<PAGE>   1

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

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

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

                                   FORM 10-Q

<TABLE>
<C>               <S>
   (MARK ONE)
      [X]         QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF
                  THE SECURITIES EXCHANGE ACT OF 1934
                  FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2000
                                      OR
      [  ]        TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF
                  THE SECURITIES EXCHANGE ACT OF 1934
                  FOR THE TRANSITION PERIOD FROM ____________ TO ____________
</TABLE>

                        COMMISSION FILE NUMBER: 0-20646

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

                           CARAUSTAR INDUSTRIES, INC.
             (Exact name of registrant as specified in its charter)

<TABLE>
<S>                                        <C>
              NORTH CAROLINA                               58-1388387
     (State or other jurisdiction of                    (I.R.S. Employer
      incorporation or organization)                 Identification Number)

 3100 JOE JERKINS BLVD., AUSTELL, GEORGIA                    30106
 (Address of principal executive offices)                  (Zip Code)
</TABLE>

                                 (770) 948-3101
              (Registrant's telephone number, including area code)

     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 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 issuer's classes of
common stock, as of the latest practicable date, May 3, 2000.

<TABLE>
<CAPTION>
        COMMON STOCK, $.10 PAR VALUE                                25,765,946
        ----------------------------                                ----------
<S>                                                <C>
                  (Class)                                         (Outstanding)
</TABLE>

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE>   2

FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2000

                           CARAUSTAR INDUSTRIES, INC.

                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                          PAGE
                                                                          ----
<S>         <C>                                                           <C>
PART I --   FINANCIAL INFORMATION
Item 1.     Condensed Consolidated Financial Statements:
            Condensed Consolidated Balance Sheets as of March 31, 2000
              and
            December 31, 1999...........................................    3
            Condensed Consolidated Statements of Income for the
              three-month period
            ended March 31, 2000 and March 31, 1999.....................    4
            Condensed Consolidated Statements of Cash Flows for the
              three-month
            periods ended March 31, 2000 and March 31, 2000.............    5
            Notes to Condensed Consolidated Financial Statements........    6
Item 2.     Management's Discussion and Analysis of Financial Condition
              and Results
            of Operations for the three-month periods ended March 31,
              2000 and
            March 31, 1999..............................................    9
Item 3.     Quantitative and Qualitative Disclosures About Market
              Risk......................................................   14

PART II --  OTHER INFORMATION

Item 4.     Submission of Matters to a vote of Security Holders.........   15
Item 6.     Exhibits and Reports on Form 8-K............................   15
Signatures..............................................................   16
Exhibit Index...........................................................   17
</TABLE>

                                        2
<PAGE>   3

FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2000
PART I, ITEM 1.

                  CARAUSTAR INDUSTRIES, INC. AND SUBSIDIARIES

                     CONDENSED CONSOLIDATED BALANCE SHEETS
                       (IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
                                                               MARCH 31,    DECEMBER 31,
                                                                 2000          1999*
                                                              -----------   ------------
                                                              (UNAUDITED)
<S>                                                           <C>           <C>
                                         ASSETS
CURRENT ASSETS:
  Cash and cash equivalents.................................   $   9,612     $  18,771
  Receivables, net..........................................     117,642       108,819
  Inventories...............................................     101,059        89,770
  Refundable income taxes...................................       4,319         1,985
  Other current assets......................................       8,314         7,777
                                                               ---------     ---------
         Total current assets...............................     240,946       227,122
                                                               ---------     ---------
PROPERTY, PLANT AND EQUIPMENT:
  Land......................................................      12,320        12,312
  Buildings and improvements................................     126,998       125,126
  Machinery and equipment...................................     590,894       580,892
  Furniture and fixtures....................................      11,076         8,984
                                                               ---------     ---------
                                                                 741,288       727,314
  Less accumulated depreciation.............................    (259,826)     (247,458)
                                                               ---------     ---------
  Property, plant and equipment, net........................     481,462       479,856
                                                               ---------     ---------
GOODWILL, net...............................................     146,157       140,763
                                                               ---------     ---------
OTHER ASSETS................................................      30,822        30,902
                                                               ---------     ---------
                                                               $ 899,387     $ 878,643
                                                               =========     =========
                          LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
  Current maturities of long-term debt......................   $  16,598     $  16,615
  Accounts payable..........................................      75,773        62,454
  Accrued liabilities.......................................      55,112        43,755
  Dividends payable.........................................       4,624         4,572
                                                               ---------     ---------
         Total current liabilities..........................     152,107       127,396
                                                               ---------     ---------
REVOLVING CREDIT LOANS......................................     130,000       140,000
                                                               ---------     ---------
LONG-TERM DEBT, less current maturities.....................     269,738       269,739
                                                               ---------     ---------
DEFERRED INCOME TAXES.......................................      53,610        49,153
                                                               ---------     ---------
DEFERRED COMPENSATION.......................................       3,004         3,164
                                                               ---------     ---------
OTHER LIABILITIES...........................................       8,603         9,786
                                                               ---------     ---------
MINORITY INTEREST...........................................       1,022           946
                                                               ---------     ---------
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY:
  Preferred stock, $.10 par value; 5,000,000 shares
    authorized; none issued.................................           0             0
  Common stock, $.10 par value; 60,000,000 shares
    authorized, 25,763,026 and 25,488,280 shares issued and
    outstanding at March 31, 2000 and December 31, 1999,
    respectively............................................       2,576         2,549
  Additional paid-in capital................................     154,864       149,509
  Retained earnings.........................................     124,440       126,935
  Accumulated other comprehensive income....................        (577)         (534)
                                                               ---------     ---------
                                                                 281,303       278,459
                                                               ---------     ---------
                                                               $ 899,387     $ 878,643
                                                               =========     =========
</TABLE>

---------------
* Condensed from audited financial statements.

The accompanying notes are an integral part of these condensed consolidated
balance sheets.

                                        3
<PAGE>   4

FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2000
PART I, ITEM 1.

                  CARAUSTAR INDUSTRIES, INC. AND SUBSIDIARIES

                  CONDENSED CONSOLIDATED STATEMENTS OF INCOME

                     (IN THOUSANDS, EXCEPT PER SHARE DATA)

<TABLE>
<CAPTION>
                                                              THREE MONTHS ENDED
                                                                   MARCH 31,
                                                              -------------------
                                                                2000       1999
                                                              --------   --------
                                                                  (UNAUDITED)
<S>                                                           <C>        <C>
SALES.......................................................  $260,850   $197,412
FREIGHT.....................................................    12,297      9,847
                                                              --------   --------
          Net sales.........................................   248,553    187,565
COST OF SALES...............................................   194,416    138,789
                                                              --------   --------
          Gross profit......................................    54,137     48,776
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES................    38,490     28,470
RESTRUCTURING COSTS.........................................     6,913          0
                                                              --------   --------
          Operating income..................................     8,734     20,306
OTHER (EXPENSE) INCOME:
  Interest expense..........................................    (7,787)    (4,071)
  Interest income...........................................       174        119
  Equity in income of unconsolidated affiliates.............     2,910      1,830
  Other, net................................................       (68)      (132)
                                                              --------   --------
                                                                (4,771)    (2,254)
                                                              --------   --------
INCOME BEFORE INCOME TAXES AND MINORITY INTEREST............     3,963     18,052
MINORITY INTEREST...........................................       (75)      (118)
PROVISION FOR INCOME TAXES..................................     1,746      6,519
                                                              --------   --------
NET INCOME..................................................  $  2,142   $ 11,415
                                                              ========   ========
BASIC
NET INCOME PER COMMON SHARE.................................  $   0.08   $   0.46
                                                              ========   ========
Weighted average number of shares outstanding...............    25,624     24,759
                                                              ========   ========
DILUTED
NET INCOME PER COMMON SHARE.................................  $   0.08   $   0.46
                                                              ========   ========
Diluted weighted average number of shares outstanding.......    25,649     24,910
                                                              ========   ========
</TABLE>

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

                                        4
<PAGE>   5

FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2000
PART I, ITEM 1.

                  CARAUSTAR INDUSTRIES, INC. AND SUBSIDIARIES

                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                              THREE MONTHS ENDED
                                                                   MARCH 31,
                                                              -------------------
                                                                2000       1999
                                                              --------   --------
                                                                  (UNAUDITED)
<S>                                                           <C>        <C>
Cash provided by (used in)
  Operating activities:
     Net income.............................................  $  2,142   $ 11,415
     Depreciation and amortization..........................    14,858     10,186
     Restructuring costs....................................     5,696          0
     Other noncash adjustments..............................       445       (596)
     Changes in current assets and liabilities..............     1,284     (1,381)
                                                              --------   --------
          Net cash provided by operating activities.........    24,425     19,624
                                                              --------   --------
  Investing activities:
     Purchases of property, plant and equipment.............   (17,151)    (8,810)
     Acquisitions of businesses, net of cash acquired.......    (4,071)         0
     Other..................................................     2,380      1,163
                                                              --------   --------
          Net cash used in investing activities.............   (18,842)    (7,647)
                                                              --------   --------
  Financing activities:
     Proceeds from revolving credit loans...................     4,000     14,000
     Repayments of revolving credit loans...................   (14,000)   (12,000)
     Repayments of long-term debt...........................       (42)       (28)
     Dividends paid.........................................    (4,570)    (4,476)
     Proceeds from issuances of stock.......................        86        443
     Other..................................................      (216)      (215)
                                                              --------   --------
          Net cash used in financing activities.............   (14,742)    (2,276)
                                                              --------   --------
Net (decrease) increase in cash and cash equivalents........    (9,159)     9,701
Cash and cash equivalents at beginning of period............    18,771      2,610
                                                              --------   --------
Cash and cash equivalents at end of period..................  $  9,612   $ 12,311
                                                              ========   ========
Supplemental Disclosures:
  Cash payments for interest................................  $  1,822   $  2,089
                                                              ========   ========
  Cash payments for income taxes............................  $    935   $  1,732
                                                              ========   ========
  Stock issued for acquisitions.............................  $  5,303   $  5,991
                                                              ========   ========
</TABLE>

The accompanying notes are an integral part of these condensed consolidated
statements of cash flows.

                                        5
<PAGE>   6

FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2000
PART I, ITEM 1.

                           CARAUSTAR INDUSTRIES, INC.

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                 MARCH 31, 2000
                                  (UNAUDITED)

NOTE 1.  BASIS OF PRESENTATION

         The financial information included herein is unaudited; however, such
         information reflects all adjustments (consisting of normal recurring
         adjustments) which are, in the opinion of management, necessary for a
         fair statement of results for the interim periods. The results of
         operations for the three months ended March 31, 2000 are not
         necessarily indicative of the results to be expected for the full year.

NOTE 2.  ACQUISITION

         The following acquisition is being accounted for under the purchase
         method of accounting, applying the provisions of Accounting Principles
         Board Opinion No. 16. As a result, the Company records the assets and
         liabilities of the acquired company at its estimated fair value with
         the excess of the purchase price over this amount being recorded as
         goodwill. Actual allocations of goodwill and other identifiable assets
         will be based on further studies and may change during the allocation
         period, generally one year following the date of acquisition.

         In February 2000, the Company acquired all of the outstanding stock of
         MilPak, Inc. in exchange for 244,422 shares of the Company's common
         stock valued at $4.7 million and $4.7 million in cash. MilPak operates
         a facility located in Pine Brook, New Jersey that provides blister
         packaging, cartoning and labeling, and other contract packaging
         services. Goodwill of approximately $6.0 million was recorded in
         connection with the acquisition and is being amortized over 40 years.

NOTE 3.  COMPREHENSIVE INCOME

         Total comprehensive income, consisting of net income plus other
         nonowner changes in equity, for the three months ended March 31, 2000
         and 1999 was $2,099,000 and $11,314,000, respectively.

NOTE 4.  NEW ACCOUNTING PRONOUNCEMENT

         In June 1998, the Financial Accounting Standards Board ("FASB") issued
         Statement of Financial Accounting Standards ("SFAS") No. 133,
         "Accounting for Derivative Instruments and Hedging Activities." SFAS
         No. 133 established accounting and reporting standards for derivative
         instruments, including certain derivative instruments embedded in other
         contracts (collectively referred to as derivatives), and for hedging
         activities. It also requires that an entity recognize all derivatives
         as either assets or liabilities in the statement of financial position
         and measure those instruments at fair value. In June 1999, the FASB
         issued SFAS No. 137 "Accounting for Derivative Instruments and Hedging
         Activities -- Deferral of the Effective Date of FASB Statement 133."
         This statement defers the effective date of SFAS No. 133 until the
         fiscal year ending December 31, 2001. Management does not expect SFAS
         No. 133 to have a significant impact on the Company's financial
         statements.

NOTE 5.  SEGMENT INFORMATION

        The Company operates principally in three business segments organized by
         products. The paperboard segment consists of facilities that
         manufacture 100 percent recycled uncoated and clay-

                                        6
<PAGE>   7
FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2000
PART I, ITEM 1.

         coated paperboard and facilities that collect recycled paper and broker
         recycled paper and other paper rolls. The tube, core and composite
         container segment is principally made up of facilities that produce
         spiral and convolute-wound tubes, cores and cans. The carton and custom
         packaging segment consists of facilities that produce printed and
         unprinted folding and set-up cartons and facilities that provide
         contract manufacturing and contract packaging services. Intersegment
         sales are recorded at prices which approximate market prices. Operating
         income includes all costs and expenses directly related to the segment
         involved. Corporate expenses include corporate general, administrative
         and unallocated information systems expenses.

         The following table presents certain business segment information for
         the periods indicated (in thousands):

<TABLE>
<CAPTION>
                                                                            THREE MONTHS
                                                                           ENDED MARCH 31,
                                                                         -------------------
                                                                           2000       1999
                                                                         --------   --------
           <S>                                                           <C>        <C>
           Net sales (external customers):
             Paperboard................................................  $107,078   $ 75,102
             Tube, core and composite container........................    64,981     63,894
             Carton and custom packaging...............................    76,494     48,569
                                                                         --------   --------
                     Total.............................................  $248,553   $187,565
                                                                         ========   ========
           Net sales (intersegment):
             Paperboard................................................  $ 33,329   $ 27,683
             Tube, core and composite container........................     1,046        664
             Carton and custom packaging...............................       167         70
                                                                         --------   --------
                     Total.............................................  $ 34,542   $ 28,417
                                                                         ========   ========
           Operating income:
             Paperboard(A).............................................  $  5,074   $ 15,015
             Tube, core and composite container........................     4,387      5,275
             Carton and custom packaging...............................     2,519      2,907
                                                                         --------   --------
                     Total.............................................    11,980     23,197
           Corporate expense...........................................    (3,246)    (2,891)
                                                                         --------   --------
           Operating income............................................     8,734     20,306
             Interest expense..........................................    (7,787)    (4,071)
             Interest income...........................................       174        119
             Equity in income of unconsolidated affiliates.............     2,910      1,830
             Other (net)...............................................       (68)      (132)
                                                                         --------   --------
           Income before income taxes and minority interest............  $  3,963   $ 18,052
                                                                         ========   ========
</TABLE>

---------------
          (A) During the first quarter of 2000, the Company recorded a charge to
              operations of approximately $6.9 million related to the closing of
              its Baltimore, Maryland paperboard mill (see Note 6). These costs
              were related to the paperboard segment and are reflected in the
              segment's operating income.

NOTE 6.  RESTRUCTURING COSTS

        In February 2000, the Company initiated a plan to close its paperboard
         mill located in Baltimore, Maryland and recorded a charge to operations
         of approximately $6.9 million. The plan to close the mill was adopted
         in conjunction with the Company's ongoing efforts to increase
         manufacturing efficiency and reduce costs in its mill system. The $6.9
         million charge included a $5.7 million

                                        7
<PAGE>   8
FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2000
PART I, ITEM 1.

         noncash asset impairment charge to write-down machinery and equipment
         to net realizable value. The charge also included a $604 thousand
         accrual for severance and termination benefits for 21 salaried and 83
         hourly employees terminated in connection with this plan and a $613
         thousand accrual for post-closing security, utilities and other exit
         costs. As of March 31, 2000, eight employees remained to market the
         land and building, sell remaining inventory, collect receivables and
         provide human resources services to terminated employees. The Company
         has received a deposit from a potential buyer of the land and building
         and expects to close the sale and complete the exit plan in the third
         quarter of 2000. The remaining severance and termination benefits will
         be paid by August 31, 2000.

          The following is a summary of restructuring activity from plan
          adoption to March 31, 2000 (unaudited):

<TABLE>
<CAPTION>
                                                                 SEVERANCE AND
                                                                     OTHER
                                                      ASSET       TERMINATION    OTHER EXIT
                                                    IMPAIRMENT     BENEFITS        COSTS        TOTAL
                                                    ----------   -------------   ----------   ----------
           <S>                                      <C>          <C>             <C>          <C>
           First quarter 2000 provision...........  $5,696,000     $ 604,000     $ 613,000    $6,913,000
             Noncash..............................   5,696,000             0             0     5,696,000
                                                    ----------     ---------     ---------    ----------
             Cash.................................           0       604,000       613,000     1,217,000
           First quarter 2000 cash activity.......           0      (275,000)     (204,000)     (479,000)
                                                    ----------     ---------     ---------    ----------
           Balance as of March 31, 2000...........  $        0     $ 329,000     $ 409,000    $  738,000
                                                    ==========     =========     =========    ==========
</TABLE>

NOTE 7.  COMMITMENTS AND CONTINGENCIES

         The Company is involved in certain litigation arising in the ordinary
         course of business. In the opinion of management, the ultimate
         resolution of these matters will not have a material adverse effect on
         the Company's financial condition or results of operations.

                                        8
<PAGE>   9

FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2000
PART I, ITEM 2.

                           CARAUSTAR INDUSTRIES, INC.

          MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                           AND RESULTS OF OPERATIONS

The following is management's discussion and analysis of certain significant
factors which have affected the Company's financial condition and operating
results during the periods included in the accompanying condensed consolidated
financial statements.

GENERAL

The Company is a major manufacturer of recycled paperboard and converted
paperboard products, operating principally in three business segments. The
paperboard segment consists of facilities that manufacture 100 percent recycled
uncoated and clay-coated paperboard and facilities that collect recycled paper
and broker recycled paper and other paper rolls. The tube, core and composite
container segment is principally made up of facilities that produce spiral and
convolute-wound tubes, cores and cans. The carton and custom packaging segment
consists of facilities that produce printed and unprinted folding and set-up
cartons and facilities that provide contract manufacturing and contract
packaging services.

The Company is vertically integrated to the extent that a large portion of its
paperboard production is consumed internally by its converting segments
(approximately 37 percent in the first quarter of 2000). As part of its strategy
to optimize capacity utilization, the Company regularly purchases paperboard
from other manufacturers in an effort to minimize the potential impact of demand
declines on the Company's own mill system. Additionally, each of the Company's
mills can produce recycled paperboard for more than one end-use product market,
which allows it to shift production between mills in response to customer or
market demands. The Company is also the only major manufacturer to serve all
four recycled boxboard end-use markets: tube and core, folding carton, gypsum
wallboard facing paper and other specialty.

Recovered fiber, which is derived from recycled paper stock, is the Company's
only significant raw material. Historically, the cost of recovered fiber has
fluctuated significantly due to market and industry conditions. For example, the
Company's average recovered fiber cost per ton of paperboard produced increased
from $43 per ton in 1993 to $144 per ton in 1995, an increase of 235 percent,
before dropping to $66 per ton in 1996. Recovered fiber cost per ton averaged
$78 during 1999 and $102 during the first quarter of 2000. Although the Company
raises its selling prices in response to increases in raw material costs, it
often is unable to maintain its operating margins in the face of dramatic cost
increases, and it experiences short-term margin shrinkage during all periods of
price increases due to customary time lags in the implementation of price
increases. There can be no assurance that the Company will be able to recoup any
future increases in the cost of recovered fiber by raising the prices of its
products. There also can be no assurance that, even if the Company is able to
recoup such cost increases, its operating margins and results of operations will
not be materially and adversely affected by time delays in the implementation of
price increases.

                                        9
<PAGE>   10
FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2000
PART I, ITEM 2.

THREE MONTHS ENDED MARCH 31, 2000 AND 1999

The following tables set forth certain operating data regarding the Company's
volume and gross paper margins for the periods indicated. The volume information
shown below includes shipments of unconverted paperboard and converted
paperboard products. Tonnage volumes from the Company's business segments are
combined and presented along end-use market lines. Net sales and operating
income are reported by segment in Note 5 to the consolidated financial
statements as part of Part 1, Item 1 of this report.

<TABLE>
<CAPTION>
                                                               THREE MONTHS
                                                                   ENDED
                                                                 MARCH 31,
                                                              ---------------              %
                                                               2000     1999    CHANGE   CHANGE
                                                              ------   ------   ------   ------
<S>                                                           <C>      <C>      <C>      <C>
Production source of paperboard tons sold (in thousands):
  From paperboard mill production...........................   269.9    227.8    42.1      18.5%
  Outside purchases.........................................    31.6     16.8    14.8      88.1%
                                                              ------   ------   -----
          Total paperboard tonnage..........................   301.5    244.6    56.9      23.3%
                                                              ======   ======   =====
  Tons sold by market (in thousands):
  Tube, core and can volume
     Paperboard (internal)..................................    49.7     50.6    (0.9)     -1.8%
     Outside purchases......................................     5.9      4.4     1.5      34.1%
                                                              ------   ------   -----
  Tube, core and can converted products.....................    55.6     55.0     0.6       1.1%
  Unconverted paperboard....................................     9.3     11.6    (2.3)    -19.8%
                                                              ------   ------   -----
          Tube, core and can volume.........................    64.9     66.6    (1.7)     -2.6%
  Folding carton volume
     Paperboard (internal)..................................    19.3     13.8     5.5      39.9%
     Outside purchases......................................    23.2     10.2    13.0     127.5%
                                                              ------   ------   -----
  Folding carton converted products.........................    42.5     24.0    18.5      77.1%
  Unconverted paperboard....................................    74.9     48.9    26.0      53.2%
                                                              ------   ------   -----
          Folding carton volume.............................   117.4     72.9    44.5      61.0%
  Gypsum facing paper volume
     Unconverted paperboard.................................    54.7     59.0    (4.3)     -7.3%
     Outside purchases (for resale).........................     0.5      0.5     0.0       0.0%
                                                              ------   ------   -----
          Gypsum facing volume..............................    55.2     59.5    (4.3)     -7.2%
  Other specialty volume
     Paperboard (internal)..................................    32.1     19.8    12.3      62.1%
     Outside purchases......................................     2.0      1.7     0.3      17.6%
                                                              ------   ------   -----
  Other specialty converted products........................    34.1     21.5    12.6      58.6%
  Unconverted paperboard....................................    29.9     24.1     5.8      24.1%
                                                              ------   ------   -----
          Other specialty volume............................    64.0     45.6    18.4      40.4%
                                                              ------   ------   -----
          Total paperboard tonnage..........................   301.5    244.6    56.9      23.3%
                                                              ======   ======   =====
Gross paper margins ($/ton):
  Paperboard mill:
     Average same-mill net selling price....................  $  442   $  402   $  40      10.0%
     Average same-mill recovered fiber cost.................     102       61      41      67.2%
                                                              ------   ------   -----
          Paperboard mill gross paper margin................  $  340   $  341   $  (1)     -0.3%
                                                              ======   ======   =====
  Tube and core:
     Average net selling price..............................  $  762   $  711   $  51       7.2%
     Average paperboard cost................................     420      382      38       9.9%
                                                              ------   ------   -----
          Tube and core gross paper margin..................  $  342   $  329   $  13       4.0%
                                                              ======   ======   =====
</TABLE>

                                       10
<PAGE>   11
FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2000
PART I, ITEM 2.

Consolidated net sales for the quarter ended March 31, 2000 increased 32.5
percent to $248.6 million from $187.6 million in 1999. Acquisitions accounted
for $51.5 million of sales during the first quarter of 2000. Excluding
acquisitions, net sales increased 5.1 percent. This increase was primarily due
to higher selling prices in the paperboard segment and higher sales from the
tube, core and composite container and carton and custom packaging segments.

Total paperboard tonnage for the quarter increased 23.3 percent to 301.5
thousand tons from 244.6 thousand tons. Excluding acquisitions, total paperboard
tonnage increased 2.2 percent to 249.9 thousand tons. This increase was the
result of higher shipments of converted products, primarily other specialty
converted products and folding cartons, partially offset by lower shipments of
unconverted paperboard to external customers in the gypsum facing paper and tube
and core end-use markets. Excluding acquisitions, outside purchases increased
24.4 percent to 20.9 thousand tons. Tons sold from paperboard mill production
increased 18.5 percent for the quarter to 269.9 thousand tons compared with
227.8 thousand tons in the first quarter last year, but decreased 0.6 percent
excluding the Sprague and Halifax acquisitions. Total tonnage converted
increased 31.5 percent in the first quarter of 2000 to 132.2 thousand tons
versus 100.5 thousand tons in 1999 and increased 7.2 percent excluding
acquisitions. Excluding acquisitions, volumes in the folding carton and other
specialty end-use markets increased 3.0 percent and 19.7 percent, respectively.

Gross margin for the first quarter of 2000 decreased to 21.8 percent of net
sales from 26.0 percent in 1999. This margin decrease was due primarily to the
acquisition of operations with lower margins, as a percent of sales, than the
Company's other operations.

In February 2000, the Company initiated a plan to close its paperboard mill
located in Baltimore, Maryland and recorded a charge to operations of
approximately $6.9 million. The plan to close the mill was adopted in
conjunction with the Company's ongoing efforts to increase manufacturing
efficiency and reduce costs in its mill system. The $6.9 million charge included
a $5.7 million noncash asset impairment charge to write-down machinery and
equipment to net realizable value. The charge also included a $604 thousand
accrual for severance and termination benefits for 21 salaried and 83 hourly
employees terminated in connection with this plan and a $613 thousand accrual
for post-closing security, utilities and other exit costs. In the first quarter
of 2000, the Company paid $275 thousand in severance and termination benefits
and paid $204 thousand in other exit costs. As of March 31, 2000, eight
employees remained to market the land and building, sell remaining inventory,
collect receivables and provide human resources services to terminated
employees. The Company has received a deposit from a potential buyer of the land
and building and expects to close the sale and complete the exit plan in the
third quarter of 2000. The remaining severance and termination benefits will be
paid by August 31, 2000. The Company does not expect the mill closure to have a
material impact on future operations.

Operating income for the first quarter of 2000 was $8.7 million, a decrease of
$11.6 million, or 57.0 percent from the first quarter of 1999. Operating income
for comparable facilities and excluding restructuring costs increased 1.0
percent over the prior year. This increase was the result of improved operating
income from the paperboard segment's recovered fiber operations, partially
offset by lower operating income from the tube, core and composite container and
the carton and custom packaging segments. Selling, general and administrative
expenses increased $10.0 million in the first quarter of 2000 versus 1999 due
primarily to acquisitions and higher information technology costs.

Interest expense increased 91.3 percent to $7.8 million for the first quarter of
2000 from $4.1 million in 1999. This increase was primarily due to the June 1,
1999 public debt securities offering and higher interest rates on the revolving
credit facility, partially offset by lower average borrowings under the
revolving credit facility.

Equity income from unconsolidated affiliates for the first quarter of 2000 was
$2.9 million, up 59.0 percent from 1999 due to improved results for the
Company's gypsum wallboard joint venture with Temple-Inland. The joint venture
realized a significant contribution from the new wallboard plant located in
Cumberland City, Tennessee, which began operations in the fourth quarter of
1999.
                                       11
<PAGE>   12
FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2000
PART I, ITEM 2.

As discussed above, results for the first quarter of 2000 included a
nonrecurring restructuring charge recorded in conjunction with the closing of
the Company's Baltimore, Maryland paperboard mill of $6.9 million ($4.3 million,
net of tax benefit, or $0.17 per common share on a diluted basis). Excluding
this charge, net income was $6.5 million, or $0.25 per common share. Including
the restructuring charge, net income decreased 81.2 percent to $2.1 million in
the first quarter of 2000 from $11.4 million last year. Diluted net income per
common share, including the restructuring charge, decreased 82.6 percent to
$0.08 for the first quarter of 2000 from $0.46 in the same period of 1999.

LIQUIDITY AND CAPITAL RESOURCES

On March 31, 2000, the Company had loans of $130.0 million outstanding under its
revolving credit facility versus $149.0 million on March 31, 1999 and $140.0
million on December 31, 1999. Loans under the revolving credit facility bear
interest, payable monthly, at the Eurodollar rate plus a margin based upon the
Company's investment grade rating, as defined in the revolving credit agreement.
For the three months ended March 31, 2000 and 1999 and for the year ended
December 31, 1999, the weighted average borrowings outstanding under the
revolving credit facility during such periods bore interest at 6.45 percent,
5.37 percent and 5.44 percent, respectively. Other long-term debt consisted of
the following (in thousands):

<TABLE>
<CAPTION>
                                                                  MARCH 31,        DECEMBER 31,
                                                              ------------------   ------------
                                                                2000      1999         1999
                                                              --------   -------   ------------
<S>                                                           <C>        <C>       <C>
7.375 percent 10-year notes.................................  $198,667   $    --     $198,691
7.74 percent senior notes...................................    82,750    82,750       82,750
Other notes payable.........................................     4,919       206        4,913
                                                              --------   -------     --------
                                                               286,336    82,956      286,354
Less current maturities.....................................    16,598       103       16,615
                                                              --------   -------     --------
                                                              $269,738   $82,853     $269,739
                                                              ========   =======     ========
</TABLE>

In 1998, the Company registered with the Securities and Exchange Commission a
total of $300 million in public debt securities for issuance in one or more
series and with such specific terms as to be determined from time to time. On
June 1, 1999, the Company issued $200 million in aggregate principal amount of
its 7.375 percent notes due June 1, 2009. The 7.375 percent notes were issued at
a discount to yield an effective interest rate of 7.473 percent, are unsecured
obligations of the Company and pay interest semiannually.

The Company has a $400 million, five-year bank revolving credit facility which
may be increased up to $500 million and its maturity extended by up to three
additional years beyond the second quarter of 2002, subject to certain
conditions and approvals. The Company can use the facility to fund ongoing
working capital needs and for general corporate purposes, including
acquisitions. Interest under the facility is computed using the Company's choice
of: (a) the Eurodollar rate plus a margin; or (b) the higher of the Federal
Funds Rate plus a margin or the bank's prime lending rate. The Company can also
choose the basis for determining the margin above the Eurodollar rate as either:
(a) its consolidated leverage ratio; or (b) its investment grade rating. The
revolving credit agreement contains certain restrictive covenants regarding,
among other matters, the incurrence of additional indebtedness and the
maintenance of certain leverage and interest coverage ratios, as defined in the
agreement.

Cash generated from operations was $24.4 million for the three months ended
March 31, 2000 compared with $19.6 million for the same period last year. The
increase in the first quarter of 2000 compared to the same period last year was
due primarily to favorable changes in working capital, partially offset by lower
net income.

Capital expenditures, excluding acquisitions, were $17.2 million in the first
three months of 2000 versus $8.8 million for the same period last year.
Aggregate capital expenditures of approximately $41.9 million are anticipated
for 2000.

                                       12
<PAGE>   13
FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2000
PART I, ITEM 2.

In February 2000, the Company acquired all of the outstanding stock of MilPak,
Inc. in exchange for 244,422 shares of the Company's common stock valued at $4.7
million and $4.7 million in cash. MilPak operates a facility located in Pine
Brook, New Jersey that provides blister packaging, cartoning and labeling, and
other contract packaging services.

Cash dividends of $4.6 million were paid in the first three months of 2000
versus $4.5 million in the same period last year. The Company's debt agreements
contain no specific limitations on the payment of dividends.

The Company did not purchase any shares of its common stock during the first
three months of 2000 pursuant to its common stock purchase plan. The Company has
cumulatively purchased 3,169,000 shares since January 1996. The Company's board
of directors has authorized purchases of up to 831,000 additional shares, and
the Company intends to continue such purchases, subject to market conditions and
availability, but there can be no assurance as to the completion, timing or
prices of such future purchases.

During the second quarter of 1999, the Company formed a joint venture with
Temple-Inland Inc. to own and operate Temple's Newport, Indiana containerboard
mill. The joint venture, Premier Boxboard Limited LLC ("PBL"), is undertaking a
14-month, $75 million project to modify the mill to enable it to produce a new,
lightweight gypsum facing paper along with other containerboard grades. The mill
is anticipated to begin operations as modified in the third quarter of 2000.
Under the joint venture agreement, the Company will contribute $50 million to
the joint venture during the second quarter of 2000 and Temple will contribute
the net assets of the mill. Each partner will have a 50 percent interest in the
joint venture.

The Company anticipates that it will be able to meet its funding needs for the
possible acquisition of additional facilities, the investment in PBL, working
capital, capital expenditures and additional stock purchases through internally
generated cash and borrowings under its revolving credit facility and the
issuance of debt securities in the public markets.

FORWARD-LOOKING INFORMATION

This Report on Form 10-Q, including "Management's Discussion and Analysis of
Financial Condition and Results of Operations," may contain various
"forward-looking statements," within the meaning of Section 21E of the
Securities Exchange Act of 1934, that are based on management's belief and
assumptions, as well as information currently available to management. When used
in this document, the words "anticipate," "estimate," "expect," and similar
expressions may identify 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 be
correct. Any such statements are subject to certain risks, uncertainties and
assumptions. Should one or more of these risks or uncertainties materialize, or
should underlying assumptions prove incorrect, the Company's actual financial
results, performance or condition may vary materially from those anticipated,
estimated or expected. Among the key factors that may have a direct bearing on
the Company's actual financial results, performance or condition are
fluctuations in raw material prices and the economy in general, the degree and
nature of competition, demand for the Company's products, changes in government
regulations, the Company's ability to complete acquisitions and integrate the
operations of acquired businesses, and other matters discussed in this report
and the Company's other filings with the Securities and Exchange Commission.

                                       13
<PAGE>   14

FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2000
PART I, ITEM 3.

                           CARAUSTAR INDUSTRIES, INC.

           QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

For a discussion of certain market risks related to the Company, see Part II,
Item 7A, "Quantitative and Qualitative Disclosures about Market Risk", in the
Company's Annual Report on Form 10-K for the fiscal year ended December 31,
1999. There have been no significant developments with respect to the Company's
exposure to interest rate market risk.

                                       14
<PAGE>   15

FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2000
PART II, ITEM 4.

                           PART II. OTHER INFORMATION

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

The Company's annual shareholders' meeting was held on April 19, 2000. The
matters voted upon at the meeting were (1) a proposal to elect three Class II
directors (Bob M. Prillaman, Russell M. Robinson, II and H. Lee Thrash, III) (2)
a proposal to ratify the amendment to the Company's 1998 Key Employee Incentive
Compensation Plan as described in the Company's Proxy Statement and (3) a
proposal to ratify the selection of Arthur Andersen LLP as the Company's
independent public accountants for fiscal 2000. Proposals (1), (2) and (3) were
approved by the following margins:

<TABLE>
<CAPTION>
                                                      VOTES AGAINST OR                  BROKER
PROPOSAL                                 VOTES FOR        WITHHELD       ABSTENTIONS   NONVOTES
--------                                 ----------   ----------------   -----------   ---------
<S>                                      <C>          <C>                <C>           <C>
Election of Directors
  Bob M. Prillaman.....................  19,673,710        853,335              0              0
  Russell M. Robinson, II..............  19,292,688      1,234,357              0              0
  H. Lee Thrash, III...................  19,141,404      1,385,641              0              0
Ratification of Amendment to 1998 Key
  Employee Incentive Compensation
  Plan.................................  15,784,420      2,368,377         48,537      2,325,711
Ratification of Selection of
  Independent Public Accountants.......  20,437,012         33,453         56,580              0
</TABLE>

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits

The Exhibits to this Report on Form 10-Q are listed in the accompanying Exhibit
Index.

(b) Reports on Form 8-K

During the quarter ended March 31, 2000, the Company filed one current report on
Form 8-K. This report, dated March 20, 2000, incorporated by reference the
contents of a Company press release stating the Company's expectations regarding
its operating results for the quarter ended March 31, 2000.

                                       15
<PAGE>   16

FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2000

                                   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.

                                          CARAUSTAR INDUSTRIES, INC.

                                          By:    /s/ H. LEE THRASH, III
                                            ------------------------------------
                                                     H. Lee Thrash, III
                                             Vice President and Chief Financial
                                                           Officer
                                            (Principal Financial and Accounting
                                                           Officer)

Dated: May 12, 2000

                                       16
<PAGE>   17
FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2000

                                 EXHIBIT INDEX

<TABLE>
<CAPTION>
EXHIBIT
  NO.    DESCRIPTION
-------  -----------
<S>      <C>
 3.01    Amended and Restated Articles of Incorporation of the
         Company (Incorporated by reference -- Exhibit 3.01 to Annual
         Report for 1992 on Form 10-K [SEC File No. 0-20646])
 3.02    Second Amended and Restated Bylaws of the Company
         (Incorporated by reference -- Exhibit 3.02 to Registration
         Statement on Form S-4 [SEC File No. 333-29937])
 4.01    Specimen Common Stock Certificate (Incorporated by
         reference -- Exhibit 4.01 to Registration Statement on Form
         S-1 [SEC File No. 33-50582])
 4.02    Articles 3 and 4 of the Company's Amended and Restated
         Articles of Incorporation (included in Exhibit 3.01)
 4.03    Article II of the Company's Second Amended and Restated
         Bylaws (included in Exhibit 3.02)
 4.04    Amended and Restated Rights Agreement, dated as of May 24,
         1999, between Caraustar Industries, Inc. and The Bank of New
         York as Rights Agent (Incorporated by reference -- Exhibit
         10.1 to current report on Form 8-K dated June 1, 1999 [SEC
         File No. 020646])
 4.05    Indenture, dated as of June 1, 1999, between Caraustar
         Industries, Inc. and The Bank of New York, as Trustee
         (Incorporated by reference -- Exhibit 4.05 to report on Form
         10-Q for the quarter ended June 30, 1999 [SEC File No.
         0-20646])
 4.06    First Supplemental Indenture, dated as of June 1, 1999,
         between Caraustar Industries, Inc. and The Bank of New York,
         as Trustee (Incorporated by reference -- Exhibit 4.06 to
         report on Form 10-Q for the quarter ended June 30, 1999 [SEC
         File No. 0-20646])
10.01    Note Agreement, dated as of October 1, 1992, between the
         Company and the Prudential Insurance Company of America,
         regarding the Company's 7.89% Senior Subordinated Notes
         (Incorporated by reference -- Exhibit 10.02 to Annual Report
         for 1992 on Form 10-K [SEC File No. 0-20646])
10.02    Amendment Agreement, dated as of June 2, 1995, between the
         Company and the Prudential Insurance Company of America
         regarding the Company's 7.89% Senior Subordinated Notes
         (Incorporated by reference -- Exhibit 10.03 to report on
         Form 10-Q for the quarter ended September 30, 1995 [SEC File
         No. 0-20646])
10.03    Amendment Agreement, dated as of July 23, 1997, between the
         Company and the Prudential Insurance Company of America
         regarding the Company's 7.89% Senior Subordinated Notes
         (Incorporated by reference -- Exhibit 10.03 to report on
         Form 10-Q for the quarter ended June 30, 1997 [SEC File No.
         0-20646])
10.04    Amendment Agreement, dated as of August 12, 1998, between
         the Company and the Prudential Insurance Company of America
         regarding the Company's 7.89% Senior Subordinated Notes
         (Incorporated by reference -- Exhibit 10.04 to report on
         Form 10-Q for the quarter ended September 30, 1998 [SEC File
         No. 0-20646])
10.05    Employment Agreement, dated December 31, 1990, between the
         Company and Thomas V. Brown (Incorporated by
         reference -- Exhibit 10.06 to Registration Statement on Form
         S-1 [SEC File No. 33-50582])
10.06    Asset Purchase Agreement, dated August 7, 1992, between the
         Company and Domtar Gypsum Inc. (Incorporated by
         reference -- Exhibit 10.07 to Registration Statement on Form
         S-1 [SEC File No. 33-50582])
10.07    Deferred Compensation Plan, together with copies of existing
         individual deferred compensation agreements (Incorporated by
         reference -- Exhibit 10.08 to Registration Statement on Form
         S-1 [SEC File No. 33-50582])
</TABLE>

                                       17
<PAGE>   18
FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2000

<TABLE>
<CAPTION>
EXHIBIT
  NO.    DESCRIPTION
-------  -----------
<S>      <C>
10.08    1987 Executive Stock Option Plan (Incorporated by
         reference -- Exhibit 10.09 to Registration Statement on Form
         S-1 [SEC File No. 33-50582])
10.09    1993 Key Employees' Share Ownership Plan (Incorporated by
         reference -- Exhibit 10.10 to Registration Statement on Form
         S-1 [SEC File No. 33-50582])
10.10    Energy Purchase Agreement, dated December 18, 1989, between
         Camden Paperboard Corporation and Camden Cogen, L.P.
         (Incorporated by reference -- Exhibit 10.11 to Registration
         Statement on Form S-1 [SEC File No. 33-50582])
10.11    Incentive Bonus Plan of the Company (Incorporated by
         reference -- Exhibit 10.10 to Annual Report for 1993 on Form
         10-K [SEC File No. 0-20646])
10.12    1996 Director Equity Plan of the Company (Incorporated by
         reference -- Exhibit 10.12 to report on Form 10-Q for the
         quarter ended March 31, 1996 [SEC File No. 0-20646])
10.13    Amendment No. 1 to the Company's 1996 Director Equity Plan,
         dated July 16, 1998 (Incorporated by reference -- Exhibit
         10.2 to Current Report on Form 8-K dated June 1, 1999 [SEC
         File No. 0-20646])
10.14+   1998 Key Employee Incentive Compensation Plan, as amended.
10.15    Credit Agreement, dated as of July 23, 1997, by and among
         the Company, as Borrower, the banks listed therein, Bankers
         Trust Company, as Administrative Agent, NationsBank, N.A.,
         as Syndication Agent, SunTrust Bank, Atlanta, as
         Documentation Agent, First Union National Bank, as Managing
         Agent and each of Credit Lyonnais, The Bank of New York, The
         Bank of Nova Scotia, The Bank of Tokyo -- Mitsubishi, Ltd.,
         and Wachovia Bank, as Co-Agents (Incorporated by
         Reference -- Exhibit 10.13 to report on Form 10-Q for the
         Quarter Ended June 30, 1997 (SEC File No. 0-20646])
10.16    Amendment No. 1 to Credit Agreement, dated as of October 8,
         1997, by and among the Company, as Borrower, the banks
         listed therein, Bankers Trust Company, as Administrative
         Agent, NationsBank, N.A., as Syndication Agent, SunTrust
         Bank, Atlanta, as Documentation Agent, First Union National
         Bank, as Managing Agent and each of Credit Lyonnais, The
         Bank of New York, The Bank of Nova Scotia, The Bank of
         Tokyo -- Mitsubishi, Ltd., and Wachovia Bank, as Co-Agents
         (Incorporated by reference -- Exhibit 10.15 to report on
         Form 10-Q for the quarter ended September 30, 1998 [SEC File
         No. 0-20646])
10.17    Amendment No. 2 to Credit Agreement, dated as of October 30,
         1998, by and among the Company, as Borrower, the banks
         listed therein, Bankers Trust Company, as Administrative
         Agent, NationsBank, N.A., as Syndication Agent, SunTrust
         Bank, Atlanta, as Documentation Agent, First Union National
         Bank, as Managing Agent and each of Credit Lyonnais, The
         Bank of New York, The Bank of Nova Scotia, The Bank of
         Tokyo -- Mitsubishi, Ltd., and Wachovia Bank, as Co-Agents
         (Incorporated by reference -- Exhibit 10.16 to report on
         Form 10-Q for the quarter ended September 30, 1998 [SEC File
         No. 0-20646])
10.18    Asset Purchase Agreement between Caraustar Industries, Inc.,
         Sprague Paperboard, Inc. and International Paper Company,
         dated as of March 4, 1999 (Incorporated by reference --
         Exhibit 10.17 to report on Form 10-Q for the quarter ended
         March 31, 1999 [SEC File No. 0-20646])
11.01+   Computation of Earnings Per Share
27.01+   Financial Data Schedule (For SEC purposes only)
</TABLE>

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

+ Filed herewith

                                       18