UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                               ------------------

                                    FORM 10-K
                                   (Mark One)

[X]              ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
                            SECURITIES EXCHANGE ACT OF 1934

                        For the fiscal year ended July 3, 1999

                                          OR

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

                             Commission file No. 00-19800

                         GIBRALTAR PACKAGING GROUP, INC.
             (Exact name of registrant as specified in its charter)

                    DELAWARE                           47-0496290
         (State of incorporation)           (IRS Employer Identification No.)
                               ------------------

                 2000 SUMMIT AVENUE
                 HASTINGS, NEBRASKA                          68901
      (Address of principal executive offices)            (Zip Code)

                                 (402) 463-1366
              (Registrant's telephone number, including area code)

        Securities registered pursuant to Section 12(b) of the Act: NONE

           Securities registered pursuant to Section 12(g) of the Act:
                     COMMON STOCK, PAR VALUE $0.01 PER SHARE
                                (Title of class)

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

         Indicate by check mark if disclosure of delinquent filers pursuant to
item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to the Form 10-K. |X|

         The aggregate market value of voting stock held by nonaffiliates of the
registrant on September 14, 1999 was $2,823,743 (based upon the September 14,
1999 closing sale price of the common stock as reported on the NASDAQ
Over-The-Counter Bulletin Board).

         The number of shares of common stock of the registrant outstanding as
of September 14, 1999 was 5,041,544 shares.

                       DOCUMENTS INCORPORATED BY REFERENCE
         Items 10, 11, 12 and 13 of Part III are incorporated by reference to
the definitive proxy statement relating to the registrant's Annual Meeting of
Stockholders for fiscal 1999, which definitive proxy statement will be filed
within 120 days of the end of the registrant's fiscal year.

<PAGE>

<TABLE>
<CAPTION>
                                               TABLE OF CONTENTS

                                                     PART I
                                                                                                              Page
                                                                                                              ----

<S>        <C>                                                                                               <C>
Item 1     Business.............................................................................................1

Item 2.    Properties...........................................................................................8

Item 3.    Legal Proceedings....................................................................................8

Item 4.    Submission of Matters to a Vote of Security Holders..................................................9



                                                      PART II

Item 5.    Market for the Registrant's Common Equity
           and Related Stockholder Matters.....................................................................10

Item 6.    Selected Financial Data.............................................................................11

Item 7.    Management's Discussion and Analysis of
           Financial Conditions and Results of Operations......................................................12

Item 8.    Financial Statements and Supplementary Data.........................................................18

Item 9.    Changes in and Disagreements with Accountants
           on Accounting and Financial Disclosure..............................................................18

                                                     PART III

Item 10.   Directors and Executive Officers of the Registrant..................................................19

Item 11.   Executive Compensation..............................................................................19

Item 12.   Security Ownership of Certain
           Beneficial Owners and Management....................................................................19

Item 13.   Certain Relationships and Related Transactions......................................................19

                                                      PART IV

Item 14.   Exhibits, Financial Statement
           Schedules, and Reports on Form 8-K..................................................................20
</TABLE>

<PAGE>

                                     PART I

ITEM 1.       BUSINESS

GENERAL

       Gibraltar Packaging Group, Inc. ("Gibraltar," or the "Company") designs,
manufactures and markets packaging products for a number of consumer and
industrial markets. The Company is the combination of several previously
independent packaging companies, each with its own distinctive products,
customer base and geographic focus. The acquisitions of Standard Packaging &
Printing Corp. ("Standard Packaging"), Niemand Industries, Inc. ("Niemand"), and
GB Labels, Inc. ("GB Labels") in 1993 expanded the Company's products from
folding cartons and specialty laminated containers to include tubular,
spiral-wound paper packaging, flexible poly-film packaging, contract packaging
and filling and pressure-sensitive labels. In August 1998 the Company announced
its strategy to refocus on its core capabilities in folding cartons. In April
1999 the Company sold the assets of the container portion of Niemand to Robinson
JDM Ltd. as a part of this strategy. In August 1999, the Company continued to
implement its revised strategy with the sale of the assets of GB Labels to
J.I.T. Manufacturing, Inc. The Company will complete its refocus when it sells
the remaining assets of the Niemand business, which is expected by the end of
the second quarter of fiscal 2000. Although most of the Company's sales are made
to customers located in the central and southern regions of the United States,
the Company sells its products to customers throughout the nation. The Company
derives its sales from a diverse market base, primarily comprised of the
following markets: textiles, food, pharmaceutical, auto aftermarket parts,
office supplies and paper products, household and industrial products, cosmetics
and personal care and toys.

       In fiscal 1999, the Company served approximately 900 customers from five
divisions: Gibraltar Packaging Group, Inc. (dba "Great Plains Packaging", or
"Great Plains") in Hastings, Nebraska; RidgePak Corporation (dba "Flashfold
Carton") in Fort Wayne, Indiana; Niemand in Marion, Alabama; Standard Packaging
in Mount Gilead, North Carolina and GB Labels in Burlington, North Carolina.
When Gibraltar has finalized implementation of its refocused strategy, the
Company estimates the resulting customer base to be approximately 650. The
Company believes the three folding carton divisions are situated to enhance its
competitive position by providing broader geographic coverage, enabling the
Company to serve customers that operate from several locations. The Company
intends to focus on the folding carton business and increase sales and
profitability of these packaging products.

       Gibraltar's predecessor was incorporated under the name GPC Co. in
Nebraska in 1967 and subsequently changed its name to Great Plains Packaging Co.
in 1986. In 1991, Great Plains Packaging Co. was reincorporated in Delaware, and
its name was changed to Gibraltar Packaging Group, Inc. As previously announced,
Gibraltar relocated its executive offices from Westport, Connecticut to
Hastings, Nebraska in November 1998, which are now located at 2000 Summit
Avenue, Hastings, Nebraska 68901. The Company's telephone number is (402)
463-1366.

MANUFACTURING PRODUCTS AND PROCESSES

       As a result of the sale of certain divisions as described above, the
Company now offers five types of packaging products. The Company had previously
offered its customers seven types of packaging products, all of which are
described below.

       FOLDING CARTONS

       The Company designs, manufactures and markets a variety of printed
folding cartons, which are purchased by customers in a variety of consumer and
industrial markets. The

                                      -1-
<PAGE>

Company's customers use folding cartons for both the shipment and retail display
of the customers' products. Sales of folding cartons represented approximately
63% of the Company's net sales for the year ended July 3, 1999, approximately
62% of the Company's net sales for the year ended June 27, 1998 and
approximately 59% of the Company's net sales for the year ended June 28, 1997.

       The Company believes that recent trends in the folding carton market
favor manufacturers that can produce creative graphics to enhance visual
presentation, point-of-sale appeal and product differentiation. Specialty
packaging designed to address these needs often includes graphics with
high-resolution print, more colors and innovative designs. The Company's
internal design teams have won numerous industry awards, due, in part, to the
Company's emphasis on product design. The Company believes that its design
resources enhance its competitiveness in the folding carton market, and results
in increased profitability.

       Folding cartons are produced at the Company's production facilities in
Hastings, Nebraska; Fort Wayne, Indiana; and Mount Gilead, North Carolina. After
a customer's order is received, paperboard purchased from outside suppliers in
rolled form is converted into sheets with sheeting equipment, in sizes specified
by the customer. The Company's customers supply graphic disks, artwork or film.
The Company then creates specialized printing plates which are used in the
printing of paperboard sheets on multicolor offset printing presses. The printed
board is then cut, creased, embossed, folded and glued into individual cartons
and packaged for shipment to customers.

       In June 1996, the Company's Hastings, Nebraska facility became the sixth
folding carton plant in the United States to achieve ISO 9001 certification, the
rigorous international quality standard. In January 1998 the Company's Fort
Wayne, Indiana facility also achieved ISO 9001 certification. The facility in
Mount Gilead, North Carolina is currently working toward certification, although
a completion date has yet to be determined. ISO (International Organization for
Standardization) is steadily becoming a worldwide standard for quality
management. It requires a company to codify its quality program by defining and
documenting its quality system.

       FLEXIBLE POLY-FILM PACKAGING

       Flexible packaging sales represented approximately 9% of the Company's
net sales for each of the years ended July 3, 1999 and June 27, 1998 and
approximately 8% of the Company's net sales for the year ended June 28, 1997.

       Flexible packaging offers light-weight, low-bulk, resource-conserving
packaging that also protects perishable products by creating a barrier against
air and moisture. For consumer marketing purposes, flexible packaging combines
high-quality, multicolor graphics, similar to folding carton graphics, with a
see-through feature that enables the consumer to see the product itself along
with the package graphics. Although the Company sells most of its flexible
packaging for use in the textile, food and household products markets, flexible
packaging is also used for many other products, including pharmaceuticals, other
medical products and toys.

                                      -2-
<PAGE>

       Flexible packaging is produced at the Standard Packaging plant in Mount
Gilead, North Carolina from polyethylene, polypropylene and similar plastic
materials. The Company purchases its plastic films from film manufacturers
rather than producing its own plastic films. The film is printed at the
Company's facilities using multicolor printing presses that are similar to those
used in folding carton manufacture. The printed rolls are then slit into smaller
rolls. Some printed film is shipped in roll form to customers who then convert
it into its final package form (for example, bags, pouches or overwrap). The
Company also converts the printed film into bags or pouches, and then ships the
final package forms to its customers. The Company has additional capabilities
which can be incorporated into poly-film packaging, which include affixing
pressure-sensitive labels, attaching hanging display hooks, grommets, zip-lock
closures and tape seals.

       SPECIALTY LAMINATED CARTONS

       At the Hastings, Nebraska facility, the Company manufactures specialty
laminated cartons, which it markets to customers throughout the United States,
primarily in the automotive aftermarket, frozen food and toy markets. Laminated
cartons are used for the retail sale of products and offer customers a number of
visual marketing benefits. Specialty laminated carton sales represented
approximately 6% of the Company's net sales for the year ended July 3, 1999 and
approximately 5% of the Company's net sales for each of the years ended June 27,
1998 and June 28, 1997. During the manufacturing process, laminated sheets,
which are composed of a printed paperboard folding carton sheet glued onto
single face corrugate, are die cut, glued and folded into cartons. Laminated
packaging offers a structurally stronger package suitable for packaging heavier
contents, protecting products during shipping or meeting other package
performance needs, while at the same time providing high-resolution graphics.
The Company believes that the resolution of the print and graphics enhances the
product's appeal, and that the lamination provides increased product visibility
with a large, exposed graphics area.

       CORRUGATED CONTAINERS

       The Company's Hastings, Nebraska facility also designs and manufactures
printed corrugated containers, which it markets to customers located in the
mid-western United States, primarily in the automotive aftermarket, marine and
agricultural markets. Corrugated container sales represented approximately 3% of
the Company's net sales for the year ended July 3, 1999, approximately 4% of the
Company's net sales for the year ended June 27, 1998 and approximately 3% of the
Company's net sales for the year ended June 28, 1997. Corrugated sheets are
purchased from outside suppliers, then printed, cut, creased folded and glued
into individual containers. The Company also manufactures corrugated inserts,
which require specialty die-cutting and gluing, and are used to provide
additional strength and protection of packaged products. Corrugated containers
offer a structurally strong package, suitable for protecting products during
shipping, or meeting other packaging performance needs.

       CONTRACT PACKAGING AND FILLING

       The Company's facility in Marion, Alabama currently provides contract
packaging and filling services, which represented approximately 6% of the
Company's net sales for the year ended July 3, 1999, approximately 3% of the
Company's net sales for the year ended June 27, 1998 and approximately 2% of the
Company's net sales for the year ended June 28, 1997. The Company intends to
discontinue contract packaging and filling as it focuses on the folding carton
industry.

       The Company fills, and in some cases, manufactures tubular spiral-wound
paper containers. Contract packaging and filling can provide a cost-effective
alternative for customers with small in-house purchasing departments, with the
Company taking responsibility for obtaining materials

                                      -3-
<PAGE>

as well as packaging the product. The Company fills spices as well as other food
products, including non-dairy creamer; household products such as carpet
freshener and wildflower seeds; and other types of dry granular products using a
similar process. The Company may formulate, procure, blend and fill the
container or it may package product supplied by a customer. Machines using
gravity or vacuum-based filling techniques are used to fill the containers. Once
the containers are filled, the Company packs them in shipping containers for
delivery to its customers.

       The Company also packages products for the candy industry. The process
requires feeding the product, which is supplied by the customer, into equipment
developed specifically for a co-packing process. The product is then sealed into
individually wrapped pieces, and shipped to the customer for retail sale.

       In connection with its filling operations, the Company maintains an
environmentally controlled work area for food packaging and other services that
must meet specific cleanliness and quality standards.

       DISCONTINUED MANUFACTURING PRODUCTS

       TUBULAR, SPIRAL-WOUND PAPER PACKAGING

       Tubular paper packaging products represented approximately 10% of the
Company's net sales for the year ended July 3, 1999, approximately 14% of the
Company's net sales for the year ended June 27, 1998 and approximately 17% of
the Company's net sales for the year ended June 28, 1997. In August 1998, the
Company announced its strategy to refocus on its core capabilities in folding
cartons. Although Niemand held a strong presence in tubular spiral-wound paper
packaging and contract packaging, the operations, as well as target markets,
were distinctly different from the folding carton business. In March 1999, the
Company announced the sale of the container portion of its Niemand division, and
as a result manufactures tubular paper packaging products only as requested by
some of its contract fill customers, with one exception. Niemand still
manufactures, and holds the patent for the spiral wound applicator used for
products that treat yeast infections. The percentage of net sales that tubular
paper packaging products comprised for the year ended July 3, 1999 was lower
than previous years due to decreased production resulting from the removal of
equipment starting in April 1999.

       Tubular packaging is structurally strong, high-quality, spiral-wound
paper packaging that is suitable for direct labeling with high-quality graphics.
Tubular paper packaging offers a biodegradable product that is, in smaller
quantities, generally cheaper than plastic alternatives. Tubular paper packaging
is used widely for personal care products (talcum powders, bath powders and
scented products), for food products (spices and non-dairy creamer) and for
household products (carpet freshener and wildflower seeds). Additionally, these
products are used as gift boxes, as well as having uses in the toy and game
industry.

       PRESSURE-SENSITIVE LABELS

       Pressure-sensitive labels accounted for approximately 3% of the Company's
net sales for each of the years ended July 3, 1999 and June 27, 1998 and
approximately 5% of the Company's net sales for the year ended June 28, 1997.
The labels are backed with adhesive, mounted on paper backing and typically
shipped in rolls to customers. Customers use these labels for a variety of
applications, including product promotions, packaging modifications, clothing
packaging and labeling and other applications.

                                      -4-
<PAGE>

         Labels provide a cost-effective means of altering other packaging (for
example, folding cartons or flexible packaging) in connection with product
promotions or tie-ins. Labels also may be used to highlight pricing or product
features or for other purposes. Labels themselves, typically in the form of
adhesive-backed bands, can be used as a form of packaging. Socks and hosiery
represent the most common application for label packaging.

         In August 1999, in connection with the Company's strategy to refocus on
its core business, the Company sold all of the assets of its GB Labels division,
and no longer manufactures pressure-sensitive labels.

COMPETITION

       The packaging markets in which the Company competes are highly fragmented
and increasingly competitive. The Company competes with numerous small,
non-integrated companies that produce one or more packaging products and, to a
lesser extent, with divisions or subsidiaries of large integrated packaging
producers as well as in-house packaging operations. The vertically integrated
paperboard, oil and chemical companies that the Company competes with may have
many lines of business and produce their own raw materials. In general, the
integrated companies focus primarily on producing large quantities of basic,
commodity packaging and often provide their products to large companies
nationwide. The non-integrated manufacturers generally operate only one or two
production facilities and emphasize higher-margin, value-added packaging, often
with specialized or customized graphics. Unlike the integrated manufacturers,
these manufacturers produce smaller orders of packaging with quick turnaround,
in many cases also working with the customer in designing the packaging.

       Competition among the non-integrated packaging manufacturers, against
which the Company primarily competes, is based on product quality, service,
timeliness of delivery, manufacturing capabilities and, to a lesser extent than
with commodity packaging, price. The Company believes that its expertise and
reputation within the packaging industry for providing timely service and
high-quality packaging enables it to compete effectively with other
non-integrated packaging companies.

       The Company's largest competitors in the flexible poly-film packaging
market operate as vertically integrated divisions or subsidiaries of large oil
and chemical companies. If the supply of oil-based resins or plastic films
should tighten in the future, large vertically integrated producers may have an
advantage over the Company, as such competitors could allocate scarce resin
resources to their own flexible packaging units or transfer them at advantageous
prices to their own flexible packaging units. Other competitors in the flexible
packaging market are part of diversified packaging companies like the Company,
and offer both paper-based and film-based packaging. Some of the Company's other
flexible packaging competitors are smaller packaging companies that offer only
flexible film packaging.

       Competition in the contract filling market is highly fragmented. Contract
filling is provided not only by a large number of relatively small competitors,
but also internally by goods and food producers themselves.

       The Company has also been impacted by the increasing trends of customers
to increase their buying power by consolidating the number of vendors they
maintain, as well as entering into alliances with their direct competitors to
use their competitors' excess packaging capacity.

       Many of the Company's competitors have greater resources, financial and
otherwise than the Company. In addition, to the extent that packaging methods
are developed and successfully marketed as alternatives to the Company's
products, the Company may compete with producers of such alternative packaging
methods.

                                      -5-
<PAGE>

RAW MATERIALS

       Raw materials used in the Company's production process include
paperboard, inks, flexible films, resin and adhesives, all of which the Company
purchases from more than one supplier. Pricing for raw materials throughout the
Company remained stable through the first and second quarters of fiscal 1999.
Raw material pricing has increased over the third and fourth quarters of fiscal
1999, and the Company anticipates these increases to continue through the first
and second quarters of fiscal 2000. Although the Company has been able to pass
these increases on to its customers, any future price increases would have an
adverse impact on the Company's results of operations if the Company is unable
to continue to pass these increases on to its customers.

        The supply of materials such as polyethylene, polypropylene, other
plastic films and plastic resins used in the Company's flexible packaging and
contract packaging products is subject to the disruptions generally associated
with the petroleum and petroleum product markets. The supply of plastic
materials depends upon factors beyond the control of the Company, including,
directly or indirectly, changes in the economy, price levels and seasons, the
level of domestic oil production, the availability of imports and the actions of
OPEC.

       Although the Company's supply of raw materials is presently sufficient,
its business could be adversely affected by a prolonged shortage of raw
materials, the resulting higher costs or diminished availability of such
materials.

CUSTOMERS

       The Company derives its sales from a diverse market base. In fiscal 1999,
the Company sold its products throughout the United States to over 900 different
customers for use in a variety of industries. The table below sets forth the
Company's percent of net sales by market for each of the years indicated:


<TABLE>
<CAPTION>

                                                      JULY 3          JUNE 27           JUNE 28
                                                        1999             1998              1997
                                                        ----             ----              ----

<S>                                                     <C>              <C>               <C>
         Textile                                        17%              17%               17%
         Food                                           16%              12%               12%
         Pharmaceutical                                 14%              15%               17%
         Auto aftermarket parts and hardware            13%              14%               14%
         Office supplies and paper products             13%              12%               16%
         Household and industrial                       11%              13%                7%
         Cosmetics and personal care                     6%               6%                7%
         Toy                                             1%               2%                4%
         Other                                           9%               9%                6%
                                                      -----             ----             -----
         Total net sales                               100%             100%              100%
                                                       ====             ====              ====
</TABLE>


       Sales to the Company's top three customers accounted for approximately
21% of the Company's net sales for the year ended July 3, 1999. This compares to
approximately 17% and 18% for the years ended June 27, 1998 and June 28, 1997
respectively. Sales to one customer, Smead

                                      -6-
<PAGE>

Manufacturing, represented approximately 12% of net sales in fiscal year 1999,
and approximately 11% in both the 1998 and 1997 fiscal years.

       The Company believes that developing long-term relationships with
customers is critical to its success in the packaging industry. Customers
generally purchase products and services under firm purchase orders rather than
long-term contracts, although the Company does have several customers with
contracts ranging from one to three years.

PATENTS

       Niemand holds several patents which cover proprietary technology and
packaging solutions, including a patent for the spiral-wound applicator used for
products that treat yeast infections. Although the Company believes these
patents to be economically valuable in the conduct of its business, the Company
does not believe that expiration or invalidation of any of these patents would
have a material adverse effect on the Company.

EMPLOYEES

         As of July 3, 1999, the Company employed approximately 671 full-time
employees, 127 salaried and 544 hourly. The Graphics Communication Union, No.
19-M, represents approximately 89 hourly employees at Fort Wayne, Indiana and
their union contract expires in November 1999. Management for the Company and
union representatives are currently in negotiations concerning the renewal of
the union contract. The Retail, Wholesale and Department Store Workers Union
represents approximately 124 hourly employees at Niemand's Marion, Alabama
plant, and their union contract expires in August 2000. None of the Hastings,
Nebraska; Mount Gilead, North Carolina or Burlington, North Carolina employees
are covered by union contracts or collective bargaining agreements.

       The Company markets its products and services primarily through
approximately 15 employee salesmen, as well as several commissioned brokers or
agents.

       The Company considers its relationship with its employees and unions to
be generally satisfactory. The Company is unable to forecast the future outcome
of negotiations between the Company and any union, or the potential impact any
dispute could have on the Company's financial position or results of operations.

REGULATION

       The Company's activities are subject to various environmental, health and
worker safety laws. The Company has expended resources, both financial and
managerial, to comply with applicable environmental, health and worker safety
laws in its operations and at its facilities, and anticipates that it will
continue to do so in the future. Compliance with environmental laws has not
generally had a material effect on the Company's capital expenditures, earnings
or competitive position. However, as part of the environmental due diligence
carried out in fiscal 1995 in connection with a proposed merger, the Company
became aware of groundwater contamination at its GB Labels facility in
Burlington, North Carolina.

       Groundwater testing performed in 1995 revealed the presence of
tetrachlorethelene ("PCE") and related compounds in the groundwater at the site,
and in three of the neighboring properties' wells. The Company notified the
North Carolina Division of Environmental Management and the County Health
Department, provided bottled water to affected residents, and offered to
connect, at its cost, any resident wishing to be connected to the municipal
water supply.

                                      -7-
<PAGE>

       In February 1997 the North Carolina Division of Water Quality ("DWQ")
asked Gibraltar to conduct a follow-up assessment of the GB Labels facility. The
Company arranged with its environmental consultants to install additional
groundwater monitoring wells, conduct additional investigative work at the GB
Labels site and prepare an updated report. The Comprehensive Assessment Report
was filed with the DWQ in June 1998. To date, the DWQ has requested no further
updates.

       In May 1998 two separate lawsuits were brought against GB Labels and the
Company, alleging property damage and personal injury arising from the
contamination. For further discussion, see "Item 3. Legal Proceedings."

       Following the August 1995 preliminary site assessment, the Company had
its environmental consultants prepare an estimate of likely remediation costs
based on all of the information known at that time. These estimated costs ranged
from $750,000 to $1.1 million over a period of seven to ten years. Accordingly,
the Company recorded a liability for such remediation costs of $750,000 in
fiscal year 1995. This estimate may be affected by new information learned, any
modifications to any remediation plan that may be proposed by the DWQ and the
actual costs incurred as part of evaluation and remediation. The reduction in
the accrual for such remediation costs to $475,000 from $578,000 at July 3, 1999
and June 27, 1998 respectively, reflects legal and environmental consulting
expenses incurred in fiscal 1999. Incurred expenses as of July 3, 1999 related
to remediation totaled $275,000. Management believes that the ultimate
resolution of this and other environmental matters will not materially affect
the financial position or results of future operations and cash flows of the
Company.


ITEM 2.  PROPERTIES

       The Company owns offices and manufacturing facilities in Hastings,
Nebraska; Fort Wayne, Indiana; Mount Gilead, North Carolina; Burlington, North
Carolina; and Marion, Alabama. It leases warehouse facilities in Hastings,
Nebraska; Fort Wayne, Indiana; Marion, Alabama and Mebane, North Carolina. The
Company's manufacturing facilities consist of a total of more than 600,000
square feet. The Company owns and leases vehicles for use by management, sales
and delivery personnel and also owns and leases various manufacturing, computer
and other equipment used for product development, customer technical support
services and administrative purposes. The Company's products are distributed to
customers primarily utilizing commercial transportation and, to a limited
extent, Company-owned trucks.

       The Company's facilities have been expanded in prior years through its
capital expenditure program. No facilities expansions occurred in fiscal 1999 or
in fiscal 1998. The total expenditures for fiscal 1997 approximated $0.2
million.

       The Company's facilities and equipment are generally in good operating
condition, are suitable for their respective uses and are adequate for current
needs.

       The Company maintains business property and other insurance, covering its
facilities and its operations, in amounts and covering such risks as are
generally consistent with industry practice for companies of similar size.


ITEM 3.  LEGAL PROCEEDINGS

       From time to time, the Company is a party to certain lawsuits and
administrative proceedings that arise in the conduct of its business. While the
outcome of these lawsuits and proceedings cannot be predicted with certainty,
management believes that, if adversely

                                      -8-
<PAGE>

determined, the lawsuits and proceedings, either singularly or in the aggregate,
would not have a material adverse effect on the financial condition, results of
operations or net cash flows of the Company.

       In May 1998, two lawsuits, captioned Monroe B. Moorefield et al v.
Bernard H. Oakley, Sr., et al, File Number 98CVS 990-; and Harold L. Fogleman et
al v. Bernard H. Oakley, Sr., et al, File Number 98 CVS 989, were filed in
Alamance County, State of North Carolina, alleging property damage and personal
injury arising from the groundwater contamination at GB Labels. The Company and
GB Labels, among others, were also named as defendants in the lawsuits. The
plaintiffs are all property owners, or their family members, residing near the
GB Labels facility.

       In November 1998, the Moorefield plaintiffs dismissed their entire
complaint against the Company without prejudice. Although no Moorefield claims
are pending against the company, there can be no assurance that they will not
re-file their claims at a later date.

       In September 1999, the Fogleman plaintiffs entered into a settlement
agreement with the Company and dismissed their entire complaint with prejudice.

       On April 28, 1999, the Company filed a lawsuit captioned Gibraltar
Packaging Group, Inc. v. Anthem Health Plans, d.b.a. Anthem Blue Cross and Blue
Shield of Connecticut ("Anthem"), Case No. 3:99DV00785, in the United States
District Court for the District of Connecticut. The Company is seeking damages
for Anthem's alleged breach of a contract for health insurance for employees of
the Company. While the Company initiated this action, it anticipates that Anthem
will file a counterclaim for unpaid premiums. The amount of the anticipated
counterclaim is presently unknown, and there can be no assurances that the
outcome of a potential counterclaim would not have an adverse impact on the
Company. The case is scheduled for a settlement mediation in October 1999.


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

         No matters were submitted to a vote of stockholders of Gibraltar during
the fourth quarter of Gibraltar's fiscal year ended July 3, 1999.

                                      -9-
<PAGE>

                                     PART II

ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS

PRICE RANGE OF COMMON STOCK

       The Company's common stock was quoted on the NASDAQ National Market
System after the Company's initial public offering on March 5, 1992. In February
1999, the Company announced that it had been de-listed from the NASDAQ National
Market, and the Company's stock is currently traded on the NASDAQ
Over-The-Counter Bulletin Board. The trading symbol for the Company's common
stock is "PACK." The following table sets forth, for the periods indicated, the
high and low sale prices for the Company's common stock as reported by NASDAQ:

                                                    HIGH                 LOW

     FISCAL 1999
       First Quarter                          $     2 7/8         $     1 1/8
       Second Quarter                               1 1/2                 3/4
       Third Quarter                                1 3/8                 3/4
       Fourth Quarter                               1 3/16                9/16

     FISCAL 1998
       First Quarter                          $     3 1/2         $     2 5/8
       Second Quarter                               3 1/4               2 1/8
       Third Quarter                                3 9/16              2 13/32
       Fourth Quarter                               4 5/8               1 3/4

       There were approximately 140 shareholders of record of the Company's
common stock as of September 14, 1999. The Company believes that the number of
beneficial owners of its common stock is greater than 1,500.

DIVIDEND POLICY

       The Company has never paid cash dividends on its common stock. Any
payment of cash dividends in the future will depend upon the terms of the
Company's debt instruments, the financial condition, capital requirements and
earnings of the Company, as well as other factors the Board of Directors may
deem relevant. In addition, the Company's credit facility with First Source
Financial LLP restricts the ability of the Company to pay dividends.

RECENT SALES OF UNREGISTERED SECURITIES

None.

                                      -10-
<PAGE>

ITEM 6.             SELECTED FINANCIAL DATA

       The following selected historical financial information has been derived
from the Company's audited consolidated financial statements. This information
should be read in connection with the Company's Consolidated Financial
Statements and the Notes thereto, as well as "Management's Discussion and
Analysis of Financial Condition and Results of Operations," included elsewhere
in this Annual Report.

<TABLE>
<CAPTION>
                                 GIBRALTAR PACKAGING GROUP, INC. AND SUBSIDIARIES
                                       SELECTED CONSOLIDATED FINANCIAL DATA
                                       (IN THOUSANDS, EXCEPT PER SHARE DATA)

                                                                           YEARS ENDED
                                               JULY 3         JUNE 27        JUNE 28        JUNE 29          JULY 1
                                               1999(1)        1998(2)        1997(3)          1996            1995
                                               -------        -------        -------          ----            ----
<S>                                           <C>             <C>            <C>            <C>             <C>
STATEMENT OF OPERATIONS DATA:

Net Sales                                     $76,514         $75,890        $74,710        $74,384         $76,456
Cost of Goods Sold                             65,711          64,138         59,396         58,328          64,045
Gross Profit                                   10,803          11,752         15,314         16,056          12,411
Operating Expenses                             21,802          26,411         11,362         11,481          14,061
Income (Loss) From Operations                 (10,999)        (14,659)         3,952          4,575          (1,650)
Other Expense - Net                             3,324           3,989          3,061          3,208           3,652
Provision (Benefit) for Income Taxes             (751)         (1,435)           559            666          (1,617)
Income (Loss) before Extraordinary Item       (13,572)        (17,213)           332            701          (3,685)
Net Income (Loss)                             (13,572)        (17,213)           225            701          (3,685)

Basic and Diluted Per Common Share Amounts:
Income (Loss) before Extraordinary Item         (2.69)          (3.41)          0.07           0.14           (0.73)
Net Income (Loss)                               (2.69)          (3.41)          0.05           0.14           (0.73)
Weighted Average Shares Outstanding             5,042           5,042          5,042          5,042           5,040

BALANCE SHEET DATA:

Working Capital                                 3,357           4,969          6,078          6,455           5,940
Total Assets                                   43,338          59,371         75,058         74,045          79,036
Long-Term Debt (net of current portion)        27,943          27,872         27,382         27,834          31,527
Stockholders' Equity                              446          14,018         31,100         31,006          30,305
</TABLE>


     (1) Includes impairment write-downs of long-lived assets related to
         Flashfold Carton and GB Labels of $11,861 and $352, respectively, and
         restructuring charges of $235 related to the relocation of the
         Company's corporate offices.

     (2) Includes a charge for severance and relocation costs of approximately
         $500 and a restructuring charge of $170 consisting of severance costs
         for divisional personnel. Results also include an impairment write-down
         of long-lived assets related to Niemand of approximately $14,083 and a
         write-off of unamortized finance costs related to the Harris Bank
         refinancing of approximately $854.

     (3) Includes an extraordinary after-tax loss of $107 reflecting the
         write-off of unamortized finance costs of a previous refinancing.

                                      -11-
<PAGE>


ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

         Unless otherwise stated in this Annual Report, references to the fiscal
years 1999, 1998 and 1997 relate to the fiscal years ended July 3, 1999, June
27, 1998 and June 28, 1997, respectively.

RESULTS OF OPERATIONS

         The following table presents, for the periods indicated, the percentage
relationship that certain items in the Company's Consolidated Statement of
Operations bear to net sales. This information should be read in conjunction
with the Company's Consolidated Financial Statements and the Notes thereto
included elsewhere in this Annual Report.

<TABLE>
<CAPTION>
                                                                                        YEARS ENDED
                                                                         ------------------------------------------
                                                                          JULY 3          JUNE 27          JUNE 28
                                                                           1999             1998            1997
                                                                           ----             ----            ----
<S>                                                                       <C>               <C>             <C>
Net Sales                                                                 100.0%            100.0%          100.0%
Cost of Goods Sold                                                         85.9              84.5            79.5
Gross Profit                                                               14.1              15.5            20.5
Operating Expenses                                                         28.5              34.8            15.2
Income (Loss) from Operations                                             (14.4)            (19.3)            5.3
Other Expense - Net                                                         4.3               5.3             4.1
Provision (Benefit) for Income Taxes                                       (1.0)             (1.9)            1.0
Income (Loss) before Extraordinary Item                                   (17.7)            (22.7)            0.4
Net Income (Loss)                                                         (17.7)%           (22.7)%           0.3%
</TABLE>

FISCAL YEAR 1999 VS. 1998

       In fiscal 1999, the Company's net sales were $76.5 million compared with
$75.9 million in fiscal 1998. Net sales increased $0.6 million or 0.8% in fiscal
1999 compared with fiscal 1998. Sales of folding cartons and flexible packaging
increased $1.7 million in fiscal 1999 over fiscal 1998, primarily at Great
Plains. Sales of spiral wound paper packaging decreased compared with prior year
levels, primarily as a result of the removal of equipment related to the sale of
the container business of Niemand, which started in April 1999. Sales of
pressure sensitive labels decreased compared with prior year levels.

       Cost of goods sold increased $1.6 million or 2.5% to $65.7 million in
fiscal 1999 compared with $64.1 million in fiscal 1998. Expressed as a
percentage of net sales, cost of goods sold increased to 85.9% for fiscal 1999
compared to 84.5% in fiscal 1998. Margins at Flashfold Carton were below plan
and compared to the prior year. Niemand suffered adverse product mix changes as
sales of their higher margin products declined. Standard Packaging experienced
increased manufacturing costs primarily attributable to higher labor costs
associated with servicing customer demands, and higher repair and maintenance
costs. These increased costs were partially offset by certain cost improvements.
Raw material costs continued to decline at Standard Packaging as a result of
renegotiated prices with suppliers and the internalization of the die making and
ink mixing processes. Labor costs at Great Plains and Flashfold Carton also
decreased due to less overtime and more emphasis placed on reducing labor costs.
In addition, depreciation expense has been reduced in fiscal 1999 at Niemand and
Flashfold Carton, as a result of long-lived asset impairment write-downs.

       Selling expenses decreased $0.7 million or 15.2% to $3.4 million in
fiscal 1999 from $4.1 million in fiscal 1998. Expressed as a percentage of net
sales, selling expenses decreased to 4.5% in fiscal 1999 compared with 5.4% in
fiscal 1998, primarily as a result of reorganizing the

                                      -12-
<PAGE>

Company's sales force and internalizing previously out-sourced functions within
its marketing programs. These reductions are a direct result of cost savings
following the Company's organizational and facility consolidations implemented
in the second quarter of fiscal 1998.

       General and administrative expenses decreased $1.9 million or 25.9% to
$5.6 million in fiscal 1999 from $7.5 million in fiscal 1998. Expressed as a
percentage of net sales, general and administrative expenses decreased to 7.3%
in fiscal 1999 compared with 9.9% in fiscal 1998. The Company continues to
realize the cost savings benefits of the second quarter fiscal 1998
restructuring program. In addition, general and administrative expenses were
lower as a result of the relocation of the Company's corporate functions from
Westport, Connecticut to its Hastings, Nebraska facility in the second quarter
of fiscal 1999. Included in general and administrative expenses in the second
quarter of fiscal 1998 is a charge for severance and relocation costs of
approximately $0.5 million.

       In the second quarter of fiscal 1999, the Company recorded a
restructuring charge of $0.2 million consisting of severance costs for corporate
personnel, the write-off of leasehold improvements and moving costs associated
with relocating the corporate functions to its Hastings, Nebraska facility.

       At the end of the third quarter of fiscal 1999, as a result of the
Company's evaluation of the recoverability of long-lived assets not held for
sale, the Company recorded a pre-tax non-cash charge of $11.8 million to
write-down the carrying amount of goodwill and fixed assets of Flashfold Carton
to estimated fair value. Estimated fair value was determined based on
discounting estimated future cash flows associated with Flashfold Carton. The
impairment loss resulted in completely writing-off the Flashfold Carton goodwill
and reducing the carrying value of fixed assets.

       In connection with the Company's strategic plan, the Company decided to
sell the machinery, equipment, accounts receivable, inventory and accounts
payable of GB Labels. As a result, the Company recorded a pre-tax non-cash
charge of $82,000 in the fourth quarter of fiscal 1999 to write down the
carrying amount of goodwill and the fixed assets sold of GB Labels to estimated
fair value less cost to sell. Additionally, the Company recorded a pre-tax
non-cash charge of $0.3 million to write-down the carrying amount of the
retained real property of GB Labels to estimated fair value.

       Interest expense for fiscal 1999 decreased $0.7 million or 16.9% to $3.3
million from $4.0 million in fiscal 1998. In the fourth quarter of fiscal 1998,
the Company wrote-off $0.9 million in unamortized refinancing costs related to
the previous credit agreement with Harris Trust and Savings Bank. This reduction
in cost was partially offset by increased interest expense in fiscal 1999 as a
result of higher average borrowings of approximately $2.4 million, coupled with
higher interest rates.

       The income tax benefit as a percentage of pre-tax loss for fiscal 1999
was 5.2%, which differs from the statutory rate primarily as a result of
non-deductible amortization of excess of purchase price over net assets
acquired, and because a significant portion of the impairment charge is a
write-off of goodwill, which will provide no current or future tax benefit. The
equivalent tax rate was 7.7% for the corresponding period in the prior year.

FISCAL YEAR 1998 VS. 1997

       In fiscal 1998 the Company's net sales were $75.9 million compared with
$74.7 million in fiscal 1997. Net sales increased $1.2 million or 1.6% in fiscal
1998 compared with fiscal 1997. Sales of spiral wound paper packaging and
pressure sensitive labels decreased compared with prior year levels while sales
of folding cartons and flexible packaging increased $3.9 million in fiscal 1998
over fiscal 1997.

                                      -13-
<PAGE>

       Cost of goods sold increased $4.7 million, or 8.0% to $64.1 million in
fiscal 1998 compared with $59.4 million in fiscal 1997. Cost of goods sold
expressed as a percentage of net sales increased to 84.5% for fiscal 1998
compared to 79.5% for fiscal 1997. The increase in the costs of products sold
over the comparable period in fiscal 1998 is primarily attributable to the
following events. Standard Packaging incurred higher manufacturing costs
associated with both gearing up and servicing new customers in the second half
of 1998. Additionally, Standard Packaging and Niemand suffered some adverse mix
changes as sales of its higher margin products declined. Flashfold Carton
incurred unusually high costs related to preventative maintenance and
modifications made to its presses in order to add capacity in the third quarter
of fiscal 1998. Flashfold Carton also experienced higher manufacturing costs
related to increased production in anticipation of new business in the first
quarter of fiscal 1999. In addition, during the second quarter of fiscal 1998,
the Company changed from a self-insured medical plan to a new fully insured
plan, and experienced a number of large claims under the old plan, which
significantly increased medical costs for the period.

       Selling expenses decreased $0.2 million or 5.5% in fiscal 1998 from $4.3
million in fiscal 1997. Selling expenses for the second half of fiscal 1998
decreased $0.5 million compared to the corresponding period in fiscal 1997 as a
direct result of realized cost savings associated with the Company's
organizational and facility consolidations implemented in the second quarter of
fiscal 1998.

       General and administrative expenses expressed as a percentage of net
sales increased to 9.9% for fiscal 1998 compared with 8.7% for fiscal 1997, an
increase of $1.0 million or 16.0%. Included in the second quarter of fiscal 1998
is an increase in receivable, inventory and other reserves of $0.6 million and a
charge for severance and relocation costs of approximately $0.5 million. The
Company began to realize the cost saving benefits of the second quarter
restructuring program as general and administrative expenses for the second half
of fiscal 1998 decreased $0.3 million compared to the corresponding period in
fiscal 1997.

       Included in the second quarter of fiscal 1998 is a restructuring charge
of $0.2 million consisting of severance costs for divisional personnel. Other
costs relating to the reorganization are included in general and administrative
expenses and consist of severance and relocation costs.

       In connection with a modification of the Company's strategic plan, the
Company decided to divest one of its subsidiaries, Niemand Industries. As a
result, the Company recorded a charge of $14,083,000 in the fourth quarter of
fiscal 1998 to write down the carrying amount of goodwill and fixed assets of
Niemand to estimated fair value less cost to sell. In prior years, the Company
evaluated the recoverability of long-lived assets at Niemand using estimated,
undiscounted cash flows. By deciding to sell that business, recoverability now
must be based on estimated fair value less cost to sell. The impairment loss
resulted in completely writing-off the Niemand goodwill and reducing the
carrying value of fixed assets.

       Interest expense for fiscal 1998 increased $1.0 million or 32.4% to $4.0
million from $3.0 million for fiscal 1997. The increase is primarily
attributable to the Company writing-off the unamortized financing costs of $0.9
million related to the credit agreement with Harris Bank as a result of the
acceleration of the maturity date of such credit agreement to July 1998.

       The benefit for income taxes as a percentage of pre-tax loss for fiscal
1998 was 7.7%, which differed from the statutory rate primarily as a result of
non-deductible amortization in excess of purchase price over net assets acquired
and the effect of disallowed losses with respect to the impaired asset
write-down as discussed in Note 1 to the Company's Consolidated Financial
Statements included elsewhere in this Annual Report. This compared with an
effective tax rate of 62.7% in the prior year.

                                      -14-
<PAGE>

FINANCIAL CONDITION

       At the end of fiscal 1998, the Company and Harris Trust and Savings Bank
agreed to accelerate the maturity of the Company's bank credit agreement to
August 10, 1998. The Company's bank credit agreement with Harris Bank consisted
of a $25 million term loan and a $10 million revolving credit facility.

       On July 31, 1998, the Company refinanced its debt. The Company's new
credit facility with First Source Financial LLP ("First Source") provides for a
five year $25 million term loan and a five year $15 million working capital
revolving line of credit ("Revolver"). The term loan requires quarterly
principal payments of $562,500 in the first year of the loan, beginning October
15, 1998. As amended, the balance of the term loan is due in quarterly
installments of $625,000 through October 1999, in monthly installments of
$208,333 through July 2000 and $229,167 through April 2003, with the balance of
$12,687,500 due on July 31, 2003.

       The proceeds from the credit facility were used to refinance the Harris
Bank credit facility, to repay a note payable related to the Alabama facility,
to pay the related transactions costs, and to fund the working capital and
capital expenditure needs of the Company. The credit facility is secured by a
first priority perfected security interest in and lien on all assets (real and
personal, tangible and intangible) of the Company excluding the Burlington,
North Carolina property.

       The Revolver provides for a revolving line of credit under a borrowing
base commitment subject to certain loan availability requirements. Loan
availability under the Revolver may not exceed the lesser of (1) $15 million or
(2) the sum of (a) up to 85% of the Company's eligible accounts receivable plus
(b) up to 60% of the Company's eligible inventory. At no time may the sum of
aggregated loan advances outstanding under the Revolver plus the aggregate
amount of extended Letter of Credit guarantees exceed loan availability.

       As of July 3, 1999, all outstanding letters of credit are guaranteed by
First Source. The Company pays a letter of credit fee of 2.75% to guarantee
availability under the Revolver. Outstanding letters of credit at July 3, 1999
amounted to $222,000 and relate to workman's compensation insurance policies.

       The First Source credit facility contains certain restrictive covenants
including financial covenants related to Net Worth, Minimum Interest Coverage
Ratio, Capital Expenditures, Debt Ratio and Fixed Charge Coverage. As of July 3,
1999, the Company was not in compliance with its financial covenants. First
Source has waived the covenant violations relating to Net Worth, Minimum
Interest Coverage Ratio, Capital Expenditures, Debt Ratio and Fixed Charge
Coverage as of July 3, 1999.

       The Revolver currently bears interest at First Source's prime rate plus
1.25%, while the term loan currently bears interest at First Source's prime rate
plus 1.75%. The Company also pays a commitment fee of 0.5% on the difference
between the average daily loan balance and the amount of the Revolver. First
Source's prime rate was 8% at July 3, 1999. Effective January 25, 1999, the
LIBOR option was suspended.

       At July 3, 1999, the Company had working capital of $3.4 million, as
compared to $5.0 million at June 27, 1998. Historically, the Company's liquidity
requirements have been met by a combination of funds provided by operations and
its revolving credit agreements. Funds provided by operations totaled $0.5
million in fiscal 1999 and $2.8 million in fiscal 1998. The Company had
available to it unused borrowing capacity of $1.8 million and $0.7 million at
July 3, 1999 and June 27, 1998, respectively. The decrease in operating cash
flow for fiscal 1999 was primarily attributable to the paydown of accounts
payable to better coincide with vendors' terms, partially offset by better
inventory management.

                                      -15-
<PAGE>

       During fiscal 1999, capital expenditures totaled $1.3 million compared
with $2.1 million in fiscal 1998, and consisted primarily of additions to
machinery and equipment as well as improvements to existing facilities. The
Company makes capital improvements to increase efficiency and product quality,
and periodically upgrades its equipment by purchasing or leasing new or
previously used equipment.

       The Company's current strategy is to leverage the success of the
Company's Great Plains division to improve the performance of the Company's
other folding carton divisions. The Company has identified opportunities for
profit enhancement at Standard Packaging. After the write-down at Flashfold
Carton, the Company will continue to strive to identify opportunities for profit
enhancement at that facility. Additionally, in the second quarter of fiscal
1999, the Company relocated its corporate office, and consolidated the Company's
administrative functions with the Great Plains' operation in Hastings, Nebraska.
As part of the strategy of focusing on folding cartons, the Company sold the
container portion of Niemand and is in negotiations for the sale of the
remaining assets of Niemand. The Company anticipates completing this divestiture
in the second quarter of fiscal 2000. Additionally, the Company sold the assets
of its GB Labels division effective August 30, 1999.

       Under the current strategy, management believes that future funds
generated by operations and borrowings available under its credit facility with
First Source will be sufficient to meet working capital and capital expenditure
requirements in the near term.


IMPACT OF NEW ACCOUNTING PRONOUNCEMENTS

       In June 1998, SFAS No. 133, ACCOUNTING FOR DERIVATIVE INSTRUMENTS AND
HEDGING ACTIVITIES, was issued. This statement will become effective in fiscal
2001. The Company has not quantified the impact, if any, resulting from the
adoption of this standard.


QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

       The Company's primary market risk is fluctuation in interest rates. All
of the Company's debt at July 3, 1999 is at variable interest rates, and the
Company has in the past utilized interest rate caps to reduce the impact of
changes in interest rates. A hypothetical 10% change in interest rates would
have had a $0.3 million impact on interest expense for the fiscal year ended
July 3, 1999.


YEAR 2000 COMPLIANCE

       The Year 2000 issue is the result of computer systems that use two digits
rather than four to define the applicable year, which may prevent such systems
from accurately processing dates ending in the Year 2000 and after. This could
result in system failures or in miscalculations causing disruption of
operations, including, but not limited to, an inability to process transactions,
to send and receive electronic data, or to engage in routine business activities
and operations.

       The Company's goal is to be Year 2000 compliant, meaning critical
systems, devices, applications or business relationships have been evaluated and
are expected to be suitable for continued use into and beyond the Year 2000. The
folding carton divisions of the Company (Great Plains, Flashfold Carton and
Standard Packaging) have installed AmTech's Imaginera software for their
manufacturing and accounting IS systems. These information systems are certified
by the vendor to be Year 2000 Compliant.

                                      -16-
<PAGE>

       The Company began in fiscal 1998 evaluating personal computer hardware
and software outside of the Company's IS systems. The Company's expectations are
to complete any upgrade requirements or modifications by the end of calendar
1999.

       Year 2000 Costs: Niemand Industries is currently upgrading all of its
manufacturing and financial software and hardware systems to be Year 2000
Compliant. The upgrades will be completed by the end of October 1999. Budgeted
costs for these upgrades were set at $90,000, and currently Niemand anticipates
they will stay within budget. All other costs incurred as a result of ensuring
Year 2000 compliance, to date, have been expensed or capitalized as software
purchases in the normal course of operations of the Company. Any remaining costs
for the Year 2000 project will be reflected as general and administrative costs
incurred in the normal course of operations, due to the Company's internal IS
department managing the project.

       Risk Assessment: At this time, the Company believes its most reasonably
likely worst case scenarios are: (1) that principal suppliers are not Year 2000
ready and cannot timely deliver their products; (2) that the Company could
experience an extended interruption in any one of its utility, communication or
transportation systems. Although the Company does not believe that any of these
scenarios will occur, it has assessed the effects of such events and does not
expect that they would have a material adverse effect on the Company's financial
condition and results of operations.

       In addition to reviewing its internal systems, the Company has contacted
all of its significant vendors and customers to ensure their Year 2000
compliance. The Company currently has many suppliers, and believes this will
help mitigate any adverse impact. Although all outside company responses have
indicated Year 2000 compliance, there can be no assurance that the systems of
other companies that interact with the Company will be sufficiently Year 2000
compliant so as to avoid an adverse impact on the Company's operations,
financial condition and results of operations. In the event that a temporary
disruption does occur, the Company does not expect that it would have a material
adverse effect on its financial condition and results of operations.

       Contingency Plans: Although the Company expects its internal systems to
be Year 2000 compliant as described above, contingency plans are being prepared
so that the Company's critical business processes can be expected to continue to
function on January 1, 2000 and beyond. The Company's contingency plans will be
structured to address both remediation of systems and their components and
overall business operating risk. These plans are intended to mitigate both
internal risks and potential risks in the supply chain of the Company's
suppliers. These plans will also address the potential risks of power outages,
communication interruptions and transportation delays. The Company expects to
complete its contingency plan during calendar year 1999.

FORWARD-LOOKING STATEMENTS

       Statements that are not historical facts, including statements about our
confidence in the Company's prospects and strategies and our expectations about
the Company's sales expansion, are forward-looking statements that involve risks
and uncertainties. These risks and uncertainties include, but are not limited
to, (1) market acceptance risks, including whether or not the Company will be
able to successfully gain market share against competitors many of which have
greater financial and other resources than the Company and the increasing trends
of customers to enhance their buying power by consolidating the number of
vendors they maintain; (2) manufacturing capacity constraints, including whether
or not as the Company increases its sales it will be able to successfully
integrate its new customers into its existing manufacturing and distribution
system; (3) whether the Company will be able to pass on to its customers price
increases for paper and paperboard products in fiscal 2000; (4) continued
stability in other raw material prices, including oil-based resin and plastic
film; (5) the impact of government regulation on the Company's manufacturing,
including whether or not additional capital expenditures will be needed to
comply

                                      -17-
<PAGE>

with applicable environmental laws and regulations as the Company's production
increases; (6) pressure on prices from competition or purchasers of the
Company's products; (7) the introduction of competing products by other firms;
(8) whether the proposed sale of the product fill portion of Niemand Industries
will be successful; (9) whether the Company will be able to comply with the
Credit Agreement covenants or obtain waivers if it is unable to do so; (10)
whether the Company will be adversely affected by its inability or the inability
of other companies whose systems interact with the Company to be fully Year 2000
compliant in a timely manner; and (11) whether Anthem will file a counterclaim
against the Company. Investors and potential investors are cautioned not to
place undue reliance on these forward-looking statements, which reflect the
Company's analysis only as of the date hereof. Gibraltar undertakes no
obligation to publicly revise these forward-looking statements to reflect events
or circumstances that arise after the date hereof. These risks and others that
are detailed in this Form 10-K and other documents that the Company files from
time to time with the Securities and Exchange Commission, including quarterly
reports on Form 10-Q and any current reports on Form 8-K must be considered by
any investor or potential investor in the Company.


ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

       Reference is made to the financial statements, the report thereon, the
notes thereto, and supplementary data commencing at page F-1 of this Annual
Report on Form 10-K which financial statements, report, notes, and data are
incorporated herein by reference.


ITEM 9. CHANGE IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE

         None.



                                      -18-
<PAGE>

                                    PART III


ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

       The information relating to the identification, business experience and
directorships of each director and nominee for director of Gibraltar and the
information relating to the identification and business experience of
Gibraltar's executive officers, required by Item 401 of Regulation S-K, will be
presented in the sections entitled "Election of Directors - Nominees for
Director" and "Executive Compensation and Other Information Executive Officers"
of Gibraltar's definitive proxy statement for the Annual Meeting of Stockholders
for fiscal 1999, and is hereby incorporated by reference. If the definitive
proxy statement for the 1999 annual meeting is not filed with the Securities and
Exchange Commission within 120 days of the end of Gibraltar's 1999 fiscal year,
Gibraltar will amend this Annual Report and include such information in the
amendment.


ITEM 11. EXECUTIVE COMPENSATION

       The information relating to the cash compensation of directors and
officers required by Item 402 of Regulation S-K will be presented in the
sections entitled "Election of Directors - Director Compensation" and "Executive
Compensation and Other Information" of Gibraltar's definitive proxy statement
for the Annual Meeting of Stockholders for fiscal 1999 and is hereby
incorporated by reference. If the definitive proxy statement for the 1999 annual
meeting is not filed with the Securities and Exchange Commission within 120 days
of the end of Gibraltar's 1999 fiscal year, Gibraltar will amend this Annual
Report and include such information in the amendment.


ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

       The information relating to security ownership required by Item 403 of
Regulation S-K will be presented in the section entitled "Voting Securities and
Principal Stockholders" of Gibraltar's definitive proxy statement for the Annual
Meeting of Stockholders for fiscal 1999 and is hereby incorporated by reference.
If the definitive proxy statement for the 1999 annual meeting is not filed with
the Securities and Exchange Commission within 120 days of the end of Gibraltar's
1999 fiscal year, Gibraltar will amend this Annual Report and include such
information in the amendment.


ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

       The information relating to certain relationships and transactions
required by Item 404 of Regulation S-K will be presented in the section
"Executive Compensation and Other Information - Certain Transactions" of
Gibraltar's definitive proxy statement for the Annual Meeting of Stockholders
for fiscal 1999 and is hereby incorporated by reference. If the definitive proxy
statement for the 1999 annual meeting is not filed with the Securities and
Exchange Commission within 120 days of the end of Gibraltar's 1999 fiscal year,
Gibraltar will amend this Annual Report and include such information in the
amendment.



                                      -19-
<PAGE>

                                     PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

       (a)(1)   Financial Statements

<TABLE>
<CAPTION>
                                                                                                   Page
                                                                                                   ----

<S>                                                                                                   <C>
       Independent Auditors' Report                                                                 F-1

       Consolidated Balance Sheets,
         July 3, 1999 and June 27, 1998                                                             F-2

       Consolidated Statements of Operations,
         Years Ended July 3, 1999, June 27, 1998 and June 28, 1997                                  F-3

       Consolidated Statements of Stockholders' Equity,
         Years Ended July 3, 1999, June 27, 1998 and June 28, 1997                                  F-4

       Consolidated Statements of Cash Flows,
         Years Ended July 3, 1999, June 27, 1998 and June 28, 1997                                  F-5

       Notes to Consolidated Financial Statements                                                   F-6
</TABLE>

       All schedules of the Registrant for which provision is made in the
applicable accounting regulations of the Securities and Exchange Commission are
not required under the related instructions, are inapplicable, or have been
disclosed in the Notes to Consolidated Financial Statements and, therefore, have
been omitted.

         (2) Exhibits

         EXHIBITS

     3.1     Certificate of Incorporation, as amended, of Gibraltar Packaging
             Group, Inc. (incorporated by reference to Exhibit 3.1 to
             Gibraltar's Registration Statement on Form S-1 (File No. 33-44965),
             as amended, filed January 9, 1992).

     3.2     By-Laws of Gibraltar Packaging Group, Inc. (incorporated by
             reference to Exhibit 3.2 to Gibraltar's Registration Statement on
             Form S-1 (File No. 33-44965), as amended, filed January 9, 1992).

     4.1     Specimen Common Stock Certificate (incorporated by reference to
             Exhibit 4.1 to Gibraltar's Registration Statement on Form S-1 (File
             No. 33-44965), as amended, filed January 9, 1992).

    10.1     Agreement and Plan of Reorganization, dated as of January 7, 1992,
             among Gibraltar Packaging Group, Inc., RidgePak Acquisition
             Corporation, RidgePak Corporation, and the Shareholders of RidgePak
             Corporation (incorporated by reference to Exhibit 10.1 to
             Gibraltar's Registration Statement on Form S-1 (File No. 33-44965),
             as amended, filed January 9, 1992).

    10.2     Registration Rights Agreement, dated March 4, 1992, by and among
             Gibraltar Packaging Group, Inc. and certain stockholders of
             Gibraltar Packaging Group, Inc. (incorporated by reference to
             Exhibit 4.2 to Gibraltar's Annual Report on Form 10-K for the year
             ended June 30, 1992 (File No. 00-19800)).

                                      -20-
<PAGE>

**  10.3     Employment Agreement, dated February 10, 1992, between Gibraltar
             Packaging Group, Inc. and Deke C. Abbott, Jr. (incorporated by
             reference to Exhibit 10.6 to Gibraltar's Registration Statement on
             Form S-1 (File No. 33-44965), as amended, filed January 9, 1992).

**  10.4     Gibraltar Packaging Group, Inc. 1992 Incentive Stock Option Plan,
             dated March 5, 1992 and amended as of April 28, 1994 (incorporated
             by reference to Exhibit 10.5 to Gibraltar's Annual Report on Form
             10-K for the year ended July 2, 1994 (File No. 00-19800)).

**  10.5     Gibraltar Packaging Group, Inc. Director Stock Option Plan dated
             July 13, 1992 and amended as of April 28, 1994 (incorporated by
             reference to Exhibit 10.6 to Gibraltar's Annual Report on Form 10-K
             for the year ended July 2, 1994 (File No. 00-19800)).

**  10.6     Employment Agreement, dated December 1, 1992, between Gibraltar
             Packaging Group, Inc. and Richard Hinrichs (incorporated by
             reference to Exhibit 28.1 to Gibraltar's Quarterly Report on Form
             10-Q for the period ended December 31, 1992 (File No. 00-19800)).

    10.7     Stock Purchase Agreement, dated January 28, 1993, by and among
             Gibraltar Packaging Group, Inc., Standard Packaging and Printing
             Corp. and each of the shareholders of Standard Packaging and
             Printing Corp. (incorporated by reference to Exhibit 2.1 to
             Gibraltar's Current Report on Form 8-K dated January 28, 1993 (File
             No. 00-19800)).

    10.8     Registration Rights Agreement, dated as of January 28, 1993,
             between Gibraltar Packaging Group, Inc. and Brady W. Dickson and
             Joan H. Dickson (incorporated by reference to Exhibit 28.1 to
             Gibraltar's Quarterly Report on Form 10-Q for the quarterly period
             ended March 31, 1993 (File No. 00-19800)).

    10.9     Agreement and Plan of Reorganization, dated April 28, 1993, by and
             among Gibraltar Packaging Group, Inc., Niemand Acquisition
             Corporation, Niemand Holdings, Inc., Niemand Industries, Inc., and
             each of the stockholders of Niemand Holdings, Inc. (incorporated by
             reference to Exhibit 2.1 to Gibraltar's Current Report on Form 8-K
             dated April 28, 1993 (File No. 00-19800)).

    10.10    Registration Rights Agreement, dated April 28, 1993, by and among
             Gibraltar Packaging Group, Inc. and the former stockholders of
             Niemand Holdings, Inc. listed on Schedule I thereto (incorporated
             by reference to Exhibit 28.1 to Gibraltar's Current Report on Form
             8-K dated April 28, 1993 (File No. 00-19800)).

    10.11    Stock Sale Agreement, dated November 8, 1993, between Gibraltar
             Packaging Group, Inc. and Golden Belt Manufacturing Company
             (incorporated by reference to Exhibit 10.35 to Gibraltar's Annual
             Report on Form 10-K for the year ended July 2, 1994 (File No.
             00-19800)).

     10.12  Agreement and Plan of Merger, dated as of March 17, 1995, as
             extended by letter agreement dated June 15, 1995 and as terminated
             by letter agreement dated August 3, 1995, among Caraustar
             Industries, Inc., GibPac Acquisition Company and Gibraltar
             Packaging Group, Inc. (incorporated by reference to Exhibit 10.37
             to Gibraltar's Annual Report on Form 10-K for the year ended July
             1, 1995 (File No. 00-19800)).

                                      -21-
<PAGE>

**  10.13    Gibraltar Packaging Group, Inc. 1996 Non-Qualified Stock Option
             Plan (incorporated by reference to Exhibit 10.39 to Gibraltar's
             Annual Report 10-K for the year ended June 29, 1996 (File No.
             00-19800)).

**  10.16    Letter Agreement, dated December 18, 1997 between Gibraltar
             Packaging Group, Inc. and Richard D. Hinrichs regarding employment
             (incorporated by reference to Exhibit 10.16 to Gibraltar's Annual
             Report on Form 10-K for the year ended June 27, 1998 (File No.
             00-19800)).

    10.17    Secured Credit Agreement, dated July 31, 1998, among Gibraltar
             Packaging Group, Inc., various financial institutions and First
             Source Financial LLP, Individually and as Agent ("The Credit
             Agreement") (incorporated by reference to Exhibit 10.17 to
             Gibraltar's Annual Report on Form 10-K for the year ended June 27,
             1998 (File No. 00-19800)).

    10.18    Term Note, dated July 31, 1998, in favor of First Source Financial
             LLP, executed by Gibraltar Packaging Group, Inc. In the principal
             amount of $25,000,000 (incorporated by reference to Exhibit 10.18
             to Gibraltar's Annual Report on Form 10-K for the year ended June
             27, 1998 (File No. 00-19800)).

    10.19    Revolving Note, dated July 31, 1998, in favor of First Source
             Financial LLP, executed by Gibraltar Packaging Group, Inc. In the
             principal amount of $15,000,000 (incorporated by reference to
             Exhibit 10.19 to Gibraltar's Annual Report on Form 10-K for the
             year ended June 27, 1998 (File No. 00-19800)).

    10.20    Security Agreement executed by GB Labels, Inc., dated July 31,
             1998, in favor of First Source Financial LLP (incorporated by
             reference to Exhibit 10.20 to Gibraltar's Annual Report on Form
             10-K for the year ended June 27, 1998 (File No. 00-19800)).

    10.21    Security Agreement executed by RidgePak Corporation, dated July 31,
             1998, in favor of First Source Financial LLP (incorporated by
             reference to Exhibit 10.21 to Gibraltar's Annual Report on Form
             10-K for the year ended June 27, 1998 (File No. 00-19800)).

    10.22    Security Agreement executed by Standard Packaging and Printing
             Corp., dated July 31, 1998, in favor of First Source Financial LLP
             (incorporated by reference to Exhibit 10.22 to Gibraltar's Annual
             Report on Form 10-K for the year ended June 27, 1998 (File No.
             00-19800)).

    10.23    Security Agreement executed by Niemand Holdings, Inc., dated July
             31, 1998, in favor of First Source Financial LLP (incorporated by
             reference to Exhibit 10.23 to Gibraltar's Annual Report on Form
             10-K for the year ended June 27, 1998 (File No. 00-19800)).

    10.24    Security Agreement executed by Niemand Industries, Inc., dated July
             31, 1998, in favor of First Source Financial LLP (incorporated by
             reference to Exhibit 10.24 to Gibraltar's Annual Report on Form
             10-K for the year ended June 27, 1998 (File No. 00-19800)).

    10.25    Pledge Agreement executed by Niemand Holdings, Inc., dated July 31,
             1998, in favor of First Source Financial LLP (incorporated by
             reference to Exhibit 10.25 to Gibraltar's Annual Report on Form
             10-K for the year ended June 27, 1998 (File No. 00-19800)).

                                      -22-
<PAGE>

    10.26    Deed of Trust Security Agreement, executed by Gibraltar Packaging
             Group, Inc., dated July 31, 1998, in favor of First Source
             Financial LLP (incorporated by reference to Exhibit 10.26 to
             Gibraltar's Annual Report on Form 10-K for the year ended June 27,
             1998 (File No. 00-19800)).

    10.27    Deed of Trust Security Agreement, executed by Standard Packaging
             and Printing Corp., dated July 31, 1998, in favor of First Source
             Financial LLP (incorporated by reference to Exhibit 10.27 to
             Gibraltar's Annual Report on Form 10-K for the year ended June 27,
             1998 (File No. 00-19800)).

    10.28    Security Agreement executed by Gibraltar Packaging Group, Inc.,
             dated July 31, 1998, in favor of First Source Financial LLP
             (incorporated by reference to Exhibit 10.28 to Gibraltar's Annual
             Report on Form 10-K for the year ended June 27, 1998 (File No.
             00-19800)).

    10.29    Pledge Agreement executed by Gibraltar Packaging Group, Inc., dated
             July 31, 1998, in favor of First Source Financial LLP (incorporated
             by reference to Exhibit 10.29 to Gibraltar's Annual Report on Form
             10-K for the year ended June 27, 1998 (File No. 00-19800)).

    10.30    Guaranty, dated July 31, 1998 among Gibraltar Packaging Group,
             Inc., RidgePak Corporation, Standard Packaging and Printing Corp.,
             Niemand Holdings, Inc., Niemand Industries Inc., GB Labels, Inc.
             And First Source Financial LLP (incorporated by reference to
             Exhibit 10.30 to Gibraltar's Annual Report on Form 10-K for the
             year ended June 27, 1998 (File No. 00-19800)).

    10.31    Mortgage Security Agreement executed by RidgePak Corporation, dated
             July 31, 1998 in favor of First Source Financial LLP (incorporated
             by reference to Exhibit 10.31 to Gibraltar's Annual Report on Form
             10-K for the year ended June 27, 1998 (File No. 00-19800)).

   10.32     Mortgage Security Agreement executed by Niemand Industries, Inc.,
             dated July 31, 1998 in favor of First Source Financial LLP
             (incorporated by reference to Exhibit 10.32 to Gibraltar's Annual
             Report on Form 10-K for the year ended June 27, 1998 (File No.
             00-19800)).

**10.33      Gibraltar Packaging Group, Inc.1998 Stock Appreciation Rights Plan,
             dated November 30, 1998 (incorporated by reference to Exhibit 10.33
             to Gibraltar's Quarterly Report on Form 10-Q for the period ended
             December 31, 1998 (File No. 00-19800)).

**10.34      Employment Agreement, dated January 15, 1999, between Gibraltar
             Packaging Group, Inc. and John W. Lloyd (incorporated by reference
             to Exhibit 10.34 to Gibraltar's Quarterly Report on Form 10-Q for
             the period ended December 31, 1998 (File No. 00-19800)).

**10.35      Employment Agreement, dated January 15, 1999, between Gibraltar
             Packaging Group, Inc. and Richard D. Hinrichs (incorporated by
             reference to Exhibit 10.35 to Gibraltar's Quarterly Report on Form
             10-Q for the period ended December 31, 1998 (File No. 00-19800)).

                                      -23-
<PAGE>

**10.36      Stock Appreciation Rights Agreement, dated January 15, 1999,
             between Gibraltar Packaging Group, Inc. and John W. Lloyd
             (incorporated by reference to Exhibit 10.36 to Gibraltar's
             Quarterly Report on Form 10-Q for the period ended December 31,
             1998 (File No. 00-19800)).

**10.37      Stock Appreciation Rights Agreement, dated January 15, 1999,
             between Gibraltar Packaging Group, Inc. and Richard D. Hinrichs
             (incorporated by reference to Exhibit 10.37 to Gibraltar's
             Quarterly Report on Form 10-Q for the period ended December 31,
             1998 (File No. 00-19800)).

   10.38     First Amendment to Secured Credit Agreement, dated September 1,
             1998, among Gibraltar Packaging Group, Inc., various financial
             institutions and First Source Financial LLP, Individually and as
             agent (incorporated by reference to Exhibit 10.38 to Gibraltar's
             Quarterly Report on Form 10-Q for the period ended December 31,
             1998 (File No. 00-19800)).

   10.39     Second Amendment to Secured Credit Agreement, dated November 15,
             1998, among Gibraltar Packaging Group, Inc., various financial
             institutions and First Source Financial LLP, Individually and as
             agent (incorporated by reference to Exhibit 10.39 to Gibraltar's
             Quarterly Report on Form 10-Q for the period ended December 31,
             1998 (File No. 00-19800)).

   10.40     Third Amendment to Secured Credit Agreement, dated February 11,
             1999, among Gibraltar Packaging Group, Inc., various financial
             institutions and First Source Financial LLP, Individually and as
             agent (incorporated by reference to Exhibit 10.40 to Gibraltar's
             Quarterly Report on Form 10-Q for the period ended December 31,
             1998 (File No. 00-19800)).

   10.41     Fourth Amendment to Secured Credit Agreement, dated May 15, 1999,
             among Gibraltar Packaging Group, Inc., various financial
             institutions and First Source Financial LLP, Individually and as
             agent (incorporated by reference to Exhibit 10.41 to Gibraltar's
             Quarterly Report on Form 10-Q for the period ended March 31, 1999
             (File No. 00-19800)).

* 10.42      Asset Purchase Agreement, dated February 25, 1999, between Robinson
             JDM Ltd. (Buyer) and Niemand Industries, Inc. (Seller).

* 10.43      Escrow Agreement, dated March 29, 1999, among Robinson JDM Ltd.
             (Buyer), Niemand Industries, Inc. (Seller) and Chicago Title
             Insurance Company.

* 10.44      First Amendment to Asset Purchase Agreement, dated April 20, 1999,
             between Robinson JDM Ltd. (Buyer) and Niemand Industries, Inc.
             (Seller).

* 10.45      Non-Competition and Non-Solicitation Agreement, dated May 28, 1999,
             among Robinson JDM Ltd., Gibraltar Packaging Group, Inc. and
             Niemand Industries, Inc.

* 10.46      Asset Purchase Agreement, dated September 1, 1999, between JIT
             Manufacturing, Inc. (Buyer) and GB Labels, Inc. (Seller).

* 10.47      Non-Competition Agreement, dated September 1, 1999, between JIT
             Manufacturing, Inc. and Gibraltar Packaging Group, Inc.

* 10.48      Guaranty Agreement, dated September 1, 1999, between JIT
             Manufacturing, Inc. and Gibraltar Packaging Group, Inc.

                                      -24-
<PAGE>

* 10.49      Fifth Amendment to Secured Credit Agreement, dated September 29,
             1999, among Gibraltar Packaging Group, Inc., various financial
             institutions and First Source Financial LLP, Individually and as
             agent.

*  21.1      Subsidiaries of Gibraltar Packaging Group, Inc.

*  23.1      Consent of Deloitte & Touche LLP.

*  27.1      Financial Data Schedule.

-----------------
*Filed herewith.

**Indicates management contract or compensatory plan.

         (b)    Reports on Form 8-K.

                The Company filed a Form 8-K on March 5, 1999, referencing its
                de-listing from the Nasdaq National Market. The de-listing took
                effect at close of business on February 23, 1999.

                                      -25-
<PAGE>

SIGNATURES

         Pursuant to the requirements of Section 13 or 15(d) 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.


                           GIBRALTAR PACKAGING GROUP, INC.

         By:               /s/ John W. Lloyd
                           ------------------------
                           John W. Lloyd
                           Chief Financial Officer

         Date:      September 30, 1999


         Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.


     /s/ Walter E. Rose                              /s/ John W. Lloyd
     ------------------------------                  --------------------------
     Walter E. Rose                                  John W. Lloyd
     Chief Executive Officer and                     Chief Financial Officer
     Chairman of the Board                           (Principal Financial and
     (Principal Executive Officer)                   Accounting Officer)
     September 30, 1999                              September 30, 1999



     /s/ David G. Chandler                           /s/ Robert G. Shaw
     ------------------------------                  --------------------------
     David G. Chandler                               Robert G. Shaw
     Director                                        Director
     September 30, 1999                              September 30, 1999



     /s/ John D. Strautnieks
     ------------------------------
     John D. Strautnieks
     Director
     September 30, 1999


                                      -26-
<PAGE>

INDEPENDENT AUDITORS' REPORT

BOARD OF DIRECTORS
GIBRALTAR PACKAGING GROUP, INC.
HASTINGS, NEBRASKA

WE HAVE AUDITED THE ACCOMPANYING CONSOLIDATED BALANCE SHEETS OF GIBRALTAR
PACKAGING GROUP, INC. AND ITS SUBSIDIARIES AS OF JULY 3, 1999 AND JUNE 27, 1998,
AND THE RELATED CONSOLIDATED STATEMENTS OF OPERATIONS, STOCKHOLDERS' EQUITY, AND
CASH FLOWS FOR EACH OF THE THREE YEARS IN THE PERIOD ENDED JULY 3, 1999. THESE
FINANCIAL STATEMENTS ARE THE RESPONSIBILITY OF THE COMPANY'S MANAGEMENT. OUR
RESPONSIBILITY IS TO EXPRESS AN OPINION ON THESE FINANCIAL STATEMENTS BASED ON
OUR AUDITS.

WE CONDUCTED OUR AUDITS IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING
STANDARDS. THOSE STANDARDS REQUIRE THAT WE PLAN AND PERFORM THE AUDIT TO OBTAIN
REASONABLE ASSURANCE ABOUT WHETHER THE FINANCIAL STATEMENTS ARE FREE OF MATERIAL
MISSTATEMENT. AN AUDIT INCLUDES EXAMINING, ON A TEST BASIS, EVIDENCE SUPPORTING
THE AMOUNTS AND DISCLOSURES IN THE FINANCIAL STATEMENTS. AN AUDIT ALSO INCLUDES
ASSESSING THE ACCOUNTING PRINCIPLES USED AND SIGNIFICANT ESTIMATES MADE BY
MANAGEMENT, AS WELL AS EVALUATING THE OVERALL FINANCIAL STATEMENT PRESENTATION.
WE BELIEVE THAT OUR AUDITS PROVIDE A REASONABLE BASIS FOR OUR OPINION.

IN OUR OPINION, SUCH CONSOLIDATED FINANCIAL STATEMENTS PRESENT FAIRLY, IN ALL
MATERIAL RESPECTS, THE FINANCIAL POSITION OF GIBRALTAR PACKAGING GROUP, INC. AND
SUBSIDIARIES AT JULY 3, 1999 AND JUNE 27, 1998, AND THE RESULTS OF THEIR
OPERATIONS AND THEIR CASH FLOWS FOR EACH OF THE THREE YEARS IN THE PERIOD ENDED
JULY 3, 1999 IN CONFORMITY WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES.


/S/ DELOITTE & TOUCHE LLP

DELOITTE & TOUCHE LLP

OMAHA, NEBRASKA
SEPTEMBER 24, 1999
(SEPTEMBER 29, 1999 AS TO NOTE 4)


                                      F-1
<PAGE>

                GIBRALTAR PACKAGING GROUP, INC. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS
                        (IN THOUSANDS EXCEPT SHARE DATA)

<TABLE>
<CAPTION>


                                                                                           JULY 3           JUNE 27
                                                                                             1999              1998
<S>                                                                                     <C>               <C>
ASSETS

CURRENT ASSETS:
     Cash                                                                               $     198         $     114
     Accounts receivable  (NET OF ALLOWANCE FOR DOUBTFUL ACCOUNTS OF $194
         AND $162, RESPECTIVELY)                                                            7,287             7,820
     Inventories                                                                            8,027            10,667
     Deferred income taxes                                                                    972               892
     Prepaid and other current assets                                                         350               483
                                                                                        ---------         ---------

         Total current assets                                                              16,834            19,976
PROPERTY, PLANT AND EQUIPMENT - Net                                                        21,182            25,362
EXCESS OF PURCHASE PRICE OVER NET ASSETS ACQUIRED
     (NET OF ACCUMULATED AMORTIZATION OF $1,794 AND
     $3,368, RESPECTIVELY)                                                                  4,543            13,775

OTHER ASSETS  (NET OF ACCUMULATED AMORTIZATION OF $191  AND
     $1,199, RESPECTIVELY)                                                                    779               258
                                                                                        ---------         ---------
TOTAL                                                                                   $  43,338         $  59,371
                                                                                        =========         =========

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
     Checks not yet presented                                                           $     976         $   1,119
     Current portion of long-term debt                                                      2,891             2,034
     Accounts payable                                                                       6,502             9,310
     Accrued expenses                                                                       3,001             2,344
     Income taxes payable                                                                     107              200
                                                                                        ---------         ---------
         Total current liabilities                                                         13,477            15,007
LONG-TERM DEBT - Net of current portion                                                    27,943            27,872
DEFERRED INCOME TAXES                                                                         834             1,659
OTHER LONG-TERM LIABILITIES                                                                   638               815
                                                                                        ---------         ---------
         Total liabilities                                                                 42,892            45,353
                                                                                        ---------         ---------

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY:
     Preferred stock, $.01 par value; 1,000,000 shares authorized; none issued
     Common stock, $.01 par value; 10,000,000 shares
     authorized; 5,041,544 issued and outstanding                                              50                50
     Additional paid-in capital                                                            28,162            28,162
    Accumulated deficit                                                                  (27,766)           (14,194)
                                                                                        --------          ---------
         Total stockholders' equity                                                           446            14,018
                                                                                        ---------         ---------

TOTAL                                                                                   $  43,338           $59,371
                                                                                        =========         =========
</TABLE>


SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.


                                      F-2
<PAGE>

                GIBRALTAR PACKAGING GROUP, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF OPERATIONS
            YEARS ENDED JULY 3, 1999, JUNE 27, 1998 AND JUNE 28, 1997
                        (IN THOUSANDS EXCEPT SHARE DATA)

<TABLE>
<CAPTION>


                                                                            1999             1998              1997

<S>                                                                   <C>              <C>               <C>
NET SALES                                                             $   76,514       $   75,890        $   74,710

COST OF GOODS SOLD                                                        65,711           64,138            59,396
                                                                      ----------       ----------        ----------

GROSS PROFIT                                                              10,803           11,752            15,314
                                                                      ----------       ----------        ----------

OPERATING EXPENSES:

   Selling                                                                 3,448            4,065             4,301

   General and administrative                                              5,561            7,508             6,475

   Amortization of excess of purchase price
     over net assets acquired                                                345              585               586

   Restructuring charges                                                     235              170                 -


   Impairment of long-lived assets                                        12,213           14,083                 -
                                                                      ----------       ----------        ----------

     Total operating expenses                                             21,802           26,411            11,362
                                                                      ----------       ----------        ----------

INCOME (LOSS) FROM OPERATIONS                                            (10,999)         (14,659)            3,952
                                                                      ----------       -----------       ----------

OTHER (INCOME) EXPENSE:

   Interest expense                                                        3,336            4,016             3,033

   Other (income) expense - net                                              (12)             (27)               28
                                                                      ----------       -----------       ----------

     Other expense - net                                                   3,324            3,989             3,061
                                                                      ----------       ----------        ----------

INCOME (LOSS) BEFORE INCOME TAXES AND
EXTRAORDINARY ITEM                                                       (14,323)        (18,648)               891
PROVISION (BENEFIT) FOR INCOME TAXES                                        (751)         (1,435)               559
                                                                      -----------      ----------        ----------

INCOME (LOSS) BEFORE EXTRAORDINARY ITEM                                  (13,572)         (17,213)              332

EXTRAORDINARY ITEM (net of tax effect of $66)
(Write-off of finance charges as a result of debt repayment)                  -                 -              (107)
                                                                      ----------       ----------        ----------

NET INCOME (LOSS)                                                       ($13,572)        ($17,213)       $      225
                                                                      ===========      ===========       ==========

BASIC AND DILUTED PER COMMON SHARE AMOUNTS:

   Income (Loss) Before Extraordinary Item                               ($2.69)          ($3.41)        $     0.07
                                                                      ==========       ==========        ==========

   Net Income (Loss)                                                     ($2.69)          ($3.41)        $     0.07
                                                                      ==========       ==========        ==========

WEIGHTED AVERAGE SHARES OUTSTANDING                                    5,041,544        5,041,544         5,041,544
                                                                      ==========       ==========        ===========
   (basic and diluted)
</TABLE>

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.


                                      F-3
<PAGE>

                GIBRALTAR PACKAGING GROUP, INC. AND SUBSIDIARIES

                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
            YEARS ENDED JULY 3, 1999, JUNE 27, 1998 AND JUNE 28, 1997
                        (IN THOUSANDS EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
                                            COMMON STOCK          ADDITIONAL     RETAINED
                                       NUMBER OF                    PAID-IN      EARNINGS
                                        SHARES         AMOUNT       CAPITAL      (DEFICIT)     OTHER        TOTAL

<S>                                     <C>          <C>          <C>           <C>          <C>          <C>
BALANCE, June 29, 1996                  5,041,544    $      50    $  28,162     $  2,794     $      -     $  31,006

Net income                                                                           225                        225

Adjustment for minimum
pension liability                                                                                (131)         (131)
                                      -----------    ---------    ---------     --------     --------     ---------

BALANCE, June 28, 1997                  5,041,544           50       28,162        3,019         (131)       31,100

Net loss                                                                         (17,213)                   (17,213)

Adjustment for minimum
pension liability                                                                                 131           131
                                      -----------    ---------    ---------     --------     --------     ---------

BALANCE, June 27, 1998                  5,041,544           50       28,162      (14,194)           -        14,018

Net loss                                                                         (13,572)                   (13,572)
                                      -----------    ---------    ---------      -------     --------     ---------

BALANCE, July 3, 1999                   5,041,544    $      50    $  28,162     ($27,766)    $      -     $     446
                                        =========    =========    =========      =======     ========     =========
</TABLE>


SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.


                                      F-4
<PAGE>

                GIBRALTAR PACKAGING GROUP, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
            YEARS ENDED JULY 3, 1999, JUNE 27, 1998 AND JUNE 28, 1997
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                            1999             1998              1997
<S>                                                                     <C>            <C>             <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
     Net income (loss)                                                  ($13,572)        ($17,213)     $        225
     Adjustments to reconcile net income (loss) to
     net cash flows from operating activities:
         Extraordinary item - write-off of finance charges                     -                -               173
         Impairment write-down of long-lived assets                       12,213           14,083                 -
         Depreciation and amortization                                     3,062            4,993             3,977
         (Gain) loss on sale of property, plant and equipment                (12)             (27)               32
         Deferred income taxes                                              (905)          (1,849)                -
         Changes in operating assets and liabilities:
              Accounts receivable - net                                      422            1,020            (1,980)
              Inventories                                                  1,927           (1,661)              166
              Prepaid expenses and other assets                                7             (197)              213
              Accounts payable                                            (2,951)           4,477              (421)
              Income taxes payable                                           (93)            (492)              424
              Accrued expenses and other liabilities                         412             (306)              275
                                                                      ----------       ----------        ----------

     Net Cash Flows from Operating Activities                                510            2,828             3,084
                                                                      ----------       ----------        ----------


CASH FLOWS FROM INVESTING ACTIVITIES:
     Proceeds from sale of property, plant and equipment                     693              103                28
     Purchases of property, plant and equipment                           (1,245)          (2,143)           (2,640)
                                                                      ----------       ----------        ----------

     Net Cash Flows from Investing Activities                               (552)          (2,040)           (2,612)
                                                                      ----------       ----------        ----------

CASH FLOWS FROM FINANCING ACTIVITIES:
     Net borrowings under revolving credit facility                        2,998            3,149               356
     Net principal repayments of long-term debt                          (32,943)          (3,801)          (30,557)
     Net repayments under capital leases                                     (39)            (137)             (103)
     Proceeds from issuance of long-term debt                             30,830                -            31,050
     Refinancing costs                                                      (720)               -            (1,173)
                                                                      -----------      ----------        ----------

     Net Cash Flows from Financing Activities                                126             (789)             (427)
                                                                      ----------       ----------        ----------

NET INCREASE (DECREASE) IN CASH                                               84               (1)               45

CASH AT BEGINNING OF YEAR                                                    114              115                70
                                                                      ----------       ----------        ----------


CASH AT END OF YEAR                                                   $      198       $      114        $      115
                                                                      ==========       ==========        ==========


SUPPLEMENTAL DISCLOSURE:
     Income taxes paid                                                $      247       $      899        $       62
                                                                      ==========       ==========        ==========
     Interest paid                                                    $    3,116       $    2,997        $    2,376
                                                                      ==========       ==========        ==========
SCHEDULE OF NON-CASH INVESTING
AND FINANCING ACTIVITIES:
     Capital lease obligations                                        $       82       $       61        $      198
                                                                      ==========       ==========        ==========
</TABLE>

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.


                                      F-5
<PAGE>

                GIBRALTAR PACKAGING GROUP, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
         THREE YEARS ENDED JULY 3, 1999, JUNE 27, 1998 AND JUNE 28, 1997


1.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

PRINCIPLES OF CONSOLIDATION - The accompanying consolidated financial statements
include the accounts of Gibraltar Packaging Group, Inc. (the "Company") and its
wholly owned subsidiaries; RidgePak Corporation (dba "Flashfold Carton"),
Standard Packaging & Printing Corporation ("Standard Packaging"), Niemand
Industries, Inc. ("Niemand") and GB Labels, Inc. ("GB Labels"). All significant
intercompany accounts and transactions have been eliminated.

DESCRIPTION OF BUSINESS - The Company designs and manufactures high quality
specialty packaging products in facilities located in Nebraska, Indiana, Alabama
and North Carolina, and markets these products primarily to customers throughout
the United States. The Company's products include folding cartons, specialty
laminated containers, flexible packaging, tubular packaging and contract
packaging and filling for a wide range of businesses. Based on the nature of the
product, the production processes, types of customers, and methods used to
distribute products, the Company operates in one reportable segment.

FISCAL YEAR - The Company ends its fiscal year on the Saturday closest to June
30.

CASH AND CASH EQUIVALENTS - The Company considers all highly liquid financial
instruments purchased with a maturity of three months or less to be cash
equivalents. The Company utilizes a cash management system that includes zero
balance accounts. Negative cash balances for such accounts, resulting from
outstanding checks, are reclassified to checks not yet presented in the
consolidated financial statements.

ACCOUNTS RECEIVABLE - The changes in the allowance for doubtful accounts
receivable consist of the following (in thousands):

<TABLE>
<CAPTION>
                                                                                   YEARS ENDED
                                                                ----------------------------------------------
                                                                    JULY 3           JUNE 27          JUNE 28
                                                                      1999              1998             1997

<S>                                                             <C>               <C>              <C>
     Allowance, Beginning of Year                               $      162        $      127       $      231
     Provision for Uncollectible Accounts                              122               184               74
     Write-off of Uncollectible Accounts                               (90)             (149)            (178)
                                                                ----------        ----------       ----------

     Allowance, End of Year                                     $      194        $      162       $      127
                                                                ==========        ==========       ==========
</TABLE>

INVENTORIES - Inventories are stated at the lower of cost (first-in, first-out
method) or market.

PROPERTY, PLANT AND EQUIPMENT - Depreciation is provided using the straight-line
method over the following estimated useful lives:

     Buildings                                                   30 years
     Machinery and equipment                                   2-20 years
     Vehicles                                                   3-8 years
     Furniture and fixtures                                    3-10 years


                                      F-6
<PAGE>

EXCESS OF PURCHASE PRICE OVER NET ASSETS ACQUIRED - The excess of the purchase
price over the net assets acquired is being amortized over a forty-year period
on a straight-line basis. The carrying value of goodwill is evaluated in
relation to the operating performance and future undiscounted net cash flows of
the related acquired businesses.

IMPAIRMENT OF LONG-LIVED ASSETS - Recoverability of long-lived assets not held
for sale are evaluated by measuring the carrying amount of the assets against
the estimated undiscounted future cash flows associated with them. Based on
these evaluations, there were no adjustments to the carrying value on long-lived
assets in fiscal 1997.

At the end of the third quarter of fiscal 1999, the Company recorded a charge of
$11.8 million to write-down the carrying amount of goodwill and fixed assets of
Flashfold Carton to estimated fair value. Estimated fair value was determined by
discounting future cash flows.

The Flashfold Carton facility has been experiencing declining sales and
profitability for the past three years. In the first quarter of fiscal 1999, the
facility was put under the operating control of the Gibraltar Packaging Group,
Inc. (dba "Great Plains Packaging", or "Great Plains") management team in an
attempt to improve operating results. Management's projections of future
operating cash flows during the first two quarters of fiscal 1999 continued to
reflect planned operating improvements. During the third quarter of fiscal 1999,
it was determined that the planned operating improvements could not be realized
in the time period or to the degree estimated. The impairment loss resulted in a
complete write-off of goodwill and reducing the carrying value of fixed assets
at Flashfold Carton.

In connection with a modification of the Company's strategic plan, the Company
has or is in the process of divesting of the assets of two of its subsidiaries,
GB Labels and Niemand. The evaluation of the recoverability of long-lived assets
held for sale are based on comparing the assets carrying amount with its fair
value less cost to sell. The sale of the assets of GB Labels was effective
August 30, 1999. The Company recorded a pre-tax non-cash charge of $82,000 in
the fourth quarter of fiscal 1999 to write-down the carrying amount of GB
Labels' fixed assets sold to fair value less cost to sell. No gain or loss will
be recorded on the sale in fiscal 2000. Additionally, the Company recorded a
pre-tax non-cash charge of $0.3 million to write-down the carrying amount of the
retained real property of GB Labels to estimated fair value.

In the fourth quarter of fiscal 1998, the Company recorded a pre-tax non-cash
charge of $14.1 million to write-down the carrying amount of goodwill and fixed
assets of Niemand to estimated fair value less cost to sell. Due to
uncertainties inherent in the estimation process, it is reasonably possible that
the ultimate loss on the sale of Niemand may vary from the current estimate. The
sale of the container business of Niemand was finalized in the fourth quarter of
fiscal 1999. The Company is in negotiations with Niemand management for the sale
of the remaining assets of Niemand. The Company anticipates completing the
divestiture of the remaining assets of Niemand by the end of the second quarter
of fiscal 2000.

OTHER ASSETS - Costs associated with obtaining financing arrangements are
included in other assets. At June 27, 1998, unamortized financing costs of $0.9
million related to the credit agreement with Harris Trust and Savings Bank
("Harris Bank") were amortized as a result of the acceleration of the maturity
date of such credit agreement to August 1998. In July 1998, the Company
capitalized approximately $0.8 million, representing the cost of refinancing its
debt under a new credit facility as described in Note 4.

REVENUE RECOGNITION - Sales and related cost of sales are recognized upon the
earlier of shipment of products or acceptance by the customer.


                                      F-7
<PAGE>


EARNINGS PER SHARE - Basic earnings per share data are based on the weighted
average outstanding common shares during the period. Diluted earnings per share
data are based on the weighted average outstanding common shares and the effect
of all dilutive potential common shares, including stock options.

NEW ACCOUNTING PRONOUNCEMENTS - In June 1998, SFAS No. 133, ACCOUNTING FOR
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES, was issued. This statement will
become effective in fiscal 2001. The Company has not quantified the impact, if
any, resulting from the adoption of this standard.

USE OF ESTIMATES - The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.

RECLASSIFICATION - Certain amounts in the fiscal 1998 and 1997 financial
statements have been reclassified to conform with the fiscal 1999 presentation.


2.  INVENTORIES

Inventories consisted of the following (in thousands):

                                                 JULY 3               JUNE 27
                                                   1999                  1998

Finished goods                               $    5,060            $    6,506
Work in process                                     913                 1,396
Raw materials                                     1,699                 2,319
Manufacturing supplies                              355                   446
                                             ----------            ----------

                                             $    8,027            $   10,667
                                             ==========            ==========


3. PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment (at cost) consisted of the following (in
thousands):

                                                JULY 3               JUNE 27
                                                  1999                  1998

     Land                                   $      707            $      699
     Buildings                                  11,846                11,558
     Machinery, equipment
       and vehicles                             25,243                28,023
     Furniture and fixtures                      2,032                 2,191
     Construction-in-progress                      371                   808
                                            ----------            -----------
                                                40,199                43,279
     Less accumulated depreciation              19,017                17,917
                                            ----------            -----------
                                            $   21,182            $   25,362
                                            ==========            ==========



4.  FINANCING AGREEMENTS

                                      F-8
<PAGE>

Long-term debt consisted of (columnar amounts in thousands):

<TABLE>
<CAPTION>

                                                                                        JULY 3          JUNE 27
                                                                                          1999             1998
<S>                                                                                      <C>            <C>
First Source term loan, quarterly principal payments of $562,500 through July
   1999, $625,000 through October 1999, monthly principal payments of $208,333
   through July 2000 and $229,167 through April 2003, with the balance of
   $12,687,500 due on July 31, 2003, interest is payable monthly.                 $     22,579     $          -

Revolving credit facility,  matures July 31, 2003,  interest is payable
   monthly.                                                                              8,150                -

Harris Bank term loan,  monthly principal  payments of $312,500 through
   August 1, 1998, paid off on August 10, 1998.                                              -           20,000

Revolving credit facility, paid off on August 10, 1998.                                      -            9,099

Note payable, for capital expansion of Marion, Alabama facility, due in monthly
   principal and interest installments, paid off on August 10, 1998.                         -              746

Capital lease obligations                                                                  105               61
                                                                                  ------------     ------------
Total                                                                                   30,834           29,906
Less current portion                                                                     2,891            2,034
                                                                                  ------------     ------------
Long-term debt                                                                    $     27,943     $     27,872
                                                                                  ============     ============
</TABLE>

Through various amendments of the credit agreement during fiscal 1998, the
Company and Harris Bank agreed to accelerate the maturity of the Company's bank
credit agreement to August 10, 1998, and to eliminate all financial covenants as
of June 27, 1998. The Company's bank credit agreement with Harris Bank consisted
of a $25 million term loan and a $10 million revolving credit facility. At June
27, 1998, both facilities bore interest at the bank's prime rate plus 1%. The
banks prime rate was 8.5% at June 27, 1998.

On July 31, 1998, the Company refinanced its debt. The Company's new credit
facility with First Source Financial LLP ("First Source") provides for a five
year $25 million term loan and a five year $15 million working capital revolving
line of credit ("Revolver").

The proceeds from the credit facility were used to refinance the Harris Bank
credit facility, to repay a note payable related to the Alabama facility, to pay
the related transactions costs, and to fund the working capital and capital
expenditure needs of the Company. The credit facility is secured by a first
priority perfected security interest in and lien on all assets (real and
personal, tangible and intangible) of the Company excluding the Burlington,
North Carolina property.

The Revolver provides for a revolving line of credit under a borrowing base
commitment subject to certain loan availability requirements. Loan availability
under the Revolver may not exceed the lesser of (1) $15 million or (2) the sum
of (a) up to 85% of the Company's eligible accounts receivable plus (b) up to
60% of the Company's eligible inventory. At no time may the sum of aggregated
loan advances outstanding under the Revolver plus the aggregated amount of
extended letter of credit guarantees exceed loan availability.

As of July 3, 1999, all outstanding letters of credit are guaranteed by First
Source. The Company pays a letter of credit fee of 2.75% to guarantee
availability under the Revolver. Outstanding letters of credit at July 3, 1999
amounted to $222,000 and relate to workman's compensation

                                      F-9
<PAGE>

insurance policies.

The First Source credit facility contains certain restrictive covenants
including financial covenants related to Net Worth, Minimum Interest Coverage
Ratio, Capital Expenditures, Debt Ratio and Fixed Charge Coverage. As of July 3,
1999, the Company was not in compliance with certain financial covenants. First
Source has waived the covenant violations relating to Net Worth, Minimum
Interest Coverage Ratio, Capital Expenditures, Debt Ratio and Fixed Charge
Coverage as of July 3, 1999.

The Revolver currently bears interest at First Source's prime rate plus 1.25%,
while the term loan currently bears interest at First Source's prime rate plus
1.75%. The Company also pays a commitment fee of 0.5% on the difference between
the average daily loan balance and the amount of the Revolver. First Source's
prime rate was 8% at July 3, 1999.

During fiscal 1997, the Company purchased an interest rate cap agreement to
reduce the impact of changes in interest rates. The cap agreement entitled the
Company to receive from the counterparty (a major bank) the notional amount
multiplied by the differences between the variable 1-month LIBOR and cap rates
when the 1-month LIBOR exceeds the quoted cap rate of 10%. The above agreement
matured on June 30, 1998 and the related premium was fully amortized at June 27,
1998.

Anticipated maturities of long-term debt subsequent to July 3, 1999, pursuant to
the credit facility and future minimum payments under finance leases, are as
follows (in thousands):

                                                                  AMOUNTS
             2000                                             $     2,891
             2001                                                   2,751
             2002                                                   2,773
             2003                                                   2,312
             2004                                                  20,107
                                                              -----------
            Total                                             $    30,834
                                                              ===========


5.       INCOME TAXES

The provision (benefit) for income taxes consists of the following (in
thousands):

                                   JULY 3           JUNE 27          JUNE 28
                                     1999              1998             1997
     Current:
       Federal                 $       71        $       50       $      478
       State                           83               364               31
     Deferred                        (905)           (1,849)              50
                               ----------        ----------       ----------

                                    ($751)          ($1,435)      $      559
                               ==========        ==========       ==========


                                      F-10
<PAGE>

The following represents a reconciliation between the actual income tax expense
and income taxes computed by applying the statutory federal income tax rate to
income (loss) before income taxes:

<TABLE>
<CAPTION>

                                                                        JULY 3         JUNE 27        JUNE 28
                                                                          1999            1998           1997
<S>                                                                   <C>             <C>          <C>
     Statutory rate                                                   ($4,870)        ($6,341)     $      303
     State income tax effect                                             (215)            (84)             33
     Increase in valuation allowance                                     1,176               -              -
     Disallowed losses with respect
       to impaired asset writedown                                       3,023           4,788              -
     Amortization of excess of purchase price over
       net assets acquired                                                 117             199            199
     Other - net                                                            18               3             24
                                                                     ---------      ----------     ----------
     Total                                                               ($751)       ($1,435)     $      559
                                                                     ---------      ---------      ----------
</TABLE>

Deferred income tax (liabilities) assets result from reporting income and
expenses in different periods for tax and financial reporting purposes. The
deferred tax liabilities and assets are comprised of the following (in
thousands):

                                                       JULY 3    JUNE 27
                                                         1999       1998
Deferred income tax assets:
     Difference in basis of amortizable assets        $   961    $ 1,006
     Non-deductible accrued liabilities                 1,258      1,121
     Net operating loss carryforwards of
         a subsidiary company                             812        812
     State net operating loss carryforwards             1,492        937
     State tax credits carryforward                       986        930
     Federal net operating loss carryforward            2,457      1,812
     AMT credit carryforward                              385        385
     Differences in the basis of inventory
         for tax purposes                                 179        241
     Other - net                                           27       --
                                                      -------    -------

Total                                                   8,557      7,224
Deferred tax asset valuation allowance                 (4,325)    (3,149)
                                                      -------    -------

      Net                                               4,232      4,095
                                                      -------    -------

     Deferred tax liabilities:
       Difference in basis of property, plant
         and equipment                                 (3,597)    (4,491)
       Other                                             (497)      (371)
                                                      -------    -------
     Total                                             (4,094)    (4,862)
                                                      -------    -------

     Net deferred income tax asset (liability)        $   138    ($  767)
                                                      =======    =======


                                      F-11
<PAGE>

At July 3, 1999, the Company had the following tax net operating loss
carryfowards for federal income tax purposes (in thousands):

     EXPIRATION                                               AMOUNTS
        2007                                              $       447
        2008                                                      665
        2009                                                      930
        2010                                                    2,037
        2011                                                      409
        2012                                                      267
        2013                                                    3,271
        2019                                                    1,242
                                                          -----------
        Total                                             $     9,268
                                                          ===========

Approximately $2.0 million of such losses relate to a subsidiary company, which
are available to be utilized only against future taxable income of such
subsidiary.

At July 3, 1999, the Company had a state investment tax credit carryforward of
approximately $1.0 million which expires if unutilized by the year 2005. These
credits are available to offset both Nebraska state income tax and Nebraska
sales tax on qualifying purchases.

6.       EMPLOYEE BENEFIT PLANS

The Company maintains a noncontributory defined benefit pension plan (the
"benefit plan") covering substantially all of the RidgePak Corporation hourly
employees fulfilling participation requirements. Benefits are based on the
employee's years of credited service. The Company's funding policy is to
contribute annually the minimum amount required under ERISA. Plan assets are
held by an independent trustee and consist of U.S. Government securities, time
deposits, common stocks, corporate bonds and collective investment funds.

The change in benefit obligation and plan assets and the reconciliation of
funded status for the years presented included the following components (dollars
in thousands):

<TABLE>
<CAPTION>

                                                                               JULY 3        JUNE 27
                                                                                 1999           1998
<S>                                                                       <C>            <C>
     Change in benefit obligations:
       Benefit obligation at beginning of year                            $       536    $       467
       Service cost                                                                58             49
       Interest cost                                                               32             34
       Actuarial (gain)/loss                                                      (70)            53
       Benefits paid                                                              (27)           (67)
                                                                          -----------    -----------
       Benefit obligation at end of year                                          529            536
                                                                          -----------    -----------

     Change in plan assets:
       Fair value of plan assets at beginning of year                             592            428
       Actual return on plan assets                                                37             98
       Employer contribution                                                        -            133
       Benefits paid                                                              (27)           (67)
                                                                          -----------    -----------
       Fair value of plan assets at end of year                                   602            592
                                                                          -----------    -----------

     Reconciliation of funded status:
       Plan assets in excess of projected benefit obligation                       73             57
       Unrecognized loss                                                           51            117
                                                                          -----------    -----------
       Prepaid pension cost recognized on balance sheet                   $       124    $       174
                                                                          ===========    ===========

     Discount rate used to calculate the above liability                        7.50%          6.50%
</TABLE>

                                      F-12
<PAGE>

The net periodic pension cost and assumptions used for the years presented
included the following components (dollars in thousands):

<TABLE>
<CAPTION>

                                                                        JULY 3         JUNE 27        JUNE 28
                                                                          1999            1998           1997
<S>                                                                <C>             <C>            <C>
     Service cost-benefits earned during the period                $        58     $        49    $        43
     Interest cost on projected benefit obligation                          32              34             30
     Expected return on plan assets                                        (44)            (38)           (33)
     Amortization of loss                                                    5               6              5
                                                                   -----------     -----------    -----------
     Net periodic pension cost                                     $        51     $        51    $        45
                                                                   ===========     ===========    ===========

     Discount rate used to calculate expense                              6.50%           7.50%          7.75%
     Expected long-term rate of return on plan assets                     8.00%           8.00%          8.00%
</TABLE>

The Company also sponsors a defined contribution 401(k) plan (the "Gibraltar
Plan"). Employees are eligible to participate in the Gibraltar Plan upon
completion of six months of credited service. Participants fully vest in Company
contributions after five years with partial vesting after one year. An employee
may contribute up to 15% of his or her earnings on a pre-tax basis subject to
IRS limitations. The Company matches 25% of an employee's contribution up to a
maximum of 4% of eligible compensation. The Company also makes a quarterly
profit sharing contribution when the earnings per share of Gibraltar stock is
$0.15 per share or higher in any fiscal quarter. The profit sharing portion of
each participant's account is invested in Gibraltar stock.

The Company's contributions to the Gibraltar Plan for the years ended July 3,
1999, June 27, 1998 and June 28, 1997 were approximately $115,000, $94,000 and
$77,000, respectively.


7.  STOCK OPTION PLANS

The 1992 Incentive Stock Option Plan (the "1992 Plan") provides for grants to
key employees of the Company of options to purchase in the aggregate up to
300,000 shares of the Company's common stock with exercise prices equal to or
greater than the market price at the date of grant. Options granted under the
1992 Plan are exercisable no earlier than six months and no later than ten years
from the grant date.

The Director Stock Option Plan (the "Directors Plan") provides for each
independent director to receive a grant of an option to purchase 3,000 shares of
the Company's common stock at an exercise price equal to the market price at the
date such person is elected to the board. Options granted under the Directors
Plan are exercisable no earlier than six months and no later than ten years from
the grant date.

Effective November 30, 1998, the Company's 1996 Non-Qualified Stock Option Plan
was terminated. There were 225,000 shares granted under that plan in fiscal
1997, with vesting based on meeting certain financial criteria. This termination
was the direct result of the adoption of the 1998 Stock Appreciation Rights Plan
(referenced below).

On November 30, 1998, the Company established the 1998 Stock Appreciation Rights
Plan (the "Plan") to be administered by the Compensation Committee of the
Company's Board of Directors. The Plan provides for the discretionary granting
of stock appreciation rights ("SAR") to key employees of the Company. SARs held
by grantees under the Plan entitle the holder to cash payments only.

Effective January 15, 1999, 150,000 SARs valued at $2.25 each and 150,000 SARs
valued at $3.00 each were granted to officers of the Company. The SARs vest at
20% per year through the maturity date of June 30, 2003. No compensation expense
has been recorded related to this plan,

                                      F-13
<PAGE>

since the value of the SARs exceed the current trading price of the stock.

A summary of stock option transactions under the Company's employee option plans
and the Director's stock plan for each of the three years in the period ended
July 3, 1999 is as follows:

<TABLE>
<CAPTION>

                                                                                             WEIGHTED AVERAGE
                                                                          SHARES              EXERCISE PRICE
                                                                          ------              --------------
<S>                                                                        <C>                         <C>
     Outstanding at June 29, 1996                                          139,334              $      7.54
          Granted                                                          225,000                     4.00
          Exercised                                                              -                     -
          Canceled or Lapsed                                               (47,500)                    7.91
                                                                      ------------              -----------
     Outstanding at June 28, 1997                                          316,834                     4.97
          Granted                                                                -                     -
          Exercised                                                              -                     -
          Canceled or Lapsed                                               (36,000)                    6.85
                                                                      ------------              -----------
     Outstanding at June 27, 1998                                          280,834                     4.73
          Granted                                                                -                     -
          Exercised                                                              -                     -
          Canceled or Lapsed                                              (228,000)                    4.07
                                                                      ------------              -----------
     Outstanding at July 3, 1999                                            52,834              $      7.59
                                                                      ============              ===========

     Shares exercisable at June 28, 1997                                   127,334              $      6.04
     Shares exercisable at June 27, 1998                                   100,834              $      6.03
     Shares exercisable at July 3, 1999                                     52,834              $      7.59
</TABLE>


The following table summarizes information about stock options outstanding at
July 3, 1999:

<TABLE>
<CAPTION>
                                             Weighted
         Range of                         Avg. Remaining       Weighted                         Weighted
         Exercise          Number           Contractual         Average           Number         Average
          Prices         Outstanding           Life         Exercise Price     Exercisable     Exercisable
          ------         -----------           ----         --------------     -----------     -----------
<S>                        <C>               <C>            <C>                   <C>          <C>
       $6.00 - $6.50       22,334            3.0 years      $    6.02             22,334       $     6.02
       $8.00 - $9.00       30,500            4.7 years           8.74             30,500             8.74
                           ------            ---------           ----             ------             ----
                           52,834            4.0 Years      $    7.59             52,834       $     7.59
</TABLE>

                                      F-14
<PAGE>

The Company accounts for its stock-based compensation under the provisions of
APB Opinion 25, "Accounting for Stock Issued to Employees," which utilizes the
intrinsic value method. No compensation cost has been recognized related to the
Company's stock option plans. Had compensation cost been determined based on the
fair value of the options at the date of grant consistent with the requirements
of Statement of Financial Accounting Standards No. 123, "Accounting for
Stock-Based Compensation," the Company's net income (loss) and earnings per
share would have been reduced to the pro forma amounts indicated below:

<TABLE>
<CAPTION>
                                                                 JULY 3         JUNE 27             JUNE 28
                                                                   1999             1998              1997
<S>                                                            <C>               <C>                 <C>
     Net income (loss) applicable to common shareholders
                                      As reported              ($13,572)         ($17,213)           $ 225
                                      Pro forma                ($13,572)         ($17,242)           $ 199

     Net income (loss) per basic and diluted common share
                                      As reported                ($2.69)           ($3.41)           $0.05
                                      Pro forma                  ($2.69)           ($3.42)           $0.04
</TABLE>

The fair value of stock options granted in fiscal 1997 was estimated at the date
of grant using the Black-Scholes option pricing model with the following
weighted-average assumptions:

                                                                    JUNE 28
                                                                     1997

     Risk free interest rate                                          6.1%
     Expected life of option grants                                   4
     Expected volatility                                             32.0%
     Expected dividend yield                                           0

At July 3, 1999, the stock option exercise prices for the two existing plans
exceeded the market value of the Company's common stock and therefore the
options are excluded from the Company's earnings per share calculation.


8.  COMMITMENTS AND CONTINGENCIES

OPERATING LEASES - The Company leases office and manufacturing space,
manufacturing equipment, computer equipment, vehicles and warehouse space under
non-cancelable operating leases. Rent expense for the years ended July 3, 1999,
June 27, 1998 and June 28, 1997 under such lease agreements was approximately
$1,584,000, $1,396,000 and $960,000, respectively. As of July 3, 1999,
approximate minimum future lease commitments were as follows (in thousands):
                                                                         AMOUNTS
                                    2000                             $     1,377
                                    2001                                   1,204
                                    2002                                     834
                                    2003                                     562
                                    2004                                     391
                               Thereafter                                    171
                                                                     -----------
                                    Total                            $     4,539
                                                                     ===========

                                      F-15
<PAGE>

LEGAL PROCEEDINGS - From time to time, the Company is a party to certain
lawsuits and administrative proceedings that arise in the conduct of its
business. While the outcome of these lawsuits and proceedings cannot be
predicted with certainty, management believes that, if adversely determined, the
lawsuits and proceedings, either singularly or in the aggregate, would not have
a material adverse effect on the financial condition, results of operations, or
net cash flows of the Company.

ENVIRONMENTAL MATTERS - In May 1995, the Company discovered groundwater
contamination at its Burlington, North Carolina facility. Based on work
performed by its environmental consultants, the Company established a reserve of
$750,000 for such remediation costs in fiscal 1995. The Company's accrual for
such remediation costs included in other long-term liabilities on the
Consolidated Balance Sheet approximates $475,000 and $578,000 as of July 3, 1999
and June 27, 1998, respectively. Incurred expenses as of July 3, 1999 related to
remediation totaled $275,000. In June of 1998, the Company completed a follow-up
assessment of the facility which was then filed with the Division of Water
Quality ("DWQ"). The Company is awaiting a reply from the DWQ. Management
believes that the ultimate resolution of this and other environmental matters
will not materially affect the financial position or results of future
operations and cash flows of the Company.


9.  RELATED PARTY TRANSACTIONS

Certain officers of the Company hold an equity interest in Rostra Technologies,
Inc. ("Rostra"), a related party. During fiscal years 1999, 1998 and 1997, the
Company paid $158,000, $452,000 and $389,000, respectively, to Rostra in
management fees for services provided by the Company's CEO and CFO. Effective
October 1997, the Company ceased paying management fees to Rostra for the
Company's CEO. Effective January 1999, the Company ceased paying management fees
to Rostra for the Company's CFO. At July 3, 1999 and June 27, 1998, the Company
owed Rostra $0 and $66,029, respectively, for unpaid fees.


10.      SEVERANCE, OFFICE MOVING AND RESTRUCTURING CHARGES

In recent years, the Company has restructured its corporate headquarters and
certain aspects of its business in an effort to reduce its cost structure and
remain competitive in its markets. Restructuring charges primarily involve the
separation of employees, moving costs and similar actions. Costs for
restructuring activities are limited to incremental costs that directly result
from the restructuring activities and provide no future benefit to the Company.

In the second quarter of fiscal 1998, the Company approved a plan to reduce
costs through a series of organizational and facility consolidations. A
restructuring charge of $170,000 was recorded relating to severance costs for
divisional personnel. Other costs of approximately $500,000 relating to the
reorganization are included in general and administrative expenses and consist
of severance and relocation costs.

In the second quarter of fiscal 1999, the Company approved a plan to further
reduce costs by closing the Company's corporate office and moving the Company's
corporate functions to its Hastings, Nebraska facility. The move was completed
on November 2, 1998. A restructuring charge of $235,000 was recorded consisting
of severance costs for two corporate personnel ($74,000), the write-off of
leasehold improvements ($61,000) and moving costs ($100,000) associated with
relocating the corporate functions to its Hastings, Nebraska facility.

At July 3, 1999, June 27, 1998 and June 28, 1997, accrued liabilities and other
long-term liabilities included approximately $169,000, $222,000 and $300,000,
respectively, in restructuring charges, primarily relating to severance costs.
The change in these reserves is the result of direct cash outflows related to
the restructuring.

                                      F-16
<PAGE>

11.      MAJOR CUSTOMERS

Sales to one customer represented approximately 11.8%, 11.1% and 11.0% of net
sales in fiscal years 1999, 1998 and 1997, respectively.


12.      FAIR VALUE OF FINANCIAL INSTRUMENTS

The carrying amount of cash, accounts receivable and accounts payable
approximates fair value because of the short-term maturity of these instruments.

The carrying value of the Company's borrowings under its long-term revolving
credit agreement and other long-term borrowings approximates fair value based on
quoted market prices for the same or similar instruments.

The fair value of the Company's letters of credit is based on fees currently
charged for similar agreements or on the estimated cost to terminate or settle
the obligations. As of July 3, 1999, the fair value of the letters of credit was
$222,000.


13.      QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)

The following is a summary of the quarterly results of operations for the years
ended July 3, 1999 and June 27, 1998 (in thousands, except per share data):

<TABLE>
<CAPTION>
                                                            QUARTER ENDED
                            ------------------------------------------------------------------------
         1999                   SEPTEMBER 30        DECEMBER 31(1)    MARCH 31(2)         JULY 3(3)            YEAR

<S>                         <C>                <C>              <C>               <C>              <C>
Net Sales                   $        20,185    $       18,980   $       19,015    $       18,334   $         76,514
Gross Profit                          3,221             2,958            1,917             2,707             10,803
Net Loss                               (177)             (237)         (12,634)             (524)           (13,572)
Per Common Share Amounts:
(basic and diluted)

Net Income (Loss)           $         (0.04)   $        (0.05)  $         (2.51)  $        (0.10)  $          (2.69)


                                                            QUARTER ENDED
                            ------------------------------------------------------------------------
         1998                   SEPTEMBER 30        DECEMBER 31(4)    MARCH 31           JUNE 27(5)            YEAR

Net Sales                   $        19,328    $       18,619   $       18,954    $       18,989   $         75,890
Gross Profit                          3,547             2,224            3,164             2,817             11,752
Net Income (Loss)                        14            (1,877)            (137)          (15,213)           (17,213)
Per Common Share Amounts:
(basic and diluted)

Net Income (Loss)           $             -    $       (0.37)   $       (0.03)    $       (3.01)   $         (3.41)
</TABLE>


(1)      The second quarter of fiscal 1999 net loss includes a $235
         restructuring charge consisting of severance costs for corporate
         personnel, the write-off of leasehold improvements and moving costs
         associated with relocating the corporate functions to its Hastings,
         Nebraska facility.

                                      F-17
<PAGE>

(2)      The third quarter of fiscal 1999 net loss includes an impairment
         write-down of long-lived assets related to Flashfold Carton of $11,861.
         Gross margins at Flashfold Carton were below the prior year.

(3)      The fourth quarter of fiscal 1999 net loss includes an impairment
         write-down of long-lived assets related to GB Labels of $352.

(4)      Included in the second quarter of fiscal 1998 net loss is a charge for
         severance and relocation costs of $500 and a restructuring charge of
         $170 consisting of severance costs for divisional personnel.

(5)      The fourth quarter of fiscal 1998 net loss includes an impairment write
         down of long-lived assets related to Niemand of $14,083, and a
         write-off of unamortized finance costs related to the Harris Bank
         refinancing of $854.


                                      F-18