<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

[ ]    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 1-13474
                              FLORSHEIM GROUP INC.
             (Exact name of registrant as specified in its charter)

              Delaware                                        36-3520923
              --------                                        ----------
  (State or other jurisdiction                              (I.R.S. Employer
of incorporation or organization)                          Identification No.)

200 North LaSalle Street, Chicago, Illinois                       60601-1014
--------------------------------------------                      ----------
  (Address of principal executive offices)                        (Zip Code)

        Registrant's telephone number, including area code (312) 458-2500
                                                            -------------

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

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
requirement for the past 90 days. Yes [x] No [ ]

                      APPLICABLE ONLY TO CORPORATE ISSUERS:


Number of shares outstanding of each of the issuer's classes of common stock as
of August 1, 2000.

                8,483,651 Shares Common Stock, without par value


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


<PAGE>   2
                          PART I FINANCIAL INFORMATION


ITEM 1. FINANCIAL STATEMENTS


           Condensed Consolidated Balance Sheet:

                January 1, 2000 and July 1, 2000


           Condensed Consolidated Statement of Operations and Comprehensive
           Earnings:

                Three Months Ended July 3, 1999 and July 1, 2000

                Six Months Ended July 3, 1999 and July 1, 2000


           Condensed Consolidated Statement of Cash Flows:

                Six Months Ended July 3, 1999 and July 1, 2000

           Notes to Condensed Consolidated Financial Statements

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

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK





                                       2
<PAGE>   3
                              FLORSHEIM GROUP INC.
                      CONDENSED CONSOLIDATED BALANCE SHEET
                                 (in thousands)


<TABLE>
<CAPTION>
                                                    January 1,    July 1,
                                                       2000         2000
                                                    ----------   ---------
                        ASSETS                                   (Unaudited)
<S>                                                 <C>          <C>
Current assets:
     Cash and cash equivalents                      $   5,675    $   4,119
     Accounts receivable, net                          30,163       27,446
     Inventories                                       70,964       68,765
     Other current assets                              11,082       11,470
                                                    ---------    ---------
       Total current assets                           117,884      111,800

Property, plant and equipment, net                     32,525       30,962
Deferred income taxes                                  16,623       19,643
Other assets                                           30,320       32,413
                                                    ---------    ---------

     Total assets                                   $ 197,352    $ 194,818
                                                    =========    =========

         LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
     Current portion of long-term debt              $  23,767    $  16,500
     Accounts payable and accrued expenses             24,842       26,091
                                                    ---------    ---------
       Total current liabilities                       48,609       42,591

Bank credit facility                                   65,000       73,748
Other long-term debt                                   18,412       18,412
Other long-term liabilities                            20,683       20,655
                                                    ---------    ---------
       Total liabilities                              152,704      155,406

Shareholders' equity:
     Common stock                                       8,484        8,484
     Paid in capital                                   50,644       50,644
     Accumulated comprehensive loss-
       Cumulative translation adjustment               (2,760)      (3,132)
     Accumulated deficit                              (11,720)     (16,584)
                                                    ---------    ---------
         Total shareholders' equity                    44,648       39,412
                                                    ---------    ---------

       Total liabilities and shareholders' equity   $ 197,352    $ 194,818
                                                    =========    =========
</TABLE>


     See accompanying notes to condensed consolidated financial statements.



                                       3
<PAGE>   4
                              FLORSHEIM GROUP INC.
    CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE EARNINGS
                                   (Unaudited)
                      (In thousands, except per share data)


                                             Three months      Three months
                                                ended             ended
                                             July 3, 1999      July 1, 2000
                                             ------------      ------------
Net sales                                      $ 62,544           $ 51,560
Cost of sales                                    32,797             27,145
                                               --------           --------

Gross profit                                     29,747             24,415
Selling, general and administrative expenses     27,099             23,427
Non-recurring expenses                            1,100              1,976
                                               --------           --------

Earnings (loss) from operations                   1,548               (988)
Interest expense, net                             2,430              3,166
Other (income) expense, net                          23               (436)
                                               --------           --------

Loss before income taxes                           (905)            (3,718)
Income tax benefit                                 (318)            (1,331)
                                               --------           --------

Net loss                                           (587)            (2,387)

Other comprehensive earnings (loss) -
     Foreign currency translation adjustment        181                (60)
                                               --------           --------

Comprehensive loss                             $   (406)          $ (2,447)
                                               ========           ========

Loss per share:
     Basic                                     $  (0.07)          $  (0.28)
                                               ========           ========

     Diluted                                   $  (0.07)          $  (0.28)
                                               ========           ========



     See accompanying notes to condensed consolidated financial statements.



                                       4
<PAGE>   5
                              FLORSHEIM GROUP INC.
    CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE EARNINGS
                                   (Unaudited)
                      (In thousands, except per share data)


<TABLE>
<CAPTION>
                                               Six months      Six months
                                                 ended           ended
                                              July 3, 1999    July 1, 2000
                                              ------------    ------------
<S>                                           <C>             <C>
Net sales                                      $ 126,069         $ 107,781
Cost of sales                                     66,199            59,355
                                               ---------         ---------

Gross profit                                      59,870            48,426
Selling, general and administrative expenses      53,273            47,897
Non-recurring expenses                             1,100             2,899
                                               ---------         ---------

Earnings (loss) from operations                    5,497            (2,370)
Interest expense, net                              4,827             6,190
Other (income) expense, net                           49            (1,007)
                                               ---------         ---------

Earnings (loss) before income taxes                  621            (7,553)
Income tax expense (benefit)                         229            (2,689)
                                               ---------         ---------

Net earnings (loss)                                  392            (4,864)

Other comprehensive earnings (loss)-
     Foreign currency translation adjustment          43              (372)
                                               ---------         ---------

Comprehensive earnings (loss)                  $     435         $  (5,236)
                                               =========         =========

Earnings (loss) per share:
     Basic                                     $    0.05         $   (0.57)
                                               =========         =========

     Diluted                                   $    0.05         $   (0.57)
                                               =========         =========
</TABLE>


     See accompanying notes to condensed consolidated financial statements.



                                       5
<PAGE>   6


                              FLORSHEIM GROUP INC.
                 CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
                                   (Unaudited)
                                 (In thousands)


<TABLE>
<CAPTION>
                                                                   Six months  Six months
                                                                     ended       ended
                                                                     July 3,    July 1,
                                                                      1999        2000
                                                                   ---------  -----------
<S>                                                                <C>        <C>
Cash flows from operating activities:
   Net earnings (loss)                                             $   392    $(4,864)
   Adjustments to reconcile net earnings (loss) to
    net cash used in operating activities:
       Gain on disposal of assets                                     (380)      (619)
       Depreciation and amortization                                 3,153      3,596
       Deferred income taxes                                           (35)    (2,708)
       Noncash interest expense                                        216        548
       (Increase) decrease in receivables                           (3,239)     3,427
       (Increase) decrease in inventories                             (469)     2,199
       Increase in prepaid expenses and other assets                (1,863)    (3,651)
       Decrease in accounts payable and
        other accrued expenses                                      (1,414)    (1,151)
       Decrease in other long-term liabilities                         (67)       (28)
                                                                   -------    -------

Net cash used in operating activities                               (3,706)    (3,251)
                                                                   -------    -------

Cash flows from investing activities:
   Proceeds from the disposal of assets                                380        691
   Additions to property, plant and equipment                       (2,807)      (477)
                                                                   -------    -------

Net cash (used in) provided by investing activities                 (2,427)       214
                                                                   -------    -------

Cash flows from financing activities:

   Net borrowing under (reduction of ) revolving credit facility     7,000     (1,623)
   Increase in other long-term debt                                   --        3,104
                                                                   -------    -------

Net cash provided by financing activities                            7,000      1,481
                                                                   -------    -------

Net increase (decrease) in cash and cash equivalents                   867     (1,556)
Cash and cash equivalents at beginning of period                     6,931      5,675
                                                                   -------    -------

Cash and cash equivalents at end of period                         $ 7,798    $ 4,119
                                                                   =======    =======

Supplemental disclosure:
   Cash payments for income taxes, net                             $   347    $   541
   Cash payments for interest                                      $ 4,537    $ 5,616
</TABLE>



     See accompanying notes to condensed consolidated financial statements.


                                       6
<PAGE>   7
                              FLORSHEIM GROUP INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                  July 1, 2000
                                   (Unaudited)
                             (Dollars in thousands)


(1) BASIS OF PRESENTATION

    The accompanying unaudited condensed consolidated financial statements of
    Florsheim Group Inc. ("Florsheim" or the "Company") have been prepared in
    accordance with generally accepted accounting principles for interim
    financial information and with the instructions to Form 10-Q and Article 10
    of Regulation S-X. Accordingly, they do not include all of the information
    and notes required by generally accepted accounting principles for complete
    financial statements. In the opinion of management, all adjustments, except
    as otherwise disclosed, consisting of normal recurring adjustments,
    considered necessary for a fair presentation have been included. Operating
    results for the three month and six month periods ended July 1, 2000 are not
    necessarily indicative of the results that may be expected for the year
    ending December 30, 2000.

    The balance sheet at January 1, 2000 has been derived from the audited
    consolidated financial statements at that date, but does not include all of
    the information and notes required by generally accepted accounting
    principles for complete financial statements.

    For further information, refer to the consolidated financial statements and
    notes thereto included in the Company's annual report on Form 10-K for the
    fiscal year ended January 1, 2000.

(2) INVENTORIES

    Inventories are summarized as follows:

                                              January 3,            July 1,
                                                2000                  2000
                                             -------------        -------------

              Retail merchandise             $      34,329        $      34,883
              Finished products                     32,682               32,880
              Raw materials                          3,953                1,002
                                             -------------        -------------
                                             $      70,964        $      68,765
                                             =============        =============


(3) LONG TERM DEBT

    In May 2000, the Company amended its bank credit facility, resulting in a
    waiver of the financial covenant related to the EBITDA to interest expense
    ratio for the quarter ended April 1, 2000. In addition, the amendment reset
    this covenant and established new financial covenants commencing with the
    quarter ending July 1, 2000. The new covenants include additional
    requirements related to the ratios of senior debt to EBITDA and total


                                       7
<PAGE>   8
                              FLORSHEIM GROUP INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                  July 1, 2000
                                   (Unaudited)
                             (Dollars in thousands)

    debt to EBITDA. The Company was in compliance with these financial covenants
    at July 1, 2000.

(4) NON-RECURRING EXPENSES

    The Company recorded a $1,976 pretax charge in the quarter ended July 1,
    2000. The charge consisted of severance costs for approximately 18 people,
    located primarily at the Company's corporate headquarters and a provision of
    $700 for customer deductions taken against prior periods accounts
    receivable. In addition, the Company recorded a $923 pretax charge in the
    quarter ended April 1, 2000. The charge included $627 for costs associated
    with the downsizing of the Company's corporate headquarters space, including
    the write-off of certain leasehold improvements, lease termination costs and
    moving expenses. Of these costs, $310 were non-cash. The charge also
    included $296 for severance costs for approximately 20 people located
    primarily at the Company's corporate headquarters.

    The following table summarizes the costs reflected in the Condensed
    Consolidated Financial Statements as of and for the six months ended July 1,
    2000:


<TABLE>
<CAPTION>
                                     Accrual                           Amounts         Accrual
                                   Balance at         Additional       Charged        Balance at
                                 January 1, 2000      Provision       to Accrual     July 1, 2000
                                 ---------------      ----------      ----------     ------------
<S>                             <C>                   <C>             <C>            <C>
Resignation/Strategic Study
  Legal and professional fees       $   254               $  --         $   (87)             167
  Employee related expenses             365                  --            (224)             141
                                    -------               -------       -------          -------
                                        619                  --            (311)             308
                                    -------               -------       -------          -------

Cape Girardeau Closing
  Inventory write-offs                  610                   155          (460)             305
  Plant and equipment costs             437                  (250)         (107)              80
  Employee related expenses             566                    95          (572)              89
                                    -------               -------       -------          -------
                                      1,613                  --          (1,139)             474
                                    -------               -------       -------          -------

Facility Downsizing/Other
  Inventory write-offs                  300                  --            (149)             151
  Receivables allowance                 365                   700           (78)             987
  Facilities charges                    276                   627          (752)             151
  Employee related expenses             195                 1,572          (384)           1,383
                                    -------               -------       -------          -------
                                      1,136                 2,899        (1,363)           2,672
                                    -------               -------       -------          -------

         Total                      $ 3,368               $ 2,899       $(2,813)         $ 3,454
                                    =======               =======       =======          =======
</TABLE>



                                       8
<PAGE>   9
                              FLORSHEIM GROUP INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                  July 1, 2000
                                   (Unaudited)
                             (Dollars in thousands)

(5) EARNINGS PER SHARE

    The Company presents basic and diluted earnings per share. Basic earnings
    per share excludes dilution and is computed by dividing income available to
    common stockholders by the weighted average number of common shares
    outstanding for the period. Diluted earnings per share reflects the
    potential dilution that could occur if securities or other contracts to
    issue common stock were exercised. Basic and diluted earnings per share do
    not include securities in instances where they would be antidilutive.

    The following table provides a reconciliation of the weighted average shares
    outstanding used in calculating basic and diluted earnings per share (in
    000's):


<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>
Weighted average shares
  outstanding - basic                8,454      8,484      8,454       8,484
Assumed exercise of stock options     --         --           59        --
                                     -----      -----      -----       -----
Weighted average shares
  outstanding - diluted              8,454      8,484      8,513       8,484
                                     =====      =====      =====       =====
</TABLE>



                                       9
<PAGE>   10
                              FLORSHEIM GROUP INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                  July 1, 2000
                                   (Unaudited)
                             (Dollars in thousands)

(6) BUSINESS SEGMENT INFORMATION

    Operating segment information is as follows:


<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
  U.S. Wholesale                  $  25,263    $  19,015    $  51,870    $  43,689
  U.S. Retail                        25,971       22,329       50,983       43,734
  International                      11,310       10,216       23,216       20,358
                                  ---------    ---------    ---------    ---------
                                  $  62,544    $  51,560    $ 126,069    $ 107,781
                                  =========    =========    =========    =========

Earnings (Loss) from Operations
  U.S. Wholesale                  $   2,067       (1,161)       5,908          112
  U.S. Retail                        (1,136)      (1,500)      (1,791)      (4,912)
  International                         617        1,673        1,380        2,430
                                  ---------    ---------    ---------    ---------
                                  $   1,548    $    (988)   $   5,497    $  (2,370)
                                  =========    =========    =========    =========
</TABLE>


<TABLE>
<CAPTION>
                                  January 1,           July 1,
                                     2000               2000
                                 ------------         ---------
<S>                               <C>               <C>
         Total Assets
         U.S. Wholesale           $ 105,956         $ 108,234
         U.S. Retail                 69,112            64,221
         International               22,284            22,363
                                  ---------         ---------
                                  $ 197,352         $ 194,818
                                  =========         =========
</TABLE>
U.S. Wholesale includes certain corporate expenses and assets which are not
charged to other reportable segments. The U. S. Wholesale segment includes
$2,899 of non-recurring expenses in the six months ended July 1, 2000, of which
$1,976 were recorded in the second quarter and $923 in the first quarter. The
expenses relate to severance, downsizing and a provision for customer deductions
taken against prior periods accounts receivable. Comparatively, the periods
ended July 3, 1999 include $1,100 of non-recurring expenses recorded in the
second quarter of 1999 related to the resignation of former CEO and the
evaluation of strategic alternatives.




                                       10
<PAGE>   11
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS


RESULTS OF OPERATIONS

THREE MONTHS ENDED JULY 1, 2000 COMPARED TO THE THREE MONTHS ENDED JULY 3, 1999

Net sales for the three months ended July 1, 2000 were $51.6 million, down $11.0
million, or 17.6%, as compared to the three months ended July 3, 1999. U.S.
Wholesale sales were $19.0 million in 2000 compared to $25.3 million in 1999,
with all channels of distribution showing declines. Orders were down
approximately $13.7 million or 43% in the second quarter of 2000 compared to the
1999 period, reflecting the weakness in the footwear retail market. Net sales of
U.S. Wholesale's Golf products were $2.2 million below the second quarter of
1999 due to uncertainty in the market place regarding the potential sale of the
business. U.S. Retail net sales decreased $3.6 million, or 14.0% to $22.3
million, primarily as a result of store closings in the second half of 1999, but
also due to weakness in the retail market for footwear. U.S. Specialty Stores
same store sales decreased 1.7% versus the comparable 1999 period. International
sales decreased $1.1 million to $10.2 million, due primarily to lower sales in
Canada, and the impact of currency rates in Australia.

Gross profit for the second quarter 2000 was $24.4 million or 47.4% of net
sales, as compared to 47.6% of net sales for the second quarter 1999. Gross
profit margin was negatively impacted by the lower sales volume in each of the
businesses and the sale of close out products, partially offset by higher
earnings by the Company's India joint venture.

Selling, general and administrative expenses for the second quarter 2000 were
$23.4 million, a decrease of $3.7 million from the second quarter 1999. Selling,
general and administrative expenses for the second quarter 2000 were 45.4% of
net sales, an increase from 43.3% of net sales for the second quarter of 1999.
The decrease in expense was the result of cost reduction programs initiated in
the fourth quarter of 1999 affecting marketing, personnel and occupancy costs,
partially offset by increased depreciation expense and costs associated with the
information technology function. The cost reductions were not sufficient to
offset the effect of the reduced sales volume.

Non-recurring expenses of $2.0 million were recorded in the second quarter of
2000. The charge consisted of $1.3 million related to severance and related
expenses for approximately 18 people at the Company's corporate headquarters and
$0.7 million as provision for customer deductions taken against prior
periods accounts receivable. The second quarter of 1999 included $1.1 million of
non-recurring expenses for costs associated with the resignation of the
Company's former Chief Executive Officer and costs related to an evaluation of
strategic alternatives by the Company's financial advisor.

Interest expense for the second quarter 2000 was $3.2 million as compared to the
second quarter 1999 amount of $2.4 million. This increase is due to increased
borrowings during the second quarter 2000 as compared to the second quarter 1999
and an increase in the weighted average interest rate under the Company's new
credit facility.


                                       11
<PAGE>   12
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

Other income for the three months ended July 1, 2000 includes income of $0.5
million related to a refund of real estate taxes for the period 1991 to 1993.

SIX MONTHS ENDED JULY 1, 2000 COMPARED TO SIX MONTHS ENDED JULY 3, 1999

Net sales for the six months ended July 1, 2000 were $107.8 million, down $18.3
million, or 14.5%, as compared to the six months ended July 3, 1999. U.S.
Wholesale net sales decreased $8.2 million, or 15.8%. $6.2 million of the
decrease occurred in the second quarter, and is attributed to the weakness in
orders during the quarter, weakness in the retail footwear market and decline in
the Company's Golf product line as a result of uncertainty regarding the
potential sale of the business. Results for the first quarter were negatively
impacted by inventory problems related to the implementation of the Company's
new wholesale computer software system in 1999. The system problems resulted in
reduced shipments to wholesale customers as well as the Company's U.S. Retail
business during the first two months of 2000, as the Company was unable to
satisfy customer orders. The inventory position was much improved by the end of
March 2000. U.S. Retail net sales decreased $7.2 million, or 14.2%, as a result
of store closings and the inventory problems at U.S. Wholesale. Weakness in the
retail footwear market also affected sales in the first six months of 2000, with
U.S. Specialty stores reporting a decline in same store sales of 1.5%.
International net sales were $23.2 million, down $2.9 million from the 1999
period. All units in International reported lower sales, with the largest
decline in Canada, where there was a bankruptcy by a large customer in the
second half of 1999.

Gross profit for the six months ended July 1, 2000 was $48.4 million or 45.0% of
net sales, as compared to $59.9 million or 47.5% of net sales for the second
quarter 1999. The decline was primarily due to the reduced sales volume. In
addition to the reduced volume, margin rates were lower in U.S. Wholesale, where
sales of the Golf product line declined from the prior year and U.S. Retail,
where promotions reduced the margin rate. Gross margin rates also continue to
decline as a greater percentage of the Company's revenues shift to U.S.
Wholesale versus U.S. Retail, which typically carries higher margins.

Selling, general and administrative expenses for the six months ended July 1,
2000 were $47.9 million, a decrease of $5.4 million, or 10.1%, compared to the
1999 period. Selling, general and administrative expenses for 2000 were 44.4% of
net sales, an increase from 42.3% of net sales for 1999. The decrease in expense
was the result of cost reduction programs initiated in the fourth quarter of
1999 affecting marketing, personnel and occupancy costs, partially offset by
increased depreciation expense and costs associated with the information
technology function. The cost reductions were not sufficient to offset the
effect of the reduced sales volume resulting in increased cost as a percent to
sales.

Non-recurring expenses of $2.9 million were recorded in the six months ended
July 1, 2000. The charge included $1.6 million related to severance, $0.6
million related to the downsizing of the Company's corporate headquarters space
and $0.7 million as provision for customer deductions taken against prior
periods accounts receivable. The 1999 period included $1.1 million of non-



                                       12
<PAGE>   13


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

recurring expenses for costs associated with the resignation of the Company's
former Chief Executive Officer and costs related to an evaluation of strategic
alternatives by the Company's financial advisor.

Interest expense for the six months ended July 1, 2000 was $6.2 million, as
compared to $4.8 million in 1999. This increase is due to increased borrowings
and an increase in the weighted average interest rate under the Company's
current credit facility.

Other income for the six months ended July 1, 2000 includes $0.6 million
related to the gain from the sale of the Company's Cape Girardeau, Missouri,
manufacturing facility, which was closed in December 1999. The sale of the
facility was completed in January 2000. In addition, the company recorded income
of $0.5 million related to a refund of real estate taxes for the period 1991 to
1993.

LIQUIDITY AND CAPITAL RESOURCES

The Company's cash needs are primarily for working capital to support its
operations and its inventory requirements, and cash for interest payments on
borrowings under debt facilities. The Company's ability to fund its activities
is directly dependent on sales, its ability to effectively manage its inventory
and working capital needs and its ability to obtain sufficient external
financing. In the three months ended July 1, 2000, the Company continued to
reduce its overall corporate administrative expenses.

Working capital at July 1, 2000 was $69.2 million, as compared to $69.3 million
at January 1, 2000. Net cash used in operations for the six months ended July 1,
2000 was $3.3 million, as compared to $3.7 million of cash used in operations
during the six months ended July 3, 1999. The improvement reflects efforts to
reduce levels of inventory and accounts receivable, which was offset by the net
loss during six months ended July 1, 2000.

Net cash from investing activities during the six months ended July 1, 2000 was
$0.2 million, as compared to $2.4 million of cash used during the six months
ended July 3, 1999. Spending related to the Company's information technology
initiatives was reduced from the prior year as the significant phases of the SAP
implementation have been completed as well as reduced capital spending at U.S.
Retail.

Net cash provided by financing activities was $1.5 million for the six months
ended July 1, 2000, as compared to $7.0 million for the six months ended July 3,
1999. The $1.5 million consisted of a $1.6 million reduction of net borrowings
under the revolving credit facility which was offset by $3.1 million of
additional borrowings under the previously announced credit facility entered
into by the company's Australian subsidiary in January 2000.

In May 2000, the Company amended its bank credit facility, resulting in a waiver
of the financial covenant related to the ratio of EBITDA to interest expense for
the quarter ended April 1, 2000. In addition, the amendment reset this covenant
and established new financial covenants commencing with the quarter ended July
1, 2000. The new covenants include additional requirements related to the ratios
of senior debt to EBITDA and total debt to EBITDA. The Company was in compliance
with the financial covenants at July 1, 2000.



                                       13
<PAGE>   14
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

RECENT ACCOUNT POLICIES

Statement of Financial Accounting Standards No. 133, "Accounting Instruments and
Hedging Activities" ("SFAS No. 133") requires companies to recognize all
derivative instruments as assets and liabilities in the balance sheet and to
measure those instruments at fair value. SFAS No. 133 initially required
adoption by January 1, 2000. However, Statement of Financial Standards No. 137
"Accounting for Derivative Financial Instruments and Hedging Activities -
Deferral of Effective Date of SFAS No. 133 " issued in June 1999 and Statement
of Financial Standards No. 138 "Accounting for Certain Derivative Instruments
and Hedging Activities - an amendment to SFAS No. 133" issued in June 2000
requires adoption in fiscal quarters beginning after June 15, 2000. The Company
anticipates that the new standards will have no material impact on the results
of operations and financial condition.

FORWARD LOOKING STATEMENTS

When used in this discussion, the words "believes" and "expects" and similar
expressions are intended to identify forward-looking statements. Such statements
are subject to certain risks and uncertainties, over which the Company has no
control, which could cause actual results to differ materially from those
projected. Readers are cautioned not to place reliance on these forward-looking
statements, which speak only as of the date hereof. The Company undertakes no
obligations to republish revised forward-looking statements to reflect events or
circumstances after the date thereof or to reflect the occurrence of
unanticipated events. Readers are also urged to carefully review and consider
the various disclosures made by the Company in this report, as well as the
Company's periodic reports with the Securities Exchange Commission.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS

There have been no material changes in the Company's market risk during the six
month period ended July 1, 2000. For additional information, refer to Item 7A in
the Company's Annual Report on form 10-K for the year ended January 1, 2000.




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<PAGE>   15
                            PART II OTHER INFORMATION


Item 4. Exhibits and Reports on Form 8-K

(a)      The following exhibits are filed as part of this report:

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


                  27       Financial Data Schedule

(b)      Form 8-K was not required to be filed during the quarter ended July 1,
         2000.




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<PAGE>   16

                                    SIGNATURE

         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.

                                                 FLORSHEIM GROUP INC.
                                                     (Registrant)




                                                 By /s/ Thomas P. Polke
                                                    ----------------------------
                                                    Thomas P. Polke
                                                    Executive Vice-President,
                                                    Chief Financial Officer



Date:  August 15, 2000




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