MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                       CONDITION AND RESULTS OF OPERATIONS

Certain   matters   discussed  in  this  Annual  Report  to   Shareholders   are
"forward-looking  statements"  intended  to qualify  for the safe  harbors  from
liability  established by the Private Securities  Litigation Reform Act of 1995.
These forward-looking statements can generally be identified as such because the
context of the  statement  will  include  words such as the Company  "believes",
"anticipates", "expects", or words of similar import. Similarly, statements that
describe   the   Company's   future   plans,   objectives   or  goals  are  also
forward-looking  statements.  Such  forward-looking  statements  are  subject to
certain  risks and  uncertainties,  including,  but not  limited to, new product
advancements  by  competition,   significant  changes  in  industry  technology,
economic or  political  conditions  in the  countries  in which the Company does
business,  the continued availability of sources of supply, the availability and
consummation  of  favorable  acquisition  opportunities,  increasing  competitve
pressures on pricing and other contract terms,  economic  factors  affecting the
Company's  customer  base and stock price  variations  affecting  the  Company's
securities trading portfolio. These factors could cause actual results to differ
materially from those  anticipated as of the date of this report.  Shareholders,
potential  investors  and other  readers are urged to consider  these factors in
evaluating the  forward-looking  statements and are cautioned not to place undue
reliance on such  forward-looking  statements.  The  forward-looking  statements
included  herein  are only made as of the date of this  report  and the  Company
undertakes no obligation to publicly update such  forward-looking  statements to
reflect subsequent events or circumstances.

The year ended January 31, 1999  ("fiscal  1998") was the year for preparing for
the future.  Edison Control Corporation (the "Company")  completed its move into
its 95,000 square foot  manufacturing  faciltiy in Port  Washington,  Wisconsin,
increased sales and marketing  efforts in foreign  countires,  and implemented a
new enterprise  resource  planning  system ("ERP") that the Company  believes is
year 2000 compliant. Notwithstanding these expenditures, the Company was able to
increase net sales by 4.9% and net income by 8.8%. Capital  expenditures for the
year were $3,082,725; however, debt only increased by $718,259.

                              RESULTS OF OPERATIONS

Fiscal 1998 versus Fiscal 1997

Net  sales  for  fiscal  1998  increased  4.9%  to  $25,050,116   compared  with
$23,875,214  in the prior year.  Strong  domestic  sales at  Construction  Forms
("ConForms"),  the inclusion of sales from the Company's Malaysian operation and
increased  mortar-plaster  mixer sales into the Florida market accounted for the
increase.  The lower percentage increase this year compared to last year was due
to  decreases in sales volume at the  Company's  Ultra Tech and ConForms  Europe
divisions.  Fewer  sales to mining  industry  customers  and the  slowing of the
construction  economies in Europe  accounted  for the decrease at Ultra Tech and
ConForms Europe, respectively.

As a percentage of net sales,  gross profit margin decreased to 35.6% for fiscal
1998 as  compared  to 38.4% in the prior year.  The  decrease  was due mainly to
product mix  variations,  the increase of lower margin  foreign  sales and costs
associated with the move from Cedarburg to Port Washington. Selling, engineering
and administrative  expenses  represented 18.2% of net sales for fiscal 1998 and
fiscal 1997,  respectively.  Selling,  engineering and  administrative  expenses
increased  $209,984 in fiscal 1998 to $4,560,257  due to increased  personnel in
engineering,  increased  sales costs related to foreign sales,  moving costs and
training and other costs incurred in relation to the  implementation  of the new
ERP system.

Interest  expense  was  $955,818  and  $1,133,382  for  fiscal  1998  and  1997,
respectively.  The decrease resulted from a reduction of the average outstanding
debt from the previous year.  Assuming rates remain stable,  interest expense is
expected to decrease in fiscal 1999 as further debt reduction is anticipated.

                                       4
<PAGE>


Net  investment  loss,  which  includes  interest,  dividends  and  realized and
unrealized gains or losses on trading  securities,  was $152,947 for fiscal 1998
compared to last year's net loss of  $173,366.  A major  reason for the net loss
was the  decrease  in the market  value of the  Company's  holdings  in Glenayre
Technologies, Inc. and VIVUS Inc. Although the Company has no established formal
investment  policies or  practices  for its trading  securities  portfolio,  the
Company generally pursues an aggressive trading strategy,  focusing primarily on
generating  near-term capital appreciation from its investments in common equity
securities. Securities held in the Company's portfolio at the end of each period
are  reported  at fair  value,  with  unrealized  gains and losses  included  in
earnings for that period. These factors,  combined with the relative size of the
Company's  trading  portfolio,  has led,  and will likely  continue to lead,  to
significant  period-to-period  earnings  volatility  depending  upon the capital
appreciation or depreciation of the Company's trading securities portfolio as of
the end of each  reporting  period.  The Company does not use or buy  derivative
securities. See "Quantitative and Qualitative Disclosures about Market Risk".

The amortization of goodwill,  financing costs, stock options and stock warrants
created a total  non-cash  charge of  $1,301,863  for fiscal  1998  compared  to
$1,600,421  for the  prior  year.  Goodwill  from the June 1996  acquisition  of
ConForms is being amortized over a 40-year period. The stock option amortization
was fully amortized as of June 21, 1997. The amortization of financing costs and
stock warrants will continue  principally  until June 21, 1999.  Excluding these
items, the Company would have reported net income of  approximately  $1,983,000,
or $.69 per diluted share. The total  amortization of all these non-cash charges
for the year ended January 31, 2000 is expected to approximate $660,000.

The Company recorded tax expense of $850,000 for fiscal 1998, which  represented
the  estimated  annual  effective  rate of 41.4% applied to pre-tax book income.
Deferred  income  taxes  reflect  the net tax effects of  temporary  differences
between the carrying amount of assets and  liabilities  for financial  statement
reporting purposes and the amounts used for income tax purposes.

Net  income  of  $1,202,330,  or $.52 and $.42 per  share,  basic  and  diluted,
respectively, for fiscal 1998 represented an increase of $97,168 from net income
of $1,105,162, or $.49 and $.41 per share, basic and diluted,  respectively, for
the prior fiscal year.

Fiscal 1997 versus Fiscal 1996

Net  sales  for  fiscal  1997  increased  75.5%  to  $23,875,214  compared  with
$13,604,340  in the prior year.  The  increase  was mainly  attributable  to the
inclusion of the results of operations of ConForms and subsidiaries for the full
year in fiscal 1997. On a pro-forma basis,  ConForms and subsidiaries' net sales
for fiscal 1997 increased  $2,653,879  (12.5%)  compared to fiscal 1996.  Strong
domestic  sales at  ConForms  and large  project  sales to power  and  phosphate
industry customers at Ultra Tech accounted for the increase.

Gross profit  margin  increased to 38.4% for fiscal 1997 as compared to 32.4% in
the prior  year.  The  increase  was due to better  pricing on Ultra Tech sales,
better fixed cost coverage from the increased volume at ConForms and Ultra Tech,
the inclusion of the acquired companies for the full period, and the sale of the
Company's electronic fault indicator business in late 1996.

Selling,  engineering and administrative expenses represented 18.2% and 23.8% of
net sales for fiscal 1997 and 1996,  respectively.  The percentage  decrease for
fiscal  1997 was  primarily  attributable  to the  inclusion  of the  results of
operations  of the acquired  companies  and  decreases in general  insurance and
ConForms' sales and marketing expenses. Selling,  engineering and administrative
expenses of the acquired  companies on a pro-forma basis decreased to $3,815,658
in fiscal 1997 from  $4,462,498 in fiscal 1996. This was mainly due to decreased
personnel  wages  and  benefits,  general  insurance  and  ConForms'  sales  and
marketing expense.

                                       5
<PAGE>

Interest  expense  was  $1,133,382  and  $775,762  for  fiscal  1997  and  1996,
respectively. Debt was incurred to finance the acquisition on June 21, 1996. The
increase in interest expense was due to a full year of outstanding debt.

Net  investment  loss,  which  includes  interest,  dividends  and  realized and
unrealized gains or losses on trading  securities,  was $173,366 for fiscal 1997
compared to last year's net gain of $33,279. A major reason for the decrease was
related  to the  decrease  in the  market  value of the  Company's  holdings  in
Glenayre Technologies, Inc. and VIVUS Inc.

The amortization of goodwill,  financing costs, stock options and stock warrants
created a total  non-cash  charge of  $1,600,421  for fiscal  1997  compared  to
$1,235,253  for the prior year.  Excluding  these items,  the Company would have
reported net income of approximately $2,065,000 or $.77 per diluted share.

The Company recorded tax expense of $850,000 for fiscal 1997, which  represented
the  estimated  annual  effective  rate of 43.5% applied to pre-tax book income.
Deferred  income  taxes  reflect  the net tax effects of  temporary  differences
between the carrying amount of assets and  liabilities  for financial  statement
reporting purposes and the amounts used for income tax purposes.

Net  income  of  $1,105,162,  or $.49 and $.41 per  share,  basic  and  diluted,
respectively,  for fiscal 1997  represented an increase of $1,836,190 from a net
loss of $731,028, or $.33 per share, basic and diluted, for the prior year. This
change  was   principally   due  to  the  operating   results  of  ConForms  and
subsidiaries.

           QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company is exposed to interest rate risk,  foreign  currency risk and equity
price risk.  These  risks  include  changes in U.S  interest  rates,  changes in
foreign currency  exchange rates as measured against the U.S. dollar and changes
in the prices of stocks traded on the U.S. markets.

Interest Rate Risk

The Company's  revolving credit  borrowings and variable rate term loans,  which
total  $14,741,601  as of January 31, 1999,  are subject to interest  rate risk.
Most of the  borrowings  float at either  the prime rate or LIBOR plus a certain
amount of basis points.  Based on the fiscal 1998 year end balance,  an increase
of one  percent in the  interest  rate on the  Company's  loans  would  cause an
increase  in interest  expense of  approximately  $147,000,  or $.03 per diluted
share, on an annual basis. The Company currently does not use derivatives to fix
variable rate interst obligations.

Foreign Currency Risk

The Company has foreign operations in the United Kingdom and Malaysia. Sales and
purchases are typically  denominated  in the British pound,  Malaysian  ringgit,
German mark,  Singapore  dollar or U.S. dollar,  thereby  creating  exposures to
changes in  exchange  rates.  The changes in exchange  rates may  positively  or
negatively affect the Company's sales, gross margins and retained earnings.  The
Company does not enter into foreign exchange  contracts but attempts to minimize
currency  exposure  risk through  working  capital  management.  There can be no
assurance that such an approach will be successful, especially in the event of a
significant and sudden decline in the value of a currency.

Equity Price Risk

Approximately  11% of the  Company's  total  assets as of January  31,  1999 are
invested in trading securities of various domestic  companies.  The market value
of these investments is subject to fluctuation.  This factor,  combined with the
relative  size of the Company's  trading  portfolio  ($3,616,314  at January 31,
1999), has led and will likely continue to lead, to significant period-to-period
earnings volatility  depending upon the capital 


                                        6
<PAGE>


appreciation or depreciation of the Company's trading  securities  portfolio.  A
10%  decrease  in the quoted  market  price of these  trading  securities  would
decrease the fair market value of these securities by approximately $360,000, or
$0.07  per  diluted  share.  Although  the  Company  has no  established  formal
investment  policies or  practices  for its trading  securities  portfolio,  the
Company generally pursues an aggressive trading strategy,  focusing primarily on
generating  near-term capital appreciation from its investments in common equity
securities. Securities held in the Company's portfolio at the end of each period
are  reported  at fair  value,  with  unrealized  gains and losses  included  in
earnings for that period. These factors,  combined with the relative size of the
Company's  trading  portfolio,  has led,  and will likely  continue to lead,  to
significant  period-to-period  earnings  volatility  depending  upon the capital
appreciation or depreciation of the Company's trading securities portfolio as of
the end of each  reporting  period.  The Company does not use or buy  derivative
securities.

                         LIQUIDITY AND CAPITAL RESOURCES

Cash flow from operating  activities was $1,480,894 for fiscal 1998, compared to
$3,671,674 for fiscal 1997. In fiscal 1997,  the net sale of trading  securities
accounted for approximately  $837,000 of the operating cash flow.  Excluding the
net trading  securities  activity  from  operating  cash flow,  the  significant
decrease in  operating  cash flow was due to the  increase in  purchases  of raw
materials in the last few months of fiscal 1998 compared to the same period last
year.

Net working capital of $12,730,093 at January 31, 1999 increased $1,856,761,  or
17.1%, from the fiscal 1997 year-end level of $10,873,332.  The current ratio at
January 31, 1999 was 3.8:1 compared to 3.5:1 at prior  year-end.  The change was
mainly due to the increase in inventories and in assets held for sale.

Cash used in investing  activities  for fiscal 1998 was  $2,962,272  compared to
$470,364 in fiscal 1997.  This increase was  principally  due to the  $2,527,802
increase in capital  expenditures for the year.  During fiscal 1998, the Company
constructed an addition to its Port  Washington  facility and  implemented a new
enterprise resource planning system.

Due to the capital  expenditures,  the Company increased its debt by $718,259 in
fiscal  1998,  which  accounted  for most of the cash  provided  from  financing
activities.  Cash used in financing  activities in fiscal 1997 of $2,884,082 was
due to repayment of debt.  The Company has reduced its debt by $4,852,759  since
the June 21, 1996 acquisition date. The Company's debt to  capitalization  ratio
at January  31,  1999 and 1998 was 47.7% and 49.0%,  respectively.  The  Company
maintains  various debt  agreements,  which are  described in more detail in the
footnotes to the consolidated financial statements.  Required principal payments
in fiscal 1999 are expected to be approximately $530,000.

The  Company  believes  that  it can  fund  proposed  capital  expenditures  and
operational  requirements from operations and currently  available cash and cash
equivalents,  investments,  trading  securities  and existing bank credit lines.
Proposed  capital  expenditures  for the fiscal year ending January 31, 2000 are
expected to total  approximately  $900,000,  compared to  $3,082,725  for fiscal
1998. The  significant  decrease is due  principally to the  construction  of an
addition at the Company's Port Washington  facility and the  implementation of a
new ERP system in fiscal 1998.  The Company  also intends to sell its  Cedarburg
facility  which  is  classified  as an asset  held for sale in the  consolidated
balance  sheet.  The  Company's  asking  price for the  facility is  $1,295,000,
although there can be no assurance as to when or if this facility may be resold.

The Company  intends to continue to expand its  businesses,  both internally and
through  potential  acquisitions.  The Company  currently  anticipates  that any
potential  acquisitions  would be financed  primarily  by  internally  generated
funds, additional borrowings or the issuance of the Company's stock.


                                       7
<PAGE>



Year 2000

During fiscal 1998, the Company engaged in a comprehensive project to select and
implement a new enterprise  resource  planning ("ERP") system that will properly
recognize  the Year  2000  problem.  This  project  involved  replacing  certain
hardware and  software  maintained  by the  Company.  The Company has received a
representation  from the ERP  software  provider  that its software is Year 2000
compliant.  On February 1, 1999, the Company started  operating with the new ERP
system.  Contingency  plans have been  developed and will be implemented if Year
2000 problems are encountered with the new ERP system.

The total cumulative cost of the project was approximately  $530,000.  Purchased
ERP system hardware and software,  approximately $385,000 of the total estimated
cost, was capitalized in accordance with normal policy.  Personnel and all other
remaining costs related to the project were expensed as incurred.

The Company has not formally  communicated  with all its customers and suppliers
to  determine  the extent to which the  Company  is  vulnerable  to those  third
parties' failure to address Year 2000 issues. The Company's business  operations
could be affected by the Year 2000  readiness of its  customers and suppliers in
such areas as the delay in receipt of cash from customers,  the  interruption of
utilities  and the  inability of suppliers  to deliver in a timely  manner.  The
Company does not anticipate any materially adverse affect on its business due to
Year 2000 problems encountered by its customers or suppliers; however, there can
be no assurance that its business will not be materially  adversely  affected by
such problems.


                                       8
<PAGE>

SUMMARY OF SELECTED FINANCIAL DATA
<TABLE>
<CAPTION>

EDISON CONTROL CORPORATION

                                                              Year Ended January 31,               Year Ended December 31
                                              ---------------------------------------------- -----------------------------
                                                    1999             1998          1997              1995          1994
                                                    ----             ----          ----              ----          ----
Statements of Operations
<S>                                              <C>            <C>             <C>            <C>            <C>        
Net sales                                        $ 25,050,116   $ 23,875,214    $13,604,340    $    791,502   $ 1,444,004
Cost of sales                                    $ 16,125,601   $ 14,717,711    $ 9,191,243    $    660,857   $ 1,005,326
Gross profit                                     $  8,924,515   $  9,157,503    $ 4,413,097    $    130,645   $   438,678
Selling, engineering & administrative            $  4,560,257   $  4,350,273    $ 3,238,168    $    729,267   $   676,857
Operating income (loss)                          $  4,045,728   $  4,190,142    $   531,702    $   (598,622)  $  (238,179)

Realized gains (losses) on trading securities    $    161,598   $    (54,837)   $ 2,802,490    $  2,214,145   $   712,530

Unrealized (losses) gains on trading securities  $   (375,863)  $   (205,618)   $(2,854,059)   $  1,842,902   $  (193,830)

Interest, dividends and other income             $     75,574   $     63,276       $ 84,848    $     39,598   $   187,818

Income (loss) before cumulative effect           $  1,202,330   $  1,105,162    $  (731,028)   $  2,082,582   $   382,780

Cumulative effect of change in accounting
  principle, net of income taxes                 $          -   $          -    $         -    $          -   $ 1,447,567

Net income (loss)                                $  1,202,330   $  1,105,162    $  (731,028)   $  2,082,582   $ 1,830,347

Per Share Information
Net income (loss) per share - basic              $       0.52   $       0.49    $     (0.33)   $       0.98        $ 0.87
                                                                                                       
Net income (loss) per share - diluted            $       0.42   $       0.41    $     (0.33)   $       0.94        $ 0.84
                                                                                                       
Book value at year end                           $       6.90   $       6.41    $      5.98    $       4.86        $ 3.89
                                                                                                 
At Year End                                       
Working capital                                  $ 12,730,093   $ 10,873,332    $11,554,170    $ 10,299,875   $ 8,101,993
Property, plant and equipment-net                $  8,187,899   $  6,945,103    $ 7,077,228    $     65,687   $    65,618
Total assets                                     $ 34,902,997   $ 32,355,957    $34,060,105    $ 12,553,486   $ 9,332,572
Long-term debt                                   $ 14,741,601   $ 14,023,342    $16,907,424    $          -   $         -
Shareholders' equity                             $ 16,183,272   $ 14,590,525    $13,601,241    $ 10,375,912   $ 8,176,330

Weighted average shares outstanding
      -assuming dilution                            2,883,133      2,686,951      2,558,232       2,209,117     2,174,918

Common stock outstanding                            2,346,933      2,275,933      2,275,933       2,136,000     2,100,000

Note:   As discussed in the  Management's  Discussion  and Analysis of Financial
        Condition and Results of  Operations,  significant  changes were made to
        the Company's core business in fiscal 1996.

Note:   The Company adopted the provisions of FASB 115,  "Accounting for Certain
        Investments  in Debt and Equity  Securities."  The  Company  adopted the
        provisions  of the new  standard for  securities  held as of or acquired
        after January 1, 1994.  The  cumulative  effect as of January 1, 1994 of
        adopting  Statement No. 115  increased net income by $1,447,567  (net of
        $962,635 in deferred income taxes), or $.69 per share-basic and $.67 per
        share-diluted.


</TABLE>

                                       9
<PAGE>


INDEPENDENT AUDITORS' REPORT



To the Board of Directors and Shareholders
  Of Edison Control Corporation:

We have audited the accompanying  consolidated  balance sheets of Edison Control
Corporation  and  subsidiaries  (the  "Corporation")  as of January 31, 1999 and
1998,  and the related  consolidated  statements  of  operations,  shareholders'
equity,  and cash flows for each of the three years in the period ended  January
31, 1999. These financial statements are the responsibility of the Corporation's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements based on our audits.

We  conducted  our  audits  in  accordance  with  generally   accepted  auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion,  such consolidated  financial  statements present fairly, in all
material  respects,  the financial  position of Edison Control  Corporation  and
subsidiaries  as of  January  31,  1999  and  1998,  and the  results  of  their
operations  and their cash flows for each of the three years in the period ended
January 31, 1999, in conformity with generally accepted accounting principles.




Deloitte & Touche LLP
Milwaukee, Wisconsin
March 26, 1999


                                       10
<PAGE>


EDISON CONTROL CORPORATION
<TABLE>
<CAPTION>

CONSOLIDATED BALANCE SHEETS
JANUARY 31, 1999 AND 1998
--------------------------------------------------------------------------------------------------------------

ASSETS (Note 8)                                                                1999               1998

CURRENT ASSETS:
<S>                                                                      <C>                <C>         
  Cash and cash equivalents (Note 1)                                     $    468,072       $  1,037,288
  Investments (Note 1)                                                        190,000            190,000
  Trading securities (Notes 1 and 3)                                        3,616,314          3,653,763
  Accounts receivable, less allowance of                                                
    $268,000 and $320,000, respectively (Note 1)                            3,513,342          2,995,637
  Receivable from affiliate (Note 5)                                           93,575            103,482
  Inventories (Notes 1 and 4)                                               7,619,746          5,974,302
  Prepaid expenses and other current assets                                   193,650            193,099
  Deferred  income taxes (Note 7)                                               2,000
  Refundable income taxes (Note 7)                                            120,505             81,182
  Assets held for sale (Note 1)                                             1,032,200  
  Deferred financing costs (Note 10)                                          389,236            983,333
                                                                         ------------       ------------
           Total current assets                                            17,238,640         15,212,086

INVESTMENT IN AND ADVANCES TO AFFILIATE (Note 5)                              421,263            433,150

OTHER ASSETS:
  Prepaid pension (Note 9)                                                    151,477            283,134
  Deferred  income taxes (Note 7)                                             129,000
  Deferred financing costs (Note 10)                                                             389,236
                                                                         ------------       ------------
           Total other assets                                                 280,477            672,370

PROPERTY, PLANT AND EQUIPMENT  (Note 1):                                                
  Cost:                                                                                 
    Land                                                                      302,902            343,059
    Buildings and improvements                                              3,603,659          2,788,014
    Machinery and equipment                                                 5,869,300          4,729,916
    Construction in progress                                                   10,908             47,014
                                                                         ------------       ------------
                                                                            9,786,769          7,908,003
  Less - accumulated depreciation                                          (1,598,870)          (962,900)
                                                                         ------------       ------------
                                                                            8,187,899          6,945,103

GOODWILL (net of amortization of $600,000 and                               8,690,318          8,922,576
 $367,741, respectively) (Note 1)

ORGANIZATIONAL/FINANCE COSTS (net of
  amortization of $226,670 and $140,398, respectively)(Note 1)                 84,400            170,672
                                                                         ------------       ------------

TOTAL                                                                    $ 34,902,997       $ 32,355,957
                                                                         ============       ============

</TABLE>


                                       11
<PAGE>

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------

LIABILITIES AND SHAREHOLDERS' EQUITY                                                  1999                    1998

CURRENT LIABILITIES:
<S>                                                                               <C>                    <C>         
  Trade accounts payable                                                          $  1,939,917           $  1,261,244
  Accrued compensation                                                                 739,938                781,566
  Taxes other than income taxes                                                         21,325                 29,985
  Other accrued expenses (Note 6)                                                      522,694                555,045
  Deferred income taxes (Note 7)                                                                              115,000
  Deferred compensation (Notes 1 and 10)                                               754,250                754,250
  Current maturities on long-term debt (Note 8)                                        530,423                841,664
                                                                                  ------------           ------------
           Total current liabilities                                                 4,508,547              4,338,754


LONG-TERM DEBT, LESS CURRENT MATURITIES (Note 8)                                    14,211,178             13,181,678

DEFERRED INCOME TAXES (Note 7)                                                                                245,000
                                                                                  ------------           ------------

           Total liabilities                                                        18,719,725             17,765,432


SHAREHOLDERS' EQUITY (Note 10):                                                                    
  Preferred Stock, $.01 par value; 1,000,000 shares authorized,                                    
    none issued                                                                                    
  Common Stock, $.01 par value; 20,000,000 shares authorized,                                      
    2,346,933 and 2,275,933 shares issued and outstanding, respectively                 23,469                 22,759
  Additional paid-in capital                                                        10,323,225             10,016,435
  Retained earnings                                                                  5,760,823              4,558,493
  Accumulated other comprehensive income                                                75,755                 (7,162)
                                                                                  ------------           ------------
           Total shareholders' equity                                               16,183,272             14,590,525
                                                                                  ------------           ------------

TOTAL                                                                             $ 34,902,997           $ 32,355,957
                                                                                  ============           ============

See notes to consolidated financial statements.

</TABLE>


                                       12
<PAGE>

<TABLE>
<CAPTION>

EDISON CONTROL CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS
YEARS ENDED JANUARY 31, 1999, 1998 and 1997
---------------------------------------------------------------------------------------------------------------
                                                                        Year Ended January 31
                                                       --------------------------------------------------------
                                                             1999               1998                1997

<S>                                                        <C>                 <C>                <C>         
NET SALES                                                  $ 25,050,116        $ 23,875,214       $ 13,604,340

COST OF GOODS SOLD                                           16,125,601          14,717,711          9,191,243
                                                           ------------        ------------       ------------

GROSS PROFIT                                                  8,924,515           9,157,503          4,413,097

OTHER OPERATING EXPENSES:
  Selling, engineering and administrative expenses            4,560,257           4,350,273          3,238,168
  Stock option amortization (Note 10)                                               298,558            455,691
  Goodwill and organizational/finance cost
    amortization (Note 1)                                       318,530             318,530            187,536
                                                           ------------        ------------       ------------
           Total other operating expenses                     4,878,787           4,967,361          3,881,395
                                                           ------------        ------------       ------------

OPERATING INCOME                                              4,045,728           4,190,142            531,702

OTHER EXPENSE (INCOME):
  Interest expense                                              955,818           1,133,382            775,762
  Realized (gains) losses on trading securities                (161,598)             54,837         (2,802,490)
  Unrealized losses on trading securities                       375,863             205,618          2,854,059
  Interest and miscellaneous income                             (75,574)            (63,276)           (84,848)
  Loss on sale of assets, net (Note 2)                                                                 434,166
  Stock warrant amortization (Note 10)                          983,333             983,333            594,097
  Equity in earnings of affiliate (Note 5)                      (84,444)            (78,914)           (18,016)
                                                           ------------        ------------       ------------
           Total other expense (income)                       1,993,398           2,234,980          1,752,730
                                                           ------------        ------------       ------------
INCOME (LOSS) BEFORE INCOME TAXES                             2,052,330           1,955,162         (1,221,028)

INCOME TAXES (CREDIT) (Note 7)                                  850,000             850,000           (490,000)
                                                           ------------        ------------       ------------

NET  INCOME (LOSS)                                            1,202,330           1,105,162           (731,028)

OTHER COMPREHENSIVE INCOME (LOSS)-
  Foreign currency translation adjustments (Note 1)              82,917            (115,878)           108,716
                                                           ------------        ------------       ------------

COMPREHENSIVE  INCOME (LOSS)                               $  1,285,247         $   989,284       $   (622,312)
                                                           ============        ============       ============


NET INCOME (LOSS) PER SHARE (Note 1):
Net Income (Loss) Per Share - Basic                        $       0.52         $      0.49       $      (0.33)
                                                           ============        ============       ============

Net Income (Loss) Per Share - Diluted                      $       0.42         $      0.41       $      (0.33)
                                                           ============        ============       ============

See notes to consolidated financial statements. 
See notes to consolidated financial statements.

</TABLE>


                                       13
<PAGE>


EDISON CONTROL CORPORATION
<TABLE>
<CAPTION>

CONSOLIDATED STATEMENTS OF  SHAREHOLDERS' EQUITY
YEARS ENDED JANUARY 31, 1999, 1998 and 1997
------------------------------------------------------------------------------------------------------------------------------------

                                                                                                         
                                                                                                       Accumulated    
                                                    Common Stock          Additional                      Other       
                                             -------------------------     Paid-in         Retained    Comprehensive 
                                                 Shares        Amount      Capital         Earnings       Income         Total

<S>                                           <C>            <C>         <C>             <C>                          <C>         
BALANCES, JANUARY 31, 1996                    2,136,000      $ 21,360    $ 6,143,334     $ 4,184,359                  $ 10,349,053

  Stock issued at acquisition (Note 10)         114,933         1,149        860,851                                       862,000
  Stock warrants issued (Note 10)                                          2,950,000                                     2,950,000
  Stock options exercised (Note 10)              25,000           250         62,250                                        62,500
  Foreign currency translation adjustment                                                               $ 108,716          108,716
  Net (loss)                                                                                (731,028)                     (731,028)
                                              ---------      --------    -----------     -----------    ---------     ------------

BALANCES, JANUARY 31, 1997                    2,275,933        22,759     10,016,435       3,453,331      108,716       13,601,241
 
  Foreign currency translation adjustment                                                                (115,878)        (115,878)
  Net income                                                                               1,105,162                     1,105,162
                                              ---------      --------    -----------     -----------    ---------     ------------

BALANCES, JANUARY 31, 1998                    2,275,933        22,759     10,016,435       4,558,493       (7,162)      14,590,525

  Stock options exercised (Note 10)              71,000           710        306,790                                       307,500
  Foreign currency translation adjustment                                                                  82,917           82,917
  Net income                                                                               1,202,330                     1,202,330
                                              ---------      --------    -----------     -----------    ---------     ------------

BALANCES, JANUARY 31, 1999                    2,346,933      $ 23,469    $10,323,225     $ 5,760,823    $  75,755     $ 16,183,272
                                              =========      ========    ===========     ===========    =========     ============

See notes to consolidated financial statements.

</TABLE>


                                       14
<PAGE>

EDISON CONTROL CORPORATION
<TABLE>
<CAPTION>

CONSOLIDATED STATEMENTS OF CASH FLOWS
YEARS ENDED JANUARY 31, 1999, 1998 and 1997
---------------------------------------------------------------------------------------------------------------

                                                                                  Year Ended January 31
                                                                   --------------------------------------------
                                                                         1999          1998           1997
OPERATING ACTIVITIES:
<S>                                                                  <C>           <C>             <C>         
  Net income (loss)                                                  $ 1,202,330   $ 1,105,162     $  (731,028)
  Adjustments to reconcile net income (loss) to net cash                                        
    provided by operating activities:                                                           
    Depreciation of plant and equipment                                  766,497       653,089         328,421
    Amortization                                                       1,301,863     1,600,421       1,235,253
    Provision for doubtful accounts                                      (39,931)       76,780          10,127
    Realized (gain) loss on trading securities sales                    (161,598)       54,837      (2,802,490)
    Unrealized loss on trading securities                                375,863       205,618       2,854,059
    Purchases of trading securities                                   (2,530,113)   (3,768,475)     (9,003,912)
    Proceeds from the sales of trading securities                      2,353,297     4,605,945      15,409,029
    Loss on sale of assets                                                26,202        19,973         396,318
    Equity in earnings of affiliate                                      (84,444)      (78,914)        (18,016)
    Changes in assets and liabilities, net of acquired companies:                               
      Accounts receivable                                               (456,077)     (377,314)       (140,961)
      Receivable from affiliate                                            9,907        52,553          44,973
      Inventories                                                     (1,611,616)     (679,253)      1,417,211
      Prepaid expenses and other assets                                    1,356         1,395          23,928
      Prepaid pension                                                    131,657       101,887          57,577
      Trade accounts payable                                             676,489       388,713         (71,315)
      Accrued compensation                                               (41,965)      175,254          78,084
      Taxes other than income taxes                                          724        (2,223)        (44,774)
      Other accrued expenses                                             (43,183)       19,550         101,490
      Income taxes                                                        94,636       (97,324)       (538,285)
      Deferred income taxes                                             (491,000)     (386,000)     (1,370,871)
                                                                     -----------   -----------     -----------

           Net cash provided by operating activities                   1,480,894     3,671,674       7,234,818
                                                                     -----------   -----------     -----------

INVESTING ACTIVITIES:                                                                           
  Additions to plant and equipment                                    (3,082,725)     (554,923)       (416,340)
  Maturity of certificate of deposit                                                    94,000  
  Payments received from (advances to) affiliate                          96,331       (14,182)         45,823
  Proceeds from sale of assets                                            24,122         4,741           9,819
  Payment for the purchase of acquired companies, net of 
  cash acquired                                                                                    (18,914,093)
                                                                     -----------   -----------     -----------

           Net cash used in investing activities                      (2,962,272)     (470,364)    (19,274,791)
                                                                     -----------   -----------     -----------

FINANCING ACTIVITIES:                                                                           
  Proceeds from issuance of long-term debt                             2,175,000       600,000      16,540,000
  Payments on long-term debt                                          (1,456,741)   (3,484,082)     (4,531,936)
  Proceeds from issuance of common stock                                                                95,724
  Stock options exercised                                                177,500                        62,500
                                                                     -----------   -----------     -----------

           Net cash provided by (used in) financing activities           895,759    (2,884,082)     12,166,288
                                                                     -----------   -----------     -----------


                                                                                               (Continued)
</TABLE>


                                       15
<PAGE>



EDISON CONTROL CORPORATION
<TABLE>
<CAPTION>

CONSOLIDATED STATEMENTS OF CASH FLOWS
YEARS ENDED JANUARY 31, 1999, 1998 and 1997
-----------------------------------------------------------------------------------------------------------

                                                                       Year Ended January 31
                                                      -----------------------------------------------------
                                                              1999             1998               1997



<S>                                                       <C>               <C>                <C>        
EFFECT OF EXCHANGE RATE CHANGES ON CASH                   $    16,403       $   (51,948)       $    46,762
                                                          -----------       -----------        -----------

NET (DECREASE) INCREASE IN CASH AND                                                        
  CASH EQUIVALENTS                                           (569,216)          265,280            173,077

CASH AND CASH EQUIVALENTS,                                                                 
  BEGINNING OF YEAR                                         1,037,288           772,008            598,931
                                                          -----------       -----------        -----------

CASH AND CASH EQUIVALENTS,                                                                 
  END OF YEAR                                             $   468,072       $ 1,037,288        $   772,008
                                                          ===========       ===========        ===========

SUPPLEMENTAL DISCLOSURE OF CASH FLOW
  INFORMATION:
    Cash paid during the year for:
      Interest                                            $   946,210       $ 1,111,901        $   773,954
      Income taxes, net of refunds                        $ 1,246,200       $ 1,336,130        $ 1,419,070

SUPPLEMENTAL SCHEDULE OF NON-CASH
  INVESTING AND FINANCING ACTIVITIES:
      Stock issued as part of purchase price of
        acquired companies                                                                     $   766,274
      Notes receivable canceled as part of purchase
        price of acquired companies                                                            $   332,400
      Fair value of warrant issued in connection with
        financing of acquisition                                                               $ 2,950,000


See notes to consolidated financial statements.

</TABLE>



                                       16
<PAGE>



EDISON CONTROL CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 1999, 1998 and 1997
--------------------------------------------------------------------------------


1.     NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES

       Principles  of  Consolidation  - The  consolidated  financial  statements
       include  the  accounts  of  Edison  Control  Corporation  ("Edison")  and
       subsidiaries,   all  of  which  are  wholly  owned   (collectively,   the
       "Company"). All material intercompany accounts and transactions have been
       eliminated in consolidation.

       Nature  of  Operations  - The  Company  is  currently  comprised  of  the
       following  operations.  Construction  Forms  ("ConForms")  is  a  leading
       manufacturer and distributor of systems of pipes, couplings and hoses and
       other equipment used for the pumping of concrete. ConForms manufactures a
       wide variety of finished  products  which are used to create  appropriate
       configurations  of  systems  for  various  concrete  pumps.   Ultra  Tech
       manufactures abrasion resistant piping systems for use in industries such
       as mining,  pulp and paper,  power and waste treatment.  Gilco produces a
       line of  concrete  and  plaster/mortar  mixers.  JABCO  primarily  leases
       property and equipment to the Company.

       The  Company's  principal  market is in North  America with limited sales
       activity in Europe, South America and Asia.

       Cash Equivalents - The Company  considers all temporary  investments with
       maturities of three months or less when acquired to be cash equivalents.

       Investments  -  Investments  consist  of  certificates  of  deposit  with
       maturities  in excess of three  months  and are  recorded  at cost  which
       approximates  market.  The Company intends to hold the certificates until
       maturity.

       Trading  Securities  - Debt  and  equity  securities  purchased  and held
       principally  for the  purpose  of  selling  them  in the  near  term  are
       classified  as  "trading  securities"  and  reported  at fair  value with
       unrealized gains and losses included in earnings.  The cost of securities
       sold is based on the first-in, first-out method.

       Accounts  Receivable - Accounts receivable are stated net of an allowance
       for doubtful accounts and finance charges.

       Inventories  - Inventories  are stated at the lower of cost  (principally
       last-in, first-out method) or market.

       Assets held for sale - Assets held for sale consist of land and building,
       which are no longer in use as of January  31,  1999.  These  assets  were
       reclassified from property, plant and equipment and are recorded at their
       net book value. No depreciation has been taken on these assets since they
       were taken out of service. The Company classifies these assets as current
       assets  since it believes  that these assets will be sold within the next
       twelve months.

       Property,  Plant and Equipment - Property,  plant and equipment is stated
       at  cost.   Expenditures   for  major  renewals  and   improvements   are
       capitalized,  while  maintenance and repairs,  which do not significantly
       improve  the  related  asset or extend its useful  life,  are  charged to
       expense as incurred.


                                       17
<PAGE>



       For financial  reporting  purposes,  plant and  equipment is  depreciated
       primarily by the straight-line  method over the estimated useful lives of
       the assets.  Estimated useful lives of buildings and  improvements  range
       from 7 to 40 years and of  machinery  and  equipment  from 2 to 12 years.
       Depreciation  claimed for income tax purposes is computed by  accelerated
       methods.

       Goodwill and  Intangible  Assets - Goodwill  represents the excess of the
       purchase price over the fair value of identifiable net assets of acquired
       companies and is amortized on a  straight-line  basis over 40 years.  The
       Company  assesses  the carrying  value of goodwill at each balance  sheet
       date. Consistent with Statement of Financial Accounting Standard ("SFAS")
       No. 121,  "Accounting  for the  Impairment of  Long-Lived  Assets and for
       Long-Lived  Assets to be  Disposed  of",  such  assessments  include,  as
       appropriate,  a comparison of the  estimated  future  nondiscounted  cash
       flows  anticipated  to be  generated  during the  remaining  amortization
       period of the goodwill to the net carrying value of goodwill. The Company
       recognizes  diminution in value of goodwill,  if any, on a current basis.
       Organizational/finance  costs are amortized  over their  economic  useful
       lives ranging from three to twenty years.

       Estimates - The  preparation of financial  statements in conformity  with
       generally  accepted  accounting  principles  requires  management to make
       estimates and assumptions  that affect the reported amounts of assets and
       liabilities  and disclosure of contingent  assets and  liabilities at the
       date of the financial statements and the reported amounts of revenues and
       expenses  during the reporting  period.  Actual results could differ from
       those estimates.

       Fair Value of Financial  Instruments  - Management  believes the carrying
       amount of  financial  instruments  is a  reasonable  estimate of the fair
       value of these instruments.

       Translation  of Foreign  Currencies - Assets and  liabilities  of foreign
       operations are translated into United States dollars at current  exchange
       rates.  Income and expense  accounts are  translated  into United  States
       dollars at average  exchange  rates for the periods and capital  accounts
       have been translated  using historical  rates. The resulting  translation
       adjustments are recorded as other comprehensive income.

       Revenue  Recognition  - The Company  recognizes  revenue upon shipment of
       products.

       Research and Development - Amounts  expended for research and development
       for the years ended January 31, 1999, 1998 and 1997 totaled approximately
       $212,000,  $190,000  and  $190,000,  respectively,  and are  expensed  as
       incurred.


                                       18
<PAGE>



       Net income  (loss) per share - Effective  for 1997,  the Company  adopted
       Statement of Financial  Accounting  Standards  ("SFAS") No. 128 "Earnings
       Per Share," which  established  new standards for the  calculation of net
       income per share  effective for interim and annual  periods  ending after
       December  1997.  Income per share for the year ended January 31, 1997 has
       been  restated  to  comply  with  SFAS  No.  128.  Reconciliation  of the
       numerator and denominator of the basic and diluted per share computations
       are summarized as follows:

<TABLE>
<CAPTION>


                                                                      Year Ended January 31
                                                        -----------------------------------------------
                                                                 1999            1998           1997
                                                                 ----            ----           ----
Net Income (Loss) Per Share - Basic:
<S>                                                          <C>             <C>            <C>        
   Net income (loss)  (numerator)                            $ 1,202,330     $ 1,105,162    $ (731,028)
   Weighted average shares outstanding (denominator)           2,315,503       2,275,933     2,210,848
   Net income (loss)  per share - basic                           $ 0.52          $ 0.49       $ (0.33)
Net Income (Loss) Per Share - Diluted:
   Net income (loss)  (numerator)                            $ 1,202,330     $ 1,105,162    $ (731,028)
   Weighted average shares outstanding                         2,315,503       2,275,933     2,210,848
   Effect of dilutive securities:
         Stock options                                           178,257          99,224             -
         Stock warrants                                          389,373         311,794             -
                                                             -----------     -----------    ----------
   Weighted average shares outstanding (denominator)           2,883,133       2,686,951     2,210,848

   Net income (loss)  per share - diluted                    $      0.42     $      0.41    $    (0.33)
</TABLE>


       Stock options and warrants were  antidilutive  for the year ended January
       31, 1997 under the treasury stock method.

       Accounting  Pronouncements - In 1998, the Financial  Accounting Standards
       Board issued SFAS No. 133,  "Accounting  for Derivative  Instruments  and
       Hedging  Activities."  The  Company is in the process of  evaluating  the
       accounting and reporting  requirements  and does not believe the adoption
       of SFAS No. 133 will have a material impact on the Company's consolidated
       financial statements.

       Reclassifications - Certain reclassifications have been made to the prior
       years'   financial   statements   to  conform   with  the  current   year
       presentation.


                                       19
<PAGE>



2.     ACQUISITIONS AND DISPOSITIONS

       On June 21, 1996, the Company purchased all of the issued and outstanding
       stock of Construction  Forms, Inc. and subsidiaries and JABCO, LLC for an
       aggregate  cash   consideration   of   approximately   $20,550,000.   The
       acquisition was accounted for as a purchase transaction with the purchase
       price  allocated  to the  fair  value of  specific  assets  acquired  and
       liabilities  assumed.  Accordingly,  the results of operations  have been
       included since the date of the acquisition.  Resultant  goodwill is being
       amortized over 40 years. The purchase price was allocated as follows:

           Receivables                                $ 2,810,237
           Inventory                                    6,699,256
           Property, plant and equipment                6,990,408
           Goodwill                                     9,290,317
           Prepaid pension                                442,598
           Cash and other assets                        1,714,648
           Liabilities assumed                         (7,397,464)
                                                     ------------
                                                     $ 20,550,000
                                                     ============

       On  October  31,  1996,  the  Company  sold  certain  net  assets  of its
       electronic  fault indicator  operation.  In return,  the Company received
       cash of $10,000, a $275,000 promissory note bearing interest at an annual
       rate of 8.25%,  and a five year  warrant to  purchase  20% of the capital
       stock of the new company. It is management's opinion that the possibility
       of collection of any future  principal or interest on the note receivable
       is remote and,  accordingly,  has reserved the total  balance of the note
       and will not record any interest income until received. The total loss on
       the sale of these net assets was $434,166,  including the note receivable
       reserve.

                                       20
<PAGE>


3.     TRADING SECURITIES

     Trading securities at January 31, 1999 consisted of the following:

                                  Number of
Name of Issuer/                   Shares or
Title of Issue                      Units            Cost        Market Value

Common Stocks:
  Cendant Corp.                      20,000     $   435,438     $   435,000
  Equity One, Inc.                    9,500         104,500          85,500
  Glenayre Technologies, Inc.        40,000       1,029,352         200,000
  Microsoft                           2,000         250,050         350,000
  Panavision Inc.                       304           8,150           3,420
  Philip Morris                       5,000         266,875         234,375
  Sun International Hotels           10,100         448,250         431,144
  US Trust Corporation               25,000         411,953       1,825,000
  VIVUS, Inc.                        20,000         621,350          51,875
                                                -----------     -----------

Total                                           $ 3,575,918     $ 3,616,314
                                                ===========     ===========


     Trading securities at January 31, 1998 consisted of the following:

                                  Number of
Name of Issuer/                   Shares or
Title of Issue                      Units            Cost        Market Value

Common Stocks:
  General Motors Corp.                5,000     $   147,325     $   173,125
  Glenayre Technologies, Inc.        40,000       1,029,352         527,500
  NCR Corp.                          10,000         278,750         300,625
  Oxford Health Plans, Inc.          10,000         160,000         175,000
  Panavision Inc.                     6,400         139,750         166,800
  Raytheon                            2,812         118,925         143,763
  Sun International Hotels           10,100         330,100         386,325
  US Trust Corporation               25,000         411,953       1,484,375
  VIVUS, Inc.                        20,000         621,350         296,250
                                                -----------     -----------
                                             
Total                                           $ 3,237,505     $ 3,653,763
                                                ===========     ===========

                                       21
<PAGE>


4.     INVENTORIES

       Inventories consisted of the following:

                                                    January 31,    January 31,
                                                        1999           1998

       Raw materials                               $ 4,158,860    $ 2,945,598
       Work-in-process                                 992,073        818,003
       Finished goods                                2,631,813      2,325,701
                                                   -----------     ----------
                                                     7,782,746      6,089,302
                                               
       Less - reserve to reduce carrying value 
         to LIFO cost                                 (163,000)      (115,000)
                                                   -----------    -----------
                                               
       Net inventories                             $ 7,619,746    $ 5,974,302
                                                   ===========    ===========



5.     INVESTMENT IN AND ADVANCES TO AFFILIATE

       The Company owns 50% of the  outstanding  common  stock of South  Houston
       Hose Company and accounts for the  investment by the equity  method.  The
       Company had sales of approximately $900,000, $798,000 and $685,000 to the
       affiliate  during 1998, 1997 and 1996,  respectively.  Summary  unaudited
       financial  information as of January 31, 1999, 1998 and 1997, and for the
       years then ended is as follows:

     
                                     1999              1998             1997
       
       Current assets           $ 1,208,819      $ 1,130,349         $ 934,399
       Noncurrent assets             60,439           45,878            49,930
       Current liabilities          311,764          388,727           306,198
       Noncurrent liabilities             -                -            41,555
       Shareholders' equity         957,494          787,500           633,364
       Net sales                  3,278,014        2,749,253         2,239,949
       Net income                   169,994          154,136            90,858
       

                                       22
<PAGE>


6.     ACCRUED EXPENSES

       Accrued expenses consisted of the following:

                                                 Year Ended January 31,
                                          ------------------------------------
                                                1999              1998

              Group benefits                 $  130,000         $ 130,000
              Warranty                          207,500           240,000
              Legal and professional             56,758            47,468
              Interest                           54,577            58,510
              Selling commissions                25,188            28,519
              Other                              48,671            50,548
                                             ----------         ---------
              Total                           $ 522,694         $ 555,045
                                             ==========         =========


7.     INCOME TAXES

       Deferred income taxes are provided on temporary  differences  relating to
       reporting  expenses in  different  periods for  financial  statement  and
       income tax purposes and  differences in bases of assets and  liabilities.
       Such  differences   relate  primarily  to  unrealized  gain  (losses)  on
       investments,  depreciation  expense,  inventory  costs, bad debt expense,
       warranty costs, insurance, compensation and pension expense.

       The provision for income taxes (credit) is as follows:

                                              Year Ended January 31             
                                 ---------------------------------------------  
                                      1999              1998            1997    
                                                                                
       Currently payable:                                                       
         Federal                  $ 1,144,000      $ 1,066,000     $  718,871   
         State                        197,000          170,000        162,000   
                                  -----------      -----------     ----------   
                                    1,341,000        1,236,000        880,871   
       Deferred:                                                                
         Federal                     (416,000)        (332,000)    (1,120,871)  
         State                        (75,000)         (54,000)      (250,000)  
                                  -----------      -----------     ----------   
                                     (491,000)        (386,000)    (1,370,871)  
                                  -----------      -----------     ----------   
                                                                                
       Total                      $   850,000      $   850,000      $ (490,000) 
                                  ===========      ===========     ==========   

                                       23
<PAGE> 

       


       Temporary  differences  which  gave  rise  to  the  deferred  tax  assets
       (liabilities) included the following items at January 31, 1999 and 1998:


                                                          1999           1998  
       Deferred tax assets:                                                    
       Compensation and other employee benefits     $   313,000      $ 312,000 
       Book reserves and other items                     18,000         97,000 
       Net operating loss carryforwards                                  3,000 
       Deferred financing                               999,000        615,000 
       Vacation pay                                      73,000         67,000 
                                                      ---------      --------- 
                                                      1,403,000      1,094,000 
                                                      ---------      --------- 
       Deferred tax liabilities:                                               
       Inventory items                                 (642,000)      (638,000)
       Unrealized gains                                 (16,000)      (162,000)
       Fixed assets                                    (555,000)      (544,000)
       Pension benefit                                  (59,000)      (110,000)
                                                      ---------      --------- 
                                                     (1,272,000)    (1,454,000)
                                                      ---------      --------- 
                                                                               
       Net deferred tax asset (liability)           $   131,000      ($360,000)
                                                     ==========     ========== 
                                                                               
                                                                               
       The  reconciliation  of income tax computed at the U.S. federal statutory
       rates to income tax expense is:

                                                      Year Ended January 31     
                                               ---------------------------------
                                                   1999      1998      1997     
                                                                                
       Statutory tax rate                          34.0%     34.0%     34.0%    
       State taxes, net of federal tax benefit      6.0       6.0       4.8     
       Goodwill                                     3.8       4.0      (3.8)    
       Dividends received deduction                (0.3)     (0.3)      1.3     
       Reversal of provision for taxes not                                      
         necessary in the future                    0.0       0.0       4.5     
       Other, net                                  (2.1)     (0.2)     (0.7)    
                                                   -----     -----     -----    
                                                                                
       Effective tax rate                          41.4%     43.5%     40.1%    
                                                   =====     =====     =====    
       
                                       24
<PAGE>

8.     LONG-TERM DEBT

       Long-term  debt, less current  maturities,  consisted of the following at
       January 31, 1999 and 1998:

                                                1999              1998     
                                                                           
       Industrial revenue bonds            $  2,750,000      $  2,875,000  
                                                                           
       RLF term loan                             96,582                    
                                                                           
       Bank revolving credit loan             4,700,000         3,225,000  
                                                                           
       Bank overadvance term loan               396,984         1,125,278  
                                                                           
       Subordinated bank loan                 6,798,035         6,798,064  
                                           ------------      ------------  
                                                                           
       Total debt                            14,741,601        14,023,342  
                                                                           
       Less current portion                    (530,423)         (841,664) 
                                           ------------      ------------  
                                                                           
       Total long-term debt                $ 14,211,178      $ 13,181,678  
                                           ============      ============  
       
       The Industrial Revenue Bonds ("IRB") were issued to finance  construction
       of a new production  facility in Port Washington,  Wisconsin.  A total of
       $3,000,000 was issued for the facility and is due in annual  installments
       of $125,000  from  February  1997 through  February  2000,  $150,000 from
       February  2001 through  February  2005,  and $175,000  from February 2006
       through February 2015. The interest rate at January 31, 1999 was 3.75%.

       The Revolving  Loan Fund (RLF) term loan was a loan issued by the City of
       Port   Washington  to  finance  the  purchase  of  real  estate  for  the
       construction of an addition at the Company's Port Washington  facility. A
       total of  $100,000  was  issued  for the  facility  and is due in monthly
       installments  through September 4, 2008. The interest rate at January 31,
       1999 was 4.0%.

       The master  credit  agreement,  which  expires June 21, 2000,  allows for
       revolving credit  borrowings not to exceed  $6,000,000.  Borrowings which
       are based on qualified assets bear interest at either the prime rate plus
       .50% or the LIBOR rate plus 1.25% on the first  $1,800,000 of debt (6.33%
       at January  31,  1999) and the LIBOR rate plus 2.00% on amounts in excess
       of $1,800,000 (7.08% at January 31, 1999).

       Also  under  the  master  credit  agreement,  the  Company  maintains  an
       overadvance term loan. Monthly principal payments of $59,722 are required
       by the agreement.  Borrowings bear interest at either the prime rate plus
       .375% or the LIBOR rate plus 3.1%.  The interest rate at January 31, 1999
       was 8.125%.  The agreement calls for additional  principal payments based
       on excess cash flow as defined in the agreement.

       The terms under the master  credit  agreement,  among  other  provisions,
       require the Company to maintain a minimum  current  ratio,  tangible  net
       worth,  and fixed charge  ratio,  and  restricts the Company to a maximum
       debt to  worth  ratio.  Substantially  all of the  Company's  assets  are
       collateralized under the above debt agreements.


                                       25
<PAGE>




       The  Company  has a  loan  agreement  with  a  bank  which  provides  for
       subordinated   borrowings  up  to  $6,800,000   through  June  21,  2002.
       Borrowings  bear interest at the bank's LIBOR rate plus 1.25%. On January
       31,  1999,  the  interest  rate  was  6.31%.   The  loan  is  secured  by
       substantially  all of the assets of the Company and is  guaranteed by the
       principal stockholder of Edison.

       Annual  principal  payments for the next five years on long-term debt are
       as follows:

<TABLE>
<CAPTION>


 Year Ending                       RLF        Revolving     Overadvance      Subordinated
 January 31,         IRB        Term Loan    Credit Loan     Term Loan        Bank Loan         Total

<S>             <C>              <C>         <C>             <C>            <C>              <C>            
  2000          $    125,000     $  8,439    $               $ 396,984      $                $    530,423
  2001               125,000        8,784      4,700,000                                        4,833,784
  2002               150,000        9,141                                                         159,141
  2003               150,000        9,514                                      6,798,035        6,957,549
  2004               150,000        9,902                                                         159,902
  Thereafter       2,050,000       50,802                                                       2,100,802
                ------------     --------    -----------     ---------      ------------     ------------

                $  2,750,000     $ 96,582    $ 4,700,000     $ 396,984      $  6,798,035     $ 14,741,601
                ============     ========    ===========     =========      ============     ============
</TABLE>


9.     EMPLOYEE RETIREMENT PLANS

       The Company adopted SFAS No. 132, "Employer's  Disclosures about Pensions
       and Other Postretirement  Benefits," in fiscal 1998. SFAS No. 132 revises
       disclosure requirements for such pension and postretirement benefit plans
       to, among other things,  standardize  certain  disclosures  and eliminate
       certain other disclosures no longer deemed useful.  SFAS No. 132 does not
       change the measurement or recognition criteria for such plans.

       The Company has a  noncontributory  defined benefit  pension plan,  which
       relates to the acquired companies,  covering  substantially all full-time
       employees.  The plan provides for benefits  based on years of service and
       compensation.

       The following  tables set forth the plan's change in benefit  obligation,
       change in plan assets and funded status at January 31, 1999 and 1998:

                                       26
<PAGE>

<TABLE>
<CAPTION>

                                                              1999            1998      
       <S>                                                <C>             <C>           
       Change in benefit obligation:                                                    
         Benefit obligation at beginning of year          $ 2,884,024     $ 2,843,888   
         Service cost                                         150,302         135,824   
         Interest cost                                        223,198         186,853   
         Acturial loss (gain)                                 335,398        (152,363)  
         Benefits paid                                       (187,124)       (130,178)  
         Assumption change                                   374,215                    
                                                          ----------      -----------   
         Benefit obligation at end of year                  3,780,013       2,884,024   
                                                                                        
       Change in plan assets:                                                           
         Fair value of plan assets at beginning of year     3,998,045       3,521,285   
         Actual return on plan assets                         690,910         606,938   
         Benefits paid                                       (187,124)       (130,178)  
                                                          -----------     -----------   
                                                            4,501,831       3,998,045   
                                                                                        
       Funded Status                                          721,818       1,114,021   
       Unrecognized net acturial gain                        (570,341)       (830,887)  
                                                          -----------     -----------   
       Prepaid pension expense                            $   151,477     $   283,134   
                                                          ===========     ===========   
                                                                                        
</TABLE>

       Assumptions for the years ended January 31 were:

                                                1999          1998         1997 
                                                                                
            Discount rate                       6.75%         7.50%        7.50%
                                                                                
            Expected return on plan assets      8.00          8.00         8.00 
                                                                                
            Rate of compensation increase       6.00          6.00         6.00 
       
       The Company's funding policy is to contribute annually amounts within the
       limits  which  can be  deducted  for  Federal  income  tax  purposes.  No
       contributions  were made to the Plan during the years  ended  January 31,
       1999, 1998 and 1997.

       Pension expense consisted of the following components for the years ended
       January 31:

<TABLE>
<CAPTION>

                                                                1999           1998         1997   
                                                                                                   
       <S>                                                 <C>             <C>            <C>      
       Service cost-benefits earned during the year        $  150,302      $  135,824     $ 65,707 
                                                                                                   
       Interest cost on projected benefit obligation          223,198         186,853      119,475 
                                                                                                   
       Actual return on plan assets (gain) loss              (690,910)       (606,938)    (369,579)
       Net amortization and deferral                          449,067         386,148      241,974 
                                                           ----------      ----------     -------- 
                                                                                                   
       Net periodic pension expense                        $ 131,657       $  101,887     $ 57,577 
                                                           ==========      ==========     ======== 
       
</TABLE>


       The Company also has a retirement  savings and thrift plan (401(k) plan),
       which relates to the acquired  companies,  covering  substantially all of
       its  employees.  Under the 401(k) plan, the Company  contributes  amounts
       based on employee contributions. Amounts charged to earnings for the plan
       for the years ended January 31, 1999, 1998 and 1997 were $91,059, $80,943
       and $42,831, respectively.

                                       27
<PAGE>


10.    EMPLOYEE STOCK OPTION PLANS

       The Company adopted a 1986 Stock Option Plan (the "Plan") for the benefit
       of directors,  officers and key employees of the Company. Pursuant to the
       Plan, as amended,  these persons may be granted options to purchase up to
       an aggregate of 150,000  shares of Common  Stock.  The Board of Directors
       may authorize  the granting of options under the Plan,  and may determine
       to whom the options may be granted,  the number thereof, the option price
       and the exercise period. The price for incentive stock options, which may
       be granted under the Plan and which meet the requirements of Section 422A
       of the Internal Revenue Code, as amended,  will not be less than the fair
       market value of the Common Stock on the date the option is granted  (100%
       of such fair market  value for an optionee who holds more than 10% of the
       outstanding  shares of the capital stock of the  Company).  The price for
       non-statutory  options  shall be fixed at the  discretion of the Board of
       Directors  and in no event  will the option  price for any  non-statutory
       option  granted be less than 85% of the fair  market  value of the Common
       Stock on the date of grant.  The maximum  exercise  period for any option
       under the Plan is ten years  from the date the  option is  granted  (five
       years for an optionee who holds more than 10% of the  outstanding  shares
       of the capital  stock of the  Company).  In November  1987,  the Board of
       Directors issued non-statutory options to purchase an aggregate of 90,000
       shares at an exercise price of $2.50 per share ("2.50 options"). In 1989,
       the Company issued non-statutory options to purchase an additional 60,000
       shares at an exercise price of $1.22 per share. In November 1996, William
       Finneran purchased 25,000 shares of his options.

       In June 1993,  the Board of  Directors  granted  five-year  non-statutory
       options to  purchase  18,000  shares each to Clark H.  Bailey,  Gerald B.
       Cramer,  John J. Delucca and Jay J. Miller,  and 35,000 shares to William
       B. Finneran,  Directors of the Company, at an exercise price of $2.50 per
       share,  vesting  50% at June 5,  1994 and 50% at June 4,  1995  ("vesting
       $2.50 options").  In June 1995, Clarke H. Bailey exercised his option and
       purchased  18,000  shares.  In September  1997, the options for Gerald B.
       Cramer expired. In May, 1998, John J. Delucca and Jay J. Miller exercised
       their  options and  purchased  18,000  shares  each.  Also,  in May 1998,
       William B. Finneran exercised his options and purchased 35,000 shares.

       In July 1993,  the Board of Directors  granted  non-statutory  options to
       purchase 18,000 shares to John M. Sanzo, a Director of the Company, at an
       exercise  price of $4.00 per share,  vesting 50% at July 15, 1994 and 50%
       at July 15, 1995 ("vesting $4.00 options"). In October 1994, the Board of
       Directors resolved that the stock option, heretofore, granted to Mr. John
       M. Sanzo to be fully  vested  notwithstanding  any term of said option to
       the contrary and that said option  would  expire 120 days  following  the
       effectiveness  of  a  Registration   Statement  on  Form  S-8  under  the
       Securities Act of 1993, as amended. In June 1995, John M. Sanzo exercised
       his option and purchased 18,000 shares.

       In October  1995,  the 1986 Stock  Option Plan was amended to increase by
       200,000 the number of shares of common  stock  authorized  for  issuance,
       thereunder to a total of 350,000 shares.

       In February  1995,  the Board of Directors  authorized and on October 17,
       1995, the  stockholders  approved a grant to the Company's  President and
       Chief  Executive  Officer of a ten-year  option to purchase up to 200,000
       shares of common  stock  pursuant  to the 1986 Option Plan at an exercise
       price of $4.00 per share,  vesting 33% each at date of grant, on February
       1, 1996, and on February 1, 1997, respectively.

       In February 1996, non-qualified options for 17,500 shares were granted to
       three individuals for services rendered at an exercise price of $4.50 per
       share.  The  options  are  exercisable  up to the  close of  business  on
       December 31, 1999.


                                       28
<PAGE>



       In May 1997,  five-year  non-qualified  options  for 25,000  shares  were
       granted  to Robert  Cooney,  a member of the  Board of  Directors,  at an
       exercise  price of $3.50 per share,  vesting 50% at November 29, 1997 and
       50% on May 29, 1998.

       In October 1997, five-year  non-qualified  options for 25,000 shares were
       granted  to  William  Scott,  a member of the Board of  Directors,  at an
       exercise price of $3.50 per share,  vesting 50% at April 15, 1998 and 50%
       on October 15, 1998.

       In connection with the issuance of the  subordinated  debt, the principal
       shareholder  of the Company  provided  collateral  to a bank to support a
       guaranty of repayment by the Company of the principal and interest on the
       loan. The  arrangement was made to reduce the cost of borrowed funds from
       that which  would have been  otherwise  obtainable  by the  Company  from
       unaffiliated  "mezzanine" lenders. In consideration of his providing such
       collateral,  the Company  issued a ten-year  Warrant to purchase  500,000
       shares of Common Stock  exercisable at a price of $1.60 per share. At the
       time  the  transaction  was  negotiated,   Common  Stock  was  quoted  at
       approximately  $4.00 per share. On the date the ConForms  acquisition was
       consummated,  which was the grant date,  the  closing  sale price for the
       Common  Stock in the  over-the-counter  market was $7.50 per  share.  The
       difference  between  the Warrant  price and the fair market  value at the
       grant  date  is  being   amortized  over  the  three-year   term  of  the
       subordinated debt.

       In connection  with the ConForms  acquisition,  the Company  entered into
       agreements  for the sale for investment of an aggregate of 114,933 shares
       of Common Stock for a total  purchase price of $862,000 to key management
       personnel  of  ConForms  and its  affiliates.  In  addition,  the Company
       granted ten-year nonqualified options to purchase an aggregate of 167,611
       shares of Common Stock  exercisable  at $3.00 per share to key personnel.
       Such  options vest fully on the first  anniversary  of the closing of the
       acquisition.  On the date of the grant of the  options,  the closing sale
       price for the Common Stock was $7.50 per share.  The  difference  between
       the  option  price  and the fair  market  value at the time of grant  was
       amortized over the one-year vesting period.

       In January 1999, the Board of Directors approved,  subject to shareholder
       approval,  the Edison Control Corporation 1999 Equity Incentive Plan. The
       Plan provides  that up to a total of 200,000  shares of Common Stock will
       be  available  for the  granting  of stock  options,  stock  appreciation
       rights,  restricted stock or performance  shares.  No awards were granted
       under this Plan as of January 31, 1999.

       The Company has adopted the  disclosure-only  provisions  of SFAS No.123,
       "Accounting  for  Stock-Based   Compensation,"  but  continues  to  apply
       Accounting Principles Board Opinion No. 25 and related interpretations in
       accounting  for all of its  plans.  Compensation  expense  was  $983,333,
       $1,281,891, and $1,049,788 for the years ended January 31, 1999, 1998 and
       1997, respectively.  If the Company had elected to recognize compensation
       costs  for  the  options/warrants  issued  after  December  15,  1994  in
       accordance with SFAS No. 123, net income (loss) and net income (loss) per
       share would have changed to the pro-forma amounts as follows:
<TABLE>
<CAPTION>


                                                               1999            1998          1997
                                                               ----            ----          ----
<S>                                    <C>              <C>             <C>             <C>        
Net income (loss)                      As reported:     $ 1,202,330     $ 1,105,162     $ (731,028)
                                       Pro-forma:         1,754,989       1,240,831     (2,128,210)
Net income (loss) per share -basic     As reported:            0.52            0.49          (0.33)
                                       Pro-forma:              0.76            0.55          (0.96)
Net income (loss) per share -diluted   As reported:            0.42            0.41          (0.33)
                                       Pro-forma:              0.61            0.46          (0.96)
</TABLE>



                                       29
<PAGE>
     

       The fair value of stock  options/warrants  used to compute  and  disclose
       pro-forma  net income (loss) and pro-forma net income (loss) per share is
       the estimated  present value at grant date using the Black Scholes option
       pricing model with the following weighted average assumptions:

                                            Year Ended January 31,
                            ---------------------------------------------
                                   1999          1998          1997
Dividend yield                      0%            0%            0%

Expected volatility                51%            55%           53%

Risk-free interest rate:
          5 year                     -             -           6.65%
          4 year                     -           5.41%           -
          3 year                  4.69%            -             -
          2 year                     -             -           6.29%
          1 year                     -           5.35%           -


       Stock option/warrant activity is summarized as follows:

<TABLE>
<CAPTION>


                                                    Weighted                       Weighted
                                     Year Ended      Average        Year Ended     Average
                                     January 31,    Exercise        January 31,    Exercise
                                        1999          Price            1998         Price
                                        ----          -----            ----         -----
<S>                                <C>               <C>       <C>                <C>     
Options/warrant outstanding,
  beginning of year                    1,006,111     $  2.52         974,111      $   2.47
Options/warrant granted                        -           -          50,000          3.50
Options/warrant exercised                (71,000)       2.50               -             -
Options/warrant expired                       -           -          (18,000)         2.50
                                   -------------     -------   -------------      --------
Options/warrant outstanding,
  end of year                            935,111     $  2.52       1,006,111      $   2.52
                                   =============     =======   =============      ========

Options/warrant exercisable,
  end of year                            935,111     $  2.52         968,611      $   2.48
                                   =============     =======   =============      ========

Price range per share              $1.60 - $4.50               $1.60 - $4.50
                                   =============               =============
</TABLE>



                                       30
<PAGE>


                                                             Weighted
                                             Year Ended       Average
                                            January 31,      Exercise
                                               1997            Price
                                               ----            -----
Options/warrant outstanding,          
  beginning of year                            314,000         $ 3.46
Options/warrant granted                        685,111           2.02
Options/warrant exercised                      (25,000)          2.50
                                                    -              -
                                         -------------         ------
Options/warrant outstanding,
  end of year                                  974,111         $ 2.47
                                         =============         ======

Options/warrant exercisable,
  end of year                                  739,833         $ 2.21
                                         =============         ======

Price range per share                    $1.60 - $4.50
                                         =============

       The weighted  average  remaining  contractual  life of stock  options and
       warrants outstanding at January 31, 1999 is 6.8 years.

       The weighted  average fair value of options  granted and warrants  issued
       during the years  ended  January  31,  1998 and 1997 was $1.98 and $6.11,
       respectively.  No options or warrants  were issued  during the year ended
       January 31, 1999.





11.    VALUATION ACCOUNTS

       Activity  related to valuation  accounts for the years ended  January 31,
       1999, 1998 and 1997 is as follows:




                                       31
<PAGE>


<TABLE>
<CAPTION>


                                                                                    Additions         Deductions for
                                                                                    charged to      bad debts written
                                                       Balance,                    (deductions        off, inventory      Balance,
                                                       Beginning     Acquired      from) costs        disposed of or       End of
    Valuation Accounts                                  of Year      Companies     and expenses      warranty claims        Year
Allowance for doubtful accounts
<S>                                       <C>         <C>             <C>          <C>              <C>                  <C>       
  and finance charges:                    1/31/99     $ 320,000                    $   (39,931)     $       (12,069)     $ 268,000 
                                          1/31/98       292,000           -             76,780              (48,780)       320,000
                                          1/31/97             -       304,026           10,127              (22,153)       292,000

Excess and obsolete inventory reserve:    1/31/99       557,000           -            (41,000)                 -          516,000
                                          1/31/98       772,500           -           (215,500)                 -          557,000
                                          1/31/97             -        770,000           2,500                  -          772,500
Notes receivable reserve:                 1/31/99       275,000           -                -                    -          275,000
                                          1/31/98       275,000           -                -                    -          275,000
                                          1/31/97             -           -            275,000                  -          275,000
Warranty reserve:                         1/31/99       240,000           -            188,895             (221,395)       207,500
                                          1/31/98       151,000           -            164,000              (75,000)       240,000
                                          1/31/97             -        174,466          42,360              (65,826)       151,000

</TABLE>
     

12.    COMMITMENTS

       The Company has employment agreements with two of its executives. Minimum
       salaries to be paid to these  individuals  for the year ended January 31,
       2000 are $270,000.

       The  Company has various  warehouse  and auto leases  expiring at various
       dates through January 2004.  Future minimum lease payments required under
       these  noncancelable  operating  lease  agreements are  approximately  as
       follows:

        Year Ending
        January 31,
            2000                                $ 158,000
            2001                                  140,000
            2002                                   62,000
            2003                                   58,000
            2004                                   49,000
                                                ---------
                           Total                $ 467,000
                                                =========


       Total rent expense for the years ended  January 31,  1999,  1998 and 1997
       was approximately $181,000, $145,000 and $137,000, respectively.

13.    RELATED PARTY TRANSACTIONS

       At January 31, 1999,  Edison held in its investment  portfolio 304 shares
       of Panavision  Inc., which were purchased in 1998 at a cost of $8,150 and
       have a market value at January 31, 1999 of $3,420.  A member of the Board
       of Directors of Panavision  Inc. is a member of the Board of Directors of
       the  Company.  At January 31,  1999,  Edison also held in its  investment
       portfolio 9,500 shares of Equity One, Inc.,  which were purchased in 1998
       at a cost of  $104,500  and have a market  value at January  31,  1999 of
       $85,500.  A member of the Board of  Directors  of Equity  One,  Inc. is a
       member of the Board of Directors of the Company.


                                       32
<PAGE>


14.    FOREIGN OPERATIONS

       Foreign  operations  information  for the year  ended  January  31,  1999
       follows:

<TABLE>
<CAPTION>


                                              United         United
                                              States         Kingdom       Malaysia      Total

<S>                                        <C>             <C>            <C>          <C>        
Net sales to unaffiliated customers        $22,942,593     $ 1,652,010    $ 455,513    $25,050,116
Operating income (loss)                      4,131,668             280      (86,220)     4,045,728
Identifiable assets                         32,373,533       1,682,731      846,733     34,902,997
Depreciation and amortization                2,005,444          49,677       13,239      2,068,360
Capital expenditures                         3,054,929          20,090        7,706      3,082,725
</TABLE>
     
       Foreign  operations  information  for the year  ended  January  31,  1998
       follows:

<TABLE>
<CAPTION>

                                              United          United
                                              States          Kingdom      Malaysia        Total

<S>                                        <C>             <C>            <C>          <C>        
Net sales to unaffiliated customers        $21,852,948     $ 1,827,477    $ 194,789    $23,875,214
Operating income (loss)                      4,328,227         (51,859)     (86,226)     4,190,142
Identifiable assets                         30,050,025       1,852,144      453,788     32,355,957
Depreciation and amortization                2,196,795          49,737        6,978      2,253,510
Capital expenditures                           412,097          54,919       87,907        554,923
</TABLE>
                                                                          

       Foreign  operations  information  for the year  ended  January  31,  1997
       follows:

<TABLE>
<CAPTION>


                                                    United              United
                                                    States              Kingdom          Malaysia           Total

<S>                                              <C>                 <C>              <C>               <C>        
Net sales to unaffiliated customers              $21,852,948         $ 1,827,477      $ 194,789         $23,875,214
Operating income (loss)                            4,328,227             (51,859)       (86,226)          4,190,142
Identifiable assets                               30,050,025           1,852,144        453,788          32,355,957
Depreciation and amortization                      2,196,795              49,737          6,978           2,253,510
Capital expenditures                                 412,097              54,919         87,907             554,923

</TABLE>
     


                                       33
<PAGE>



15.    SEGMENT INFORMATION


The Company adopted SFAS No. 131,  "Disclosures  about Segments of an Enterprise
and  Related  Information,"  in  1998.  The  Company's  operating  segments  are
organized based on the nature of products and services  provided.  A description
of the nature of the  segment's  operations  and their  accounting  policies are
contained in Note 1. Segment information follows:


<TABLE>
<CAPTION>


                                                                                                  Edison
                                                                 Ultra                            Holding
                                              ConForms            Tech            Gilco           Company           Total
<S>                                        <C>                <C>              <C>              <C>              <C>          
Year ended January 31, 1999
Net sales to unaffiliated customers        $ 19,424,098       $ 3,484,277      $ 2,141,741      $         -      $ 25,050,116 
Operating income (loss)                       3,469,171         1,059,404         (139,172)        (343,675)        4,045,728
Identifiable assets                          23,518,902         5,302,383        1,593,897        4,487,815        34,902,997
Depreciation and amortization                   722,534           317,691           44,240          983,895         2,068,360
Capital expenditures                          2,996,112            72,143           14,470                -         3,082,725


Year ended January 31, 1998
Net sales to unaffiliated customers        $ 18,050,120       $ 3,989,750      $ 1,835,344      $         -      $ 23,875,214 
Operating income (loss)                       3,768,062         1,157,834           97,419         (833,173)        4,190,142
Identifiable assets                          19,648,193         5,742,341        1,077,870        5,887,553        32,355,957
Depreciation and amortization                   653,779           273,123           43,029        1,283,579         2,253,510
Capital expenditures                            342,263           209,039            3,621                -           554,923


Year ended January 31, 1997
Net sales to unaffiliated customers        $  9,285,487       $ 1,882,030      $ 1,549,711        $ 887,112      $ 13,604,340
Operating income (loss)                         691,941           733,550          170,871       (1,064,660)          531,702
Identifiable assets                          19,758,720         5,541,593        1,223,550        7,536,242        34,060,105
Depreciation and amortization                   356,165           134,398           21,468        1,051,643         1,563,674
Capital expenditures                            341,009            70,004            2,936            2,391           416,340


</TABLE>


16.    CONTINGENCIES AND LITIGATION

       The Company is involved in various legal proceedings which have arisen in
       the normal course of business.  Reserves are recorded when the occurrence
       of loss is probable and can be  reasonably  estimated.  In the opinion of
       management,  the  resolution  of  these  contingencies  will  not  have a
       materially adverse effect on the Company's financial condition or results
       of operations.



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