FORM 10--Q

                  SECURITIES AND EXCHANGE COMMISSION

                         Washington, D.C.  20549

(Mark One)

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 1999
                               -------------

                                   OR

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934

For the transition period from           to
                               ---------    ---------

Commission file number 0-14659
                       -------

                            TECHDYNE, INC.
           --------------------------------------------------------
            (Exact name of registrant as specified in its charter)

                  Florida                                59-1709103
---------------------------------------------        -------------------
(State or other jurisdiction of incorporation         (I.R.S. Employer
or organization)                                     Identification No.)

2230 West 77th Street, Hialeah, Florida                     33016
----------------------------------------                  ----------
(Address of principal executive offices)                  (Zip Code)

                             (305) 556-9210
          ------------------------------------------------------
           (Registrant's telephone number, including area code)

                             NOT APPLICABLE
     -----------------------------------------------------------------
      (Former name, former address and former fiscal year, if changed
                           since last report)

     Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15 (d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter
period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.

Yes [x] or No [ ]

Common Stock Outstanding

     Common Stock, $.01 par value - 5,005,167 shares as of July 31, 1999.

<PAGE>

                      TECHDYNE, INC. AND SUBSIDIARIES
                      -------------------------------

                                 INDEX

PART I  --  FINANCIAL INFORMATION
------      ---------------------

     The Consolidated Condensed Statements of Operations (Unaudited) for the
three and six months ended June 30, 1999 and June 30, 1998 include the
accounts of the Registrant and its subsidiaries.

Item 1. Financial Statements
------  --------------------

       (1)  Consolidated Condensed Statements of Operations for the three
            months and six months ended June 30, 1999and June 30, 1998

       (2)  Consolidated Condensed Balance Sheets as of June 30, 1999
            and December 31, 1998.

       (3)  Consolidated Condensed Statements of Cash Flows for the six
            months ended June 30, 1999and June 30, 1998

       (4)  Notes to Consolidated Condensed Financial Statements as of
            June 30, 1999

Item 2. Management's Discussion and Analysis of Financial Condition and
------  ---------------------------------------------------------------
        Results of Operations
        ---------------------

PART II  --  OTHER INFORMATION
-------      -----------------

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

Item 5. Other Information
------  -----------------

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

<PAGE>

                      PART I -- FINANCIAL INFORMATION

Item 1. Financial Statements


                      TECHDYNE, INC. AND SUBSIDIARIES

              CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
                                (UNAUDITED)

<TABLE>
<CAPTION>
                                                Three Months Ended           Six Months Ended
                                                ------------------          ------------------
                                                      June 30,                   June 30,
                                                1999          1998          1999          1998
<S>                                          <C>           <C>           <C>           <C>
Revenues:
  Sales                                      $10,456,793   $11,614,077   $20,291,787   $23,486,098
  Interest and other income                       16,268        40,379        38,389        71,096
                                             -----------   -----------   -----------   -----------
                                              10,473,061    11,654,456    20,330,176    23,557,194

Cost and expenses:
  Cost of goods sold                           9,200,419    10,107,341    18,019,367    20,268,740
  Selling, general and administrative
    expenses                                   1,057,138       834,383     2,052,197     1,860,652
  Interest expense                               177,480       155,338       342,803       320,849
                                             -----------   -----------   -----------   -----------
                                              10,435,037    11,097,062    20,414,367    22,450,241
                                             -----------   ----------    -----------   -----------

Income (loss) before income taxes                 38,024       557,394       (84,191)    1,106,953

Income tax provision                              35,519        11,981        62,432        51,573
                                             -----------   -----------   -----------   -----------
  Net income (loss)                          $     2,505   $   545,413   $  (146,623)  $ 1,055,380
                                             ===========   ===========   ===========   ===========

Earnings (loss) per share:
  Basic                                          $--          $.11         $(.03)         $.21
                                                 ===          ====         =====          ====
  Diluted                                        $--          $.08         $(.03)         $.16
                                                 ===          ====         =====          ====
</TABLE>

See notes to consolidated condensed financial statements.

<PAGE>

                      TECHDYNE, INC. AND SUBSIDIARIES

                   CONSOLIDATED CONDENSED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                           June 30,    December 31,
                                                                             1999         1998(A)
                                                                             ----         ------
                                                                         (Unaudited)
                        Assets
<S>                                                                      <C>           <C>
Current assets:
  Cash and cash equivalents                                              $   839,281   $ 1,659,737
  Accounts receivable, less allowances of $49,000 at
    June 30, 1999 and $47,000 at December 31, 1998                         6,368,466     5,769,868
  Inventories, less allowances for obsolescence of $634,000
    at June 30, 1999 and $544,000 at December 31, 1998                     9,318,560     7,874,500
  Prepaid expenses and other current assets                                  236,582       165,925
  Deferred tax asset                                                         466,259       466,259
                                                                         -----------   -----------
          Total current assets                                            17,229,148    15,936,289

Property and equipment:
  Land and improvements                                                      189,600       199,200
  Buildings and building improvements                                        732,134       769,204
  Machinery and equipment                                                  7,377,937     6,846,863
  Tools and dies                                                             837,312       844,988
  Leasehold improvements                                                     386,005       308,074
                                                                         -----------   -----------
                                                                           9,522,988     8,968,329
  Less accumulated depreciation and amortization                           4,358,925     3,892,293
                                                                         -----------   -----------
                                                                           5,164,063     5,076,036
Deferred expenses and other assets                                           118,704       122,578
Costs in excess of net tangible assets acquired, less
     accumulated amortization of $252,000 at June 30,
     1999 and $192,000 at December 31, 1998                                2,912,496     2,682,938
                                                                         -----------   -----------
                                                                         $25,424,411   $23,817,841
                                                                         ===========   ===========

               Liabilities and Stockholders' Equity
Current liabilities:
  Short-term bank borrowings                                             $ 1,307,732   $   962,407
  Accounts payable                                                         4,748,965     3,233,202
  Accrued expenses                                                         1,610,832     1,534,785
  Current portion of long-term debt                                        2,480,643       764,550
  Income taxes payable                                                        80,650       120,027
                                                                         -----------   -----------
          Total current liabilities                                       10,228,822     6,614,971
Deferred gain on sale of real estate                                         161,047       161,047
Long-term debt, less current portion                                       2,723,372     4,450,578
Advances from parent                                                       3,104,717     3,130,588

Commitments and contingencies

Stockholders' equity:
  Common stock, $.01 par value, authorized 10,000,000 shares;
    issued and outstanding 5,300,167 shares at June 30, 1999
    and 5,250,167 shares at December 31, 1998                                 53,001        52,501
  Capital in excess of par value                                          11,188,791    11,139,291
  Accumulated deficit                                                       (454,559)     (307,936)
  Accumulated other comprehensive loss                                      (139,719)      (31,638)
  Notes receivable from options exercised                                   (163,350)     (113,850)
  Advance on subsidiary acquisition price guarantee                       (1,277,711)   (1,277,711)
                                                                         -----------   -----------
          Total stockholders' equity                                       9,206,453     9,460,657
                                                                         -----------   -----------
                                                                         $25,424,411   $23,817,841
                                                                         ===========   ===========
</TABLE>

(A) Reference is made to the Company's Annual Report on Form 10-K for the
    year ended December 31, 1998 filed with the Securities and Exchange
    Commission in March 1999.

See notes to consolidated condensed financial statements.

<PAGE>

                      TECHDYNE, INC. AND SUBSIDIARIES

              CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
                               (UNAUDITED)

<TABLE>
<CAPTION>
                                                                              Six Months Ended
                                                                                   June 30,
                                                                         -------------------------
                                                                             1999          1998
                                                                             ----          ----
<S>                                                                      <C>           <C>
Operating activities:
  Net (loss) income                                                      $  (146,623)  $ 1,055,380
  Adjustments to reconcile net (loss) income to net cash
         (used in) provided by operating activities:
     Depreciation                                                            570,233       488,353
     Amortization                                                             65,660        53,458
     Provision for inventory obsolescence                                    167,072       235,393
     Bad debt expense                                                             --           551
     Consultant stock option expense                                              --         4,635
     Increase (decrease) relating to operating activities from:
       Accounts receivable                                                  (621,675)       (7,201)
       Inventories                                                        (1,632,393)     (451,396)
       Prepaid expenses and other current assets                             (77,004)       55,213
       Accounts payable                                                    1,521,487      (113,254)
       Accrued expenses                                                       87,656        97,602
       Income taxes payable                                                  (39,377)       62,285
                                                                         -----------   -----------
          Net cash (used in) provided by operating activities               (104,964)    1,481,019

Investing activities:
  Additions to property and equipment, net of minor disposals               (724,080)     (302,276)
  Subsidiary acquisition payments                                           (289,531)     (153,818)
  Deferred expenses and other assets                                          (2,125)       (6,490)
                                                                         -----------   -----------
          Net cash used in investing activities                           (1,015,736)     (462,584)

Financing activities:
  Proceeds from long-term borrowings                                         375,000
  Short-term line of credit net borrowings (payments)                        345,325      (548,698)
  Payments on long-term debt                                                (360,284)     (425,882)
  Exercise of stock options and warrants                                         500         1,150
  (Decrease) increase in advances from parent                                (25,871)      162,789
  Deferred financing costs                                                      (451)          169
                                                                         -----------   -----------
          Net cash provided by (used in) financing activities                334,219      (810,472)

Effect of exchange rate fluctuations on cash                                 (33,975)        3,276
                                                                         -----------   -----------

(Decrease) increase in cash and cash equivalents                            (820,456)      211,239

Cash and cash equivalents at beginning of year                             1,659,737     1,451,564
                                                                         -----------   -----------

Cash and cash equivalents at end of period                               $   839,281   $ 1,662,803
                                                                         ===========   ===========
</TABLE>

See notes to consolidated condensed financial statements.

<PAGE>

                       TECHDYNE, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
                                June 30, 1999
                                 (Unaudited)

NOTE 1--Summary of Significant Accounting Policies

Consolidation

     The consolidated financial statements include the accounts of Techdyne,
Inc. ("Techdyne") and its subsidiaries, including Lytton Incorporated
("Lytton"), Techdyne (Europe) Limited ("Techdyne (Europe)"), and Techdyne
(Livingston) Limited which is a subsidiary of Techdyne (Europe), collectively
referred to as the "Company."  All material intercompany accounts and
transactions have been eliminated in consolidation.  The Company at June 30,
1999 was a 60.9% owned subsidiary and at July 31, 1999 was a 64.5% owned
subsidiary of Medicore, Inc. (the "Parent").  See Notes 5 and 9.

Major Customers

     A majority of the Company's sales are to certain major customers.  The
loss of or substantially reduced sales to any of these customers would have
an adverse effect on the Company's operations if such sales were not replaced.

     A significant customer of the Company, which accounted for 4% of sales
for the six months ended June 30, 1999 and 9% of sales for the same period
of the preceding year has been slow in paying amounts due to the Company.
The Company has substantial receivables and inventory relating to a sales
contract with the customer.  The Company anticipates an ongoing business
relationship with the customer and believes that the receivables and inven-
tory relating to the customer are recoverable.  If any significant amount
of receivables and inventory were not recoverable, this could have a
material adverse effect on the Company's financial position and results of
operations.

Inventories

     Inventories, which consist primarily of raw materials used in the pro-
duction of electronic components, are valued at the lower of cost (first-in,
first-out method) or market value.  The cost of finished goods and work in
process consists of direct materials, direct labor and an appropriate portion
of fixed and variable manufacturing overhead.  Inventories are comprised of
following:


                                               June 30,    December 31,
                                                1999          1998
                                                ----          ----
     Finished goods                          $   601,354   $   794,297
     Work in process                           2,333,562     1,845,954
     Raw materials and supplies                6,383,644     5,234,249
                                             -----------   -----------
                                             $ 9,318,560   $ 7,874,500
                                             ===========   ===========

Accrued Expenses and Other Current Liabilities

     Accrued expenses and other current liabilities is comprised as follows:


                                               June 30,    December 31,
                                                1999          1998
                                                ----          ----
     Accrued compensation                    $   558,693   $   400,680
     Other                                     1,052,139     1,134,105
                                             -----------   -----------
                                             $ 1,610,832   $ 1,534,785
                                             ===========   ===========

<PAGE>

                       TECHDYNE, INC. AND SUBSIDIARIES

        NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS--(Continued)
                                June 30, 1999
                                 (Unaudited)

NOTE 1--Summary of Significant Accounting Policies--(Continued)

Earnings per Share

     Diluted earnings per share gives effect to potential common shares
that were dilutive and outstanding during the period, such as stock options
and warrants using the treasury stock method and average market price,
shares assumed to be converted relating to the convertible promissory note
to the Company's Parent (with earnings adjusted for interest expense related
to the convertible promissory note which is assumed to be converted) and
contingent shares for the stock price guarantee for the acquisition of
Lytton.  No potentially dilutive securities were included in the diluted
earnings per share computation for the six months ended June 30, 1999, as
a result of exercise prices and the net loss, and to include them would be
anti-dilutive.

Following is a reconciliation of amounts used in the basic and diluted
computations:

<TABLE>
<CAPTION>
                                                Three Months Ended           Six Months Ended
                                                ------------------          ------------------
                                                      June 30,                   June 30,
                                                1999          1998          1999          1998
<S>                                          <C>           <C>           <C>           <C>
Net income (loss) - numerator basic
    computation                              $     2,505   $   545,413   $  (146,623)  $ 1,055,380
Effect of dilutive securities:
Interest adjustment on convertible note              ---        33,364           ---        66,261
                                             -----------   -----------   -----------   -----------
Net income (loss), as adjusted for
    assumed conversion - numerator
    diluted computation                      $     2,505   $   578,777   $  (146,623)  $ 1,121,641
                                             ===========   ===========   ===========   ===========

Weighted average shares - denominator
    basic computation                          5,278,738     5,135,167     5,264,532     5,135,167
Effect of dilutive securities:
Stock options                                     76,363       323,846           ---       326,377
Contingent stock - acquisition                   300,000       233,333           ---       233,333
Convertible note                                     ---     1,337,910           ---     1,328,544
                                             -----------   -----------   -----------   -----------
Weighted average shares, as
    adjusted - denominator                     5,655,101     7,030,256     5,264,532     7,023,421
                                             ===========   ===========   ===========   ===========

Earnings (loss) per share:
   Basic                                        $ --           $.11         $(.03)        $.21
                                                ====           ====         =====         ====
   Diluted                                      $ --           $.08         $(.03)        $.16
                                                ====           ====         =====         ====
</TABLE>

     The Company has various potentially dilutive securities, including
stock options, contingent shares and shares from assumed conversion of
convertible debt.  See Notes 5,7,8 and 9.

Comprehensive Income

     In 1998 the Company adopted Financial Accounting Standards Board State-
ment No. 130, "Reporting Comprehensive Income" (FAS 130).  This statement
establishes rules for the reporting of comprehensive income (loss) and its
components.  Comprehensive income (loss) consists of net income (loss) and
foreign currency translation adjustments.

<PAGE>

                       TECHDYNE, INC. AND SUBSIDIARIES

        NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS--(Continued)
                                June 30, 1999
                                 (Unaudited)

NOTE 1--Summary of Significant Accounting Policies--(Continued)

     Below is a detail of comprehensive (loss) income for the three months
and six months ended June 30, 1999 and June 30, 1998:

<TABLE>
<CAPTION>
                                                Three Months Ended           Six Months Ended
                                                ------------------          ------------------
                                                      June 30,                   June 30,
                                                1999          1998          1999          1998
     <S>                                     <C>           <C>           <C>           <C>
     Net income (loss)                       $     2,505   $   545,413   $  (146,623)  $ 1,055,380
     Other comprehensive (loss) income:
     Foreign currency translation                (38,696)       (1,702)     (108,081)       32,037
                                             -----------   -----------   -----------   -----------
     Comprehensive (loss) income             $   (36,191)  $   543,711   $  (254,704)  $ 1,087,417
                                             ===========   ===========   ===========   ===========
</TABLE>


New Pronouncements

     In June, 1998, the Financial Accounting Standards Board issued
Financial Accounting Standards Board Statement No. 133, "Accounting for
Derivative Instruments and Hedging Activities" (FAS 133).  FAS 133 is
effective for fiscal years beginning after June 15, 2000.  FAS 133
establishes accounting and reporting standards for derivative instruments
and for hedging activities and requires, among other things, that all
derivatives be recognized as either assets or liabilities in the statement
of financial position and that those instruments be measured at fair value.
The Company is in the process of determining the impact that the adoption
of FAS 133 will have on its consolidated financial statements.

Reclassifications

     Certain reclassifications have been made to the 1998 financial state-
ments to conform to the 1999 presentation.

NOTE 2--Interim Adjustments

     The financial summaries for the three months and six months ended June
30, 1999 and June 30, 1998 are unaudited and include, in the opinion of
management of the Company, all adjustments (consisting of normal recurring
accruals) necessary to present fairly the earnings for such periods.
Operating results for the three months and six months ended June 30, 1999
are not necessarily indicative of the results that may be expected for the
entire year ending December 31, 1999.

     While the Company believes that the disclosures presented are adequate
to make the information not misleading, it is suggested that these Consoli-
dated Condensed Financial Statements be read in conjunction with the
financial statements and notes included in the Company's latest annual
report for the year ended December 31, 1998.

NOTE 3--Long-term Debt

     The Company's $1,600,000 line of credit effective December 29, 1997 was
fully drawn down with an outstanding balance of $1,600,000 at June 30, 1999
and December 31, 1998.  This line matures May 1, 2000 and has monthly
payments of interest at prime.  The commercial term loan effective December
29, 1997 with an initial principal balance of $1,500,000 had an outstanding
balance of $1,050,000 at June 30, 1999 and $1,200,000 at December 31, 1998,
matures December 15, 2002 with monthly principal payments of $25,000 plus
interest.  In connection with the term loan, the Company entered into an
interest rate swap agreement with the bank to manage the

<PAGE>

                       TECHDYNE, INC. AND SUBSIDIARIES

        NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS--(Continued)
                                June 30, 1999
                                 (Unaudited)

NOTE 3--Long-term Debt--(Continued)

Company's exposure to interest rates by effectively converting a variable
rate obligation with an interest rate of LIBOR plus 2.25% to a fixed rate
of 8.60%.

     The bank also extended two commercial term loans to the Company in
February 1996, one for $712,500 for five years expiring on February 7, 2001
at an annual rate of interest equal to 8.28% with a monthly payment of prin-
cipal and interest of $6,925 based on a 15-year amortization schedule with
the unpaid principal and accrued interest due on the expiration date.  This
term loan had an outstanding balance of approximately $621,000 at June 30,
1999 and $636,000 at December 31, 1998 and is secured by a mortgage on
properties in Hialeah, Florida owned by the Company's Parent.  The second
commercial term loan was for the principal amount of $200,000 for a period
of five years bearing interest at a per annum rate of 1.25% over the bank's
prime rate and requiring monthly principal payments with accrued interest
of $3,333 through expiration on February 7, 2001.  This $200,000 term loan
which had a balance of approximately $67,000 at June 30, 1999 and $87,000
at December 31, 1998 is secured by all of Techdyne's tangible personal
property, goods and equipment, and all cash or noncash proceeds of such
collateral.

     The Parent has unconditionally guaranteed the payment and performance
by the Company of the revolving loan and the three commercial term loans and
has subordinated the Company's intercompany indebtedness to the Parent to the
bank's position.

     Lytton had a $1,500,000 revolving bank line of credit requiring monthly
interest payments at prime plus 1/2% maturing June 30, 1999 which was
increased to $3,000,000 and extended to June 30, 2000. The interest rate on
this loan was 8.25% at June 30, 1999 and December 31, 1998.  There was an
outstanding balance on this loan of $1,308,000 as of June 30, 1999 with
$962,000 outstanding at December 31, 1998.  Lytton had a $1,000,000 in-
stallment loan with the same bank maturing August 1, 2002, at an annual
rate of 9% until July 1999, with monthly payments of $16,667 plus interest,
at which time Lytton was to have an option to convert the note to a variable
rate.  Lytton replaced this loan at June 30, 1999 with a $1,400,000 in-
stallment loan with monthly payment of $23,333 payable in 60 monthly
installments commencing August 1, 1999 with the final installment due June
30, 2004.  The balance outstanding on this loan was approximately $633,000
at June 30, 1999 and $733,000 as of December 31, 1998.  Lytton also has a
$500,000 equipment loan agreement with the same bank payable through June
30, 2004 which replaced an agreement of the same amount which had a maturity
of August 1, 2003, with the interest rate at prime plus 1%. This loan had an
outstanding balance of $375,000 at June 30, 1999 with no outstanding balance
at December 31, 1998.  All of these bank loans are secured by the business
assets of Lytton.

     The prime rate was 7.75% as of June 30, 1999 and December 31, 1998.

     Lytton conducts a portion of its operations with equipment acquired
under equipment financing obligations which extend through July 1999 with
interest rates ranging from 8.55% to 10.09%.  The remaining principal
balance under these financing obligations amounted to $76,000 at June 30,
1999 and $112,000 at December 31, 1998.  Lytton has an equipment loan at
an annual interest rate of 5.5% maturing in April 2001 with monthly payments
of principal and interest of $4,298.  This loan had a balance of approxi-
mately $135,000 at June 30, 1999 and $157,000 at December 31, 1998 and is
secured by equipment.

     Techdyne (Europe) has a mortgage on its facility which had a principal
balance with a U.S. dollar equivalency of $502,000 at June 30, 1999 and
$545,000 at December 31, 1998.

     Interest payments on long-term debt amounted to approximately $126,000
and $252,000 for the three months and six months ended June 30, 1999 and
$124,000 and $267,000 for the same period of the preceding year.

<PAGE>

                       TECHDYNE, INC. AND SUBSIDIARIES

        NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS--(Continued)
                                June 30, 1999
                                 (Unaudited)

NOTE 4--Income Taxes

     The Company files separate federal and state income tax returns from
its Parent, with its income tax liability reflected on a separate return
basis.

     Deferred income taxes reflect the net tax effect of temporary dif-
ferences between the carrying amounts of assets and liabilities for
financial reporting purposes and the amounts used for income tax purposes.
For financial reporting purposes a valuation allowance has been recognized
to offset a portion of the deferred tax assets.

     The Company had domestic income tax expense of approximately $35,000
and $62,000 for the three months and six months ended June 30, 1999 and
$70,000 and $115,000 for the same periods of the preceding year.

     Techdyne (Europe) had an income tax benefit of approximately $58,000
and $63,000 for the three months and six months ended June 30, 1998 with
no such benefit or provision for the same periods of 1999.

     Income tax payments amounted to $100,000 and $102,000 for the three
months and six months ended June 30, 1999 and $16,000 and $54,000 for the
same periods of the preceding year.

NOTE 5--Transactions with Parent

     The Parent provides certain administrative services to the Company
including providing office space and general accounting assistance.  Effec-
tive October 1, 1996, the services provided to the Company by the Parent
were formalized under a service agreement for $408,000 per year.  The
amount of expenses covered under the service agreement totaled $102,000
and $204,000 for the three months and six months ended June 30, 1999 and
for the same periods of the preceding year.

     The Company's demand convertible promissory note payable to the Parent
which bears interest at 5.7% had a balance including accrued interest of
approximately $2,496,000 at June 30, 1999 and $2,427,000 at December 31,
1998, and may be converted into common stock of the Company at the option
of the Parent at a conversion price of $1.75 per share.  Advances from the
Parent on the balance sheet includes the convertible note balance and an
advance payable to the Parent of approximately $609,000 at June 30, 1999
and $704,000 at December 31, 1998 with interest at 5.7%.  Interest on the
advances amounted to $44,000 and $89,000 for the three months and six
months ended June 30, 1999 and $35,000 and $69,000 for the same periods of
the preceding year and is included in the net balance due the Parent.  The
Parent has agreed not to require repayment of the intercompany advances
prior to July 1, 2000 and, therefore, the advances have been classified as
long-term at June 30, 1999.

     The Company has manufactured certain products for the Parent.  Sales of
the products were $23,000 for the six months ended June 30, 1999 with no
such sales during the second quarter of 1999.  These sales amounted to
$48,000 and $99,000 for the three months and six months ended June 30,
1998.

NOTE 6--Commitments and Contingencies

     Lytton sponsors a 401(k) Profit Sharing Plan covering substantially all
of its employees.  The Company adopted this plan as a participating employer
effective July 1, 1998.  The discretionary profit sharing and matching
expense, including that of the Company and Lytton for the six months ended
June 30, 1999 amounted to approximately $39,000, with such expense amounting
to approximately $21,000 and including only Lytton for the six months ended
June 30, 1998.

<PAGE>

                       TECHDYNE, INC. AND SUBSIDIARIES

        NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS--(Continued)
                                June 30, 1999
                                 (Unaudited)

NOTE 6--Commitments and Contingencies--(Continued)

     Lytton has a deferred compensation agreement with its former President.
The agreement calls for monthly payments of $8,339 provided that Lytton's
cash flow is adequate to cover these payments with interest to be calculated
on any unpaid balance as of August 1, 1999.  During the six months ended
June 30, 1999, a total of $50,000 was paid under this agreement, leaving an
unpaid balance of approximately $8,000 as of June 30, 1999.

     Lytton leases its operating facilities from an entity owned by the
former President of Lytton and his wife, the former owner.  The lease
expires July 31, 2002 and requires annual lease payments of approximately
$218,000, adjusted each year based upon the Consumer Price Index.  During
the six months ended June 30, 1999, $109,000 was paid under the lease
compared to $107,000 paid for the same period last year.

     The Company entered into a one year agreement for investor relations
and corporate communications services as of April 1, 1999 with a monthly
fee of $3,500.  The agreement provides for issuance of up to 50,000 stock
options if the consultant satisfies various performance criteria and may
be cancelled upon 15 days written notice by either party.

NOTE 7--Stock Options

     In May 1994, the Company adopted a stock option plan for up to
250,000 options.  Pursuant to this plan, in May 1994, the board of
directors granted 227,500 options to certain of its officers, directors
and employees.  These options were exercisable at $1 per share through May
24, 1999.  On June 30, 1998, 115,000 of these options were exercised and on
May 10, 1999, 50,000 of the remaining options were exercised.  The Company
received cash payment of the par value and the balance in three year promis-
sory notes, presented in the Stockholders' Equity Section of the balance
sheet with interest at 5.16% for the June 1998 exercise and 4.49% for the
May 1999 exercises.

     On February 27, 1995 the Company granted stock options, not part of the
1994 Plan, to directors of Techdyne and its subsidiaries for 142,500 shares
exercisable at $1.75 per share through February 26, 2000.  In April 1995, the
Company granted a stock option for 10,000 shares, not part of the 1994 Plan,
to its general counsel at the same price and terms as the directors' options.

     In June 1997, the Company adopted a Stock Option Plan for up to 500,000
options, and pursuant to the plan the board granted 375,000 options exercis-
able for five years through June 22, 2002 at $3.25 per share.

     As part of the consideration pursuant to an agreement for investor
relations and corporate communications services, the Company granted options
for 25,000 shares of its common stock exercisable for three years through May
14, 2001 at $4.25 per share with the options to vest quarterly on the basis
of 25% at the end of each quarter commencing June 30, 1998.  6,250 options
vested during the quarter ended June 30, 1998 with no additional options to
vest due to cancellation of this agreement in August 1998.  Pursuant to FAS
123, the Company recorded $13,000 expense for options vesting under this
agreement.

     The Company entered into a consulting agreement on July 1, 1999 for
financial advisory services with the agreement to end on September 15, 2000.
As compensation, the consultant received non-qualified stock options to
purchase 100,000 shares of the Company's common stock exercisable at $3.50
per share that will expire on September 15, 2000.

<PAGE>

                       TECHDYNE, INC. AND SUBSIDIARIES

        NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS--(Continued)
                                June 30, 1999
                                 (Unaudited)

NOTE 8--Common Stock

     Pursuant to a 1995 public offering, 1,000,000 shares of common stock
and 1,000,000 redeemable common stock purchase warrants were issued.  The
warrants provided for the purchase of one common share each.  In February
1999, the Company reduced the exercise price to $4.00 and extended the
exercise period of the remaining approximately 959,000 outstanding warrants
to May 17, 1999 at which time the warrants expired.  The underwriter
received warrants to purchase 100,000 shares of common stock and/or 100,000
warrants exercisable through September 12, 2000 at $6.60 per share of common
stock and $.25 per warrant with each warrant exercisable into common stock at
$8.25 per share.

NOTE 9--Acquisition

     On July 31, 1997, the Company acquired Lytton, which manufactures and
assembles printed circuit boards and other electronic products, for
$2,500,000 cash, and issuance of 300,000 shares of the Company's common
stock.  The Company guaranteed that the seller would realize a minimum of
$2,400,000 from the sale of these shares of common stock based on Lytton
having achieved certain earnings objectives resulting in an increase of
$400,000 in the valuation of $2,000,000 originally recorded for these
securities. The total purchase price in excess of the fair value of net
assets acquired, which originally amounted to approximately $2,230,000, is
being amortized over 25 years.  Additional contingent consideration is due
if Lytton achieves pre-defined sales levels.  Additional consideration of
approximately $290,000 and $154,000 was paid in April 1999 and April 1998,
respectively, based on sales levels with the Stock Purchase Agreement pro-
viding for a possible additional sales level incentive for a specified one
year period.  As the contingencies are resolved, if additional consideration
is due, the then current fair value of the consideration will be recorded as
goodwill, which will be amortized over the remainder of the initial 25 year
life.

     The terms of the Guaranty in the Stock Purchase Agreement were modified
in June, 1998 by the Company and the seller ("Modified Guaranty").  The
modified terms provided that the seller would sell an amount of common stock
which would provide $1,300,000 gross proceeds, and the Company guaranteed
that, to the extent that the seller has less than 150,000 shares of the
Company's common stock remaining, the Company would issue additional shares
to the seller.  In July 1998, the Company advanced the seller approximately
$1,278,000 ("Advance") toward the $1,300,000 from the sale of the Company's
common in addition to the seller having sold 5,000 shares of common stock in
July, 1998.  Proceeds from the sale of the Company's common stock by the
seller, up to 195,000 shares, were to repay the Advance and to the extent
proceeds from the sale of these shares were insufficient to pay the advance,
the balance of the Advance would be forgiven.  The Advance has been presented
in the Stockholder's Equity section of the balance sheet.  The Company
guaranteed the seller aggregate proceeds of no less than $1,100,000 from
the sale of the remaining common stock if sold on or prior to July 31, 1999.

     In July 1999, the Company forgave the Advance to the seller and issued
payment of $1,100,000 to the seller, which together with the proceeds
realized by the seller from the sale of stock in July 1998 satisfied the
Company's remaining obligation under the $2,400,000 guarantee.  The remaining
295,000 shares of common stock held by the seller as security for the
remaining $2,378,000 guarantee were returned to the Company and will be
reflected as treasury shares.

<PAGE>

Item 2. Management's Discussion and Analysis of Financial Condition and
------  ---------------------------------------------------------------
        Results of Operations
        ---------------------

Forward-Looking Information

     The statements contained in this Quarterly Report on Form 10-Q that are
not historical are forward-looking statements within the meaning of Section
27A of the Securities Act of 1933 and Section 21E of the Securities Exchange
Act of the 1934.  The Private Securities Litigation Reform Act of 1995 (the
"Reform Act") contains certain safe harbors regarding forward-looking
statements.  Certain of the forward-looking statements include management's
expectations, intentions and beliefs with respect to the growth of the
Company, the nature of the electronics industry in which it is engaged as
a manufacturer, the Company's business strategies and plans for future
operations, its needs for capital expenditures, capital resources, liquidity
and operating results, and similar expressions concerning matters that are
not historical facts.  Such forward-looking statements are subject to risks
and uncertainties that could cause actual results to materially differ from
those expressed in the statements.  All forward-looking statements included
in this document are based on information available to the Company on the
date hereof, and the Company assumes no obligation to update any such
forward-looking statement.  The following cautionary statements are being
made pursuant to the provisions of the Reform Act with the intention of the
Company obtaining the benefits of the safe harbor provisions of the Reform
Act.  Among the factors that could cause actual results to differ materially
are the factors detailed in the risks discussed in the "Risk Factors" section
included in the Company's Registration Statements, as filed with the
Securities and Exchange Commission ("Commission") Form SB-2 (effective
September 13, 1995), and Form S-3 (effective November 11, 1996) and as
amended or supplemented.

     The Company has continued to depend upon a relatively small number of
customers for a significant percentage of its net revenue.  Significant
reductions in sales to any of the Company's large customers would have a
material adverse effect on the Company's results of operations.  The level
and timing of orders placed by a customer vary due to, among other variables,
attempts to balance inventory, design changes, demand for products, competi-
tion and general economic conditions.  Termination of manufacturing
relationships or changes, reductions or delays in orders as had occurred in
the past, could have an adverse effect on the Company's results of operations
or financial condition.

     The industry segments served by the Company and the electronics industry
as a whole, are subject to rapid technological change and product obso-
lescence.  Discontinuance or modification of products containing
components manufactured by the Company could adversely affect the
Company's results of operations.  The electronics industry is also subject
to economic cycles and has in the past experienced, and is likely in the
future to experience, recessionary periods.  A general recession in the
electronics industry could have a material adverse effect on Techdyne's
business, financial condition and results of operations.

     Due to the Company's utilization of just-in-time inventory techniques,
the timely availability of many components is dependent on the Company's
ability to continuously develop accurate forecasts of customer volume
requirements.  Component shortages could result in manufacturing and
shipping delays or increased component prices which could have a material
adverse effect on the Company's results of operations.  It is important for
the Company, and there are significant risks involved, to efficiently
manage inventory, proper timing of expenditures and allocations of physical
and personnel resources in anticipation of future sales, the evaluation of
economic conditions in the electronics industry and the mix of products,
whether PCBs, wire harnesses, cables or turnkey products, for manufacture.

     Although management believes that the Company's operations utilize
the assembly and testing technologies and equipment currently required by
the Company's customers, there can be no assurance that the Company's
process development efforts will be successful or that the emergence of
new technologies, industry standards or customer requirements will not
render the Company's technology, equipment or processes obsolete or
noncompetitive.  In addition, to the extent that the Company determines
that new assembly and testing technologies and equipment are required to
remain competitive, the acquisition and implementation of such technologies
and equipment are likely to require significant capital investment.

     The Company's results of operations are also affected by other factors,
including price competition, the level and timing of customer orders,
fluctuations in material costs, the overhead efficiencies achieved by the
Company in managing the costs of its operations, the Company's experience
in manufacturing a particular product, the timing of expenditures in
anticipation of increased orders, and selling, general and administrative
expenses.  Accordingly, gross margins and operating income margins have
generally improved during periods of high volume and high capacity utili-
zation.  The Company generally has idle capacity and reduced operating
margins during periods of lower-volume production.

<PAGE>

Forward-Looking Information (continued)

     The Company competes with much larger electronic manufacturing entities
for expansion opportunities.  Any such transactions may result in potentially
dilutive issuance of equity securities, the incurrence of debt and amortiza-
tion expenses related to goodwill and other intangible assets, and other
costs and expenses, all of which could materially adversely affect the
Company's financial results.  Such transactions also involve numerous
business risks, including difficulties in successfully integrating acquired
operations, technologies and products or formalizing anticipated synergies,
and the diversion of management's attention from other business concerns.

Year 2000 Readiness

     The Year 2000 computer information processing challenge associated with
the upcoming millennium change concerns the ability of computerized informa-
tion systems to properly recognize date sensitive information, with which
many companies, public and private, are faced to ensure continued proper
operations and reporting of financial condition.  Failure to correct and
comply with the Year 2000 change may cause systems that cannot recognize the
new date and millenium information to generate erroneous data or to fail to
operate.  Management is fully aware of the Year 2000 issues, has made its
assessments, has evaluated its computerized systems and equipment to insure
each component operates properly with the date advanced to the year 2000,
and has communicated with its major vendors, and has substantially made the
operations of Techdyne Year 2000 compliant.

     In 1997 we commenced upgrading our operations software program by
acquiring a new Visual Manufacturing software package.  To a lesser extent
our Parent also acquired certain hardware and software of the Visual
Manufacturing system.  We have substantially completed integrating this
new software system into all of our facilities.  Our European facility went
on line July 1, 1999, and our Lytton subsidiary, although its existing ERP
system is Year 2000 compliant, is in the process of installing the Visual
Manufacturing software system, which should be operational for that sub-
sidiary in early September, 1999.  This new system has greatly enhanced our
ERP system, essential to bids for new business, production scheduling,
inventory and information technology and overall operations.  We believe
this new system is providing us with leverage in material pricing, produc-
tion, timely-delivery and thereby enabling us to be more competitive in
bidding for manufacturing business.  This Visual Manufacturing system also
enables us to better track actual costs against our quotes, thereby allowing
us to more effectively control costs and manage operating margins.  The
system has been pre-tested and guaranteed by the manufacturer to be Year
2000 compliant.  The Visual Manufacturing system also provides bookkeeping,
accounting and financial recording and information functions for Techdyne,
its Parent and Dialysis Corporation of America, a 68% owned public subsidiary
of the Parent.  The costs for this new software program for our four domestic
and one European facilities has been approximately $590,000.  We have an
ongoing consulting, training and servicing arrangement with the system's
manufacturer for $25,000 per year.

     With respect to non-information technology systems which typically
include embedded technology such as microcontrollers, the major equipment
used in our manufacturing operations is not date sensitive and should not
pose any threat of system breakdown.  All date-sensitive manufacturing
equipment has been tested and is compliant.  Personal computer hardware
and software systems have been checked and have been determined to be
Year 2000 compliant.

     We have communicated with our key vendors, customers and other third
parties with whom our operations are essential to inquire of their assessment
of their Year 2000 issues and actions being taken to resolve those issues.
We have received a significant response rate for which most have given
written assurance that they are Year 2000 compliant, with the balance
assuring us they will be Year 2000 compliant before the millenium change.
To the extent such third parties are potentially adversely affected by the
Year 2000 issues, and such is not timely and properly resolved by such
persons, this could disrupt our operations to the extent that we will have
to find alternative vendors or customers that have resolved their Year 2000
issues.

     No assurance can be given that our new Visual Manufacturing software
program will be successful in its anticipated operational benefits as
assessed above or that our key vendors and customers will have successful
conversion programs, and that any such failures, whether relating to the
manufacturing operational efficiencies or the Year 2000 issue, will not
have a material adverse effect on our business, results of operations or
financial condition.  Based upon our current assessments, but subject to
the uncertainties discussed below, we do not believe Techdyne has any
material exposure to significant business interruptions as a result of the
Year 2000 issues, or that the cost of any necessary remediation will have a
material adverse effect on our business, financial condition or results of
operations.

<PAGE>

Year 2000 Readiness (continued)

     One of the more significant Year 2000 issues relates to the readiness
of our suppliers.  Most of our products are manufactured to customer
specifications, requiring specialized tooling as well as customer directed
supplies and suppliers.  Any Year 2000 problems with such suppliers could
adversely affect our production of these specific products.  However, this
would only impact a limited range of products, since we manufacture over
850 products for our 100 customers.  For any significant worse case scenario,
such supplier failure would have to be widespread which would also impact
many of our competitors.  This would seem remote based upon responses we
have had from our suppliers.  Assuming a worse case scenario that our
critical suppliers have a millenium problem and limit, delay or are unable
to deliver supplies, we are identifying other sources of supplies and, if
necessary, will seek customer approval to purchase from these alternate
sources, as well as request our major suppliers to carry more inventory
earmarked for us, and maintain specific contacts with those suppliers.

     Another area that could significantly impact our operations that relates
to third-party providers are the utility companies providing necessary power
for our manufacturing operations.  These providers and services are beyond
our control, and we do not have a separate generator for electricity.  Should
any of these utilities fail to provide services, that contingency would
seriously adversely impact our operations in such affected areas.  Our
continuing plans to reduce the impact of such utility shortages or outages
includes notification to our utility companies of our manufacturing locations
and schedules, and notification to each of our landlords to assure access to
the facility for our staff and key service providers.

     We may experience material unanticipated negative consequences beginning
in the Year 2000 due to Year 2000 problems that have gone undetected.  Al-
though we believe our assessment and implementation of our Year 2000 issues
have been satisfactorily completed, there are many uncertainties involved,
which include two primary areas.  One is our ability to deal with Year 2000
contingencies that may arise that we were unaware of, and second is how third
parties with whom we deal have dealt with the Year 2000 issue.  Accordingly,
the results of our Year 2000 program and the extent of any impact on our
results of operations could vary materially from what we have disclosed.  The
complexity of the Year 2000 issues does not allow us the ability to predict
with any significant accuracy or to qualify its impact upon us for the fol-
lowing reasons:

     o  third party systems, whether suppliers, utilities and others, are
        beyond our control

     o  complexity of testing interconnected systems and networks that depend
        on third-party systems

     o  uncertainty of costs we might incur as a result of Year 2000 failures
        that occur despite implementation of our program to deal with the
        issues

Results of Operations

     Consolidated revenues decreased approximately $1,181,000 (10%) and
$3,227,000 (14%) for the three months and six months ended June 30, 1999
compared to the preceding year.  There was a decrease in domestic sales of
$823,000 (8%) and $2,008,000 (10%) and a decrease in European sales of
$334,000 (32%) and $1,186,000 (42%), for the three months and six months
ended June 30, 1999 compared to the same periods of the preceding year.
Interest and other income decreased by approximately $24,000 and $33,000 for
the three months and six months ended June 30, 1999 compared to the same
periods of the preceding year, which includes a decrease in interest as a
result of a reduction in invested cash balances.

     Significant reductions in sales of Techdyne (Europe) have resulted in
net losses for this subsidiary amounting to $201,000 and $278,000 for the
three months and six months ended June 30, 1999 and $129,000 and $141,000
for the same periods of the preceding year.

<PAGE>

Results of Operations (continued)

     There was a decrease in sales to Compaq (Europe) by Techdyne (Europe),
of $214,000 (84%) and $1,520,000 (93%) for the three months and six months
ended June 30, 1999 compared to the same periods of the preceding year.
Sales of Techdyne (Europe) to Compaq, which was at one time a major customer
of Techdyne (Europe), accounted for only approximately 6% of sales for the
six months ended June 30, 1999 compared to 57% for the same period of the
preceding year. The bidding for Compaq orders has become more competitive
which has continued to result in substantial reductions in Compaq sales and
lower profit margins on remaining Compaq sales. Techdyne (Europe) has been
pursuing new business development to offset the substantial reduction in
Compaq sales as well as substantial reductions in sales to other customers;
however its efforts have not been successful in increasing sales of Techdyne
(Europe).

     Approximately 44% of the Company's consolidated sales for the six months
ended June 30, 1999 were made to five customers.  Customers generating at
least 10% of sales included PMI Food Equipment Group (17%).  PMI Food Equip-
ment Group is Lytton's major customer and represented 31% of Lytton's sales
for the six months ended June 30, 1999.  The loss of, or substantially
reduced sales to any major customer, would have an adverse effect on the
Company's operations if such sales are not replaced.

     Cost of goods sold as a percentage of sales amounted to 88% and 89% for
the three months and six months ended June 30, 1999 compared to 87% and 86%
for the same periods of the preceding year reflecting changes in product mix
and a diversification of the Company's customer base.

     Selling, general and administrative expenses increased by $223,000 and
$192,000 for the three months and six months ended June 30, 1999 compared to
the same periods of the preceding year including costs associated with
increased sales of Lytton.

     Interest expense increased $22,000 for both the three months and six
months ended June 30, 1999 compared to the same periods of the preceding
year.  Interest on advances from the Parent increased approximately $9,000
and $20,000 for these periods as a result of higher outstanding balances
with other increases resulting from additional borrowings in interest on
other debt.  The prime rate was 7.75% at June 30, 1999 and December 31, 1998.

Liquidity and Capital Resources

     The Company had working capital of approximately $7,000,000 at June 30,
1999, a decrease of $2,321,000 (25%) during the first six months of 1999.
Included in the changes in components of working capital was a decrease of
$820,000 in cash and cash equivalents, which included net cash used in
operating activities of $105,000, net cash used in investing activities of
$1,016,000 (including $724,000 from additions to property and equipment and
additional consideration of $290,000 regarding the Lytton acquisition) and
net cash provided by financing activities of $334,000 (including Lytton's
net borrowings on its line of credit of $345,000, other Lytton borrowings
of $375,000 to finance equipment acquisitions, and payments on long-term
$360,000).

     The Company has a five-year $1,500,000 ("notional amount under interest
rate swap agreement") commercial term loan with monthly principal payments
of $25,000 plus interest at 8.60%, which had an outstanding balance of
$1,050,000 at June 30, 1999 and $1,200,000 at December 31, 1998 and a
$1,600,000 commercial revolving line of credit with interest at prime which
was fully drawn down as of June 30, 1999 and December 31, 1998.  The com-
mercial term loan matures December 15, 2002 and the commercial line of
credit matures May 1, 2000.  See Note 3 to "Notes to Consolidated Condensed
Financial Statements."

     The Company had obtained in 1996 two other term loans from its Florida
bank.  One is a $712,500 term loan, which had a remaining principal balance
of $621,000 at June 30, 1999 and $636,000 at December 31, 1998, and is
secured by two buildings and land owned by the Parent.  The second term loan
for $200,000, which had a remaining principal balance of $67,000 at June 30,
1999 and $87,000 at December 31, 1998, is secured by the Company's tangible
personal property, goods and equipment.  The Parent has guaranteed the
revolving line and the three term loans and subordinated the intercompany
indebtedness due it from the Company to the bank's position.  See Note 3 to
"Notes to Consolidated Condensed Financial Statements."

     The Company has outstanding borrowings of $145,000 from a local bank
with interest payable monthly with the note, which was renewed during 1997,
maturing April 2000.

<PAGE>

Liquidity and Capital Resources (continued)

     In July, 1994 Techdyne (Scotland) purchased the facility housing its
operations for approximately $730,000, obtaining a 15-year mortgage which
had a U.S. dollar equivalency of approximately $502,000 at June 30, 1999
and $545,000 at December 31, 1998, based on exchange rates in effect at each
of these dates.  See Note 3 to "Notes to Consolidated Condensed Financial
Statements."

     On July 31, 1997, the Company acquired Lytton which is engaged in the
manufacture and assembly of PCBs and other electronic products for commer-
cial customers. This acquisition required $2,500,000 cash, funded by the
modified bank line of credit, as well as 300,000 shares of the Company's
common stock which had a fair value of approximately $1,031,000 based on
the closing price of the Company's common stock on the date of acquisition.
The Company guaranteed $2,400,000 minimum proceeds from the sale of these
securities based on Lytton having achieved certain earnings objectives. The
Stock Purchase Agreement also provided for incentive consideration to be paid
in cash based on specific sales levels of Lytton for each of three successive
specified years, resulting in additional consideration of approximately
$290,000 and $154,000 for the first two years of sales levels paid in April
1999 and April 1998, respectively. The Lytton acquisition has expanded the
Company's customer base, broadened its product line, enhanced its manufac-
turing capabilities and provided a new geographic area to better serve the
Company's existing customer base with opportunities to attract new customers.
The Guaranty in the Stock Purchase Agreement was modified by the Company and
the seller.  In July 1999, the Company issued a payment of $1,100,000 and
forgave an advance of $1,278,000 made in July 1998 to satisfy its remaining
obligation under the $2,400,000 guarantee.  See Note 9 to "Notes to Consoli-
dated Condensed Financial Statements."

     With one bank, Lytton had (i) a $1,500,000 revolving bank line of credit
requiring monthly interest payments at prime plus 1/2%; (ii) a $1,000,000
installment loan maturing August 1, 2002, at an annual rate of 9% until
July 1999, with monthly payments of $16,667 plus interest, at which time
Lytton had an option to convert the note to a variable rate; and (iii) a
$500,000 equipment loan agreement payable through August 1, 2003 with interest
at prime plus 1%.  These loans were replaced effective June 30, 1999 with a
$3,000,000 revolving line of credit maturing June 30, 2000, a $1,400,000
installment loan payable in 60 installments commencing August 1, 1999 with
the final installment due June 30, 2004 and a $500,000 equipment loan agree-
ment payable through June 30, 2004.  All of these bank loans are secured by
the business assets of Lytton.  See Note 3 to "Notes to Consolidated
Condensed Financial Statements."

     Lytton conducts a portion of its operations with equipment acquired
under equipment financing obligations which extend through July 1999 with
interest rates ranging from 8.55% to 10.09%, and has an equipment loan at
an annual interest rate of 5.5% maturing in April 2001 with monthly payments
of principal and interest of $4,298 secured by equipment.  See Note 3 to
"Notes to Consolidated Condensed Financial Statements."

     A significant customer of the Company, which accounted for 4% of sales
for the six months ended June 30, 1999 and 9% of sales for the same period
of the preceding year has been slow in paying amounts due to the Company.
The Company has substantial receivables and inventory relating to a sales
contract with the customer.  See "Major Customers" under Note 1 to "Notes to
Consolidated Condensed Financial Statements."

     The Company anticipates that current levels of working capital and
working capital from operations, will be adequate to successfully meet
liquidity demands for at least the next twelve months.

New Pronouncements

     In June, 1998, the Financial Accounting Standards Board issued Financial
Accounting Standards Board Statement No. 133, "Accounting for Derivative
Instruments and Hedging Activities" (FAS 133).  FAS 133 is effective for
fiscal years beginning after June 15, 2000.  FAS 133 establishes accounting
and reporting standards for derivative instruments and for hedging activities
and requires, among other things, that all derivatives be recognized as
either assets or liabilities in the statement of financial position and that
those instruments be measured at fair value.  The Company is in the process
of determining the impact that the adoption of FAS 133 will have on its
consolidated financial statements.

Inflation

     Inflationary factors have not had a significant effect on the Company's
operations.  The Company attempts to pass on increased costs and expenses by
increasing selling prices when and where possible and by developing different
and improved products for its customers that can be sold at targeted profit
margins.

<PAGE>

                        PART II -- OTHER INFORMATION
                        ----------------------------

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


      On June 9, 1999, the annual meeting of shareholders was held to elect
seven members to the board of directors to serve until the next annual
meeting in 2000.  Each nominee, five of whom have been directors for many
years, Messrs. Thomas K. Langbein, Barry Pardon, Joseph Verga, Peter D.
Fischbein and Anthony C. D'Amore, and two new nominees, Lytton Crossley
and Edward Diamond were elected by a vote of 3,385,237 shares for an no
votes against.  There were no abstentions and no broker non-votes by virtue
of the fact that no proxies were solicited, since the Parent, Medicore, Inc.
owned 61.5% of the voting equity of the Company.  Ernst & Young LLP, the
Company's independent accountants, were not ratified as the Company's
independent auditors for 1999 with no votes for ratification, 102,440
against, and 3,282,797 abstentions.  As of August 6, 1999, the Company
replaced Ernst & Young LLP with new independent auditors, Wiss & Company,
LLP.


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

     (a)  Exhibits

          Part I Exhibits

               (27) Financial Data Schedule (for SEC use only)

          Part II Exhibits

               None

     (b)  Reports on Form 8-K

          A Current Report on Form 8-K was filed on July 21, 1999 relating
          to Item 5, "Other Events" disclosing a consulting agreement.  No
          financial statements were filed.

                                 SIGNATURES

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

                                       TECHDYNE, Inc.

                                          /s/  Daniel R. Ouzts

                                       By ---------------------------------
                                          DANIEL R. OUZTS, Vice President/
                                          Finance, Controller and Principal
                                          Accounting Officer

Dated: August 13, 1999

<PAGE>

                               EXHIBIT INDEX


Exhibit
   No.
-------

Part I Exhibits

      (27) Financial Data Schedule (for SEC use only)