SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                    FORM 10-Q


(Mark One)

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

                 For the quarterly period ended October 31, 1998

                                       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 0-18198

                              DeVlieg-Bullard, Inc.
             (Exact name of registrant as specified in its charter)

                Delaware                                         62-1270573
     (State or other jurisdiction of                          (I.R.S. Employer
     incorporation or organization)                          Identification No.)

     One Gorham Island, Westport, CT                                06880
(Address of principal executive offices)                         (Zip Code)

                                  203-221-8201
              (Registrant's telephone number, including area code)

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___

The number of shares of common  stock  outstanding  as of  December  1, 1998 was
12,334,900.


<PAGE>



                         PART I - FINANCIAL INFORMATION
                          Item 1. Financial Statements

                              DeVlieg-Bullard, Inc.
                                 Balance Sheets
                        (in thousands, except share data)

<TABLE>
<CAPTION>
                                                           October 31,    July 31,
                                                              1998          1998
                                                            ---------    ---------
<S>                                                         <C>          <C>      
ASSETS                                                     (unaudited)
Current assets:
     Cash and cash equivalents                              $     767    $     365
     Accounts receivable, net                                  22,518       24,895
     Inventories, net                                          49,088       45,459
     Other current assets                                       1,501        1,418
                                                            ---------    ---------
         Total current assets                                  73,874       72,137

Property, plant and equipment, net                              8,469        8,781
Assets held for sale                                            1,692        1,692
Engineering drawings, net                                      16,200       16,393
Goodwill, net                                                  10,900       11,025
Other assets, net                                              14,440       13,887
                                                            ---------    ---------
         Total assets                                       $ 125,575    $ 123,915
                                                            =========    =========

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
     Accounts payable                                       $  20,577    $  17,625
     Accrued expenses and other current liabilities             7,203       10,007
     Revolving credit agreement                                29,153       25,670
     Current portion of long-term debt                          4,874        5,201
                                                            ---------    ---------
         Total current liabilities                             61,807       58,503

Long-term debt (related party $4,375)                          13,142       13,528
Postretirement benefit obligation                              21,562       21,357
Other noncurrent liabilities                                   10,816       11,121
                                                            ---------    ---------
         Total liabilities                                    107,327      104,509

Stockholders' equity:
     Common stock, $0.01 par value; authorized
         30,000 shares; issued and outstanding
         12,334,900 shares                                        123          123
     Additional paid-in capital                                34,230       34,230
     Excess purchase price over net assets acquired from
         related parties                                      (16,242)     (16,242)
     Retained earnings                                            252        1,438
     Cumulative translation adjustment                           (115)        (143)
                                                            ---------    ---------
         Total stockholders' equity                            18,248       19,406
                                                            ---------    ---------
         Total liabilities and stockholders' equity         $ 125,575    $ 123,915
                                                            =========    =========
</TABLE>

The accompanying notes are an integral part of these financial statements.


                                       2
<PAGE>


                              DeVlieg-Bullard, Inc.
                             Statement of Operations
                (unaudited - in thousands, except per share data)

                                                             Three Months Ended
                                                                 October 31,
                                                             1998         1997
                                                           --------     --------

Net sales                                                  $ 26,600     $ 26,483
Cost of sales                                                20,338       18,495
                                                           --------     --------
     Gross profit                                             6,262        7,988

E S G & A expenses:
     Engineering                                                609          496
     Selling                                                  2,985        2,744
     General and administrative                               3,409        2,968
                                                           --------     --------
         Total E S G & A expenses                             7,003        6,208

Other income, net                                               241           11
                                                           --------     --------

Operating (loss)/income                                        (500)       1,791

Interest expense (including related party interest
     of $176 and $171)                                        1,385        1,320
                                                           --------     --------

(Loss)/income before income taxes                            (1,885)         471

Income tax (benefit)/provision                                 (699)         199
                                                           --------     --------

Net (loss)/income                                          $ (1,186)    $    272
                                                           ========     ========

(Loss)/income per common share:
     Basic                                                 $  (0.08)    $   0.02
                                                           ========     ========
     Diluted                                               $  (0.08)    $   0.02
                                                           ========     ========

Average common shares and equivalents outstanding
     Basic                                                   14,107       14,060
                                                           ========     ========
     Diluted                                                 14,107       15,465
                                                           ========     ========

The accompanying notes are an integral part of these financial statements.


                                       3
<PAGE>


                              DeVlieg-Bullard, Inc.
                            Statements of Cash Flows
                           (unaudited - in thousands)

<TABLE>
<CAPTION>
                                                                         Three Months Ended
                                                                             October 31,
Cash flows from operating activities:                                     1998        1997
                                                                        --------    --------
<S>                                                                     <C>         <C>     
Net (loss)/income                                                       $ (1,186)   $    272
Adjustments to reconcile net (loss)/income to net cash provided by 
     operating activities:
         Depreciation and amortization                                     1,265       1,221
         Deferred income taxes                                              (762)       --
         Provision for losses on accounts receivable                         151          47
         Net gain on sale of assets                                         (241)       --
Changes in assets and liabilities, net of effects from acquisitions
     Accounts receivable                                                   2,226       3,103
     Inventories                                                          (3,629)     (1,578)
     Other current assets                                                    (83)        (74)
     Accounts payable                                                      2,952         882
     Accrued expenses and other current liabilities                       (2,804)     (2,690)
     Other, net                                                             (103)       (497)
                                                                        --------    --------
     Net cash (used for)/provided by operating activities                 (2,214)        686

Cash flows from investing activities:
     Capital expenditures                                                   (149)       (534)
     Proceeds from sale of assets                                            241
                                                                        --------    --------
     Net cash provided by/(used for) investing activities                     92        (534)

Cash flows from financing activities:
     Borrowings under revolving credit agreement                          30,378      30,302
     Repayments under revolving credit agreement                         (26,895)    (29,245)
     Payments of long-term debt                                             (987)       (768)
                                                                        --------    --------
     Net cash provided by financing activities                             2,496         289

Effect of exchange rate changes on cash                                       28         (59)
                                                                        --------    --------

Net increase in cash and cash equivalents                                    402         382
Cash and cash equivalents at beginning of period                             365         637
                                                                        --------    --------
Cash and cash equivalents at end of period                              $    767    $  1,019
                                                                        ========    ========

Supplemental disclosure of cash flow information:

Cash paid during the period for:
     Interest                                                           $  1,175    $  1,166
     Income taxes, net of refunds                                             27          13
</TABLE>

During the three months  ended  October 31, 1998 and 1997,  the Company  entered
into capital leases for computer equipment totaling $102 and $448, respectively,
which were financed by capital lease obligations.

The accompanying notes are an integral part of these financial statements.

                                       4
<PAGE>

                              DeVlieg-Bullard, Inc.
                     Notes to Unaudited Financial Statements

NOTE 1: Basis of Presentation

Pursuant to the rules and regulations of the Securities and Exchange  Commission
for  Form  10-Q,  the  financial  statements,  footnote  disclosures  and  other
information  normally  included in financial  statements  prepared in accordance
with generally accepted accounting principles have been condensed. The financial
statements  contained  in this report are  unaudited  but, in the opinion of the
management of  DeVlieg-Bullard,  Inc. (the "Company"),  reflect all adjustments,
consisting of only normal recurring adjustments, necessary to fairly present the
financial position as of October 31, 1998 and the results of operations and cash
flows for the interim  periods of the fiscal year ending July 31, 1999  ("fiscal
1999") and the fiscal year ended July 31, 1998 ("fiscal 1998") presented herein.
The results of operations for any interim period are not necessarily  indicative
of results for the full year. These financial  statements,  footnote disclosures
and  other  information  should  be  read  in  conjunction  with  the  financial
statements and the notes thereto included in the Company's annual report on Form
10-K for the year  ended July 31,  1998.  Certain  amounts  in the  fiscal  1998
financial  statements  have been  reclassified  to conform  to the  fiscal  1999
presentation.

The financial  statements  include all accounts of the Company after elimination
of all significant  interdivision  transactions  and balances.  Amounts in these
notes, except per share data, are expressed in thousands.

NOTE 2: Inventories

                                                    October 31,         July 31,
Inventories consisted of:                             1998               1998
                                                     -------            -------
                                                   (unaudited)
Raw materials                                        $ 1,453            $ 1,620
Work-in-process                                       14,609             14,671
Finished goods                                        33,026             29,168
                                                     -------            -------
                                                     $49,088            $45,459
                                                     =======            =======

Valuation  reserves for obsolete,  excess and slow-moving  inventory  aggregated
$9,205  and  $10,556  at  October  31,  1998 and July  31,  1998,  respectively.
Inventories  valued  using LIFO were $20,747 and $19,298 at October 31, 1998 and
July  31,  1998,   respectively.   There  was  no  LIFO  reserve  against  those
inventories.  The financial  accounting  basis for the  inventories  of acquired
companies  exceeds  the tax basis of $12,224 at  October  31,  1998 and July 31,
1998.



                                       5
<PAGE>

NOTE 3: Segment Reporting

Financial information for each of the Company's segments is summarized below:

<TABLE>
<CAPTION>
                                                                Machine     Tooling
                                       Services     Tool        Systems    Industrial
                                        Group       Group        Group        Group      Corporate     Total(a)
                                      ---------   ---------    ---------    ---------    ---------    ---------
<S>                                   <C>         <C>          <C>          <C>          <C>          <C>      
Three months ended October 31, 1998
Sales                                 $   9,691   $   6,659    $   4,424    $   5,890    $    --      $  26,664
Intersegment sales                         --          --            (64)        --           --            (64)
Net sales                                 9,691       6,659        4,360        5,890         --         26,600
Operating income (a)                      1,209      (1,001)         220          (41)        (887)        (500)
Identifiable assets                      52,089      31,668       18,063        8,495       15,260      125,575

Three months ended October 31, 1997
Net sales                             $   9,509   $   5,584    $   5,322    $   6,068    $    --      $  26,483
Operating income                          2,954      (1,540)         813          400         (836)       1,791
Identifiable assets                      44,440      35,525       18,820        7,970       13,420      120,175
</TABLE>

(a)  Interest  expense and income  taxes are  primarily  allocated  as Corporate
     expenses.

NOTE 4: Earnings per Share

The table below sets forth the  computation  of the weighted  average  number of
shares used for basic and diluted earnings per share:

                                                  Three months ended October 31,
                                                        1998      1997(c)
                                                       ------     -------
Average common shares outstanding                      12,335     12,275
Stock purchase warrants (a)                             1,772      1,785
                                                       ------     ------
Average common shares outstanding - basic              14,107     14,060
Effect of dilutive securities:
     Contingently issuable stock purchase warrants           (b)     748
     Stock options                                       --  (b)     657
                                                       ------     ------
Average common shares outstanding - diluted            14,107     15,465
                                                       ======     ======

(a)  Class A and Class B Stock Purchase Warrants are included in the computation
     of basic earnings per share.

(b)  When a net loss is  recorded,  additional  shares  for  stock  options  and
     contingent stock purchase warrants are not included because their inclusion
     would be  antidilutive.  Because  the first  quarter  fiscal  1999  results
     reflect a net loss,  basic and diluted  earnings  per share are  calculated
     based on the same weighted average number of shares outstanding.

(c)  Fiscal  1998  has been  restated  in  accordance  with  the  provisions  of
     Statement of Financial Accounting Standards No. 128 "Earnings per Share."


                                       6
<PAGE>


                              DeVlieg-Bullard, Inc.
           MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                            AND RESULTS OF OPERATIONS

Results of Operations

Summarized  below is a discussion  of the results of  operations of the Company,
including its Services,  Machine Tool, Tooling Systems and Industrial  operating
groups. Amounts, except per share data, are expressed in thousands.

Three months ended  October 31, 1998  compared to three months ended October 31,
1997.

Net sales for the first quarter of fiscal 1999 were $26,600,  basically the same
as the  $26,483  reported in the first  quarter of fiscal  1998.  First  quarter
fiscal  1999 sales as compared  to the first  quarter of fiscal  1998  increased
19.3% for the  Machine  Tool Group and 1.9% for the  Services  Group,  while the
Industrial Group declined 2.9% and the Tooling Systems Group declined 18.1%.

Gross profit for the first quarter of fiscal 1999 was $6,262  compared to $7,988
for the  first  quarter  of  fiscal  1998,  a  decrease  of  $1,726,  or  21.6%.
Improvements  at the  Machine  Tool Group were  offset by  declines at the other
operating groups.

E S G & A expenses  were $7,003,  or 26.3% of net sales in the first  quarter of
fiscal 1999, and $6,208,  or 23.4% of net sales,  in the first quarter of fiscal
1998.  The  increase in  operating  expenses  was  primarily at the Services and
Machine  Tool  Groups  for  increased   engineering   expenses  related  to  the
outsourcing efforts and at Powermatic for increased computer related costs.

Interest  expense  was $1,385 in the first  quarter of fiscal  1999  compared to
$1,320 in the first quarter of fiscal 1998.

An income tax benefit of $699 was  recorded for the first three months of fiscal
1999  reflecting  the loss recorded for the period,  compared to expense of $199
for the first three months of fiscal 1998  reflecting the income reported in the
prior year period.

Operating Results by Business Segment

Services  Group sales were $9,691 for the first  quarter of fiscal 1999 compared
to $9,509 for the same period in the prior year. The  improvement  was primarily
in the  aftermarket  parts business of National Acme,  offset by declines in the
other  aftermarket  product lines and field services.  Operating  profit for the
first  quarter of fiscal  1999 was  $1,209,  a decline of $1,745 from the $2,954
reported  during  the  first  quarter  of the  prior  year.  Operating  expenses
increased as a result of engineering  costs related to the  outsourcing  project
and gross profit was adversely effected by unfavorable  purchase price variances
related to small quantity rush orders to fill immediate needs.

Machine  Tool Group sales were $6,659 for the first three months of fiscal 1999,
an increase  of $1,075,  or 19.3%,  over the $5,584  reported in the first three
months of the prior  fiscal year.  The Machine Tool Group  reported an operating
loss of $1,001  for the first  quarter  of fiscal  1999,  compared  to a loss of
$1,540  in the  same  period  a  year  ago.  Although  gross  profit  increased,
reflecting the additional sales volume and increased  productivity,  engineering
costs related to the outsourcing project were higher during the quarter compared
to the prior year.

Tooling  Systems  Group sales were $4,360 in the first  quarter of fiscal  1999,
compared to $5,322 in the first  quarter of the prior year,  a decrease of $962,
or 18.1%, as a result of the GM strike during the summer and deteriorating world
business  conditions.  Operating income for the first quarter of fiscal 1999 was
$220,  compared with $813 in the first quarter of the prior year. The decline in
operating income is the result of the decreased volume.

Industrial Group sales were $5,890 in the first quarter of fiscal 1999, compared
to $6,068 in the first  quarter of the prior year, a decrease of $178,  or 2.9%.
Operating income was a loss of $41 for the first quarter of


                                       7
<PAGE>

fiscal  1999,  compared  to  income of $400 in the same  period a year ago.  The
decline  in  operating  income is due to  additional  depreciation  related to a
computer upgrade and repairs and maintenance expense.

Liquidity and Capital Resources

Cash Flows

Historically,   the  Company's  continuing  operations  have  been  financed  by
internally  generated  funds.  Acquisitions  have been funded with  increases in
indebtedness,  while funds from  divestitures have generally been used to reduce
indebtedness.  As the operating difficulties the Company reported in fiscal 1998
continued  into the first  quarter of fiscal  1999,  operating  activities  were
financed by increasing indebtedness.

The Company  experienced a lack of availability of parts from venders during the
first  quarter of fiscal  1999 due in part to a lack of  availability  under the
senior credit facility.  The Company's liquidity position improved following the
end of the first  quarter  as a result  of  increases  in term  loans and in the
amount  available  under  the  revolving  credit  agreement.  Liquidity  further
improved from the shipment of certain large machine orders from the Machine Tool
Group following the end of the first quarter.  Total accounts  payable have been
reduced from $20.6  million at October 31, 1998 to $16.8 million at November 30,
1998, a 19% reduction.  Normal  seasonal issues with sales and orders and a low,
but improving, vendor on-time delivery performance continue to hold down overall
performance.

Net cash used by  operations  was $2,214 for the three months ended  October 31,
1998 as compared to net cash  provided by operating  activities  of $686 for the
three months ended October 31, 1997.

Cash used for capital  expenditures  was $149 and $534 for the first  quarter of
fiscal 1999 and 1998,  respectively.  The first  quarter of fiscal 1999 includes
$241 of proceeds from the sale of excess machinery and equipment.

Financing and Investing

The balance  outstanding  under the  Company's  revolving  credit  agreement was
$29,153 at October 31,  1998,  compared to $25,670 at July 31,  1998.  Long-term
debt, including current maturities,  at October 31, 1998, was $18,016,  compared
to  $18,729  at  July  31,  1998,  a  decrease  of  $713.  The  Company's  total
indebtedness  was $47,169  and  $44,399 at October  31, 1998 and July 31,  1998,
respectively,  an increase of $2,770.  The  increase in debt was used to finance
working  capital needs.  Cash and  equivalents at October 31, 1998 were $767, an
increase  of $402  compared to July 31,  1998.  Net cash  provided by  financing
activities  was $2,496 in the first  quarter of fiscal 1999 compared to a use of
$289 in the first quarter of the prior year.

The senior credit  facility  aggregating  $40,000 is comprised of $6,000 in term
loans and a revolving  credit  agreement,  which  provides for  borrowings up to
$30,000.  Interest on the  outstanding  borrowings  under the  revolving  credit
agreement  is  payable  monthly in arrears at 1% above the prime rate or, at the
Company's  option, at alternative rates based on LIBOR. The effective rate based
on LIBOR was 8.41% at October 31, 1998.  The amount the Company may borrow under
the revolving  credit agreement is based upon a formula related to the Company's
eligible accounts receivable and inventories,  reduced by outstanding letters of
credit.  The  Company has no unused  borrowings  available  under its  revolving
credit 


                                       8
<PAGE>

agreement at October 31, 1998. However, with changes negotiated to the agreement
subsequent   to  the  quarter   (see  below),   availability   is  estimated  at
approximately $1,000 on December 11, 1998.

The term loans require monthly principal payments of $200.  Interest on the term
loans is payable monthly at 1.25% above prime rate or, at the Company's  option,
at alternative rates based on LIBOR. The effective rate based on LIBOR was 8.66%
at October 31, 1998.

On November 6, 1998, the Company and its lenders agreed to certain amendments to
the senior credit agreement to provide,  among other changes, for an increase in
the total available under the revolving credit facility from $30,000 to $31,500;
a change in the financial statement covenants effective from August 1, 1998; and
an increase in the pricing on the revolving credit agreement from 1% above prime
to 1.25% above prime.

The lenders on the senior  credit  agreement  also agreed to provide the Company
with a new term loan of $2,500. In connection with this new term loan, principal
repayments on all term loans were kept at $200 per month, however, the effective
interest rate was increased effective November 1, 1998 to 1.5% above prime. As a
result of the increase in the principal amount, but keeping the amortization the
same, the Company has a balloon payment of $1,600 on the term loans at the final
maturity in fiscal 2001. The terms of the amended credit agreement  provide that
proceeds from the sale or  disposition  of fixed assets are to be applied to the
term loans in reverse  order of  maturity.  Since the  Company  is  planning  to
dispose of certain  fixed assets  during fiscal year 1999, it is likely that the
proceeds from these dispositions will  substantially  reduce the balloon payment
on these term loans.  The fixed assets  being  disposed of are  principally  the
excess facilities  associated with the special charge recorded by the Company in
fiscal 1998.

Pursuant  to the  subordinated  debt  facility,  the  Company  has  Subordinated
Debentures in the principal amount of $8,000 and Junior Subordinated  Debentures
in the  principal  amount of $4,000  plus  accrued  interest  of $375.  Interest
payments on the Subordinated Debentures of 11.5% per annum are payable quarterly
in arrears commencing July 1, 1994. The Subordinated  Debentures provide for the
repayment  of  principal  of $2,000 in fiscal 1999 and fiscal 2000 and $4,000 in
fiscal 2001.  Interest on the Junior  Subordinated  Debentures accrues at 14.5%,
and  the  cash  interest  of 11% per  annum  is  payable  quarterly  in  arrears
commencing January 1, 1996. The Junior  Subordinated  Debentures provide for the
repayment of principal of $4,000 and unpaid interest in June 2001 or thirty days
after the payment of the Subordinated Debentures.

The  Subordinated  Debenture  Holders  have agreed to the  amendment  of certain
provisions in the senior credit agreement, and in connection with these changes,
certain other changes have been  negotiated in the  subordinated  debt facility,
including a change in the financial statement covenants effective August 1, 1998
and a deferral in the payment date for the $2,000  principal  payment due in May
1999.

The Company continues to make progress in implementing its outsourcing  program.
Normal seasonal issues affecting sales and orders in November and December and a
still low, although  improving,  vendor on-time delivery  performance,  however,
continue to strain the Company's liquidity  position.  The Company is discussing
with  both  external  and  internal  sources  obtaining  up to $1.0  million  of
additional  financing.  The Company believes such financing,  together with cash
flows from operations and amounts available under the revolving credit facility,
will be  sufficient  to fund the  Company's  operations  during the remainder of
fiscal 1999. The Company's failure to obtain such financing on acceptable terms,
however, would likely adversely affect the Company's results of operations.




                                       9
<PAGE>

Year 2000 Compliance

Many currently  installed  computer  systems and software  products are coded to
accept only two digit  entries to represent  years.  These  systems and products
will need to be able to accept four digit entries to distinguish years beginning
with 2000 from prior years. As a result, systems and products that do not accept
four digit year entries will need to be upgraded or replaced to comply with such
"Year 2000" requirements.

The Company  believes that its internal  systems are Year 2000 compliant or will
be  replaced in  connection  with  previously  planned  upgrades to  information
systems  prior to the need to comply  with Year 2000  requirements.  The Company
believes that, with  modifications  to existing  software and conversions to new
systems, the Year 2000 issue will not pose significant  operational problems for
its computer  systems.  However,  if such  modifications and conversions are not
made, or not completed timely,  the Year 2000 issue could have a material impact
on the  operations of the Company.  In order to assure that this does not occur,
the Company  plans to devote all resources  required to resolve any  significant
year 2000 issues in a timely  manner.  A number of the  Company's  customers and
suppliers  may also be  affected by the Year 2000 issue that  require  that they
expend significant resources to modify or replace their existing systems;  their
failure to properly address the Year 2000 issue could have significant impact on
the Company's operations.

The  Services and Machine Tool Groups  (which  operate off one computer  system)
will be  upgrading  to a new  system  that will  provide  substantially  greater
functionality,  particularly in the area of materials requirement planning.  The
Tooling Systems Group is installing the same system,  while the Industrial Group
has completed their installation of the same software.  The total expected costs
for these upgrades is  approximately  $2,800,  of which  approximately  $500 has
already been spent.  A  significant  amount of fiscal 1999 capital  expenditures
will be devoted to upgrading  current  hardware and software to add capabilities
and comply with Year 2000 issues.

The  Company  expects to  complete  the system  upgrades  by the summer of 1999.
However, if there is a delay in new system installation, management believes the
existing  systems can be upgraded to Year 2000 compliance in a relatively  short
period of time.

Cautionary Factors

The discussions in this document may include certain forward-looking statements.
Actual   results   could  differ   materially   from  those   reflected  by  the
forward-looking  statements  contained in this  document and a number of factors
may affect  future  results,  liquidity  and capital  resources.  These  factors
include: the ability of the Company to obtain sufficient parts from its vendors;
the  ability  of the  Company  to obtain  trade  credit  from  those  vendors on
favorable terms; the fact that the Company derives a substantial  portion of its
sales from cyclical industries,  including the automotive, aerospace and housing
industries;  the ability to introduce new products in a timely fashion; the pace
of  technological  changes  affecting  the  products  manufactured  and services
provided by the Company;  the Company's  substantial debt service  requirements,
much of which are based on  variable  rates;  the  dependence  of the  Company's
growth on acquisitions  and the Company's  ability to finance such  acquisitions
and to  profitably  integrate  the  acquired  operations;  the level of  margins
achievable in the markets served by the Company;  and the ability to continue to
minimize operating  expenses.  Although the Company believes it has the business
strategy and resources needed for improved  operations,  future sales and margin
trends cannot be reliably predicted.


                                       10
<PAGE>

PART II - Other Information

Item 6. Exhibits and Reports on Form 8-K

(a)  Exhibits

10.1 Fifth  Amendment to Amended and Restated  Financing and Security  Agreement
     dated November 10, 1998 among DeVlieg-Bullard, Inc., the CIT Group/Business
     Credit, Inc. and BNY Financial Corporation.

10.2 Agreement   dated   November  5,  1998  among  BancOne   Capital   Partners
     Corporation,  PNC Capital Corporation and DeVlieg-Bullard,  Inc. concerning
     amendments to the Investment Agreement.

27   Financial Data Schedules (SEC use only)

(b)  Reports on Form 8-K

During the quarter ended October 31, 1998,  the Company did not file any reports
on Form 8-K.



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<PAGE>

                                   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.




                                       DeVlieg-Bullard, Inc.
                                       -----------------------------------------
                                       (Registrant)





Date:    December 15, 1998             By: /s/ W. O. Thomas
                                           -------------------------------------
                                           President and Chief Executive Officer
                                           (Acting Chief Accounting Officer




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