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

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

FORM 10-Q
(MARK ONE)

<Table>

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD
ENDED SEPTEMBER 30, 2002, 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 NO. 0-3134

PARK-OHIO HOLDINGS CORP.
(Exact name of registrant as specified in its charter)

<Table>

OHIO 34-1867219
- ----------------------------------------- -----------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

23000 EUCLID AVENUE, CLEVELAND, OHIO 44117
- ----------------------------------------- -----------------------------------------
(Address of principal executive offices) (Zip Code)
</Table>

REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: 216/692-7200
PARK-OHIO HOLDINGS CORP. IS A SUCCESSOR ISSUER TO PARK-OHIO INDUSTRIES, INC.

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 twelve 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 [ ]

Number of shares outstanding of registrant's Common Stock, par value $1.00 per
share, as of October 31, 2002: 10,496,191.

The Exhibit Index is located on page 23.

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

PARK-OHIO HOLDINGS CORP. AND SUBSIDIARIES

INDEX

<Table>

PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)
Consolidated balance sheets -- September 30, 2002 and
December 31, 2001
Consolidated statements of operations -- Nine months and
three months ended September 30, 2002 and 2001
Consolidated statement of shareholders' equity -- Nine
months ended September 30, 2002
Consolidated statements of cash flows -- Nine months ended
September 30, 2002 and 2001
Notes to consolidated financial statements -- September 30,
2002
Independent accountants' review report
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders
Item 6. Exhibits and Reports on Form 8-K

SIGNATURE

EXHIBIT INDEX
</Table>

PART I

FINANCIAL INFORMATION

PARK-OHIO HOLDINGS CORP. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

<Table>
<Caption>
(UNAUDITED)
SEPTEMBER 30 DECEMBER 31
2002 2001
------------ -----------
(DOLLARS IN THOUSANDS)

ASSETS
Current Assets
Cash and cash equivalents................................. $ 6,965 $ 3,872
Accounts receivable, less allowances for doubtful accounts
of $2,808 at September 30, 2002 and $2,680 at December
31, 2001............................................... 123,590 99,241
Inventories............................................... 153,643 151,463
Other current assets...................................... 20,855 23,108
-------- --------
Total Current Assets.............................. 305,053 277,684
Property, Plant and Equipment............................... 233,231 214,480
Less accumulated depreciation............................. 116,589 105,155
-------- --------
116,642 109,325
Other Assets
Goodwill.................................................. 130,263 130,263
Net assets held for sale.................................. 21,637 22,733
Prepaid pension and other................................. 53,826 50,371
-------- --------
$627,421 $590,376
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Trade accounts payable.................................... $ 88,051 $ 65,131
Accrued expenses.......................................... 45,408 28,482
Current portion of long-term liabilities.................. 3,467 3,787
-------- --------
Total Current Liabilities......................... 136,926 97,400
Long-Term Liabilities, less current portion
Long-term debt............................................ 327,958 328,731
Other postretirement benefits............................. 23,219 24,001
Other..................................................... 13,732 15,277
-------- --------
364,909 368,009
Shareholders' Equity
Capital stock, par value $1 a share:
Serial Preferred Stock................................. -0- -0-
Common Stock........................................... 11,210 11,210
Additional paid-in capital................................ 56,135 56,135
Retained earnings......................................... 70,525 71,239
Treasury stock, at cost................................... (9,092) (9,092)
Accumulated other comprehensive loss...................... (3,059) (4,252)
Unearned compensation -- restricted stock awards.......... (133) (273)
-------- --------
125,586 124,967
-------- --------
$627,421 $590,376
======== ========
</Table>

Note: The balance sheet at December 31, 2001 has been derived from the audited
financial statements at that date, but does not include all of the
information and footnotes required by generally accepted accounting
principles for complete financial statements.

See notes to consolidated financial statements.

PARK-OHIO HOLDINGS CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

<Table>
<Caption>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30 SEPTEMBER 30
----------------------- -----------------------
2002 2001 2002 2001
---------- ---------- ---------- ----------
(AMOUNTS IN THOUSANDS -- EXCEPT PER SHARE DATA)

Net sales.......................................... $157,832 $156,183 $478,300 $489,756
Cost of products sold.............................. 134,639 132,534 409,029 414,023
-------- -------- -------- --------
Gross profit..................................... 23,193 23,649 69,271 75,733
Selling, general and administrative expenses....... 14,496 16,696 43,450 51,276
Amortization of goodwill........................... -0- 941 -0- 2,798
Restructuring and other non-recurring expenses..... 1,006 709 5,262 1,012
-------- -------- -------- --------
Operating income................................. 7,691 5,303 20,559 20,647
Interest expense................................... 7,024 7,856 20,663 23,656
Non-operating expenses............................. -0- -0- -0- 1,850
-------- -------- -------- --------
Income (loss) before income taxes................ 667 (2,553) (104) (4,859)
Income tax (benefit)............................... 909 147 610 (925)
-------- -------- -------- --------
Net loss......................................... $ (242) $ (2,700) $ (714) $ (3,934)
======== ======== ======== ========
Net loss per common share:
Basic............................................ $ (.02) $ (.26) $ (.07) $ (.38)
======== ======== ======== ========
Diluted.......................................... $ (.02) $ (.26) $ (.07) $ (.38)
======== ======== ======== ========
Common shares used in the computation:
Basic............................................ 10,434 10,434 10,434 10,434
======== ======== ======== ========
Diluted.......................................... 10,434 10,434 10,434 10,434
======== ======== ======== ========
</Table>

See notes to consolidated financial statements.

PARK-OHIO HOLDINGS CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY (UNAUDITED)

<Table>
<Caption>
ACCUMULATED
OTHER
COMMON PAID-IN RETAINED TREASURY COMPREHENSIVE UNEARNED
STOCK CAPITAL EARNINGS STOCK INCOME(LOSS) COMPENSATION TOTAL
------- ------- --------- -------- -------------- ------------ --------
(DOLLARS IN THOUSANDS)

Balance January 1, 2002.... $11,210 $56,135 $71,239 $(9,092) $(4,252) $(273) $124,967
Comprehensive income
(loss):
Net loss................. (714) (714)
Foreign currency
translation
adjustment............. 1,193 1,193
--------
Comprehensive income
(loss)................. 479
Amortization of restricted
stock.................... 140 140
------- ------- ------- ------- ------- ----- --------
Balance September 30,
2002..................... $11,210 $56,135 $70,525 $(9,092) $(3,059) $(133) $125,586
======= ======= ======= ======= ======= ===== ========
</Table>

See notes to consolidated financial statements.

PARK-OHIO HOLDINGS CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

<Table>
<Caption>
NINE MONTHS ENDED
SEPTEMBER 30
-----------------------
2002 2001
---------- ----------
(DOLLARS IN THOUSANDS)

OPERATING ACTIVITIES
Net loss.................................................. $ (714) $ (3,934)
Adjustments to reconcile net loss to net cash provided by
operating activities:
Depreciation and amortization.......................... 12,720 15,369
Changes in operating assets and liabilities, excluding
acquisitions of businesses:
Accounts receivable.................................... (17,461) 8,327
Inventories and other current assets................... 5,467 12,179
Accounts payable and accrued expenses.................. 28,507 (16,117)
Other.................................................. (10,875) (11,427)
-------- --------
Net Cash Provided by Operating Activities............ 17,644 4,397
INVESTING ACTIVITIES
Purchases of property, plant and equipment, net........... (10,195) (10,983)
Proceeds from sale of Castle Rubber....................... 2,486 -0-
Costs of acquisitions, net of cash acquired............... (5,748) -0-
-------- --------
Net Cash Used by Investing Activities.................. (13,457) (10,983)
FINANCING ACTIVITIES
Proceeds from bank arrangements........................... 1,510 19,000
Payments on debt.......................................... (2,604) (12,084)
-------- --------
Net Cash (Used) Provided by Financing Activities....... (1,094) 6,916
-------- --------
Increase in Cash and Cash Equivalents....................... 3,093 330
Cash and Cash Equivalents at Beginning of Period............ 3,872 2,612
-------- --------
Cash and Cash Equivalents at End of Period.................. $ 6,965 $ 2,942
======== ========
Taxes refunded.............................................. $ (4,207) $ (1,509)
Interest paid............................................... 14,560 17,705
</Table>

See notes to consolidated financial statements.

PARK-OHIO HOLDINGS CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

SEPTEMBER 30, 2002

(AMOUNTS IN THOUSANDS -- EXCEPT PER SHARE DATA)

NOTE A -- BASIS OF PRESENTATION

The consolidated financial statements include the accounts of Park-Ohio
Holdings Corp. and its subsidiaries ("the Company"). All significant
intercompany transactions have been eliminated in consolidation.

The accompanying unaudited consolidated financial statements have been
prepared in accordance with accounting principles generally accepted for interim
financial information and with the instructions to Form 10-Q and Article 10 of
Regulation S-X. Accordingly, they do not include all of the information and
footnotes required by accounting principles generally accepted in the United
States for complete financial statements. In the opinion of management, all
adjustments (consisting of normal recurring accruals) considered necessary for a
fair presentation have been included. Operating results for the three-month and
nine-month periods ended September 30, 2002 are not necessarily indicative of
the results that may be expected for the year ending December 31, 2002. For
further information, refer to the consolidated financial statements and
footnotes thereto included in the Company's Annual Report on Form 10-K for the
year ended December 31, 2001.

Certain amounts have been reclassified to conform to current year presentation.

NOTE B -- DISPOSITIONS AND ACQUISITION

On December 21, 2001, the Company completed the sale of substantially all
of the assets of Cleveland City Forge for cash of approximately $6.1 million.
Cleveland City Forge was a non-core business in the Manufactured Products
Segment, producing clevises and turnbuckles for the construction industry.

On April 26, 2002, the Company completed the sale of substantially all of
the assets of Castle Rubber Company for cash of approximately $2.5 million.
Castle Rubber, a non-core business in the Manufactured Products Segment, had
been identified as a business the Company was discontinuing as part of its
restructuring activities during 2001.

On September 10, 2002, the Company acquired substantially all of the assets
of Ajax Magnethermic Corporation ("Ajax"), a manufacturer of induction heating
and melting equipment. The purchase price of approximately $5.0 million and the
results of operations of Ajax prior to its date of acquisition was not deemed
significant as defined in Regulation S-X.

NOTE C -- INVENTORIES

The components of inventory consist of the following:

<Table>
<Caption>
SEPTEMBER 30 DECEMBER 31
2002 2001
------------ -----------

In process and finished goods............................... $138,894 $137,021
Raw materials and supplies.................................. 14,749 14,442
-------- --------
$153,643 $151,463
======== ========
</Table>

NOTE D -- SHAREHOLDERS' EQUITY

At September 30, 2002, capital stock consists of (i) Serial Preferred Stock
of which 632,470 shares were authorized and none were issued and (ii) Common
Stock of which 40,000,000 shares were authorized and 10,496,191 shares were
issued and outstanding.

PARK-OHIO HOLDINGS CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) -- CONTINUED

NOTE E -- NET LOSS PER COMMON SHARE

The following table sets forth the computation of basic and diluted net
loss per share:

<Table>
<Caption>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30 SEPTEMBER 30
------------------- -------------------
2002 2001 2002 2001
------- ------- ------- -------

NUMERATOR
Net loss................................. $ (242) $(2,700) $ (714) $(3,934)
======= ======= ======= =======
DENOMINATOR
Denominator for basic earnings per
share -- weighted average shares....... 10,434 10,434 10,434 10,434
Effect of dilutive securities:
Employee stock options and awards...... -0-(a) -0-(a) -0-(a) -0-(a)
------- ------- ------- -------
Denominator for diluted earnings per
share -- adjusted weighted average
shares and assumed conversions......... 10,434 10,434 10,434 10,434
======= ======= ======= =======
Net loss per common share -- basic....... $ (.02) $ (.26) $ (.07) $ (.38)
======= ======= ======= =======
Net loss per common share -- diluted..... $ (.02) $ (.26) $ (.07) $ (.38)
======= ======= ======= =======
</Table>

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

(a) The addition of 445 and 28 shares for the three months ended September 30,
2002 and 2001, respectively, and 445 and 28 shares for the nine months ended
September 30, 2002 and 2001, respectively, would result in anti-dilution.

NOTE F -- ACCOUNTING PRONOUNCEMENTS

The Company adopted Financial Accounting Standard No. 142 "Goodwill and
Other Intangible Assets" ("FAS 142") as of January 1, 2002. Under FAS 142, the
Company no longer amortizes goodwill, but is required to review goodwill for
impairment annually, or more frequently if impairment indicators arise.

In accordance with FAS 142, prior period amounts were not restated. A
reconciliation of the previously reported net income (loss) and earnings (loss)
per share for the three months and nine months ended September 30, 2001 to the
amounts adjusted for the reduction of amortization expense is as follows:

<Table>
<Caption>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, 2001 SEPTEMBER 30, 2001
------------------------------- -------------------------------
BASIC DILUTED BASIC DILUTED
NET EARNINGS EARNINGS NET EARNINGS EARNINGS
INCOME (LOSS) (LOSS) INCOME (LOSS) (LOSS)
(LOSS) PER SHARE PER SHARE (LOSS) PER SHARE PER SHARE
------- --------- --------- ------- --------- ---------

Reported........................ $(2,700) $(.26) $(.26) $(3,934) $(.38) $(.38)
Add: Amortization adjustment.... 941 .09 .09 2,798 .27 .27
------- ----- ----- ------- ----- -----
Adjusted........................ $(1,759) $(.17) $(.17) $(1,136) $(.11) $(.11)
======= ===== ===== ======= ===== =====
</Table>

Pursuant to the adoption of FAS 142, the Company has completed the initial
valuation analysis required by the transitional goodwill impairment tests which
indicates that the fair value of each of the Company's three reporting units as
of January 1, 2002 was less than the carrying value for financial reporting
purposes and that up to $50 million of goodwill is impaired. Once the
transitional impairment tests have been completed, the related non-cash
impairment charge will be recorded by December 31, 2002 and reflected as a
cumulative

PARK-OHIO HOLDINGS CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) -- CONTINUED

effect of a change in accounting principle. This non-cash transitional
impairment charge will have no effect on the future operating results of the
company.

In October 2001, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets" ("FAS 144"), which supercedes FAS 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to
be Disposed Of". Although retaining many of the fundamental impairment and
measurement provisions of FAS 121, the new rules supercede the provisions of APB
Opinion 30 with regard to reporting the effects of a disposal of a segment of a
business. The adoption of this standard by the Company on January 1, 2002 did
not impact the Company's financial position, results of operations or cash
flows.

In April 2002, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 145, "Rescission of FASB Statements No. 4, 44
and 64, Amendment of FASB Statement No. 13, and Technical Corrections," ("FAS
145"). FAS 145 rescinds FAS 4 and FAS 64 related to classification of gains and
losses on debt extinguishment such that most debt extinguishment gains and
losses will no longer be classified as extraordinary. FAS 145 also amends FAS 13
with respect to sales-leaseback transactions. The Company adopted the provisions
of FAS 145 effective April 1, 2002, and the adoption had no impact on the
Company's reported results of operations or financial position.

In June 2002, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 146, "Accounting for Costs Associated with
Exit or Disposal Activities," ("FAS 146"), which addresses financial accounting
and reporting for costs associated with exit or disposal activities and
nullifies Emerging Issues Task Force (EITF) Issue No. 94-3, "Liability
Recognition for Certain Employee Termination Benefits and Other Costs to Exit an
Activity (including Certain Costs Incurred in a Restructuring)." FAS 146
requires that liability for a cost that is associated with an exit or disposal
activity be recognized when a legal liability is incurred. FAS 146 also
establishes that fair value is the objective for the initial measurement of the
liability. FAS 146 is effective for exit and disposal activities that are
initiated after December 31, 2002. It is currently the Company's policy to
recognize restructuring costs as announced in December 2001 in accordance with
EITF Issue No. 94-3.

NOTE G -- INDUSTRY SEGMENTS

The Company operates through three segments. Integrated Logistics Solutions
("ILS"), Aluminum Products and Manufactured Products. ILS is a leading logistics
provider of production components to large, multinational manufacturing
companies, other manufacturers and distributors. In connection with the supply
of such production components, ILS provides a variety of value-added,
cost-effective supply chain management services. The principal customers of ILS
are in the semiconductor equipment, technology, industrial equipment, aerospace
and defense, electrical controls, HVAC, heavy-duty truck, vehicle parts and
accessories, appliances and motors, and lawn and garden equipment industries.
Aluminum Products manufactures cast aluminum components for automotive,
agricultural equipment, heavy-duty truck and construction equipment. Aluminum
Products also provides value-added services such as design and engineering,
machining and assembly. Manufactured Products operates a diverse group of niche
manufacturing businesses that design and manufacture a broad range of high
quality products engineered for specific customer applications. The principal
customers of Manufactured Products are equipment manufacturers and end-users in
the aerospace, automotive, railroad, truck and oil industries. Intersegment
sales are immaterial.

PARK-OHIO HOLDINGS CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) -- CONTINUED

Results by business segment were as follows:

<Table>
<Caption>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30 SEPTEMBER 30
------------------- -------------------
2002 2001 2002 2001
-------- -------- -------- --------

Net sales
ILS...................................... $104,769 $ 97,817 $304,511 $324,137
Aluminum products........................ 24,729 20,545 81,232 62,503
Manufactured products.................... 28,334 37,821 92,557 103,116
-------- -------- -------- --------
$157,832 $156,183 $478,300 $489,756
======== ======== ======== ========
Income (loss) before income taxes:
ILS...................................... $ 7,676 $ 5,303 $ 18,042 $ 21,649
Aluminum products........................ 1,367 (773) 5,118 (1,908)
Manufactured products.................... (115) 2,485 1,053 5,567
-------- -------- -------- --------
8,928 7,015 24,213 25,308
Corporate costs.......................... (1,237) (1,712) (3,654) (4,661)
Interest expense......................... (7,024) (7,856) (20,663) (23,656)
Non-operating expenses................... 0 0 0 (1,850)
-------- -------- -------- --------
$ 667 $ (2,553) $ (104) $ (4,859)
======== ======== ======== ========
</Table>

<Table>
<Caption>
SEPTEMBER 30 DECEMBER 31
2002 2001
------------ -----------

Identifiable assets were as follows:
ILS....................................................... $324,652 $305,493
Aluminum products......................................... 109,581 94,311
Manufactured products..................................... 159,075 125,837
General corporate......................................... 12,476 42,002
Net assets held for sale.................................. 21,637 22,733
-------- --------
$627,421 $590,376
======== ========
</Table>

NOTE H -- COMPREHENSIVE INCOME (LOSS)

Total comprehensive income (loss) was as follows:

<Table>
<Caption>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30 SEPTEMBER 30
------------------ ------------------
2002 2001 2002 2001
------ -------- ------- --------

Net loss........................................ $(242) $(2,700) $ (714) $(3,934)
Foreign currency translation.................... (697) 163 1,193 (1,076)
----- ------- ------ -------
Total comprehensive income (loss)............... $(939) $(2,537) $ 479 $(5,010)
===== ======= ====== =======
</Table>

NOTE I -- NON-OPERATING EXPENSES

In June 2000, the Company's Cicero Flexible Products plant was destroyed in
a fire. In the first nine months of 2001, the Company expensed $1.85 million of
non-recurring business interruption costs, which were not covered by insurance.

PARK-OHIO HOLDINGS CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) -- CONTINUED

NOTE J -- RESTRUCTURING ACTIVITIES

During 2001, the Company recorded pretax charges of $28.5 million (of which
$6.9 million related to severance and exit costs) as a result of a restructuring
plan aimed at positioning the Company for stronger profitability. The charges
consisted of asset write-downs, employee termination and severance costs related
to workforce reductions of approximately 525 employees, and other exit costs
related to the shutdown of facilities. The Company continues to re-evaluate the
asset write-down reserves and severance and exit cost liabilities, and expects
to substantially complete these restructuring actions in 2002. For further
details on the restructuring plan, see Note M to the audited financial
statements contained in the Company's Annual Report on Form 10-K for the year
ended December 31, 2001.

The accrued liability balance for severance and exit costs and related cash
payments consisted of:

<Table>

Severance and exit charges recorded in 2001................. $ 6,883
Cash payments made in 2001.................................. (2,731)
-------
Balance at December 31, 2001................................ 4,152
Severance and exit charges recorded in 2002................. 1,904
Cash payments made in 2002.................................. (4,982)
-------
Balance at September 30, 2002............................... $ 1,074
=======
</Table>

As of September 30, 2002, all of the 525 employees identified in 2001 had
been terminated. Severance costs related to additional work force reductions of
327 employees were recorded in the first nine months of 2002. The workforce
reductions under the restructuring plan consisted of hourly and salaried
employees at various operating facilities due to either closure or
consolidation.

Net sales for Ajax Manufacturing (business held for sale) were $3,527 and
$4,625 for the nine months ended September 30, 2002 and 2001, respectively.
Operating income (loss) for this entity was $(762) and $221 for the nine months
ended September 30, 2002 and 2001, respectively.

During the second quarter of 2002 the Company sold Castle Rubber for $2.5
million and completed the closure of a manufacturing facility. The difference
between the proceeds received and the carrying value of net assets sold was
charged to asset write-down reserves established in 2001. Included in
restructuring and other non-recurring expenses is a $2.7 million charge for the
curtailment of the two pension plans at these facilities, as determined by
consulting actuaries.

INDEPENDENT ACCOUNTANTS' REVIEW REPORT

Board of Directors and Shareholders
Park-Ohio Holdings Corp.

We have reviewed the accompanying consolidated balance sheet of Park-Ohio
Holdings Corp. and subsidiaries as of September 30, 2002 and the related
consolidated statements of operations for the three-month and nine-month periods
ended September 30, 2002 and 2001, the consolidated statement of shareholders'
equity for the nine-month period ended September 30, 2002 and the consolidated
statements of cash flows for the nine-month periods ended September 30, 2002 and
2001. These financial statements are the responsibility of the Company's
management.

We conducted our reviews in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of 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 auditing standards generally accepted in the United States,
which will be performed for the full year with the objective of expressing an
opinion regarding the financial statements taken as a whole. Accordingly, we do
not express such an opinion.

Based upon our reviews, 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.

As discussed in Note F to the consolidated financial statements, effective
January 1, 2002, the Company changed its method of accounting for goodwill.

We have previously audited, in accordance with auditing standards generally
accepted in the United States, the consolidated balance sheet of Park-Ohio
Holdings Corp. and subsidiaries as of December 31, 2001 and the related
consolidated statements of operations, shareholders' equity, and cash flows for
the year then ended, not presented herein, and in our report dated March 1,
2002, we expressed an unqualified opinion on those consolidated financial
statements. In our opinion, the information set forth in the accompanying
consolidated balance sheet as of December 31, 2001, is fairly stated, in all
material respects, in relation to the consolidated balance sheet from which it
has been derived.

/s/Ernst & Young LLP

Cleveland, Ohio
November 11, 2002

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

The consolidated financial statements of the Company include the accounts
of Park-Ohio Holdings Corp. and its subsidiaries. All significant intercompany
transactions have been eliminated in consolidation. Financial information for
the three-month and nine-month periods ended September 30, 2002 is not directly
comparable to the financial information for the same three-month and nine-month
periods in 2001, for several reasons. Effective January 1, 2002, the Company no
longer amortizes goodwill. Goodwill amortization was $941 thousand and $2.8
million in the third quarter and first nine months of 2001, respectively.

During third quarter 2002, the Company continued its announced
restructuring activities and recorded $1.0 million of restructuring charges. In
the first and second quarters of 2001, the Company expensed $950 thousand and
$900 thousand respectively, of non-recurring business-interruption costs related
to a June 2000 fire, which destroyed the Company's Cicero Flexible Products
plant. During third quarter 2001, the Company recorded $.7 million of
restructuring charges.

The Company sold substantially all the assets of Cleveland City Forge on
December 21, 2001 for cash of approximately $6.1 million. The Company sold
substantially all the assets of Castle Rubber Company on April 26, 2002 for cash
of approximately $2.5 million. The Company acquired substantially all the assets
of Ajax Magnethermic Corp. on September 10, 2002 for cash of approximately $5.0
million.

OVERVIEW

The Company's sales volumes and profitability declined during 2001, due to
overall weakness in the manufacturing economy, and particularly to contraction
in the heavy-duty truck and automotive industries. Despite these sales declines,
the Company believes it has retained or gained market share in most major
markets served. The Company responded to this economic downturn by reducing
costs, increasing prices on targeted products, restructuring businesses and
selling non-core manufacturing assets. The Company restructured many of its
businesses, including planned closure of twenty logistics warehouses and closure
or sale of eight manufacturing plants. With regard to these actions, in 2001 the
Company recorded restructuring and impairment charges of $28.5 million.

The Company's 2002 quarterly sales have increased compared to the fourth
quarter of 2001 and the company has earned a profit in the first nine months of
2002 (excluding non-cash pension plan curtailment charges resulting from the
closure of a plant in the second quarter). During 2002, the Company has
continued to reduce costs and restructure its businesses as previously planned,
including closing or consolidating eight logistics warehouses, and one
manufacturing plant, and selling Castle Rubber.

On January 1, 2002 the Company adopted Statement of Financial Accounting
Standards No. 142 "Goodwill and Other Intangible Assets" ("FAS 142"). Under FAS
142, goodwill and intangible assets with indefinite lives are no longer
amortized, but are reviewed for impairment annually, or more frequently if
impairment indicators arise.

Pursuant to FAS 142, the Company has completed the initial valuation
analysis required by the transitional goodwill impairment tests which indicates
that the fair value of each of the Company's three reporting units as of January
1, 2002 was less than the carrying value for financial reporting purposes and
that up to $50 million of the goodwill is impaired. Once the transitional
impairment tests have been completed, the related non-cash impairment charge
will be recorded by December 31, 2002, and reflected as a cumulative effect of a
change in accounting principle. This non-cash transitional impairment charge
will have no effect on the future operating results of the Company.

RESULTS OF OPERATIONS

Nine Months 2002 versus Nine Months 2001

Net sales declined by $11.5 million, or 2%, to $478.3 million for the first
nine months of 2002, from $489.8 million for the same period in 2001. ILS net
sales declined 6%, or $19.6 million, due primarily to the current economic
downturn. Aluminum Products net sales increased 30%, or $18.7 million. This
increase

included $12.2 million in new production contracts and $13.2 million from higher
volumes and price increases in ongoing contracts, partially offset by a $6.7
million decrease relating to the ending of certain production contracts.
Manufactured Products net sales decreased 10%, or $10.6 million, primarily due
to the sale of Cleveland City Forge and Castle Rubber.

Gross profit declined by $6.4 million, or 8%, to $69.3 million for the
first nine months of 2002, from $75.7 million for the same period in 2001. Of
this decline, approximately $5.2 million was attributable to organic sales
decreases and the remainder to divestitures. The Company's consolidated gross
margin declined to 14.5% for the first nine months of 2002, from 15.5% for the
first nine months of 2001. ILS gross margin declined despite cost reductions,
due to the absorption of fixed operational overheads over a smaller sales base
and pricing pressure. Aluminum Products gross margins increased significantly,
due to the absorption of fixed manufacturing overheads over a larger production
base, cost reductions and higher margins on new contracts. Gross margins in the
Manufactured Products segment decreased primarily due to pricing pressure, the
absorption of fixed overhead over a smaller sales base and the divestiture of
the high-margin sales of Cleveland City Forge.

Selling, general and administrative expenses ("SG&A") decreased by 15% or
$7.8 million, to $43.5 million for the first nine months of 2002 from $51.3
million for the same period in 2001. SG&A decreased through cost reductions in
the ILS and Manufactured Products segments, while the Aluminum Products segment
remained unchanged despite a 30% sales increase. Manufactured Products SG&A was
reduced by $1.1 million in the first nine months 2002 due to the sale of
Cleveland City Forge and Castle Rubber. During the first nine months of 2002,
SG&A was negatively affected by a decrease of $.9 million in net pension
credits, reflecting less favorable investment returns on pension plan assets.
Consolidated SG&A expenses as a percentage of net sales were 9.1% for the first
nine months of 2002 as compared to 10.5% for the same period in 2001.
Amortization of goodwill (reported separately from SG&A for clarity) has been
eliminated in 2002, in accordance with FAS 142, eliminating $2.8 million of year
to date expenses.

Interest expense decreased $3.0 million to $20.7 for the first nine months
of 2002, from $23.7 million in the same period of 2001 due to lower average debt
outstanding and lower average interest rates in 2002. During the first nine
months of 2002, the Company averaged outstanding borrowings of $333.7 million as
compared to $356.8 million for the corresponding period of 2001. The $23.1
million decrease related primarily to lower working capital levels in ongoing
units and cash from the sale of Cleveland City Forge and Castle Rubber. The
average interest rate of 8.26% for the first nine months was 58 basis points
lower than the average rate of 8.84% for same period in 2001, primarily due to
decreased rates on the Company's revolving credit facility.

Despite a loss before income tax of $.1 million, the Company recorded a $.6
million income tax provision for the first nine months of 2002, due to foreign
taxes and a foreign tax rate difference in foreign subsidiaries, and a reduced
tax benefit from the Company's foreign sales corporations. In the first nine
months of 2001, the effective income tax rate was 19%. This low rate resulted
from the tax-rate impact of permanent tax items which are not deductible such as
the amortization of goodwill (discontinued in 2002), given the pretax loss
during the first nine months of 2001.

Third Quarter 2002 versus Third Quarter 2001

Net sales grew by $1.6 million, or 1%, to $157.8 million in third quarter
2002, from $156.2 million for the same quarter in 2001. ILS net sales grew 7%,
or $7.0 million, due primarily to growth in heavy truck and other customer
industries. Aluminum Products net sales increased 20%, or $4.2 million. This
increase included $4.5 million in new production contracts and $3.7 million from
higher volumes and price increases in ongoing contracts, partially offset by a
$4.0 million decrease relating to the ending of certain production contracts.
Manufactured Products net sales decreased 25%, or $9.5 million, due to the sale
of Cleveland City Forge and Castle Rubber, and lower sales in capital equipment
units.

Gross profit declined by $.4 million, or 2%, to $23.2 million for third
quarter 2002, from $23.6 million for the same quarter in 2001. Of this decline,
approximately $.2 million was attributable to organic sales decreases and the
remainder to divestitures. The Company's consolidated gross margin declined to
approximately 14.7%
15

for third quarter 2002, from 15.1% for same quarter in 2001. ILS gross margin
increased slightly due to cost reductions and the accelerated termination of a
sales contract with a high margin. Aluminum Products gross margins increased
significantly, due to the absorption of fixed manufacturing overheads over a
larger production base, cost reductions and higher margins on new contracts.
Gross margins in the Manufactured Products segment decreased due to pricing
pressure, the absorption of fixed manufacturing overhead over a smaller sales
base and the divestiture of the high-margin sales of Cleveland City Forge.

Selling, general and administrative expenses ("SG&A") decreased by 13% or
$2.2 million, to $14.5 million for third quarter 2002 from $16.7 million for the
same period in 2001. SG&A decreased through cost reductions in all three
segments. Manufactured Products SG&A was reduced by $.4 million in third quarter
2002 due to the sales of Cleveland City Forge and Castle Rubber. During the
third quarter of 2002, SG&A was negatively affected by a decrease of $.3 million
in net pension credits, reflecting less favorable investment returns on pension
plan assets. Consolidated SG&A expenses as a percentage of net sales were 9.2%
for third quarter 2002 as compared to 10.7% for the same quarter in 2001.
Amortization of goodwill (reported separately from SG&A for clarity) has been
eliminated in 2002, in accordance with FAS 142, eliminating $.9 million of third
quarter expenses.

Interest expense decreased $.9 million to $7.0 million for third quarter
2002, from $7.9 million for the same quarter in 2001 due to lower average debt
outstanding and lower average interest rates in 2002. During third quarter 2002,
the Company averaged outstanding borrowings of $331.7 million as compared to
$356.3 million for the corresponding quarter of the 2001. The $24.6 million
decrease related primarily to lower working capital levels in ongoing units and
cash from the sale of Cleveland City Forge and Castle Rubber. The average
interest rate of 8.47% for the current quarter was 35 basis points lower than
the average rate of 8.82% for third quarter 2001, primarily due to decreased
rates on the Company's revolving credit facility.

The effective income tax rate for third quarter 2002 was over 100%,
including a $.4 million tax provision adjustment for the first two quarters of
2002 based on revised estimates of foreign taxes and a foreign tax rate
difference in the Company's foreign subsidiaries, and a reduced tax benefit from
the Company's foreign sales corporations. In the same quarter of 2001, the
Company recorded a $.1 million tax provision despite a loss before income taxes,
as a result of the third quarter 2001 reduction of the estimated income tax rate
to 19%. This change, which reduced the third quarter 2001 income tax benefit by
$.6 million, resulted from the tax rate impact of permanent tax items which are
not deductible, such as the amortization of goodwill (discontinued in 2002),
given the pretax loss estimated for 2001.

LIQUIDITY AND SOURCES OF CAPITAL

The Company's liquidity needs are primarily for working capital and capital
expenditures. The Company's primary sources of liquidity have been funds
provided by operations and funds available from existing bank credit
arrangements and the sale of Senior Subordinated Notes. The Company is party to
a credit and security agreement dated December 21, 2000, as amended ("Credit
Agreement"), with a group of banks under which it may borrow up to $160 million
secured by substantially all the assets of the Company. The proceeds from the
Credit Agreement, which expires on June 30, 2004, will be used for general
corporate purposes. Amounts borrowed under the Credit Agreement may be borrowed
at Park-Ohio's election at either (i) the bank's prime lending rate plus up to
50-150 basis points or (ii) LIBOR plus 275-350 basis points. The Company's
ability to select LIBOR-based interest and the interest rate are dependent on
the Company's ratio of senior funded indebtedness to EBITDA, as defined in the
credit agreement.

A detailed borrowing base formula was defined in the fifth amendment to the
Credit Agreement, dated September 30, 2002. This borrowing base provides
borrowing capacity to the Company based on percentages of eligible accounts
receivable, inventory and fixed assets. As of September 30, 2002, the Company
could have borrowed up to the full $160.0 million. As of September 30, 2002, the
Company was limited to prime-based borrowings (5.75% at that date) and $125.0
million was outstanding under the facility.

Current financial resources (working capital and available bank borrowing
arrangements) and anticipated funds from operations are expected to be adequate
to meet current cash requirements. The future availability of bank borrowings is
based on the Company's ability to meet various financial covenants, which could
be
16

materially impacted in the event of a renewal of negative economic trends.
Failure to meet financial covenants could materially impact the availability and
interest rate of future borrowings. At September 30, 2002, the Company is in
compliance with all financial covenants under the Credit Agreement.

The ratio of current assets to current liabilities was 2.23 at September
30, 2002 versus 2.85 at December 31, 2001. Working capital decreased by $12.2
million to $168.1 million at September 30, 2002 from $180.3 million at December
31, 2001.

During the first nine months of 2002, the Company provided $17.6 million
from operating activities as compared to $4.4 million for the same period in
2001. During the first nine months of 2002, the Company invested $10.2 million
in capital expenditures and $5.7 million for acquisitions, and received $2.5
million from the sale of Castle Rubber. These activities, less a net pay-down of
borrowings of $1.1 million, resulted in an increase in cash during first nine
months of 2002 of $3.1 million.

SEASONALITY; VARIABILITY OF OPERATING RESULTS

The Company's results of operations are typically stronger in the first six
months rather than the last six months of each calendar year due to scheduled
plant maintenance in the third quarter to coincide with customer plant shutdowns
and to holidays in the fourth quarter.

The timing of orders placed by the Company's customers has varied with,
among other factors, orders for customers' finished goods, customer production
schedules, competitive conditions and general economic conditions. The
variability of the level and timing of orders has, from time to time, resulted
in significant periodic and quarterly fluctuations in the operations of the
Company's business units. Such variability is particularly evident at the
capital equipment businesses, included in the Manufactured Products segment,
which typically ship a few large systems per year.

FORWARD-LOOKING STATEMENTS

This Form 10-Q contains certain statements that are "forward-looking
statements" within the meaning of Section 27A of the Securities Act and Section
21E of the Exchange Act. Certain statements in this Management's Discussion and
Analysis of Financial Condition and Results of Operations contain forward-
looking statements, including without limitation, discussion regarding the
Company's anticipated amounts of restructuring charges, credit availability,
levels and funding of capital expenditures and trends for the remainder of 2002.
Forward-looking statements are necessarily subject to risks, uncertainties and
other factors, many of which are outside our control, which could cause actual
results to differ materially from such statements. These uncertainties and other
factors include such things as: general business conditions, competitive
factors, including pricing pressures and product innovation and quality; raw
material availability and pricing; changes in our relationships with customers
and suppliers; the ability of the Company to successfully integrate recent and
future acquisitions into its existing operations; changes in general domestic
economic conditions such as inflation rates, interest rates, foreign currency
exchange rates; tax rates and adverse impacts to us, our suppliers and customers
from acts of terrorism or hostilities; our ability to meet various covenants,
including financial covenants, contained in our credit agreement and the
indenture governing the Senior Subordinated Notes; increasingly stringent
domestic and foreign governmental regulations including those affecting the
environment; inherent uncertainties involved in assessing our potential
liability for environmental remediation-related activities; the outcome of
pending and future litigation and other claims; dependence on the automotive and
heavy truck industries; dependence on key management; and dependence on
information systems. Any forward-looking statement speaks only as of the date on
which such statement is made, and we undertake no obligation to update any
forward-looking statement, whether as a result of new information, future events
or otherwise. In light of these and other uncertainties, the inclusion of a
forward-looking statement herein should not be regarded as a representation by
us that the our plans and objectives will be achieved.

REVIEW BY INDEPENDENT ACCOUNTANTS

The consolidated financial statements at September 30, 2002, and for the
three-month and nine-month periods ended September 30, 2002 and 2001, have been
reviewed, prior to filing, by Ernst & Young LLP, the Company's independent
accountants, and their report is included herein.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

The Company is exposed to market risk including changes in interest rates.
The Company is subject to interest rate risk on its floating rate revolving
credit facility which consisted of borrowings of $121 million at September 30,
2002. A 100 basis point increase in the interest rate would have resulted in an
increase in interest expense of approximately $.9 million during the nine-month
period ended September 30, 2002.

The Company's foreign subsidiaries generally conduct business in local
currencies. During the first nine months of 2002, the Company recorded a
favorable foreign currency translation adjustment of $1.2 million related to net
assets located outside the United States. This foreign currency translation
adjustment resulted primarily from the weakening of the United States dollar in
relation to the Canadian dollar and the euro. Our foreign operations are also
subject to other customary risks of operating in a global environment, such as
unstable political situations, the effect of local laws and taxes, tariff
increases and regulations and requirements for export licenses, the potential
imposition of trade or foreign exchange restrictions and transportation delays.

ITEM 4. CONTROLS AND PROCEDURES

(a) Evaluation of disclosure controls and procedures.

The Company's chief executive officer and chief financial officer, after
evaluating the effectiveness of the Company's "disclosure controls and
procedures" (as defined in the Securities Exchange Act of 1934 Rules 13a-14(c)
and 15d-14(c)) as of a date (the "Evaluation Date") within 90 days before the
filing date of this quarterly report, have concluded that as of the Evaluation
Date, the Company's disclosure controls and procedures were effective and
designed to ensure that material information relating to the Company and the
Company's consolidated subsidiaries would be made known to them by others within
those entities.

(b) Changes in internal controls.

There were no significant changes in the Company's internal controls or in
other factors that could significantly affect those controls subsequent to the
Evaluation Date.

PART II

OTHER INFORMATION

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

There were no matters submitted to a vote of security holders during the
third quarter of 2002.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

The following exhibits are included herein:

(4) Fifth amendment, dated September 30, 2002, to the Credit and
Security Agreement among Park-Ohio Industries, Inc. and various
financial institutions

(15) Letter re: unaudited financial information

(99) Certification requirement under Section 906 of the Sarbanes-Oxley
Act of 2002

The Company did not file any reports on Form 8-K during the three months
ended September 30, 2002.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.

PARK-OHIO HOLDINGS CORP.
------------------------------------
(Registrant)

By /s/ RICHARD P. ELLIOTT
-----------------------------------
Name: Richard P. Elliott
Title: Vice President and Chief
Financial Officer (Principal
Financial and Accounting
Officer)

Dated November 13, 2002
---------------------------------

CERTIFICATION

I, Edward F. Crawford, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Park-Ohio
Holdings Corp.;

2. Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to
the period covered by this quarterly report;

3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and
cash flows of the registrant as of, and for, the periods presented in
this quarterly report;

4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and
we have:

a. designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within
those entities, particularly during the period in which this
quarterly report is being prepared;

b. evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date
of this quarterly report (the "Evaluation Date"); and

c. presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;

5. The registrant's other certifying officers and I have disclosed, based
on our most recent evaluation, to the registrant's auditors and the
audit committee of registrant's board of directors (or persons
performing the equivalent function):

a. all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to
record, process, summarize and report financial data and have
identified for the registrant's auditors any material weaknesses in
internal controls; and

b. any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's
internal controls; and

6. The registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in
internal controls or in other factors that could significantly affect
internal controls subsequent to the date of our most recent evaluation,
including any corrective actions with regard to significant
deficiencies and material weaknesses.

Dated: November 13, 2002

By /s/ EDWARD F. CRAWFORD
-----------------------------------
Name: Edward F. Crawford
Title: Chairman, Chief Executive
Officer and President

CERTIFICATION

I, Richard P. Elliott, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Park-Ohio
Holdings Corp.;

b. evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date
of this quarterly report (the "Evaluation Date"); and

c. presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;

b. any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's
internal controls; and

Dated: November 13, 2002

By /s/ RICHARD P. ELLIOTT
-----------------------------------
Name: Richard P. Elliott
Title: Vice President and Chief
Financial Officer

EXHIBIT INDEX

QUARTERLY REPORT ON FORM 10-Q

PARK-OHIO HOLDINGS CORP. AND SUBSIDIARIES
FOR THE QUARTER ENDED SEPTEMBER 30, 2002

<Table>
<Caption>
EXHIBIT
- -------

(4) Fifth amendment, dated September 30, 2002, to the Credit and
Security Agreement among Park-Ohio Industries, Inc. and
various financial institutions

(15) Letter re: unaudited financial information

(99) Certification requirement under Section 906 of the
Sarbanes-Oxley Act of 2002
</Table>