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SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended June 1, 2003

Commission File Number 1-10226

THE ROWE COMPANIES

(Exact name of registrant as specified in its charter)

Registrant’s telephone number, including area code: 703-847-8670

N/A

Former name, former address and former fiscal year, if changed since last report.

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  YES  x  No  ¨

Indicate by check mark whether the registrant is an accelerated filed (as defined in Rule 12b-2 of the Exchange Act)  YES  ¨  No  x

Indicate the number of shares outstanding of each of the issuer’s classes of common stock as of the close of the period covered by this report.

THE ROWE COMPANIES

INDEX

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PART 1—FINANCIAL INFORMATION

THE ROWE COMPANIES AND WHOLLY-OWNED SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

See notes to consolidated financial statements

3

THE ROWE COMPANIES AND WHOLLY-OWNED SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE THREE AND SIX MONTHS ENDED JUNE 1, 2003 AND JUNE 2, 2002

(Unaudited)

See notes to consolidated financial statements

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THE ROWE COMPANIES AND WHOLLY-OWNED SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE SIX MONTHS

ENDED JUNE 1, 2003 AND JUNE 2, 2002

UNAUDITED

See notes to consolidated financial statements

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THE ROWE COMPANIES AND WHOLLY-OWNED SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE SIX MONTHS

ENDED JUNE 1, 2003 AND JUNE 2, 2002

UNAUDITED

Reconciliation of Net Earnings (Loss) to Net Cash

Provided By Operating Activities:

See notes to consolidated financial statements

6

THE ROWE COMPANIES AND WHOLLY-OWNED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

UNAUDITED

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THE ROWE COMPANIES AND WHOLLY-OWNED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

UNAUDITED

The estimates of lease termination costs are based in part on third-party advice regarding the time required to sub-lease such space as well as the rate per square foot at which such space may be subleased. Actual time to sublease and the rate per square foot of any subleases may differ from such estimates. As conditions warrant, the Company will make appropriate adjustments to these estimates. The following table outlines the components of the restructuring and related charges recorded as of December 1, 2002, including non-cash components of the charges and the balance of the reserve account at June 1, 2003:

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THE ROWE COMPANIES AND WHOLLY-OWNED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

UNAUDITED

Utilizing proceeds from the sale of Mitchell Gold (see Note 12), in addition to cash from operations, significant reductions in the Company’s outstanding debt occurred during the six months ended June 1, 2003. The industrial revenue bond, which financed the construction of Mitchell Gold’s manufacturing facility, was assumed by the purchaser. All debt that pre-dated the Company’s restructuring of its debt in May 2002 has been repaid, except for the capital lease obligation. The Company is soliciting proposals for refinancing the capital lease obligation, or extending the capital lease obligation, which is due in full in December 2003.

In addition to reducing the outstanding balances of long-term debt, certain changes in the interest rates charged on the Company’s debt have also been achieved. The capitalized lease obligation bears interest at prime plus 1%, reduced post-Mitchell Gold from a blended rate of prime plus 2% and prime plus 3%, for a current rate of 5.75%.

The revolving bank loan and term loan bear interest at 30 day LIBOR plus a spread of 2.75% and 3%, respectively, currently 4.05% and 4.30%, respectively. The Company has the option to use 30, 60, or 90 day LIBOR as the base rate for the term and revolving loans. Should the revolving loan increase after locking in a base rate, interest on the increased principal is based on prime plus 1%.

The term loan requires quarterly principal payments of $250,000, and both the term and revolving loans expire in May 2007.

The mortgage loans bear interest at 7.75%, and require monthly principal payments based on a 25-year amortization period, with a balloon maturity in May 2012.

The Company is negotiating with its lenders for new covenants for its outstanding debt, in response to changes in the Company’s financial position due to the sale of Mitchell Gold.

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THE ROWE COMPANIES AND WHOLLY-OWNED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

UNAUDITED

As of June 1, 2003 and June 2, 2002, there were 1,956,027 and 1,908,833 outstanding options, respectively, whose exercise price was equal to or greater than the average market price of the company’s common stock for the three and six months ended June 1, 2003 and June 2, 2002, respectively. These options are excluded from the computation of the effect of dilutive stock options shown in the table above.

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THE ROWE COMPANIES AND WHOLLY-OWNED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

UNAUDITED

Effective April 2, 2003, the Company sold its Mitchell Gold manufacturing subsidiary, which had been included as a component of its manufacturing segment (see Note 12). All previously reported amounts have been restated to reflect Mitchell Gold’s operating results as a component of discontinued operations. For the 2002 table shown above, the following amounts relating to Mitchell Gold have been excluded: net shipments of $28,609,000; pre-tax earnings of $1,969,000; and total assets of $32,424,000.

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THE ROWE COMPANIES AND WHOLLY-OWNED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

UNAUDITED

12

THE ROWE COMPANIES AND WHOLLY-OWNED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

UNAUDITED

Proceeds from the sale, net of liabilities assumed, were approximately $39.6 million and are subject to adjustments for certain working capital items as of the closing date. The sale resulted in a gain, after taxes, of $462,000. The Company utilized the net proceeds to reduce outstanding debt by approximately $22.1 million, to pay expenses of the sale of approximately $4 million, and to pay the obligation under the long-term earn-out provisions of the original purchase agreement for Mitchell Gold.

Included in earnings from discontinued operations in the Company’s consolidated statement of operations for the three and six months ended June 1, 2003, were the following amounts associated with Mitchell Gold:

The change in goodwill from December 1, 2002, to June 1, 2003 is due to the sale of Mitchell Gold.

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THE ROWE COMPANIES AND WHOLLY-OWNED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

UNAUDITED

Management has determined that there has been no impairment of the goodwill recorded in its financial statements. Goodwill is included in the total assets of the wholesale segment in its segment reporting

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THE ROWE COMPANIES AND WHOLLY-OWNED SUBSIDIARIES

MANAGEMENT’S DISCUSSION AND ANALYSIS

OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

UNAUDITED

Results of Operations:

Six Months Ended June 1, 2003 Compared to Six Months Ended June 2, 2002

Net shipments during the first six months of 2003 decreased by $1,549,000, or 1.2%, to $131,778,000 from $133,327,000 in 2002. The decrease in shipments resulted from decreased wholesale shipments, due to industry wide soft demand. Note that all amounts have been restated to reflect the results of operations at Mitchell Gold, sold during the second quarter of 2003, in discontinued operations for all periods presented.

For the wholesale segment, net shipments decreased $4.4 million, or 5.0%, to $83.6 million from $88.0 million. The decrease resulted primarily from reduced shipments to existing customers, due to industry wide soft demand, offset in part by some new customers. Included in the wholesale segment numbers above were shipments to the retail segment of $9.8 million in 2003, an increase of $1.2 million over the first six months of 2002.

In the retail segment, net shipments increased 7.5%, to $58.0 million from $53.9 million. Most product categories showed gains compared to last year. Retail operations benefited from management initiatives to improve promotional efficiency and selling effectiveness, and to strengthen performance of certain previously underperforming merchandise categories.

Gross profit during the first six months of 2003 decreased by $1,226,000, or 2.6%, to $46,306,000 from $47,532,000 in 2002. Gross margin, or gross profit as a percent of net shipments, decreased to 35.1% from 35.7% in 2002 due to lower manufacturing volume impacting fixed overhead absorption; higher transportation fuel costs early in the year; and markdowns taken to clear out certain slow moving inventory at Storehouse.

For the first six months of 2003, wholesale segment gross profit decreased $2.2 million, or 10.5%, from $20.6 million to $18.4 million. Gross margin decreased from 23.2% in 2002 to 22.0% in 2003. Lower volume unfavorably impacted fixed overhead absorption, which combined with higher fuel costs early in the year, accounted for the change in gross profit and margin. In the retail segment, gross profit for the first six months increased by 3.5%, or $0.9 million. Retail gross profit grew at a lesser rate than retail segment shipments due to markdowns taken to clear slow moving and excess product, resulting in a gross margin decrease from 49.8% to 47.9%.

Selling and administrative expenses during the first six months of 2003 decreased by $634,000, or 1.3%, to $46,954,000 from $47,588,000 in 2002. Approximately $328,000 of the decrease represents the cessation of goodwill amortization effective in fiscal year 2003 in accordance with new accounting regulations. Essentially all other categories of selling and administrative costs have declined in 2003 from 2002 levels, with the exception of warehouse costs in the retail segment. This area has been impacted unfavorably by the consolidation of two distribution center locations into one operation as part of the retail consolidation undertaken in 2002. Overall, manufacturing segment selling and administrative expenses declined by $1.1 million, to approximately $12.2 million in 2003 from $13.3 million in 2002. Retail segment costs, including retail restructuring and related charges, have decreased by $1.2 million to $31.6 million in 2003 from $32.8 million in 2002. Retail restructuring and related charges totaled $2.3 million in 2002, and $125,000 in 2003.

Operating losses were $(773,000) for the first six months of 2003 compared to $(2,145,000) in the prior year, primarily as a result of retail restructuring charges in 2002 of $2.3 million offset by lower net shipments due to

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THE ROWE COMPANIES AND WHOLLY-OWNED SUBSIDIARIES

MANAGEMENT’S DISCUSSION AND ANALYSIS

OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

UNAUDITED

soft industry wide retail conditions and inclement winter weather, higher levels of clearance sales at lower margins, and costs to integrate and resolve problems at one retail distribution center.

Net interest expense increased from $1,413,000 in 2002 to $2,372,000 in 2003, primarily as a result of reclassifying payments on the Elliston facility lease from rent to interest expense, and amortization of deferred loan costs in 2003 as a result of the debt restructuring completed in May 2002.

Other income decreased $204,000 during the first six months of 2003, from $1,010,000 to $806,000.

Loss from continuing operations before taxes during the first six months of 2003 improved by $209,000 to $(2,339,000) from $(2,548,000) in 2002, reflecting lower sales, lower retail margins due to increased clearance sale activity, and higher interest costs, offset in part by lower goodwill amortization expense and the retail restructuring charges recorded in 2002.

The effective tax rate changed between 2002 and 2003 due primarily to the impact of non-deductible expense items, particularly goodwill amortization in 2002, on the calculation of tax expense.

Three Months Ended June 1, 2003 Compared to Three Months Ended June 2, 2002

Net shipments during the second quarter of 2003 increased by $477,000, or 0.7%, to $68,059,000 from $67,582,000 in 2002. The increase in shipments resulted from increased retail shipments, particularly due to increases in upholstery and bedroom furniture sales.

For the wholesale segment, net shipments decreased $3.9 million, or 8.4%, to $42.1 million from $46.0 million. The decrease resulted primarily from reduced shipments to existing customers, due to industry wide soft demand, offset in part by some new customers. Included in the wholesale segment numbers above were shipments to the retail segment of $4.6 million in 2003, an increase of $0.2 million over second quarter of 2002. In the retail segment, net shipments increased $4.0 million, or 15.1%, to $30.5 million from $26.5 million. Strong upholstery and bedroom furniture sales accounted for the retail sales increase.

Gross profit during the second quarter of 2003 decreased by $331,000, or 1.4%, to $23,963,000 from $24,294,000 in 2002. Gross margin decreased to 35.2% from 35.9% in 2002 due to lower manufacturing volume impacting fixed overhead absorption; higher fuel costs; and markdowns taken to clear out slow moving inventory at Storehouse.

For the second quarter of 2003, wholesale segment gross profit decreased $1.9 million, or 17.5%, from $11.0 million to $9.1 million. Gross margin decreased from 23.9% in 2002 to 21.5% in 2003. Lower volume unfavorably impacted fixed overhead absorption, which combined with higher fuel costs accounted for the decline in gross profit and gross margin. In the retail segment, gross profit increased by 11.7%, or $1.5 million. This is attributable to higher sales, partially offset by markdowns taken to clear slow moving and excess product, resulting in a gross margin decrease from 49.9% to 48.4%.

Selling and administrative expenses during the second quarter of 2003 decreased by $347,000, or 1.4%, to $24,270,000 from $24,617,000 in 2002. Approximately $164,000 of the decrease represents the cessation of goodwill amortization effective in fiscal year 2003 in accordance with new accounting regulations. Essentially all other categories of selling and administrative costs have declined in 2003 from 2002 levels, with the excep-

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THE ROWE COMPANIES AND WHOLLY-OWNED SUBSIDIARIES

MANAGEMENT’S DISCUSSION AND ANALYSIS

OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

UNAUDITED

tion of warehouse costs in the retail segment. This area has been impacted unfavorably by the consolidation of two distribution center locations into one as part of the retail consolidation undertaken in 2002. Overall, manufacturing segment selling and administrative expenses declined by $0.4 million, to approximately $6.5 million in 2003 from $6.9 million in 2002. Retail segment costs have increased by $0.2 million to $16.0 million in 2003 from $15.8 million in 2002.

Operating losses were ($432,000) for the second quarter of 2003 compared to ($2,412,000) in the prior year. Retail restructuring charges in 2002 account for the bulk of the improvement.

Net interest expense increased from $633,000 in 2002 to $1,036,000 in 2003, primarily as a result of reclassifying payments on the Elliston facility lease from rent to interest expense, and amortization of deferred loan costs in 2003 as a result of the debt restructuring completed in May 2002. Lower balances as a result of paying down outstanding debt with the proceeds of the Mitchell Gold sale partially offset these other factors.

Other income decreased $117,000 during the second quarter of 2003, from $528,000 to $411,000.

Loss from continuing operations before taxes during the second quarter of 2003 improved by $1,460,000 to $(1,057,000) from $(2,517,000) in 2002, primarily reflecting the retail restructuring charges in 2002.

The effective tax rate changed between 2002 and 2003 due primarily to the impact of non-deductible expense items, particularly goodwill amortization in 2002, on the calculation of tax expense.

Critical Accounting Policies:

The Company’s consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America. Certain estimates and assumptions have been made that affect the amounts and disclosures reported in the consolidated financial statements and the related accompanying notes. Actual results could differ from these estimates and assumptions. Management uses its best judgment in valuing these estimates and may solicit external advice. Estimates are based on current facts and circumstances, prior experience and other assumptions believed to be reasonable. Critical accounting policies that may affect the consolidated financial statements include self-insurance, long-lived asset valuations and impairments and inventory reserves.

Self-Insurance Reserves

The Company is self-insured for substantial portions of its health care and workers compensation insurance programs. Reserves are established for such costs based on, among other factors, reported claims to date, prior history, and actuarial projections of claims incurred but not reported and future medical cost increases likely to affect the total cost to settle claims. If actual results in any of these areas change from prior periods, adjustments to recorded reserves may be required.

Long-lived Asset Valuations and Impairments

The Company monitors the economic health of its facilities and operations and makes determinations, using cash flow analyses, of the fair value of its assets, both tangible and intangible. When cash flow analysis indicates that the fair value of an asset is less than its book value, and such shortfall is not believed to be

17

THE ROWE COMPANIES AND WHOLLY-OWNED SUBSIDIARIES

MANAGEMENT’S DISCUSSION AND ANALYSIS

OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

UNAUDITED

temporary in nature, then an adjustment to reduce the asset to its fair value is made. As conditions change, additional adjustments of fair value may be required.

Inventory Reserves

The Company maintains its inventories at the lower of cost or market value. Cost is determined on a last-in, first-out (LIFO) basis for inventory held at retail facilities, and on a first-in, first-out (FIFO) basis for inventory held at its manufacturing facilities. When conditions warrant (usually highlighted by slow-moving product, declining vendor prices on incoming product or a change in merchandising), reserves are established to reduce the value of inventory to net realizable values. As conditions warrant, additional adjustments may be required.

Liquidity and Source of Capital:

Cash from Operations

Net cash provided by operating activities was $5,453,000 during the first six months of 2003 versus $9,593,000 in 2002. Fluctuations in net cash used in operating activities are primarily the result of changes in operating income and changes in working capital accounts. Substantial changes from 2002 to 2003 included the decrease in inventory, particularly leather, during the early part of 2002; a reduction in receivables due to lower wholesale segment sales; the payout of the deferred compensation plan during 2002; and the collection of the 2001 tax refund in early 2002.

Cash from Investing Activities

Net cash provided by (used in) investing activities was $23,228,000 in 2003 and $(907,000) in 2002, primarily reflecting cash receipts and payments related to Mitchell Gold. Capital expenditures in both periods were generally routine information systems maintenance and upgrade projects.

Cash from Financing Activities

Net cash used in financing activities during the first six months of 2003 was $25,592,000 versus $14,136,000 during 2002. In 2002, the Company refinanced significant portions of its outstanding debt, including paying down approximately $14.1 million. During 2003, proceeds from the sale of Mitchell Gold were used to reduce outstanding debt by approximately $22 million. Proceeds from issuance of debt in 2003 reflect draws on the Company’s revolving working capital line, while reductions in the working capital line and other required debt service payments account for the remainder of the payments to reduce long-term debt. Cash deposited under letters of credit reflects money set aside to cover contingencies associated with the Mitchell Gold sale. The Company did not pay cash dividends on its common stock during any period covered by this report.

Contractual Obligations

The following summarizes our significant contractual obligations as of June 1, 2003:

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THE ROWE COMPANIES AND WHOLLY-OWNED SUBSIDIARIES

MANAGEMENT’S DISCUSSION AND ANALYSIS

OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

UNAUDITED

Management is in discussion with its lenders to modify the terms of the existing term and revolving credit facilities to reflect (a) reduced collateral for asset based loans from the sale of Mitchell Gold; (b) elimination of earnings and cash flow from operations due to the sale of Mitchell Gold and (c) lower outstanding debt as a result of using net proceeds from the sale of Mitchell Gold to reduce existing loan balances. Weakening of, or other adverse developments concerning operating performance, could limit the availability of funds to us, or adversely affect the price at which such funds may be available.

New Accounting Standards

In August 2001, the FASB issued SFAS No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets.” SFAS 144 is effective for fiscal years beginning after December 15, 2001, and interim periods within those fiscal years. This statement addresses financial accounting and reporting for the impairment or disposal

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THE ROWE COMPANIES AND WHOLLY-OWNED SUBSIDIARIES

MANAGEMENT’S DISCUSSION AND ANALYSIS

OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

UNAUDITED

of long-lived assets. It supersedes SFAS No. 121, “Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of.”

In June 2002, the FASB issued SFAS No. 146, “Accounting for Costs Associated With Exit and Disposal Activities.” SFAS 146 is effective for activities occurring after December 31, 2002. The standard requires companies to recognize costs associated with exit or disposal activities when they are incurred rather than at the date of a commitment to an exit or disposal plan. Examples of costs covered by the standard include lease termination costs and certain employee severance costs that are associated with a restructuring, discontinued operation, plant closing or other exit or disposal activity.

SFAS 144 and 146 will be applied to transactions as they occur.

In December 2002, the FASB issued Statement No. 148, “Accounting for Stock-Based Compensation—Transition and Disclosure, an amendment of FASB Statement No. 123.” In November 2002, the FASB issued FASB Interpretation No. (FIN) 45, “Guarantor’s Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others.” In January 2003, the FASB issued FIN 46, “Consolidation of Variable Interest Entities.” The Company’s adoption of these statements did not have a material effect on its results of operations or financial position.

In June 2003, the Financial Accounting Standard Board (FASB) issued Statement No. 149, “Amendments of Statement 133 on Derivative Instruments and Hedging Activities.” The statement is effective for contracts entered into or modified after June 30, 2003. The Company does not believe the adoption of this statement will have a material effect on the results of operations or financial position of the Company.

In June 2003, the Financial Accounting Standard Board (FASB) issued Statement No. 150, “Accounting for Certain Financial Instruments with Characteristics of Both Liabilities and Equity.” The statement is effective for financial instruments entered into or modified after May 31, 2003, and otherwise is effective at the beginning of the first interim period beginning after June 15, 2003. The Company does not believe the adoption of this statement will have a material effect on the results of operations or financial position of the Company.

Forward Looking Statements:

When used in this Quarterly Report on Form 10-Q and in other filings with the Securities and Exchange Commission, in press releases or other public shareholder communications, or in oral statements made with the approval of an authorized executive officer, the words or phrases “believe,” “will likely result,” “are expected to,” “will continue,” “is anticipated,” “estimate,” “project,” “plans,” or similar expressions, as well the use of future dates, are intended to identify “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. You are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date made. These statements may relate to our future financial performance, strategic plans or objectives, revenues or earnings projections, or other financial items. By their nature, these statements are subject to numerous uncertainties that could cause actual results to differ materially from those anticipated in the statements. Important factors that could cause actual results to differ materially from the results anticipated or projected include, but are not limited to, the following: changes from anticipated levels of sales, whether due to future national or regional economic and competitive conditions, customer acceptance of existing and new products, or otherwise; pending or future litigation; pricing pressures due to excess capacity; raw material cost increases; transportation cost increases; the inability of a major customer to meet its obligations; loss of significant customers in connection with a merger, acquisition, redispo-

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THE ROWE COMPANIES AND WHOLLY-OWNED SUBSIDIARIES

MANAGEMENT’S DISCUSSION AND ANALYSIS

OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

UNAUDITED

sition, bankruptcy or otherwise; actions of current or new competitors; increased advertising costs associated with promotional efforts; change of tax rates; change of interest rates; future business decisions and other uncertainties, all of which are difficult to predict and many of which are beyond the control of the Company.

Additional risks include:

Our manufacturing and our retailing subsidiaries face significant competition from numerous competitors, many of which are larger and better capitalized. Our subsidiaries may be at a competitive disadvantage as a result. If our subsidiaries lose market share to competitors, our financial performance could be adversely affected.

Our retail operations are currently unprofitable, and there can be no assurance that profitability will be achieved.

As a result of the sale of Mitchell Gold, revisions to our debt covenants must be agreed upon with our lenders. The Company is negotiating with its lenders as to what appropriate covenants should be. While the Company anticipates reaching such agreements, continued softness in the home furnishings marketplace could cause reluctance on the part of lenders to continue to extend credit to the Company under terms the Company considers acceptable, requiring the Company to obtain financing from other lenders. There can be no assurance that such other financing would be available.

The Company is currently soliciting proposals to refinance a capital lease obligation, which matures in December 2003. The capital lease is secured by certain manufacturing facilities. There can be no assurance that the Company will be successful in obtaining this financing, or that, if obtained, the financing will be on favorable terms and conditions.

We do not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date on which the forward-looking statement is made.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Interest Risk Disclosures:

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THE ROWE COMPANIES AND WHOLLY-OWNED SUBSIDIARIES

MANAGEMENT’S DISCUSSION AND ANALYSIS

OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

UNAUDITED

Because the Company’s obligations under its term loans, revolving loans and lines of credit bear interest at variable rates, the Company is sensitive to changes in interest rates. A 10% fluctuation in market interest rates would not have a material impact on earnings during the 2003 fiscal year.

Item 4. Controls and Procedures.

An evaluation of our disclosure controls and procedures (as defined in Rule 13a-14(c) under the Securities Exchange Act of 1934 (the “Act”)) was carried out under the supervision and with the participation of our Chief Executive Officer, Chief Financial Officer and several other members of our senior management within the 90-day period preceding the filing date of this quarterly report. Our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures as currently in effect are effective in ensuring that the information we are required to disclose in the reports we file or submit under the Act is (i) accumulated and communicated to our management (including the Chief Executive Officer and Chief Financial Officer) in a timely manner, and (ii) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.

We review our internal controls for effectiveness on an ongoing basis. There were no significant changes in our internal controls or in other factors that could significantly affect these controls subsequent to the date of their most recent evaluation.

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PART II—OTHER INFORMATION

Item 1. Legal Proceedings.

None

Item 2. Changes in Securities and Used Proceeds.

None

Item 3. Defaults Upon Senior Securities.

None

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

The annual meeting of shareholders for The Rowe Companies was held on April 15, 2003, in McLean, Virginia. The shareholders approved the re-election of three individuals to the Board of Directors; Woodlief, Ptashek and Tofias. The shareholders also approved The 2003 Stock Option and Incentive Plan. Voting results are shown below:

Item 5. Other Information.

None

Item 6. Exhibits and Reports on Form 8-K.

a. Exhibits:

99.A—Certifications

b. Reports on Form 8-K:

On April 10, 2003, a Form 8K was filed announcing the sale of The Mitchell Gold Co. with the applicable press release. On April 17, 2003, a Form 8K was filed announcing the disposition of its subsidiary, The Mitchell Gold Co., with applicable pro forma financial information.

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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 hereunto duly authorized.

24

CERTIFICATIONS

I, Gerald M. Birnbach, certify that: