FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549



(Mark one)

[X]  QUARTERLY  REPORT  PURSUANT  TO  SECTION  13 OR 15 (D)  OF  THE  SECURITIES
     EXCHANGE  ACT OF 1934
     For the  quarterly  period  ended  June  30,  2001 or
                                        ---------------

     TRANSITION  REPORT  PURSUANT  TO  SECTION  13 OR 15 (D)  OF THE  SECURITIES
     EXCHANGE  ACT OF  1934
     For the  transition  period  from              to
                                       ------------     ------------

     Commission file number I-91
                            ----


                     Furniture Brands International, Inc.
-------------------------------------------------------------------------------
           (Exact name of registrant as specified in its charter)

            Delaware                                       43-0337683
----------------------------------                     ------------------------
  (State or other jurisdiction of                         (I.R.S. Employer
   incorporation or organization)                          Identification No.)

 101 South Hanley Road, St. Louis, Missouri                      63105
--------------------------------------------                -------------------
  (Address of principal executive offices)                      (Zip Code)

Registrant's telephone number, including area code           (314) 863-1100
                                                            -------------------

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

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

                      50,403,355 Shares as of July 31, 2001
                      -------------------------------------

<PAGE>




                          PART I FINANCIAL INFORMATION
                          ----------------------------


Item 1.  Financial Statements

Consolidated Financial Statements for the quarter ended June 30, 2001.

                  Consolidated Balance Sheets

                  Consolidated Statements of Operations:

                         Three Months Ended June 30, 2001
                         Three Months Ended June 30, 2000

                         Six Months Ended June 30, 2001
                         Six Months Ended June 30, 2000

                  Consolidated Statements of Cash Flows:

                         Six Months Ended June 30, 2001
                         Six Months Ended June 30, 2000

                  Notes to Consolidated Financial Statements

The financial statements are unaudited,  but include all adjustments (consisting
of normal recurring  adjustments)  which the management of the Company considers
necessary for a fair presentation of the results of the period.  The results for
the  three  months  and six  months  ended  June 30,  2001  are not  necessarily
indicative of the results to be expected for the full year.


<PAGE>

<TABLE>
<CAPTION>

                      FURNITURE BRANDS INTERNATIONAL, INC.
                           CONSOLIDATED BALANCE SHEETS
                             (Dollars in thousands)
                                   (Unaudited)

                                                                                               June 30,              December 31,
                                                                                                  2001                      2000
                                                                                           -----------               -----------
ASSETS

Current assets:
<S>                                                                                        <C>                       <C>
  Cash and cash equivalents.......................                                         $     8,737               $    14,606
  Receivables, less allowances of $23,698
    ($23,075 at December 31, 2000)................                                             320,450                   351,804
  Inventories.........................(Note 1)....                                             288,687                   294,454
  Prepaid expenses and other current assets.......                                              30,970                    30,717
                                                                                           -----------               -----------
    Total current assets..........................                                             648,844                   691,581
                                                                                           -----------               -----------

Property, plant and equipment.....................                                             598,151                   590,342
  Less accumulated depreciation...................                                             327,164                   287,107
                                                                                           -----------               -----------
    Net property, plant and equipment.............                                             270,987                   303,235
                                                                                           -----------               -----------

Intangible assets.................................                                             283,119                   289,895
Other assets......................................                                              24,498                    20,127
                                                                                           -----------               -----------
                                                                                           $ 1,227,448               $ 1,304,838
                                                                                           ===========               ===========
LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
  Accrued interest expense........................                                         $     3,773               $     7,646
  Accounts payable and other accrued expenses.....                                             127,559                   135,472
                                                                                           -----------               -----------
    Total current liabilities.....................                                             131,332                   143,118
                                                                                           -----------               -----------

Long-term debt....................................                                             374,000                   462,000
Other long-term liabilities.......................                                             105,410                   115,815

Shareholders' equity:
  Preferred stock, authorized 10,000,000
    shares, no par value - issued, none...........                                                -                         -
  Common stock, authorized 100,000,000 shares,
    $1.00 stated value - issued 52,277,066
    shares at June 30, 2001 and
    December 31, 2000.............................                                              52,277                    52,277
  Paid-in capital.................................                                             113,903                   118,360
  Retained earnings...............................                                             483,801                   462,473
  Accumulated other comprehensive income.(Note 3).                                               3,103                       -
  Treasury stock at cost (1,923,520 shares at
    June 30, 2001 and 2,601,759 shares at
    December 31, 2000)............................                                             (36,378)                  (49,205)
                                                                                           -----------               -----------
    Total shareholders' equity....................                                             616,706                   583,905
                                                                                           -----------               -----------
                                                                                           $ 1,227,448               $ 1,304,838
                                                                                           ===========               ===========
See accompanying notes to consolidated financial statements.
</TABLE>



<PAGE>

<TABLE>
<CAPTION>

                      FURNITURE BRANDS INTERNATIONAL, INC.
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                  (Dollars in thousands except per share data)
                                   (Unaudited)

                                                                                           Three Months              Three Months
                                                                                                  Ended                     Ended
                                                                                                June 30,                  June 30,
                                                                                                   2001                      2000
                                                                                           ------------              ------------

<S>                                                                                        <C>                       <C>
Net sales......................................                                            $    459,648              $    533,079

Costs and expenses:
  Cost of operations...........................                                                 335,034                   380,989

  Selling, general and administrative expenses.                                                  84,866                    81,331

  Depreciation and amortization................                                                  14,765                    15,298

  Asset impairment charges........(Note 5).....                                                  18,000                       -
                                                                                           ------------              ------------

Earnings from operations.......................                                                   6,983                    55,461

Interest expense...............................                                                   5,539                     9,308

Other income, net..............................                                                     610                       959
                                                                                           ------------              ------------

Earnings before income tax expense and
  extraordinary item...........................                                                   2,054                    47,112

Income tax expense.............................                                                     407                    16,969
                                                                                           ------------              ------------

Earnings before extraordinary item.............                                                   1,647                    30,143

Extraordinary item - early extinguishment of
  debt, net of income tax benefit..............                                                     -                      (2,522)
                                                                                           ------------              ------------

Net earnings...................................                                            $      1,647              $     27,621
                                                                                           ============              ============

Net earnings per common share - basic:
  Earnings before extraordinary item...........                                                  $ 0.03                    $ 0.61
  Extraordinary item - early extinguishment
    of debt....................................                                                     -                       (0.05)
                                                                                                 ------                    ------

Net earnings per common share - basic..........                                                  $ 0.03                    $ 0.56
                                                                                                 ======                    ======

Net earnings per common share - diluted:
  Earnings before extraordinary item...........                                                  $ 0.03                    $ 0.60
  Extraordinary item - early extinguishment
    of debt....................................                                                     -                       (0.05)
                                                                                                 ------                    ------

Net earnings per common share - diluted........                                                  $ 0.03                    $ 0.55
                                                                                                 ======                    ======

Weighted average common and common equivalent shares outstanding (Note 2):
  Basic........................................                                              50,295,895                49,463,669
                                                                                           ============              ============

  Diluted......................................                                              51,214,184                50,460,912
                                                                                           ============              ============

See accompanying notes to consolidated financial statements.
</TABLE>


<PAGE>
<TABLE>
<CAPTION>
                      FURNITURE BRANDS INTERNATIONAL, INC.
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                  (Dollars in thousands except per share data)
                                   (Unaudited)

                                                                                        Six Months                Six Months
                                                                                             Ended                     Ended
                                                                                           June 30,                  June 30,
                                                                                              2001                      2000
                                                                                        ----------                ----------

<S>                                                                                     <C>                       <C>
Net sales......................................                                         $  965,830                $1,097,026

Costs and expenses:
  Cost of operations...........................                                            705,450                   785,708

  Selling, general and administrative expenses.                                            169,277                   168,294

  Depreciation and amortization................                                             30,023                    30,847

  Asset impairment charges........(Note 5).....                                             18,000                       -
                                                                                        ----------                ----------

Earnings from operations.......................                                             43,080                   112,177

Interest expense...............................                                             12,308                    18,917

Other income, net..............................                                              1,419                     1,694
                                                                                        ----------                ----------

Earnings before income tax expense and
  extraordinary item...........................                                             32,191                    94,954

Income tax expense.............................                                             10,863                    34,211
                                                                                        ----------                ----------

Earnings before extraordinary item.............                                             21,328                    60,743

Extraordinary item - early extinguishment of
  debt, net of income tax benefit..............                                                -                      (2,522)
                                                                                        ----------                ----------

Net earnings...................................                                         $   21,328                $   58,221
                                                                                        ==========                ==========

Net earnings per common share - basic:
  Earnings before extraordinary item...........                                             $ 0.43                    $ 1.23
  Extraordinary item - early extinguishment
    of debt....................................                                                -                       (0.05)
                                                                                            ------                    ------

Net earnings per common share - basic..........                                             $ 0.43                    $ 1.18
                                                                                            ======                    ======

Net earnings per common share - diluted:
  Earnings before extraordinary item...........                                             $ 0.42                    $ 1.21
  Extraordinary item - early extinguishment
    of debt....................................                                                -                       (0.05)
                                                                                            ------                    ------

Net earnings per common share - diluted........                                             $ 0.42                    $ 1.16
                                                                                            ======                    ======

Weighted average common and common equivalent shares outstanding (Note 2):
  Basic........................................                                         50,159,494                49,418,712
                                                                                        ==========                ==========

  Diluted......................................                                         51,148,911                50,405,810
                                                                                        ==========                ==========

See accompanying notes to consolidated financial statements.
</TABLE>


<PAGE>
<TABLE>
<CAPTION>
                      FURNITURE BRANDS INTERNATIONAL, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                             (Dollars in thousands)
                                   (Unaudited)

                                                                                               Six Months          Six Months
                                                                                                    Ended               Ended
                                                                                                  June 30,            June 30,
                                                                                                     2001                2000
                                                                                               ----------          ----------

   Cash flows from operating activities:
<S>                                                                                            <C>                 <C>
     Net earnings.........................................                                     $   21,328          $   58,221
     Adjustments to reconcile net earnings to net cash
       provided by operating activities:
         Net loss on early extinguishment of debt.........                                            -                 2,522
         Depreciation of property, plant and equipment....                                         23,993              24,817
         Amortization of intangible and other assets......                                          6,030               6,030
         Asset impairment charges.........................                                         18,000                 -
         Noncash interest and other expense...............                                            707                 888
         (Increase) decrease in receivables...............                                         31,354             (15,345)
         (Increase) decrease in inventories...............                                          5,767             (25,546)
         (Increase) decrease in prepaid expenses and
           other assets...................................                                         (1,799)                 43
         Increase (decrease) in accounts payable, accrued
           interest expense and other accrued expenses....                                         (7,193)              7,488
         Decrease in net deferred tax liabilities.........                                         (8,622)             (2,038)
         Increase (decrease) in other long-term
           liabilities....................................                                            395              (1,869)
                                                                                               ----------          ----------
     Net cash provided by operating activities............                                         89,960              55,211
                                                                                               ----------          ----------
   Cash flows from investing activities:
     Proceeds from the disposal of assets.................                                             65                  26
     Additions to property, plant and equipment...........                                        (11,386)            (19,574)
                                                                                               ----------          ----------
     Net cash used by investing activities................                                        (11,321)            (19,548)
                                                                                               ----------          ----------
   Cash flows from financing activities:
     Payments for debt issuance costs.....................                                            -                (2,089)
     Additions to long-term debt..........................                                            -               486,500
     Payments of long-term debt...........................                                        (88,000)           (519,100)
     Proceeds from the issuance of treasury stock.........                                          3,492               2,856
                                                                                               -----------         ----------
     Net cash used by financing activities................                                        (84,508)            (31,833)
                                                                                               ----------          ----------
   Net increase (decrease) in cash and cash equivalents...                                         (5,869)              3,830
   Cash and cash equivalents at beginning of period.......                                         14,606               7,409
                                                                                               ----------          ----------
   Cash and cash equivalents at end of period.............                                     $    8,737          $   11,239
                                                                                               ==========          ==========
   Supplemental Disclosure:
     Cash payments for income taxes, net..................                                     $   12,067          $   36,631
                                                                                               ==========          ==========
     Cash payments for interest...........................                                     $   17,239          $   17,565
                                                                                               ==========          ==========

See accompanying notes to consolidated financial statements.
</TABLE>



<PAGE>


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in thousands except per share data)
(Unaudited)


(1)  Inventories are summarized as follows:

                                               June 30,            December 31,
                                                  2001                    2000
                                           -----------             -----------

              Finished products            $   130,713             $   125,491
              Work-in-process                   52,621                  61,932
              Raw materials                    105,353                 107,031
                                           -----------             -----------
                                           $   288,687             $   294,454
                                           ===========             ===========

(2)  Weighted  average  shares used in the  computation of basic and diluted net
     earnings per common share are as follows:

<TABLE>
<CAPTION>
                                                          Three Months Ended                    Six Months Ended
                                                     ----------------------------         ----------------------------
                                                     June 30, 2001  June 30, 2000         June 30, 2001  June 30, 2000
                                                     -------------  -------------         -------------  -------------
<S>                                                     <C>            <C>                   <C>            <C>
        Weighted average shares used
          for basic net earnings per
          common share                                  50,295,895     49,463,669            50,159,494     49,418,712
        Effect of dilutive securities:
          Stock options                                    918,289        997,243               989,417        987,098
                                                        ----------     ----------            ----------     ----------
        Weighted average shares used
          for diluted net earnings
          per common share                              51,214,184     50,460,912            51,148,911     50,405,810
                                                        ==========     ==========            ==========     ==========
</TABLE>

(3)  Comprehensive income, net of tax is as follows:

                                                          Six Months Ended
                                                   ----------------------------
                                                   June 30, 2001  June 30, 2000
                                                   -------------  -------------
       Net earnings                                   $21,328        $58,221

       Other comprehensive income
         Cumulative effect of adopting SFAS
           No. 133                                      2,960            -
         Effect of financial instruments
           accounted for as hedges                        143            -
                                                      -------        -------
                                                        3,103            -
                                                      -------        -------
       Comprehensive income                           $24,431        $58,221
                                                      =======        =======

(4)  In May 2001, in order to reduce the impact of changes in interest  rates on
     its floating rate long-term  debt, the Company  entered into three interest
     rate swap  agreements each having a notional amount of $100.0 million and a
     termination date in May 2004. The Company pays the counterparties a blended
     fixed rate of 4.93% per annum and receives  payment based upon the floating
     three-month LIBOR rate.

(5)  In the second  quarter  and six months  ended June 30,  2001,  the  Company
     recorded asset impairment and other restructuring  charges of $18.9 million
     and  $20.0  million,   respectively   ($12.3  million  and  $13.0  million,
     respectively,  net of taxes).  The charges  related to the  realignment  of
     selected domestic  manufacturing  operations and consisted of $18.0 million
     for the write down of property,  plant and equipment to  realizable  value,
     with the balance of the charges for severance and benefit related costs. It
     is anticipated that additional  charges of approximately  $2.0 million will
     be  incurred  during  the  remaining  six  months of 2001 to  complete  the
     restructuring.

(6)  On July 16,  2001,  a large  customer of the Company  filed for  protection
     under  Chapter  11 of the U.S.  Bankruptcy  Code.  This  customer  owed the
     Company  approximately  $7.3  million  as of the  filing  date.  While  the
     bankruptcy  filing was a third quarter event,  at June 30, 2001 the Company
     believes it was adequately reserved;  however, the reserve position will be
     reassessed at the end of the third quarter.


<PAGE>


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

RESULTS OF OPERATIONS
---------------------

Furniture Brands  International,  Inc.  (referred to herein as the "Company") is
one of the  largest  home  furniture  manufacturers  in the United  States.  The
Company has three primary operating subsidiaries: Broyhill Furniture Industries,
Inc.; Lane Furniture  Industries,  Inc.; and Thomasville  Furniture  Industries,
Inc.

Comparison of Three Months and Six Months Ended June 30, 2001 and 2000
----------------------------------------------------------------------

Selected  financial  information  for the three months and six months ended June
30, 2001 and June 30, 2000 is presented below:

(Dollars in millions except per share data)

<TABLE>
<CAPTION>
                                                                                         Three Months Ended
                                                                               -----------------------------------------
                                                                                   June 30, 2001        June 30, 2000
                                                                               --------------------  -------------------
                                                                                            %of                  % of
                                                                                Dollars   Net Sales   Dollars  Net Sales
                                                                                -------   ---------   -------  ---------
<S>                                                                              <C>        <C>        <C>       <C>
Net sales                                                                        $459.6     100.0%     $533.1    100.0%
Earnings from operations                                                            7.0       1.5%       55.5     10.4%
Interest expense                                                                    5.5       1.2%        9.3      1.7%
Income tax expense                                                                  0.5       0.1%       17.0      3.2%
Net earnings before extraordinary item                                              1.6       0.4%       30.1      5.7%
Net earnings per common share before
  extraordinary item - diluted                                                     0.03       -          0.60      -

Gross profit (1)                                                                 $114.8      25.0%     $141.6     26.6%


                                                                                          Six Months Ended
                                                                               -----------------------------------------
                                                                                   June 30, 2001        June 30, 2000
                                                                               --------------------  -------------------
                                                                                            %of                  % of
                                                                                Dollars   Net Sales   Dollars  Net Sales
                                                                                -------   ---------   -------  ---------
Net sales                                                                        $965.8     100.0%   $1,097.0    100.0%
Earnings from operations                                                           43.1       4.5%      112.2     10.2%
Interest expense                                                                   12.3       1.3%       18.9      1.7%
Income tax expense                                                                 10.9       1.1%       34.2      3.1%
Net earnings before extraordinary item                                             21.3       2.2%       60.7      5.5%
Net earnings per common share before
  extraordinary item - diluted                                                     0.42       -          1.21      -

Gross profit (1)                                                                 $240.1      24.9%     $290.0     26.4%


     (1)  The Company  believes that gross profit  provides  useful  information
          regarding a company's  financial  performance.  Gross  profit has been
          calculated  by  subtracting  cost of  operations  and the  portion  of
          depreciation associated with cost of goods sold from net sales.
</TABLE>
<TABLE>
<CAPTION>

                                                 Three Months Ended        Six Months Ended
                                                       June 30,                 June 30,
                                                 ------------------       --------------
                                                   2001      2000           2001      2000
                                                 --------  --------       --------  ------
<S>                                               <C>       <C>            <C>      <C>
      Net sales                                   $459.6    $533.1         $965.8   $1,097.0
      Cost of operations                           335.0     381.0          705.4      785.7
      Depreciation (associated with
        cost of goods sold)                          9.8      10.5           20.3       21.3
                                                  ------    ------         ------   --------
      Gross profit                                $114.8    $141.6         $240.1   $  290.0
                                                  ======    ======         ======   ========
</TABLE>

Net sales for the three months ended June 30, 2001 were $459.6 million, compared
to $533.1  million in the three  months ended June 30, 2000, a decrease of $73.5
million or 13.8%.  For the six months ended June 30, 2001,  net sales  decreased
$131.2  million or 12.0% to $965.8  million  from  $1,097.0  million for the six
months  ended June 30,  2000.  The  decrease  in sales arose  primarily  from an
overall  softness in order trends,  the impact of the  continuation  of retailer
bankruptcy  filings,  and the Company's  ongoing  program to focus sales efforts
away from doubtful and unprofitable  accounts.  Sales decreases were realized at
each operating company.


<PAGE>


Earnings from  operations  for the three months ended June 30, 2001 and June 30,
2000 were $7.0 million and $55.5 million,  respectively.  As a percentage of net
sales,  earnings  from  operations  for the three months ended June 30, 2001 and
June 30, 2000 were 1.5% and 10.4%,  respectively.  For the six months ended June
30, 2001 and June 30, 2000,  earnings  from  operations  were $43.1  million and
$112.2 million, respectively.  Earnings from operations for the six months ended
June 30, 2001 and June 30, 2000 were 4.5% and 10.2% of net sales,  respectively.
Earnings  from  operations  in the three and six months ended June 30, 2001 were
adversely impacted by asset impairment and other  restructuring  charges related
to the realignment of selected domestic manufacturing  operations totaling $18.9
million  and  $20.0  million,  respectively,  as  well  as  by  decreased  plant
utilization  resulting both from the sales volume  shortfall and increased focus
on imported products.

Interest expense totaled $5.5 million and $12.3 million for the three months and
six months ended June 30, 2001, respectively, compared to $9.3 million and $18.9
million for the prior year comparable periods.  The decrease in interest expense
during the  periods  resulted  both from lower  long-term  debt levels and lower
interest rates.

The  effective  income tax rates were 19.8% and 36.0% for the three months ended
June 30, 2001 and June 30, 2000,  respectively,  and 33.7% and 36.0% for the six
months ended June 30, 2001 and June 30, 2000,  respectively.  The  effective tax
rate for the three months ended June 30, 2001 was more  favorably  impacted than
the comparable prior year period due in part to nontaxable income and income tax
credits.  The effective tax rate for the six months ended June 30, 2001 was less
adversely  impacted than the comparable prior year period due in part to a lower
provision for state and local taxes.

Net earnings per common  share before  extraordinary  item for basic and diluted
were $0.03 and $0.03 for the three  months  ended June 30,  2001,  respectively,
compared with $0.61 and $0.60 for the same period last year,  respectively.  For
the six months  ended June 30, 2001 and June 30,  2000,  net earnings per common
share  before  extraordinary  item for basic and  diluted  were $0.43 and $0.42,
respectively,  and $1.23 and  $1.21,  respectively.  Average  common  and common
equivalent shares outstanding used in the calculation of net earnings per common
share on a basic and diluted basis were 50,296,000 and 51,214,000, respectively,
for the three  months  ended  June 30,  2001,  and  49,464,000  and  50,461,000,
respectively, for the three months ended June 30, 2000. For the six months ended
June 30, 2001 and June 30, 2000,  average  common and common  equivalent  shares
outstanding  used in the calculation of net earnings per common share on a basic
and diluted basis were 50,159,000 and 51,149,000,  respectively,  and 49,419,000
and 50,406,000, respectively.

FINANCIAL CONDITION

Working Capital
---------------

Cash and cash  equivalents  at June 30, 2001 amounted to $8.7 million,  compared
with $14.6  million at December 31,  2000.  During the six months ended June 30,
2001, net cash provided by operating  activities totaled $89.9 million, net cash
used  by  investing  activities  totaled  $11.3  million  and net  cash  used by
financing activities totaled $84.5 million.

Working  capital  was $517.5  million at June 30,  2001,  compared  with  $548.5
million at December 31, 2000.  The current  ratio was 4.9-to-1 at June 30, 2001,
compared to 4.8-to-1 at December 31, 2000.

Financing Arrangements
----------------------

As of June 30, 2001, long-term debt consisted of the following, in millions:

         Revolving credit facility                              $359.6
         Other                                                    14.4
                                                                ------
                                                                $374.0
                                                                ======
<PAGE>


To meet  short-term  capital  and  other  financial  requirements,  the  Company
maintains a $630.0 million  revolving  credit facility with a group of financial
institutions.  The revolving  credit facility allows for the issuance of letters
of credit and cash borrowings.  Letter of credit  outstandings are limited to no
more than $150.0 million,  with cash  borrowings  limited only by the facility's
maximum availability less letters of credit outstanding.  On June 30, 2001 there
were $359.6  million in cash  borrowings  and $30.1 million in letters of credit
outstanding, leaving an excess of $240.3 million available under the facility.

Cash borrowings under the revolving credit facility bear interest at a base rate
or at an  adjusted  Eurodollar  rate plus an  applicable  margin  which  varies,
depending upon the type of loan the Company executes. The applicable margin over
the base rate and Eurodollar rate is subject to adjustment  based upon achieving
certain credit ratings.  At June 30, 2001, loans outstanding under the revolving
credit  facility  consisted of $345.0  million based on the adjusted  Eurodollar
rate and $14.6 million based upon the base rate, for a weighted average interest
rate of 4.89%.

The Company  believes that its  revolving  credit  facility,  together with cash
generated from operations,  will be adequate to meet liquidity  requirements for
the foreseeable future.

Recently Issued Statements of Financial Accounting Standards
------------------------------------------------------------

In June 1998,  the  Financial  Accounting  Standards  Board issued  Statement of
Financial Accounting Standards No. 133 (SFAS No. 133) "Accounting for Derivative
Instruments and Hedging Activities." This statement  standardizes the accounting
for derivative  instruments  by requiring that an entity  recognize the items as
assets and  liabilities in the statement of financial  position and measure them
at fair value. SFAS No. 133, as amended, is effective for fiscal years beginning
after June 15, 2000. The Company adopted SFAS No. 133 effective January 1, 2001.
The adoption of this standard has not had a material impact on the  consolidated
financial position, results of operations or cash flows of the Company.

In July 2001,  the  Financial  Accounting  Standards  Board issued  Statement of
Financial Accounting  Standards No. 141 (SFAS No. 141), "Business  Combinations"
and No. 142 (SFAS No. 142), "Goodwill and Other Intangible Assets." SFAS No. 141
requires  that the  purchase  method  of  accounting  be used  for all  business
combinations  subsequent to June 30, 2001 and specifies criteria for recognizing
intangible assets acquired in a business combination. SFAS No. 142 requires that
goodwill  and  intangible  assets  with  indefinite  useful  lives no  longer be
amortized,  but instead be tested for impairment at least  annually.  Intangible
assets with  definite  useful  lives will  continue to be  amortized  over their
respective estimated useful lives. The Company will adopt SFAS No. 142 effective
January  1, 2002.  The  Company  believes  the effect of SFAS No. 142 will be to
increase annual earnings per common share by approximately $0.20.

OUTLOOK
-------

Incoming  order  activity  may have  bottomed,  but the Company has not seen any
evidence  of  sustained  improvement  in the  business  climate.  This  economic
environment,  coupled with recent  retailer  failures and the Company's  ongoing
strategy for  realigning  its customer  base to focus on  long-term,  profitable
sales  growth,  suggests that third quarter sales should be down in the 8% - 10%
range from those  reported for the same period last year with a recovery  toward
the end of the second half of the year;  however,  the recovery clearly will not
be soon enough,  or strong enough,  to offset the first half weakness.  Assuming
that level of sales  activity and excluding  all  restructuring  charges,  third
quarter earnings per common share are projected to be $0.25 to $0.27 compared to
$0.46 last year. For the full year ending December 31, 2001, earnings per common
share are projected to be $1.35 to $1.45 versus last year's $2.15  excluding all
impairment and restructuring charges and the extraordinary item.


<PAGE>


Capital  expenditures  are  forecasted  at $25.0 - $30.0  million  for the year.
Depreciation  and  amortization are anticipated to be $58.0 to $60.0 million for
the year. Selling, general and administrative expenses for the year are expected
to be in the range of 17.00% to 17.25% of net sales. Based upon current interest
rates,  interest  expense is expected to be  approximately  $23.0  million.  The
Company should generate upwards of $125 million in cash flow this year, which is
currently  expected  to be used  primarily  for  repayment  of  long-term  debt.
Earnings before interest expense,  income taxes,  depreciation and amortization,
and asset impairment and other  restructuring  charges as a percent of net sales
is expected to be in the 9.75% to 10.25% range for the full year.

The  percentage  of the  Company's  product  lines  represented  by imports will
continue to  increase.  Also,  the  Company  continues  to pursue its  dedicated
distribution  strategy.  The Thomasville  Home  Furnishings  Stores  development
program is on schedule to add  approximately  25 new stores per year with a goal
of 250  stores.  Finally,  The Home Depot  completed  the  rollout to all of its
stores of kitchen and bath cabinetry  marketed using the  "Thomasville"  name in
accordance with the previously reported licensing agreement.


FORWARD-LOOKING STATEMENTS
--------------------------

The Company herein has made forward-looking statements within the meaning of the
"safe harbor"  provisions  of the Private  Securities  Litigation  Reform Act of
1995. These  forward-looking  statements include statements containing the words
"expects," "anticipates,"  "estimates," "believes," and words of similar import.
The Company cautions investors that any such forward-looking  statements are not
guarantees  of future  performance  and that  certain  factors may cause  actual
results to differ materially from those in the forward-looking  statements. Such
factors may include:  overall business and economic conditions and growth in the
furniture  industry;  changes in customer  spending patterns and demand for home
furnishings;  competitive factors, such as design and marketing efforts by other
furniture manufacturers;  pricing pressures; success of the marketing efforts of
retailers and the prospects for further customer failures; the Company's success
in furniture design and manufacture;  the effects of manufacturing  realignments
and cost savings  programs;  and other risk factors  listed from time to time in
the Company's future public releases and SEC reports.


Item 3. Quantitative and Qualitative Disclosures about Market Risk

The  Company is exposed to market  risk from  changes  in  interest  rates.  The
Company's exposure to interest rate risk consists of its floating rate revolving
credit  facility.  In May 2001,  in order to reduce  the  impact of  changes  in
interest  rates on its floating rate long-term  debt,  the Company  entered into
three  interest  rate swap  agreements  each having a notional  amount of $100.0
million and a  termination  date in May 2004.  The swap  agreements  effectively
convert $300.0 million of the Company's  floating rate long-term debt to a fixed
rate.  The Company  pays the  counterparties  a blended  fixed rate of 4.93% per
annum and receives payment based upon the floating three-month LIBOR rate. As of
June 30, 2001, the unhedged  portion of the revolving  credit facility was $59.6
million and a hypothetical  one percent  increase in interest rates would result
in increased interest expense of $0.6 million on an annualized basis.



<PAGE>


                            PART II OTHER INFORMATION
                            -------------------------

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

          The Annual  Meeting of  Stockholders  was held on April 26, 2001.  The
          directors listed in the Notice of Annual Meeting of Stockholders dated
          March 16,  2001 were  elected  for terms of one year  ending 2002 with
          voting for each as follows:


          Director                   For                        Withheld
          --------                   ---                        --------

          K. B. Bell                 44,433,858                  409,306
          W. G. Holliman             37,825,120                7,018,044
          B. A. Karsh                44,439,782                  403,382
          D. E. Lasater              44,425,400                  417,764
          L. M. Liberman             44,428,000                  415,164
          R. B. Loynd                38,773,148                6,070,016
          M. Portera                 44,434,751                  408,413
          A. E. Suter                43,883,327                  959,837


          To vote to ratify the selection of KPMG LLP as independent auditors:

               Affirmative votes                            44,336,600
               Negative votes                                  493,072
               Abstentions                                      13,491
               Broker non-votes                                      0


Item 6.   Exhibits and Reports on Form 8 -K

          (b)  A Form 8-K was filed on April 27, 2001  announcing  first quarter
               operating results and projections of second quarter and full year
               sales  and  earnings.  A Form  8-K was  filed  on  June  5,  2001
               announcing the consolidation of Action  Industries,  Inc. and The
               Lane  Company,  Incorporated  into  their  parent  company,  Lane
               Furniture  Industries,  Inc. and  projections  of second  quarter
               sales  and  earnings.  A Form  8-K was  filed  on July  26,  2001
               announcing  second  quarter  and  first  half of  2001  operating
               results and projections for third quarter and full year sales and
               earnings.




<PAGE>


                                    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.


                                      Furniture Brands International, Inc.
                                                  (Registrant)


                                      By /s/ Steven W. Alstadt
                                         ---------------------------------
                                         Steven W. Alstadt
                                         Controller and
                                         Chief Accounting Officer




Date:  August 13, 2001