Registrant's telephone number, including area code: (330) 673-9511

Number of Common Shares Outstanding as of August 15, 2000: 7,838,857

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 and (2) has been subject to such filing requirements for the past ninety (90) days.  

YES [X]                 NO [   ]

See Notes to Consolidated Financial Statements

See Notes to Consolidated Financial Statements

                See Notes to Consolidated Financial Statements

     Due to the seasonal nature of some of the Companys services, the results of operations for the periods ended July 1, 2000, and July 3, 1999 are not necessarily indicative of the results to be expected for the full year.

     On May 19, 1999, the Registrants board of directors declared a 2 for 1 stock split in the form of a 100% stock dividend on outstanding shares only, to shareholders of record as of June 1, 1999. To effect the stock split, they authorized the retirement of 1,981,894 common shares held in treasury. Per common share amounts have been restated for all periods presented to give retroactive effect to the stock split. Common shares issued have been increased to reflect the 2 fo

NOTE 4.     DIVIDENDS

     On June 10, 2000, the Registrant paid a $.055 per share dividend to all shareholders of record at June 1, 2000. This compares to a $.05 per share dividend paid in the second quarter of 1999. For the six months ended July 1, 2000, the Registrant paid cumulative dividends of $.11 per share to all shareholders of record. This compared to a $.10 cumulative per share dividend paid in the first half of 1999.

     Accrued liabilities consisted of:

     On April 26, 2000, the Registrant entered into a new Revolving Credit Agreement (revolver) with its banks, which permits borrowings, as defined, up to $90,000,000 through April 26, 2003. It provides the Company an option of borrowing funds at either the prime interest rate or rates based on LIBOR plus a margin adjustment ranging from 1.25% to 2.00%. It also includes a commitment fee of between .25% and .50% on the average daily unborrowed commitment. As part of the agreement, the term note was paid off with borrowings under the new facility. The Company also extended the term of its temporary line of credit in the amount of $15,000,000 with its principal bank to May 31, 2001.

     Under the most restrictive covenants of the Revolver, the Company is obligated to maintain a minimum shareholders' equity, as defined, of $45,000,000 plus 30% of annual consolidated earnings for 1998 and 1999 through June 29, 2000; $52,000,000 on June 30, 2000 through December 30, 2000, increased on each December 31 by 30% of annual consolidated earnings; a maximum ratio of funded debt to EBITDA (earnings before interest, taxes, depreciation and amortization) for the most recent four quarters of 3.25 to 1.00 though 12-30-2000, and 3.00 to 1.00 thereafter; and a ratio of EBIT (earnings before interest and taxes) to interest of no less than 2.00 to 1.00 through September 29, 2000; 2.25 to 1.00 through December 30, 2000; 2.75 to 1.00 through March 30, 2001; and 3.00 to 1.00 on March 31 and thereafter.

     The Company was not in compliance with the EBIT to interest ratio covenant at the end of the first and second quarters; it was also not in compliance with the minimum shareholders equity covenant at the end of the second quarter. The banks have waived these respective covenants for the first and second quarters and are in discussions with the Company to adjust the covenant requirements for the balance of 2000. Management anticipates that the covenants will be amended prior to August 21, 2000 to amounts that the Company will meet upon the next quarterly measurement date.

     Total comprehensive earnings for the six-month periods ended July 1, 2000 and July 3, 1999, respectively, was as follows:

     The Company has two primary operating segments which provide a variety of horticultural services to their respective customer groups. Residential and Commercial services provides for the treatment, preservation, maintenance, cultivation, planting and removal of trees, shrubs and other plant life; its services also include the practices of tree surgery, tree feeding, tree spraying and landscaping, as well as the application of fertilizers, herbicides, and insecticides. Ut

     The Companys primary focus in evaluating segment performance is on operating earnings. Corporate expenses are substantially allocated among the operating segments. Identifiable assets are those directly used or generated by each segment, and include accounts receivable, inventory, and property and equipment. Unallocated assets consist principally of corporate facilities, enterprise-wide information systems, cash and cash equivalents, deferred taxes, prepaid expenses, and ot

     Details to Operating Segments are as follows:

     Our operating activities provided $16,703,000 during the first six months of 2000, an increase of $30,028,000 compared to the cash used in 1999. This occurred due to a significant reduction in our accounts receivable, and despite the net loss of $2,370,000 we experienced during the first six months.

     Our loss for the first six months of 2000 of $2,370,000 was $4,152,000 lower than the net earnings of $1,782,000 generated in 1999. This is a continued reflection of the losses being experienced by our Utility services, and are due to several major factors. First, we have experienced a decline in productivity on unit price contracts, particularly those in California. This loss in productivity has been driven by two issues. The first, inclement weather, adversely impac ave been adopted by those customers mainly because they believe they are now largely in compliance with the more stringent line clearance standards promulgated in California several years ago. We are working with our customers to improve our efficiency under these contracts. The second factor influencing our losses in Utility services is the lower pricing that had been negotiated on certain contracts in 1999, as well as reductions in crew counts on certain utility accounts. The third factor was a higher lev ts and where we added crews to existing accounts. Fourth, repair costs increased, mainly due to problems experienced with a certain manufacturers boom. Finally, we incurred a substantial increase in our fuel costs in all of our services; we will be able to seek reimbursement for some of the increased fuel costs on certain utility contracts.

     We have effected a $9,606,000 reduction in accounts receivable during the first six months of 2000, a $35,841,000 improvement when compared to the $26,235,000 increase experienced last year. Moreover, we have been able to reduce days outstanding 27.5 days since July 3, 1999, 29.9 days since December 31, 1999, and 14.5 days since April 1, 2000 to a level of 59.9 days. These reductions continue to result from the intensive collection efforts expended since the latter part of 1999, necessitated by the inordinate buildup in Residential and Commercial accounts receivable related to last year's implementation of our enterprise-wide information system. We are committed to maintaining the intensity of our collection efforts. We are not concerned about the overall collectibility of our accounts and perform ongoing credit evaluations of our customers' financial conditions for collection purposes. When we determine it is necessary, we provide for an allowance for doubtful accounts.

     Accounts payable and accrued liabilities decreased $232,000, a net change of $3,214,000 when compared to last year's increase of $2,982,000. The decrease is mainly attributable to a lower level of accrued compensation and related taxes, a function of reduced incentives based on the losses experienced this year. It is also due to a lower level of accrued payroll taxes in comparison to last year; last years level of accrued payroll taxes were higher due to increased operations incentives and the conversion to our new enterprise-wide system.

     Refundable income taxes increased $336,000, a result of our losses incurred in 2000.

     Our insurance liabilities increased $844,000, $1,063,000 more than the $219,000 reduction we realized last year. In prior years, including last years first quarter, our excess insurer had accelerated claims payments to "catch up" in its processing, whereas in the current year those claims payments have leveled off.

     Investing activities used $12,331,000, $2,116,000 less than in 1999, and consistent with our budget for capital expenditures of approximately $23,500,000.

     Our success in reducing accounts receivable allowed us to also significantly reduce our borrowings in the first six months of 2000. Those borrowings, net of payments, totaled only $2,364,000, $25,994,000 less than last years amount of $28,358,000. Also, common shares purchased during the first six months of $6,002,000 represented an increase of $3,914,000 over last year. As a result of these two factors, our financing activities actually used $3,973,000 this year, $30,742,000 more than the $26,769,000 provided in 1999.

     At July 1, 2000, our primary source of liquidity consisted of $462,000 in cash and cash equivalents; short-term lines of credit and amounts available to be borrowed from banks via notes payable totaling $4,600,000 of which $300,000 was drawn and $700,000 was considered drawn to cover outstanding letters of credit; and the revolving credit agreement and temporary line of credit totaling $105,000,000, of which $69,900,00 was drawn and $11,300,000 was considered drawn to cover outstanding letters of credit. At July 1, 2000 our credit facilities totaled $110,000,000. We believe our available credit will exceed credit requirements, and that our liquidity is adequate.

     Revenues of $155,461,000 for the first six months of 2000 increased $4,443,000 or 2.9% compared to the same period in 1999. Our revenues for the second quarter of $88,070,000 increased $5,318,000 or 6.4%. Our Residential and Commercial services revenues increased 11.7% and 10.1% in the quarter and year to date respectively. These improvements are a continued reflection of generally good economic conditions, focused sales efforts, and revenues gained from small, selective acquisitions consummated over the last several years. The increased revenues we realized in Residential and Commercial services were partially offset by reductions of 1.3% and 4.9% in Utility services revenues in the quarter and year to date respectively. These reductions were primarily due to the decline in productivity and pricing issues we mentioned earlier in our discussion.

     Operating costs increased in both dollars and as a percentage of revenues for the quarter and year to date. In the quarter they totaled $58,696,000, an increase of $4,906,000 or 1.7% as a percentage of revenues. For the first six months they totaled $110,679,000, an increase of $6,332,000 or 2.1%. These higher costs are attributable to the factors cited earlier in our discussion, primarily higher relative labor costs associated with productivity declines, higher start up costs on utility contracts, higher repair costs, and increased fuel costs.

     Our selling expense in the quarter of $13,166,000 was only $29,000 higher than last year, and as a percentage of revenues it declined 1.0% to 14.9%. In the first six months these costs totaled $23,761,000, $763,000 more than in 1999, but only .1% higher as a percentage of revenues. The year to date increase is attributable to higher field management wages and branch office expenses, primarily in Residential and Commercial services.

     Our general and administrative costs in the quarter of $6,069,000 increased $946,000 or .7% as a percentage of revenues. For the first six months they totaled $12,341,000, an increase of $2,454,000 or 1.4% as a percentage of revenues. The increases are primarily due to a higher level of professional and temporary services now being expensed related to our new enterprise-wide information system; in 1999 professional services costs associated with implementation of the system had been capitalized. To a lesser extent, the increase in general and administrative costs is due to a somewhat higher level of salaries generally. We anticipate a reduction of professional services over the balance of 2000.

     Depreciation and amortization of $5,385,000 in the quarter increased $306,000 but remained even at 6.1% as a percentage of revenues. For the first six months, these costs totaled $10,375,000, an increase of $447,000 or only .1% as a percentage of revenues.

     Interest expense totaled $2,594,000 for the first six months, an increase of $776,000 or .4% as a percentage of revenues when compared to 1999. The increase is attributable primarily to our higher level of borrowings and to higher interest rates in the current year. Our interest expense in the quarter of $1,613,000 increased $590,000 or .6% as a percentage of revenues. While also due to higher borrowing levels and generally higher interest rates, the quarterly increase is also attributable to higher LIBOR spreads associated with our new credit agreement.

   We experienced a decline in other income of $595,000 to $365,000 for the first six months of 2000 when compared to last year. This is mainly due to a gain we realized in the second quarter of 1999 on the sale of our Troy, Michigan facility.

     Our loss before income tax credits in the first six months totaled $3,924,000 and represented 2.5% of revenues. Effective income tax rates of 39.6% and 40.6% were used to compute income tax benefits and income taxes in 2000 and 1999, respectively.

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.

August 15, 2000