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 0-13817


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


        Delaware                                 84-8963939
-------------------------------      ------------------------------------
(State or other jurisdiction         (I.R.S. Employer Identification No.)
of incorporation or organization)


129 N. Main Street      Yale, Michigan                           48097
--------------------------------------                         ----------
(Address of principal executive offices)                       (Zip Code)

  (Registrant's telephone number, including area code) (810) 387-4300
                                                        --------------

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

As of June 30, 1999, the Company had 1,489,214 shares of its $.015 Par
Value Common Stock outstanding.

<PAGE>

                        MARGATE INDUSTRIES, INC.

                                FORM 10-Q


                                  INDEX
                                  -----


PART I:     FINANCIAL STATEMENTS                                PAGE(S)
-------     --------------------                                -------


Item 1.     Financial Information


            Consolidated Balance Sheets. . . . . . . . . . . . . . 3-4


            Consolidated Income Statement. . . . . . . . . . . . . . 5


            Consolidated Statements of Changes in
              Stockholders' Equity . . . . . . . . . . . . . . . . . 6


            Consolidated Statements of Cash Flows. . . . . . . . . . 7


            Notes to Consolidated Financial
              Statements . . . . . . . . . . . . . . . . . . . .8 - 10


Item 2.     Management's Discussion and Analysis of Financial
              Condition and Results of Operations. . . . . . . 11 - 12


PART II:    OTHER INFORMATION. . . . . . . . . . . . . . . . . . . .13
-------     -----------------



                                   -2-

<PAGE>

                MARGATE INDUSTRIES, INC. AND SUBSIDIARIES
                       CONSOLIDATED BALANCE SHEETS
                -----------------------------------------

                                                 June 30, 1999  Dec. 31, 1998
                                                 -------------  -------------

ASSETS                                            (Unaudited)
------

CURRENT ASSETS
   Cash and cash equivalents                       $1,625,128     $1,504,725

   Accounts receivable                              1,585,125      1,569,446

   Current maturities of notes receivable             112,381        108,571

   Inventories                                        107,900         43,000

   Prepaid expenses and other                          76,354         60,049

   Prepaid Federal income tax                               -         21,700

   Deferred tax asset                                  10,500         10,500
                                                   ----------     ----------

         Total Current Assets                       3,517,388      3,317,991


PROPERTY, PLANT AND EQUIPMENT
   At cost net of accumulated depreciation and
   amortization of $1,813,633 and $1,631,533
   at June 30, 1999 and December 31, 1998,
   respectively                                     3,694,580      3,763,902

NOTES RECEIVABLE - net of current maturities          382,857        440,000

OTHER                                                  39,800         39,800
                                                   ----------     ----------

         Total Assets                              $7,634,625     $7,561,693
                                                   ==========     ==========








See Notes to Consolidated Financial Statements.

                                   -3-

<PAGE>

                MARGATE INDUSTRIES, INC. AND SUBSIDIARIES
                 CONSOLIDATED BALANCE SHEETS (Continued)
                -----------------------------------------

                                                 June 30, 1999  Dec. 31, 1998
                                                 -------------  -------------

LIABILITIES & STOCKHOLDER'S EQUITY                (Unaudited)
----------------------------------

CURRENT LIABILITIES

   Line-of-credit                                  $  191,428     $  585,212
   Currents portion of long-term debt                  56,285         61,710
   Accounts payable                                   392,660        212,306
   Accrued salaries and wages                          88,209         67,233
   Accrued workers' compensation                       10,651          4,651
   Accrued federal income tax                          85,307              -
   Other accrued liabilities                           20,724         15,041
                                                   ----------     ----------
         Total Current Liabilities                    845,264        946,153

DEFERRED TAX LIABILITY                                255,500        255,500
OTHER POSTRETIREMENT BENEFITS                         452,075        452,075
NOTES PAYABLE - Long-term                             163,248        191,599

STOCKHOLDERS' EQUITY:

   Common stock - $.015 par value

      Authorized - 5,000,000
      Issued and outstanding -
       1,489,214 and 1,489,214
       at June 30, 1999 and December 31, 1998,
       respectively                                    22,338         22,338

   Paid-in for common stock in excess of
      par value                                     7,345,038      7,345,038

   Accumulated deficit                             (1,448,838)    (1,651,010)
                                                   ----------     ----------
         Total Stockholders' Equity                 5,918,538      5,716,366
                                                   ----------     ----------
         Total Liabilities and
           Stockholders' Equity                    $7,634,625     $7,561,693
                                                   ==========     ==========

See Notes to Consolidated Financial Statements.

                                   -4-

<PAGE>

                MARGATE INDUSTRIES, INC. AND SUBSIDIARIES
                     CONSOLIDATED INCOME STATEMENTS
                -----------------------------------------
                               (Unaudited)


<TABLE>
<CAPTION>

                                Six Months Ended        Six Months Ended
                                    June 30,                June 30,
                              1999        1998         1999        1998

<S>                          <C>         <C>          <C>         <C>

NET SALES                    $2,566,870  $2,648,632   $5,017,571  $4,930,502

COST OF SALES                 2,200,015   2,355,278    4,355,160   4,467,320
                             ----------  ----------   ----------  ----------

GROSS PROFIT                    366,855     293,354      662,411     463,182
                             ----------  ----------   ----------  ----------

SELLING, GENERAL AND
  ADMINISTRATIVE EXPENSES       215,973     188,553      398,250     406,253
                             ----------  ----------   ----------  ----------

RELATED PARTY SERVICES
  AND SALES COMMISSIONS           1,966       4,231        1,966       4,231
                             ----------  ----------   ----------  ----------

INCOME (LOSS) FROM OPERATIONS   148,916     100,570      262,195      52,698
                             ----------  ----------   ----------  ----------

DIVIDEND AND INTEREST INCOME
  (EXPENSE) - NET                18,453       7,780       34,476     (13,549)

OTHER (EXPENSE)                  12,501           0       12,501    (143,214)
                             ----------  ----------   ----------  ----------

INCOME (LOSS) BEFORE
  PROVISIONS FOR
  EXTRAORDINARY ITEM            179,870     108,350      309,172    (104,065)

GAIN ON SALE OF 45% INTEREST
  IN NEW HAVEN FOUNDRY                -           -            -   2,075,000

INCOME (LOSS) BEFORE PROVISION
  FOR INCOME TAXES              179,870     108,350      309,172   1,970,935

PROVISION FOR FEDERAL
  INCOME TAXES                   63,000      34,527      107,000     166,527
                             ----------  ----------   ----------  ----------

INCOME (LOSS)                $  116,870  $   73,823   $  202,172  $1,804,408
                             ==========  ==========   ==========  ==========

BASIC EARNINGS PER COMMON
  SHARE                          $0.078      $0.048       $0.136      $1.184

WEIGHTED AVERAGE SHARES
  OUTSTANDING                 1,489,214   1,524,548    1,489,214   1,524,548
</TABLE>




See Notes to Consolidated Financial Statements.

                                   -5-

<PAGE>

                MARGATE INDUSTRIES, INC. AND SUBSIDIARIES
       CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
       ----------------------------------------------------------
                               (Unaudited)

<TABLE>
<CAPTION>
                                                   SIX MONTHS ENDED JUNE 30, 1999

                                COMMON STOCK        PAID IN FOR
                              ----------------      COMMON STOCK
                            NUMBER OF               IN EXCESS OF    ACCUMULATED   STOCKHOLDERS'
                             SHARES       AMOUNT      PAR VALUE       DEFICIT        EQUITY
                            --------     --------    -----------     ---------      --------
<S>                         <C>         <C>          <C>            <C>           <C>
Balance - January 1, 1999   1,489,214   $   22,338   $7,345,038     $(1,651,010)  $5,716,366

Net income                         --           --           --         202,172      202,172
                           ----------   ----------   ----------      ----------   ----------

Balance - June 30, 1999     1,489,214   $   22,338   $7,345,038     $(1,448,838)  $5,918,538
                           ==========   ==========   ==========      ==========   ==========
</TABLE>


<TABLE>
<CAPTION>

                                                  SIX MONTHS ENDED JUNE 30, 1998

                                COMMON STOCK       PAID IN FOR
                              ----------------     COMMON STOCK
                            NUMBER OF              IN EXCESS OF   ACCUMULATED    STOCKHOLDERS'
                             SHARES      AMOUNT      PAR VALUE      DEFICIT         EQUITY
                            --------    --------    -----------    ---------      --------
<S>                         <C>         <C>          <C>           <C>            <C>
Balance - January 1, 1998*  1,524,548   $   22,868   $7,410,725    $(3,622,126)   $3,811,467

Net income                         --           --           --      1,804,408     1,804,408
                           ----------   ----------   ----------     ----------    ----------

Balance - June 30, 1998*    1,524,548   $   22,868   $7,410,725    $(1,817,718)   $5,615,875
                           ==========   ==========   ==========     ==========    ==========
</TABLE>

* Shares have been adjusted to reflect one for three reverse split on
November 13, 1998.









See Notes to Consolidated Financial Statements.

                                   -6-

<PAGE>

                MARGATE INDUSTRIES, INC. AND SUBSIDIARIES
                  CONSOLIDATED STATEMENTS OF CASH FLOWS
                -----------------------------------------
                               (Unaudited)


                                                      Six Months Ended
                                                          JUNE 30,
                                                     1999          1998
                                                   ---------     ---------


INCREASE (DECREASE) IN CASH AND CASH
  EQUIVALENTS

OPERATING ACTIVITIES                              $   607,408     $2,313,758

INVESTING ACTIVITIES:
   Purchase of plant and equipment                   (112,778)       (91,649)
                                                   ----------     ----------

Net cash used in investing activities                (112,778)       (91,649)

FINANCING ACTIVITIES:

   Net proceeds (repayments) -
      line of credit (net)                           (393,784)       115,077

   Purchase of common stock                                 -              -

   Principal payments under long-term
      obligations                                     (33,776)      (330,813)

   Decrease (increase) in notes receivable             53,333       (595,550)
                                                   ----------     ----------

Net cash provided by (used in)
   financing activities                              (374,227)      (811,286)

NET INCREASE (DECREASE) IN CASH
   AND CASH EQUIVALENTS                               120,403      1,410,823

CASH AND CASH EQUIVALENTS - Beginning               1,504,725        110,822
                                                   ----------     ----------

CASH AND CASH EQUIVALENTS - Ending                 $1,625,128     $1,521,645
                                                   ==========     ==========







See Notes to Consolidated Financial Statements.

                                   -7-

<PAGE>

                MARGATE INDUSTRIES, INC. AND SUBSIDIARIES
               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
               ------------------------------------------

NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES
          The consolidated Balance Sheet as of June 30, 1999 and the related
          Consolidated Statements of Operations, Changes in Stockholders'
          Equity, and Cash Flows for the six months ended June 30, 1999 and
          1998 are unaudited.  In the opinion of management, all adjustments
          necessary for a fair presentation of such financial statements have
          been included.  The results of operations for the six months ended
          June 30, 1999 and 1998 are not necessarily indicative of the results
          to be expected for the whole year.

          The notes to the financial statements are presented as permitted by
          Form 10-Q and do not contain certain information included in the
          Company's annual financial statements.

NOTE 2 - DIVIDENDS
          The Company had paid dividends from 1992 through the second quarter
          of 1995, but suspended dividends thereafter.

NOTE 3 - STATEMENTS OF CASH FLOWS
          A reconciliation of net income to net cash flows provided by
          operating activities is as follows:

                                                        Six Months Ended
                                                            June 30,
                                                          (Unaudited)
                                                      1999           1998
                                                      ----           ----

Net income                                         $  202,172     $1,804,408
Adjustments to reconcile net income to
  net cash from operating activities:
    Depreciation and amortization                     182,100        182,000
    Loss on disposal of fixed assets                       --        143,214
    Changes in assets and liabilities:
      Accounts receivable                             (15,679)      (115,767)
      Inventories                                     (64,900)       (47,001)
      Prepaid expenses                                (16,305)        (4,842)
      Prepaid Federal tax                              21,700        (59,166)
      Other assets                                         --             --
      Accounts payable                                180,354        171,981
      Accrued workers' compensation                     6,000          6,000
      Accrued salaries and wages                       20,976         11,550
      Accrued Federal Income Tax                       85,307             --
      Deferred income tax                                  --        204,000
      Other liabilities                                 5,683         17,381
                                                   ----------     ----------

        Net cash provided (used) by
         operating activities                      $  607,408     $2,313,758
                                                   ==========     ==========



                                   -8-

<PAGE>

NOTE 4 - EARNINGS PER SHARE
          The weighted average number of shares used to compute the net income
          per shares was 1,489,214 and 1,524,548 for the three month periods
          ended June 30, 1999 and 1998, respectively.

NOTE 5 - NOTES PAYABLE
          Notes payable consist of the following at June 30, 1999:

          Note payable Ft. Atkinson, due in monthly
          installments of $3,992, including interest
          at 4% through July 2003.                                186,883

          Capital lease - Ft. Atkinson - due in
          monthly installments of $705 including
          interest at 17.9% through July 2001                      14,305

          Capital lease - Yale - due in monthly
          installments of $828.48 including interest
          at 9.0% maturing September 2001.                         18,345
                                                                ---------

                                                                  219,533
          Less current portion                                     56,285
                                                                ---------
                                                                $ 163,248

          Maturities of notes payable obligations are as follows:

          Year ended June 30:

          2000:                                                 $  56,285
          2001:                                                    58,767
          2002:                                                    46,233
          2003:                                                    46,419
          2004:                                                    11,829
                                                                ---------

                                                                $ 219,533
                                                                =========

     The Company maintains a bank line-of-credit of $1,300,000 for working
     capital requirements.  The applicable interest rate is at 1/2% below the
     prime lending rate, currently 7.5% at June 30, 1999.  The line-of-credit
     is secured by all accounts receivable, inventories and equipment
     of the Company.  Additionally, certain required financial ratios must
     be maintained.  The Company is in compliance with all covenant
     requirements as of June 30, 1999.  The Company has borrowings against
     the line of $191,428 and $741,076 at June 30, 1999 and 1998, respectively.



                                   -9-

<PAGE>

NOTE 6 - NOTES RECEIVABLE

         Notes receivable consist of the following at June 30, 1999:

         Notes receivable - Wesley Industries, Inc.
         due in quarterly payments of $35,000
         commencing June 1, 1998, including imputed
         interest, with a final payment of the remaining
         outstanding principal and imputed interest balance
         on March 1, 2003.                                      $ 495,238

         Less current portion                                     112,381
                                                                ---------
                                                                $ 382,857
                                                                =========

NOTE 7 - SALE OF STOCK IN INVESTEE COMPANY
         On March 24, 1998, the Company sold its remaining 45% interest in New
         Haven Foundry to Wesley Industries, Inc. which owned the other 55%.
         Terms of the agreement included a purchase price of $2,200,000 paid
         $1,500,000 at closing and the $700,000 balance including interest due
         in the form of a promissory note payable in quarterly installments of
         $35,000.  The promissory note is secured by the shares of the New
         Haven Foundry.  In addition, the Company entered into a new cleaning
         contract with New Haven Foundry which includes a per piece price and
         a service fee of $2,800,000 paid in quarterly installments of $140,000
         over five (5) years.  The gain on sale is reported on the consolidated
         income statement net of legal fees.









                                  -10-

<PAGE>

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

     The following is management's discussion and analysis of certain
significant factors which have affected the Company's financial condition
and results of operation during the periods included in the accompanying
consolidated financial statements for the six (6) months ended June 30, 1999.

FORWARD-LOOKING STATEMENTS MAY NOT PROVE ACCURATE
-------------------------------------------------

     When used in this Form 10-Q, the words "anticipate," "estimate,"
"expect," "project," and similar expressions are intended to identify
forward-looking statements.  Such statements are subject to certain risks,
uncertainties and assumptions including the possibility that the Company's
projected sales, revenues and contract negotiations are not realized.
Should one or more of these uncertainties materialize, or should underlying
assumptions prove incorrect, actual results may vary materially from those
anticipated, estimated or projected.

LIQUIDITY & CAPITAL RESOURCES
-----------------------------

     The Company has a consolidated line of credit of $1,300,000 with
monthly interest payments at the prime rate with the National Bank of
Detroit.  The line is collateralized by substantially all assets.
Borrowings as of June 30, 1999 was $191,428.

RESULTS OF OPERATIONS
---------------------

     The Company is reporting year-to-date pre-tax profit on operations
before extraordinary item of $309,172 for the six months ended June 30,
1999 as compared to a loss of ($104,065) for the same period in 1998.  Net
sales for the period ended June 30, 1999 were approximately $5,017,571;
which represents an increase of 1.8% from 1998 sales through June 30, 1998
of $4,930,502.  The loss in 1998 includes a one-time loss of $143,214 due
to the abandonment of leasehold improvements upon the expiration of the
building lease of the Michigan Casting plant.  The production operations
were previously consolidated with Yale Industries in 1996.

     The cost of sales for the six months ended June 30, 1999 as a percentage
of sales was 86.8% as compared to 90.6% for the same period in 1998.

     Selling, General and Administrative for the three months ended June 30,
1999 as a percentage of sales was 7.9% as compared to 8.2% for the same
period in 1998.

IMPACT OF THE YEAR 2000 ISSUE
-----------------------------

     The Year 2000 Issue is the result of computer programs being written
using two digits rather than four to define the applicable year.  Any of
the Company's computer programs that have date-sensitive software may
recognize a date using "00" as the year 1900 rather than the year 2000.
This could result in a system failure or miscalculations causing
disruptions of operations,

                                  -11-

<PAGE>

including, among other things, a temporary inability to process
transactions, send invoices, or engage in similar normal business
activities.  Based on an assessment of its computer systems, the Company
believes that it will not encounter significant operational problems or be
required to modify or replace significant portions of its software so that
its computer systems will properly utilize dates beyond December 31, 1999.
In particular, the Company has installed current compliant software for its
inventory and made inquiries of its vendors to insure they are taking
proper steps to insure 2000 compliance.  However, if problems are
encountered and modifications and conversions are not timely made, the Year
2000 problem may have an impact on the operations of the Company.









                                  -12-

<PAGE>

                                 PART II

Item 1.   Legal Proceedings
          -----------------

          The Company is not engaged in any material pending legal
          proceeding to which the Company is a party or to which any of its
          property is subject.

Item 2.   Changes in Securities
          ---------------------

          None

Item 3.   Defaults Upon Senior Securities
          -------------------------------

          None

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

          An Annual Meeting of Shareholders was held on June 10, 1999 for
          the election of Directors and a proposal to reduce the authorized
          capital of the corporation from 25,000,000 shares of Common Stock
          to 5,000,000 shares of Common Stock and change the par value to
          $.015.  The following summarizes the vote at the meeting:

          Election of Directors - With Terms Expiring at the Annual Meeting
          ---------------------------------------------------------------
          in 2002:
          -------

                                                 For      Against   Abstain
                                                 ---      -------   -------
          Dennis R. LeDuc                       929,943     1,962      0

          Amendment To Articles of Incorporation:
          --------------------------------------

                                                 For      Against   Abstain
                                                 ---      -------   -------
          Reduction of Authorized Capital       932,676    79,095      0

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

          None

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

          No Reports on Form 8-K were filed during the quarter.



                                  -13-

<PAGE>

                               SIGNATURES
                               ----------


     Pursuant to the requirements of Section 13 or 15(d) 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.

MARGATE INDUSTRIES, INC.



By: /s/ William H. Hopton
   -------------------------------
     William H. Hopton

Date:     July 29, 1999