<PAGE>
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

           [X] Quarterly Report Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934

                For the quarterly period ended December 31, 2005

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

      For the transition period from ______________ to ____________________

                         COMMISSION FILE NUMBER 0-08791

                            PVC CONTAINER CORPORATION
             (Exact name of registrant as specified in its charter)

<TABLE>
<S>                                                          <C>
            Delaware                                              13-2616435
(State or other jurisdiction of                                (I.R.S. Employer
 incorporation or organization)                              Identification No.)
</TABLE>

               2 Industrial Way West, Eatontown, New Jersey 07724
              (Address of principal executive offices and zip code)

        Registrant's telephone number, including area code (732) 542-0060

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 whether the registrant is a large accelerated filer, an
accelerated filer, or a non-accelerated filer. See definition of "accelerated
filer and large accelerated filer" in Rule 12b-2 of the Exchange Act. (Check
one):

[ ] Large accelerated filer   [ ] Accelerated Filer   [X] Non-accelerated filer

Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act).

                                                                  Yes [ ] No [X]

                                                                  Yes [ ] No [X]

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

<TABLE>
<CAPTION>
            Class                            Outstanding as of February 14, 2006
            -----                            -----------------------------------
<S>                                          <C>
Common Stock, $.01 par value                           7,042,393 shares
</TABLE>

<PAGE>

                                    CONTENTS

<TABLE>
<CAPTION>
                                                                            PAGE
                                                                             NO.
                                                                           -----
<S>                                                                        <C>
PART I.  FINANCIAL INFORMATION

Item 1.  Financial Statements

Consolidated Balance Sheets - December 31, 2005, and June 30, 2005
(Unaudited)                                                                  3

Consolidated Statements of Operations - Three and Six Months Ended
December 31, 2005, and 2004 (Unaudited)                                      4

Consolidated Statements of Cash Flows - Six Months Ended
December 31, 2005, and 2004 (Unaudited)                                      5

Notes to Consolidated Financial Statements                                  6-14

Item 2.  Management's Discussion and Analysis of Financial
Condition and Results of Operations                                        15-21

Item 3.  Quantitative and Qualitative Disclosures About Market Risk          21

Item 4.  Controls and Procedures                                             21

PART II. OTHER INFORMATION

Item 1.  Legal Proceedings                                                   22

Item 6.  Exhibits                                                            22

Signatures                                                                   23

Exhibit Index                                                                24
</TABLE>


                                        2

<PAGE>

Part I Financial Information
Item 1. Financial Statements

                            PVC Container Corporation
                           Consolidated Balance Sheets
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                              December        June
                                                              31, 2005      30, 2005
                                                            -----------   -----------
<S>                                                         <C>           <C>
ASSETS
Current assets:
   Cash and cash equivalents                                $   373,879   $   375,501
Accounts receivable, net of allowances of $791,696 and
      $1,009,000 at December 31, 2005, and June 30, 2005,
      respectively                                           10,900,417    14,085,835
   Inventories                                               11,030,991    11,185,304
   Prepaid expenses and other current assets                    881,712       998,704
   Prepaid income taxes and income tax receivables              411,701       674,839
   Deferred income taxes                                      2,405,929     2,601,104
   Net assets held for disposition                                   --     1,110,891
                                                            -----------   -----------
Total current assets                                         26,004,629    31,032,178
Properties, plant and equipment at cost, net                 21,251,665    22,244,711
Other assets                                                     20,000        37,074
                                                            -----------   -----------
                                                            $47,276,294   $53,313,963
                                                            ===========   ===========

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
   Accounts payable                                         $ 6,435,538   $ 6,166,815
   Accrued expenses                                           2,058,207     2,930,048
   Current portion of long-term debt                          2,551,958     2,682,145
                                                            -----------   -----------
Total current liabilities                                    11,045,703    11,779,008
Long-term debt                                               20,246,774    25,281,918
Interest rate swap                                                   --        22,588
Deferred income taxes                                         2,372,705     2,513,395
Other liabilities                                               140,000       140,000
Deferred income                                                 441,420       500,000

Stockholders' equity:
   Preferred stock, par value $1.00, authorized 1,000,000
      shares, none issued                                            --            --
   Common stock, par value $.01, authorized 10,000,000
      shares, 7,044,655 shares issued as of
      December 31, 2005, and June 30, 2005                       70,446        70,446
   Capital in excess of par value                             3,810,981     3,810,981
   Retained earnings                                          9,427,741     9,113,749
   Accumulated other comprehensive (loss) income               (274,681)       86,673
   Treasury stock, at cost (2,262 shares at December 31,
      2005, and June 30, 2005)                                   (4,795)       (4,795)
                                                            -----------   -----------
Total stockholders' equity                                   13,029,692    13,077,054
                                                            -----------   -----------
                                                            $47,276,294   $53,313,963
                                                            ===========   ===========
</TABLE>

See accompanying notes


                                        3

<PAGE>

                            PVC Container Corporation
                      Consolidated Statements of Operations
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                THREE MONTHS ENDED           SIX MONTHS ENDED
                                                                    December 31                December 31
                                                            -------------------------   -------------------------
                                                                2005          2004          2005          2004
                                                            -----------   -----------   -----------   -----------
<S>                                                         <C>           <C>           <C>           <C>
Net sales                                                   $20,977,683   $19,883,841   $39,453,071   $39,562,001

Cost and expenses:
   Cost of goods sold (exclusive of
      depreciation and amortization expense
      shown separately below)                                16,984,175    16,414,017    31,971,941    33,029,735
   Selling, general and administrative expenses               2,493,682     2,622,062     4,697,846     5,606,559
   Depreciation and amortization                              1,121,427     1,290,576     2,232,929     2,577,025
   Goodwill impairment charges                                       --     3,296,299            --     3,296,299
   Provision for restructure & other exit activities                 --       572,899            --       572,899
   Asset impairment                                                  --       448,615            --       448,615
                                                            -----------   -----------   -----------   -----------
                                                             20,599,284    24,644,468    38,902,716    45,531,132
                                                            -----------   -----------   -----------   -----------
Income (loss) from operations                                   378,399    (4,760,627)      550,355    (5,969,131)

Other income (expense):
   Interest expense                                            (388,978)     (429,176)     (834,587)     (836,220)
   Other income                                               1,669,089         1,500     1,669,089        43,000
                                                            -----------   -----------   -----------   -----------
                                                              1,280,111      (427,676)      834,502      (793,220)
                                                            -----------   -----------   -----------   -----------
Income (loss) before provision (benefit) for income taxes     1,658,510    (5,188,303)    1,384,857    (6,762,351)
Provision (benefit) for income taxes                            665,043      (314,931)      567,803      (960,866)
                                                            -----------   -----------   -----------   -----------
Income (loss) from continuing operations                    $   993,467   $(4,873,372)  $   817,054   $(5,801,485)
Discontinued operations
   Income (loss) from discontinued plastic compounding
      segment                                                   146,377      (190,091)     (842,521)     (103,445)
   Provision (benefit) for income taxes                          56,101      (121,624)     (339,458)      (66,188)
                                                            -----------   -----------   -----------   -----------
   Income (loss) from discontinued operations                    90,276       (68,467)     (503,063)      (37,257)
Net income (loss)                                           $ 1,083,743   $(4,941,839)  $   313,991   $(5,838,742)
                                                            ===========   ===========   ===========   ===========
Income (loss) per share (basic and diluted) from
   continuing operations                                    $      0.14        ($0.69)  $      0.12        ($0.82)
Income (loss) per share (basic and diluted) from
   discontinued operations                                  $      0.01        ($0.01)       ($0.07)       ($0.01)
Income (loss) per share (basic and diluted)                 $      0.15        ($0.70)  $      0.05        ($0.83)
</TABLE>

See accompanying notes.


                                        4

<PAGE>

                            PVC Container Corporation
                      Consolidated Statements of Cash Flows
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                          SIX MONTHS ENDED
                                                                            DECEMBER 31
                                                                     -------------------------
                                                                        2005           2004
                                                                     -----------   -----------
<S>                                                                  <C>           <C>
CASH FLOWS FROM CONTINUED AND DISCONTINUED OPERATING ACTIVITIES
Net income (loss)                                                    $   313,991   $(5,838,742)
Adjustments to reconcile net income (loss) to net cash provided by
   continued and discontinued
   operating activities:
      Depreciation and amortization                                    2,234,873     2,809,111
      Goodwill impairment                                                     --     3,296,298
      Asset impairment                                                        --       448,615
      Amortization of deferred financing costs                            14,648        86,578
      Deferred income taxes                                               54,485       (52,264)
      Gain on sale of equipment                                           (3,000)      (43,000)
      Gain on sale of building                                        (1,666,089)
      Insurance recoveries                                                    --       (30,000)
      Changes in assets and liabilities:
         Accounts receivable, net of allowances                        3,185,418     2,900,864
         Inventories, net of allowances                                  154,313    (2,541,821)
         Prepaid expenses and other current assets                       380,130    (1,228,501)
         Other assets                                                      2,427         8,884
         Accounts payable and accrued expenses                        (1,045,640)      267,717
                                                                     -----------   -----------
Net cash provided operating activities                                 3,625,556        83,739

CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures                                                  (1,241,827)     (845,338)
Proceeds from sale of equipment                                            3,000        43,000
Proceeds from sale of building                                         2,931,102
Capitalized improvements to building                                    (154,122)
Insurance recoveries                                                          --        30,000
                                                                     -----------   -----------
Net cash provided (used in) investing activities                       1,538,153      (772,338)

CASH FLOWS FROM FINANCING ACTIVITIES
Net proceeds (payments) from revolving credit line                    (1,590,602)    2,415,435
Payments of indebtedness                                              (4,417,594)   (1,935,641)
Proceeds from long-term debt                                             842,865       331,117
Deferred financing costs                                                      --       (50,000)
                                                                     -----------   -----------
Net cash provided (used) by financing activities                      (5,165,331)      760,911
                                                                     -----------   -----------
Net increase (decrease) in cash and cash equivalents                      (1,622)       72,312
Cash and cash equivalents at beginning of period                         375,501       365,820
Cash and cash equivalents at end of period                           $   373,879   $   438,132
                                                                     ===========   ===========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Interest paid                                                        $   751,566   $   871,438
                                                                     ===========   ===========
Income taxes paid                                                    $    41,625   $    32,625
                                                                     ===========   ===========
</TABLE>

See accompanying notes


                                        5

<PAGE>

Note 1 Description of Business

General

PVC Container Corporation (the "Company") was incorporated in Delaware in 1968.
The Company's major business activity is manufacturing and selling a line of
plastic bottles made from polyvinyl chloride ("PVC") compounds, high-density
polyethylene ("HDPE"), and polyethylene terephthalate ("PET") resins. The
Company sells these bottles through Novapak Corporation, which is a wholly-owned
subsidiary. Another wholly-owned subsidiary, Airopak Corporation, produces
bottles that are fluorinated to improve the chemical resistance and barrier
properties. The Company's products are used primarily to package cosmetics,
toiletries, foods, household chemicals, and lawn and garden and industrial
chemical products.

Note 2 Basis of Presentation

The accompanying unaudited consolidated financial statements have been prepared
in accordance with accounting principles generally accepted in the United States
for interim financial reporting, pursuant to the rules and regulations of the
Securities and Exchange Commission. In management's opinion, the accompanying
consolidated financial statements contain all adjustments (consisting of only
normal recurring adjustments) necessary to present fairly the Company's
financial position as of December 31, 2005, and the results of operations for
the three and six months and cash flows for the six-month periods ended December
31, 2005, and 2004. Operating results for the three-month and six-month periods
ended December 31, 2005, are not necessarily indicative of the results that may
be expected for the year ended June 30, 2006.

The accompanying consolidated financial statements include the accounts of PVC
Container Corporation and its four wholly-owned subsidiaries: Novapak
Corporation; Novatec Plastics Corporation (inactive); Marpac Industries, Inc.
(inactive); and Airopak Corporation. All inter-company accounts have been
eliminated. While the Company believes the disclosures presented are adequate to
make the information not misleading, these consolidated financial statements
should be read in conjunction with the financial statements and the notes
included in the Company's annual report on Form 10-K for the fiscal year ended
June 30, 2005.

Diluted earnings per share are based on the average number of common shares
outstanding during each period, assuming exercise of all stock options having
exercise prices less than the average market price of the common stock
calculated using the treasury stock method. The weighted average numbers of
shares of common stock used in computing basic and diluted loss per share were
as follows:

<TABLE>
<CAPTION>
                                                                THREE MONTHS ENDED       SIX MONTHS ENDED
                                                                   DECEMBER 31             DECEMBER 31
                                                              ---------------------   ---------------------
                                                                 2005        2004        2005        2004
                                                              ---------   ---------   ---------   ---------
<S>                                                           <C>         <C>         <C>         <C>
Weighted average common shares outstanding used to
   calculate basic income (loss) per share                    7,042,393   7,042,393   7,042,393   7,042,393
Net effect of dilutive securities based upon the treasury
   stock method using an average market price                        --          --          --          --

Weighted average common and dilutive securities outstanding
   used to calculate diluted income (loss) per share          7,042,393   7,042,393   7,042,393   7,042,393
                                                              =========   =========   =========   =========
</TABLE>


                                        6

<PAGE>

The Company has excluded all outstanding stock options because they would have
had an anti-dilutive effect.

Discontinued Operations

In May 2005, the Company entered into a definitive agreement with PolyOne
Corporation ("PolyOne") pursuant to which PolyOne agreed to acquire the Compound
segment's equipment (See Note 7), compounding recipes, and customer
list for $625,000 plus earn-outs payable when certain sales targets are reached
through December 31, 2009.

The agreement also provided that the Company will not compete with the
transferred business for five years after the date of closing of the sale, which
occurred on May 31, 2005. The Company received gross proceeds of $1,125,000
(which included the advance of $500,000 on earn-out payments) and is entitled to
additional earn-out payments of which $58,580 has been applied as of December
31, 2005.

In addition, the Company entered into a supply agreement with PolyOne whereby
the Company will purchase from PolyOne a specified percentage of its
requirements of certain polyvinyl chloride compounds through December 2009 at
predetermined prices. The Company agreed to purchase specific product from
PolyOne as follows:

100% of the Company's requirements through August 31, 2007, then
80% of the Company's requirements through August 31, 2008, then
70% of the Company's requirements through August 31, 2009, then
50% of the Company's requirements through December 31, 2009

The supply agreement may be terminated by either party effective 60 days after
giving written notice, or immediately if there is a material breach or default
of any term or condition of the agreement.

For each pound of product sold by PolyOne to pre-existing customers of the
Company (as defined prior to closing), PolyOne will make earn-out payments to
the Company as follows:

4 cents per pound through August 31, 2007, then
3 cents per pound through August 31, 2008, then
2 cents per pound through August 31, 2009, then
1 cent per pound through December 31, 2009

Royalties will be recognized as earned.

As a result of this disposition, the Compound segment has been reflected on the
Company's financial statements as a discontinued operation for all periods
presented, unless otherwise indicated. Amounts provided in these notes to the
consolidated financial statements may pertain to both continuing and
discontinued operations.

Note 3 Stock-Based Compensation

In December 2004, the Financial Accounting Standards Board ("FASB") issued a
Statement of Financial Accounting Standards ("SFAS") No. 123(R), "Share-Based
Payment" ("Statement 123R"), which requires all companies to measure
compensation cost for all share-based payments (including employee stock


                                        7

<PAGE>

options) at fair value and to recognize cost over the vesting period. In March
2005, the SEC released SEC Staff Accounting Bulletin No. 107, "Share- Based
Payment" ("SAB 107"). SAB 107 provides the SEC staff position regarding the
application of Statement 123R, including interpretive guidance related to the
interaction between Statement 123R and certain SEC rules and regulations, and
provides the staff's views regarding the valuation of share-based payment
arrangements for public companies.

The Company implemented the provisions of Statement 123R and SAB 107 in the
first quarter of fiscal 2006 using the modified-prospective method, and it did
not have a material impact on the Company's financial position or cash flows,
as discussed below."



As of December 31, 2005, the Company had one shareholder-approved stock
incentive plan for employees. The only type of share-based award currently
outstanding under this plan is stock options. More information on stock option
awards is provided below. The Company believes that such awards align the
interests of its employees with those of its stockholders. Certain share-based
awards provide for accelerated vesting if there is a change in control (as
defined under our stock incentive plans). Shares of common stock reserved for
future awards under our stock incentive plans were 199,000 as of December 31,
2005.

The compensation cost related to share-based awards that was charged against
income was $6,940 for the six-months ended December 2005. None of the
compensation cost related to share-based compensation arrangements was
capitalized as part of inventory or fixed assets.

Prior to July 1, 2005, the Company accounted for the share-based compensation
granted under its stock incentive plans under the recognition and measurement
provisions of Accounting Principles Board Opinion No. 25, "Accounting for Stock
Issued to Employees," ("APB 25") and related interpretations. Effective July 1,
2005, the Company implemented the fair value recognition provisions of Statement
123R and SAB 107 for all share-based compensation that was not vested as of June
30, 2005.

In accordance with APB 25, the Company used the intrinsic-value method of
accounting for stock option awards to employees. As a result, the Company did
not recognize compensation expense for stock option awards to employees in its
Consolidated Statement of Operations prior to July 1, 2005, as all option
exercise prices were 100 percent of fair market value on the date the options
were granted.

The following table illustrates the pro forma effect on net income and earnings
per share for the three months and six months ended December 31, 2004, assuming
the Company had applied the fair value recognition provisions of Statement 123R
to all previously granted share-based awards after giving consideration to
potential forfeitures during such quarter. The fair value of each option grant
is estimated at the grant date using the Black-Scholes option-pricing model. The
estimated fair value of options granted is amortized to expense over their
vesting period, which is generally four years.


                                        8

<PAGE>

<TABLE>
<CAPTION>
                                                              Three            Six
                                                              Months          Months
                                                              Ended           Ended
                                                          Dec. 31, 2004   Dec. 31, 2004
                                                          -------------   -------------
<S>                                                       <C>             <C>
Net loss, as reported                                      $(4,941,839)    $(5,838,742)
Add: Share-based employee compensation cost, net of
   related tax, included in net income as reported                  --              --
Deduct: Total share-based employee compensation expense
   determined under fair value based method for
   all awards, net of related tax                               (2,122)         (4,955)
Pro forma net income                                       $(4,943,961)    $(5,843,697)
Net income per common share, as reported
Basic                                                      $      (.70)    $      (.83)
Diluted                                                    $      (.70)    $      (.83)
Pro forma net income per common share
Basic                                                      $      (.70)    $      (.83)
Diluted                                                    $      (.70)    $      (.83)
</TABLE>

The implementation of FAS 123R did not have a material impact on the Company's
cash flow from operations or cash flow from financing activities during the
second quarter of fiscal 2006.

Stock Options

The following information relates to stock options that have been granted under
the Company's stockholder-approved stock incentive plans. Option exercise prices
are 100 percent of fair market value on the date the options are granted.
Options may be exercised for a period set at the time of grant, 10 years after
the date of grant, and become exercisable in installments, 25 percent per year
from the date of grant.

The fair value of each option award is estimated on the date of grant using the
Black-Scholes option-pricing model. No options were granted to employees during
the fiscal quarter ended December 31, 2005.

A summary of stock option activity during the fiscal quarter ended December 31,
2005 is as follows:

<TABLE>
<CAPTION>
                                                                         Weighted-
                                                           Weighted-      Average
                                                            Average      Remaining    Aggregate
                                                            Exercise    Contractual   Intrinsic
                                                  Shares     Price     Term (Years)     Value
                                                 -------   ---------   ------------   ---------
<S>                                              <C>       <C>         <C>            <C>
Stock options outstanding at October 1, 2005     401,000     $4.10
Stock options granted                                 --        --
Stock options exercised                               --        --
Stock options forfeited or expired                    --        --
Stock options outstanding at December 31, 2005   401,000     $4.10          2.8       $(748,970)
Stock options exercisable at December 31, 2005   383,500     $4.19          2.5       $(752,120)
</TABLE>


                                        9

<PAGE>

The status of our nonvested stock options as of December 31, 2005, and changes
during the fiscal quarter then ended is summarized below:

<TABLE>
<CAPTION>
                                                         Weighted-
                                                          Average
                                                        Grant-Date
                                               Shares   Fair Value
                                               ------   ----------
<S>                                            <C>      <C>
Nonvested stock options at October 1, 2005     17,500      $0.80
Stock options granted                              --         --
Stock options vested                               --         --
Nonvested stock options at December 31, 2005   17,500      $0.80
</TABLE>

As of December 31, 2005, there was $1,851 of total unrecognized compensation
cost related to nonvested stock options granted under Company incentive plans.
This cost is expected to be recognized over the remaining vesting period.

In the first two quarters of fiscal 2006, no shares were issued under the terms
of the Company's stock incentive plan.

Note 4 Impact of Recently Issued Accounting Standards

SFAS No. 154

     In June 2005, the FASB issued SFAS No. 154, "Accounting Changes and Error
Corrections, a replacement of APB Opinion No. 20, Accounting Changes, and FASB
Statement No. 3, Reporting Accounting Changes in Interim Financial Statements"
("SFAS 154"). SFAS 154 applies to all voluntary changes in accounting principle,
and changes the requirements for accounting for and reporting of a change in
accounting principle. SFAS 154 requires retrospective application to prior
periods' financial statements of a voluntary change in accounting principle
unless it is impracticable. SFAS 154 requires that a change in method of
depreciation, amortization, or depletion for long-lived, non-financial assets be
accounted for as a change in accounting principle. SFAS 154 is effective for
accounting changes and corrections of errors made in fiscal years beginning
after December 15, 2005. The Company does not believe its adoption of SFAS 154
on July 2, 2006, will have a material impact on its financial statements.


                                       10

<PAGE>

FIN 47

     In March 2005, the FASB issued Interpretation No. 47, "Accounting for
Conditional Asset Requirement Obligations," (FIN 47) which clarifies that the
term "conditional asset retirement obligation" as used in SFAS No. 143,
"Accounting for Asset Retirement Obligations", refers to a legal obligation to
perform an asset retirement activity in which the timing and/or method of
settlement are conditional on a future event that may or may not be within the
control of the entity. However, the obligation to perform asset retirement
activity is unconditional even though there is uncertainty about the timing
and/or method of settlement. FIN 47 requires that the uncertainty about the
timing and/or method of settlement of a conditional asset retirement obligation
be factored into the measurement of the liability when there is sufficient
information. FIN 47 also clarifies when an entity would have sufficient
information to reasonably estimate the fair value of an asset retirement
obligation. FIN 47 is effective fiscal years ending after December 15, 2005. The
Company does not believe the adoption of FIN 47 on July 2, 2006, will have a
material impact on its financial statements.

Note 5 Inventories

Inventories consist of:

<TABLE>
<CAPTION>
                                    DECEMBER        JUNE
                                    31, 2005      30, 2005
                                  -----------   -----------
<S>                               <C>           <C>
Raw materials                     $ 4,316,474   $ 4,962,551
Finished goods                      6,590,661     6,278,161
Reserves                             (970,199)     (822,989)
Total FIFO inventories              9,936,936    10,417,723
Molds for resale, in production       462,388       251,031
Supplies                              631,667       516,550
                                  -----------   -----------
                                  $11,030,991   $11,185,304
                                  ===========   ===========
</TABLE>


                                       11

<PAGE>

Note 6 PNC Bank Agreement and Equipment Financing

The Company entered into a $43,375,000 senior secured credit facility ("PNC Bank
Agreement") with PNC Bank in August 2000. The PNC Bank Agreement was a five
year, $25,000,000 senior revolving credit facility; a five year, $12,183,000
senior term loan; a five year, $4,192,000 standby letter of credit; and a
$2,000,000 capital expenditure line. On November 15, 2004, the PNC Bank
Agreement was amended to extend the maturity of each of these four components
until 2007, and to make specific changes to the credit facilities. The total
senior secured credit facility was reduced to $28,532,000 (which was the
outstanding facility amount at the extension date), consisting of the following:
a senior revolving credit facility of $18,000,000; a senior term loan of
$5,686,000; a standby letter of credit of $3,846,000; and a capital expenditure
line of $1,000,000.

The credit facility contains two financial covenants. The first is a fixed
charge covenant measuring the Company's ability to have adequate cash flow to
cover its annual debt requirements. The second is a net worth covenant. In
September, PNC Bank and the Company amended the financial covenants associated
with the revolving credit facility. At December 31, 2005, the Company was in
compliance with all of the amended covenants. The credit facility is secured by
accounts receivable, inventories, and property, plant and equipment.

The revolving loan bears interest at LIBOR plus 250 basis points, though the
Company entered into interest-rate swap agreements (which expired on October 1,
2005) to effectively convert a portion of the floating debt interest to a fixed
rate. The $1 million capital expenditure line of credit bears interest at LIBOR
plus 300 basis points.

Borrowings under the PNC Bank Agreement totaled approximately $15.9 million at
December 31, 2005. Other debt as of December 31, 2005, in the amount of $6.9
million represents equipment financing with various other institutions.

The effective portion of the gain or loss on a derivative instrument that is
designated and qualifies as a cash flow hedge is reported as a component of
other comprehensive income and reclassified into earnings in the period or
periods during which the hedged transaction affects earnings.

Note 7 Segments

Previously, the Company had two reportable segments: Plastic Containers and
Compound. The Company identified these segments based upon differences in the
types of products each sold. In May 2005, the Company sold the Compound
segment's equipment, compounding recipes, and customer list and, as a result,
operates only in one segment. For more information, see Note 2.

The Plastic Containers segment manufactures custom designed PET, HDPE, and PVC
containers mainly for cosmetics, toiletries, foods, household chemicals, lawn
and garden supplies, and industrial chemical products for sale to customers
located primarily in the United States. The Compound segment manufactured PVC
compound for internal use and for sale. Customers of that segment, who also were
primarily in the United States, used PVC compound for extruded profiles and
accessories, furniture, molding and other indoor fixtures, and molded electrical
and electronic housings.


                                       12

<PAGE>

The reportable segments were managed separately because they used different
manufacturing processes and served different markets. The Company evaluated each
segment's performance based on profit or loss from operations after income
taxes. The accounting policies for the reportable segments were the same as
those for the Company. Intersegment sales and transfers were recorded at market
prices. Information on segments and a reconciliation to a consolidated total are
as follows:

<TABLE>
<CAPTION>
                                                       THREE MONTHS ENDED            SIX MONTHS ENDED
                                                           DECEMBER 31                  DECEMBER 31
                                                    -------------------------    -------------------------
                                                        2005          2004           2005          2004
                                                    -----------   -----------    -----------   -----------
<S>                                                 <C>           <C>            <C>           <C>
Net revenues:
   Plastic containers                               $20,977,683   $19,883,841    $39,453,071   $39,562,001
                                                    -----------   -----------    -----------   -----------
Total consolidated net revenues                     $20,977,683   $19,883,841    $39,453,071   $39,562,001
                                                    ===========   ===========    ===========   ===========
Not included in the above tables as revenues from
   discontinued operations as follows:
   Compound                                         $    (1,604)  $ 4,055,906    $ 1,930,576   $ 9,461,558
   Intersegment revenue - Compound                      (11,488)     (895,819)      (115,547)   (2,314,783)
                                                    -----------   -----------    -----------   -----------
   Revenue from external customers                  $   (13,092)  $ 3,160,087    $ 1,815,029   $ 7,146,775
                                                    ===========   ===========    ===========   ===========
Net income(loss):
   Discontinued operations-Compound                 $    90,276   $   (68,467)   $  (503,063)  $   (37,257)
   Plastic containers                                   993,467    (4,873,372)       817,054    (5,801,485)
                                                    -----------   -----------    -----------   -----------
Total consolidated net income (loss)                $ 1,083,743   $(4,941,839)   $   313,991   $(5,838,742)
                                                    ===========   ===========    ===========   ===========
</TABLE>

<TABLE>
<CAPTION>
                                                                              December 31, 2005   June 30, 2005
                                                                              -----------------   -------------
<S>                                                                              <C>                 <C>
   Assets held for disposition                                                   $        --       $ 1,110,891
   Compound                                                                            4,068         3,576,674
   Plastic containers                                                             47,272,226        48,626,398
                                                                                 -----------       -----------
Total consolidated assets                                                        $47,276,294       $53,313,963
                                                                                 ===========       ===========
</TABLE>

Note 8 Comprehensive Loss

The following table sets forth comprehensive loss for the three-month and
six-month periods ended December 31, 2005, and 2004:

<TABLE>
<CAPTION>
                                  THREE MONTHS ENDED         SIX MONTHS ENDED
                                      DECEMBER 31                DECEMBER 31
                               ------------------------   ----------------------
                                  2005          2004        2005         2004
                               ----------   -----------   --------   -----------
<S>                            <C>          <C>           <C>        <C>
Net income (loss)              $1,083,743   $(4,941,839)   313,991   $(5,838,742)
Unrealized gain (loss) on
   pension obligation, net
   of tax December 31, 2005.      328,216                 (361,354)
Unrealized gains on
   interest rate swap
   December 31, 2004.                            35,661                   61,789
Comprehensive gain
   (loss)                      $1,411,959   $(4,906,178)  $(47,363)  $(5,776,953)
                               ==========   ===========   ========   ===========
</TABLE>


                                       13

<PAGE>

Note 9 Pension

On December 1, 2005, the company froze the pension plan related to its
discontinued Compounding Segment. The termination (which took place in August
2005) results in a plan curtailment under the authoritative literature, SFAS 88.
This curtailment loss has been calculated by the Company's actuary to be an
immaterial amount.

The following table presents the components of net periodic benefit cost for
pension benefits for the three-month period and six-month period ended December
31, 2005:

<TABLE>
<CAPTION>
                                     THREE MONTHS ENDED     SIX MONTHS ENDED
                                         DECEMBER 31          DECEMBER 31
                                    -------------------   -------------------
                                      2005       2004       2005       2004
                                    --------   --------   --------   --------
<S>                                 <C>        <C>        <C>        <C>
Pension benefits
Service cost with interest to the
   end of the quarter               $  1,713   $  2,449   $  4,240   $  4,858
Interest cost                         22,387     15,095     43,247     30,076
Expected return on plan assets       (19,771)   (21,314)   (38,591)   (42,365)
Amortization of transition
   obligation (asset)                    531        761      1,328      1,522
Amortization of prior service
   cost (gain)                           294        422        736        844
Amortization of experience loss        7,969      1,954     15,089      3,908
                                    --------   --------   --------   --------
Net periodic benefits cost          $ 13,123   $   (633)  $ 26,049   $  1,157
                                    ========   ========   ========   ========
</TABLE>

The Company made minimum contributions to its pension plan during the six months
ended December 31, 2005, in the amount of $225,000.

Note 10 Income Taxes

The effective income tax rate for continuing operations changed from a benefit
of 6.1% for the three-month period ended December 31, 2004, to a provision of
40.1% for the three-month period ended December 31, 2005. The effective income
tax rate changed from a benefit of 14.2% for the six-month period ended December
31, 2004, to a provision of 41.0% for the six-month period ended December 31,
2005. The change in the effective tax rate was due to the tax benefit received
through the utilization of net operating losses.

Note 11 Other

In September 2004, the Company entered into a $710,000 severance agreement with
the former Chief Executive Officer; the total amount has been paid pursuant to
the agreement as of September 30, 2005.

During the fourth quarter of fiscal 2005, the Company recorded a charge of
$140,000 related to lifetime medical benefits for its former Chief Executive
Officer and his spouse under the terms of his severance agreement.

The charges relating to lifetime medical benefits and executive severance costs
are reflected in selling, general and administrative expenses. The basis for
this calculation was provided by an independent actuary considering the ages of
the covered individuals, the actuarial life spans, and projected costs of health
insurance premiums.

Liability related to the severance charges for the six-months ended December 31,
2005, was as follows:

<TABLE>
<CAPTION>
                                   Charges to
                                    Costs and
                                   Expenses For   Amount
                   June 30, 2005    Six Months     Paid    Dec. 31, 2005
                   -------------   ------------   ------   -------------
<S>                <C>             <C>            <C>      <C>
Lifetime medical      $140,000          $--         $--       $140,000
                      --------          ---         ---       --------
                      $140,000          $--         $--       $140,000
                      ========          ===         ===       ========
</TABLE>


                                       14

<PAGE>

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

The following discussion provides information and analysis of our results of
operations for the three and six months ended December 31, 2005, and 2004, and
our liquidity and capital resources. This discussion should be read in
conjunction with our consolidated financial statements included elsewhere in
this quarterly report.

OVERVIEW

PVC Container Corporation is a major producer of plastic containers for the
packaging industry. We operate several wholly-owned subsidiaries that
manufacture and sell general line plastic bottles and specialty plastic
containers and supply PVC compounds and specialty plastic alloys in the United
States. Our plastic bottles are sold primarily to manufacturers and distributors
of personal care products, food, household chemicals, and lawn and garden and
industrial chemical products.

Raw Material Costs

The cost of the primary raw materials that the Company uses is directly affected
by the cost of petroleum; increases in the cost of petroleum increase the cost
of the Company's raw materials. Recently, Hurricane Katrina and Hurricane Rita
severely disrupted the petrochemical industry, causing a substantial increase in
the cost of our raw materials. For example, the Company's costs of raw materials
increased approximately 25-50%. The Company has recently been successful in
passing along these price increases to its customers, but if we cannot continue
to do that, the Company's financial results could be adversely affected.
Additionally, in the short term, the substantial cost increases in raw materials
could adversely affect the Company's liquidity.

Reverse Stock Split

The Company's Board of Directors has approved a 1-for-2,000 reverse stock split
as part of a "going-private" transaction. The reverse stock split is expected to
reduce the number of record holders of the Company's common stock below 300 so
the Company will be eligible to terminate the registration of its common stock
under the Securities Exchange Act of 1934 and to cease filing periodic and other
reports with the SEC. Management believes that going private will reduce the
Company's annual selling, general and administrative ("SG&A") expenses
significantly, and also will allow the Company to avoid significant SG&A
expenses because we will not be required to comply with the reporting
requirements of Section 404 of the Sarbanes-Oxley Act.

Completion of the reverse stock split will require approximately $1.1 million,
which includes approximately $480,000 in legal costs and other expenses related
to the transaction. To date, approximately $359,000 of this amount has been
expended. When the reverse stock split becomes effective, stockholders will be
entitled to receive cash in lieu of fractional shares. These payments will
require an additional amount of approximately $620,000 depending on the actual
number of shares repurchased. The Company intends to meet these expenses by
using a portion of the proceeds from the sale of a manufacturing facility at
Eatontown, New Jersey, utilized by the former Compound segment. However, if the
costs of the reverse stock split increase because a higher number of shares are
repurchased than anticipated, the Company intends to use borrowings under its
revolving credit facility and available cash on hand.


                                       15

<PAGE>

CRITICAL ACCOUNTING POLICIES

Several of our accounting policies involve significant judgments and
uncertainties. The following policies have the potential to significantly affect
our results of operations and financial position:

     For impairment analysis, we measure the present value of future cash flows
     against the carrying value of the long-lived asset.

     For accounts receivable, we estimate the net collectibility, considering
     both historical and anticipated trends of trade discounts and allowances
     and the possibility of non-collection due to the financial position of our
     customers.

     For inventory, we estimate the volume of goods that we will not be able to
     sell in the normal course of business and write down the value of those
     goods to the recovery value expected to be realized through off-price
     channels.

     For income tax, we record the estimated future tax effects of differences
     between the tax basis of assets and liabilities and the amount reported in
     the accompanying consolidated balance sheets, as well as operating loss
     carry forwards. We follow very specific guidelines regarding the
     recoverability of any tax assets recorded on the balance sheet and provide
     any necessary allowances as required.

Historically, actual results in these areas have not been materially different
than our estimates, and we do not anticipate that our estimates and assumptions
will materially change in the future. However, if we incorrectly anticipate
trends or unexpected events occur, our results of operations could be materially
affected.

OPERATING PERFORMANCE

In the discussion of the Company's results of operations that follows, the
Company presents EBITDA, which is earnings before interest, taxes, depreciation,
and amortization. The Company believes that the presentation of EBITDA provides
useful information to investors because management uses EBITDA to assess
operating performance. In addition, management believes that EBITDA is a
measurement widely used in the Company's industry, so we provide this
information to allow investors to analyze our performance relative to our
competitors. However, EBITDA is not a financial measure in accordance with
generally accepted accounting principles and should not be considered in
isolation or as a substitute for any measure of performance that is determined
in accordance with generally accepted accounting principles. EBITDA may not be
comparable to similarly titled measures of other companies. The following table
provides a reconciliation from net income (loss) to EBITDA.

<TABLE>
<CAPTION>
                                                      CONTINUING OPERATIONS
                                        ---------------------------------------------------
                                           THREE MONTHS ENDED          SIX MONTHS ENDED
                                               DECEMBER 31                DECEMBER 31
                                        ------------------------   ------------------------
                                           2005          2004         2005          2004
                                        ----------   -----------   ----------   -----------
<S>                                     <C>          <C>           <C>          <C>
Net income (loss) as reported           $  993,467   $(4,873,372)  $  817,054   $(5,801,485)
Add back:
   Provision benefit)for income taxes      665,043      (314,931)     567,803      (960,866)
   Interest Expense(net)                   388,978       429,176      834,587       836,220
   Depreciation & Amortization           1,121,427     1,290,576    2,232,929     2,577,025
                                        ----------   -----------   ----------   -----------
EBITDA                                  $3,168,915   $(3,468,551)  $4,452,373   $(3,349,106)
                                        ==========   ===========   ==========   ===========
</TABLE>


                                       16

<PAGE>

RESULTS OF OPERATIONS

Continuing Operations

Net sales for the three-month period ended December 31, 2005, increased by 5.5%
to $20,978,000, compared to $19,884,000 for the three-month period ended
December 31, 2004. For the six-month period ended December 31, 2005, sales
decreased by 0.3% to $39,453,000, compared to $39,562,000 for the six-month
period ended December 31, 2004. The increase in net sales was primarily due to
higher prices resulting from the pass through of higher resin costs.

Net sales for the six-month period ended December 31, 2005, remained essentially
flat in all sales groups as compared to the same period a year ago.

Cost of goods sold for the three months ended December 31, 2005, was
$16,984,000, or 81.04% of net sales, compared to $16,414,000, or 82.6% of net
sales for the three months ended December 31, 2004. For the six months ended
December 31, 2005, cost of goods sold was $31,972,000, or 81.0% of net sales,
compared to $33,030,000, or 83.5% of net sales, for the same period in 2004. The
decrease in cost of goods sold as a percentage of sales for the three-month
period ended December 31, 2005, compared to the same period a year ago can be
attributed primarily to the Company's enhanced success in passing along the
increase in resin costs to its customers, as well as selected non-resin related
price increases. For the six-month period ended December 31, 2005, cost of goods
was a lower percentage of sales as compared to the same period a year ago,
primarily due to improvements in manufacturing efficiencies and resin cost
pass-through to our customers.

SG&A expenses decreased by $128,000 for the three-month period ended December
31, 2005, and by $909,000 for the six-month period ended December 31, 2005, from
the amounts recorded in the same periods a year ago. For the second quarter
ended December 31, 2005, SG&A expenses were $2,494,000, or 11.9% of net sales,
compared to $2,622,000, or 13.2% of net sales, for the quarter ended December
31, 2004. For the six months ended December 31, 2005, SG&A expenses were
$4,698,000, or 11.9% of net sales, compared to $5,606,000, or 14.2% of net
sales, for the six-month period ended December 31, 2004. This decrease for the
three- and six-month periods was mainly due to a decrease in consulting fees
(which were higher in 2004 arising from work on operational improvements) and
non-recurrence of executive severance and executive recruiting costs.

Depreciation and amortization expenses decreased to $1,121,000 for the
three-month period ended December 31, 2005, compared to $1,291,000 for the
three-month period ended December 31, 2004. For the six-month period ended
December 31, 2005, depreciation and amortization expenses were $2,233,000,
compared to $2,577,000 for the six months ended December 31, 2004. These
reductions in 2005 were due primarily to the full depreciation of certain
manufacturing and computer assets in fiscal 2006.

Income from operations was $378,000, or 1.8% of net sales, for the quarter ended
December 31, 2005, compared to a net loss from operations of $4,761,000, or
23.9% of net sales, for the quarter ended December 31, 2004. For the six-month
period ended December 31, 2005, net income from operations was $550,000, or 1.4%
of net sales, compared to a net loss of $5,969,000 or 15.1% of net sales for the
quarter ended December 31, 2004. In addition to previously discussed factors
this improvement arose mainly because the


                                       17

<PAGE>

Company took several one-time charges during the three- and six-month periods
ended December 31, 2004, for goodwill impairment charges, provision for
restructuring and other exit activities, and asset impairment. The 2005 results
also benefited from the reduced costs and expenses mentioned above.

During fiscal 2005 and the first and second quarters of fiscal 2006, the Company
had assets held for disposition with a recorded value of $1,111,000, consisting
of building and land of the former Compound segment. On October 14, 2005, the
building and land were sold at a contract price of $3,200,000. The net proceeds
of the sale were approximately $2,900,000. This sale generated a gain of
approximately $1,666,000.

EBITDA increased to approximately $3,169,000 for the three-month period ended
December 31, 2005, compared to ($3,469,000) for the three-month period ended
December 31, 2004. For the six-month period ended December 31, 2005, EBITDA
increased to $4,452,000, compared to ($3,349,000) for the six-month period ended
December 31, 2004. The major factor generating this increase was the gain on the
sale of our building and land located at 275 Industrial Way West, Eatontown, New
Jersey. In addition, during the quarter and six-month period ended December 31,
2004, the Company incurred various one-time charges, including goodwill
impairment ($3.2 million), provision for restructuring ($.5 million) and asset
impairment ($.4 million).

Net income for the quarter ended December 31, 2005, was $993,000, or $0.14 on a
diluted earnings per share basis, compared to a net loss of $4,873,000, or $0.69
on a diluted earnings per share basis for the same period a year ago. For the
six-month period ended December 31, 2005, the net loss was $817,000, or $0.17 on
a diluted earnings per share basis, compared to a net loss of $5,801,000, or
$.82 on a diluted earnings per share basis for the six-month period ended
December 31, 2004.

Discontinued Operations

In May 2005, the Company sold the machinery and equipment of the Compound
segment for approximately $625,000, which was $804,000 below book value and
recorded as a pre-tax charge to discontinued operations for asset impairment.
The pre-tax charge to operations for asset impairment was related to the
expected loss on the sale of all of the plastic compound fixed assets -
primarily machinery and equipment located at the Eatontown, New Jersey
manufacturing facility. All manufacturing, production and shipping by our former
Compound segment was discontinued on August 12, 2005, and the business formerly
conducted by the Compound segment has been reflected in the Company's financial
statements as a discontinued operation for all periods presented, unless
otherwise indicated.

Liquidity and Capital Resources

Because we sell plastic containers used in seasonal industries such as lawn and
garden, we have seasonal sales like the rest of the industry. Due to these
seasonal fluctuations, we incur short-term indebtedness to finance working
capital requirements.


                                       18

<PAGE>

The Company's liquidity position and working capital remained adequate for the
six-month period ended December 31, 2005. Net working capital as of December 31,
2005, decreased to $14,814,000 from $19,253,000 as of June 30, 2005, due to
better working capital management. The current ratio of assets to liabilities
decreased from 2.6 at June 30, 2005, to 2.3 as of December 31, 2005, due
primarily to the net decrease in accounts receivable

During the six-month period ended December 31, 2005, the Company generated net
cash from operating activities of $3,626,000 and proceeds from additional
equipment financing of $843,000. These funds were primarily used to acquire
capital assets of $1,242,000, reduce debt under our revolving credit facility by
$1,591,000, and reduce long-term debt by $4,418,000.

Cash provided from inventories, net of reserves, during the six-month period
ended December 31, 2005, was $154,000, compared to a use of funds in the amount
of $2,542,000 in the corresponding period a year ago. We reduced inventories by
initiating various strategic initiatives to enhance scheduling and planning
efficiencies and to improve our purchasing procedures.

Cash provided from prepaid expenses and other current assets during the
six-month period ended December 31, 2005, was $380,000, a significant decrease
from the $1,228,000 use of funds during the corresponding period a year ago.
This decrease was primarily the result of a decline in prepaid federal income
taxes.

Cash used for accounts payable and other accrued expenses during the six-month
period ended December 31, 2005, was $1,046,000, compared to a provision of funds
in the amount of $268,000 for the six-month period ended December 31, 2004. The
primary contributing factors for this use of funds was the ability to meet our
commitments with new outside raw material vendors.

Cash used to reduce our revolving credit line was $1,591,000 during the
six-month period ended December 31, 2005, compared to $2,415,000 of cash during
the six-month period ended December 31, 2004. Also, the Company reduced
long-term indebtedness by $2,482,000.

Our short-term liquidity and short-term capital resources are projected to be
adequate to allow the Company to continue to meet financial obligations.
Management believes the financial resources available to the Company, including
internally generated funds and borrowings under our revolving credit facility,
will be sufficient to meet foreseeable working capital requirements. At December
31, 2005, we had unused sources of liquidity consisting of cash and cash
equivalents of $373,900 and unused credit under a revolving credit facility of
$5,076,000.

Our revolving credit facility includes financial and other covenants, including
a minimum equity covenant and a fixed charge coverage covenant. In November
2004, the Company extended the maturity date of the PNC Bank Agreement until
2007. The terms and conditions are substantially the same as the original
agreement, although the total amount of the facility was reduced. In September
2005, our revolving credit facility was renegotiated to amend the fixed charge
coverage and equity covenants to be more aligned with the anticipated
operational performance of the Company. As of December 31, 2005, the total
senior secured credit facility was approximately $28,500,000, and we were in
compliance with all applicable covenants.


                                       19

<PAGE>

We utilize revolving loan facilities for seasonal working capital needs and for
other general corporate purposes. We can use amounts available under revolving
loan facilities in excess of seasonal working capital needs to pursue our growth
strategy, particularly in PET product lines, and for other permitted purposes.

There were no material changes during the six months ended December 31, 2005, in
the contractual obligations presented in the consolidated financial statements
in our annual report on Form 10-K for the fiscal year ended June 30, 2005, other
than the changes in the PNC Bank Agreement discussed above.

The effective portion of the gain or loss on a derivative instrument (which
expired on December 31, 2005) that is designated and qualifies as a cash flow
hedge is reported as a component of other comprehensive income and reclassified
into earnings in the period or periods during which the hedged transaction
affects earnings.

Off-Balance Sheet Arrangements

There are no material off-balance sheet arrangements that have or are reasonably
likely to have a current or future effect on our financial condition.

STATEMENT REGARDING FORWARD-LOOKING DISCLOSURE

Certain statements in this report are "forward-looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking
statements give current expectations or forecasts of future events and are not
guarantees of future performance. They are based on management's expectations,
and involve a number of business risks and uncertainties, any one of which could
cause actual results to differ materially from those expressed in or implied by
the forward-looking statements.

Forward-looking statements do not relate strictly to historic or current facts.
They use words such as "anticipate," "estimate," "expect," "project," "intend,"
"plan," "believe," and other words and terms of similar meaning in connection
with any discussion of future operating or financial performance. In particular,
these include statements relating to future actions; prospective changes in raw
material costs, product pricing, or product demand; future performance or
results of current and anticipated market conditions and market strategies;
sales efforts; and financial results.

There are risks and uncertainties that may cause results to differ materially
from those set forth in the Company's forward-looking statements. It is not
possible to predict or identify all risk factors, but factors that could cause
such results to differ materially include changes in U.S., regional, or world
polymer growth rates affecting the Company's markets; changes in global industry
capacity or in the rate at which anticipated changes in capacity are realized in
the polyvinyl chloride or other industries in which the Company participates;
fluctuations in raw material prices, quality, and supply and in energy prices
and supply, particularly fluctuations outside the normal range of industry
cycles, including as a result of Hurricane Katrina and Hurricane Rita; an
inability (for competitive reasons) to raise prices or sustain price increases
for products; and an inability to access the Company's revolving credit
facility.


                                       20

<PAGE>

The Company cannot guarantee that any forward-looking statement will be
realized, although management believes its plans and assumptions are prudent.
Should known or unknown risks or uncertainties materialize, or should the
assumptions underlying a forward-looking statement prove inaccurate, actual
results could vary materially from those anticipated, estimated, or projected.

The Company undertakes no obligation to publicly update forward-looking
statements, whether as a result of new information, future events, or otherwise.
Investors should consult any further disclosures the Company makes on related
subjects in its filings with the SEC.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Most of the Company's market risk arises from changes in interest rates. We use
interest rate pricing transactions only to the extent considered necessary to
meet our objectives. We do not utilize derivative financial instruments for
trading or other speculative purposes.

Our interest rate risk management objective is to limit the impact of interest
rate changes on net income and cash flow and to reduce our overall borrowing
cost. We use variable rate swap agreements to manage our exposure to interest
rate fluctuations. These agreements effectively convert variable interest rates
to fixed rates, enabling management to predict interest expense and to avoid the
risk of dramatic rate fluctuations.

As of December 31, 2005, the Company had total outstanding indebtedness of
$28,895,000. Of this amount, approximately $22,295,000 was subject to variable
interest rates. Based on the Company's December 31, 2005, variable debt level, a
25 basis point increase or decrease in interest rates would have had a $13,935
impact on interest expense for the quarter ended December 31, 2005.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of management, including the
Company's principal executive officer and principal financial officer, the
Company has evaluated the effectiveness of its disclosure controls and
procedures, as defined in Rule 13a-15(e) and Rule 15d-15(e) under the Securities
Exchange Act of 1934. Based upon that evaluation, the Company's principal
executive officer and principal financial officer have concluded that, as of the
end of the period covered by this Quarterly Report, our disclosure controls and
procedures were effective.

There were no changes to the Company's internal control over financial reporting
during the period covered by this Quarterly Report that have materially
affected, or are reasonably likely to materially affect, the Company's internal
control over financial reporting.


                                       21

<PAGE>

PART II OTHER INFORMATION

Item 1. Legal Proceedings

There are no actions or claims pending against the Company, which, in the
opinion of management, would adversely affect the financial position, results of
operations or cash flows of the Company.

Item 6. Exhibits

31.1 Certification of William J. Bergen, President, Chief Executive Officer,
Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2 Certification of Jeffrey A. Shapiro, Senior Vice President, Chief Financial
Officer, Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32 Certification of William J. Bergen, Chief Executive Officer, and Jeffrey
Shapiro, Chief Financial Officer, Pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002

                                   Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

Date: February 14, 2006                 PVC Container Corporation


                                        /s/ William J. Bergen
                                        ----------------------------------------
                                        William J. Bergen
                                        President and Chief Executive Officer


Date: February 14, 2006                 PVC Container Corporation


                                        /s/ Jeffrey Shapiro
                                        ----------------------------------------
                                        Jeffrey Shapiro
                                        Chief Financial Officer


                                       22

<PAGE>

                                  Exhibit Index

31.1 Certification of William J. Bergen, President, Chief Executive Officer,
     Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2 Certification of Jeffrey A. Shapiro, Senior Vice President, Chief Financial
     Officer, Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32   Certification of William J. Bergen, Chief Executive Officer, and Jeffrey A.
     Shapiro, Chief Financial Officer, Pursuant to Section 906 of the
     Sarbanes-Oxley Act of 2002.


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