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                                                                                                                                                                                                                                                                                                                                               &nb sp;                                                                                                                                                                                          SECURITIES AND EXCHANGE COMMISSION

Washington, D.C., 20549

FORM 10-Q

QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarter Ended May 31, 2002 Commission File Number:1-9852

CHASE CORPORATION

(Exact name of registrant as specified in its charter)

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 90 days.

Part 1:  FINANCIAL INFORMATION

CHASE CORPORATION

CONSOLIDATED BALANCE SHEET

LIABILITIES AND STOCKHOLDERS' EQUITY   

See accompanying notes to the consolidated financial statements and accountants' review report.

CHASE CORPORATION

STATEMENT OF CONSOLIDATED OPERATIONS

(UNAUDITATED)

See accompanying notes to the consolidated financial statements and accountants' review report.

CHASE CORPORATION

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(UNAUDITED)

9 MONTH ENDED May 31, 2002 AND May 31, 2001

See accompanying notes to the consolidated financial statements and accountants' review report.

CHASE CORPORATION

CONSOLIDATED STATEMENT OF CASH FLOWS

(UNAUDITED)

See accompanying notes to the consolidated financial statements and accountants' review report.

NOTES TO CONSOLIDATED FINANCIAL STATEMENT

July 08, 2002

Note A - Basis of Presentation

The accompanying unaudited Consolidated Financial Statements have been prepared in accordance with the instructions to Form 10-Q and all adjustments (consisting of nonrecurring accruals) have been made which are, in the opinion of Management, necessary to a fair statement of the results for the interim periods reported. The financial statements of Chase Corporation include the activities of its divisions and its foreign sales subsidiary.

Note B - Inventories

Certain divisions used estimated gross profit rates to determine the cost of goods sold.  No significant adjustments have resulted from reconciling with the interim physical inventories as a result of using this method.

Note C - Income per Share of Common Stock

Income per share is based on the average number of shares and share equivalents outstanding during the period.  The average number of shares outstanding used in determining basic per share results was 4,037,814 and 4,047,317 for the period of nine months and three months ended May 31, 2002.  Earnings per share on a fully diluted basis were calculated on 4,135,651 and 4,143,471 common shares and share equivalents. Common share equivalents arise from the issuance of certain stock options.

Note D - Acquisition of Assets

Chase Corporation (the "Company") has purchased certain operating assets of the Tapecoat Division of TC Manufacturing, Inc. from TC Manufacturing, Inc. for cash and liabilities of eight million dollars ($8,000,000) (subject to certain adjustments) and 40,000 shares of Chase Corporation common stock.  Additionally, the Company purchased buildings and land for one million seven hundred thousand dollars ($1,700,000). 

Note E - Review of Goodwill

In accordance with statement of financial accounting standards number 142, which the Company adopted September 1, 2001, an interum evaluation of goodwill has been conducted.   Based on the evaluation of estimated future cash flows no adjustment to goodwill has been made at this time.

Note F - Earnings Per Share

Note G - Review by Independent Public Accountant

The financial information included in this form has been reviewed by an independent public accountant in accordance with established professional standards and procedures.  Based upon such review, no adjustments or additional disclosure were recommended.

Letter from the independent public accountant is included as a part of this report.

INDEPENDENT ACCOUNTANTS' REVIEW REPORT

To the Board of Directors

Chase Corporation

Bridgewater, Massachusetts

We have reviewed the consolidated balance sheet of Chase Corporation and  Subsidiaries as of May 31, 2002  and  the related consolidated statements of operations, stockholders equity, and cash flows for the periods of three and nine months ended May 31, 2002 and May 31, 2001;  in accordance with Statements on Standards for  Accounting and Review Services issued by the American Institute of Certified Public Accountants.  All information included in these financial statements is the representation of the management of Chase Corporation.

A review of interim financial information consists principally of obtaining an understanding of the system for the preparation of interim financial information, applying analytical procedures  to financial data, and making inquiries of persons responsible for financial and accounting matters.  It is substantially less in scope than an audit conducted in accordance with U.S. generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole.  Accordingly, we do not express such an opinion.  

Based on our review, we are not aware of any  material modifications that should be made to the accompanying consolidated financial statements referred to above for them to be in conformity with accounting principles generally accepted in the United States of America.

We have previously audited, in accordance with U. S. generally accepted auditing standards, the consolidated balance sheet of Chase Corporation and Subsidiaries as of August 31, 2001, and the related statements of operations, stockholders' equity, and cash flows for the year then ended (not presented herein); and in our report dated  November 7, 2001, we expressed an unqualified opinion on those financial statements.  In our opinion, the information set forth in the accompanying consolidated balance sheet as of August 31, 2001, is fairly stated in all material respects in relation to the consolidated balance sheet from which it has been derived.

/S/ LIVINGSTON & HAYNES, P.C.

Wellesley, Massachusetts

July 12, 2002

Results of Operations

     Net revenues decreased 2% for the first nine months of fiscal 2002 versus the same period last year while third quarter revenue increased 8% when compared to the same period in fiscal 2001.  The Company's performance continued to be impacted by the recession, which was somewhat offset from the benefits of our asset acquisition of the Tapecoat Division of TC Manufacturing, Inc. concluded  November 1, 2001.  The revenue generated by Tapecoat through May 31, 2002 amounted to $4,413,000.  During the third quarter, the Company also had some improvement in certain key product areas that last year were negatively effected by the slowing economy.  This is also evidenced by the slight improvement in our operating profit as a percent of sales when comparing our last quarter (11.2%) report to this quarter (11.9%).   However, the Company's Electronic Manufacturing Services (EMS) segment continues to be more adversely affected by the economic downturn.  Overall, our diversification has enabled us to take advantage of certain construction and manufacturing markets enabling us to continue to operate on a positive basis.

     When comparing the nine months fiscal 2001 revenue to that of the prior year, the majority of the 7% increase related to the investments and acquisitions within the EMS segment that were concluded during fiscal 1999.  The third quarter of fiscal 2001 was the period that the slowing economy had its first material impact on Chase Corporation.

Sales and Operating Profit by Segment
     ($-000)

     The cost of products sold increased $1,250,000 during the current quarter when comparing it to the same quarter last year.  When comparing the like period for the first nine months of fiscal 2002 to that of the previous year, the increase was $800,000.  To a large extent, these increases are volume related although for the first nine months as a percent of sales, cost of products increased by 4% to 74%.  The percent of increase is associated with selling price erosion created by competitive pressure, a product mix change and lower volume during the nine month period, thereby decreasing efficiencies previously achieved through economics of scale.

    When comparing the like periods of 2001 and 2000, the cost of product variance was not material.  Raw material price increases were offset by the benefits of product mix and a stabilized manufacturing and productivity environment.  

     Selling and administration expenses increased $450,000 during the current year, and as a percent of sales have increased by 1.4%.   The additional costs are primarily associated with the Tapecoat acquisition.   When comparing fiscal 2001 to 2000 the increase of $634,000 was predominantly volume related.  The Company has also invested in personnel required to support future growth while continuing to be focused on cost containment.

     Interest expense decreased to $406,000 for the first nine months of this year as compared to $650,000 and $659,000 for the periods of 2001 and 2000.   The decrease relates to the repayment of debt incurred for acquisitions and also the reductions to interest rates.  The prior period interest expense increase was primarily associated with the debt incurred to complete acquisitions.  The Company continues to benefit from the low borrowing rates from its financial institutions.

     A majority of the earnings decline during the nine months ended May 31 are the result of lower sales of products and services and the associated profitability provided by our Electronic Manufacturing Services (EMS) segment.  Of the pre tax earnings decline of $1.3 million, about $1.15 million relates to the reduced operating profit of the Company's EMS segment.  Our more traditional markets continue to perform reasonably well in spite of the recession.  The Company has also received the benefit of some profitability by the Tapecoat acquisition.  As expected, the Company's performance improved during the third quarter.  The Company anticipates continued improvement during our fourth quarter and solid improvement during fiscal 2003.   It still remains difficult to predict a full recovery of the economy although we appear to be more positive than negative as we look into our next fiscal year.

    When comparing 2001 to 2000 a majority of the earnings improvements were from the benefits received from the Company's investments in the EMS segment, which were primarily concluded during the second half of fiscal 1999.

    Management will continue to maximize our diversity as we move through this period of economic difficulty.  We continue to seek to maximize and expand our current business, while at the same time identifying future opportunities through selective acquisitions.

    The effective tax rate over the past few years are lower than the applicable rates.  The Company continues to receive the tax benefit of solid export sales through its Chase Export Corporation subsidiary.  Also, effective January 1999, the Company acquired 100% ownership of Sunburst EMS which has provided the benefit of consolidating historical losses for income tax purposes.

     The increase from minority interest is associated with our 42% equity position in the Stewart Group, Inc., Toronto, Canada. 

Liquidity and Sources of Capital

    The ratio of current assets to current liabilities was 1.9 at the end of the third quarter of fiscal 2002 as compared to 1.7 at the prior year-end.

    Long-term debt increased by $5,630,000 when compared to the end of fiscal 2001.  The majority of the increase is relates to the debt incurred to purchase the assets of Tapecoat and the funds required to purchase the building in West Bridgewater, MA, which is the facility that is occupied by Sunburst EMS.

    The Company had $1,615,000 in available credit at May 31, 2002 under its credit arrangements with its primary bank and plans to utilize this means to help finance its interim needs during the year.  Current financial resources and anticipated funds from operations are expected to be adequate to meet requirements for funds in the year ahead.

Recent Accounting Pronouncements

     In July 2001, the Financial Accounting Standards Board (FASB) issued FASB Statements Nos.141 and 142 (FAS 141 and FAS 142), Business Combinations and Goodwill and Other Intangible Assets.  FAS 141 replaces APB 16 and eliminates pooling-of-interests accounting prospectively.  It also provides guidance on purchase accounting related to the recognition of intangible assets and accounting for negative goodwill.  FAS 142 changes the accounting for goodwill from an amortization method to an impairment-only approach.  Under FAS 142, goodwill will be tested annually and whenever events or circumstances occur indicating that goodwill might be impaired.

     FAS 141 and FAS 142 are effective for all business combinations completed after June 30, 2001.  Upon adoption of FAS 142, amortization of goodwill recorded for business combinations consummated prior to July 1, 2001 will cease, and intangible assets acquired prior to July 1, 2001 that do not meet the criteria for recognition under FAS 141 will be reclassified to goodwill.  Companies are required to adopt FAS 142 for fiscal years beginning after December 15, 2001, but early adoption is permitted.  The Company adopted FAS 142 on September 1, 2001, the beginning of fiscal 2002.  In connection with the adoption of FAS 142, the Company was required to perform a transitional goodwill impairment assessment.  An interim evaluation of goodwill has been conducted based on the evaluation of estimated future cash flow and no adjustments to goodwill are required at this time.  Amortization of Goodwill was $666,745, $660,074 and $159,582 for the fiscal years 2001, 2000, and 1999 respectively.

Forward-Looking Information

    From time to time, the Company may publish, verbally or in written form, forward-looking statements relating to such matters as anticipated financial performance, business prospects, technological developments, new products, research and development activities and similar matters.  In fact, this Form 10-Q (or any other periodic reporting documents required by the 1934 Act) may contain forward-looking statements reflecting the current views of the Company concerning potential future events or developments.  The Private Securities Litigation Reform Act of 1995 (the "Act") provides a "safe harbor" for forward-looking statements.  In order to comply with the terms of the "safe harbor," the Company cautions investors that any forward-looking statements made by the Company are not guarantees of future performance and that a variety of factors could cause the Company’s actual results and experience to differ materially from the anticipated results or other expectations expressed in the Company’s forward-looking statements.  The risks and uncertainties which may affect the operations, performance, development and results of the Company’s business include, but are not limited to, the following: uncertainties relating to economic conditions; uncertainties relating to government and regulatory policies; uncertainties relating to customer plans and commitments; the pricing and availability of equipment, materials and inventories; technological developments; performance issues with key suppliers and subcontractors; worldwide political stability and economic growth; regulatory uncertainties; delays in testing of new products; rapid technology changes and the highly competitive environment in which the Company operates.  Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date the statement was made.

ITEM 6  EXHIBITS AND REPORTS ON FORM 8-K

(A)Exhibits

Reg.  S-K

Item 601

Pursuant to reg. S-K item 601
no exhibits are required.

    (b)Reports on Form 8-K

No 8-K reports were filed during the three months ended May 31, 2002.

          No financial statements were filed during the three months ended May 31, 2002.

Dated: July 12,  2002