<PAGE>   1




                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                    FORM 10-K

              Annual Report Pursuant to Section 13 or 15(d) of the
                        Securities Exchange Act of 1934

 For the fiscal year ended September 30, 2000. Commission file number 0-21018.

                            TUFCO TECHNOLOGIES, INC.
                            ------------------------
             (Exact name of registrant as specified in its charter)


               Delaware                                        39-1723477
 ---------------------------------                        --------------------
   (State of other jurisdiction                           (IRS Employer ID No.)
 of incorporation or organization)

                     4800 Simonton Road, Dallas, Texas 75244
                    ----------------------------------------
                    (Address of principal executive offices)

                                 (972) 789-1079
                                 --------------
                         (Registrant's telephone number)

     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 all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

                                 Yes X     No
                                    ---      ---

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulations 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 this
Form 10-K. [X]

The aggregate market value of the Common Stock of Tufco Technologies, Inc. held
by non-affiliates, as of December 14, 2000, was approximately $11,042,293. Such
aggregate market value was computed by reference to the closing price of the
Common Stock as reported on the NASDAQ National Market on December 14, 2000. For
purposes of making this calculation only, the registrant has defined affiliates
as including all directors and beneficial owners of more than ten percent of the
Common Stock of the Company. The number of shares of the registrant's Common
Stock outstanding as of December 14, 2000 was 4,675,019.

                       DOCUMENTS INCORPORATED BY REFERENCE

Portions of the registrant's definitive proxy statement for its Annual Meeting
of Stockholders to be held in 2001 are incorporated by reference into Part III
of this report.


<PAGE>   2


                                     PART I

ITEM 1 - BUSINESS

GENERAL

         Tufco Technologies, Inc. ("Tufco" or the "Company") provides
diversified contract manufacturing and specialty printing services, manufactures
and distributes business imaging paper products, and distributes paint sundry
products used in home improvement projects. Since 1992 and until its
organizational restructuring on February 7, 1997, the Company operated as three
wholly owned subsidiaries, Tufco Industries, Inc., Executive Converting
Corporation ("ECC") and Hamco Industries, Inc. ("Hamco"). On January 28, 1994,
the Company completed an initial public offering in which the Company issued and
sold 900,000 shares of its Common Stock, par value $.01 per share ("Common
Stock"), and certain stockholders of the Company sold 50,000 shares of Common
Stock. Contemporaneously with the closing of the Company's public offering, the
Company acquired, through ECC, substantially all of the assets of Executive
Roll Manufacturing, Inc., d/b/a Executive Converting Corporation for $7.5
million and 127,778 shares of Common Stock. On August 23, 1995, the Company
acquired, through Hamco, substantially all of the assets of Hamco, Inc. for
approximately $12.9 million in cash. On February 7, 1997, the Company
reorganized its corporate structure to better serve its business needs. Through
this restructuring, the net assets of Tufco Industries, Inc., ECC and Hamco were
transferred to Tufco, L.P., a Nevada limited partnership, in which Tufco Tech,
Inc. is the sole managing general partner and is wholly owned by the Company. On
November 13, 1997 the Company purchased all of the outstanding common stock of
Foremost Manufacturing Company, Inc. for $5.9 million and 25,907 shares of
Common Stock.

         Tufco offers a wide array of contract manufacturing services including
thermal laminating, coating, folding, precision slitting and rewinding,
precision sheeting and custom packaging for delivery to the end user. Its
specialty printing services provide wide web, multi-color flexographic and
letterpress printing and adhesive laminations to industrial users and resale
distributors. Tufco also manufactures a wide range of printed and unprinted
business imaging paper products for a variety of business needs, and the
Company's Paint Sundry sector manufactures and distributes products used by
professional painters and do-it-yourself home owners.

         The Company was incorporated in the state of Delaware in 1992 to
acquire Tufco Industries, Inc. Although the Company was organized in 1992, the
business conducted by Tufco Industries, Inc. has been in continuous operation
since 1974. The Company has become a leading provider of contract manufacturing
and specialty printing services, and supplier of value-added custom paper
products, and it has the most complete line of paint sundry products in the
industry. The Company's principal executive offices are located at 4800 Simonton
Road, Dallas, Texas 75244, and its telephone number is (972) 789-1079.

PRODUCTS AND SERVICES

         The Company markets its products and services through three market
sectors: Contract Manufacturing services, Business Imaging paper products, and
Paint Sundry products. Until its exit from the market place in June of fiscal
1999, the Company also produced and distributed a line of Away-From-Home tissue
and towel products. Tufco conducts operations from five manufacturing and
distribution locations in Green Bay, Wisconsin, Manning, South Carolina, Dallas,
Texas, Newton, North Carolina and St. Louis, Missouri.

Contract Manufacturing Market Sector

         Tufco Technologies has contract manufacturing capability at three
locations: Green Bay, Wisconsin, Dallas, Texas and Newton, North Carolina.

         The Company's capabilities at its Green Bay facilities include custom
packaging, coating, cutting, folding, thermal and adhesive laminating, embossed
bonding, slitting and rewinding. These facilities custom convert a wide array of
materials, including polyethylene films, non-woven materials (coated and
uncoated), paper, and tissue. Products include household cleaning wipes, facial
wipes, various health care products, reinforced towels (towels with a
polyethylene or polypropylene mesh to provide strength and durability), medical
drapes, adult hygiene components and polyethylene and paper dropcloths. The
Company has invested in equipment to perform thermal lamination to bond various
material substrates up to 120 inches wide, such as multiply dropcloths,
reinforced material and breathable moisture barrier wraps. Machinery and
equipment at the Green Bay facility have the capability, developed by the
Company's in-house engineers and technical personnel, to combine or modify
various substrates through the use of precise temperature and pressure control.



                                       1
<PAGE>   3


Contract Manufacturing Market Sector (continued)

         The Company's Green Bay facility offers value-added specialty printing
and related graphic arts services, including pre-press work, sheeting,
calendering, printing, finishing, and thermal and adhesive laminating. The
Company provides multi-color printing that uses computerized control to maintain
a high level of print quality. The Company focuses on specialty printing
projects such as paper and poly tablecovers, food and gift-wraps, flexible
packaging, adult hygiene components, and printed release liners. The cornerstone
of the Company's printing operation is its fully automated, state-of-the-art
Windmoeller & Hoelscher (W&H) Astroflex printing press which has the capability
to print up to 54 inches in width at speeds up to 1500 feet per minute.

         Green Bay's pre-press staff prepares projects for printing to customer
specifications. The Company uses the customer's preliminary artwork and arranges
or performs all preparatory processses for camera-ready art, video plate
making, layout, and other related services.

         The Green Bay presses use flexographic and letterpress processes and
can print on a wide range of media from lightweight tissue or non-wovens to
heavyweight paperboard, films and foils. The Company utilizes four wide-web
presses of various sizes, three of which are capable of six-color printing with
the new W&H press at eight colors. The Company uses water-based and oil-based
inks. The presses can accommodate widths up to 82 inches for one-sided printing
and are capable of simultaneous two-sided printing for widths up to 51 inches.
The presses have a variety of print cylinders that provide the Company with the
flexibility to meet customer needs, utilizing lower cost rubber printing plates
that allow the Company to maintain quality and achieve a competitive pricing
advantage for low volume jobs relative to printers using engraved printing
cylinders.

         The Company's Dallas facility has capabilities that include precision
slitting, rewinding, sheeting, specialty packaging, folding, perforating, and
trimming. These capabilities are directed toward converting fine paper materials
including specialty and fine printing papers and paperboards, thermal papers,
polyester films, and coated products.

         The Dallas facility's contract manufacturing services include final
packaging of products, including items on which the Company has performed other
converting or specialty printing services. Packaging capabilities include high
quality bulk skid wrapping, vacuum-sealed carton packed sheets, poly-paper and
poly-film wrapping, and shrink-film packaging. The flexibility of the equipment
at the Dallas facility and the packaging alternatives that the Company can
provide its customers produce finished products that meet and exceed a varied
range of customer specifications and requirements. The Company's Dallas custom
converting services have grown due to the addition of a state-of-the-art
Jagenberg sheeter with specialty paper and paperboard sheeting capabilities and
the investment in a custom designed rewinder for thermal papers and films.

         The Company's Newton facility has capabilities which include precision
slitting and rewinding of paper rolls in a large variety of sizes which include
variables in width, diameter, core size, single or multiply, and color. All of
the rolls can be printed on one side or both, providing the customer with
advertising, promotional or security features.

         The Company's Newton facility also produces a full range of papers for
use in bank proof or teller machines, including fan-fold forms, cards and
printed rolls of various sizes and types. Additionally, the Company produces an
extensive selection of standard and customized guest checks for use in the
restaurant industry, and the Company's Newton facility owns equipment which
enables the Company to produce a wide variety of multi-part business forms.

Business Imaging Market Sector

         The Company produces and distributes a wide variety of printed and
unprinted paper products used in business imaging equipment in market sectors
including architectural and engineering design, high speed data processing,
point of sale, automatic teller machines and a variety of office equipment. The
Company's products include roll products ranging in length from 150 feet to
3500 feet and in widths from 1 inch to 54 inches. Additionally, the Company
produces precision-sheeted products ranging in size from 11 by 17 inches to 65
by 65 inches. The Company's products are available in a wide range of paper
grades including a variety of weights of bond paper, thermal imaging papers,
fine vellums and films and multi-part forms.



                                       2
<PAGE>   4


Paint Sundry Market Sector

         The Company's Manning and St. Louis facilities manufacture and
distribute home improvement products that are sold to paint and hardware
distributors, home centers, and retail paint stores. To provide its customers
with the industry's most complete line of paint sundry products, the Company
supplements the products it manufactures by distributing products manufactured
for the Company by others. Consumer disposable products include polyethylene,
paper and canvas dropcloths, painters' apparel, latex and vinyl gloves, paint
strainers, and other allied items. These products are often used by homeowners
performing do-it-yourself home improvement projects, contractors and painting
professionals. The Company also sells a line of masking paper products and shop
towels for the automotive aftermarket. The Company has increased sales of
consumer disposables by continually broadening and improving its product line,
thereby allowing customers to consolidate their orders with a single vendor. In
addition, the Company has attracted large buying groups through various volume
incentives.

Away From Home Market Sector

         Until June of 1999, the Company produced and distributed its own line
of tissues, towels and wipes for use in public washrooms. Additionally, the
Company provided converting services for large manufacturers in the
Away-From-Home (AFH) market place. In fiscal 1999, Company management chose to
exit the AFH market due to intense price competition and due to the lack of
strategic emphasis which management placed on that market. On June 28, 1999, the
Company sold all of the fixed assets and inventory related to the AFH product
line to a company located in Green Bay, Wisconsin.

MANUFACTURING AND OPERATIONS

         In producing and distributing its line of Business Imaging Products,
the Company works closely with various Original Equipment Manufacturers (OEMs)
to develop products which meet or exceed the requirements of the imaging
equipment. The Company then produces and stocks a full line of paper products to
meet the needs of the users of the imaging equipment. With regard to its
Contract Manufacturing operations, the Company either utilizes product
specifications provided by its customers or teams with its customers to develop
specifications which meet customer requirements. Generally, the product begins
with a flexible substrate, which is a base material such as a non-woven
material, paper, or polyethylene. The Company applies one or more of its custom
converting or specialty printing services that it has developed over a period of
years through its distinctive technical knowledge to add value to these
materials.

         The Company's growth has been supported by its substantial capital
investment in new facilities and machinery and equipment. During the past three
years, the Company spent over $12 million on capital expenditures at its five
locations. Through the Company's expenditures on new equipment, it has increased
both its manufacturing capacity and the range of its capabilities. Principle
capital additions include equipment which expand the Company's custom folding
and packaging capabilities, and presses which enable the Company to print
poly-laminate and thermal coated substrates. The Company has also expanded and
modernized its roll-to-roll winding capacity. The Company believes it has
sufficient capacity to meet its growth expectations.

         The Company's equipment can produce a wide range of sizes of production
output to meet unique customer specifications. The custom converting equipment
can accommodate web widths from 3 inches to 132 inches. Its folding equipment
can fold from 6 inches to 120 inches by 240 inches, in one-inch increments. The
Company's printing presses perform flexographic and letterpress processes and
print from one to eight colors on webs as wide as 82 inches. Its fine printing
paper and paperboard converting equipment includes state-of-the-art rewinders,
sheeters, folders, perforators, and equipment that performs extensive packaging
functions.

SALES AND MARKETING

         Tufco markets its products and services nationally through its 30
full-time sales and service employees and 114 manufacturer's representatives and
distributors. The Company's sales and service personnel are compensated on a
base salary plus incentive bonus. The Company generally utilizes referrals and
its industry reputation and presence to attract customers, and advertises on a
limited basis in industry periodicals and through cooperative advertising
arrangements with its suppliers and customers.

         Prior to fiscal 1999, customers generally purchased the Company's goods
and services under project-specific purchase orders rather than long-term
contracts; however, beginning in fiscal 1998, management shifted its strategic


                                       3
<PAGE>   5

Sales and Marketing - continued

focus in Contract Manufacturing away from overflow converting towards
longer-term cooperative manufacturing projects which usually include a
multi-year contract. The Company reached agreements with several companies
including Procter & Gamble Manufacturing, Amoco Fabrics and Fibers, and Amscan,
Inc. for specialized contract converting services focused on printing, coating,
cutting, folding, and packing. The Company's sales volume by quarter is subject
to a limited amount of seasonal fluctuation. Generally, Tufco's sales volume and
operating income are at their lowest levels in the first and second fiscal
quarters and are generally higher in the third and fourth fiscal quarters,
however, seasonal fluctuations are diminishing as the Company shifts its
emphasis to longer-term manufacturing agreements.

         The customer base consists of approximately 1,000 companies, including
large consumer products companies, dealers and distributors of business imaging
papers, and resellers of paint sundry products. In fiscal 2000, two customers,
both Fortune 500 companies accounted for more than 10% of consolidated sales
each. A Paint Sundry customer accounted for 12%, and a Contract Manufacturing
customer accounted for 20% of fiscal 2000 net sales. Sales are generally made on
a credit basis within limits set by the Company's executive management. The
Company generally requires payment to be made within 30 days following shipment
of goods.

COMPETITION

         The Company believes the primary areas of competition for its goods and
services are quality, production capacity and capability, capacity for prompt
and consistent delivery, service, continuing relationships and price. The
Company believes that its key competitive advantages are product quality, quick
response, rapid equipment set-up and turnaround time, long-standing customer
relationships, broad customer base, highly engineered machinery and processes,
production diversity and capacity, continuity of management, and experienced
personnel. Management believes that there is no single competitor that offers
the breadth and variety of products and services offered by the Company. In
addition, customers benefit from the Company's ability to perform its multiple
services and distribute from its national asset base, which reduces freight
costs and increases product and service reliability through use of single source
supplier on a national basis.

         Competitors for the Company's products and services vary based upon the
products and services offered. In the Company's Contract Manufacturing services,
the Company believes that relatively few competitors offer a wider range of
services or can provide them from a single source. With respect to the Company's
specialty printing services and fine paper converting products, the competition
consists primarily of numerous small regional companies. Management believes
that the Company's capabilities in Contract Manufacturing and specialty printing
give it the flexibility, diversity, and capacity to compete effectively on a
national basis with large companies and locally with smaller regional companies.
The Company does not believe foreign competition is significant at this time in
the Contract Manufacturing and specialty printing lines. In Business Imaging
Products, raw materials are inexpensive and readily available, and converting
equipment is easily purchased. As a result, competition for Business Imaging
customers is very strong, primarily from small regional suppliers and a few
large national companies. Based on management's assessment of the market, no
single firm offers the breadth of products offered by Tufco on a national basis.
There is strong domestic competition and a modest amount of foreign competition
in the manufacturing and Paint Sundry products.

         Historically, the Company has been subject to surges and declines in
sales due to the short term nature of its converting projects with large
integrated paper products companies. Since the Company began emphasizing longer
term contractual arrangements, management believes that it is now better able to
forecast declines in sales. However, volume requirements in Contract
Manufacturing arrangements are ultimately controlled by the Company's customers,
and a certain amount of short-term fluctuation is expected.

PRODUCT DEVELOPMENT AND QUALITY CONTROL

         The Company works with its customers to develop new products and
applications. The Company believes that a key factor in its success has been its
willingness and distinctive technical competency to help customers experiment
with various flexible substrates to develop materials with different attributes
such as strength, flexibility, absorbency, breathability, moisture-resistance,
and appearance. As a result, the Company's capabilities enable it to develop
certain laminated substrates at lower costs than if the customers developed
these products themselves. For example, a customer



                                       4
<PAGE>   6

PRODUCT DEVELOPMENT AND QUALITY CONTROL (CONTINUED)

may request certain physical tests during trial runs that are performed by the
Company's quality control personnel, often with the customer on site. Customers
are charged for machine time use, materials, and operator time in the new
product development process. After completing the development process, the
Company prices a new product or service and designs an ongoing program that
provides information to the customer such as quality checks, inventory reports,
materials data, and production reports.

         The Company maintains multiple quality control laboratories that
constantly monitor its production using statistical process controls (SPC) to
observe and measure quality effectiveness of its production processes, such as
temperature, speed, tension, and pressure. The Company's rigid standards and use
of SPC have allowed it to qualify for the GMP (Good Manufacturing Practices)
designation from several customers, a quality control standard that these
companies require before they will use a company for outsourcing. In addition,
several of the Company's customers perform periodic audits at the Company's
Green Bay and Dallas facilities to ensure that adequate quality control
practices are in place at all times. In fiscal 2000, the Company achieved ISO
2002 certification for its Green Bay facility The Company's Dallas quality
control laboratory is part of a collaborative of 33 laboratories sponsored by a
large original equipment manufacturer that utilizes the Dallas facility for its
production. The collaborative is utilized by that company to help set quality
standards and ensure that its suppliers, like the Dallas facility, have in
places the process reviews and controls necessary to ensure that quality
products are being manufactured consistently.

RAW MATERIALS AND SUPPLIERS

         The Company is not dependent on any particular supplier or group of
affiliated suppliers for raw materials or for equipment needs. The Company
believes it has excellent relationships with its primary suppliers, and the
Company has not experienced difficulties in obtaining raw materials in the past.
The Company's raw materials fall into four general groups: various paper
stocks, inks for specialty printing, non-woven materials, and polyethylene
films. There are numerous suppliers of all of these materials. To ensure quality
control and consistency of its raw material supply, the Company's Dallas and
Newton facilities receive fine paper stock primarily from three major paper
companies instead of a greater number of companies.


         The Company's primary raw material, base paper, is subject to periodic
price fluctuations. In the past, the Company has been successful in eventually
passing most of the price increases on to its customers, but management cannot
guarantee that the Company will be able to do this in the future.

ENVIRONMENTAL MATTERS

         The Company is subject to federal, state, and local environmental laws
and regulations concerning emissions into the air, discharges into waterways,
and the generation, handling, and disposal of waste materials. These laws and
regulations are constantly evolving, and it is impossible to predict accurately
the effect they may have upon the capital expenditures, earnings, and
competitive position of the Company in the future. The Company believes that it
complies with these laws and regulations in all material respects. The Company
does not maintain environmental impairment insurance.

         The Company's past expenditures relating to environmental compliance
have not had a material effect on the Company, nor does the Company expect that
such expenditures relating to the Company's recently completed addition to its
manufacturing facility will be material. Further growth in the Company's
production capacity with a resultant increase in discharges and emissions may
require capital expenditures for environmental control facilities in the future.
The Company does not expect such expenditures to be material. No assurance can
be given that future changes to environmental laws or their application will not
have a material adverse effect on the Company's business or results of
operations.

EMPLOYEES

         At September 30, 2000, the Company had approximately 675 employees, of
whom 350 were employed at its Green Bay facility, 100 at its Manning facility,
80 at its Dallas facility, 95 at its Newton facility, and 50 at its St. Louis
facility. The Company has a non-union workforce and believes that its
relationship with its employees is good.


                                       5
<PAGE>   7


ITEM 2 - PROPERTIES

         The Company's main production and distribution facilities for Contract
Manufacturing and specialty printing are located in Green Bay, Wisconsin. The
220,000 square foot facility (of which approximately 15,000 square feet are used
for offices) was built in stages from 1980 to 2000 and is owned by the Company.
The Company has approximately seven additional acres on which to expand in the
future.

         The Company leases 44,000 square feet of space in a facility contiguous
to its Green Bay, Wisconsin, facility, which is currently used for certain
Contract Manufacturing, warehousing, and distribution operations. This facility
is leased from a partnership of which Samuel Bero, a director of the Company, is
one of several partners. The lease for this facility expires March, 2003. The
Company has an option to renew this lease for an additional three years.

         The Company's corporate headquarters are located in facilities which it
leases in Dallas, Texas, in the same building in which the Company produces and
distributes Business Imaging products and provides custom converting of various
fine paper and board grade papers. The lease for the 173,000 square foot
facility expires in February, 2003.

         The Company owns a 120,000 square foot facility in Newton, North
Carolina, used in the production and distribution of Business Imaging products
and in the printing of custom forms.

         In June 1996, the Company leased for five years and in October of 1996
occupied a new 62,000 square foot facility in Clarendon County, South Carolina,
which was designed and constructed to house the production and distribution
operations for the Company's Paint Sundry business. The Company has guaranteed
to the lessor that, if the lease is not renewed, the residual market value of
the building which was constructed at a cost of $1.5 million, will be at least
$0.9 million. Management expects the building value will be at least $0.9
million; however, the Company cannot provide assurances as to the impact of
future economic factors influencing the future value of the building. In August
of fiscal 2000, the Company began a 55,000 square foot expansion of the Manning
facility. When complete in February 2001, the Company will close its St. Louis
Paint Sundry facility and consolidate those operations into the expanded Manning
building. The Company also owns a 42,000 square foot facility in Manning, South
Carolina which is not used in operations. In fiscal 1998, the Company decreased
its carrying value of this facility and in fiscal 2000 the Company reached an
agreement to sell this building for a nominal price.

         The Company leases a 60,000 square foot building in St. Louis, Missouri
from the former owners of Foremost Manufacturing Company in which it packages
and distributes paint sundry products. This lease will be vacated as the Manning
consolidation is complete.

         The Company believes that all of its facilities are in good condition
and suited for their present purpose. The Company believes that the property and
equipment currently used and planned for acquisition is sufficient for its
current and anticipated short-term needs, but that the expansion of the
Company's business or the offering of new services could require the Company to
obtain additional equipment or facilities.


ITEM 3 - LEGAL PROCEEDINGS

         The Company is involved in various legal proceedings in the ordinary
course of its business, which are not anticipated to have a material adverse
effect on the Company's results of operations or financial condition.

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

         None.




                                       6
<PAGE>   8



                                     PART II

ITEM 5 - MARKET FOR REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER MATTERS

         Since the Company's initial public offering on January 28, 1994 at
$9.00 per share, the Common Stock of Tufco has been traded on the NASDAQ
National Market under the trading symbol "TFCO." The following table sets forth
the range of high and low closing prices for the Common Stock, as reported on
the NASDAQ National Market for the periods indicated:


<TABLE>
<CAPTION>
                                                        High          Low            Close
                                                        ----          ---            -----
<S>                                                    <C>           <C>            <C>
 Fiscal 1999:
                  Quarter ended December 31, 1998       $ 7.500       $4.125         $ 5.000

                  Quarter ended March 31, 1999          $ 6.375       $3.250         $ 6.000

                  Quarter ended June 30, 1999           $ 8.500       $5.500         $ 8.000

                  Quarter ended September 30, 1999      $ 8.250       $7.000         $ 7.500

Fiscal 2000:
                  Quarter ended December 31, 1999       $10.500       $7.000         $10.375

                  Quarter ended March 31, 2000          $12.000       $8.375         $ 9.500

                  Quarter ended June 30, 2000           $11.250       $8.625         $10.000

                  Quarter ended September 30, 2000      $10.250       $8.750         $10.125
</TABLE>


                  As of December 14, 2000, there were approximately 114 holders
of record of the Common Stock. On December 14, 2000, the last reported sale
price of the Common Stock as reported on the NASDAQ National Market was $7.44
per share.

         The Company has never paid dividends on its Common Stock. All notes
except the Industrial Development Revenue Bonds are supported by loan agreements
which contain certain restrictive covenants, including requirements to maintain
certain levels of cash flow and restriction on the payment of dividends. The
Company does not intend to pay any cash dividends in the foreseeable future.


                                       7
<PAGE>   9


ITEM 6 - SELECTED CONSOLIDATED FINANCIAL DATA (IN THOUSANDS, EXCEPT PER SHARE
DATA)

<TABLE>
<CAPTION>
                                                                               Years Ended September 30,
                                                               -----------------------------------------------------------
                                                                 2000        1999          1998(1)      1997        1996
                                                               --------    --------       --------    --------    --------
<S>                                                            <C>         <C>            <C>         <C>         <C>
STATEMENT OF OPERATIONS DATA:
     Net sales .............................................   $ 78,952    $ 76,331       $ 76,973    $ 65,750    $ 68,374
     Cost of sales .........................................     68,041      63,225         65,903      53,835      56,042
                                                               --------    --------       --------    --------    --------

     Gross profit ..........................................     10,911      13,106         11,070      11,915      12,332
     Selling, general, and
          administrative expenses ..........................      6,564       7,317          7,661       6,396       6,753

     Amortization and other post-acquisition expenses ......      1,150       1,010          1,025         706         724
     Facility closing cost .................................        831          --             --          --          --
     Employee severance cost ...............................        660          --            142          --          --
     Property write-downs ..................................         74          --            250          --          --
     (Gain) loss on asset sales ............................       (327)     (1,048)            37        (101)         (5)
                                                               --------    --------       --------    --------    --------

          Operating income .................................      1,959       5,827          1,955       4,914       4,860
          Interest expense .................................       (974)     (1,086)        (1,177)       (889)     (1,134)
          Interest and other income ........................         35          40             66         266          41
                                                               --------    --------       --------    --------    --------
          Income before income taxes
               and extraordinary item ......................      1,020       4,781            844       4,291       3,767
          Income tax expense ...............................        493       1,803            452       1,638       1,507
                                                               --------    --------       --------    --------    --------

     Income before extraordinary item ......................        527       2,978            392       2,653       2,260
          Extraordinary item-loss from early
               repayment of debt, net of income
               tax benefit of $32...........................         --          --             62          --          --
                                                               --------    --------       --------    --------    --------

          Net income .......................................   $    527    $  2,978       $    330    $  2,653    $  2,260
                                                               ========    ========       ========    ========    ========

          Earnings per share:
               Income before extraordinary item
                    Basic ..................................   $    .12    $    .67       $    .09    $    .61    $    .52
                    Diluted ................................   $    .11    $    .67       $    .09    $    .60    $    .51
               Net income
                    Basic ..................................   $    .12    $    .67       $    .07    $    .61    $    .52
                    Diluted ................................   $    .11    $    .67       $    .07    $    .60    $    .51

          Weighted average common shares outstanding:
                    Basic ..................................      4,499       4,419          4,420       4,384       4,386
                    Diluted ................................      4,622       4,475          4,518       4,448       4,438


OTHER DATA:
     Depreciation and amortization(2) ......................   $  3,535    $  3,090       $  2,605    $  2,363    $  2,279
     Capital expenditures ..................................   $  7,073    $  3,130       $  2,629    $  3,234    $  2,371


BALANCE SHEET DATA: (AT SEPTEMBER 30)
     Working capital .......................................   $ 11,952    $ 13,934       $ 12,630    $ 10,225    $ 10,553
     Total assets ..........................................     62,133      59,081         58,767      49,045      50,038
     Total-current and long-term debt ......................     13,107      14,530         17,697      10,498      13,350
     Stockholders' equity ..................................     36,579      35,246         32,250      31,368      28,719
</TABLE>



                                    FOOTNOTES

(1)      Includes Foremost Manufacturing Company since its acquisition in
         November 1997.

(2)      Includes depreciation and amortization of goodwill and organizational
         expenses.


                                       8
<PAGE>   10

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

FORWARD LOOKING STATEMENTS

         Management's discussion of the Company's 2000 fiscal year in comparison
to fiscal 1999, contains forward-looking statements regarding current
expectations, risks and uncertainties for 2001 and beyond. The actual results
could differ materially from those discussed here. As well as those factors
discussed in the section entitled "Business" in this report, other factors that
could cause or contribute to such differences include, among other items,
significant changes in the cost of base paper stock, competition in the
Company's product areas, or an inability of management to successfully reduce
operating expenses in relation to net sales without damaging the long-term
direction of the Company. Therefore, the selected financial data for the periods
presented may not be indicative of the Company's future financial condition or
results of operations.

GENERAL

         Tufco performs contract manufacturing and specialty printing services,
manufactures and distributes business imaging paper products and paint sundry
products. The Company's strategy is to provide services, manufacture and
distribute products in niche markets relying on close customer contact and high
levels of quality and service. The Company works closely with its contract
manufacturing clients to develop products or perform services which meet or
exceed the customers' quality standards, and to then use the Company's operating
efficiencies and technical expertise to supplement or replace its customers' own
production and distribution functions.

         The Company's technical proficiencies include folding, packaging,
coating, slitting and rewinding, sheeting, multi-color printing and laminating.

         In January 1994, the Company completed an initial public offering of
its stock and concurrently purchased substantially all of the assets of ECC. The
Company issued 900,000 shares of its Common Stock on the NASDAQ Market at $9.00
per share, resulting in net proceeds of $6.8 million. The total cost of the ECC
acquisition was $8.7 million consisting of $7.5 million in cash and 127,778
shares of Common Stock.

         In August 1995, the Company purchased substantially all of the assets
of Hamco for a total cost of $14.2 million funded by the issuance of 1.2 million
shares of Common Stock and additional bank borrowings.

         In November 1997, the Company purchased all of the outstanding common
stock of Foremost Manufacturing Company, Inc. for a total cost of $6.2 million,
including transaction costs, funded by the issuance of 25,907 shares of common
stock and additional bank borrowings.

RESULTS OF OPERATIONS

         The following discussion relates to the financial statements of the
Company for the fiscal year ended September 30, 2000 ("current year" or "fiscal
2000"), in comparison to the fiscal year ended September 30, 1999 ("prior year"
or "fiscal 1999"), as well as the fiscal year ended September 30, 1998 ("fiscal
1998").


                                       9
<PAGE>   11


RESULTS OF OPERATIONS (CONTINUED)

         The following table sets forth, for the years ended September 30 (i)
the percentage relationship of certain items from the Company's statements of
income to net sales and (ii) the year-to-year changes in these items:


<TABLE>
<CAPTION>
                                                           PERCENTAGE OF NET SALES                 YEAR-TO-YEAR CHANGE
                                                ----------------------------------------------     -----------------------------
                                                                                                     1999 TO         1998 TO
                                                    2000             1999             1998             2000            1999
                                                ------------     ------------     ------------     ------------     ------------
<S>                                             <C>             <C>             <C>             <C>            <C>
Net sales ...................................          100.0%           100.0%           100.0%               3%              (1)%
Cost of sales ...............................           86.2             82.8             85.6                8               (4)
                                                ------------     ------------     ------------     ------------     ------------

         Gross margin .......................           13.8             17.2             14.4              (17)              18

Selling and administrative expenses .........            8.3              9.6              9.9              (10)              (4)
Amortization and post-acquisition expenses ..            1.5              1.3              1.4               14               (1)
Facility closing cost .......................            1.0               --               --               --               --
Employee severance cost .....................            0.8               --              0.2               --               --
Property write-downs ........................            0.1               --              0.3               --               --
(Gain) loss on asset sales ..................           (0.4)            (1.4)             0.1              (69)              --
                                                ------------     ------------     ------------     ------------     ------------

         Operating income ...................            2.5              7.6              2.5              (66)             198

Interest expense ............................           (1.2)            (1.4)            (1.5)             (10)              (8)
Interest and other income ...................            0.0              0.0               .1              (13)             (39)
                                                ------------     ------------     ------------     ------------     ------------
         Income before income taxes
            and extraordinary item ..........            1.3              6.3              1.1              (79)             466
Income tax expense ..........................            0.6              2.4              0.6              (73)             299
                                                ------------     ------------     ------------     ------------     ------------

Net income before extraordinary item ........            0.7              3.9              0.5              (82)             660
Extraordinary item ..........................             --               --              0.1               --               --
                                                ------------     ------------     ------------     ------------     ------------

Net income ..................................            0.7%             3.9%             0.4%             (82)%            660%
                                                ============     ============     ============     ============     ============
</TABLE>


         The components of net sales and gross profit are summarized in the
table below:

<TABLE>
<CAPTION>
                                            2000                    1999                    1998
                                      -------------------    -------------------    -------------------
                                                  % of                   % of                   % of
                                       Amount     Total       Amount     Total       Amount     Total
                                      --------   --------    --------   --------    --------   --------
                                                            (Dollars in millions)
<S>                                   <C>        <C>         <C>        <C>         <C>        <C>
         Net Sales

Contract manufacturing and printing   $   34.2         43%   $   26.0         34%   $   19.2         25%
Business imaging paper products           25.9         33        24.9         33        32.5         42
Paint sundry products                     18.8         24        21.0         27        18.0         24
Away-from-home products                    0.0         --         4.4          6         7.3          9
                                      --------   --------    --------   --------    --------   --------

Net sales                             $   78.9        100%   $   76.3        100%   $   77.0        100%
                                      ========   ========    ========   ========    ========   ========
</TABLE>


<TABLE>
<CAPTION>
                                                  Margin                Margin                   Margin
                                       Amount       %         Amount       %         Amount        %
                                      --------   --------    --------   --------    --------   --------
<S>                                   <C>        <C>         <C>        <C>         <C>        <C>
         Gross Profit

Contract manufacturing and printing   $    7.1         21%   $    6.4         25%   $    2.2         11%
Business imaging paper products            2.9         11         3.5         14         5.0         15
Paint sundry products                       .9          5         2.8         13         3.2         18
Away-from-home products                    0.0         --         0.4          9         0.7         10
                                      --------   --------    --------   --------    --------   --------

Gross profit                          $   10.9         14%   $   13.1         17%   $   11.1         14%
                                      ========   ========    ========   ========    ========   ========
</TABLE>


                                       10
<PAGE>   12


FISCAL YEAR ENDED SEPTEMBER 30, 2000 COMPARED TO SEPTEMBER 30, 1999

         NET SALES for fiscal 2000 increased $2.6 million or 3% primarily due to
increased sales of Contract Manufacturing and printing services, which increased
$8.2 million or 32% over the prior year. The increased contract manufacturing
sales were the result of two new service agreements with a Fortune 500 consumer
products company, under which the Company manufactured and packaged a household
cleaning product and a facial wipe. Sales under these two agreements began in
the first quarter of fiscal 2000, and ended abruptly in the second quarter of
fiscal 2000. Based on customer forecasts, Company management had expected sales
under the larger of these two agreements to continue through July of fiscal
2000, and the early termination had a negative impact on gross profit margins in
the Contract Manufacturing sector. In addition to these two agreements, the
Company also began converting paper products for a large manufacturer of
wide-format printers and copiers. Volumes under this agreement are based on
month-to-month purchase orders placed by the customer, and monthly sales can
vary widely. Sales of the Company's Business Imaging paper products increased
$1.0 million (4%) due to a combination of increased selling prices and a smaller
increase in unit volume. Raw material costs increased an average of 19% for the
sector, and the Company passed on a portion of those costs to its customers
resulting in an increase in net sales. However, due to the frequency with which
paper costs increased, and to agreements with customers under which the Company
must provide advance notice of sales price increases, the Company was unable to
pass through all cost increases on a timely basis resulting in diminished gross
profit margins. Sales in the Company's Paint Sundry sector declined $2.2 million
(10%) due primarily to lower sales to a major national paint retailer, as that
customer chose to purchase its products from Asian suppliers beginning in
October of 1999. Finally, no sales of Away-From-Home (AFH) products were
recorded in fiscal 2000, compared to sales of $4.4 million in fiscal 1999. The
Company discontinued marketing AFH products in June of fiscal 1999, and sold the
assets previously used to support that sector. The manufacturing resources
previously used to support production of AFH inventory were reallocated to
support new Contract Manufacturing agreements which were in start-up phase at
the end of fiscal 2000.

         GROSS PROFIT declined $2.2 million (17%) and margins declined to 13.8%
in fiscal 2000 from 17.2% in the prior year. Several factors contributed to the
decline. The most significant decline occurred in the Paint Sundry sector where
gross profit was down $1.9 million and margins declined from 13% in the prior
year to 5% in fiscal 2000. As discussed earlier, the loss of a major customer
contributed heavily to the declining gross profit. In the fourth quarter of
fiscal 2000, management announced its intent to close its St. Louis facility and
consolidate all Paint Sundry operations into the Company's expanded Manning,
South Carolina plant. Management believes that this consolidation will provide
almost $1 million in annual cost savings when completed in March 2001, which
will help to increase gross profit respectively. Gross profit from the sale of
Business Imaging paper products declined $0.6 million (17%) due to the
aforementioned increases in raw material costs which were not entirely passed
through to customers. Management has planned price increases for December 2000
which should result in improved gross profit margins in the final three quarters
of fiscal 2001, assuming raw material cost stability. Finally, gross profit from
Contract Manufacturing services increased $0.7 million, though the gross profit
margin declined from 25% in fiscal 1999 to 21% in fiscal 2000. As noted earlier,
the Company's largest customer cancelled a major manufacturing agreement in the
second quarter of fiscal 2000, approximately five months ahead of the scheduled
termination date. The customer's internal production line was operational
earlier than planned, negating their need for Tufco's services. While the
Company had the right to impose financial penalties for the early termination,
management elected to waive those penalties in recognition of three new
manufacturing agreements which were under negotiation with this customer. The
Company was eventually awarded all three of the new production agreements, and
two of the three will enter commercial production in the second quarter of
fiscal 2001. The sudden decline in sales from the discontinued contract,
combined with the high costs for training and start-up which the Company
incurred for the three new agreements resulted in low gross profit margins in
the third and fourth quarters of fiscal 2000. Margins in the Contract
Manufacturing sector should improve in the second quarter of fiscal 2001 when
these agreements begin commercial operations. Until these agreements are
operational, management projects that gross profit margins will remain lower
than in fiscal 1999.

         SELLING AND ADMINISTRATIVE EXPENSES for fiscal 2000 were down $0.8
million or 10%, principally due to costs eliminated from the discontinuance of
the AFH sales and marketing sector.

         GOODWILL AMORTIZATION AND POST-ACQUISITION EXPENSES increased $0.1
million (14%) due to costs accrued relating to potential liability under an
indemnification agreement to Bradford Venture Partners, Ltd. a related party.



                                       11
<PAGE>   13
FISCAL YEAR ENDED SEPTEMBER 30, 2000 COMPARED TO SEPTEMBER 30, 1999 (CONTINUED)

         FACILITY CLOSING EXPENSE is a one-time charge associated with the
closing of the Company's St. Louis distribution facility and the moving of the
related inventory, equipment and personnel to Manning.

         SEVERANCE EXPENSE was $0.7 million in fiscal 2000, and relates to
payments due to a former executive of the Company pursuant to an employment
agreement with an acquired company.

         GAINS ON ASSET SALES were $0.3 million in fiscal 2000 resulting from
the sale of certain under-utilized printing equipment in the Green Bay facility.
In the prior year, most of the $1.0 million gain was the result of the sale of
assets formerly used to support the AFH business sector.


         NET INTEREST EXPENSE decreased $0.1 million due to lower average
borrowings during the current fiscal year.


         INCOME TAXES were 48% of pre-tax earnings in fiscal 2000, compared to
38% for the prior year. The increased rate was the result of the impact that
certain non-deductible expenses, such as goodwill amortization, on the
relatively low level of pre-tax income.

         BASIC AND DILUTED EARNINGS PER SHARE were 12 cents and 11 cents
respectively in fiscal 2000. Adjusted for the after tax effects of the plant
costing costs and executive severance, basic and diluted earnings per share
would have been 32 cents.

FISCAL YEAR ENDED SEPTEMBER 30, 1999 COMPARED TO SEPTEMBER 30, 1998

         NET SALES for fiscal 1999 decreased $0.6 million, or 1%, in part due to
the discontinuance of the Company's Away From Home (AFH) product line in June of
fiscal 1999. Sales in the Company's remaining market sectors increased 3%. The
Company discontinued its AFH sales efforts because management believed that the
Company's relatively small market share, the lack of a reliable long term source
of base paper and the frequency of heavy price discounting in the market sector
made AFH products a poor fit with the Company's chosen strategic direction.
Instead, management has reallocated plant space and personnel previously
allocated to the AFH sector toward expanding its Contract Manufacturing
services, the Company's primary strategic focus for the future. Sales of
Contract Manufacturing services increased $6.8 million (35%) over the prior
year, primarily due to new agreements to provide contract folding, packaging and
printing services for large consumer products companies. Management identified
Contract Manufacturing as its key growth sector during development of its
strategic plan in fiscal 1998 and began allocating capital and personnel
resources toward growth in that sector. To further its capabilities in the
sector, the Company installed a new eight color flexographic printing press in
its Green Bay facility. The total value of the press exceeded $4 million, for
which the Company entered into a long term operating lease in December 1999.
Management believes that the expanded services made possible by the new press
will enable the Company to further grow its specialty printing services. Sales
in the Company's Business Imaging sector declined $7.6 million (23%) primarily
due to continued deep discounts in the selling price of its engineering and
point-of-sale (POS) roll products as a result of increased competition, as well
as the loss of several large POS national account customers which were at lower
profit margins. Finally, sales of the Company's Paint Sundry products increased
$3.0 million (17%) over the prior year. A portion of the increase ($0.9 million)
results from the timing of the Foremost acquisition for which only eleven months
of sales were recognized in fiscal 1998. Adjusted for this fact, sales in this
sector increased 12%, primarily due to increased sales to large do-it-yourself
home centers.

         GROSS PROFIT increased $2.0 million, or 18%, to $13.1 million in fiscal
1999, and gross profit margins increased to 17% in the current year from 14% in
the prior year. The Company was able to increase gross profit primarily due to
the growth in sales of Contract Manufacturing services, for which the Company is
generally able to earn higher margins due to the high levels of capital
investment, project management skills and technical competence required by
customers in that sector. Strong competition continued to depress gross profit
margins in the Company's Business Imaging sector, as the Company continued to
lower its selling prices in response to market conditions. While management
believes it is effectively retaining its key customer base, profitability is
still depressed and management cannot provide assurance that Business Imaging
selling prices will rebound in the near term. Opportunities exist to provide
contract manufacturing services for several large companies in the Business
Imaging sector, and management is pursuing some of those opportunities. Margins
in the Company's Paint Sundries sector declined during the year due to costs
incurred to consolidate operations and absorb the Foremost acquisition.


                                       12
<PAGE>   14


FISCAL YEAR ENDED SEPTEMBER 30, 1999 COMPARED TO SEPTEMBER 30, 1998 (CONTINUED)

         SELLING AND ADMINISTRATIVE EXPENSES decreased $0.5 million or 6% from
fiscal 1998. The decrease was the result of lower selling expenses resulting
from the elimination of the AFH marketing group as well as reductions in certain
costs which were higher than normal in the prior year, including severance and
health insurance costs.

         GOODWILL AMORTIZATION AND POST-ACQUISITION EXPENSES were relatively
unchanged from the prior year, as the Company did not complete any acquisitions
during the current fiscal year.

         GAINS ON ASSET SALES totaled $1.0 million in fiscal 1999 resulting
primarily from the discontinuance of the AFH business sector and the sale of
production equipment and inventory which were previously dedicated to that
sector. Additionally, the Company sold two other pieces of production equipment
which had limited ongoing production value to the Company.

         NET INTEREST EXPENSE decreased $0.1 million due to lower average
borrowings during the current fiscal year.

         INCOME TAXES were 38% of pretax earnings for fiscal 1999 compared to
54% for the prior year. Fiscal 1998 was an anomaly because the low level of
pre-tax income served to accentuate the effect that non-deductible goodwill
amortization expense had on the overall tax rate. By comparison, income taxes
for fiscal year 1997 were 38% of pre-tax earnings as well.

         BASIC AND DILUTED EARNINGS PER SHARE after the effect of the
extraordinary item were both 67 cents in fiscal 1999 compared to 7 cents in
fiscal 1998. Adjusted for the gains from the sale of equipment and other assets,
basic and diluted earnings per share were both 53 cents per share in fiscal
1999.










                                       13
<PAGE>   15



SELECTED QUARTERLY FINANCIAL DATA

         The following table sets forth selected quarterly financial
information. This information is derived from unaudited consolidated financial
statements of the Company and includes, in the opinion of management, all normal
and recurring adjustments that management considers necessary for a fair
statement of results for such periods. The operating results for any quarter are
not necessarily indicative of results for any future period.


FISCAL 2000 (Dollars in thousands, except per share amounts)

<TABLE>
<CAPTION>
                                                  First       Second       Third        Fourth
                                                 Quarter      Quarter     Quarter      Quarter
<S>                                             <C>          <C>          <C>          <C>
Net sales ...................................   $   20,701   $   19,783   $   19,392   $   19,076
Gross profit ................................        3,654        3,417        2,038        1,802
Operating expenses ..........................        1,822        2,082        1,545        3,503
Operating income (loss) .....................        1,832        1,335          493       (1,701)
Income (loss) before income taxes ...........        1,550        1,075          237       (1,842)
Income tax expense (benefit) ................          574          398          151         (630)
Net income (loss) ...........................          976          677           86       (1,212)
Earnings (loss) per share:
         Basic ..............................          .22          .15          .02         (.26)
         Diluted ............................          .21          .15          .02         (.26)
</TABLE>


FISCAL 1999 (Dollars in thousands, except per share amounts)

<TABLE>
<CAPTION>
                                                 First     Second      Third     Fourth
                                                Quarter    Quarter    Quarter    Quarter
<S>                                             <C>        <C>        <C>        <C>
Net sales ...................................   $ 18,341   $ 18,519   $ 19,416   $ 20,055
Gross profit ................................      2,974      2,801      3,493      3,838
Operating expenses ..........................      1,940      1,988      1,250      2,101
Operating income ............................      1,034        813      2,243      1,737
Income before income taxes ..................        781        516      1,960      1,524
Income tax expense (benefit) ................        312        181        714        596
Net income ..................................        469        335      1,246        928
Earnings per share:
         Basic ..............................        .11        .08        .28        .21
         Diluted ............................        .11        .08        .28        .21
</TABLE>


         As noted in the fiscal 2000 full-year sales and gross profit
discussion, the Company's largest customer cancelled a major Contract
Manufacturing agreement 5 months ahead of its scheduled termination. This
cancellation, combined with high start-up costs incurred for three new
production agreements, resulted in lower sales and gross profit in the third and
fourth quarters of fiscal 2000. Additionally, the company accrued approximately
$1.5 million in total costs for executive severance and the closing of the St.
Louis distribution operation. These costs are reflected in the operating
expenses in the fourth quarter of fiscal 2000.

         In the first and third quarters of fiscal 1999, the Company sold
equipment resulting in pre-tax gains of $0.3 million (per share: $0.05 basic and
diluted) and $0.7 million (per share: $0.09 basic and diluted) respectively.
These gains are reflected in the operating expenses.


LIQUIDITY AND CAPITAL RESOURCES

         Cash flow from operations increased $4.9 million to $6.9 million in
fiscal 2000. Cash generated from net income adjusted for non-cash expenses and
gains was $4.0 million compared to $5.7 million in the prior year. Offsetting
this decline, accounts receivable grew at a slower rate than in the prior year
due to more timely payments



                                       14
<PAGE>   16


LIQUIDITY AND CAPITAL RESOURCES (CONTINUED)

from the Company's largest customer, resulting in a $2.2 million improvement in
cash flow. Additionally, accounts payable increased $3.2 million due to payments
due on customer owned equipment associated with the new production agreements,
which were in start-up phase, and to the timing of payment due dates relative to
the last day of the fiscal year. The Company has an arrangement with its largest
customer whereby the Company purchases and installs the customer's production
equipment, and is later reimbursed by the customer, and the balance of these
payments due on the last day of fiscal 2000 was $1.0 million.

         Cash used in investing activities totaled $6.1 million in fiscal 2000
resulting from costs incurred to expand the Company's Green Bay production
facility and to purchase and install production equipment. These expenditures
were partially offset by proceeds from the sale of under-utilized production
equipment.

         Cash used in financing activities totaled $0.6 million resulting from
the repayment of long-term debt offset by cash received from the exercise of
stock options.

         The Company's primary need for capital resources is to finance
inventories, accounts receivable, capital expenditures, and acquisitions. On
August 28, 1998, the Company entered into a syndicated financing arrangement
with First Union National Bank (First Union) and Chase Bank of Texas, N.A. with
First Union acting as agent. Under the agreement, as amended in fiscal 2000, the
Company has $ 5.1 million of term debt at September 30, 2000, repayable in equal
quarterly payments maturing in August 2005 and up to $12.0 million under a
revolving credit agreement through June 2002. In fiscal 1998, the Company paid
approximately $0.1 million to its former lender to exit the prior credit
agreement, principally in the form of prepayment penalties on the early
repayment of term debt. Simultaneous with the refinancing, the Company entered
into an interest rate swap arrangement with First Union which had the effect of
creating a fixed rate of interest on the Company's term debt. As a result of
this arrangement, the rate of interest on the term debt is fixed at 5.87%, plus
a profit spread for the syndicated banks of between 100 and 150 basis points,
depending on certain financial ratios achieved by the Company. Management
believes that this hedge arrangement creates a desirable stability of future
interest payments. At December 12, 2000, the Company had approximately $12.1
million in total borrowings outstanding under this agreement, with $4.7 million
available under the revolving credit agreement. Management believes its
operating cash flow is adequate to service its long-term obligations as of
September 30, 2000, and any budgeted capital expenditures.

         The credit facility is secured by substantially all of the Company's
assets and contains certain restrictive covenants, including minimum required
net worth, minimum required cash flow, maximum allowable indebtedness and
maximum allowable capital expenditures. At September 30, 2000, the Company was
in compliance with all of its debt covenants. The Company had previously
obtained a waiver from the banks permitting it to sell various production assets
during fiscal 1999.

         During the first quarter of fiscal 2000, the Company entered into a
lease to own and operate a Windmoeller and Hoelscher eight color flexographic
printing press. The lease is structured as an operating lease over ten years
with payments totaling approximately $0.5 million annually. The Company will
have the right to purchase the asset at varying points during the lease.

         The Company intends to retain earnings to finance future operations and
expansion and does not expect to pay any dividends within the foreseeable
future. In addition, the Company's primary lender must approve the payment of
any dividends.

         The Company's allowance for uncollectible accounts receivable was $0.6
million at December 12, 2000. Management believes that this allowance is
adequate to provide for losses inherent in its accounts receivable.

         Sharp increases or decreases in the costs of key commodities, such as
paper or polyethylene, periodically impact the Company's inventory values and
net income. This was the case in fiscal 2000 as rising paper costs had a
negative impact on the Company's profit. In fiscal years 1998 and 1999, the
impact of inflation was minimal on the Company's inventory and net income. The
Company is generally successful in eventually passing these fluctuations in raw
material prices to its customers through increases or decreases in the selling
price of the Company's products, although the timing of selling price increases
may lag behind cost increases. Prior to these periods, the impact of inflation
has been minimal on the Company's inventory and net income.



                                       15
<PAGE>   17


RECENTLY ISSUED ACCOUNTING STANDARDS

         SFAS 133, "Accounting for Derivative Instruments and Hedging
Activities" will be effective for the Company's year beginning October 1, 2000;
this Statement establishes standards for the valuation, classification and
accounting of derivative instruments. The Company expects that the
implementation of these standards will have no material effect on the financial
statements.

ITEM 7A - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

         Interest Rate Risk - The Company has entered into an interest rate swap
contract as a hedge under which the interest rate on its term debt is fixed at
5.87%, plus a profit spread for the lender of between 100 and 150 basis points,
depending on certain financial ratios achieved by the Company (see Note 7 to the
Company's Financial Statements). At September 30, 2000, prevailing market
interest rates were higher than the fixed rate in the Company's swap agreement,
and the Company would have received a premium of $61,000 from its lender if the
debt under the swap were to have been paid in full at that time. Prior to
entering into the swap agreement, management had reviewed the 40-year history of
interest rates and had determined, and still believes, that the Company's risk
of potential future liability resulting from a material decline in interest
rates below the fixed level under the swap was not significant.

         Foreign Currency Exchange Risk - The Company had no transactions in
foreign currencies, nor had it entered into any foreign currency futures
contracts as of September 30, 2000.

         Commodity Price Risk - The Company had not entered into any forward
buying agreements for the raw materials it uses to produce its goods and
services as of September 30, 2000. The Company presents its assessment of the
risks of short-term commodity price fluctuations in the section entitled Raw
materials and Supplies under Part I, Item 1 of this document.

         Other Relevant Market Risks - The Company does not own any marketable
securities, and management has not identified any other relevant market risks.

ITEM 8 - FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

         Financial statements are attached as Appendix to this report.

ITEM 9 - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

         Not applicable.



                                       16
<PAGE>   18


                                   PART III

ITEM 10 - DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

         The executive officers, directors, and key employees of the Company
are:

<TABLE>
<CAPTION>
Name                              Age     Positions With the Company
----                              ---     --------------------------
<S>                               <C>     <C>
Louis LeCalsey, III               61      President and Chief Executive Officer
Gregory L. Wilemon                40      Chief Financial Officer, Chief Operating
                                          Officer and Secretary/Treasurer
Robert J. Simon(1)(2)(3)          42      Chairman of the Board of Directors
Samuel J. Bero(1)(3)              65      Director
C. Hamilton Davison, Jr.(3)       41      Director
William J. Malooly(2)             58      Director
Seymour S. Preston III(2)         67      Director
</TABLE>


----------
(1) Member of the Executive Committee
(2) Member of the Audit Committee
(3) Member of the Compensation Committee


         Each director holds office until the next annual meeting of
stockholders of the Company and until his successor has been elected and
qualified. Each director with the exception of Mr. Bero and Mr. LeCalsey has
served on the Board of Directors since Tufco's inception in February 1992. Mr.
Bero was elected to the Board in 1994 and Mr. LeCalsey was elected in 1996.
Executive officers of the Company are elected by the Board of Directors and
serve at the discretion of the Board. There are no family relationships between
any executive officers or directors of the Company.

EXECUTIVE OFFICERS, DIRECTORS, AND KEY EMPLOYEES

         Louis LeCalsey, III -- Mr. LeCalsey assumed the positions of President
and Chief Executive Officer of Tufco in September 1996. Previously he was
President of Tufco Industries, Inc. since April 1996 and prior to that he served
as Vice President of Worldwide Logistics for Scott Paper Company, the
culmination of a 23-year career with Scott in various leadership positions. Mr.
LeCalsey serves as a director for TriMark, Inc., as well as a member of the
Advisory group for Bradford Equities Fund LLC.

         Gregory L. Wilemon -- Mr. Wilemon has been Chief Financial Officer
since September 18, 1995 and was appointed Secretary/Treasurer by the board
effective November 12, 1995 and Chief Operating Officer in September 1996. Mr.
Wilemon had been Chief Operating Officer at Executive Roll Manufacturing from
1991 until May of 1993. From 1993 until he rejoined the Company, Mr. Wilemon was
Vice President of Finance at Great North American Companies. Prior to his
earlier tenure with the Company, Mr. Wilemon was a Senior Business Planner with
PepsiCo from 1987 to 1991.

         Robert J. Simon -- Mr. Simon has been Chairman of the Board of
Directors of Tufco since February 1992. Mr. Simon has been a Senior Managing
Director of Bradford Ventures, Ltd., a private investment firm, since 1992 and a
General Partner of Bradford Associates since 1989, having started at the firm in
1984. Mr. Simon is Chairman of the Board of Foilmark, Inc., a public company.
Mr. Simon is either Chairman of the Board or a director of Ampco Metal Inc.,
Parmarco Technologies, Inc., TriMark, Inc., Mexican Accent, Inc., Overseas
Equity Investors Ltd., Overseas Private Investors Ltd., and Overseas Callander
Fund, Ltd. and several other privately held companies.

         Samuel J. Bero -- Mr. Bero had been President and Chief Executive
Officer from November 1993 until he retired in July 1995, Executive Vice
President since November 1992, and General Manager of Tufco since 1974, when he
co-founded the Predecessor. Mr. Bero has over 33 years of experience in the
converting industry.



                                       17
<PAGE>   19



EXECUTIVE OFFICERS, DIRECTORS, AND KEY EMPLOYEES (CONTINUED)

         C. Hamilton Davison, Jr. -- Mr. Davison has been the President and a
director of Paramount Cards, Inc., a manufacturer and retailer of greeting
cards, since 1988 and Chief Executive Officer since 1995. Prior to that time,
Mr. Davison was Vice President, International and Marketing of Paramount Cards,
Inc. Mr. Davison is also a director and former president of the greeting card
industry trade association. In addition to other private companies and
not-for-profit boards, he served as a director and member of the audit committee
of Valley Resources (AMEX:VR) until 2000 when the company was sold to Southern
Union (NYSE:SUG). Mr. Davison received a Bachelors Degree from Vanderbilt
University and a masters degree from the University of Texas.

         William J. Malooly -- Mr. Malooly has been the Chairman and Chief
Executive Officer of Bank One, Green Bay since 1977. Mr. Malooly retired from
Bank One in September 1999 and is currently engaged in consulting and investing.

         Seymour S. Preston, III -- Mr. Preston is the Chairman and Chief
Executive Officer of AAC Engineered Systems, Inc. a manufacturer of deburring
and metal finishing equipment. From 1990 to 1993, Mr. Preston was President and
Chief Executive Officer of Elf Atochem North America, Inc., a manufacturer and
marketer of plastics and specialty chemicals. Prior to 1990, Mr. Preston was
President, Chief Operating Officer and Director of Pennwalt Corporation. Mr.
Preston is currently is a Director of Albemarle Corporation, Scott Specialty
Gases, Inc., The Barra Foundation, and is the Interim President of the Academy
of Natural Sciences of Philadelphia. Mr. Preston received a BA in chemistry from
Williams College and an MBA from the Harvard Business School.

COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT

The information called for by Item 10 with respect to compliance with Section
16(a) of the Securities Exchange Act is incorporated by reference from the Proxy
Statement relating to the Company's annual meeting to be held in 1999 (the
"Proxy Statement"), which Proxy Statement is to be filed with the Securities and
Exchange Commission pursuant to Regulation 14A within 120 days of the end of the
fiscal year covered by this report.

ITEM 11 - EXECUTIVE COMPENSATION

         The information called for by Item 11 is incorporated by reference from
the Proxy Statement.

ITEM 12 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         The information called for by Item 12 is incorporated by reference from
the Proxy Statement.

ITEM 13 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         The information called for by Item 13 is incorporated by reference from
the Proxy Statement.




                                       18
<PAGE>   20


                                     PART IV

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

(a) 1. Financial Statements. Financial statements are attached as an Appendix to
       this report. The index to the financial statements is found on F-1 of the
       Appendix.

(a) 2. Financial Statement Schedules. All schedules are omitted since the
       required information is not present or is not present in amounts
       sufficient to require a submission of the schedules, or because the
       information required is included in the financial statements and notes
       thereto.

(a) 3. Exhibits. See Exhibit Index in part (c), below.

(b)    The Company did not file any reports on Form 8-K during the quarter ended
       September 30, 2000.

(c)    Exhibit
       Number                      Description
       ------                      -----------

       2.1                  Stock Purchase Agreement dated as of November 12,
                            1997 by and among Tufco Technologies, Inc. (the
                            "Company"), Charles Cobaugh and James Barnes (filed
                            as exhibit 2.1 to the Company's Form 8-K dated
                            November 13, 1997 filed with the Commission on
                            November 26, 1997 file number 0-21018, incorporated
                            by reference herein).

       3.1                  Restated Certificate of Incorporation(1) (Exhibit
                            3.1)

       3.2                  Bylaws(1) (Exhibit 3.2)

       10.1                 Stock Purchase and Contribution Agreement, dated as
                            of February 25, 1992, among the Company, Tufco
                            Industries, Inc. ("Tufco"), and the Stockholders of
                            Tufco.(1) (Exhibit 10.1)

       10.2                 Amended and Restated Consulting Agreement with
                            Bradford Investment Partners, L.P.(3) (Exhibit 10)

       10.3                 Loan Agreement, dated May 1, 1992, between the
                            Village of Ashwaubenon, Wisconsin, and the
                            Company.(1) (Exhibit 10.11)

       10.4                 1992 Non-Qualified Stock Option Plan(1) (Exhibit
                            10.12)

       10.5                 Form of Employee Stock Purchase Agreement between
                            the Company and certain key employees of the
                            Company.(1) (Exhibit 10.17)

       10.6                 1993 Non-Employee Director Stock Option Plan.(2)
                            (Exhibit 10.19)

       10.7                 Amended Employment Agreement with Greg Wilemon,
                            dated September 18, 1995.(4) (Exhibit 10.11)

       10.8                 Lease Agreement, dated as of March 1, 1995, between
                            Bero, Garland, Gebhardt and McClure, a Wisconsin
                            partnership, and Tufco.(4) (Exhibit 10.13)

       10.9                 Lease Agreement dated as of April 1, 1996, between
                            Bero, Garland, Gebhardt and McClure, a Wisconsin
                            partnership, and Tufco.(5) (Exhibit 10.15)

       10.10                Employment Agreement with Louis LeCalsey, III dated
                            September 19, 1996.(5) (Exhibit 10.18)

       10.11                Credit Agreement among Tufco L.P. as Borrower, the
                            Company as the Parent First Union National Bank as
                            agent and the banks named herein dated August 28,
                            1998.(6)

       10.12                ISDA Master Agreement and Schedule to the Master
                            Agreement dated as of July 30, 1998 between First
                            Union National Bank and Tufco, L.P.(6)

       10.13                First Amendment to Credit Agreement.(6)

       10.14                Second Amendment to Credit Agreement.(7)

       21.1                 Subsidiaries of the Company.(6)

       27.1*                Financial Data Schedule

       99.1*                Employee Stock Purchase Agreement executed by Greg
                            Wilemon in favor of the Company dated September 30,
                            2000. (Exhibit 99.1)


       *      Filed herewith

       (1)    Incorporated by reference to the Company's Registration Statement
              on Form S-1 (Reg. No. 33-55828) (the "Registration Statement") as
              filed with the Commission on December 16, 1992.

       (2)    Incorporated by reference to Amendment No. 1 to the Registration
              Statement as filed with the Commission on November 23, 1993.

       (3)    Incorporated by reference to the Company's Quarterly Report on
              Form 10-Q for the quarterly period ended March 31, 1995.




                                       19
<PAGE>   21


       (4)    Incorporated by reference to the Company's Annual Report on Form
              10-K for the period ended September 30, 1995.

       (5)    Incorporated by reference to the Company's Annual Report on Form
              10-K for the period ended September 30, 1997.

       (6)    Incorporated by reference to the Company's Annual Report on Form
              10-K for the period ended September 30, 1998.

       (7)    Incorporated by reference to the Company's Annual Report of Form
              10-Q for the period ended June 30, 2000.

(c)    See (a)(3) above for the list of exhibits required to be filed as part
       of the Annual Report on Form 10-K.






                                       20
<PAGE>   22



                                   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, in Green Bay,
Wisconsin, on December 15, 2000.

                            Tufco Technologies, Inc.



                            By:  /s/ Louis LeCalsey, III
                                 -------------------------------------
                                 Louis LeCalsey, III
                                 President and Chief Executive Officer


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


<TABLE>
<CAPTION>
             Signature                                Title                          Date
             ---------                                -----                          ----
<S>                                     <C>                                     <C>

/s/ Louis LeCalsey, III                  President, Chief Executive Officer     December 15, 2000
------------------------------------     and Director (Principal Executive
Louis LeCalsey, III                      Officer)

/s/ Robert J. Simon                      Chairman of the Board                  December 15, 2000
------------------------------------
Robert J. Simon


/s/ Gregory L. Wilemon                   Chief Financial Officer, Chief         December 15, 2000
------------------------------------     Operating Officer and Secretary
Gregory L. Wilemon                       (Principal Financial and
                                         Accounting Officer)

/s/ Samuel J. Bero                       Director                               December 15, 2000
------------------------------------
Samuel J. Bero


/s/ C. Hamilton Davison Jr.              Director                               December 15, 2000
------------------------------------
C. Hamilton Davison, Jr.


/s/ William J. Malooly                   Director                               December 15, 2000
------------------------------------
William J. Malooly


/s/ Seymour S. Preston, III              Director                               December 15, 2000
------------------------------------
Seymour S. Preston, III
</TABLE>



<PAGE>   23


TUFCO TECHNOLOGIES, INC. AND SUBSIDIARIES

INDEX TO FINANCIAL STATEMENTS - ITEM 8 OF FORM 10-K
--------------------------------------------------------------------------------


<TABLE>
<CAPTION>
                                                                                                                      PAGE
<S>                                                                                                                  <C>
INDEPENDENT AUDITORS' REPORT..........................................................................................F-2

FINANCIAL STATEMENTS AND NOTES:

   Consolidated Balance Sheets as of September 30, 2000 and 1999......................................................F-3

   Consolidated Statements of Income
      for the Years Ended September 30, 2000, 1999 and 1998...........................................................F-4

   Consolidated Statements of Stockholders' Equity
      for the Years Ended September 30, 2000, 1999 and 1998...........................................................F-5

   Consolidated Statements of Cash Flows
      for the Years Ended September 30, 2000, 1999 and 1998...........................................................F-6

   Notes to Consolidated Financial Statements.........................................................................F-7
</TABLE>



                                      F-1
<PAGE>   24


INDEPENDENT AUDITORS' REPORT


To the Directors and Stockholders of
   Tufco Technologies, Inc.:

We have audited the accompanying consolidated balance sheets of Tufco
Technologies, Inc. and subsidiaries (the "Company") as of September 30, 2000 and
1999, and the related consolidated statements of income, stockholders' equity
and cash flows for each of the three years in the period ended September 30,
2000. 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 auditing standards generally accepted
in the United States of America. 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 Tufco Technologies, Inc. and
subsidiaries at September 30, 2000 and 1999, and the results of their operations
and their cash flows for each of the three years in the period ended September
30, 2000, in conformity with accounting principles generally accepted in the
United States of America.



/s/ DELOITTE & TOUCHE LLP
Dallas, Texas
December 1, 2000


                                      F-2
<PAGE>   25


TUFCO TECHNOLOGIES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS
SEPTEMBER 30, 2000 AND 1999
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
ASSETS
                                                                            2000            1999
<S>                                                                    <C>             <C>
CURRENT ASSETS (Note 7):
   Cash and cash equivalents                                           $    930,388    $    692,002
   Restricted cash (Note 9)                                                  31,717          20,050
   Accounts receivable - net (Note 3)                                    12,697,187      12,721,698
   Inventories (Note 4)                                                   7,912,482       8,248,876
   Prepaid expenses and other current assets                                740,383         763,972
   Income taxes receivable                                                  560,444
   Deferred income taxes (Note 8)                                           796,174         447,096
                                                                       ------------    ------------

           Total current assets                                          23,668,775      22,893,694

PROPERTY, PLANT AND EQUIPMENT - Net (Notes 5 and 7)                      20,182,838      16,636,756

GOODWILL - Net (Notes 1 and 2)                                           17,341,724      17,948,930

OTHER ASSETS - Net (Note 6)                                                 939,811       1,601,409
                                                                       ------------    ------------

TOTAL                                                                  $ 62,133,148    $ 59,080,789
                                                                       ============    ============

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
   Current portion of long-term debt (Note 7)                          $  1,771,432    $  1,902,435
   Accounts payable                                                       6,964,711       3,764,026
   Accrued payroll, vacation and payroll taxes                            1,544,867       1,537,041
   Other current liabilities                                              1,435,450       1,580,744
   Income taxes payable                                                                     175,001
                                                                       ------------    ------------

           Total current liabilities                                     11,716,460       8,959,247

LONG-TERM DEBT - Less current portion (Note 7)                           11,335,704      12,627,136

DEFERRED INCOME TAXES (Note 8)                                            2,502,223       2,248,871

COMMITMENTS AND CONTINGENCIES (Note 9)

STOCKHOLDERS' EQUITY (Note 11):
   Voting common stock; $.01 par value; 9,000,000 shares authorized;
      4,675,019 and 4,498,618 shares issued, respectively                    46,750          44,986
   Additional paid-in capital                                            24,879,246      23,973,017
   Retained earnings (Note 7)                                            12,383,489      11,856,772
   Treasury stock at cost, 78,497 voting common shares                     (534,045)       (534,045)
   Stockholder notes receivable                                            (196,679)        (95,195)
                                                                       ------------    ------------

             Total stockholders' equity                                  36,578,761      35,245,535
                                                                       ------------    ------------

TOTAL                                                                  $ 62,133,148    $ 59,080,789
                                                                       ============    ============
</TABLE>


See notes to consolidated financial statements.


                                      F-3
<PAGE>   26


TUFCO TECHNOLOGIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME
YEARS ENDED SEPTEMBER 30, 2000, 1999 AND 1998
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                             2000            1999            1998

<S>                                                  <C>             <C>             <C>
NET SALES                                            $ 78,952,268    $ 76,330,563    $ 76,972,776

COST OF SALES                                          68,041,438      63,224,285      65,902,280
                                                     ------------    ------------    ------------
GROSS PROFIT                                           10,910,830      13,106,278      11,070,496

OPERATING EXPENSES:
   Selling, general and administrative (Note 10)        6,564,378       7,317,325       7,661,463
   Amortization and other postacquisition expenses      1,149,697       1,009,868       1,024,620
   Facility closing costs (Note 14)                       831,305
   Employee severance costs                               659,950                         142,030
   Property write-downs                                    74,000                         250,000
   (Gain) loss on asset sales (Note 5)                   (327,331)     (1,047,591)         36,925
                                                     ------------    ------------    ------------

           Total                                        8,951,999       7,279,602       9,115,038
                                                     ------------    ------------    ------------

OPERATING INCOME                                        1,958,831       5,826,676       1,955,458

OTHER INCOME (EXPENSE):
   Interest expense                                      (973,583)     (1,085,511)     (1,176,623)
   Interest and other income                               34,894          39,370          65,096
                                                     ------------    ------------    ------------

           Total                                         (938,689)     (1,046,141)     (1,111,527)
                                                     ------------    ------------    ------------

INCOME BEFORE INCOME TAXES
   AND EXTRAORDINARY ITEM                               1,020,142       4,780,535         843,931

INCOME TAX EXPENSE (Note 8)                               493,425       1,802,216         451,790
                                                     ------------    ------------    ------------

INCOME BEFORE EXTRAORDINARY ITEM                          526,717       2,978,319         392,141

EXTRAORDINARY ITEM - Loss from early
   repayment of debt, net of income tax
   benefit of $32,059 (Note 7)                                                             62,231
                                                     ------------    ------------    ------------

NET INCOME                                           $    526,717    $  2,978,319    $    329,910
                                                     ============    ============    ============

EARNINGS PER SHARE:
   Income before extraordinary item:
      Basic                                          $        .12    $        .67    $        .09
                                                     ============    ============    ============

      Diluted                                        $        .11    $        .67    $        .09
                                                     ============    ============    ============

   Net income:
      Basic                                          $        .12    $        .67    $        .07
                                                     ============    ============    ============

      Diluted                                        $        .11    $        .67    $        .07
                                                     ============    ============    ============

WEIGHTED AVERAGE COMMON
   SHARES OUTSTANDING:
   Basic                                                4,499,391       4,418,859       4,419,763
                                                     ============    ============    ============

   Diluted                                              4,622,318       4,474,802       4,517,849
                                                     ============    ============    ============
</TABLE>


See notes to consolidated financial statements.



                                      F-4
<PAGE>   27


TUFCO TECHNOLOGIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
YEARS ENDED SEPTEMBER 30, 2000, 1999 AND 1998
--------------------------------------------------------------------------------


<TABLE>
<CAPTION>
                                                                                   COMMON STOCK
                                                            --------------------------------------------------------
                                                                      VOTING                       NONVOTING             ADDITIONAL
                                                            --------------------------    --------------------------      PAID-IN
                                                                SHARES        AMOUNT           SHARES       AMOUNT        CAPITAL
<S>                                                         <C>          <C>                <C>        <C>            <C>
BALANCES AT OCTOBER 1, 1997                                   3,733,830    $    37,338        709,870    $     7,099    $23,539,420

   Exercise of employee stock options                            26,486            265                                      172,140

   Issuance of common stock - Foremost acquisition (Note 2)      25,907            259                                      249,741

   Repayment of stockholder notes receivable

   Purchase of treasury stock, 18,693 shares

   Net income
                                                            -----------    -----------    -----------    -----------    -----------

BALANCES AT SEPTEMBER 30, 1998                                3,786,223         37,862        709,870          7,099     23,961,301

   Exercise of employee stock options                             2,525             25                                       11,716

   Conversion of nonvoting to voting common stock               709,870          7,099       (709,870)        (7,099)

   Repayment of stockholder notes receivable

   Net income
                                                            -----------    -----------    -----------    -----------    -----------

BALANCES AT SEPTEMBER 30, 1999                                4,498,618         44,986             --             --     23,973,017

   Exercise of employee stock options                           176,401          1,764                                      906,229

   Repayment of stockholder notes receivable

   Net income
                                                            -----------    -----------    -----------    -----------    -----------

BALANCES AT SEPTEMBER 30, 2000                                4,675,019    $    46,750             --    $        --    $24,879,246
                                                            ===========    ===========    ===========    ===========    ===========

<CAPTION>

                                                                                          STOCKHOLDER       TOTAL
                                                              RETAINED      TREASURY         NOTES      STOCKHOLDERS'
                                                              EARNINGS        STOCK        RECEIVABLE      EQUITY
<S>                                                         <C>           <C>            <C>            <C>
BALANCES AT OCTOBER 1, 1997                                  $ 8,548,543   $  (349,371)   $  (415,052)   $31,367,977

   Exercise of employee stock options                                                                        172,405

   Issuance of common stock - Foremost acquisition (Note 2)                                                  250,000

   Repayment of stockholder notes receivable                                                  314,857        314,857

   Purchase of treasury stock, 18,693 shares                                  (184,674)                     (184,674)

   Net income                                                    329,910                                     329,910
                                                             -----------   -----------    -----------    -----------

BALANCES AT SEPTEMBER 30, 1998                                 8,878,453      (534,045)      (100,195)    32,250,475

   Exercise of employee stock options                                                                         11,741

   Conversion of nonvoting to voting common stock                                                                 --

   Repayment of stockholder notes receivable                                                    5,000          5,000

   Net income                                                  2,978,319                                   2,978,319
                                                             -----------   -----------    -----------    -----------

BALANCES AT SEPTEMBER 30, 1999                                11,856,772      (534,045)       (95,195)    35,245,535

   Exercise of employee stock options                                                        (106,484)       801,509

   Repayment of stockholder notes receivable                                                    5,000          5,000

   Net income                                                    526,717                                     526,717
                                                             -----------   -----------    -----------    -----------

BALANCES AT SEPTEMBER 30, 2000                               $12,383,489   $  (534,045)   $  (196,679)   $36,578,761
                                                             ===========   ===========    ===========    ===========
</TABLE>



See notes to consolidated financial statements.


                                      F-5
<PAGE>   28


TUFCO TECHNOLOGIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS
YEARS ENDED SEPTEMBER 30, 2000, 1999 AND 1998
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                                           2000              1999            1998
<S>                                                                     <C>              <C>              <C>
OPERATING ACTIVITIES:
   Net income                                                           $   526,717      $ 2,978,319      $   329,910
   Noncash items in net income:
      Depreciation and amortization of property, plant and equipment      2,928,108        2,473,370        2,057,458
      Amortization of goodwill and other assets                             607,206          617,069          547,322
      Deferred income taxes                                                 (95,726)         512,800          127,975
      Increase in allowance for doubtful accounts                           321,900          121,270           36,957
      (Gain) loss on asset sales                                           (327,331)      (1,047,591)          36,925
      Property write-downs                                                  153,350                           250,000
   Changes in operating working capital:
      Accounts receivable                                                  (313,857)      (2,491,228)      (1,641,425)
      Inventories                                                           311,055         (864,788)         424,124
      Prepaid expenses and other assets                                     477,231         (453,678)         (60,076)
      Accounts payable                                                    3,200,685         (795,315)         541,150
      Accrued and other current liabilities                                (137,468)         807,030          372,939
      Income taxes payable/receivable                                      (735,445)         110,634         (626,841)
                                                                        -----------      -----------      ------------

           Net cash from operations                                       6,916,425        1,967,892        2,396,418
                                                                        -----------      -----------      -----------

INVESTING ACTIVITIES:
   Acquisition of Foremost - net of cash acquired                                           (142,000)      (5,985,019)
   Additions to property, plant and equipment                            (7,072,967)      (3,129,687)      (2,628,927)
   Deposits (made on) applied to purchases of equipment                                      144,853       (1,068,286)
   Advances to directors and former owners                                  (16,581)         (45,513)         (22,221)
   Collection of advances to directors and former owners                    140,750
   Proceeds from asset sales, net of transaction costs                      898,352        4,040,363           26,103
   (Increase) decrease in restricted cash                                   (11,667)             278           39,800
                                                                        -----------      -----------      -----------

           Net cash from (used in) investing activities                  (6,062,113)         868,294       (9,638,550)
                                                                        -----------      -----------      ------------

FINANCING ACTIVITIES:
   Issuance of long-term debt                                                                               8,797,280
   Repayment of long-term debt                                           (1,422,435)      (3,167,035)      (1,599,030)
   Proceeds from issuance of common stock                                   801,509           11,741          172,405
   Purchase of treasury stock                                                                                (184,674)
   Repayment of stockholder notes receivable                                  5,000            5,000          314,857
                                                                        -----------      -----------      -----------

           Net cash from (used in) financing activities                    (615,926)      (3,150,294)       7,500,838
                                                                        -----------      ------------     -----------

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                        238,386         (314,108)         258,706

CASH AND CASH EQUIVALENTS:
   Beginning of year                                                        692,002        1,006,110          747,404
                                                                        -----------      -----------      -----------
   End of year                                                          $   930,388      $   692,002      $ 1,006,110
                                                                        ===========      ===========      ===========
</TABLE>


SUPPLEMENTAL INFORMATION (Note 13)


See notes to consolidated financial statements.



                                      F-6
<PAGE>   29




TUFCO TECHNOLOGIES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED SEPTEMBER 30, 2000, 1999 AND 1998
--------------------------------------------------------------------------------


1.    SIGNIFICANT ACCOUNTING POLICIES

      CONSOLIDATED FINANCIAL STATEMENTS include the accounts of Tufco
      Technologies, Inc. and its wholly owned subsidiaries (the "Company").
      Significant intercompany transactions and balances are eliminated in
      consolidation. The Company markets its own line of business imaging paper
      products, tissues, towels and wipes for public-use facilities, and
      performs specialty printing, custom converting and packaging. The Company
      also manufactures and distributes a wide variety of consumer disposables
      that are sold in the home improvement and paint retailing industries.

      FINANCIAL STATEMENT PREPARATION requires management to make estimates and
      assumptions that affect the reported amounts of assets and liabilities and
      disclosure of contingencies at the date of the financial statements and
      the reported amounts of revenues and expenses for the period. Differences
      from those estimates are recognized in the period they become known.

      CASH EQUIVALENTS represent liquid investments with maturities at
      acquisition of three months or less.

      INVENTORIES are stated at the lower of cost or market. Cost is determined
      by the first-in, first-out ("FIFO") method.

      PROPERTY, PLANT AND EQUIPMENT are stated at cost less accumulated
      depreciation and amortization. Depreciation and amortization are provided
      using the straight-line method over the following estimated useful lives:
      20 to 40 years for buildings, 3 to 10 years for machinery and equipment, 3
      to 5 years for computer equipment and software, 5 to 7 years for furniture
      and fixtures, and the shorter of the lease term or the asset's useful life
      for leasehold improvements. Management periodically reviews asset carrying
      values for recoverability and, where appropriate, provides for write-downs
      to estimated fair value.

      GOODWILL represents the excess of cost over fair value of net assets
      acquired in business combinations, is amortized on a straight-line basis
      over 25 to 40 years and is stated net of accumulated amortization of
      $3,276,953 and $2,669,747 at September 30, 2000 and 1999, respectively.
      Management continues to review the carrying values of goodwill for
      recoverability using estimated future cash flows of related operations.

      FINANCIAL INSTRUMENTS consist of cash, receivables, payables, debt and
      letters of credit. Their carrying values or disclosed values are estimated
      to approximate their fair values unless otherwise indicated due to their
      short maturities, variable interest rates or fixed rates approximating
      current rates available for similar instruments.

      OTHER ASSETS include loan origination fees, which are amortized on a
      straight-line basis (approximating the interest method) over the terms of
      the related long-term debt.

      DEFERRED INCOME TAXES are provided under the asset and liability method
      for temporary differences in the recognition of certain revenues and
      expenses for tax and financial reporting purposes.


                                      F-7
<PAGE>   30

      REVENUES are recognized as sales when goods are shipped and title
      transfers to the customer.

      STOCK-BASED COMPENSATION arising from stock option grants is accounted for
      by the intrinsic value method under Accounting Principles Board ("APB")
      Opinion No. 25. Statement of Financial Accounting Standards ("SFAS") No.
      123 encourages (but does not require) the cost of stock options and other
      stock-based compensation arrangements with employees to be measured based
      on the fair value of the equity instrument awarded. As permitted by SFAS
      No. 123, the Company applies APB Opinion No. 25 to its stock-based
      compensation awards to employees and discloses in Note 11 the required pro
      forma effect on net income and earnings per share.

      BASIC EARNINGS PER SHARE is based on the weighted average number of common
      voting and nonvoting shares outstanding. Diluted earnings per share
      includes common equivalent shares from dilutive stock options outstanding
      during the year, the effect of which was 122,927, 55,943 and 98,086 shares
      in fiscal 2000, 1999 and 1998, respectively.

      RECLASSIFICATIONS of certain 1998 and 1999 amounts have been made to
      conform to the 2000 presentation.

2.    ACQUISITION

      Effective November 13, 1997, the Company acquired all of the outstanding
      stock of Foremost Manufacturing Company, Inc. in St. Louis, Missouri,
      which is engaged primarily in the manufacture and distribution of paint
      sundry products. The Foremost stock was acquired for $5,250,000 in cash,
      which the Company financed with additional bank borrowings, and 25,907
      common shares of the Company valued at $250,000. During fiscal 1999, the
      Company paid $500,000 as additional purchase price consideration under an
      earn-out provision, of which the Company had accrued $400,000 in 1998. The
      total cost of the acquisition, $6,183,208, including transaction costs,
      exceeded the fair value of the net assets acquired by $5,341,248, which
      was recorded as goodwill.



                                      F-8
<PAGE>   31


      This acquisition was accounted for under the purchase method. The results
      of the acquired operations are included in the consolidated financial
      statements from the acquisition date. The unaudited consolidated results
      of operations on a pro forma basis as though Foremost were acquired and
      the related common shares were issued as of the beginning of the Company's
      fiscal year 1998 is as follows:

<TABLE>
<S>                                                            <C>
        Net sales                                              $   77,702,435
                                                               ==============
        Income before extraordinary item                       $      401,070
                                                               ==============
        Net income                                             $      338,839
                                                               ==============
        Earnings per share:
           Income before extraordinary item:
              Basic                                            $          .09
                                                               ==============
              Diluted                                          $          .09
                                                               ==============
           Net income:
              Basic                                            $          .08
                                                               ==============
              Diluted                                          $          .08
                                                               ==============
        Weighted average common shares outstanding:
           Basic                                                    4,421,922
                                                               ==============
           Diluted                                                  4,520,000
                                                               ==============
</TABLE>

3.    ACCOUNTS RECEIVABLE

      Accounts receivable are stated net of allowances for doubtful accounts of
      $661,530 and $339,630 at September 30, 2000 and 1999, respectively.
      Amounts due from two customers represent 49% and 45% of total accounts
      receivable at September 30, 2000 and 1999, respectively. Accounts
      receivable at September 30, 2000 and 1999, include $1.8 million for the
      cost of equipment to be reimbursed by one of these customers.

4.    INVENTORIES

      Inventories at September 30 consist of the following:

<TABLE>
<CAPTION>
                                                2000               1999
<S>                                          <C>               <C>
        Raw materials                        $  4,485,263      $  4,670,120
        Finished goods                          3,427,219         3,578,756
                                             ------------      ------------

        Total inventories                    $  7,912,482      $  8,248,876
                                             ============      ============
</TABLE>



                                      F-9
<PAGE>   32


5.    PROPERTY, PLANT AND EQUIPMENT

      Property, plant and equipment at September 30 consist of the following:

<TABLE>
<CAPTION>
                                                                                       2000                 1999

<S>                                                                                <C>                  <C>
        Land and land improvements                                                 $     517,928        $     517,928
        Buildings                                                                      8,232,844            6,942,036
        Leasehold improvements                                                         1,555,615            1,433,497
        Machinery and equipment                                                       18,790,803           17,357,747
        Computer equipment and software                                                4,607,865            4,052,167
        Furniture and fixtures                                                           885,334              690,748
        Vehicles                                                                          78,280               97,255
                                                                                   -------------        -------------

                                                                                      34,668,669           31,091,378

        Less accumulated depreciation and amortization                                16,833,108           14,678,060
                                                                                   -------------        -------------

        Net depreciated value                                                         17,835,561           16,413,318

        Construction in progress                                                       2,347,277              223,438
                                                                                   -------------        -------------


        Property, plant and equipment - net                                        $  20,182,838        $  16,636,756
                                                                                   =============        =============
</TABLE>


      Gains on asset sales in fiscal 1999 include $699,000 realized from the
      sale of equipment and inventory related to the Away-From-Home ("AFH")
      product line (see Note 14) and $349,000 from the sale of other equipment,
      primarily in the Green Bay facility.

6.    OTHER ASSETS

      Other assets at September 30 consist of the following:

<TABLE>
<CAPTION>
                                                                                        2000                 1999
<S>                                                                                 <C>                  <C>
        Loan origination and other fees                                             $    424,323         $    372,281
        Less accumulated amortization                                                    231,344              110,110
                                                                                    ------------         ------------

        Subtotal                                                                         192,979              262,171

        Note receivable bearing interest at 7% to 10%, due in
           variable monthly installments through 2005                                     55,601               10,495
        Prepaid rent on leased equipment                                                 362,440
        Deposits on equipment to be acquired and other                                   127,391            1,024,253
        Advances to certain directors and former owners                                  172,005              296,174
        Maintenance contract                                                              21,079
        Cash value of life insurance                                                       8,316                8,316
                                                                                    ------------         ------------

        Other assets - net                                                          $    939,811         $  1,601,409
                                                                                    ============         ============
</TABLE>



                                      F-10
<PAGE>   33


7.     LONG-TERM DEBT

<TABLE>
<CAPTION>
       Long-term debt at September 30 consists of the following:

                                                                                            2000                   1999
<S>                                                                                    <C>                  <C>

       Note payable to bank, collateralized by substantially all assets of the
       Company, bearing a variable interest of 7.93% and 6.74% at September 30,
       2000 and 1999, respectively, fixed at 7.12% under an interest rate swap
       arrangement discussed below, installments are due quarterly at $380,358,
       with final payment due on August 1, 2005                                         $   5,107,136         $   6,628,568

       Notes payable to bank, under a revolving line-of-credit agreement (not
       to exceed maximum borrowings of $12 million, reduced by outstanding
       letters of credit - see Note 9), collateralized by substantially all
       assets of the Company, bearing interest at a combination of 100 basis
       points over LIBOR or .75% below the bank's reference rate (effective
       rate of 8.08% and 6.99% at September 30, 2000 and 1999, respectively),
       payable quarterly, due on June 1, 2002                                               6,500,000             6,020,000

       Variable rate (5.75% and 3.95% at September 30, 2000 and 1999,
       respectively) note payable underlying Industrial Development Revenue
       Bonds, collateralized by substantially all assets of the Company, due in
       annual installments of $250,000 beginning 2000 through 2006, interest
       payable monthly                                                                      1,500,000             1,750,000

       Capital lease obligation, payable in monthly installments
       through 2000                                                                                                 131,003
                                                                                        -------------         -------------

       Total                                                                               13,107,136            14,529,571

       Less current portion                                                                 1,771,432             1,902,435
                                                                                        -------------         -------------

       Long-term debt - less current portion                                            $  11,335,704         $  12,627,136
                                                                                        =============         =============

       Long-term debt - less current portion matures as follows:

        2002                                                                                                  $   8,271,432
        2003                                                                                                      1,771,432
        2004                                                                                                        792,840
        2005                                                                                                        250,000
        2006                                                                                                        250,000
                                                                                                              -------------

        Total                                                                                                 $  11,335,704
                                                                                                              =============
</TABLE>

      In connection with term debt, the Company paid $94,000 in 1998 to its
      former lender to exit the prior credit agreement, principally in the form
      of prepayment penalties on the early repayment of term debt. These costs
      are reflected as an extraordinary item in the consolidated statements of
      income. With the refinancing, the Company entered into an interest rate
      swap agreement, as a hedge under which the interest rate on the term debt
      is fixed at 5.87%, plus a profit spread for the lender of between 100 and
      150 basis points, depending on certain financial ratios achieved by the
      Company. The fair value of this


                                      F-11
<PAGE>   34

      swap agreement is estimated to be a net receivable position of $61,000 and
      $45,000 at September 30, 2000 and 1999, respectively.

      Loan agreements for all notes except those underlying the Industrial
      Development Revenue Bonds contain certain restrictive covenants, including
      requirements to maintain minimum fixed charge coverage, minimum tangible
      net worth, and restrictions on maximum allowable debt, capital purchases,
      stock purchases, mergers and payment of dividends. The Company has a
      standby letter of credit for the outstanding balance associated with the
      Industrial Development Revenue Bonds.

8.    INCOME TAXES

      The tax effects of significant items composing the Company's net deferred
      tax liability as of September 30 are as follows:

<TABLE>
<CAPTION>
                                                                                        2000                 1999
<S>                                                                                 <C>                  <C>
        Current deferred tax asset:
           Valuation allowances for accounts receivable and inventories,
              not currently deductible                                              $     569,298        $     227,068
           Inventory costs capitalized for tax purposes                                    28,399               29,064
           Vacation and severance accruals, not currently deductible                       64,711               64,711
           Other accruals, not currently deductible                                        65,659               60,640
           Other                                                                           68,107               65,613
                                                                                    -------------        -------------

        Total                                                                             796,174              447,096

        Noncurrent deferred tax liability:
           Accelerated tax depreciation on property and equipment                      (1,753,675)          (1,571,859)
           Accelerated tax amortization of goodwill                                      (868,640)            (734,206)
           Other                                                                          120,092               57,194
                                                                                    -------------        -------------

        Total                                                                          (2,502,223)          (2,248,871)
                                                                                    -------------        -------------

        Net deferred tax liability                                                  $  (1,706,049)       $  (1,801,775)
                                                                                    =============        =============
</TABLE>


                                      F-12
<PAGE>   35


      The resulting components of income tax expense (benefit) are as follows:


<TABLE>
<CAPTION>
                                                                            2000             1999            1998
<S>                                                                      <C>             <C>               <C>
        Current tax expense:
           Federal                                                       $   561,766     $  1,213,557      $   301,474
           State                                                              27,385           75,859           22,341
                                                                         -----------     ------------      -----------

        Total                                                                589,151        1,289,416          323,815

        Deferred tax expense (benefit):
           Federal                                                           (89,599)         480,011          119,210
           State                                                              (6,127)          32,789            8,765
                                                                         -----------     ------------      -----------

        Total                                                                (95,726)         512,800          127,975
                                                                         -----------     ------------      -----------

        Income tax expense                                               $   493,425     $  1,802,216      $   451,790
                                                                         ===========     ============      ===========
</TABLE>


      Income tax expense varies from the amount determined by applying the
      applicable statutory income tax rates to pretax income as follows:

<TABLE>
<CAPTION>
                                                                           2000              1999             1998

<S>                                                                     <C>              <C>              <C>
        Federal income taxes computed at statutory rates                $    346,850     $  1,625,382     $    286,937
        State income taxes, net of federal tax benefit                        14,030           71,708           20,530
        Certain goodwill amortization and other
           nondeductibles                                                    161,329          157,641          114,182
        Other                                                                (28,784)         (52,515)          30,141
                                                                        ------------     -------------    ------------

        Income tax expense                                              $    493,425     $  1,802,216     $    451,790
                                                                        ============     ============     ============
</TABLE>


9.    COMMITMENTS AND CONTINGENCIES

      LEASES - The Company leases facilities in Green Bay, Wisconsin, from a
      partnership composed of certain current and former stockholders. The lease
      expires in 2003, is classified as an operating lease and requires monthly
      rental payments of $9,255. The Company has the option of renewing the
      lease for a three-year period with rental amounts renegotiated. Rental
      expense for the lease totaled $111,060 annually for fiscal 2000, 1999 and
      1998.

      The Company entered into an agreement with a third party to construct and
      lease a 62,000-square-foot facility in Manning, South Carolina, which the
      Company occupied in October 1996. The five-year agreement is an operating
      lease with rental payments of $11,489 per month. The Company has three
      contiguous options to renew the lease for successive five-year terms
      beginning at the end of the fifth year. The Company also has the option of
      purchasing the building for $1,100,000. If the purchase and renewal
      options are not exercised, the Company may be required to pay the lessor a
      residual amount of up to $900,000, depending upon the extent, if any, that
      the facility's value has diminished during the lease term. A portion of
      the scheduled lease payments is placed in escrow and is included in
      restricted cash of $31,717 and $20,050 at September 30, 2000 and 1999,
      respectively. The Company has a standby letter of credit with its bank for
      the payment of the future lease obligations.


                                      F-13
<PAGE>   36

      The Company also leases other facilities and equipment under operating
      leases. Office and warehouse leases expire in November 2000 and February
      2003. The equipment leases expire on varying dates over the next five
      years.

      Future minimum rental commitments under operating leases with initial or
      remaining terms in excess of one year at September 30, 2000, are as
      follows:

<TABLE>
<S>                                                    <C>
        2001                                             $  1,560,117
        2002                                                2,253,035
        2003                                                  853,581
        2004                                                  505,549
        2005                                                  470,681
                                                         ------------

        Total                                            $  5,642,963
                                                         ============
</TABLE>

      Net rental expense for all operating leases totaled $1,675,915, $1,270,833
      and $1,123,912 for fiscal 2000, 1999 and 1998, respectively. The Company
      charges its customers for storage, which is netted against rental expense.

      COMMERCIAL LETTERS OF CREDIT - The Company has outstanding commercial
      import letters of credit of $105,067 and $0 as of September 30, 2000 and
      1999, respectively. These letters of credit collateralize the Company's
      obligations to third parties for the purchase of inventory. The Company
      has unused letters of credit of $644,933 and $750,000 available at
      September 30, 2000 and 1999, respectively.

      LITIGATION - The Company is subject to lawsuits, investigation and
      potential claims arising out of the ordinary conduct of its business.
      Management believes the outcome of these matters will not materially
      affect the financial position, results of operations or cash flows of the
      Company.

10.   PROFIT SHARING PLANS

      The Company has a defined contribution profit sharing 401(k) plan covering
      substantially all employees. The Company makes annual contributions at the
      discretion of the board of directors. In addition, the Company matches
      certain amounts of employees' contributions. Profit sharing plan expense
      relating to the defined contribution profit sharing 401(k) plan totaled
      $201,131, $268,657 and $209,215 for fiscal 2000, 1999 and 1998,
      respectively.

11.   STOCKHOLDERS' EQUITY

      NONVOTING COMMON STOCK AND PREFERRED STOCK - Each record holder of
      nonvoting common stock was entitled at any time to convert any or all of
      such shares into the same number of shares of voting common stock. During
      fiscal 1999, the holders of all 709,870 shares of nonvoting common stock
      exercised their right to convert the shares to voting common stock. At
      September 30, 2000, the Company has authorized and unissued 2,000,000
      shares of $.01 par value nonvoting common stock and 1,000,000 shares of
      $.01 par value preferred stock.

      STOCK COMPENSATION ARRANGEMENTS - The Non-Qualified Stock Option Plan
      currently reserves 650,000 shares of common stock for grants to selected
      employees through April 30, 2002, and provides that the price and exercise
      period be determined by the board of directors. Options vest primarily
      over three years and expire five years from date of grant. During fiscal
      2000, 1999 and 1998, options to purchase 200,000, 70,000 and 86,000
      shares, respectively, of voting common stock were granted.


                                      F-14
<PAGE>   37

      The Non-Employee Director Stock Option Plan for nonemployee members of the
      board of directors reserves 200,000 shares of common stock for grants
      through March 2004 and provides that the purchase price be fair market
      value at the date of grant. Options are exercisable immediately and for a
      period of 10 years. During fiscal 2000, 1999 and 1998, options to purchase
      15,000, 8,000 and 12,000 shares, respectively, of voting common stock were
      granted.

      The following information summarizes the shares subject to options:

<TABLE>
<CAPTION>
                                                                                                        WEIGHTED AVERAGE EXERCISE
                                                                          NUMBER OF SHARES                   PRICE PER SHARE
                                                                 ----------------------------------   -----------------------------
                                                                    2000        1999        1998         2000       1999      1998
<S>                                                                <C>         <C>         <C>          <C>        <C>      <C>
        Options outstanding, beginning of year                     445,306     412,441     364,127      $6.63      $6.69    $ 6.01

        Granted                                                    215,000      78,000      98,000       8.91       6.92      9.62

        Exercised                                                 (176,401)     (2,525)    (37,396)      5.15       4.65      6.50

        Terminated                                                  (7,100)    (42,610)    (12,290)      8.55       7.41     10.07
                                                                  --------    --------    --------

        Options outstanding, end of year                           476,805     445,306     412,441       8.20       6.63      6.69
                                                                  ========     =======    ========

        Options exercisable, end of year                           281,138     311,639     261,332       7.74       6.14      5.89
                                                                  ========    ========    ========

        Reserved for future options at September 30, 2000          373,195
                                                                  ========
</TABLE>

      The following table summarizes additional information about stock options
      outstanding and exercisable at September 30, 2000:


<TABLE>
<CAPTION>
                                     OPTIONS OUTSTANDING                   OPTIONS EXERCISABLE
                         ------------------------------------------      ------------------------
                                          WEIGHTED
                                           AVERAGE        WEIGHTED                      WEIGHTED
            RANGE OF                      REMAINING        AVERAGE                       AVERAGE
            EXERCISE      NUMBER OF      CONTRACTUAL      EXERCISE        NUMBER OF     EXERCISE
             PRICES        SHARES           LIFE            PRICE          SHARES        PRICE
<S>                      <C>            <C>              <C>              <C>           <C>
         $4.50 - 7.00      174,405        2.5 years         $6.78          153,738        $6.75
          7.00 - 10.00     302,400        4.4 years          8.98          127,400         8.94
                           -------                                         -------

         4.50 - 10.00      476,805        3.7 years          8.18          281,138         7.74
                           =======                                         =======
</TABLE>

      The Company applies APB No. 25 and related Interpretations in accounting
      for its stock option plans. No compensation cost has been recognized for
      the Company's stock option plans because the quoted market price of the
      common stock at the date of grant was not in excess of the option exercise
      price. SFAS No. 123 prescribes a method to record compensation cost at the
      fair value of the options granted. Pro forma disclosures as if the Company
      had adopted the cost recognition requirements under SFAS No. 123 in fiscal
      2000, 1999 and 1998 are presented below. Because the SFAS No. 123 method


                                      F-15
<PAGE>   38


      of accounting has not been applied to options granted prior to October 1,
      1995, the resulting pro forma compensation cost may not be representative
      of that expected in future years.

<TABLE>
<CAPTION>
                                                   2000           1999            1998
<S>                                             <C>          <C>               <C>
        Net income:
           As reported                           $526,717    $  2,978,319       $329,910
           Pro forma                              248,235       2,807,000        129,000

        Basic earnings per share:
           As reported                                .12             .67            .07
           Pro forma                                  .06             .63            .03

        Diluted earnings per share:
           As reported                                .11             .67            .07
           Pro forma                                  .05             .63            .03
</TABLE>


      In the pro forma calculations, the weighted average fair value of options
      granted during 2000, 1999 and 1998 was estimated at $3.55, $3.18 and $4.40
      per share, respectively. The fair value of each option grant is estimated
      on the date of grant using the Black-Scholes option-pricing model with the
      following weighted average assumptions used for grants in 2000, 1999 and
      1998: risk-free interest rates of 5% for all years; dividend yield of 0.0%
      for all years; expected lives of four to five years; and expected
      volatility of 50% for all years, based on the historical weekly trading
      ranges of the Company's stock since its initial public offering in January
      1994.

      The Company sold shares to management employees under various stock
      purchase agreements, which included 16,937 shares at $4.80 to $6.75 per
      share in 1996. The purchases are financed by the Company through notes
      with the employees at 5% interest payable annually.

      In 2000, the Company received notes from various employees to facilitate
      the exercise of employee stock options. The notes receivable with recourse
      bear interest at 8.5% interest payable annually. All notes receivable
      outstanding at September 30, 2000, are due to be repaid in 2001. The
      outstanding balances of $196,679 and $95,195 at September 30, 2000 and
      1999, respectively, are presented as a reduction of stockholders' equity.

12.   RELATED-PARTY TRANSACTIONS

      The Company has an agreement with Bradford Ventures, Ltd., an affiliate of
      the two largest stockholders of the Company, under which Bradford
      Ventures, Ltd. provides various financial and management consulting
      services until January 2004, when the agreement will be automatically
      renewed unless terminated by either party. The agreement calls for an
      annual fee of $210,000 with annual increases of 5% plus reimbursement of
      reasonable out-of-pocket expenses. The Company believes the terms of its
      consulting agreement are comparable to those available from unaffiliated
      third parties for similar services. Consulting expense was $357,353,
      $251,161 and $236,440 for fiscal 2000, 1999 and 1998, respectively.



                                      F-16
<PAGE>   39


13.   SUPPLEMENTAL CASH FLOW INFORMATION

      The following is provided as supplemental information to the consolidated
statements of cash flows:

<TABLE>
<CAPTION>
                                                                         2000               1999             1998

<S>                                                                    <C>               <C>              <C>
        Interest paid                                                  $   965,823       $ 1,125,346      $ 1,098,538
                                                                       ===========       ===========      ===========

        Income taxes paid                                              $ 1,324,596       $ 1,178,782      $   927,431
                                                                       ===========       ===========      ===========

        Noncash investing and financing activities:
           Issuance of common stock - Foremost acquisition             $                 $        --      $   250,000
                                                                       ===========       ===========      ===========

           Conversion of nonvoting to voting common stock              $                 $     7,099      $        --
                                                                       ===========       ===========      ===========

           Purchase of treasury stock by reduction in
              stockholder notes receivable                             $        --       $        --      $   160,962
                                                                       ===========       ===========      ===========
</TABLE>


14.   MAJOR CUSTOMER AND SEGMENT INFORMATION

      In fiscal 2000, the Company had two significant customers that accounted
      for approximately 20% and 12% of total sales. In fiscal 1999, each
      accounted for approximately 10% of total sales. Both customers are Fortune
      500 companies, one of which was related to the Contract Manufacturing
      sector, and the other was primarily concentrated in the Paint Sundries
      sector. No customers accounted for greater than 10% of sales in fiscal
      1998.

      The Company operates in a single industry since it manufactures and
      distributes custom paper-based and woven products, and provides contract
      manufacturing, specialty printing and related services on these types of
      products. The Company does, however, separate its operations and prepare
      information for management use by the market sectors aligned with the
      Company's products and services. Such market sector information is
      summarized below. The Contract Manufacturing sector provides services to
      large national consumer products companies while the remaining sectors
      manufacture and distribute products ranging from paper goods to paint
      sundries. Accounts receivable and certain other assets are not assignable
      to specific sectors and, therefore, are included in the intersector column
      below. In June 1999, the Company sold its equipment and inventory related
      to its AFH products and services, and has ceased selling into this market
      sector.


<TABLE>
<CAPTION>
                                      CONTRACT      BUSINESS        PAINT        AWAY
              FISCAL 2000           MANUFACTURING   IMAGING        SUNDRIES     FROM HOME    INTERSECTOR  CONSOLIDATED
<S>                                 <C>           <C>           <C>            <C>                        <C>

        Net sales                    $34,242,390   $25,899,580   $18,810,298    $            $        --   $78,952,268

        Gross profit                   7,136,712     2,923,252       850,866                                10,910,830

        Operating income (loss)        5,795,483     1,229,916    (2,237,357)                 (2,829,211)    1,958,831

        Assets:
           Inventories                   884,335     3,764,341     3,263,806                                 7,912,482
           Property, plant and
              equipment - net          9,917,431     6,526,344       827,470                   2,911,593    20,182,838
           Accounts receivable
              and other (including
              goodwill)                                                                       34,037,828    34,037,828
                                     -----------   -----------   -----------    --------     -----------   -----------

           Total assets              $10,801,766   $10,290,685   $ 4,091,276    $            $36,949,421   $62,133,148
                                     ===========   ===========   ===========    ========     ===========   ===========
</TABLE>



                                      F-17
<PAGE>   40


<TABLE>
<CAPTION>
                                      CONTRACT     BUSINESS          PAINT        AWAY
              FISCAL 1999           MANUFACTURING   IMAGING        SUNDRIES     FROM HOME    INTERSECTOR  CONSOLIDATED
<S>                                  <C>           <C>           <C>            <C>          <C>           <C>
        Net sales                   $25,987,095   $24,965,919   $20,955,389    $4,422,160            --    $76,330,563

        Gross profit                  6,393,221     3,499,667     2,781,787       431,603                   13,106,278

        Operating income (loss)       5,636,946     1,272,918       195,474       429,979   $(1,708,641)     5,826,676

        Assets:
           Inventories                1,013,403     3,781,685     3,453,788                                  8,248,876
           Property, plant and
              equipment - net         7,167,498     7,076,601       644,440                    1,748,217    16,636,756
           Accounts receivable and
              other (including
              goodwill)                                                                       34,195,157    34,195,157
                                    -----------   -----------   -----------    ----------   ------------   -----------

           Total assets             $ 8,180,901   $10,858,286   $ 4,098,228    $       --   $ 35,943,374   $59,080,789
                                    ===========   ===========   ===========    ==========   ============   ===========
</TABLE>


      In fiscal 2000, the Company announced its intent and began to consolidate
      the Paint Sundries operations in Manning, South Carolina, and has accrued
      at September 30, 2000, the estimated asset write-downs and other costs of
      approximately $831,000 to close its St. Louis facility and move the
      related inventory, equipment and personnel to Manning.

                                     ******




                                      F-18
<PAGE>   41


                               INDEX TO EXHIBITS


<TABLE>
<CAPTION>
       EXHIBIT
       NUMBER                      DESCRIPTION
       ------                      -----------
<S>                       <C>
       2.1                  Stock Purchase Agreement dated as of November 12,
                            1997 by and among Tufco Technologies, Inc. (the
                            "Company"), Charles Cobaugh and James Barnes (filed
                            as exhibit 2.1 to the Company's Form 8-K dated
                            November 13, 1997 filed with the Commission on
                            November 26, 1997 file number 0-21018, incorporated
                            by reference herein).

       3.1                  Restated Certificate of Incorporation (1) (Exhibit
                            3.1)

       3.2                  Bylaws (1) (Exhibit 3.2)

       10.1                 Stock Purchase and Contribution Agreement, dated as
                            of February 25, 1992, among the Company, Tufco
                            Industries, Inc. ("Tufco"), and the Stockholders of
                            Tufco. (1) (Exhibit 10.1)

       10.2                 Amended and Restated Consulting Agreement with
                            Bradford Investment Partners, L.P. (3) (Exhibit 10)

       10.3                 Loan Agreement, dated May 1, 1992, between the
                            Village of Ashwaubenon, Wisconsin, and the Company.
                            (1) (Exhibit 10.11)

       10.4                 1992 Non-Qualified Stock Option Plan (1) (Exhibit
                            10.12)

       10.5                 Form of Employee Stock Purchase Agreement between
                            the Company and certain key employees of the
                            Company. (1) (Exhibit 10.17)

       10.6                 1993 Non-Employee Director Stock Option Plan. (2)
                            (Exhibit 10.19)

       10.7                 Amended Employment Agreement with Greg Wilemon,
                            dated September 18, 1995. (4) (Exhibit 10.11)

       10.8                 Lease Agreement, dated as of March 1, 1995, between
                            Bero, Garland, Gebhardt and McClure, a Wisconsin
                            partnership, and Tufco. (4) (Exhibit 10.13)

       10.9                 Lease Agreement dated as of April 1, 1996, between
                            Bero, Garland, Gebhardt and McClure, a Wisconsin
                            partnership, and Tufco. (3) (Exhibit 10.15)

       10.10                Employment Agreement with Louis LeCalsey, III dated
                            September 19, 1996. (5) (Exhibit 10.18)

       10.11                Credit Agreement among Tufco L.P. as Borrower, the
                            Company as the Parent First Union National Bank as
                            agent and the banks named herein dated August 28,
                            1998. (4)

       10.12                ISDA Master Agreement and Schedule to the Master
                            Agreement dated as of July 30, 1998 between First
                            Union National Bank and Tufco, L.P. (5)

       10.13                First Amendment to Credit Agreement. (5)

       10.14                Second Amendment to Credit Agreement. (6)

       21.1                 Subsidiaries of the Company. (5)

       27.1*                Financial Data Schedule

       99.1*                Employee Stock Purchase Agreement executed by Greg
                            Wilemon in favor of the company dated September 30,
                            2000. (Exhibit 99.1)
</TABLE>


       *      Filed herewith

       (1)    Incorporated by reference to the Company's Registration Statement
              on Form S-1 (Reg. No. 33-55828) (the "Registration Statement") as
              filed with the Commission on December 16, 1992.

       (2)    Incorporated by reference to Amendment No. 1 to the Registration
              Statement as filed with the Commission on November 23, 1993.

       (3)    Incorporated by reference to the Company's Quarterly Report on
              Form 10-Q for the quarterly period ended March 31, 1995.

       (3)    Incorporated by reference to the Company's Annual Report on Form
              10-K for the period ended September 30, 1995.

       (4)    Incorporated by reference to the Company's Annual Report on Form
              10-K for the period ended September 30, 1997.

       (5)    Incorporated by reference to the Company's Annual Report on Form
              10-K for the period ended September 30, 1998.

       (6)    Incorporated by reference to the Company's Annual Report of Form
              10-Q for the period ended June 30, 2000.