the Elastic Fabrics Division consisted
of a 13.8% decrease in sales of wide elastics and a 7.8% decrease in sales of
narrow elastics. The decline in elastics sales reflects both the reduced demand
by customers due to inventory initiatives at retail and certain operational
inefficiencies which have disrupted the Elastics Division's on-time delivery
performance. The sales decrease for the Chatham Division included a $2.8 million
decrease in automotive upholstery sales and a $11.4 million decrease in
furniture upholstery sales, while sales of consumer products increased by $1.3
million or approximately 30%. The decline in furniture sales reflects the sale
of Chatham's furniture fabric assets on May 1, 2000 while the decline in
automotive sales is consistent with the reduction in 2000 model year vehicle
placements of Chatham's automotive upholstery fabrics.

Earnings

         The Company reported an operating loss of $21.9 million for the
three-month period ended July 1, 2000. Included in the current period's
operating loss was a $19.6 million charge associated with the sale of the
Company's furniture fabric assets. Included in the prior year's operating loss
of $7.8 million was a $7.0 million restructuring charge associated with the
Company's decision to discontinue certain manufacturing operations and other
initiatives designed to reduce costs. Excluding these two non-recurring items,
operating income would have declined $1.5 million for the three month period
ended July 1, 2000 as compared to the same period a year ago. The decline in
earnings is primarily attributed to the Elastics Division as lower sales coupled
with continued operational inefficiencies and quality issues combined to reduce
the Elastic Division's operating income by $1.5 million. Additionally, the
continued influx of lower priced imported fabrics and excess inventory levels
continued to suppress demand and selling prices for domestically produced greige
fabrics, and consequently, the Company has not reported any improvement in its
Greige Division's earnings. Earnings in the Chatham Division were up marginally
in the three month period ended July 1, 2000, but could only partially offset
the decline in earnings associated with the Elastics Division.


                                       10
<PAGE>   11

         Interest expense for the three months ended July 1, 2000 was $3.0
million, as compared to $3.2 million for the corresponding period in 1999. Other
income, net, for the three months ended July 1, 2000 was $0.2 million, a
decrease of $0.1 million from the same period in 1999.

         As a result of the above mentioned items, the net loss before income
taxes and extraordinary item increased $14.0 million for the three months ended
July 1, 2000 over the corresponding period in 1999, while the provision for
income taxes decreased $5.1 million and resulted in a $15.4 million loss before
extraordinary item for the three month period.

         Also included in the three month period ended July 1, 2000 was
extraordinary income associated with the Company's purchase of its Notes at
market prices below face value. The Company reported a $2.1 million gain on the
repurchase of its Notes, net of taxes. After considering the extraordinary item,
the Company reported a $13.3 million net loss for the three months ended July 1,
2000 as compared to a $6.4 million net loss for the corresponding period of
1999.

Six Months Ended July 1, 2000
Compared with Six Months Ended July 3, 1999

Sales

         Sales for the six months ended July 1, 2000 decreased $16.3 million, or
8.8%, from $184.5 million to $168.2 million as compared to the corresponding
period in 1999. Sales of the Greige Fabrics Division decreased $0.1 million or
0.2%, while sales of the Elastic Fabrics Division decreased $5.2 million or
10.2%, and sales of the Chatham Division decreased $11.0 million or 14.0%. The
decrease in sales of the Greige Fabrics Division consisted of (1) a $1.1 million
decrease in sales of blended or 100% cotton fabrics, resulting from a 6.7%
decrease in average selling prices and a 4.5% increase in volume, and (2) a $1.0
million increase in sales of 100% filament fabrics produced at the Company's
Clarkesville, Georgia facility. The decrease in sales in the Elastics Division
consisted of a 10.5% decrease in wide elastic sales and a 9.5% decrease in
narrow elastic sales. The decline in sales in the Chatham Division included a
$4.3 million reduction in automotive upholstery sales associated with the
Company's reduced number of placements for the 2000 model year. Sales of
furniture upholstery were down $8.2 million due to the divestiture of the
furniture fabric assets on May 1, 2000. Sales of consumer products increased
$1.5 million or 17% due to strong market demand for Chatham's blanket product
offerings.

Earnings

         The Company reported an operating loss of $23.1 million for the
six-month period ended July 1, 2000. Excluding the loss on the sale of the
furniture fabrics assets on May 1, 2000 and the restructuring charge reported in
the first half of 1999, the operating loss in the first half of 2000 has
increased $3.5 million as compared to the same period in the prior year. The
decrease in profitability is primarily attributable to the Elastic Fabrics
Division as lower sales coupled with operational inefficiencies and quality
issues have combined to reduce the Elastic Division's operating income by $2.7
million. On-time deliveries and off-quality levels appear to be improving in the
third quarter period. The Greige Fabrics Division's earnings decreased by $1.0
million as compared to the same period in 1999 as lower selling prices have
continued to depress margins. Despite lower sales levels resulting from the sale
of its furniture fabric assets, the Chatham Division's earnings remain
relatively unchanged from prior year levels.

         Interest expense for the six months ended July 1, 2000 was $6.3
million, as compared to $6.4 million for the corresponding period in 1999. Other
income, net, for the six months ended July 1, 2000, was $0.4 million, down $0.2
million from the corresponding period in 1999.

         As a result of the above mentioned items, the net loss before income
taxes and extraordinary item decreased $16.2 million for the six months ended
July 1, 2000 over the corresponding period in 1999, while the provision for
income taxes decreased $5.9 million and resulted in a $18.0 million loss before
extraordinary item for the six month period.


                                       11
<PAGE>   12

         Also included in the six month period ended July 1, 2000 was
extraordinary income associated with the Company's purchase of its Notes at
market prices below face value. The Company reported a $7.8 million gain on the
repurchase of its Notes, net of taxes. After considering the extraordinary item,
the Company reported a $10.2 million net loss for the three months ended July 1,
2000 as compared to a $7.8 million net loss for the corresponding period of
1999.


Financial Condition

         For the six months ended July 1, 2000, the Company used $11.6 million
of borrowings under its secured credit facility and $25.6 million from the sale
of its furniture fabric assets to fund $13.1 million of negative cash flow from
operations, to repurchase $13.2 million of its 9 1/2% Notes, to invest $1.4
million for capital expenditures, and to repurchase $8.9 million of the
Company's common stock. Additionally, the Company also reduced its cash position
by $0.8 million during the six months ended July 1, 2000 and reduced its payable
book overdraft by $1.4 million.

         At July 1, 2000, working capital was approximately $63.0 million as
compared to approximately $70.8 million at January 1, 2000. The decrease in
working capital includes $24.5 million of working capital related to the sale of
the furniture fabric assets on May 1, 2000. Offsetting the reduction in working
capital associated with the sale of the furniture fabric assets, the Company
reported a $5.2 million increase in receivables, a $7.0 million increase in
inventory and a $6.3 million increase in its deferred tax asset. Management is
not aware of any present or potential impairments to the Company's liquidity.

         At July 1, 2000, long-term debt of approximately $114.4 million
represented 94.8% of total capital, compared to 83.5% at January 1, 2000. The
increased leverage reflects the impact from the Company's purchase of common
stock for $8.9 million and the net loss reported of $10.2 million during the six
months ended July 1, 2000.

         The Company believes that funds from operations during the balance of
fiscal 2000 and amounts available under the amended credit agreement (see note 2
to consolidated financial statements) are adequate to finance capital
expenditures of approximately $2.0 million during the remainder of 2000, in
addition to meeting working capital requirements and scheduled debt service
payments. The Company also continues to consider various strategic business
alternatives in respect of its operations, which are consistent with maximizing
shareholder value, improving liquidity and maximizing the Company's tax planning
strategies and attributes. In performing such reviews, the Company is
considering potential asset divestitures and acquisitions that would better
position certain of its businesses to compete long term.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk

         Interest rate risk. The Company has exposure to interest rate changes
primarily relating to interest rate changes under its bank credit agreement. The
Company's bank credit agreement bears interest at rates which vary with changes
in (i) the London Interbank Offered Rate (LIBOR) or (ii) a rate of interest
announced publicly by Fleet National Bank. Although the Company is not presently
a party to any contracts in which it speculates on the direction of interest
rates, the Company has in the past and may, in the future, enter into contracts
which have the effect of speculating on the direction of interest rates. As of
July 1, 2000, the Company had $15,783 of outstanding indebtedness under its bank
credit agreements which bore interest at variable rates. The Company believes
that the effect, if any, of reasonably possible near-term changes in interest
rates on the Company's consolidated financial position, results of operations or
cash flows would not be material.

         Commodity price risk. A portion of the Company's raw material is cotton
which is subject to price volatility caused by weather, production problems,
delivery difficulties and other factors which are outside the control of the
Company. The Company believes that at certain times, changes in cotton pricing
may not be adjusted for by changes in its product pricing and therefore could
have a significant effect on the Company. Consequently, the Company purchases
futures contracts to hedge against fluctuations in the price of raw material
cotton. Increases or decreases in the market price of cotton may affect the fair
value of cotton commodity futures contracts. As of


                                       12
<PAGE>   13

July 1, 2000, the Company had contracted for 20,556 bales of cotton through
commodity futures contracts. A 10% decline in the market price of cotton would
have a negative impact of approximately $0.6 million on the fair value of the
Company's outstanding futures contracts.


                                       13
<PAGE>   14


PART II OTHER INFORMATION

Item 1.  Legal Proceedings

         None Reportable

Item 2.  Changes in Securities

         As reported in Note 2 to the Consolidated Financial Statements, the
Company's credit agreements and indenture contain various restrictive covenants,
and as of July 1, 2000, the Company was not authorized to pay any dividends in
respect of its common stock.

Item 3.  Defaults Upon Senior Securities

         None

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

         At the Annual Meeting of the stockholders of the Company on May 9,
2000, the following matters were voted upon:

         A.       The stockholders elected the following individuals to the
                  Board of Directors of the Company by a vote of 436,200 shares
                  for (or 73.3%), 154,650 shares against (or 26%), and 4,081
                  shares not voting (or 0.7%):

                  Joseph L. Gorga                    William R. Davis
                  James A. Ovenden                   Rupinder S. Sidhu
                  Steve F. Warren

         B.       The stockholders also elected J. R. Swetenburg as a member of
                  the Board of Directors of the Company by a vote of 439,850
                  shares for (or 73.9%), 97,000 shares voting for other
                  nominations (or 16.3%), and 58,081 shares not voting (or
                  9.8%).

         C.       The stockholders amended Section 3.08 of Article III of the
                  Bylaws of the Company to require the vote of not less than 75%
                  of the directors then in office to approve matters submitted
                  to the Board of Directors. Votes cast in favor of the
                  amendment to the Bylaws were 493,850 (or 83.0%), 97,000 shares
                  voting against (or 16.3%), and 4,181 shares not voting (or
                  0.7%).

         D.       The stockholders approved two resolutions which (i) directs
                  the Board of Directors of the Company to retire the shares of
                  common stock of the Company redeemed from the affiliates of
                  Merrill Lynch Capital Partners, Inc., and (ii) to reduce the
                  number of authorized shares of common stock of the Company to
                  an appropriate amount, taking into consideration the Company's
                  outstanding obligations with respect to its common stock and
                  the recent redemptions of the Affiliates of Merrill Lynch
                  Capital partners, Inc. Votes cast in favor of the resolutions
                  were 493,850 for (or 83.0%), 97,000 shares voting against (or
                  16.3%), and 4,181 shares not voting (or 0.7%).

         E.       The Stockholders unanimously appointed W. James Raleigh as a
                  Director Emeritus of the Company.

         F.       The stockholders did not approve a motion placed before them
                  that would have required that any Company action that dilutes
                  or has the potential to dilute the interest of the
                  stockholders must be presented to the stockholders for a vote,
                  with a two-thirds majority necessary to implement such action,
                  and that such action must be supported by a fairness opinion.
                  Votes cast in favor of the motion were 134,000 (or 22.5%),
                  441,850 votes against (or 74.3%), and 19,181 shares not voting
                  (or 3.2%).


                                       14
<PAGE>   15

Item 5.  Other Information

         None

Item 6.  Exhibits and Reports on Form 8-K

         a)       Exhibits

                  3.1      Amendment to the Bylaws of the Company.

                  4.1      Amendment No. 3 dated May 31, 2000 to Amended and
                           Restated Loan and Security Agreement dated as of May
                           28, 1999 between CMI Industries, Inc. and BankBoston,
                           N.A., as Agent for the Lenders.

                  10.1     Employment Agreement dated July 7, 2000 between the
                           Company and Joseph L. Gorga.

                  10.2     Employment Agreement dated July 7, 2000 between the
                           Company and James A. Ovenden.

                  27.1     Financial Data Schedule. (for SEC use only)

         b)       Reports on Form 8-K

                  None


                                       15
<PAGE>   16

                             SIGNATURE OF REGISTRANT

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.


                                    CMI INDUSTRIES, INC.


Date:   August 14, 2000             By /s/ JOSEPH L. GORGA
                                       ----------------------------------------
                                        Joseph L. Gorga
                                        President and Chief Executive Officer


Date:   August 14, 2000             By  /s/ JAMES A OVENDEN
                                       ----------------------------------------
                                        James A. Ovenden
                                        Executive Vice President
                                        and Chief Financial Officer


                                       16
<PAGE>   17

                                INDEX TO EXHIBITS

<TABLE>
<CAPTION>
      Exhibit No.                  Description
      -----------                  -----------

      <S>         <C>

         3.1      Amendment to the Bylaws of the Company.

         4.1      Amendment No. 3 dated May 31, 2000 to Amended and Restated
                  Loan and Security Agreement dated as of May 28, 1999 between
                  CMI Industries, Inc. and BankBoston, N.A., as Agent for the
                  Lenders.

         10.1     Employment Agreement dated July 7, 2000 between the Company
                  and Joseph L. Gorga.

         10.2     Employment Agreement dated July 7, 2000 between the company
                  and James A. Ovenden.

         27.1     Financial Data Schedule. (for SEC use only)
</TABLE>


                                       17