<PAGE>   1
                       SECURITIES AND EXCHANGE COMMISSION

                              Washington, DC 20549

                                   Form 10-Q

                  QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                    For the Quarter Ended December 31, 1996
                    ----------------------------------------

                         Commission File Number 1-12476
                         ------------------------------

                           SUN COAST INDUSTRIES, INC.
                           --------------------------
                           (Exact name of Registrant)

         Delaware                                        #59-1952968
------------------------                       ---------------------------------
(State of Incorporation)                       (IRS Employer Identification No.)


                 2700 South Westmoreland Ave., Dallas, TX 75233
                 ----------------------------------------------
                    (Address of principal executive offices)


                                 (214) 373-7864
                        -------------------------------
                        (Registrant's telephone number)

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 the number of shares outstanding of each of the issuers' classes of 
common stock, as of November 6, 1996, the latest practicable date.

          Class                              Outstanding at February 10, 1997
          -----                              --------------------------------
Common stock $0.01 par value                             4,104,229


                                       1
<PAGE>   2
                           SUN COAST INDUSTRIES, INC.
                                     INDEX

<TABLE>
<S>                                                                <C>
Part I. Financial Information

Item I - Financial Statements

   Condensed Consolidated Balance Sheets --December 31, 1996
   and June 30, 1996                                               3

   Condensed Consolidated Statements of Income - Six Months
   ended December 31, 1996 and 1995                                5

   Condensed Consolidated Statements of Income - Three Months
   Ended December 31, 1996 and 1995                                6

   Condensed Consolidated Statements of Cash Flows -- Six  
   Months ended December 31, 1996 and 1995                         7

   Notes to Condensed Consolidated Financial Statements            8

Item II - Management's Discussion and Analysis of Financial
   Condition and Results of Operations                            13

Part II. Other Information

Items 1 through 6                                                 16

</TABLE>


                                       2
<PAGE>   3
PART I. FINANCIAL INFORMATION

Item I. FINANCIAL STATEMENTS

                           SUN COAST INDUSTRIES, INC.
                     CONDENSED CONSOLIDATED BALANCE SHEETS
                             (dollars in thousands)

<TABLE>
<CAPTION>
                                                  December 31, 
                                                     1996      June 30,
                                                  (unaudited)    1996
                                                  -----------  --------
<S>                                                 <C>        <C>
ASSETS

Current assets:
  Cash and cash equivalents                         $  3,674   $  1,787
  Accounts receivable, net of allowance for
     doubtful accounts of $77 and $77                  7,014      8,483
  Inventories                                          5,612      5,411
  Other current assets                                    99        408
  Deferred income taxes                                  478        205
  Net assets of discontinued                           
    operations                                         6,265     13,094
                                                    --------   --------

     Total current assets                             23,142     29,388

Property, plant and equipment, net of accumulated
  depreciation of $22,578 and $20,295                 21,154     23,113
Intangible assets                                        269        280
Other assets                                           2,023      1,352
                                                    --------   --------

     Total assets                                   $ 46,588   $ 54,133
                                                    ========   ========
</TABLE>

     See accompanying notes to condensed consolidated financial statements.


                                       3
<PAGE>   4
                           SUN COAST INDUSTRIES, INC.
                     CONDENSED CONSOLIDATED BALANCE SHEETS
                    (dollars in thousands, except par value)

<TABLE>
<CAPTION>                                        
                                                   December 31,
                                                      1996      June 30,
LIABILITIES AND STOCKHOLDERS' EQUITY               (unaudited)   1996
                                                    ---------- --------
<S>                                                 <C>        <C>
Current liabilities:
  Accounts payable                                  $  4,653   $  5,275
  Accrued expenses                                     3,400      2,678
  Current portion
     of long-term debt                                15,451     26,157
                                                    --------   --------

     Total current liabilities                        23,504     34,110

Long-term debt                                        11,456      3,124
Deferred income taxes                                  1,854      2,055
                                                    --------   --------

     Total liabilities                                36,814     39,289
                                                    --------   --------

Stockholders' equity:
  Common stock, $.01 par value; 40,000,000
     shares authorized; 4,017,629 issued and
     4,004,229 outstanding                                40         40
  Additional paid-in capital                          11,342     11,339
  Treasury stock                                        (153)      (153)
  Retained earnings (deficit)                         (1,455)     3,618
                                                    --------   --------
     Total stockholders' equity                        9,774     14,844
                                                    --------   --------
     Total liabilities and stockholders' equity     $ 46,588   $ 54,133
                                                    ========   ========
</TABLE>

     See accompanying notes to condensed consolidated financial statements.





                                       4
<PAGE>   5
                           SUN COAST INDUSTRIES, INC.
                  CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                                  (UNAUDITED)
                 (dollars in thousands, except per share data)

<TABLE>
<CAPTION>
                                                Six Months Ended      
                                                 December 31, 
                                             ---------------------
                                              1996          1995    
                                             -------      --------
<S>                                          <C>          <C>         
Sales                                        $31,581      $ 27,520    
                                                                      
                                                                      
Costs and expenses:                                                   
  Cost of sales                               25,248        22,824    
  Selling, general and administrative          4,220         3,661    
  Interest, net                                  985           749    
                                             -------      --------

                                              30,453        27,234    
                                             -------      --------
                                                                      
Income from continuing operations
  before provision for income taxes            1,128           286    
Provision for income taxes                      (356)         (127)    
                                             -------      --------
     Income from continuing 
       operations                                772           159    

Discontinued operations (Note 2)
  Loss from discontinued
    operations, net of income
    taxes of $405 and $281, 
    respectively                                (819)         (410)

  Loss on disposal of discontinued
    operations, net of income taxes
    of $2,817                                 (5,025)          --
                                             -------      --------
  Net loss                                   $(5,072)     $   (251)
                                             =======      ========
Net income (loss) per common share:
  Continuing operations                      $  0.18      $   0.04
  Discontinued operations                      (1.40)        (0.10)
                                             -------      --------
Net loss per common share                    $ (1.22)     $  (0.06)
                                             =======      ========
</TABLE>

     See accompanying notes to condensed consolidated financial statements.





                                       5
<PAGE>   6
                           SUN COAST INDUSTRIES, INC.
                  CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                                  (UNAUDITED)
                 (dollars in thousands, except per share data)

<TABLE>
<CAPTION>
                                              Three Months Ended      
                                                 December 31, 
                                             ---------------------
                                              1996          1995    
                                             -------      --------
<S>                                          <C>          <C>         
Sales                                        $15,585      $ 13,311    
                                                                      
                                                                      
Costs and expenses:                                                   
  Cost of sales                               12,533        11,079    
  Selling, general and administrative          2,228         1,767    
  Interest, net                                  488           360    
                                             -------      --------

                                              15,249        13,206    
                                             -------      --------
                                                                      
Income from continuing operations
  before provision for income taxes              336           105    
Provision for income taxes                       (99)           31     
                                             -------      --------
     Income from continuing
       operations                                237           136     

Discontinued operations (Note 2)
  Loss from discontinued
    operations, net of income taxes
    of $260 and $171 respectively               (474)         (475)

  Loss on disposal of discontinued
    operations, net of income taxes
    of $2,817                                (5,025)           --
                                             -------      --------

  Net loss                                   $(5,262)     $   (339)
                                             =======      ========

Net income (loss) per common share:
  Continuing operations                      $  0.06      $   0.03
  Discontinued operations                      (1.37)        (0.11)
                                             -------      --------
Net loss per common share                    $ (1.31)     $  (0.08)
                                             =======      ========
</TABLE>

     See accompanying notes to condensed consolidated financial statements.





                                       6
<PAGE>   7
                           SUN COAST INDUSTRIES, INC.
                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                  (UNAUDITED)
                             (dollars in thousands)

<TABLE>
<CAPTION>
                                                                     Six Months Ended
                                                                      December 31,
                                                                   -------------------
                                                                    1996         1995
                                                                   ------       ------   
<S>                                                               <C>           <C>        
Cash flows from operating activities:                                                    
                                                                                         
  Net loss                                                        $(5,072)      $ (251)  
  Adjustments to reconcile net income to                                                   
     net cash provided by (used in) operations:                                             
     Depreciation and amortization                                  2,969        2,840   
     Gain on sale of assets                                           165           --
     Deferred income taxes                                           (636)        (103)  
     Loss from discontinued operations                              4,821           --
                                                                                         
  Changes in assets and liabilities:                                                       
     Accounts receivable                                            2,500          981   
     Inventories                                                      602        1,744   
     Other current assets                                             360           63   
     Intangible and other assets                                     (712)        (117)  
     Accounts payable and accrued expenses                            340         (541)  
                                                                  -------       ------   
  Net cash provided by operations                                   5,337        4,616   
                                                                  -------       ------   
Cash flows from investing activities:                                                    
                                                                                         
  Capital expenditures                                             (1,229)      (2,641)  
                                                                  -------       ------   

Net cash used in investing activities                              (1,229)      (2,641)  
                                                                  -------       ------   
Cash flows from financing activities:                                                    

  Proceeds from long-term debt                                          0          458

  Repayments of long-term debt                                     (2,375)      (2,450)  
                                                                                         
  Issuance of Common Stock                                              -         (111)  
                                                                  -------       ------   
     Net cash used in provided by financing activities             (2,375)      (2,103)  
                                                                  -------       ------   
     Effect of exchange rate changes on cash                           (6)        (146)  
                                                                  -------       ------   
     Change in cash and cash equivalents                            1,727         (274)  
     Cash and cash equivalents at beginning of period               1,947        1,173   
                                                                  -------       ------   
     Cash and cash equivalents at end of period                   $ 3,674       $  899   
                                                                  =======       ======   
</TABLE>

     See accompanying notes to condensed consolidated financial statements.


                                       7
<PAGE>   8
                           SUN COAST INDUSTRIES, INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               DECEMBER 31, 1996

NOTE 1 - THE BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     Basis of Presentation

     The Company's (defined below) interim financial statements are unaudited
     and should be read in conjunction with the consolidated financial
     statements and notes thereto in its Form 10-K and Annual Report to
     Stockholders for the year ended June 30, 1996.

     In the opinion of management, the accompanying consolidated financial
     statements contain all adjustments, consisting only of those of a normal
     recurring nature, necessary for a fair statement of the results of
     operations for the interim periods presented.

     Description of Business

     Sun Coast Industries, Inc. (the "Company") manufactures and sells melamine
     and urea resins and compounds and, from these and other materials, molds
     consumer products and commercial plastic products, including dinnerware,
     drinkware and closures. The Chemical Division manufactures melamine and
     urea resins and compounds, which it supplies to other manufacturers and
     uses in producing its own consumer products and foodservice products. The
     Closures Division manufactures linerless, foil or foam lined and
     tamper-evident plastic closures and lids. These closures are used in the
     U.S. for bottling and packaging of food, beverage, chemical and
     pharmaceutical products. The Consumer Products and Foodservice Divisions,
     which are being discontinued (see Note 2), manufacture compression molded
     melamine dinnerware and injection molded plastic drinkware and other
     houseware products, which the Company sells to American, Canadian and
     Mexican retail and commercial markets.



                                       8
<PAGE>   9
                           SUN COAST INDUSTRIES, INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               DECEMBER 31, 1996

NOTE 1 - THE BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
         (Cont'd)

     Principles of Consolidation

     The consolidated financial statements include the accounts of the Company
     and its subsidiaries, all of which are wholly-owned. All significant
     intercompany balances and transactions have been eliminated in
     consolidation. Certain amounts in previously issued financial statements
     have been reclassified to conform with the current period financial
     statement presentation. The preparation of consolidated financial
     statements in conformity with generally accepted accounting principles
     requires management to make estimates and assumptions that affect the
     reported amounts of assets and liabilities at the date of the financial
     statements and the reported amounts of revenues and expenses during the
     period.  Actual results could differ from the estimates. Certain amounts
     in previously issued financial statements have been reclassified to
     conform with the current year financial statement presentation.

     Inventories

     Inventories are valued at the lower of cost or market, with cost
     determined utilizing the first-in, first-out (FIFO) method.

     Property, Plant and Equipment

     Property, plant and equipment are carried at cost and depreciated using
     the straight-line method over the estimated useful lives of the related
     assets. Lives assigned to asset categories are 5 to 15 years for machinery
     and equipment, 30 to 35 years for buildings and 5 years for molds.
     Machinery and equipment under capital leases are stated at the present
     value of minimum lease payments and amortized over 1 to 3 years. Renewals
     and improvements that significantly add to the productive capacity or 
     extend the useful life of an asset are capitalized.  Repairs and 
     maintenance are charged to expense as incurred.


     Goodwill

     Goodwill, which represents the excess of purchase price over fair value of
     net assets acquired, is amortized on a straight-line basis over the
     expected periods to be benefited, ranging from 5 - 20 years. The Company
     assesses the recoverability of this intangible asset by determining
     whether the amortization of the goodwill balance over its remaining life
     can be recovered through undiscounted future operating cash flows of the
     acquired operation. The amount of goodwill impairment, if any, is measured
     based on projected discounted future operating cash flows using a discount
     rate reflecting the Company's average cost of funds. The assessment of the
     recoverability of goodwill will be impacted if estimated future operating
     cash flows are not achieved.

     Impairment of Long-Lived Assets and Long-Lived Assets to Be Disposed Of

     The Company adopted the provisions of SFAS No. 121, Accounting for the
     Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed
     Of, on July 1, 1997. This Statement requires that long-lived assets and
     certain identifiable intangibles be reviewed for impairment whenever
     events or changes in circumstances indicate that the carrying amount of an
     asset may not be recoverable. Recoverability of assets to be held and used
     is measured by a comparison of the carrying amount of an asset to future
     net cash flows expected to be generated by the asset. If such assets are
     considered to be impaired, the impairment to be recognized is measured by
     the amount by which the carrying amount of the assets exceed the fair value
     of the assets. Assets to be disposed of are reported at the lower of the
     carrying amount or fair value less costs to sell. Adoption of the
     Statement did not have a material impact on the Company's financial
     position, results of operations, or liquidity.



                                       9
<PAGE>   10
                           SUN COAST INDUSTRIES, INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               DECEMBER 31, 1996

NOTE 1 - THE BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
         (Cont'd)

     Advertising Costs

     The Company expenses the costs of advertising as incurred, except for
     direct-response advertising and catalog costs which are capitalized and
     amortized over their expected periods of future benefit (generally six
     months). Direct response advertising and catalog costs consist primarily
     of printing and contract services for catalogs to market the Company's
     products.

     Income Taxes

     Deferred income taxes are provided for temporary differences between
     financial and tax reporting. Income taxes are provided for taxes currently
     payable based on taxable income.

     Environmental Costs

     A liability for environmental assessments and/or cleanup is accrued when
     it is probable a loss has been incurred and is estimable. No significant
     liabilities were in existence at December 31, 1996 and June 30, 1996.

     Net Income Per Common Share

     Net income per common share is computed by dividing net income by the
     weighted average number of common shares outstanding during each period
     after giving effect to stock options and warrants considered to be
     dilutive common stock equivalents.





                                      10
<PAGE>   11
                           SUN COAST INDUSTRIES, INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               DECEMBER 31, 1996

NOTE 1 - THE BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
         (Cont'd)

     Revenue Recognition

     Sales are recognized when the product is shipped. Sales are shown net of
     returns and allowances.

     Research and Development

     Research and development costs associated with new product development,
     application and testing are expensed as incurred.

     Statement of Cash Flows

     For purposes of the statements of cash flows, the Company considers all
     highly liquid investments with original maturities of three months or less
     to be cash equivalents.

     Foreign Currency Translation and Transactions

     The Company's foreign subsidiary uses the local currency as the functional
     currency. Translation gains or losses are included as a component of
     stockholders' equity. Gains or losses from foreign currency transactions
     are included in net income. There were no material gains or losses from
     foreign currency translation or transactions prior to 1996. There was a
     $69,000 translation loss and a $668,000 translation loss for the six  
     months ended December 31, 1996 and for fiscal 1996, respectively.  There
     were no material gains or losses from foreign currency transactions for
     the six months ended December 31, 1996 and for fiscal 1996.


NOTE 2 - DISCONTINUED OPERATIONS

     On December 6, 1996, the Company's Board of Directors adopted a formal plan
     to dispose of its Foodservice and Consumer Products Tableware Divisions.
     These divisions have been accounted for as discontinued operations in
     accordance with APB 30, which among other provisions, requires the plan of
     disposal to be carried out within one year. Management believes this is a
     reasonable time period for the disposal. In February, the Company entered
     into a letter of intent to sell its Foodservice Division and it has plans
     underway to exit the Consumer Products Division.

     Based on management's assumptions used in determining the estimated gain or
     loss from the disposal of the tableware business, the Company recorded a
     provision of $5.025 million, net of income taxes, for the loss on disposal
     of the discontinued business in the quarter ended December 31, 1996. 
     This loss on disposal of discontinued operations resulted from the 
     estimated net loss on the sale of the Foodservice Division and estimated
     net loss on the exit of the Consumer Products Division of approximately
     $4.167 million, net of income taxes, as well as estimated operating losses
     during the period required to dispose of the divisions of approximately
     $858,000, net of income taxes. Sales of the divisions for the two months 
     and five months of fiscal 1997 prior to the December 6th Board's decision 
     to discontinue these operations were $3.007 million and $7.678 million, 
     respectively. Comparable sales for the three and six month periods ended 
     December 31, 1995 were $5.267 million and $10.431 million, respectively.

     The net assets of discontinued operations are summarized as follows:

<TABLE>
<CAPTION>
                                 DECEMBER 31,         JUNE 30,
                                     1996               1996
                                 ------------         --------
($ in thousands)
<S>                              <C>                  <C>
Current assets                      $   6,458          $ 8,484
Plant, property and equipment           5,729            5,598
Intangible & other assets                 586              646
Current liabilities                      (408)            (385)
Accrued expenses                         (460)            (257)
Long term debt                         (1,000)          (1,000)
Deferred taxes                           (556)            (660)
Foreign Currency Translation              737              668
Provision for estimated loss 
  on disposal                          (4,821)              -
                                    ---------          -------
Net assets of discontinued 
  operations                        $   6,265          $13,094
                                    =========          =======
</TABLE>


NOTE 3 - INVENTORIES

<TABLE>
<CAPTION>
                                 December 31, 
                                     1996              June 30,
                                 (unaudited)            1996
                                 ------------         --------
                                        (in thousands)
<S>                               <C>                 <C>
Raw Materials                     $    3,238          $  2,837
Work-in-process                          183               328
Finished good                          2,856             2,805
                                  ----------          --------
                                       6,277             5,970
Obsolescence reserve                    (665)             (559)
                                  ----------          --------
                                  $    5,612          $  5,411
                                  ==========          ========
</TABLE>




                                       11
<PAGE>   12
NOTE 4 - LONG TERM DEBT

<TABLE>
<CAPTION>
                                                         December 31,                    
                                                            1996              June 30, 
                                                         (unaudited)           1996   
                                                         ----------          --------  
                                                               (in thousands)        
<S>                                                      <C>                 <C>
Term Loan                                                $    4,963          $  5,818     
Revolving credit line                                        12,211            12,659     
Capital expenditures term loan                                7,341             8,437     
Industrial development revenue bonds                          2,100             2,175     
Capitalized lease obligations                                   292               192     
                                                         ----------          --------  
                                                             26,907            29,281     
Current maturities on original                                                            
   maturity schedule                                         (3,240)           (2,277)    
Long term debt classified as current                        (12,211)          (23,880)    
                                                         ----------          -------- 
                                                         $   11,456          $  3,124     
                                                         ==========          ========
</TABLE>

     At December 31, 1996, the Company was not in compliance with two of its
     loan covenants on its then existing credit facility: (1) The Company's
     Tangible Net Worth (as defined in the credit facility) was below the
     required minimum $14,650,000 and (2) the Company's Fixed Charge Coverage
     Ratio (as defined in the Credit Facility) was below the required minimum of
     1.3 to 1.0.

     In January 1997, the Company refinanced its existing debt with a new
     lender to provide a total credit facility of $30 million in borrowings
     secured by substantially all the assets of the Company.  The facility
     provides for borrowings under three separate arrangements - (i) a term
     loan in an aggregate principal amount of $10 million payable in monthly
     installments through January 31, 2000. (ii) a second term loan in an
     aggregate principal amount of $5 million payable in monthly installments
     beginning January 1, 1998 through January 31, 2000, and (iii) a $15.0
     million revolving loan, due January 31, 2000.  As of January 31, 1997,
     outstanding borrowings under the credit facility included $15 million 
     under the two term loans, and $8.1 million under the revolving credit 
     line.  At January 31, 1997, based on the Company's borrowing formula 
     incremental borrowing availability was approximately $3.2 million under 
     the revolving credit line. The credit facility provides for the issuance 
     of up to $2.0 million of letters of credit, subject to the borrowing 
     availability under the revolving credit line.  The loan agreement  
     contains various covenants, including maintaining certain financial ratios
     and tests, limitation on the issuance of debt and the amount of capital 
     expenditures, capital leases, investments and dividends.  The primary 
     financial covenants include quarter end calculations of leverage and 
     fixed charge coverage and a limitation on annual capital expenditures.

     As the Company is currently in compliance with the loan covenants on its
     new debt, the long term portions of the term loans previously classified as
     a current liability have been reclassified to a long term liability on the
     consolidated balance sheet at December 31, 1996.


                                       12
<PAGE>   13
Item II. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
         AND RESULTS OF OPERATIONS

     Three Months Ended December 31, 1996, Compared to the Three Months
               Ended December 31, 1995 for Continuing Operations

     Sales for the three months ended December 31, 1996, increased $2,274,000
     or 17.1%, when compared to the same period in 1995.  Closure Division's
     sales increased 10.7% due to increased market share.  Chemical Division's 
     sales increased 23.4% due to increased customer demand.

     Cost of sales as a percentage of net sales decreased to 80.4% from 83.2%.
     The improvement in gross margin was primarily the result of stabilized raw
     material prices and efficiencies gained from increased sales volume.

     Selling, general and administrative expense ("SG&A") increased $461,000
     to 14.30% of sales for the three months ended December 31, 1996 as
     compared to 13.3% of sales for the three months ended December 31, 1995.
     This increase is the result of certain expenses related to the refinancing 
     of bank debt and costs related to review of various strategic alternatives.

     Interest expense has increased $128,000 for the three months ended
     December 31, 1996 compared to the three months ended December 31, 1995
     due to an increase in interest rates.

     Net income from continuing operations increased $101,000 from the 
     comparable prior fiscal period primarily due to the increased sales 
     volumes.


                                       13
<PAGE>   14
Item II. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
         AND RESULTS OF OPERATIONS

     Six Months Ended December 31, 1996, Compared to the Six Months
     Ended December 31, 1995 for Continuing Operations

     Sales for the six months ended December 31, 1996, increased $4,061,000
     or 14.8%, when compared to the same period in 1995.  Closure Division's
     sales increased 11.4% and Chemical Division's sales increased 18.0% both 
     due to increased customer demand.  

     Cost of sales as a percentage of net sales decreased to 79.9% from 82.9%.
     This improvement in gross margin was due primarily to the increased
     volume.

     Selling, general and administrative expense ("SG&A") increased $559,000.
     However, as a percent of sales, it remained fairly constant at 13.4% of 
     sales for the six months ended December 31, 1996 as compared to 13.3% of 
     sales for the six months ended December 31, 1995.
     
     Interest expense has increased $236,000 for the six months ended
     December 31, 1996 compared to the six months ended December 31, 1995
     due to an increase in interest rates.

     Net income from continuing operations increased $613,000 from the 
     comparable prior fiscal period primarily due to increased sales volumes.

     Discontinued Operations

     On December 6, 1996, the Company's Board of Directors adopted a formal plan
     to dispose of its Foodservice and Consumer Products Tableware Divisions.
     These divisions have been accounted for as discontinued operations in
     accordance with APB 30, which among other provisions, requires the plan of
     disposal to be carried out within one year. Management believes this is a
     reasonable time period for the disposal. In February, the Company entered
     into a letter of intent to sell its Foodservice Division and it has plans
     underway to exit the Consumer Products Division.

     Based on management's assumptions used in determining the estimated gain or
     loss from the disposal of the tableware business, the Company recorded a
     provision of $5.025 million, net of income taxes, for the loss on disposal
     of the discontinued business in the quarter ended December 31, 1996. 
     This loss on disposal of discontinued operations resulted from the 
     estimated net loss on the sale of the Foodservice Division and estimated
     net loss on the exit of the Consumer Products Division of approximately
     $4.167 million, net of income taxes, as well as estimated operating losses
     during the period required to dispose of the divisions of approximately
     $858,000, net of income taxes. 

     Sales of the divisions for the two months  and five months of fiscal 1997
     prior to the December 6th Board's decision  to discontinue these
     operations were $3.007 million and $7.678 million,  respectively.
     Comparable sales for the three and six month periods ended  December 31,
     1995 were $5.267 million and $10.431 million, respectively.  The Consumer
     Products and Foodservice Divisions' sales decreased 20.6% and 15.7% for
     the three month and six month periods ended December 31, 1996 as compared
     to the prior year comparable periods. These sales decreases were  a result
     of competitive pressures and the downturn in the respective  markets. The
     lower sales volumes also resulted in decreased gross margins  for these
     tableware divisions as fixed costs could not be fully absorbed.
        
     Liquidity and Capital Resources

     Management reviews the Company's working capital, accounts receivable and
     relationship of debt to equity on a continuing basis. The Company's growth
     has been financed through long-term debt financing and cash generated from
     operations. During the six months ended December 31, 1996, the Company
     decreased net borrowings by $2,375,000. Cash flow from operations generated
     $5.3 million.

     Capital expenditures for the six months ended December 31, 1996 were
     $1,229,000. Anticipated future capital additions should approximate less
     than $4 million for the remainder of fiscal 1997, including approximately
     $2 million for the purchase, in January 1997, of a second facility to 
     expand capacity in the Closures Division in Florida.

     In January 1997, the Company refinanced its existing debt with a new lender
     to provide a total credit facility of $30 million in borrowings secured by
     substantially all the assets of the Company. The facility provides for
     borrowings under three separate arrangements - (i) a term loan in an
     aggregate principal amount of $10 million payable in monthly installments
     through January 31, 2000, (ii) a second term loan in an aggregate 




                                       14
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<PAGE>   15
     principle amount of $5 million payable in monthly installments beginning
     January 1, 1998 through January 31, 2000, and (iii) a $15.0 million
     revolving loan, due January 31, 2000. As of January 31, 1997, outstanding
     borrowings under the credit facility included $15 million under the two
     term loans and $8.1 million under the revolving credit line. At January
     31, 1997, based on the Company's borrowing formula incremental borrowing
     availability was approximately $3.2 million under the revolving credit
     line. The credit facility provides for the issuance of up to $2.0 million
     of letters of credit, subject to the borrowing availability under the
     revolving credit line. The loan agreement contains various covenants,
     including maintaining certain financial ratios and tests, limitation on the
     issuance of debt and the amount of capital expenditures, capital leases,
     investments and dividends. The primary financial covenants include quarter
     end calculations of leverage and fixed charge coverage and a limitation on
     annual capital expenditures.

     The Company's plan to discontinue its Tableware business should not have an
     overall material impact on liquidity. Certain cash proceeds will be
     received from the sale of its Foodservice Division and there will be
     offsetting cash needs related to severance, relocation and other costs of
     discontinuing the Consumer Products Division. The majority of costs related
     to the discontinuation of the Tableware business are non-cash.

     Currency risks related to the Company's Mexican subsidiary are minimal
     except for translation losses as disclosed in Footnote 1.  Monetary
     transactions not in the subsidiary's functional currency are settled in the
     currency of origin thus hedging any exposure to exchange rates.     

     Disclosures Regarding Forward-Looking Statements

     This report on Form 10-Q includes "forward-looking statements" within the
     meaning of Section 27A of the Securities Act of 1933, as amended, and
     Section 21E of the Securities Exchange Act of 1934, as amended. All
     statements other than statements of historical facts included in this Form
     10-Q, including, without limitation, statements contained in this
     "Management's Discussion and Analysis of Financial Condition and Result of
     Operations" regarding the Company's financing alternatives, financial
     position, business strategy, plans and objectives of management of the
     Company for future operations, and industry conditions, are
     forward-looking statements. Although the Company believes that the
     expectations reflected in any such forward-looking statements are
     reasonable, it can give no assurance that such expectations will prove to
     have been correct. Any forward-looking statements herein are subject to
     certain risks and uncertainties in the Company's business, including but
     not limited to, the intense competition in its markets, its recent
     experience of increasing raw material prices, the absence of assurance of
     strategic and financing alternatives, Mexican currency fluctuations and
     its reliance on certain key customers; all of which may be beyond the
     control of the Company. Any one or more of these factors could cause
     actual results to differ materially from those expressed in any forward-
     looking statement. All subsequent written and oral forward-looking
     statements attributable to the Company or person acting on its behalf are
     expressly qualified in their entirety by the cautionary statements
     disclosed in this paragraph and otherwise in this report.





                                       15
<PAGE>   16
                           SUN COAST INDUSTRIES, INC.
                               SEPTEMBER 30, 1996

PART II - OTHER INFORMATION

     Item 1 - Legal Proceedings

     None.

     Item 2 - Changes in Securities

     None.

     Item 3 - Defaults Upon Senior Securities

     None.

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

     None.

     Item 5 - Other Information

     Item 6 - Exhibits and Reports in Form 8K

        (a)   Exhibits:

       10.1   Financing Agreement between the Company and The CIT
              Group/Business Credit, Inc. dated January 31, 1997.  

       27     Financial Data Schedule





                                       16
<PAGE>   17
                                   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.

                         Sun Coast Industries, Inc.
                         ------------------------------------------------------
                         Registrant

2/14/97                  By:
--------                     --------------------------------------------------
 Date                        Eddie Lesok, Chief Executive Officer and President

2/14/97                  By:
--------                     --------------------------------------------------
 Date                        Cynthia R. Morris, CFO, Secretary and Treasurer



                                       17
<PAGE>   18
                              INDEX TO EXHIBITS



<TABLE>
<CAPTION>
EXHIBIT
NUMBER                   DESCRIPTION
-------                  -----------
<S>           <C>
  10.1        -  Finance Agreement
  27          -  Financial Data Schedule

</TABLE>