<PAGE>   1


                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                    FORM 10-Q

(Mark One)

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

                  For the quarterly period ended: June 30, 1999

                                       OR

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

        For the transition period from: ______________ to _______________

                         Commission file number: 0-24464

                                THE CRONOS GROUP

             (Exact name of Registrant as specified in its charter)

               LUXEMBOURG                            NOT APPLICABLE
      (State or other Jurisdiction                   (I.R.S Employer
    of incorporation or organization)              Identification No.)

             16, ALLEE MARCONI, BOITE POSTALE 260, L-2120 LUXEMBOURG

               (Address of principal executive offices)(zip code)

              Registrant's telephone number, including area codes:
                                  (352) 453145

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

        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 [ ]

          THE NUMBER OF COMMON SHARES OUTSTANDING AS OF AUGUST 2, 1999:

                  CLASS                       NUMBER OF SHARES OUTSTANDING
                  -----                       ----------------------------
                 Common                                 9,158,378



<PAGE>   2

                                THE CRONOS GROUP

                                TABLE OF CONTENTS


                                THE CRONOS GROUP

                          PART I--FINANCIAL INFORMATION

<TABLE>
<S>                                                                            <C>
Item 1 -- Financial Statements..................................................1

  Management Representation.....................................................1
  Consolidated Statements of Income.............................................2
  Consolidated Balance Sheets...................................................3
  Consolidated Statements of Cash Flows.........................................4
  Consolidated Statements of Shareholders' Equity...............................5
  Notes to the Consolidated Financial Statements................................6

Item 2 -- Management's Discussion and Analysis of Financial
          Condition and Results of Operations...................................9

  General.......................................................................9
  Three Months Ended June 30, 1999 Compared to
          Three Months Ended June 30, 1998.....................................10
  Six Months Ended June 30, 1999 Compared to
          Six Months Ended June 30, 1998.......................................11
  Liquidity and Capital Resources..............................................12

Item 3 -- Quantitative and Qualitative Disclosures about Market Risk...........14

                        PART II --OTHER INFORMATION

Item 1 -- Legal Proceedings....................................................15
Item 5 -- Other Information....................................................16
Item 6 -- Exhibits and Reports on Form 8-K.....................................16
</TABLE>



<PAGE>   3

                                THE CRONOS GROUP

                          PART I--FINANCIAL INFORMATION

ITEM 1 -- FINANCIAL STATEMENTS

        MANAGEMENT REPRESENTATION

        The interim financial statements included herein have been prepared by
the Company, without audit, pursuant to the rules and regulations of the
Securities and Exchange Commission. Certain information and disclosures normally
included in financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to such rules and
regulations. The Company believes, however, that the disclosures are adequate to
make the information presented not misleading.

        These financial statements should be read in conjunction with the
financial statements and the notes thereto included in the Company's latest
Annual Report on Form 10-K.

        This financial information reflects, in the opinion of management, all
adjustments necessary to present fairly, the results for the interim periods.
Such adjustments consist of only normal recurring adjustments. The results of
operations for such interim periods are not necessarily indicative of the
results to be expected for the full year.



                                                                               1
<PAGE>   4

                                THE CRONOS GROUP

                        CONSOLIDATED STATEMENTS OF INCOME

           (US dollar amounts in thousands, except per share amounts)
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                          Three Months Ended                       Six Months Ended
                                                                June 30,                               June 30,
                                                    -------------------------------         -------------------------------
                                                       1999                1998                1999                1998
                                                    -----------         -----------         -----------         -----------
<S>                                                 <C>                 <C>                 <C>                 <C>
GROSS LEASE REVENUE                                 $    32,082         $    40,042         $    66,832         $    80,568
Commissions, fees and other income                        1,664               1,573               3,288               3,187
                                                    -----------         -----------         -----------         -----------
TOTAL REVENUES                                           33,746              41,615              70,120              83,755
                                                    -----------         -----------         -----------         -----------

Direct operating expenses                                 7,799               8,504              15,863              17,215
Payments to container owners                             15,101              19,615              31,773              39,081
Depreciation and amortization                             3,987               4,821               8,385               9,452
Selling, general and administrative expenses              4,013               5,871               8,139              11,226
Financing and recomposition expenses                         --                 242                  --                 484
Interest expense                                          2,949               4,047               6,156               8,290
                                                    -----------         -----------         -----------         -----------
TOTAL EXPENSES                                           33,849              43,100              70,316              85,748
                                                    -----------         -----------         -----------         -----------
LOSS BEFORE INCOME TAXES                                   (103)             (1,485)               (196)             (1,993)
Income taxes                                                 --                  68                  --                 235
                                                    -----------         -----------         -----------         -----------
NET LOSS                                                   (103)             (1,553)               (196)             (2,228)
                                                    ===========         ===========         ===========         ===========
LOSS PER COMMON SHARE (BASIC AND DILUTED)           $     (0.01)        $     (0.17)        $     (0.02)        $     (0.25)
                                                    ===========         ===========         ===========         ===========
BASIC AND DILUTED SHARES OUTSTANDING                  8,858,378           8,858,378           8,858,378           8,858,378
</TABLE>



The accompanying notes are an integral part of these consolidated financial
statements.



                                                                               2
<PAGE>   5

                                THE CRONOS GROUP

                           CONSOLIDATED BALANCE SHEETS

           (US dollar amounts in thousands, except per share amounts)

<TABLE>
<CAPTION>
                                                   June 30,        December 31,
                                                     1999              1998
                                                  ---------        ------------
                                                 (Unaudited)
<S>                                               <C>               <C>
ASSETS

Cash and cash equivalents                         $   5,566         $   9,281
Amounts due from lessees, net                        29,062            33,215
Net investment in direct finance leases               1,577             3,504
Container equipment, net                            143,312           168,558
Property and investments, net                        29,160            32,323
Amounts receivable from related parties                 225             5,500
Other                                                25,205            27,598
                                                  ---------         ---------
TOTAL ASSETS                                      $ 234,107         $ 279,979
                                                  =========         =========

LIABILITIES AND SHAREHOLDERS' EQUITY

Amounts payable to container owners               $  25,643         $  31,314
Debt and capital lease obligations                  114,494           148,466
Current and deferred income taxes                     7,696             8,085
Other liabilities                                    30,383            36,027
                                                  ---------         ---------
TOTAL LIABILITIES                                   178,216           223,892
                                                  ---------         ---------

SHAREHOLDERS' EQUITY

Common shares                                        17,717            17,717
Additional paid-in capital                           49,077            49,108
Share subscriptions receivable                          (92)             (123)
Retained earnings                                   (10,811)          (10,615)
                                                  ---------         ---------
TOTAL SHAREHOLDERS' EQUITY                           55,891            56,087
                                                  ---------         ---------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY        $ 234,107         $ 279,979
                                                  =========         =========
</TABLE>

The accompanying notes are an integral part of these consolidated financial
statements.



                                                                               3
<PAGE>   6

                                THE CRONOS GROUP

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

           (US dollar amounts in thousands, except per share amounts)

                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                 Six Months Ended
                                                                     June 30,
                                                             -------------------------
                                                               1999             1998
                                                             --------         --------
<S>                                                          <C>              <C>
NET CASH PROVIDED BY OPERATING ACTIVITIES                    $ 12,047         $  8,690
                                                             --------         --------
INVESTING ACTIVITIES:

Purchase of container and other equipment                        (267)          (2,363)
Proceeds from sales of container and other equipment           19,416              901
                                                             --------         --------
NET CASH (USED) PROVIDED FOR INVESTING ACTIVITIES              19,149           (1,462)
                                                             --------         --------

FINANCING ACTIVITIES:

Proceeds from issuance of term debt                                --            1,889
Repayments of term debt and capital lease obligations         (34,911)          (9,880)
                                                             --------         --------
NET CASH USED BY FINANCING ACTIVITIES                         (34,911)          (7,991)
                                                             --------         --------
NET DECREASE IN CASH AND CASH EQUIVALENTS                      (3,715)            (763)

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD                9,281           14,455
                                                             --------         --------
CASH AND CASH EQUIVALENTS AT END OF PERIOD                   $  5,566         $ 13,692
                                                             ========         ========

Supplementary disclosure of cash flow information:

Cash paid during the period for:

- interest                                                   $  6,345         $  9,884
- income taxes                                                    257               82
Cash received during the period for:

- interest                                                        267            1,678
- income taxes                                                     --               --
Non-cash investing and financing activities:

- container equipment acquired under capital lease                 --               --
- container equipment acquired but unpaid at June 30               --               --
</TABLE>



The accompanying notes are an integral part of these consolidated financial
statements.



                                                                               4
<PAGE>   7

                                THE CRONOS GROUP

                 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

                     Six Months Ended June 30, 1998 and 1999
          (U.S. dollar amounts in thousands, except per share amounts)

                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                    Accumulated
                                                    Additional            Share            other        Retained            Total
                                        Common         paid-in    subscriptions    comprehensive        earnings    shareholders'
                                        shares         capital       receivable           income    unrestricted           equity
                                      --------      ----------    -------------    -------------    ------------    -------------
<S>                                   <C>             <C>              <C>              <C>             <C>              <C>
SIX MONTHS ENDED JUNE 30, 1998

Balance, December 31, 1997            $ 17,717        $ 49,154         $   (169)        $  1,159        $  5,852         $ 73,713
MEIP lapses                                 --              --               --               --              --               --
Net loss                                    --              --               --               --          (2,228)          (2,228)
                                      --------        --------         --------         --------        --------         --------
Balance, June 30, 1998                $ 17,717        $ 49,154         $   (169)        $  1,159        $  3,624         $ 71,485
                                      ========        ========         ========         ========        ========         ========

SIX MONTHS ENDED JUNE 30, 1999

Balance, December 31, 1998            $ 17,717        $ 49,108         $   (123)        $     --        $(10,615)        $ 56,087
MEIP lapses                                 --             (31)              31               --              --               --
Net loss                                    --              --               --               --            (196)            (196)
                                      --------        --------         --------         --------        --------         --------
Balance, June 30, 1999                $ 17,717        $ 49,077         $    (92)        $     --        $(10,811)        $ 55,891
                                      ========        ========         ========         ========        ========         ========
</TABLE>



The accompanying notes are an integral part of these consolidated financial
statements.



                                                                               5
<PAGE>   8

                                THE CRONOS GROUP

                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

          (U.S. dollar amounts in thousands, except per share amounts)

1.      The consolidated financial statements include the accounts of The Cronos
        Group and its wholly-owned subsidiaries (the "Company"). All material
        intercompany accounts and transactions have been eliminated.

2.      Operating segment data

Condensed segment information is provided in the tables below:

<TABLE>
<CAPTION>
                                                                 Other
                                             US Limited        container          Owned
                                            Partnerships         owners         containers           Total
                                            ------------       ---------        ----------         ---------
<S>                                           <C>              <C>               <C>               <C>
Three months ended June 30, 1998
Gross lease revenue                           $  14,062        $  15,750         $  10,230         $  40,042
Operating profit before indirect items            2,780            1,743               455             4,978
Operating profit                                    663             (366)             (915)             (618)
Segment assets                                   24,363           23,841           199,682           247,886

Three months ended June 30, 1999
Gross lease revenue                           $  10,738        $  13,538         $   7,806         $  32,082
Operating profit before indirect items            2,155            1,492               762             4,409
Operating profit                                    609               39              (167)              481
Segment assets                                   21,334           19,939           155,159           196,432

Six months ended June 30, 1998
Gross lease revenue                           $  28,489        $  31,594         $  20,485         $  80,568
Operating profit before indirect items            5,740            4,082               702            10,524
Operating profit                                  1,414              130            (1,844)             (300)
Segment assets                                   24,363           23,841           199,682           247,886

Six months ended June 30, 1999
Gross lease revenue                           $  22,533        $  27,778         $  16,521         $  66,832
Operating profit before indirect items            4,521            3,102             1,304             8,927
Operating profit                                  1,380              182              (578)              984
Segment assets                                   21,334           19,939           155,159           196,432
</TABLE>


Reconciliation of operating profit for reportable segments to earnings before
taxes:

<TABLE>
<CAPTION>
                                                       Three Months Ended              Six Months Ended
                                                            June 30,                       June 30,
                                                    -----------------------         -----------------------
                                                      1999            1998            1999            1998
                                                    -------         -------         -------         -------
<S>                                                 <C>             <C>             <C>             <C>
Operating profit                                    $   481         $  (618)        $   984         $  (300)
Selling, general and administrative expenses           (414)           (468)           (839)           (913)
Amortization of intangibles                            (170)           (157)           (341)           (296)
Financing and recomposition expenses                     --            (242)             --            (484)
                                                    -------         -------         -------         -------
Loss before income taxes                            $  (103)        $(1,485)        $  (196)        $(1,993)
                                                    =======         =======         =======         =======
</TABLE>



                                                                               6
<PAGE>   9

                                THE CRONOS GROUP

3.      Container equipment

        Container equipment is net of accumulated depreciation of $59,863 and
$59,640 at June 30, 1999 and December 31, 1998, respectively.

4.      Amounts payable to container owners

        Amounts payable to container owners include amounts payable to related
parties of $11,942 and $13,287 at June 30, 1999 and December 31, 1998,
respectively.

5.      Debt and capital lease obligations

        Debt and capital lease obligations include amounts due within twelve
months of $59,477 and $87,271 at June 30, 1999 and December 31, 1998,
respectively. On August 2, 1999, the Company successfully closed a $50.0 million
re-financing transaction, the proceeds of which were used to refinance all of
the Company's debt scheduled to mature in the next six months. See also
"Liquidity and Capital Resources-Capital Resources".

6.      Commitments and contingencies (to be read in conjunction with Note 21 to
        the 1998 Consolidated Financial Statements)

i.      Commitments

        At June 30, 1999, the Company had commitments under operating leases for
office space and equipment that were not material.

        The Company had no outstanding orders in respect of container equipment
at June 30, 1999.

ii.     Contingencies --- Austrian allegations

        Since 1983, as described in the Company's prospectus dated December 7,
1995, a subsidiary company has managed containers for Austrian investment
entities, including limited and unlimited partnerships and companies, sponsored
by companies owned by Contrin Holding S.A., a Luxembourg holding company
("Contrin"), and for that company itself. Mr. S M Palatin, a former Chairman of
the Board of Directors and former Chief Executive Officer, has been a director
of Contrin. During 1994, ownership of the companies sponsoring these entities
was transferred by Contrin to Barton Holding Ltd, a Bahamian company, which has
owned preferred shares in the Company ("the former preferred shareholder"). See
Note 21 to the 1998 Consolidated Financial Statements for further details
regarding Barton Holding Ltd ("Barton") and transactions involving that company.

        Some participants in a number of the aforementioned Austrian investment
entities have made allegations to the Company and Austrian government
authorities regarding the conduct of the investment entities, the sponsoring
companies and companies alleged to be connected to Mr. Palatin and regarding Mr.
Palatin himself.

        Firstly, it is alleged, broadly, that not all container management
income due to participants in these investment entities ("third parties") has
been received by them.

        In this connection, in September 1997 the Company transferred $360 in
Contrin distributions to a bank account pursuant to instructions that may have
been falsified. The Austrian courts took control of the account and on June 8,
1999 authorized release of the monies to the originally intended Contrin
entities. The Company believes it has no further liability regarding this
matter. A further $118 deposited by the Company



                                                                               7
<PAGE>   10

                                THE CRONOS GROUP

in an Austrian bank account also supervised by the Austrian Courts, representing
distributions due to certain Contrin entities, was released by the courts to
those entities in November 1998.

        Moreover, Austrian courts have initiated investigations against Mr.
Palatin and additional persons, including Mr. R J Weissenberger, a former
Chairman and director, and Mr. A Friedberg, a former director. Mr. Palatin and
Mr. Friedberg have since been formally charged. Such investigations have not
resulted in any actions being taken against Mr. Weissenberger and he has
informed the Company that he does not believe that there is any valid basis for
any such actions to be taken against him.

        Management has been unable to obtain definitive information regarding
the relationships suggested in the allegations by the third parties.

        Secondly, it is alleged that funds may have been remitted to the
Company, which were not deposited in a Company bank account and are not
reflected in the Company's accounting records. Specifically, it is alleged that
Mr. Palatin acknowledged receipt of funds in the amount of $2,600 during the
year ended December 31, 1995, yet it appears that these funds were received into
a non-Company bank during the year ended December 31, 1994. Previous to these
allegations, the Company's current management was not aware of the receipt of
the $2,600, nor was it aware of Mr. Palatin's acknowledgement. The Company has
determined that a $400 distribution to third party investors was paid by the
Company in December 1994, into the same bank account into which the $2,600 was
apparently deposited. Management is investigating these allegations and is
continuing to seek definitive information regarding the non-Company bank account
and the receipt and disbursement of the $2,600.

        Thirdly, claims relate to alleged transactions between third parties and
companies alleged to be connected to Mr. Palatin, involving the purchase and
sale of containers in a manner designed to secure a tax mitigation advantage to
those third parties. It is alleged that sums remain owing to the third parties
by one or more of these companies in connection with the pre-arranged trading in
containers. It is the view of management that the Company was not involved in
these transactions, that the Company has no access to the records of the alleged
transactions and, so far as the Company has managed the containers, the Company
has acted in accordance with instructions from authorised representatives of the
third parties. Management has been unable to quantify the extent, if any, that
the Company might be held to be liable should the claims prove to be
substantiable. The mechanisms, if any, and jurisdictions for initiation of any
claims are also unclear.

        Certain of the companies which have sponsored Austrian investment
entities have, under the terms of the relevant management agreement, arranged
for examination of Company records pertaining to the management of containers
owned by those investment entities. Some inquiries were made by representatives
of the third parties. Management is not aware of any unresolved issues in this
respect.

        In response to the actions taken by Contrin, the Company terminated
certain of its management agreements with Contrin entities in 1998. Discussions
are taking place between Contrin and the Company and it is anticipated that
these agreements will be reinstated.

        Management considers that prudent provision has been made in the
financial statements for the matters in this connection. There is a reasonable
possibility that a material change could occur in respect of commitments and
contingencies within one year of the date of these financial statements. Details
of the provision are provided in Notes 1r and 3 to the 1998 Consolidated
Financial Statements.

iii.    Contingencies --- Arbitration

        Under the terms of the relevant management agreement, an arbitration
process was commenced on or around February 1997 by one of the companies that
had sponsored Austrian entities in respect of distributions made by the Company
through its Austrian attorney. In December 1998, the arbitration panel found
that the management agreements with the Austrian investment entities were valid.
The Company has made provision for anticipated legal expenses arising from the
arbitration.

See also Note 14 to the 1998 Consolidated Financial Statements.



                                                                               8
<PAGE>   11

                                THE CRONOS GROUP

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

        GENERAL

        The Company generates revenues by leasing to ocean carriers marine
containers that are owned either by third-party container owners or by the
Company itself. These leases, which generate most of the Company's revenues, are
generally operating leases.

        The following chart summarizes the composition of the Cronos fleet
(based on original equipment cost) at June 30 for each of the periods indicated:

<TABLE>
<CAPTION>
                                               1999                     1998
                                               ----                     ----
<S>                                             <C>                      <C>
U.S. Public Limited Partnerships                 34%                      35%
Other Container Owners                           43%                      40%
Owned Containers                                 23%                      25%
                                               ----                     ----
     Total                                      100%                     100%
                                               ====                     ====
</TABLE>

        All containers, whether owned or managed, are operated as part of a
single fleet. The Company has discretion over which ocean carriers, container
manufacturers and suppliers of goods and services it deals with. Since the
Company's management agreements with the Managed Container Owners meet the
definition of leases in Statement of Financial Accounting Standards No. 13, they
are accounted for in the Company's financial statements as leases under which
the container owners are lessors and the Company is lessee. The agreements with
container owners generally provide that the Company will make payments to the
container owners based upon the rentals collected from ocean carriers after
deducting direct operating expenses and a management fee. The majority of
payments to container owners are therefore contingent upon the leasing of the
containers by the Company to ocean carriers and the collection of lease rentals.
Minimum lease payments on the minority of agreements that have fixed payment
terms are presented in Note 14(c) to the 1998 Consolidated Financial Statements.
The majority of payments to container owners represent a percentage of the
rentals collected from the ocean carriers to whom containers are leased by the
Company.

        The following chart summarizes the composition of the Cronos fleet
(based on TEU thousands), by equipment type, at June 30 for each of the periods
indicated:

<TABLE>
<CAPTION>
Equipment Type                                                  1999               1998
--------------                                                  -----              -----
<S>                                                             <C>                <C>
Dry cargo                                                       333.4              342.3
Refrigerated                                                     14.2               15.1
Tank                                                              2.0                2.0
Roll-Trailer                                                      2.1                2.3
Cellular palletwide containers ("CPCs")                           2.4                2.4
Other dry freight specials                                        2.5                1.8
                                                                -----              -----
     Total fleet                                                356.6              365.9
                                                                =====              =====
</TABLE>

        In recent months, economic reforms in Asia, as well as in Latin America,
have begun to produce gradual improvement in terms of world trade, and there are
preliminary indications that containerized trade volumes from North America and
Europe to Asia, in particular, may be increasing. Intra-Asian trade, which also
had stagnated since the Asia financial crisis began nearly two years ago, has
shown increased activity in



                                                                               9
<PAGE>   12

                                THE CRONOS GROUP

recent months. These favorable signs, however, have yet to produce any
significant positive impact on the Company's operating performance. In spite of
the reduced redelivery of on-hire equipment by the ocean carriers, per-diem
rental rates have continued to decline as a result of competitive market
conditions and high inventories.

        The Company continues to take advantage of its marketing resources in
order to seek out leasing opportunities during this period. The short-term
objective is to improve utilization by offering greater leasing incentives and
actively repositioning equipment to higher-demand locations. While this
short-term strategy will increase repositioning expenses, it may also minimize
those expenses related to storing off-hire containers. These measures will also
provide the longer-term advantage of placing the containers where the demand is
greatest.

        The following chart summarizes the combined utilization of the Cronos
fleet (based on approximate original equipment cost) at the dates indicated:

<TABLE>
<CAPTION>
                    July 31     June 30      March 31     June 30
                     1999         1999         1999         1998
                    -------     -------      --------     -------
<S>                  <C>          <C>          <C>          <C>
Utilization          75.7%        75.2%        72.6%        80.4%
</TABLE>


        During the first six months of 1999, the Company made significant
reductions to selling, general and administrative expenses in line with a
restructuring program that was announced in late 1998. This program, which has
now been substantially completed, involved the reorganization of key activities
together with the termination of certain employee positions. In addition, the
Company reduced its short-term debt by $20.6 million in accordance with its
strategy to refinance certain short-term debt obligations and thereby reduce the
cost of debt financing. Through June 30, 1999, this strategy has resulted in the
sale by Cronos of $36.6 million of container equipment, at Cronos' original
equipment cost, to various third party investor programs. On August 2, 1999, the
Company successfully closed a $50.0 million re-financing transaction, the
proceeds of which were used to refinance all of the Company's debt scheduled to
mature in the next six months. See also "Liquidity and Capital Resources-Capital
Resources".

        THREE MONTHS ENDED JUNE 30, 1999 COMPARED TO THREE MONTHS ENDED JUNE 30,
        1998

        Operating profit for the three months ended June 30, 1999 was $0.5
million compared to a loss of $0.6 million during the corresponding period of
1998. Reductions in selling, general and administrative expenses, interest
expense and depreciation expense more than offset reduced income from both the
owned and managed container fleets.

        Gross lease revenue of $32.1 million in the three months ended June 30,
1999 was $8.0 million, or 19.9% lower than in the corresponding period of 1998.
This decline can be attributed to the combined effect of reduced utilization,
lower per diem rates and a smaller fleet size representing approximately $3.7
million, $3.3 million and $1.0 million of the reduction respectively.

        Commissions, fees and other income of $1.7 million in the three months
ended June 30, 1999 were almost unchanged from the corresponding period in 1998.
Increased income, primarily from specialized container products, was partially
offset by reduced fees from the disposal of containers and lower finance lease
income.

        Direct operating expenses were $7.8 million in the three months to June
30, 1999, a decrease of $0.7 million, or 8.3%, compared to the corresponding
period in 1998. Increased storage, reflecting a larger off-hire fleet, was more
than offset by reductions in charges for doubtful accounts, repairs,
repositioning and handling.



                                                                              10
<PAGE>   13

                                THE CRONOS GROUP

        Payments to container owners amounted to $15.1 million during the three
months ended June 30, 1999, a decrease of $4.5 million or 23.0%, when compared
to the corresponding period in 1998.

        Payments to U.S. Limited Partnerships amounted to $5.7 million, a
decline of $2.9 million or 33.9%, when compared to the corresponding period in
1998. Lower average utilization and per-diem rates, as well as a smaller
container fleet caused the decline in net lease revenue for this segment. The
U.S. Limited Partnership fleet declined from 135,517 TEU at June 30, 1998, to
126,620 TEU at June 30, 1999 as a result of the disposal of older container
equipment.

        Payments to Other Container Owners were $9.4 million during the three
months ended June 30, 1999, a decrease of $1.6 million, or 14.4%, when compared
to the corresponding period of 1998 as lower average utilization and per-diem
rates more than offset a larger average fleet size. The increase in the average
fleet size was due to transactions involving the sale of equipment from the
Owned to the Other Container Owners segment.

        Depreciation and amortization decreased by $0.8 million, or 17.3%, in
the three months to June 30, 1999, to $4.0 million due to container sales from
the Owned to the Other Container Owners segment.

        Selling, general and administrative expenses decreased to $4.0 million
for the three months ended June 30, 1999 from $5.9 million for the three months
ended June 30, 1998, a decrease of $1.9 million or 31.6%. The decrease was due
primarily to a $1.0 million reduction in manpower and manpower-related costs,
together with lower costs related to information technology, professional
services and communications.

        Interest expense of $2.9 million for the three months ended June 30,
1999 declined $1.1 million or 27.1%, when compared to the corresponding period
in 1998. This decrease is due primarily to a reduction in the average debt
balance from $163.8 million to $122.1 million between the second quarters of
1998 and 1999, respectively.

        SIX MONTHS ENDED JUNE 30, 1999 COMPARED TO SIX MONTHS ENDED JUNE 30,
        1998

        Operating profit of $1.0 million for the six months to June 30, 1999 was
$1.3 million higher than the $0.3 million loss for the corresponding period in
1998. Reductions in selling, general and administrative expenses, interest
expense and depreciation expense more than offset reduced income from both the
owned and managed container fleets.

        Gross lease revenue of $66.8 million in the six months to June 30, 1999
was $13.7 million, or 17.1%, lower than in the corresponding period in 1998.
This decline can be attributed to the combined effect of reduced utilization,
lower per diem rates and a smaller fleet size representing approximately $7.1
million, $4.7 million and $1.9 million of the reduction respectively.

        Commissions, fees and other income of $3.3 million during the six months
ended June 30, 1999 were almost unchanged from the corresponding period in 1998.
Increased income, primarily from specialized container products, was partially
offset by reduced fees from the disposal of containers and lower finance lease
income.

        Direct operating expenses were $15.9 million during the six months ended
June 30, 1999, a decrease of $1.4 million, or 7.9%, compared to the
corresponding period in 1998. Increased storage, reflecting a larger off-hire
fleet, was more than offset by reductions in charges for doubtful accounts,
repairs, repositioning and handling.

        Payments to container owners decreased to $31.8 million during the six
months ended June 30, 1999, a decrease of $7.3 million, or 18.7%, compared to
the corresponding period in 1998.

        Payments to U.S. Limited Partnerships amounted to $12.5 million, a
decline of $4.8 million or 27.7%, when compared to the corresponding period in
1998. Lower average utilization and per-diem rates, as well as a smaller
container fleet, caused the decline in net lease revenue for this segment.



                                                                              11
<PAGE>   14

                                THE CRONOS GROUP

        Payments to Other Container Owners were $19.2 million during the six
months ended June 30, 1999, a decrease of $2.5 million, or 11.5%, when compared
to the corresponding period in 1998, as lower average utilization and per-diem
rates more than offset a larger average fleet size. The increase in the average
fleet size was due to transactions involving the sale of equipment from both the
U.S. Limited Partnerships and Owned segments to the Other Container Owners
segment.

        Depreciation and amortization decreased by $1.1 million, or 11.3%,
during the six months ended June 30, 1999 to $8.4 million due to container sales
from the Owned to the Other Container Owners segment.

        Selling, general and administrative expenses decreased to $8.1 million
during the six months ended June 30, 1999 from $11.2 million in the
corresponding period of 1998, a decrease of $3.1 million or 27.5%. The decrease
was due primarily to a $1.5 million reduction in manpower and manpower-related
costs together with costs related to information technology, professional
services and communications.

        Interest expense of $6.2 million for the six months to June 30, 1999 was
$2.1 million lower, or 25.7%, compared to the corresponding period of 1998 due
primarily to a reduction in the average debt balances.

LIQUIDITY AND CAPITAL RESOURCES

        Cash from Operating Activities: Net cash provided by operating
activities was $12.0 million and $8.7 million during the first six months of
1999 and 1998, respectively. The net cash generated in 1999 reflected earnings
from operations together with the release of $4.9 million of deposits which had
been held in escrow, of which $2.7 million was utilized to make payments to
third party container owners. In addition, $5.3 million was received from the
sale of the Company's stock held as collateral on the Palatin Loans that was
utilized in reducing both short-term debt and Mr. Palatin's indebtedness to the
Company. The net cash generated in 1998 reflected earnings from operations
together with a $8.0 million decrease in new container equipment for resale.

        Cash from Investing Activities: Net cash provided by investing
activities was $19.1 million in the first six months of 1999 reflecting sales of
container equipment to third party container owners. Net cash used for investing
activities was $1.5 million in the first six months of 1998 reflecting purchases
of container and other equipment of $2.4 million, which was partly offset by
proceeds from equipment sales.

        Cash from Financing Activities: Net cash used by financing activities
was $34.9 million during the first six months of 1999 compared to $8.0 million
in the corresponding period of 1998. Repayments of debt and capital lease
obligations included $20.6 million in short-term debt repayments that were
generated from proceeds of container equipment sales. A further $5.3 million of
short-term debt was repaid following the sale of the Company's stock held as
collateral on the Palatin loans. In 1998, debt repayments of $9.9 million from
operating cash were partly offset by $1.9 million of additional funding.

        CAPITAL RESOURCES

        On August 2, 1999, the Company refinanced approximately $47.8 million of
its short-term and other indebtedness by establishing a Loan Facility (the "Loan
Facility") with MeesPierson N.V., a Dutch financial institution, as agent for
itself and First Union National Bank (collectively, the "Lenders"). The borrower
under the Loan Facility was Cronos Finance (Bermuda) Limited, a newly-organized,
wholly-owned, special purpose subsidiary of the Company ("Cronos Finance").
Cronos Finance borrowed $50.0 million under the Loan Facility for the purpose of
acquiring containers from three other direct or indirect wholly-owned
subsidiaries (the"Sellers") of the Company and paying certain fees associated
with the establishment of the Loan Facility and the fees of certain former
lenders. The Sellers utilized the cash proceeds from the sale of the containers
to Cronos Finance to repay $47.8 million in principal due by the Sellers to
eight different creditors or groups of creditors of the Group, including all
indebtedness owed to a group of banks for which Fleet Bank, N.A. acted as agent.

        Monies borrowed under the Loan Facility bear interest at the annual rate
of the 3-month LIBOR plus 1.50% (currently 6.8725%). The interest rate will be
re-set quarterly. Amounts borrowed under the Loan



                                                                              12
<PAGE>   15

                                THE CRONOS GROUP

Facility are repayable over five years, with a balloon payment of 25% of
borrowings due at the maturity. To secure the borrowings made under the Loan
Facility, the Lenders have been granted: (i) a first priority security interest
in the containers purchased by Cronos Finance; (ii) a guarantee by the Company
of 20% of the amount of the Credit facility; (iii) a second mortgage over the
Company's office building in Windsor, England; and (iv) certain additional
collateral. The Company guarantee is secured by (i) a pledge of the capital
stock held by the Company in Cronos Finance; (ii) a security interest in the
Company's shares of Common Stock of Transamerica Corporation (which are now
convertible into shares of Aegon N.V. as a result of the merger of Transamerica
with and into Aegon); and (iii) a pledge of the capital stock held by the
Company in Cronos Holdings/Investments (U.S.), Inc., a Delaware corporation
that, in turn, owns all of the outstanding capital stock of Cronos Capital
Corp., the general partner of the Group's U.S. container leasing limited
partnerships.

        For establishing the Loan Facility, the Lenders were paid an arrangement
fee of 1.50% of the Facility amount, issued 300,000 shares of Common Stock of
the Company (150,000 shares to each Lender) and were each granted a warrant to
purchase 100,000 shares of the Company's Common Stock at an exercise price of
$4.41 per share (the average of the daily closing price of the Company's Common
shares during the thirty day period preceding August 2, 1999). While the Lenders
have advised the Company that they have no present intent of selling or
otherwise disposing of the shares of Common Stock of the Company acquired by
them, the Company has agreed to register the 300,000 shares issued to the
Lenders under the Securities Act of 1933, as amended, within sixty days of
August 2, 1999. In addition, under the Warrant Agreement entered into by the
Company and the Lenders, the Lenders have the right to demand registration of
the shares issuable thereunder.

        The Company will amortize the arrangement fee it paid to establish the
Loan Facility ($0.75 million) and the fair market value of the 300,000 shares it
issued to the Lenders to establish the Loan Facility ($1.275 million, determined
by multiplying the 300,000 shares by the closing price of the Company's Common
Stock on August 2, 1999) over the five-year term of the borrowings made under
the Loan Facility.

        The establishment of the Loan Facility and the repayment of
approximately $47.8 million in short-term indebtedness will result in a
reduction in the annual interest payable by the Company on its indebtedness.
Management estimates that the Company's interest cost will be reduced by
approximately $1.4 million per annum (assuming no material increase in LIBOR) as
a result of the establishment of the Loan Facility from the amounts payable by
the Company on its indebtedness as such indebtedness stood prior to the
establishment of the Loan Facility. These interest savings will be offset, in
part, by the costs of establishing the Facility, including the arrangement fee
paid and Common Stock issued to the Lenders and the legal expenses incurred by
the Company in establishing the Loan Facility.

        In conjunction with the new facility, the Company has agreed to new
financial covenant levels with all of its current lenders and has obtained
waivers of non-compliance under current financial covenants. In addition, as
part of the facility, all lenders have agreed that the new covenant levels will
not be tested until the first quarter of 2000.



                                                                              13
<PAGE>   16

                                THE CRONOS GROUP

        YEAR 2000

        The Company's computer systems have undergone modifications in order to
render the systems ready for the year 2000. The Company has completed a detailed
inventory of all software and hardware systems and has identified all components
that need to be modified. The Company has completed all the necessary changes
and testing in a dedicated year 2000 environment. The Company anticipates that
all compliant code will be live by the end of August 1999. The Company has
contacted all of its critical business suppliers and has been advised that their
systems are year 2000 compliant. The Company has also confirmed the compliance
of its suppliers' products through its own extensive testing. Expenses
associated with addressing the year 2000 issues are being recognized as
incurred. Management has not yet assessed the year 2000 compliance expense but
does not anticipate the costs incurred to date or to be incurred in the future
to be in excess of $0.5 million. The Company believes it will be able to resolve
any major year 2000 issues.

        The Company is aware of the implications of a year 2000 computer system
failure and is currently in the process of developing its contingency plans.
Whilst management believes the possibility of a year 2000 system failure to be
remote, if the Company's internal systems or those of its critical business
suppliers fail, the Company's consolidated financial position, liquidity or
results of operations may be adversely affected.

ITEM 3 -- QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

        Interest rate risk: outstanding borrowings are subject to interest rate
risk. Approximately 65% and 60% of total borrowings had floating interest rates
at December 31, 1998 and June 30, 1999, respectively.

        Exchange rate risk: Substantially all of the Company's revenues are
billed and paid in U.S. dollars and a significant portion of costs are billed
and paid in U. S. dollars. Of the remaining costs, the majority are individually
small, unpredictable and incurred in various denominations and thus are not
suitable for cost effective hedging. From, time to time, Cronos hedges a portion
of the expenses that are predictable and are principally in U.K. pounds
sterling. In addition, almost all of the Company's container purchases are paid
for in U.S. dollars.

        As exchange rates are outside of the control of the Company, there can
be no assurance that such fluctuations will not adversely effect its results of
operations and financial condition.

        The Company has assessed the introduction of a single European Currency,
the Euro, and believes that it will not be materially affected. In the past, the
effects of inflation on administrative and operating expenses have been largely
offset by the Company's ability to increase the operational economies of scale
through expansion of the fleet.



                                                                              14
<PAGE>   17

                                THE CRONOS GROUP

                           PART II --OTHER INFORMATION

ITEM 1 -- LEGAL PROCEEDINGS

SEC Investigation

        As the Company has previously reported, in February 1997, the Company's
former independent auditors, Arthur Andersen LLP ("Arthur Andersen"), resigned
as auditors to the Company, its subsidiaries, and related partnerships. In
connection with its resignation, Arthur Andersen prepared a report pursuant to
Section 10A of the Securities Exchange Act of 1934, as amended, for filing by
the Company with the Securities and Exchange Commission ("SEC"). In its report,
Arthur Andersen cited, as a reason for its resignation, its inability to obtain
what it believed to be adequate responses to its inquiries of former management
regarding the payment and subsequent return of $1.5 million paid by the Company
purportedly for professional fees in connection with a proposed strategic
alliance of the Company. The Arthur Andersen report constituted a "reportable
event" under the SEC's Regulation S-K in that it constituted advice to the
former management of the Company that information had come to Arthur Andersen's
attention that had made it unwilling to be associated with the financial
statements prepared by the former management of the Company.

        As a result of the Arthur Andersen report, the SEC commenced a private
formal investigation of the Company on February 10, 1997. The focus of the
investigation has been to determine whether the Company and persons associated
with the Company violated the federal securities laws administered by the SEC.
Current management of the Company has been in discussions with the SEC with a
view to settling the investigation as to the Company. The Company is hopeful of
reaching a settlement of the investigation by the end of 1999. The Company does
not believe that any current director or officer of the Company is a subject of
the investigation.

Special Litigation Committee:

        The Board of Directors of the Company established a Special Litigation
Committee ("Committee") of the Board in July 1998 to examine the relationships
between Stefan M. Palatin, the former Chairman of the Board and Chief Executive
Officer of the Company, and Contrin Holding S.A. ("Contrin"), Barton Holding Ltd
("Barton"), and affiliated persons. The Committee is also investigating
transactions between the Company and its present and former officers and
directors for the period from January 1, 1995, to determine whether improper
self-dealing occurred between the Company and such persons. The Committee
intends to complete its investigation by the end of 1999. The Committee has the
power, for and on behalf of the Company, and in consultation with counsel, to
pursue the recovery of any damages the Committee concludes may have been
suffered by the Company as a result of the transactions or conduct the Committee
investigates.

ITEM 2 -- CHANGES IN SECURITIES AND USE OF PROCEEDS

        None

ITEM 3 -- DEFAULTS UPON SENIOR SECURITIES

        None

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

        None



                                                                              15
<PAGE>   18

                                THE CRONOS GROUP

ITEM 5 -- OTHER INFORMATION

        CAUTIONARY STATEMENTS FOR THE PURPOSES OF THE "SAFE HARBOR" PROVISIONS
OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

        This Quarterly Report on Form 10-Q contains statements relating to
future results of the Company, including certain projections and business
trends, that are "forward-looking statements" as defined in the Private
Securities Litigation Reform Act of 1995. Actual results may differ materially
from those projected as a result of certain risks and uncertainties, including
but not limited to changes in: economic conditions; trade policies; demand for
and market acceptance of leased marine cargo containers; competitive utilization
and per-diem rental rate pressures; as well as other risks and uncertainties,
including but not limited to those described above in the discussion of the
marine container leasing business under Item 2, Management's Discussion and
Analysis of Financial Condition and Results of Operations; and those detailed
from time to time in the filings of the Company with the Securities and Exchange
Commission.

ITEM 6 -- EXHIBITS AND REPORTS ON FORM 8-K

(a)     Exhibits

<TABLE>
<CAPTION>
Number     Description
------     -----------
<S>        <C>
4.1        Warrant Agreement, dated as of July 30, 1999, by and between the
           Company and MeesPierson N.V. ("MeesPierson") and First Union National
           Bank ("First Union").

10.20      Guarantee, dated as of July 30, 1999, by and between the Company and
           MeesPierson, as agent on behalf of itself and First Union.

10.21      Loan Agreement, dated as of July 30, 1999, by and between Cronos
           Finance (Bermuda) Limited ("CFBL") as issuer, and MeesPierson, as
           agent, on behalf of itself and First Union, as initial noteholders.

10.22      CFBL Secured Note, dated as of July 30, 1999, in the principal amount
           of U.S. $25,000,000, in favor of MeesPierson.

10.23      CFBL Secured Note, dated as of July 30, 1999, in the principal amount
           of U.S. $25,000,000, in favor of First Union.

10.24      Issuer Stock Pledge Agreement [CFBL], dated as of July 30, 1999, by
           and between the Company and MeesPierson, as agent on behalf of itself
           and First Union.

10.25      Stock Pledge Agreement [Cronos Holdings/Investments (U.S.), Inc.],
           dated as of July 30, 1999, by and between the Company and
           MeesPierson, as agent on behalf of itself and First Union.

27         Financial Data Schedule
</TABLE>

(b)     Reports on Form 8-K

        On April 1, 1999, a Current Report on Form 8-K was filed by the Company
announcing the resignation of Rudolf J Weissenberger, Chairman of the Board of
Directors and non-executive director, and Axel Friedberg, non-executive
director. Dennis J Tietz and Charles Tharp were appointed Chairman and
non-executive director, respectively.

        On April 13, 1999, a Current Report on Form 8-K was filed by the Company
announcing the resignation of Stephen J Brocato, president of the Company's
leasing division.



                                                                              16
<PAGE>   19

                                THE CRONOS GROUP

                                   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.

                                        THE CRONOS GROUP

<TABLE>
<CAPTION>
SIGNATURE                                                 TITLE                                   DATE
---------                                                 -----                                   ----
<S>                                    <C>                                                  <C>
By     /s/ P J Younger                 Executive Vice President, Chief Financial            August 11, 1999
--------------------------------       Officer and Chief Accounting Officer
       Peter J. Younger                (Principal Financial and Accounting Officer)
</TABLE>



                                                                              17
<PAGE>   20

                                THE CRONOS GROUP

                                  EXHIBIT INDEX

<TABLE>
<CAPTION>
Number  Exhibit                                                                              Page
------  -------                                                                              ----
<S>      <C>                                                                                  <C>
4.1     Warrant Agreement, dated as of July 30, 1999, by and between the Company
        and MeesPierson N.V. ("MeesPierson") and First Union National Bank
        ("First Union").                                                                      [ ]

10.20   Guarantee, dated as of July 30, 1999, by and between the Company and
        MeesPierson, as agent on behalf of itself and First Union. [ ]

10.21   Loan Agreement, dated as of July 30, 1999, by and between Cronos Finance
        (Bermuda) Limited ("CFBL") as issuer, and MeesPierson, as agent, on
        behalf of itself and First Union, as initial noteholders.                             [ ]

10.22   CFBL Secured Note, dated as of July 30, 1999, in the principal amount of
        U.S. $25,000,000, in favor of MeesPierson.                                            [ ]

10.23   CFBL Secured Note, dated as of July 30, 1999, in the principal amount of
        U.S. $25,000,000, in favor of First Union.                                            [ ]

10.24   Issuer Stock Pledge Agreement [CFBL], dated as of July 30, 1999, by and
        between the Company and MeesPierson, as agent on behalf of itself and
        First Union.                                                                          [ ]

10.25   Stock Pledge Agreement [Cronos Holdings/Investments (U.S.), Inc.], dated
        as of July 30, 1999, by and between the Company and MeesPierson, as
        agent on behalf of itself and First Union.                                            [ ]

27.     Financial Data Schedule 19
</TABLE>



                                                                              18