<PAGE>

<PAGE> 1     



                SECURITIES AND EXCHANGE COMMISSION
                      Washington, D.C. 20549



                            FORM 10-Q/A

                          AMENDMENT NO. 1

            QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
              OF THE SECURITIES EXCHANGE ACT OF 1934



For the three months ended September 30, 1997     Commission file number 1-7894



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



           California                                      95-2312900         
(State or other jurisdiction of                          (IRS Employer 
 incorporation or organization)                        Identification No.)



   10990 Wilshire Boulevard, Los Angeles, California        90024-3955      
        (Address of principal executive offices)            (Zip Code)
  

Registrant's telephone number, including area code         (213) 879-1480   


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

     As of October 31, 1996 there were 5,221,337 shares of the Registrant's
common stock outstanding.



<PAGE>
              

<PAGE> 2

                    ERLY INDUSTRIES INC. AND SUBSIDIARIES
                        CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                          September 30,       March 31,
                                              1997              1997   
                                          -------------     ------------
                                                    (Unaudited)   
                                          (As Restated)
<S>                                       <C>              <C>
Assets                                    
Current Assets:
  Cash and cash equivalents                $  4,640,000     $  5,584,000 
  Notes and accounts receivable, less
    allowance for doubtful accounts of 
    $1,551,000 (September 30) and 
    $1,326,000 (March 31)                    62,637,000       85,789,000 
  Inventories:
    Raw materials                            49,726,000       49,745,000 
    Finished goods                           88,154,000       79,950,000 
                                             ----------       ----------
                                            137,880,000      129,695,000 
  Prepaid expenses and other 
    current assets                            4,723,000        3,354,000 
                                            -----------      -----------
      Total current assets                  209,880,000      224,422,000 


Long-term notes receivable, net               1,503,000        1,503,000 
Property, plant and equipment, net           72,275,000       71,571,000 
Other assets                                 23,662,000       23,222,000 
                                           ------------     ------------
                                           $307,320,000     $320,718,000 
                                           ============     ============

Liabilities and Stockholders' Equity
Current Liabilities:
  Notes payable, collateralized            $ 85,078,000     $ 87,740,000 
  Accounts payable                           59,464,000       64,069,000 
  Accrued payroll and other 
    current liabilities                      23,111,000       23,307,000 
  Income taxes payable                        1,345,000        1,936,000 
  Current portion of long-term
    and subordinated debt                     2,518,000        1,502,000 
                                             ----------       ----------
      Total current liabilities             171,516,000      178,554,000 

Long-term debt                              107,411,000      100,584,000 
Subordinated debt                             4,665,000        4,665,000 
Deferred income taxes payable                   315,000        1,501,000
Minority interest                             5,038,000       10,634,000 
Commitments and contingencies                     

Stockholders' equity:
  Common stock, par value $.01 a share:
    Authorized: 15,000,000 shares
    Issued and outstanding:
    5,221,337 shares (September 30) 
    and 4,740,415 shares (March 31)              52,000           47,000 
  Additional paid-in capital                 28,934,000       27,533,000 
  Retained earnings (deficit)                (9,041,000)      (1,249,000)
  Cumulative foreign currency                                            
    adjustments                              (1,570,000)      (1,551,000)
                                           ------------     ------------
      Total stockholders' equity             18,375,000       24,780,000 
                                           ------------     ------------
                                           $307,320,000     $320,718,000 
                                           ============     ============

</TABLE>

See accompanying Notes to Consolidated Financial Statements and Management's
Discussion and Analysis of Financial Condition and Results of Operations.


<PAGE>
                    
<PAGE> 3 

                         ERLY INDUSTRIES INC. AND SUBSIDIARIES
                         CONSOLIDATED STATEMENTS OF OPERATIONS
             For the three and six months ended September 30, 1997 and 1996
<TABLE>                            
<CAPTION>

                                 Three months ended              Six months ended
                                    September 30,                  September 30, 
                              ---------------------------   --------------------------- 
                                   1997          1996           1997           1996     
                              ------------   ------------   ------------   ------------
                                      (Unaudited)                   (Unaudited)
                              (As Restated)                 (As Restated)
<S>                          <C>            <C>           <C>            <C>
Net sales                     $ 96,430,000   $155,966,000   $226,941,000   $280,557,000 
Cost of sales                   80,594,000    131,616,000    195,798,000    242,893,000 
                              ------------   ------------   ------------   ------------
    Gross profit                15,836,000     24,350,000     31,143,000     37,664,000 

Selling, general and 
  administrative expenses       15,161,000     13,625,000     30,584,000     25,285,000
Interest expense                 7,233,000      6,094,000     13,757,000     11,258,000 
Interest income                   (155,000)      (146,000)      (323,000)      (232,000)
Other (income) expense             163,000        (54,000)       420,000        265,000 
                                ----------     ----------     ----------     ----------
                                22,402,000     19,519,000     44,438,000     36,576,000
                                ----------     ----------     ----------     ----------

Income (loss) before taxes 
  on income and 
  minority interest             (6,566,000)     4,831,000    (13,295,000)     1,088,000 

Taxes on income                      7,000        225,000          7,000        318,000 
                                 ---------      ---------      ---------      ---------
Income (loss) before 
  minority interest             (6,573,000)     4,606,000    (13,302,000)       770,000 

Minority interest*               3,474,000        157,000      5,510,000      2,743,000
                               -----------     ----------     ----------     ----------
Net income (loss)             ($ 3,099,000)    $4,763,000    ($7,792,000)    $3,513,000 
                               ===========     ==========     ==========     ==========

Net income (loss) per share 
  of common and common
  stock equivalents:
    Primary                         ($ .61)         $ .94         ($1.58)         $ .67 
                                     =====          =====          =====          =====
   
    Fully diluted                   ($ .61)         $ .89         ($1.58)         $ .64 
                                     =====          =====          =====          =====

Weighted average common and 
  common stock equivalents:
    Primary                      5,088,000      5,041,000      4,921,000      5,225,000 
    
    Fully diluted                5,088,000      5,378,000      4,921,000      5,562,000 

</TABLE>

*  Represents minority interest in net earnings or loss of American Rice, Inc.
   applicable to common stock, after preferred stock dividend requirements (see
   Note 1).




See accompanying Notes to Consolidated Financial Statements and Management's 
Discussion and Analysis of Financial Condition and Results of Operations.


<PAGE>
                    
<PAGE> 4
                    ERLY INDUSTRIES INC. AND SUBSIDIARIES
                    CONSOLIDATED STATEMENTS OF CASH FLOWS
             For the six months ended September 30, 1997 and 1996
<TABLE>                      
<CAPTION>
                                                   Six months ended       
                                                     September 30,        
                                             ---------------------------     
                                                  1997           1996    
                                             ------------     ----------   
                                                      (Unaudited)     
                                             (As Restated)
<S>                                           <C>            <C>
OPERATING ACTIVITIES:
Net income (loss)                             ($7,792,000)    $3,513,000 
Adjustments to reconcile net
 income to net cash provided by 
 (used in) operating activities:
   Minority interest in ARI                    (5,510,000)    (2,743,000)
   Depreciation and amortization                4,729,000      4,107,000 
   Provision for loss on receivables              225,000        174,000
   Gain on redemption of warrant
    repurchase obligation                                       (387,000)    
   Change in assets and liabilities,                      
    excluding effect from acquisition
    of olive business:
    (Increase) decrease in receivables         22,927,000    (15,136,000)
    (Increase) decrease in inventories         (8,185,000)     8,863,000 
    (Increase) decrease in prepaid
      expenses and other current assets        (1,369,000)       231,000 
    Increase (decrease) in accounts 
      payable, other current 
      liabilities and taxes payable            (6,578,000)       748,000 
    Other, net                                 (1,131,000)    (1,000,000)
                                                ---------     ----------
NET CASH (USED IN) 
  OPERATING ACTIVITIES                         (2,684,000)    (1,630,000)     

INVESTING ACTIVITIES:
  Purchases of property, plant, and equipment  (4,557,000)    (2,552,000)
  Disposition of property, plant and equipment                    71,000
  Acquisition of olive business                              (33,952,000)
  Disposition of property held for sale                        2,255,000 
                                                ---------      ---------
NET CASH (USED IN)
  INVESTING ACTIVITIES                         (4,557,000)   (34,178,000)

FINANCING ACTIVITIES:                                     
  Increase (decrease) in notes payable         (2,662,0000)   38,884,000 
  Increase (decrease) in long-term                 
    and subordinated debt                        8,843,000       380,000 
  Redemption of redeemable          
    common stock warrants                                     (2,125,000)
  Proceeds from sale of stock                     116,000        100,000 
  Mortgage notes issuance cost                                    (3,000)
                                               ----------     ----------
NET CASH PROVIDED BY (USED IN)
  FINANCING ACTIVITIES                          6,297,000     37,236,000
                                               ----------     ----------
INCREASE (DECREASE) IN CASH 
  DURING THE PERIOD                              (944,000)     1,428,000 

CASH, BEGINNING OF PERIOD                       5,584,000      3,819,000 
                                              -----------    -----------
CASH, END OF PERIOD                           $ 4,640,000    $ 5,247,000 
                                              ===========    ===========

Supplemental cash flow information:
 Net cash paid during the period for:
      Interest expense                        $11,829,000    $10,289,000 
      Income taxes                            $   582,000    $   719,000 
      
</TABLE>

See accompanying Notes to Consolidated Financial Statements and Management's 
Discussion and Analysis of Financial Condition and Results of Operations.


<PAGE>
                   
<PAGE> 5



                          ERLY INDUSTRIES INC. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
                       For the six months ended September 30, 1997
                                       (Unaudited)

<TABLE>                                
<CAPTION>

                                                                   Cumulative
                     Common Stock        Additional   Retained       Foreign         Total
                  -------------------     Paid-in     Earnings      Currency     Stockholders'
                   Shares     Dollars     Capital     (Deficit)    Adjustments      Equity    
                  ---------  --------   -----------   ----------  ------------   -----------
<S>              <C>         <C>       <C>           <C>           <C>          <C>
Balance
April 1, 1997     4,740,415   $47,000   $27,533,000 ($ 1,249,000) ($1,551,000)   $24,780,000 
                                                                                    
Net income (loss)
 for the period -
 (as restated)                                        (7,792,000)                 (7,792,000)


Common stock
 issued             129,149     1,000      405,000                                   406,000     

Conversion of
 note payable
  to stock          351,773     4,000      996,000                                 1,000,000     

Foreign currency  
adjustments                                                           (19,000)       (19,000)
                  ---------  --------   -----------    ----------  -----------  ------------
Balance
September 30,      
 1997 
(unaudited) -
(as restated)     5,221,337   $52,000   $28,934,000  ($9,041,000)  ($1,570,000)  $18,375,000 
                  =========   =======   ===========   ===========  ===========  ============


</TABLE>

See accompanying Notes to Consolidated Financial Statements and Management's 
Discussion and Analysis of Financial Condition and Results of Operations.




<PAGE>
              
<PAGE> 6              

              
              ERLY INDUSTRIES INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
  For the three and six months ended September 30, 1997 and 1996

Basis of Presentation:

The information furnished is unaudited but reflects all adjustments which are,
in the opinion of management, necessary for a fair statement of results for 
the interim periods.  Results for interim periods are not necessarily 
indicative of results to be expected for the entire year.  Quarterly results 
are affected by certain seasonal factors.  Olive sales increase during 
holiday periods, most notably in the third fiscal quarter.  Forest fire 
retardant products are applied during forest fire seasons, principally the 
second fiscal quarter.

Reference should be made to the Notes To Consolidated Financial Statements in 
the Company's 1997 Form 10-K for a discussion of accounting policies and 
other significant matters.

The accompanying consolidated financial statements include the accounts of ERLY
Industries Inc. and its subsidiaries (the "Company" or "ERLY").  All 
significant intercompany accounts, intercompany profits and intercompany 
transactions are eliminated. 

Deferred income tax assets and liabilities are computed annually for 
differences between the financial statement basis and tax basis of assets and
liabilities that will result in taxable or deductible amounts in the future.
Such deferred income tax asset and liability computations are based on 
enacted tax laws and rates applicable to periods in which the differences are
expected to affect taxable income.  Valuation allowances are established when 
necessary to reduce deferred tax assets to the amount expected to be realized.
At March 31, 1997, the Company had net operating loss carryforwards for 
federal tax reporting purposes of approximately $34 million, which expire at 
various dates, primarily in years 2002 through 2011.  Tax expense reflected 
in the consolidated statements of operations represents estimated federal, 
state and foreign tax expense on pre-tax earnings reduced by the utilization 
of deferred tax assets relating to net operating loss carryforwards that had 
previously been reserved.

Primary earnings per share are based on the weighted average number of:  (1)
common shares, and (2) dilutive common share equivalents (consisting of stock
options and warrants) outstanding during each period presented.  Fully diluted
earnings per share assumes conversion of a $1 million convertible note 
payable, unless conversion would be anti-dilutive.

<PAGE>
<PAGE> 7


In February 1997, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards No. 128, "Earnings Per Share" 
("SFAS 128") which is effective for periods ending after December 15, 1997 
and specifies the computation, presentation and disclosure requirements of 
earnings per share ("EPS").  SFAS 128 requires a dual presentation of basic 
and diluted EPS.  Basic EPS, which excludes the impact of common stock 
equivalents, replaces primary EPS.  Diluted EPS, which utilizes the average 
market price per share as opposed to the greater of the average market price 
per share or ending market price per share when applying the treasury stock 
method in determining common stock equivalents, replaces fully diluted EPS.  

Pro forma basic and diluted EPS for all historical periods presented, 
assuming SFAS No. 128 was effective at the beginning of each such historical 
period, would not be materially different from the primary and fully diluted 
EPS presented. 

In June 1997, the FASB issued SFAS No. 130, "Reporting Comprehensive Income," 
and SFAS No. 131, "Disclosures About Segments of an Enterprise and Related
Information."  SFAS No. 130 establishes standards for reporting and displaying
of comprehensive income and its components.  SFAS No. 131 establishes standards
for the way that public business enterprises report information about operating
segments and related information in interim and annual financial statements. 
SFAS No. 130 and 131 are effective for periods beginning after December 15, 
1997.  These three statements will not have any effect on the Company's 1997 
financial statements, however, management is evaluating what, if any, 
additional disclosure may be required when these statements are implemented.


Restatement:

In August 1997, the Company's subsidiary, American Rice, Inc. ("ARI"), 
reached an agreement with Aqaba Packaging Company ("APC") whereby APC 
purchases and processes rice shipped in bulk to APC's facility
at Aqaba, Jordan.  The Company has experienced continued problems
with the implementation of the provisions of this agreement.  These problems
include APC's inability to meet its contractual commtiments to purchase
sufficient rice from ARI to maintain adequate inventory levels in Jordan.
 


<PAGE>
<PAGE> 8


Restatement (continued):

ARI is currently negotiating with APC for alternative arrangements for 
this facility so that adequate inventory levels may be maintained.  As 
a result of these events, ARI has concluded that the facts supporting the
original sales to APC have changed to such an extent as to warrant
reversing the sales in the second quarter.  Accordingly, ARI has reversed 
the sales and recorded the rice in the APC facility as inventory.  The 
following table analyzes the impact of this event (in thousands of 
dollars, except per share data):

                           Three Months Ended             Six Months Ended      
                           September 30, 1997            September 30, 1997
                          -----------------------       ----------------------
                          Previously        As          Previously      As
                           Reported      Restated        Reported    Restated
                          ----------     --------       ----------   ---------

 Net sales                 $116,302       $96,430        $246,813     $226,941
 Gross profit                19,387        15,836          34,694       31,143
 Net loss                    (1,021)       (3,099)         (5,714)      (7,792)
 Loss per common 
  Share:
   Primary                   (0.20)        (0.61)          (1.16)       (1.58)
   Fully Diluted             (0.20)        (0.61)          (1.16)       (1.58)



                            At September 30, 1997
                           -----------------------
                            Previously        As   
                            Reported       Restated 
                            ----------     -------- 

 Accounts receivable, net   $82,509        $62,637
 Inventories                122,396        137,880
 Total assets               311,708        307,320
 Current liabilities        172,353        171,516
 Stockholders' equity        20,453         18,375





Note 1 - Minority Interest

In May 1993, substantially all of the assets and liabilities of ERLY's wholly
owned subsidiary, Comet Rice, Inc. ("Comet"), were acquired by American Rice,
Inc. ("ARI"), in a transaction accounted for as a reverse acquisition by its
subsidiary, Comet.  Prior to the transaction, ERLY owned 48% of the voting 
rights of ARI, and its investment in ARI was accounted for using the equity 
method.  As a result of the transaction, ERLY's ownership increased to 81% 
of the voting rights of ARI.

<PAGE>
<PAGE> 9


ERLY's 81% voting interest in ARI consists of the following securities of ARI:

  * 777,777 shares of ARI common stock which represent 32% of ARI's total
    outstanding common stock and 9% of ARI's common shares on a fully
    converted basis.

  * 777,777 shares of ARI Series A Preferred Stock, which is convertible one
    for one, has voting rights, liquidation preferences of $25.70 per share,
    but has no stated dividend.  These shares represent 9% of ARI's common
    shares on a fully converted basis.

  * 2,800,000 shares of ARI Series B Preferred Stock, which is convertible
    into 5,600,000 common shares, has voting rights, liquidation preferences
    of $5.00 per share and an annual cumulative dividend of approximately
    $5.2 million.  These shares represent 63% of ARI's common shares on a
    fully converted basis.

ARI also issued a Series C Preferred Stock to third parties which does not have
voting or conversion rights but does have an annual cumulative dividend of
$750,000.  The Series A, Series B and Series C Preferred Stocks are unique
securities with preferential rights which are superior to common stock rights.

The Minority Interest of ARI in ERLY's consolidated financial statements
represents the 68% of the common stock of ARI which ERLY does not own and the
Series C Preferred Stock, for a total of 19% of the voting interest in ARI on a
fully converted basis.


ARI's earnings or losses are allocated between ERLY and the Minority Interest 
in accordance with the underlying terms of the various securities, rather 
than allocation based on voting ownership of the subsidiary.  No conversion 
is assumed in the case of convertible preferred stocks for purposes of this 
calculation, even though conversion may occur at any time at the option of 
ERLY.

ARI's cumulative annual dividends of $5.2 million related to the Series B
Preferred Stock and $750,000 related to the Series C Preferred Stock are 
deducted from ARI earnings or loss to yield earnings or loss to be allocated 
to common stock.  The Series B Preferred Stock dividend is allocated entirely 
to ERLY, while the Series C Preferred Stock dividend is allocated entirely 
to Minority Interest.  The current ARI loan agreements prohibit the payment 
of any dividends.  These dividends are allocated even if not declared as the 
dividends are cumulative.  The remaining earnings or losses to be allocated 
to common stock after deduction of the preferred stock dividends is allocated 
in accordance with the relative common stock ownership of ERLY (32%) and the 
Minority Interest (68%).  ERLY's share of ARI's net earnings (loss) applicable
to common stock after preferred dividend requirements was ($1,723,000) and 
($2,769,000) for the three and six months ended September 30, 1997 and 1996, 
respectively.  ERLY also earned Series B preferred dividends of $1,295,000 
for each of the three month periods ended September 30, 1997 and 1996, and 
$2,590,000 for each of the six month periods ended September 30, 1997 and 
1996.  As of September 30, 1997, ARI Series B Preferred Stock dividends 
accumulated, but not declared, total $22.4 million.

<PAGE>
<PAGE> 10

 
Note 2 - Olive Business Acquisition

On July 5, 1996, the Company's subsidiary, ARI, acquired the domestic and 
foreign olive business of Campbell Soup Company ("CSC Olives") for 
approximately $36 million (the "Acquisition").  Assets acquired include 
domestic inventories and fixed assets, all of the outstanding common stock 
of a Spanish company that comprises the foreign olive business, and 51% of 
the stock of Sadrym California, a marketer of olive processing machinery.  
The purchase was funded primarily from ARI's credit facilities.  The 
Acquisition was accounted for as a purchase and the results of operations of 
the acquired business have been included in the Company's consolidated 
financial statements after July 5, 1996.  The olive business is operated as 
the Early California Foods division of ARI.

Operating results reflected in the accompanying financial statements do not
include CSC Olives' operating activities before July 5, 1996.  The following
summarized unaudited pro forma information assumes the Acquisition occurred 
on the first day of the prior fiscal year (in thousands, except per 
share data):

                               Three months ended      Six months ended
                               September 30, 1996     September 30, 1996
                               ------------------     ------------------
Net sales                         $ 156,767              $ 299,580  

Net income                        $   4,737              $   1,688

Earnings per share:
  Primary                         $     .94              $     .32
  Fully diluted                   $     .89              $     .31


Note 3 - Notes Payable 

ARI has an $85 million revolving credit loan with interest at the prime 
rate.  The loan provides financing for ARI's rice and olive operations.  
At September 30, 1997, the outstanding balance on this loan was $69.1 
million.  In December 1997, ARI received a 90 day $10 million increase 
to the line of credit from its banks.  This loan facility contains 
restrictive covenants which, among other things, require the attainment 
of certain financial ratios and provide limitations on capital expenditures, 
lease obligations, and prohibit dividend payments.  As of September 30, 1997, 
ARI was not in compliance with certain of the covenants related to interest 
coverage, adjusted funded debt and adjusted tangible net worth.  Subsequently,
ARI obtained waivers from compliance with these covenants from its banks 
covering the period up to and including December 30, 1997 and amendments 
effective December 31, 1997.  As of December 31, 1997, ARI was not in 
compliance with the amended covenants related to interest coverage, adjusted 
funded debt and adjusted tangible net worth.  ARI has requested waivers from 
compliance with these amended covenants.  The line also contains certain 
cross default provisions with the indenture for ARI's 13% mortgage notes 
due 2002.

Chemonics Industries, Inc. has lines of credit totaling $20 million which 
provide financing for both Consulting and Fire-Trol.


<PAGE>
<PAGE> 11


Certain of the Company's and subsidiaries' long-term debt agreements require
maintenance of minimum amounts or ratios related to working capital, long-term
debt and net worth, in addition to the observance of other covenants.  These
restrictions also preclude the payment of cash dividends. 


Note 4 - Commitments and Contingencies

In July 1997, The Powell Group, a diversified holding company based in Baton
Rouge, Louisiana, through its wholly owned subsidiary, Farmers Rice Milling 
Company, a Louisiana corporation, filed a shareholder derivative complaint 
purportedly on behalf of ERLY and ARI, against Gerald D. Murphy, Douglas A. 
Murphy, the Company and ARI in the U.S. District Court, Central District of 
California.  On November 3, 1997, the Court dismissed the complaint without 
prejudice.  


In April 1995, a lawsuit was filed in the District Court of Harris County, 
Texas, by Kingwood Lakes South, L.P. and Tenzer Company, Inc., as plaintiffs, 
against G.D. Murphy and D.A. Murphy, Chairman and President of the Company 
and ARI, respectively.  ERLY and ARI were named as codefendants in the 
lawsuit by an amendment to the original petition in September 1995.  This  
lawsuit arises from a dispute between the general partner of a proposed real 
estate development and G.D. Murphy and D.A. Murphy, over their contractual 
obligations, if any, to the partnership.  The Company and ARI were named as 
codefendants in the lawsuit allegedly because of their efforts to first obtain
restraining orders to prevent threatened foreclosures on ERLY common stock 
pledged as collateral by G.D. Murphy, which threatened ARI's mortgage note 
financing.  The lawsuit also alleges certain other activities by ERLY and ARI,
including knowing participation in breaches of fiduciary duties, fraud and
civil conspiracy with the Murphys.  A restraining order was issued preventing 
foreclosure on the shares pledged by G.D. Murphy but such restraining order
was subsequently terminated.  The plantiffs then obtained 333,333 shares
of the pledged stock which was thereafter sold.  In order to minimize legal 
expenses, ERLY, ARI and D.A. Murphy are utilizing common legal counsel 
in this matter.  Gerald D. Murphy retained separate legal counsel in 
February 1997.  He has agreed to pay up to 50% of legal expenses after 
any insurance recoveries as determined by the members of the board of 
directors not a party to the lawsuit.  On September 9, 1997 the jury in this 
litigation returned two alternative verdicts in favor of the plaintiffs and 
the plaintiffs were required to elect between those verdicts.  The plaintiffs 
elected the jury's tort claim verdict in the aggregate amount of $9,657,000 
rendered jointly and severally against Gerald D. Murphy, Douglas A. Murphy, 
ERLY and ARI, along with separate awards of punitive damages against 
Gerald D. Murphy of $3,000,000, Douglas A. Murphy of $500,000, ERLY of 
$100,000, and ARI of $100,000.  The defendants subsequently filed motions 
before the trial court for judgment in defendants' favor notwithstanding the 
verdict and for a reduction of the amounts awarded by the jury based, in 
part, on the absence of evidence to support those awards.  On January 13, 
1998 a final judgment was rendered in which the tort claim verdict was 
reduced to $5.3 million plus prejudgment interest of $1.0 million.  The 
punitive damages against all defendants remained unchanged in the final 
judgment.  The Company filed a motion for a new trial on February 12, 1998.  


<PAGE>
<PAGE> 12

If a new trial is not granted, the Company and ARI intend to appeal this 
judgment and believe they will be successful on appeal, however, there
can be no assurance that the Company will be successful in its appeal.  
At this time, the Company does not have resources to post a bond and 
there is no assurance that they will do so.  The Company is attempting 
to arrange for the posting of a bond in order to avoid execution of 
this judgment pending appeal.  These efforts include discussions with
its insurors and other actions such as the sale of assets.  Without 
posting a bond or otherwise superceding the judgment by mid-April, 
the Company would be at risk for execution of the judgment against it.  
If the bond can not be posted or if the judgment can not be paid, 
the outcome of this litigation will have a material adverse impact 
on its and ARI's financial condition.



ARI was named as a codefendant with Messrs. John M. Howland and 
George E. Prchal in a lawsuit filed in February 1997 in the U.S. District 
Court for the Southern District of Texas by Rice Milling & Trading 
Investments, LTD., an Isle of Man Company ("RMTI").  In 1994, ARI entered 
into an agreement with RMTI for processing the Company's rice through 
RMTI's facility in Jeddah, Saudi Arabia.  Messrs. Howland and Prchal were 
officers of RMTI through January 1997, and prior to October 1993 they were 
officers of ARI.  Messrs. Howland and Prchal were directors of ARI from 
October 1993 through October 1997.  In January 1997, RMTI ceased shipping 
ARI's rice through its Jeddah facility and terminated the employment of 
Messrs. Howland and Prchal.  The lawsuit alleges among other things ARI 
failed to perform under the terms of the agreement and Messrs. Howland and 
Prchal breached their fiduciary duties to RMTI.  In April 1997, ARI obtained 
a preliminary injunction from the U.S. District Court for the Southern 
District of Texas ordering RMTI to desist and refrain from purchasing rice 
of U.S. or Vietnam origin from any supplier other than ARI and from 
introducing and/or marketing rice of U.S. and Vietnam origin in Saudi 
Arabia targeted against ARI's U.S. origin and Vietnam origin rice.  In 
October 1997, ARI voluntarily terminated this injunction.  RMTI has added 
claims of fraud, participation in breach of duty, and tortuous interference 
against ARI.  The date for the trial is set for December 1, 1998.

ARI's 13% mortgage notes, with an outstanding principal balance at 
September 30, 1997 of $99 million, provide for semi-annual interest 
payments on February 28 and August 31.  ARI is considering a number of 
alternatives for paying the fixed interest due on the mortgage notes on 
February 28, 1998 but due to the current impairment of the liquidity of 
ARI and pending resolution of the Companys' ability to satisfy or appeal 
the final judgment in the Kingwood Lakes South litigation the Company 
will not be able to make such payment by the due date.  The Company 
anticipates that such payment will be made before the end of the 30 day 
grace period, however, no assurances can be given that such interest 
payment can be made by the end of the grace period.


Note 5 - Stockholders' Equity

In October 1997, the Company declared a 10% stock dividend to shareholders of
record at the close of business on October 31, 1997. 

<PAGE>
<PAGE> 13




Item 2.           ERLY INDUSTRIES INC. AND SUBSIDIARIES 
                 MANAGEMENT'S DISCUSSION AND ANALYSIS OF 
              FINANCIAL CONDITION AND RESULTS OF OPERATIONS
    FOR THE THREE AND SIX MONTHS ENDED SEPTEMBER 30, 1997 AND 1996




RESTATEMENT

In August 1997, ARI reached an agreement with Aqaba Packaging Company ("APC")
whereby APC purchases and processes rice shipped in bulk to APC's facility
at Aqaba, Jordan.  The Company has experienced continued problems with 
the implementation of the provisions of this agreement.  These problems
include APC's inability to meet its contractual commtiments to purchase
sufficient rice from ARI to maintain adequate inventory levels in Jordan.
ARI is currently negotiating with APC for alternative arrangements for 
this facility so that adequate inventory levels may be maintained.  As a 
result of these events, ARI has concluded that the facts supporting the
original sales to APC have changed to such an extent as to warrant reversing
the sales in the second quarter.  Accordingly, ARI has reversed the 
sales and recorded the rice in the APC facility as inventory.  
Adjustments are detailed in the "Restatement" section of Notes to 
Consolidated Financial Statements.  The following discussion and analysis 
reflects all such adjustments.




RESULTS OF OPERATIONS - THREE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996


Consolidated Results

For the quarter ended September 30, 1997, the Company reported a net loss of 
$3.1 million on sales of $96.4 million, as compared to net income of $4.8 
million on sales of $156 million for the second quarter of the prior fiscal 
year.  Sales for the second quarter of fiscal 1998 reflect a $48.2 million 
decrease in sales by American Rice from the second quarter of last year, plus
a $9.0 million decrease in sales by Chemonics Fire-Trol, and a $2.4 million 
decrease in revenues by Chemonics International. 

Gross profit for the quarter ended September 30, 1997 was $15.8 million, a
decrease of $8.5 million from the quarter ended September 30, 1996 as a result
of decreases by Chemonics Fire-Trol of $3.2 million and American Rice of $6.0
million, partially offset by an increase by Chemonics International of 
$722,000.

<PAGE>
<PAGE> 14

American Rice 

Sales for the quarter ended September 30, 1997 decreased $48.2 million, or 40%,
from $121.5 million in fiscal 1997 to $73.3 million in fiscal 1998.  The sales
decrease for the quarter reflects a $53.2 million decline in export sales and a
$3.1 million decrease in U.S. rice sales, partially offset by an $8.1 million
increase in sales by the olive business acquired in July 1996.  Export sales 
declines were experienced primarily in four Middle East markets and Africa.

Gross profit was 12.5% of sales for the quarter ended September 30, 1997 
and 12.5% last year.  Gross profit decreased $6.1 million, or 40%, 
from $15.2 million in the second quarter last year to $9.1 million in the 
second quarter of this year, due primarily to lower sales for the quarter.

ARI's selling, general and administrative expenses of $9.4 million increased
$988,000 or 12%, from $8.4 million last year.  The increase is due primarily 
to higher advertising and promotional expenses.  Selling, general and 
administrative expenses as a percentage of net sales were 12.9% in the 
second quarter of the current year compared to 7.0% last year.  


Chemonics International - Consulting 

For the quarter ended September 30, 1997, revenues for International were $18.8
million, a decrease of $2.4 million, or 11%, from revenues of $21.1 million for
the comparable period last year.  The decrease in revenues from last year is
primarily attributed to the wind down of some projects in the current year, 
with new and follow-on projects not yet completely started.  Gross profit was 
$5.8 million (31% of revenues) for the quarter compared to gross profit of 
$5.1 million (24% of revenues) for the second quarter of last year.  This 
increase reflects a reduced level of subcontracted work and a greater
utilization of Chemonics' staff as a percentage of the cost input.

Chemonics Industries - Fire-Trol
     
Fire-Trol reported sales of $4.3 million for the quarter compared to sales of
$13.3 million reported last year, a decrease of $9.0 million or 68%.  Due to a
very slow forest fire season this year, Fire-Trol's sales were the lowest in 
the last 10 years.  The current year follows last year's near record level of 
forest fire activity, which therefore results in a significant swing when 
comparing to last year's results.  Gross profit for the quarter was $881,000, 
down from $4.1 million last year due to the significantly lower sales.  

Corporate 

Consolidated interest expense totaled $7.2 million for the quarter ended
September 30, 1997, compared to $6.1 million for the same quarter of last year.
This increase reflects increased average borrowings from a year ago due to the
acquisition of the olive business in July 1996.  Interest expense in both 
periods includes amortization of capitalized debt issuance costs.


<PAGE>
<PAGE> 15


RESULTS OF OPERATIONS - SIX MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
                                
Consolidated Results

For the six months ended September 30, 1997, the Company reported a net loss of
$7.8 million on sales of $227 million, as compared to net income of $3.5 
million on sales of $281 million for the first six months of the prior fiscal 
year.  Sales for the current year were down $54 million from last year, 
primarily due to a $13.3 million decrease by Chemonics Fire-Trol, a $32.2 
million decrease in sales by American Rice and an $8.3 million decrease by 
Chemonics International.

Gross profit for the six months ended September 30, 1997 was $31.1 million
compared to $37.7 million for the comparable period of last year.

American Rice

Sales for the six months ended September 30, 1997 decreased $32.2 million, or
14.7%, from $218.9 million in fiscal 1997 to $186.7 million in fiscal 1998.  The
decrease in sales was composed of a $52.5 million decline in export sales and a
$4.0 million decrease in U.S. rice sales, partially offset by a $24.3 million
increase in sales by the olive business acquired in July 1996.  Export sales
declines were experienced primarily in Middle East markets and Africa.


Gross profit was 11% of sales for the six month period ended September 30, 
1997, compared to 9.9% in fiscal 1997.  Gross profit decreased $1.1 million, 
or 5%, from $21.7 million in the first six months of last year to $20.6 
million in the first six months of this year, due primarily to the Early 
California Foods acquisition.  

ARI's selling, general and administrative expenses of $18.3 million increased
$3.4 million, or 23%, from $14.9 million last year.  The increase is primarily
due to higher advertising and promotional expenses associated with the olive
business acquired in July 1996.  Selling, general and administrative expenses
as a percentage of net sales increased from 6.8% in the first six months
of last year to 9.8% this year.

Chemonics International - Consulting

For the six months ended September 30, 1997, revenues for International were
$34.1 million, a decrease of $8.3 million, or 20%, from revenues of $42.4 
million for the comparable period last year.  The decrease in revenues
from last year is primarily attributed to the wind down of some projects
in the current year, with new and follow-on projects not yet completely
started.  Gross profit was $9.7 million (29% of revenues) for the period 
compared to gross profit of $10.3 million (24% of revenues) for the 
comparable period last year.


<PAGE>
<PAGE> 16

Chemonics Industries - Fire-Trol

Fire-Trol reported net sales of only $5.9 million for the six months ended
September 30, 1997, compared to sales of $19.2 million reported last year, a
decrease of $13.3 million, or 69%.  The current year experienced an extremely 
low level of forest fire activity resulting in the lowest sales in the past 
10 years for Fire-Trol.  Due to the significantly lower sales, gross profit 
for the six months was only $598,000 or 10% of sales, compared to $5.6 
million, or 29% of sales last year.

Corporate

Consolidated interest expense totaled $13.8 million for the six months ended
September 30, 1997, compared to $11.3 million for the same period of last year.
This increase reflects increased average borrowings due to the acquisition of 
the olive business in July 1996.  Interest expense in both periods includes
amortization of capitalized debt issuance costs.



Liquidity And Capital Resources

At September 30, 1997, consolidated working capital was $38.4 million, 
compared to $45.9 million at March 31, 1997, a decrease of $7.5 million.  
Stockholders' equity was $18.4 million at September 30, 1997, compared to 
$24.8 million at March 31, 1997, a decrease of $6.4 million, primarily as 
a result of the net loss for the six months.

For the six months ended September 30, 1997, cash used in operations was $2.7
million, primarily related to the loss for the period.  Expenditures for 
capital equipment were $4.6 million for the period.  Financing activities 
provided a $6.3 million increase in cash for the period, primarily through 
an $8.9 million capitalized lease relating to the sale and leaseback 
transaction discussed below, partially offset by a $2.7 million decrease 
in borrowings under the Company's lines of credit.

ARI has an $85 million revolving credit loan with interest at the prime 
rate.  The loan provides financing for ARI's rice and olive operations.  
At September 30, 1997, the outstanding balance on this loan was $69.1 
million.  In December 1997, ARI received a 90 day $10 million increase 
to the line of credit from its banks.  This loan facility contains 
restrictive covenants which, among other things, require the attainment 
of certain financial ratios and provide limitations on capital expenditures, 
lease obligations, and prohibit dividend payments.  As of September 30, 1997, 
ARI was not in compliance with certain of the covenants related to interest 
coverage, adjusted funded debt and adjusted tangible net worth.  Subsequently,
ARI obtained waivers from compliance with these covenants from its banks 
covering the period up to and including December 30, 1997 and amendments 
effective December 31, 1997.  As of December 31, 1997, ARI was not in 
compliance with the amended covenants related to interest coverage, adjusted 
funded debt and adjusted tangible net worth.  ARI has requested waivers from 
compliance with these amended covenants.  The line also contains certain 
cross default provisions with the indenture for ARI's 13% mortgage notes 
due 2002.

Chemonics Industries, Inc. has lines of credit totaling $20 million which 
provide financing for both Consulting and Fire-Trol.

<PAGE>
<PAGE> 17

In July 1997, ARI completed a sale and leaseback transaction for substantially
all of its olive processing machinery and equipment located in Visalia,
California.  ARI realized proceeds from the sale of approximately $8.9 million
which were used for operating purposes.  These assets were leased for a seven
year term with a two year extension option.  The transaction is being accounted
for as a capital lease with the proceeds recorded as a liability that is 
reduced by lease payments over the lease term.  

In August 1997, ARI reached an agreement with Aqaba Packaging Company ("APC")
whereby APC purchases and processes rice shipped in bulk to APC's facility 
at Aqaba, Jordan.  ARI has experienced continued problems with the
implementation of the provisions of this agreement.  These problems include
APC's inability to meet its contractual commitments to purchase sufficient
rice from ARI to maintain adequate inventory levels in Jordan.  ARI is 
currently negotiating with APC for alternative arrangements for this 
facility so that adequate inventory levels may be maintained.

Beginning in the quarter ended June 30, 1997, the liquidity of ARI has been
significantly impaired, in part, as a result of the loss of financing 
associated with the RMTI agreement (see Part II - Legal Proceedings).  
Without the RMTI agreement, the general corporate financing required for 
ARI's sales and marketing in Saudi Arabia is significantly greater.  ARI 
has had to utilize its credit lines to maintain the inventory position 
for its Saudi Arabia sales and has thus reduced the availability for its 
domestic activities.  In addition to increasing the use of ARI's credit 
lines, ARI has also experienced an increase in its accounts payable.  
Management believes that its rice raw material costs have increased to 
the extent the impairment of liquidity has precluded it from bidding on 
a competitive basis.  In addition to the sale and leaseback transaction 
and the APC agreement discussed above, management is exploring several 
other opportunities to improve liquidity.  However, no assurances can be 
given that the Company can conclude the other arrangements being considered. 

ARI's 13% mortgage notes, with an outstanding principal balance at 
September 30, 1997 of $99 million, provide for semi-annual interest 
payments on February 28 and August 31.  ARI is considering a number of 
alternatives for paying the fixed interest due on the mortgage notes on 
February 28, 1998 but due to the current impairment of the liquidity of 
ARI and pending resolution of the Companys' ability to satisfy or appeal 
the final judgment in the Kingwood Lakes South litigation (see Legal 
Proceedings) the Company will not be able to make such payment
by the due date.  The Company anticipates that such payment will be
made before the end of the 30 day grace period, however, no assurances 
can be given that such interest payment can be made by the end of the 
grace period.

<PAGE>
<PAGE> 18                             


                             PART II
                       OTHER INFORMATION
                                

Item 1.  Legal Proceedings

In July 1997, The Powell Group, a diversified holding company based in Baton
Rouge, Louisiana, through its wholly owned subsidiary, Farmers Rice Milling 
Company, a Louisiana corporation, filed a shareholder derivative complaint 
purportedly on behalf of ERLY and ARI, against Gerald D. Murphy, Douglas A. 
Murphy, the Company and ARI in the U.S. District Court, Central District of 
California.  On November 3, 1997, the Court dismissed the complaint without 
prejudice.  

In April 1995, a lawsuit was filed in the District Court of Harris County, 
Texas, by Kingwood Lakes South, L.P. and Tenzer Company, Inc., as plaintiffs, 
against G.D. Murphy and D.A. Murphy, Chairman and President of the Company 
and ARI, respectively.  ERLY and ARI were named as codefendants in the 
lawsuit by an amendment to the original petition in September 1995.  This  
lawsuit arises from a dispute between the general partner of a proposed real 
estate development and G.D. Murphy and D.A. Murphy, over their contractual 
obligations, if any, to the partnership.  The Company and ARI were named as 
codefendants in the lawsuit allegedly because of their efforts to first obtain
restraining orders to prevent threatened foreclosures on ERLY common stock 
pledged as collateral by G.D. Murphy, which threatened ARI's mortgage note 
financing.  The lawsuit also alleges certain other activities by ERLY and ARI,
including knowing participation in breaches of fiduciary duties, fraud and
civil conspiracy with the Murphys.  A restraining order was issued preventing
foreclosure on the shares pledged by G.D. Murphy but such restraining
order was subsequently terminated.  The plaintiffs then obtained 333,333
shares of the pledged stock which was thereafter sold.  

In order to minimize legal expenses, ERLY, ARI and D.A. Murphy are utilizing 
common legal counsel in this matter.  Gerald D. Murphy retained separate legal
counsel in February 1997.  He has agreed to pay up to 50% of legal expenses 
after any insurance recoveries as determined by the members of the board of 
directors not a party to the lawsuit.  On September 9, 1997 the jury in this 
litigation returned two alternative verdicts in favor of the plaintiffs and 
the plaintiffs were required to elect between those verdicts.  The plaintiffs 
elected the jury's tort claim verdict in the aggregate amount of $9,657,000 
rendered jointly and severally against Gerald D. Murphy, Douglas A. Murphy, 
ERLY and ARI, along with separate awards of punitive damages against 
Gerald D. Murphy of $3,000,000, Douglas A. Murphy of $500,000, ERLY of 
$100,000, and ARI of $100,000.  The defendants subsequently filed motions 
before the trial court for judgment in defendants' favor notwithstanding 
the verdict and for a reduction of the amounts awarded by the jury based, 
in part, on the absence of evidence to support those awards.  On January 13, 
1998 a final judgment was rendered in which the tort claim verdict was 
reduced to $5.3 million plus prejudgment interest of $1.0 million.  The 
punitive damages against all defendants remained unchanged in the final 
judgment.  The Company filed a motion for a new trial on February 12, 1998.  



<PAGE>
<PAGE> 19                             


If a new trial is not granted, the Company and ARI intend to appeal this 
judgment and believe they will be successful on appeal, however, there
can be no assurance that the Company will be successful in its appeal.  
At this time, the Company does not have resources to post a bond 
and there is no assurance that they will do so.  The Company is attempting 
to arrange for the posting of a bond in order to avoid execution of this 
judgment pending appeal.  These efforts include discussions with its
insurors and other actions such as the sale of assets.  Without posting 
a bond or otherwise superceding the judgment by mid-April, the Company 
would be at risk for execution of the judgment against it.  If the bond 
can not be posted or if the judgment can not be paid, the outcome of this 
litigation will have a material adverse impact on its and ARI's financial 
condition.


ARI was named as a codefendant with Messrs. John M. Howland and 
George E. Prchal in a lawsuit filed in February 1997 in the U.S. District 
Court for the Southern District of Texas by Rice Milling & Trading 
Investments, LTD., an Isle of Man Company ("RMTI").  In 1994, ARI entered 
into an agreement with RMTI for processing the Company's rice through RMTI's 
facility in Jeddah, Saudi Arabia.  Messrs. Howland and Prchal were officers 
of RMTI through January 1997, and prior to October 1993 they were officers 
of ARI.  Messrs. Howland and Prchal were directors of ARI from October 1993 
through October 1997.  In January 1997, RMTI ceased shipping ARI's rice 
through its Jeddah facility and terminated the employment of Messrs. Howland 
and Prchal.  The lawsuit alleges among other things ARI failed to perform 
under the terms of the agreement and Messrs. Howland and Prchal breached 
their fiduciary duties to RMTI.  In April 1997, ARI obtained a preliminary 
injunction from the U.S. District Court for the Southern District of Texas 
ordering RMTI to desist and refrain from purchasing rice of U.S. or Vietnam 
origin from any supplier other than ARI and from introducing and/or marketing 
rice of U.S. and Vietnam origin in Saudi Arabia targeted against ARI's U.S. 
origin and Vietnam origin rice.  In October 1997, ARI voluntarily terminated 
this injunction.  RMTI has added claims of fraud, participation in breach of 
duty, and tortuous interference against ARI.  The date for the trial is set
for December 1, 1998.  

<PAGE>
<PAGE> 20

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

(a)  The Annual Meeting of Shareholders was held on October 17, 1997.


Item 6.  Exhibits and Reports on Form 8-K

(a) Exhibits

    11.1  Calculation of Primary Income Per Share

    11.2  Calculation of Fully Diluted Income Per Share

    27    Financial Data Schedule (electronic filing)                


(b) No reports on Form 8-K were filed during the quarter ended September 30,
    1997.


<PAGE>
<PAGE> 21


                            SIGNATURE

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

    
                                       ERLY INDUSTRIES INC.
                                          (Registrant)



Date:    February 18, 1998            By /s/ Thomas A. Whitlock 
                                         ----------------------
                                         Thomas A. Whitlock
                                         Vice President and
                                         Corporate Controller         





<PAGE>
<PAGE> 22


                                         EXHIBIT 11.1
                            ERLY INDUSTRIES INC. AND SUBSIDIARIES
                           CALCULATION OF PRIMARY INCOME PER SHARE
                            (In thousands, except per share data)


<TABLE>                      
<CAPTION>

                                            Three months ended                 Six months ended
                                               September 30,                     September 30,              
                                      -----------------------------      ----------------------------
                                         1997                1996          1997                1996  
                                      --------             --------      --------            --------
                                               (Unaudited)                        (Unaudited)

                                   (As Restated)                       (As Restated)
<S>                                  <C>                   <C>           <C>                 <C>
Income (loss) before
  minority interest                  ($ 6,573)              $ 4,606      ($13,302)            $   770 
Minority interest                       3,474                   157         5,510               2,743 
                                      -------               -------       -------             -------
  Net income (loss)                  ($ 3,099)              $ 4,763      ($ 7,792)            $ 3,513 
                                      =======               =======       =======             =======


Average number of shares of
  common stock and common
  stock equivalents outstanding:
   Average number of shares of
    common stock outstanding            5,088                 4,733         4,921               4,723 

   Common stock equivalents: 
    Dilutive effect of stock
     options and warrants based 
     on application of treasury
     stock method                         (a)                   308           (a)                 502 
                                        -----                 -----         -----               -----
    Total                               5,088                 5,041         4,921               5,225 
                                        =====                 =====         =====               =====

  Primary income (loss) per 
    common share                      ($  .61)               $  .94      ($  1.58)            $   .67 
                                       ======                ======       =======             =======

</TABLE>


<PAGE>
<PAGE> 23



                                         EXHIBIT 11.2
                            ERLY INDUSTRIES INC. AND SUBSIDIARIES
                        CALCULATION OF FULLY DILUTED INCOME PER SHARE
                            (In thousands, except per share data)


<TABLE>
<CAPTION>

                                            Three months ended               Six months ended
                                               September 30,                   September 30,    
                                      -----------------------------    ------------------------------
                                         1997                1996         1997                1996  
                                      --------            ---------    ----------           ---------
                                               (Unaudited)                      (Unaudited)
                                    
                                    (As Restated)                      (As Restated)
<S>                                   <C>                  <C>           <C>                 <C>
Income (loss) before
  minority interest                  ($ 6,573)             $  4,606     ($ 13,302)           $    770
Interest adjustment - convertible
  note payable                           (a)                     25          (a)                   51 
Income (loss) before minority         -------               -------       -------             -------
  interest, as adjusted              (  6,573)                4,631     (  13,302)                821 

Minority interest                       3,474                   157         5,510               2,743 
                                      -------               -------       -------             -------
  Net income (loss), as adjusted     ($ 3,099)              $ 4,788      ($ 7,792)            $ 3,564 
                                      =======               =======       =======             =======


Average number of shares of
  common stock and common 
  stock equivalents outstanding         5,088                 5,041         4,921               5,225 
Other potentially
  dilutive securities:
  Common stock issuable upon
    conversion of note payable            (a)                   337           (a)                 337 
                                        -----                 -----         -----               -----
      Total                             5,088                 5,378         4,921               5,562 
                                        =====                 =====         =====              ======
  Fully diluted income (loss)
    per common share                 ($   .61)              $   .89      ($  1.58)            $   .64 
                                      =======               =======       =======             =======



</TABLE>